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W61
Minutes for
To:
Members of the Board
From:
Office of the Secretary
June 29, 1962
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.
Chin. Martin
Gov. Mills
Gov. Robertson
Gov. Balderston
Gov. Shepardson
Gov. King
Gov. Mitchell
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Federal Reserve Bank of St. Louis
CID
Minutes of the Board of Governors of the Federal Reserve
SYstem on Friday, June 29, 1962.
The Board met in the Board Room
at 10:00 a.m.
PRESENT:
Mr.
Mr.
Mr.
Mr.
Mr.
Balderston, Vice Chairman
Mills
Robertson
Shepardson
Mitchell
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Sherman, Secretary
Molony, Assistant to the Board
Cardon, Legislative Counsel
Fauver, Assistant to the Board
Noyes, Director, Division of
Research and Statistics
Holland, Adviser, Division of
Research and Statistics
Koch, Adviser, Division of Research
and Statistics
Furth, Adviser, Division of International Finance
Spencer, General Assistant,
Office of the Secretary
Eckert, Chief, Banking Section,
Division of Research and Statistics
Yager, Chief, Government Finance
Section, Division of Research and
Statistics
Keir, Senior Economist, Division of
Research and Statistics
Money market review.
Mr. Keir commented on the Government
securities market, in which connection he distributed a table
sIznimarizing recent changes in yields on Government securities and
4 chart showing sources of financing of Government securities
clealers for the period April 13-June 27, 1962.
Following Mr. Keirts
rem_
'..1.rks, Mr. Koch discussed current economic and banking developments.
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Federal Reserve Bank of St. Louis
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-2All members of the staff except Messrs. Sherman, Molony,
Cardon, ftuver, Noyes, and Spencer then withdrew and the following
entered the room:
Mr. Hackley, General Counsel
Mr. Solomon, Director, Division of
Examinations
Mr. Johnson, Director, Division of
Personnel Administration
Mr. Kiley, Assistant Director, Division
of Bank Operations
Mr. Goodman, Assistant Director, Division
of Examinations
Mr. Leavitt, Assistant Director, Division
of Examinations
Mr. Potter, Senior Attorney, Legal Division
Quarterly survey of consumer buying intentions (Items 1, 2,
UI•
In 1959 the Board discontinued financial support of the
44nua1 survey of consumer finances conducted by the University of
Michigan.
Since that time, the Board had contributed funds to the
114reau of the Census to finance quarterly surveys of consumer buying
intentions.
However, it had been anticipated that the Board would be
l'elieved of that financial responsibility, and funds to finance the
quarterly survey were requested in the President's budget for fiscal
1962-
The necessary appropriation was approved initially by the
400.se and Senate but was subsequently "deferred without prejudice"
at the time the Census Bureau's budget was approved by the Congress.
48 a result, appropriated funds could not be made available to
-4-vort the quarterly survey until Congressional action on the fiscal
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1963 Federal budget.
Consequently, the Bureau of the Budget and
the Council of Economic Advisers asked that the Board give interim
support to the first two quarterly surveys for 1962.
The Board
aPproved this request at its meeting on October 20, 1961.
There had been distributed a memorandum dated June 28,
1962, from Mr. Noyes stating that, because of delay in action on
the 1963 budget of the Bureau of the Census, the Board was being
asked by the Budget Bureau to finance the quarterly survey of
consumer buying intentions scheduled to be made in July
estimated cost being $32,500.
1962, the
In this memorandum, Mr. Noyes some-
what reluctantly recommended that the Board approve the request.
Attached to his memorandum were copies of a letter dated June 22,
1962/ from the Council of Economic Advisers to the Bureau of the
B4dget urging continuation of the quarterly survey, and a letter
°4ated June 26, 1962, from the Budget Bureau requesting that the
8°arot finance the July 1962 survey.
The Bureau's letter pointed
°lit that the July survey was of special significance for assessing
Q°11sumer attitudes for the immediate months ahead.
Further, the
ue of having knowledge of consumer buying prospects for major
krable goods was sufficiently great to warrant special efforts to
Insure conduct of the July survey, regardless of the final disposition
Or the question of continuing the survey.
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Federal Reserve Bank of St. Louis
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In commenting on the Budget Bureau's request, Mr. Noyes
recommended that if the Board was disposed to approve support of
the third quarterly survey) Mr. Cardon be asked to bring this request
to the attention of the Chairmen of the Appropriations Subcommittees
of the House and Senate that were handling the matter to determine
whether they would have any objection to the Board's financing
the costs of the July survey.
Governor Mills asked whether it was also contemplated that
the Congressional Subcommittees be advised that the Board's position
/Ma not one of its choosing) but rather that it continued to be the
Board's desire that the program be undertaken by the Census Bureau
out of appropriated funds.
Mr. Cardon replied that he felt the Subcommittees should be
advised to the effect that, while the Board was prepared to furnish
interest in preserving
interim support, it did so because of the
the continuity of the statistics.
by
Mr. Noyes then responded to several questions raised
Governor Mitchell with respect to the Board's reasoning in financing
the earlier quarterly surveys.
In this connection) Mr. Noyes noted
that the Bureau of the Budget and the Council of Economic Advisers
1184 initiated the request that the Board support the first two
clUkrterly surveys in 1962 and that the Board then felt there was
8Uff1cient merit in the continuation of the survey to justify the
e4enditure.
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Governors Robertson and Shepardson indicated that they
'Would vote to approve the request, with the understanding that if
the Chairmen of the Appropriations Subcommittees of the Senate and
Rouse expressed any reservations about the Board's furnishing
interim support, the matter would be brought back to the Board
tor further consideration.
Governor Mitchell said he would take the position that if
the Board felt a survey was worth conducting, then it should give
84Pport whether or not the Congress was willing to finance it
through appropriations.
In this instance, he would be agreeable
to the Board furnishing support for the July survey.
Governor Balderston indicated that he also would favor
IIPProvai of the request.
Following further discussion, the Bureau of the Budget's
l'eqUest was approved, subject to clearance with the Appropriations
SUbcommittees of the Senate and House, and with the understanding
that this action included authorization for any resulting overand
)q)
enditure in the 1962 budget of the Division of Research
Statistics.
Copies of letters sent to the Chairmen of the
1 and 2.
415ProPriate Subcommittees are attached as Items No.
Secretary's Note: Following receipt of
advice that the Chairmen of the Subcommittees had indicated that they would
have no objection to the Board's furnishing
interim financial support for the quarterly
survey of consumer buying intentions
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Federal Reserve Bank of St. Louis
212
6/29/62
-6scheduled to be made in July 1962, a
letter was sent to the Bureau of the
Budget stating that the Board had
authorized payment of the costs
estimated at $32,500. A copy of the
letter is attached as Item No. 3.
Branch deposit survey (Item No. 4).
Governor Mitchell
referred to a letter sent to all national banks by the Comptroller
Of the Currency under date of June 51 1962, informing them that
the furnishing of reports asked for by the Board at Congressman
Patman's request regarding chain banking and those requested by
the Board relating to data of deposits by branches as of June 30,
1962, was a matter for the discretion of the national bank concerned.
lie pointed out that the branch deposit report was a part of the Government
statistical program, and he inquired whether the Bureau of the Budget
had been informed of the contents of the Comptroller's letter,
since this represented an instance in which one agency of Government
/las interfering with the collection of a report by another agency
after the report had been appropriately cleared by the Bureau.
Comments indicated uncertainty as to whether the Comptroller's
letter referred to by Governor Mitchell, which was dated June 5,
44, come to the attention of the Bureau of the Budget.
Secretary also stated that the Board's letter of June
The
5 to all
Reserve Banks requesting collection of branch deposit data had
11°t been sent to the Bureau of the Budget in its final form, although
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6/29/62
the Bureau had approved the form of report and commented on the draft
Of letter to the Reserve Banks containing reporting instructions, in
line with the Bureau's responsibility for the Government's statistical
programs.
During the ensuing discussion, the Secretary was requested
to send to the Bureau of the Budget a copy of the Board's letter
regarding the branch deposit survey in the form sent to all Federal
Reserve Banks on June 5, together with a copy of the Board's
telegram to the Presidents on June 25 advising that the report of
member bank deposits by branches was a mandatory report.
A copy
Of the letter to the Bureau of the Budget is attached as Item No. 4.
Messrs. Molony, Cardon, and Noyes withdrew from the meeting
4t this point.
National bank examination reports. Governor Robertson
Iltised the question whether the Board had received a reply to its
letter of June 27, 1962, to the Comptroller of the Currency with
liesPect to charges for national bank examination reports.
Mr. Sherman responded that no reply had been received.
Ikvever, a copy of a letter dated June 27, 1962, from the Comptroller
to the Presidents of all Federal Reserve Banks informing them of a
liev schedule of charges for providing Reserve Banks with copies of
zielp°rts of examination of national banks and a covering transmittal
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-8-
letter dated June 26 from the Administrative Assistant to the
Comptroller had been received at the Board on June 28.
It was
noted that the Board's letter of June 27 to the Comptroller regarding proposed charges for such reports was sent on the same
date as the Comptroller's letter to the Reserve Bank Presidents
informing them of the new rates.
Discount rates.
The establishment without change by the
Pederal Reserve Banks of New York, Cleveland, Richmond, Atlanta,
St. Louis, Minneapolis, and Dallas on June 28, 1962, of the rates
on discounts and advances in their existing schedules was approved
Unanimously, with the understanding that appropriate advice would
be sent to those Banks.
Circulated or distributed items.
The following items, which
had been circulated or distributed to the members of the Board and
e oPies of which are attached to these minutes under the respective
item numbers indicated, were approved unanimously:
Item No.
utter to The First National Bank of Bar Harbor,
:ar Harbor, Maine, approving its supplemental
13Plication for fiduciary powers.
5
Ltd.,
5J,etter to Chemical International Finance,
to the
6
York, New York, granting consent
Pritrehase of shares of First Acceptance and
Ilvestment Corporation, Manila, Philippines.
'
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Federal Reserve Bank of St. Louis
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-9Item No.
Letter to International Banking Corporation, New
York, New York, granting consent to the purchase
Of additional capital stock of The First National
City Bank of New York (South Africa) Ltd.,
Johannesburg, Union of South Africa.
7
Letter to New Jersey Bank and Trust Company,
Clifton, New Jersey, approving an extension
Of time to comply with a condition of membership.
8
Letter to the Federal Reserve Bank of Cleveland
approving the payment of salaries to four
officers at rates fixed by the Bank's Board of
Directors.
9
Letter to the Federal Reserve Bank of Richmond
approving the payment of salaries to three
officers at rates fixed by the Bank's Board
Of Directors.
10
Letter to The Washington County National Bank
?f Abingdon, Abingdon, Virginia, approving
lts supplemental application for fiduciary
powers.
Letter to the Federal Reserve Bank of Chicago
approving the payment of salaries to the Bank's
engineers and firemen at specified rates.
12
.letter to The Citizens State Bank of Petersburg,
Petersburg, Indiana, approving an investment in
ba.nk premises.
13
Letter to St. Joseph Valley Bank, Elkhart, Indiana,
1' 3Proving an extension of time to establish a
7
ranch in the vicinity of Nappanee and West
-Lndiana Streets.
Letter to Red River National Bank of Grand Forks,
!and Forks North Dakota, approving its application
-Lox' fiduciary
' powers.
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Federal Reserve Bank of St. Louis
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6/29/62
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Item No.
Letter to the Federal Reserve Bank of San
Francisco interposing no objection to the
execution of a fallout shelter license to the
Federal Government permitting the use of certain
areas in the Bank's service building, 241
Battery Street, for fallout shelter purposes.
16
Letter to United California Bank, Los Angeles,
California, approving an extension of time to
establish a branch at 1800 Van Ness Avenue,
San Francisco.
17
Letter to the Department of Justice granting
ita request that representatives of the Antitrust
Division be permitted to examine reports of
condition filed by Morgan Guaranty Trust
,lomloany of New York for the years 1959 through
4.961 relative to an investigation of possible
violations of the antitrust laws.
18
Letter to Hempstead Bank, Hempstead, New York,
2:Proving the establishment of a branch in Old
thtlage, Nassau County.
Letter to The Detroit Bank and Trust Company,
Detroit, Michigan, approving the establishment
2t a branch in the vicinity of Ten Mile and
fteenfield Roads, Royal Oak Township.
20
Letter to United California Bank, Los Angeles,
!
alifornia, approving the establishment of a
'
e
'ranch in the Coddingtown Regional Shopping
ellter, Sonoma County, and rescinding the
!
4°ard's April 18, 1962 approval of a branch
n Santa Rosa, Sonoma County.
21
In connection with Item No. 18, a letter to the Department
°t Justice giving access to reports of condition of a member bank,
Governor Mills stated that he approved the position taken even
th
Ugh that might seem contrary to the position he had taken with
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respect to holding certain information confidential.
However, he
did not regard the regular required report of condition, including
the reverse side which is not published, as containing the kind
Of information relating to transactions between a bank and its
customers that should be held in confidence.
Mr. Goodman then withdrew.
Report on competitive factors (Pittsfield-Adams, Massachusetts).
There had been distributed a draft of report to the Comptroller of
the Currency on the competitive factors involved in the proposed
consolidation of The First National Bank of Adams, Adams, Massachusetts, and First Agricultural National Bank of Berkshire County,
Pittsfield, Massachusetts.
After agreement was expressed with a suggestion to change
the wording of the second paragraph of the conclusion, the report
/448 approved unanimously for transmittal to the Comptroller in a
r°rm in which the conclusion read as follows:
Competition between applicant banks is minor and
little competition would be eliminated by the proposed
consolidation. While the proposed consolidation will
not result in any substantial lessening of competition,
it is in furtherance of a trend toward concentration of
commercial banking resources in a few large banks.
Since prior to December 29, 1961, the number of
commercial banks in the service area with which this
application is concerned has been reduced from seven
to four. This consolidation would further reduce the
number to three. The impact of this trend toward
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Federal Reserve Bank of St. Louis
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concentration of commercial banking resources in a
few banks is tempered somewhat by the strong competitive
capabilities of savings institutions in the area.
Report on competitive factors (Windsor Locks-Thompsonville
Connecticut).
A draft of report to the Comptroller of the
Currency on the competitive factors involved in the proposed
Consolidation of First National Bank of Windsor Locks, Windsor
Lcoks, Connecticut, and First National Bank of Thompsonville,
Mompsonville, Connecticut, had been distributed.
After brief discussion, the report was approved unanimously
for transmittal to the Comptroller. The conclusion in the report
read as follows:
This proposal would unite two affiliated banks
between which little, if any, competition exists. The
resulting bank might be able to compete more effectively
with the two large banks which operate branches in its
service area.
f2port on competitive factors (Shirler-Kennard, Indiana).
draft of report to the Federal Deposit Insurance Corporation on
the competitive factors involved in the proposed merger of Kennard
State Bank, Kennard, Indiana, with The Citizens State Bank of
Shirley Shirley, Indiana, had been distributed.
The conclusion
in the report read as follows:
The proposed merger of Kennard State Bank, Kennard,
Indiana, with The Citizens State Bank of Shirley, Shirley,
Indiana, would not have any adverse effect on competition.
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Federal Reserve Bank of St. Louis
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-13The report was approved unanimously for transmittal to the
Corporation.
Report on competitive factors (Humeston, Iowa).
There had
been distributed a draft of report to the Federal Deposit Insurance
Corporation on the competitive factors involved in the proposed
acquisition of assets and assumption of liabilities of Citizens
State Bank, Humeston, Iowa, by The Citizens State Bank, Humeston,
lova.
The conclusion in the report read as follows:
The proposed acquisition of assets and assumption of
liabilities of Citizens State Bank, Humeston, Iowa, by The
Citizens State Bank, Humeston, Iowa, would have no effect
on competition.
The report was approved unanimously for transmittal to the
Corporation.
Report on competitive factors (Leon, Iowa).
There had been
(11stributed a draft of report to the Federal Deposit Insurance
C°rporation on the competitive factors involved in the proposed
4equisition of assets and assumption of liabilities of Decatur
e°4ntY State Bank, Leon, Iowa, by The Decatur County State Bank,
Iftn, Iowa.
The report, in which the conclusion read as follows, was
oved unanimously for transmittal to the Corporation:
and assumption of
The proposed acquisition of assets
Leon, Iowa, by
Bank,
State
liabilities of Decatur County
no
effect on
have
would
The Decatur County State Bank
competition.
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Federal Reserve Bank of St. Louis
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Purchase of computer by Atlanta Bank (Item No. 22).
A
telegram dated June 27, 1962, had been received from the Federal
Reserve
PAT*
of Atlanta advising that that Bank had elected to
exercise its option to purchase an IBM 1401 computer, effective
J4157 1, 1962. In this connection, Mr. Sherman reported that a
draft of telegram had been prepared that would note without objection
the Bank's proposal to purchase the computer presently rented under
aUthority of the Board's telegram of December 21, 1961.
It was
Understood that the purchase price would be approximately $230,000
after allowance for a portion of the Bank's rental payment on the
equipment.
There being no objection, it was understood that the telegl‘am, a copy of which is attached as Item No. 22, would be sent to
the Atlanta Reserve Bank.
Application of Asbury Park and Ocean Grove Bank (Items 23
Pursuant to the decision at the meeting on June 18, 1962,
distribution had been made under date of June 27 of drafts of an
order and statement reflecting the Board's denial of the application
Of
Asbury Park and Ocean Grave Bank, Asbury Park, New Jersey, to
merge with
The Central Jersey Bank and Trust Company, Freehold, New
Jersey.
Subsequently, distribution was made under date of June 28
°t a revised draft of the summary and conclusion set forth in the
Pl'oposed statement.
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Federal Reserve Bank of St. Louis
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-15After several changes were agreed upon, the issuance of the
order and statement was authorized, it being understood that the
statement would contain the revised summary and conclusion.
Copies
Of the order and statement, as issued, are attached hereto as Items
23 and 24.
All members of the staff then withdrew and the Board went
into executive session.
Salary increase.
The Secretary was later informed that
during the executive session the Board approved an increase in the
basic annual salary of Jerome W. Shay, Assistant General Counsel,
Legal Division, from $15,850 to $16,850, effective July 1, 1962.
The meeting then adjourned.
Secretary's Note: Governor Shepardson
today approved on behalf of the Board
the following items:
Letter to the Federal Reserve Bank of Cleveland (attached
5) approving the appointment of Robert H. Farber, Jr.,
92
25)
as assistant examiner.
Letters to the Federal Reserve Bank of New York (attached
Items 26 and 27) and to the Federal Reserve Banks of Boston and
Philadelphia attached Items 28 and 29) regarding a call for reports
Of condition as of June 30, 1962, from foreign banking and foreign
financing corporations.
Memoranda from appropriate individuals concerned recommending
,
the following actions relating to the Board staff:
Re 21Ployment following maternity leave
--21
Shirley R. Sherman as Secretary, Office of the Secretary, with
"ic annual salary at the rate of $5,170, effective July 2, 1962.
b
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Slateide activities
J. H. Atkinson, Economist, Division of Research and Statistics,
to continue general supervision of research, review of manuscripts,
theses, etc., at Purdue University (with no compensation), and to
complete two contracts in egg futures entered into prior to his
rentering the Board's employ.
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Federal Reserve Bank of St. Louis
2'1
BOARD OF GOVERNORS
Item No. 1
6/29/62
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON
OFFICE OF THE CHAIRMAN
July 2, 1962.
The Honorable Spessard L. Holland,
Chairman, Subcommittee on Department of
Commerce and Certain Related Agencies,
Committee on Appropriations,
United States Senate,
Washington 25, D. C.
Dear Mr. Chairman:
The Bureau of the Budget has requested the Board of
to continue through the
Governors of the Federal Reserve System
s agreed upon last
arrangement
temporary
the
1962
third quarter of
Consumer
Buying
of
November for financing the Quarterly Survey
the
Bureau
of the
recall,
will
you
sure
am
Anticipations: As I
make
this
to
survey,
ons
appropriati
requested
Census last year
Which had previously been financed on an experimental basis by the
Congress on this request was
Federal Reserve, but action by the
Board then agreed to finance the
deferred "without prejudice." The
after taking steps to
survey for the first two quarters of 1962,
es handling the matter
Subcommitte
ons
Appropriati
determine that the
had no objection.
This year, the Bureau of the Census again requested funds
for the survey, but Congress had not yet acted on it. If the third
work should start
quarter survey is to be completed on schedule,
field operations in
for
prepare
Within the next few days in order to
of the Budget's
Bureau
the
to
agree
mid -July. The Board is prepared to
to
be
survey
the
continued
permit
request as an interim measure, to
on
appropriati
requested,
the
on
Pending final action by the Congress
of last
extension
unwarranted
unless you feel that this would be an
Year's agreement.
on Friday with
This proposal was discussed informally
e on State,
Subcommitte
ons
Appropriati
Chairman Rooney of the House
Agencies.
Related
He inand
Justice, Commerce, and the Judiciary
would
which
not
proposal,
involve
dicated he has no objection to the
appropriated funds.
Sincerely yours,
(Signed) Wm. McC. Martin, Jr.
Wm. McC. Martin, Jr.
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Federal Reserve Bank of St. Louis
`1 1
BOARD OF GOVERNORS
Item NO. 2
6/29/62
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON
OFFICE OF THE CHAIRMAN
July 2, 1962.
The Honorable John J. Rooney,
Chairman, Subcommittee on Department of
Commerce and Certain Related Agencies,
Committee on Appropriations,
United States House of Representatives,
Washington 25, D. C.
Dear Mr. Chairman:
The Bureau of the Budget has requested the Board of
Governors of the Federal Reserve System to continue through the
third quarter of 1962 the temporary arrangements agreed upon last
November for financing the Quarterly Survey of Consumer Buying
Anticipations. As I am sure you will recall, the Bureau of the
Census last year requested appropriations to make this survey,
Which had previously been financed on an experimental basis by the
Federal Reserve, but action by the Congress on this request was
deferred "without prejudice." The Board then agreed to finance the
survey for the first two quarters of 19620 after taking steps to
determine that the Appropriations Subcommittees handling the matter
had no objection.
This year, the Bureau of the Census again requested funds
for the survey, but Congress has not yet acted on it. If the third
quarter survey is to be completed on schedule, work should start
Within the next few days in order to prepare for field operations in
mid -July. The Board is prepared to agree to the Bureau of the Budget's
request as an interim measure, to permit the survey to be continued
Pending final action by the Congress on the appropriation requested,
unless you feel that this would be an unwarranted extension of last
Year's agreement.
the Board, advises
Robert L. Cardon, legislative counsel of
on
Friday that you
conversation
telephone
me that you indicated in a
an expenditure of
would
involve
It
have no objection to this proposal.
third
the
only
quarter
survey,
financing
$32,000.00, and contemplates
Oil which, as indicated above, work would normally start next week.
Sincerely yours,
(Signed) Ehl McC. Martin, Jr.
Wm McC. Martin, Jr.
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Federal Reserve Bank of St. Louis
BOARD OF GOVERNORS
Item No.
OF THE
6/29/62
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
July
5, 1962
la'. Raymond T. Bowman,
Assistant Director for
Statistical Standards,
Bureau of the Budget,
Washington 25, D. C.
Dear Mr. Bowman:
In accordance with the request contained in your
letter of June 26, 1962, addressed to Mr. Noyes, the Board
has authorized the payment of the costs, understood to be
estimated at $32,500, of a survey of consumer buying intentions scheduled to be made in July 1962. The Board's
authorization for payment of these costs has been given with
the knowledge of the Chairmen of the Congressional Committees
now considering the Census Bureau's 1963 budget request, which
contained provision for the making of the quarterly survey of
consumer buying intentions but on which action has not yet
been completed by the Congress.
Very truly yours
Merritt he
(
Secret&
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Federal Reserve Bank of St. Louis
3
Item No. 4
BOARD OF GOVERNORS
6/29/62
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
At
:
*°
TO THE BOARD
,se
a, tgattioao4ar-
June 29, 1962
Mr. David E. Cohn, Clearance Officer;
Office of Statistical Standards,
Bureau of the Budget,
Washington 25, D. C.
Dear Mr. Cohn:
On May 25, 1962, your office approved a form for use by
the Board of Governors in collecting data of deposits of branches
assigning
of banks having branches outside their head office
to the form Budget Bureau No. 55-6203. This form was subsequently
transmitted to the Federal Reserve Banks with the Board's letter of
June 5, 1962, a copy of which is enclosed. The Reserve Banks in
turn presented the form to member banks having such branch offices
with a request that they supply the data specified as of June 30,
1962.
For your information, there is also enclosed a photostatic
copy of a letter and attachments sent under date of June 5 by the
Comptroller of the Currency to all national banks; in the second para.
graph of which reference is made to the Board's above mentioned request for reports of branch deposit data of member banks. The letter
of the Comptroller, in the last sentence of the paragraph referred to,
'informed national banks that participation in this survey was at their
discretion.
Because a question was raised with the Board late last week
as to whether member banks were required to complete the report of
branch deposits or whether participation was voluntary; the Board sent
a wire to the Presidents of all Federal Reserve Banks on June 25 confirming that banks were required to complete this report pursuant to
Section 11(a) of the. Federal Reserve Act. The Board's wire read as
follows:
"Question has been raised as to whether report of member bank deposits by branches referred to in Board letter of
June 5, 1962, is a mandatory report. Such report is required
by the Board pursuant to Section 11(a) of the Federal Reserve
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
BOARD
OF GOVERNORS OF TtiE Ft DERAL RESERVE SYSTEM
Mr. David E. Cohn
-2-
to the necessity
Act, and any member bank inquiring as
med accordingly."
infor
be
d
for supplying information shoul
your
gram
city
bank
tion
d to you in order that
This information is being transmitte
to
opments in the proas
devel
med
office may be currently.infor
the head office
de
hes
outsi
for collection of deposits of branc
any member
plat
aware
not
of the parent bank. The Board is
the informash
d
inten to furni
operating such branches does not
called for.
Very. truly yours,
Merritt She
Secretary.
Enclosures
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
BOARD OF GOVERNORS
9,1.4
Item No.
OF THE
4
6D af SOPS4
FEDERAL RESERVE SYSTEM
‘?;V144'
r
t
5
6/29/62
WASHINGTON 25. D. C.
r!*
k:
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
June 29, 1962
Board of Directors,
The First National Bank of Bar Harbor,
Bar Harbor, Maine.
Gentlemen:
The Board of Governors of the Federal Reserve System has
given consideration to your supplemental application for fiduciary
Powers and grants you authority to act as 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 nati(,nal banks
are permitted to act under the laws of the State of Maine. The
exercise of such rights shall be subject to the provisions of
Section 11(k) of the Federal Reserve Act and Regulation F of the
Board of Governors of the Federal Reserve System.
In addition to the fiduciary powers herein authorized,
the bank was granted authority, on January 23, 1917, to act as
trustee, executor, administrator and registrar of stocks and bonds.
A formal certificate indicating the fiduciary powers that
Your bank is now authorized to exercise will be forwarded in due
course.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
Item No, 6
BOARD OF GOVERNORS
6/29/62
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
June 292 1962.
Chemical International Finance, Ltd.,
20 Pine Street,
New York 8, New York.
Gentlemen:
In accordance with your request and on the basis of the
information furnished in your letter of June 4, 1962, transmitted
through the Federal Reserve Bank of New York, the Board of Governors
grants consent for Chemical International Finance, Ltd. to purchase
and hold 900,000 shares of common stock, par value P1 each, of
First Acceptance and Investment Corporation, Manila, Republic of
the Philippines, at a cost of approximately US41i250,000, provided
such stock is acquired within one year from the date of this letter.
The Boardls consent is granted upon condition that
Chemical International Finance, Ltd. shall dispose of its holdings
cf stock in the Philippine corporation, as promptly as practicable,
in the event that the Philippine/ corporation should at any time
(1) engage in issuing, underwriting, selling or distributing securities in the United States; (2) engage in the general business of
buying or selling goods, wares, merchandise, or commodities in the
United States or transact any business in the United States except
such as is incidental to its international or foreign business; or
(3) otherwise conduct its operations in a manner which, in the judgment of the Board of Governors, causes the continued holding of its
stock by Chemical International Finance, Ltd. to be inappropriate
under the provisions of Section 25(a) of the Federal Reserve Act or
regulations thereunder.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
BOARD OF GOVERNORS
Item NO.
OF THE
7
6/29/62
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADORESS OFFICIAL CORRESPONDENCE
TO THE BOARD
June 290 1962.
International Banking Corporation,
399 Park Avenue,
New York 22, New York.
Gentlemen:
In accordance with the request and on the basis
of information furnished in your letter of June 14, 1962,
transmitted through the Federal Reserve Bank of New York,
the Board of Governors grants its consent to the purchase
and holding by your Corporation of additional catatsAl stock
of The First National City Bank of New York (South Africa)
Limited in the amount of 200,000 South African Rands
(approximately US '280,000.)
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
2411
Item No. 8
6/29/62
BOARD OF GOVERNORS
OF THE
'
44-9
900 gOki,
40
FEDERAL RESERVE SYSTEM
.4
4
44
4#
WASHINGTON 25., D. C.
14
'
*
4
4,
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
**741.EitS
'tz tiao*TI.
June 29, 1962
Board of Directors,
New Jersey rank and Trust Company,
Clifton, New Jersey.
Gentlemen:
Under condition of membership numbered 3, New Jersey
Bank and Trust Company was to dispose, within a period of not
to exceed three years, of all corporate stocks owned at the
time of admission to membership. The Board subsequently extended this period one year to June 20, 1962. After considering the circumstances and in ftccordance with the request in
your letter of June 13, 1962, addressed to the Federal Reserve
Bank of New York, the Board has extended until June 20, 1963,
the time within which to comply with membership condition
numbered 3.
Very truly yours,
(signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
BOARD OF GOVERNORS
Item No. 9
OF THE
6/29/62
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADDRESS OrFICIAL CORRESPONDENCE
TO THE BOARD
June 29, 1962
CONFIDENTIAL (FR)
Mr. Wilbur D. Fulton, President,
Federal Reserve Bank of Cleveland,
Cleveland 1, Ohio.
Dear Mr. Fulton:
The Board of Governors approves the payment of salaries
to the following officers of the Federal Reserve Bank
Cleveland
for the period July 1 through December 31, 1962, at the rates
Indicated, which are the rates fixed by your Board of Directors
as reported in your letter of June 14, 1962:
Annual
Title
Salary
Name
Paul Breidenbach
Maurice Mann
T. E. Ormiston
George Booth
Counsel
Senior Monetary
Economist
Assistant Cashier
Assistant Counsel
$14,500
15,000
11,500
13,500
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
Item No. 10
6/29/62
BOARD OF GOVERNORS
00***
tAOW 401
:
! 14'40
OF THE
FEDERAL RESERVE SYSTEM
*
jI
Yi
WASHINGTON 25, D. C.
461.
Apo14cEis orFicsAL
4,
461'i
CORRESPONDENCE
TO THE HOAR°
\:4149.11
o***
June 29, 1962
22.1DPENTIAL (FR)
14r, Alonzo G. Decker Jr., Chairman,
Pederal Reserve Bank of Richmond,
Richmond 13, Virginia.
Dear Fir, Decker:
The Board of Governors approves the payment of salaries
to the following officers of the Federal Reserve Bank of Richmond
Lor
. the period July 1 through December 31, 1962, at the rates
Indicated, which are the rates fixed by your Board of Directors
8 reported in your letter of June 14:
Annual
Title
Salary
Name
Raymoild E. Sanders Jr.
James Parthemos
J. Lander Allin, Jr0
4;15,000
Vice President
Assistant Vice President 13,000
Assistant Cashier
10,500
Very truly yours
(Signed) Merritt
Merritt Sherman,
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
9141
BOARD OF GOVERNORS
joitatilog.4
44
,
4° 044016
1
\
,
OF THE
Item No. 11
6/29/62
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
.
6::.°
%,:kcaux#
June 29, 1962
Board of Directors,
The Washington County National Bank of Abingdon,
Abingdon, Virginia.
Gentlemen:
The Board of Governors of the Federal Reserve System has
given consideration to your supplemental application for fiduciary
Powers and grants you authority to act, when not in contravention
of State or local law, as registrar of stocks and bonds, assignee,
receiver or in any other fiduciary capacity in which State banks,
trust companies, or other corporations which come into competition
Isflth national banks are permitted to act under the laws of the
State of Virginia. The exercise of such rights shall be subject to
the provisions of Section 11(k) of the Federal Reserve Act and
aegulation F of the Board of Governors of the Federal Rs rye System.
In addition to the fiduciary powers herein authorized, the
bank was granted authority, on December 23, 1938, to act as trustee,
executor, administrator, guardian of estates, and committee of estates
of lunatics.
A formal certificate indicating the fiduciary powers that
Your bank is now authorized to exercise will be forwarded in due
course.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
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Federal Reserve Bank of St. Louis
4
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
Item No. 12
6/29/62
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
June 290 1962
CONFIDENTIAL (FR)
Mr. H. J. Newman, Vice President,
Federal Reserve Bank of Chicago,
Chicago 901 Illinois.
Dear Mr. Newman:
The Board of Governors approves the payment of
salaries by the Federal Reserve Bank of Chicago to the incumbents of the positions shown below at the rates indicated,
effective July 21 1962, in accordance with the request
contained in your letter of June 18:
Title
Annual Salary
Engineers
$7,342.40
Firemen
61510.40
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
r;
244
BOARD OF GOVERNORS
Item No. 13
6/29/62
OF THE
FEDERAL RESERVE SYSTEM
A*
M*
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
------' li
TO THE BOARD
June 29, 1962
Board of Directors,
The Citizens State Bank of Petersburg,
Petersburg, Indiana.
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 by The CY:izens
State Bank of Petersburg, Petersburg, Indiana, of $113,000
(includes purchase price of adjoining building) for remodeling
and extending present banking quarters into the adjoining building.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
fir!,
BOARD OF GOVERNORS
0000.010*,*
Item No. 14
6/29/62
OF THE
FEDERAL RESERVE SYSTEM
fltr
g
4*
WASHINGTON 25. D. C.
P
ADDRESS OFFICIAL CORRESPONDENCE
1111
TO THE BOARD
tral
June 29, 1962
Board of Directors,
St. Joseph Valley Bank,
Elkhart, Indiana.
Gentlemen:
The Board of Governors of the Federal Reserve
System extends to August 1, 1962, the time within which
St. Joseph Valley Bank may establish an in-town
branch
in the vicinity of the intersection of Nappanee
and
West Indiana Streets.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
f.""!1
12449
BOARD OF GOVERNORS
Item No. 15
6/29/62
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE 00ARD
June 291 1962
Board of Directors,
Red River National Bank of Grand Forks,
Grand Forks, North Dakota.
Gentlemen:
The Board of Governors of the Federal Reserve System
has given consideration to your application for fiduciary
powers and grants Red River National Bank of Grand Forks
of State or local
authority to act, when not in contravention
of stocks
registrar
or,
administrat
executor,
law, as trustee,
committee
receiver,
and bonds, guardian of estates, assignee,
in
capacity
fiduciary
of estates of lunatics, or in any other
corporatious
other
or
Which State banks, trust companies,
Which cone into competition with national banks are permitted
to act under the laws of the State of North Dakota. The
exercise of such rights shall be subject to the provisions
of Section 11 (k) of the Federal Reserve Act and Regulation F
of the Board of Governors of the Federal Reserve System.
A formal certificate indicating the fiduciary powers
that your bank is now authorized to exercise will be forwarded
in due course.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
9
Item No. 16
BOARD OF GOVERNORS
6/29/62
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
June 29, 1962
Mr. Eliot J. Swan, President,
Federal Reserve Bank of San Francisco,
San Francisco 20, California.
Dear Mr. Swan:
This is in reply to your letter of June 14, 1962, requesting the Board's comments relative to the proposed execution of a
standard form fallout shelter license to the Federal Government permitting the use of certain areas in the basement and on the first
floor of the Bank's Service Building, 241 Battery Street, San Francisco, California, for fallout shelter purposes.
It is understood that the use of the areas for shelter
Purposes under the terms of the license would not in any way interfere with the Bank's operations, the Bank's exclusive use of
its own shelter in the main Bank building, nor the security of the
Bank's premises. It is further understood that the license may be
revoked on ninety days' notice if for any reason the Bank might find
such action desirable.
Under these circumstances, the Board has no objection to
the execution of the license, and would encourage such act as further
evidence of the System's full cooperation with the Government in its
shelter program.
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
Item No.
BOARD OF GOVERNORS
17
6/29/62
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE SOAR°
June 29, 1962
Board of Directors,
United California Brink,
Los An6e1es, California.
Gentlemen:
The Board of Governors of the Federal Reserve
System extends to January 31/, 1963, the time within which
the United California Bunk may establish a branch at 1800
Van Ness Avenue, 6an Francisco, California.
Very truly yours,
(Signed) Elizabeth I" Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
1
BOARD
HOARD OF GOVERNORS
Item No. 18
6/29/62
494
OF THE
CP Sov% •
1,17"
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADDRESS
OFFICIAL
CORRESPONDENCE
TO THE BOARD
June 29, 1962
The
Honorable Lee Loevinger,
?ssistant Attorney General,
Antitrust
Division,
,$ S. Department of Justice,
ria
shington 25, D. C.
near Judge Loevinger:
This will acknowledge your letter of June 14, 1962, requesting
that
re representatives of the Antitrust Division be permitted to examine
I.:Its of condition filed by Morgan Guaranty Trust Company of New York
0„ the years 1959 through 1961 relative to an investigation being made
'
Possible violations of the antitrust laws.
In response to your request, the Board will make available at
its
„ offices for examination by your representatives the reports in
?Ztion. It is suggested that your representatives communicate with
Ba,,i_Gerald M. Conkling, Assistant Director of the Board's Division of
Operations, regarding arrangements for access to these reports.
In making these reports available to your Division, it should
be
al utderstood that, while the front sides of the reports of condition
111'; Published material, the reverse sides thereof are not published
younila,tion. It is requested that appropriate precautions be taken by
Division to avoid disclosure of unpublished information from this
04ree.
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
BOARD OF GOVERNORS
Item No. 19
6/29/62
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
June 29, 1962
Board of Directors,
Hempstead Rank,
Hempstead, Iew York.
Gentlemen:
The Board of Governors of the Federal Reserve System
approves the establishment of a branch by Hempstead Rank in
the Tru-Value Shopping Center, Old Pethpage Road, Old l'ethpage,
unincorporated area of Plainview, Town of Oyster Pay, Nassau
County, New York, provided the branch is established within
one Year from the date of this letter.
The Board is aware of the concern of the New York
State Ranking Board regarding the capital structure of Hempstead
Bank and notes that the Banking Department has approved the
subject application provided capital position of the bank will
not be permitted to fall below the minimum standards established
by the Banking Department. The Board has also expressed its
concern in this matter and wishes to stress the need for strengthening the bank's capital structure at the earliest opportunity.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
BOARD OF GOVERNORS
rf ql,,t000@o,
c): gsgUI
4400***4
44
Item No. 20
6/29/62
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
June 291 1962
Board of Directors,
The Detroit Bank and Trust Company,
Detroit, Michigan.
Gentlemen:
The Board of Governors of the Federal Reserve
System approves the establishment of a branch by The
Detroit Bank and Trust Company in the vicinity of the
intersection of Ten Mile and Greenfield Roads, Royal
Oak Township, Oakland County, Michigan, provided the
branch is established within one year from the date of
this letter.
Very truly yours,
(Signed) Elizabeth L0 Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
Item No. 21
6/29/62
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
June 29, 1962
Board of Directors,
United California Bank,
Los Angeles, California.
Gentlemen:
The Board of Governors of the Federal Reserve
System approves the establishment of a branch by United,
California Bank in the Coddingtown Regional Shopping Center,
Guerneville Highway and U. 6. Highway 101, Sonoma County,
California, provided the branch is established wiLuin one
year from the date of this letter. The approval of a branch
in the vicinity of Mendocino Avenue between Fourth Street and
College Avenue, Santa Rosa, Sonoma County, California, granted
by the Board on April 18, 1962, is hereby rescinded.
Very truly yours,
(Signed) Elizabeth L. Carmichael
aizabeth L. Carmichael,
Assistant Secretary.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
Item No. 22
6/29/62
TELEGRAM
LEASED WIRE SERVICE
BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
WASHINGTON
June 292 1962.
Patterson - Atlanta
Reurtel June 271 Board has noted without objection
your proposal to purchase IBM 1401 computer presently rented
under authority of Board's telegram December 211 1961.
Board
understands that purchase price will be approximately $230,000
after allowance for a portion of your rental payments on such
equipment.
(Signed) Merritt Sherman
SHERMAN
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
Item No. 23
6/29/62
UNITED STATES OF AMERICA
BEFORE THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
WASHINGTON, D. C.
In the Matter of the Application of
ASBURY PARK AND OCEAN GROVE BANK
tor approval of merger with
The Central Jersey Bank and Trust Company
41.
•••
ORDER DENYING APPLICATION FOR APPROVAL OF MERGER OF BANKS
There has come before the Board of Governors, pursuant to
the Bank Nerger Act of 1960 (12 U.S.C. 1828(c)), an application by
k8burY Park and Ocean Grove Bank, Asbury Park, New Jersey, a member
bank of the Federal Reserve System, for the Board's prior approval of
the merger
of The Central Jersey Bank and Trust Company, Freehold,
/ Jersey, with and into Asbury Park and Ocean Grove Bank, under the
lel,
'
charter of the latter and title of The Central Jersey Bank and Trust
e°111PanY.
Notice of the proposed merger, in form approved by the Board,
as Published pursuant to said Act.
Upon consideration of all relevant materials in the light
Of
the factors set forth in said Act, including reports furnished by
the Comptroller of the Currency, the Federal Deposit Insurance Corporation,
and the
Department of Justice on the competitive factors involved in the
°Posed merger and the information received at and in connection with
'
Pl
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
2,
-2-
the public proceeding which was ordered in this matter (27 Federal
Register
4575) pursuant
to the Board's Rules of Procedure
(12 C.F.R. 262.2(f)(:)),
IT IS HEREBY ORDERED, for the reasons set forth in the
Boardts Statement of this date, that the said applicaticn be and
hlreby is denied.
Dated at Washington, D. C., this 29th d31 of June, 1962.
By order of the Board of Governors.
Voting for thir action: Chairman rartin, and
Governors Bald:.r8ton; Mills, RobQrtson, and Shepardson.
Absent and not voting: Governors King and Mitchell.
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
(SEAL)
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
Item No. 211-
6/29/62
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
APPLICATION BY ASBURY PARK AND OCEAN GROVE BANK
FOR APPROVAL OF MERGER WITH
THE CENTRAL JERSEY BLINK AND TRUST COMPANY
STATEMENT
Asbury Park and Ocean Grove Bank, Asbury Park, New Jersey
("Asbury Bank"), with deposits of $33.7 million, has applied, pursuant
to the Bank Merger Act (12 U.S.C. 1828(c)), for the Boardts prior
approval of the merger of that bank and The Central Jersey Bank and
Trust Company, Freehold, New Jersey ("Central Jersey"), with deposits
Of $75 million.
Under the Agreement of Merger, the banks would merge
Under the charter of Asbury Bank and the title of Central Jersey. The
resulting bank's facilities would consist of the five offices of
Asbury Bank and the ten offices of Central Jersey, the main office of
\glitch would be the main office of the resulting bank.
To assist the Board in its consideration of the matter, a
Public proceeding in the form of an oral presentation before members
Of_
the Board,pursuant to section 262.2(f)(3) of its Rules of Procedure,
Ills ordered (27 Federal Register
4575) and
conducted on the application,
and views and other data urging both approval and disapproval of the
4PPlication were submitted at such proceeding.
Under the law, the Board is required to consider (1) the
financial history and condition of each of the banks involved, (2) the
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
-2-
adequacy of its capital structure, (3) its future earnings prospects,
(4) the general character of its management, (5) whether its corporate
Powers are consistent with the purposes of 12 U.S.C., Ch. 16 (the Federal
Deposit Insurance Act)) (6) the convenience and needs of the community to
be served) and (7) the effect of the transaction on competition (including
any tendency toward monopoly). The Board may not approve the transaction
unless, after considering all these factors, it finds the transaction to
be in the public interest.
Banking factors. - While none of the first five factors
enumerated above--the "banking factors"--has been urged as a basis for
the approval of the application, both Asbury Bank and Central Jersey
al'e in satisfactory condition. The earnings prospects of each bank
4.1‘e favorable. They are both well-managed. There is nothing to suggest
a'V inconsistency with the purposes of 12 U.S.C., Ch. 16. Although con8iderations relating to the banking factors are not inconsistent with
approval of the proposal, they are not necessarily determinative of
the
matter but must be balanced with considerations relating to the
"laining statutory factors.
Convenience and needs of the communities to be served. 481)417 Park (population about 17,400) is located on the Atlantic Ocean,
55 miles from New York City. It is the leading shore resort of
lionniouth County, New Jersey, and is an important retail center. Although
the
city will probably continue to be an important residential and
e°11mercial community, it is already well developed and its growth
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
60
_3_
prospects are therefore limited.
Freehold, New Jersey (population
9,200), the seat of Monmouth County, is about 15 miles west of
Asbury Park.
Monmouth County (population about 335,000), with some 40 to
50 miles of Atlantic Ocean shore line, has had an increase of almost
JO per cent in population since 1950, and the prospects for continued
residential and industrial growth of the County are favorable.
Virtually
all the County's recent development has taken place in the eastern part
ef the County, which includes Freehold and Asbury Park.
Asbury Park proper is served by the main office and a branch
of Asbury Bank and by the main office and a branch of the Countyts
third largest bank.
Within a radius of two miles from downtown, however,
are seven other offices of commercial banks, three of Asbury Bank and
four of Central Jersey. These three offices of Asbury Bank are located
at Ocean Grove, Ocean Township, and Neptune Township.
Two of the four
Central Jersey offices are located at Allenhurst (considered by the bank
48 one office), and the other two are located at Bradley Beach and
Ileptune City.
All of the banking offices within the area just described
are in close and convenient proximity.
would serve the
The contention is made that the merger
C°untyts needs and convenience by increasing from some $5381000 to
about $888,000 the lending limit of Central Jersey, already the
highest in Monmouth County. However, although industry has moved
into the County at a sizeable rate, and the dollar amount of loans held
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Federal Reserve Bank of St. Louis
24 CI
-4bY commercial banks has increased, there is little evidence of any
substantial need for a larger lending limit than that now available
In the County. From the record it appears that Central Jersey, although having the highest loan limit in the County, has had no more
than isolated instances of demands for credit in excess of such limit.
Participations by Central Jersey do not indicate that such transactions
were necessary because of the bankts loan limit. Thus, although there
!lay be some advantage in increasing Central Jerseyts lending limit,
there has not been shown a substantial public need for such an increase.
It is also claimed that the Asbury Park community would be
benefited by the extension of Central Jerseyts specialized services to
Asbury Bankts offices.
However, such services would appear to be
already available at th,, Central Jersey offices located near Asbury Park.
Competition. - As already indicated, four offices of Central
Jersey and all five offices of Asbury Bank are located within a two-mile
rAdius of downtown Asbury Park. The nearest offices of each bank are
Within a few blocks of one another. The four offices of Central Jersey,
which were recently acquired by merger, represent about 36 per cent of
Central Jerseyts total deposits.
AsburY Bankts total deposits.
This is an amount almost equal to
Thus, the evidence suggests considerable
competition between the two banks.
Furthermore, even greater competi-
ticn !lay be expected as Asbury Bank continues its progress in changing
Past
conservative policies, and as Central Jersey resolves the problems
cr meshing operations of its newly acquired offices in the Asbury Park
•
elnity.
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Federal Reserve Bank of St. Louis
2.16?
r•
At present, the three commercial banks in the Asbury Park
area almost equally divide the area's commercial bank deposits.
Approval of the proposed merger would leave the resulting bank with
Close to two-thirds of these deposits, Perhaps even more important
in terms of competition, the resulting bank would then operate nine
Of the eleven banking offices and facilities in the Asbury Park area.
In support of the application, proponents urged that the
situation be considered on the basis of the area within a six-mile
radius of downtown Asbury Park.
But even on this basis, the resulting
bank would hold over 42 per cent of the area's commercial bank deposits.
The remainder would be distributed among 14 offices of other commercial
banks. In any event, use of the enlarged area tends to obscure the
significance of the dominant position which would be acquired by the
resulting bank in the Asbury Park area.
In terms of total deposits, Asbury Bank is the fourth largest
and Central Jersey the second largest bank in the County. The resulting
bank would be the largest.
Consummation of the merger, therefore, would
increase substantially the already large concentration of banking resources in the three largest banks.
These banks then would hold approxi-
Illately 70 per cent of the deposits, 72 per cent of the loans, and 63 per
Cent of the offices of the County's commercial banks.
The remaining
ten smaller banks have few branches and, unlike the three largest banks,
do not
compete significantly on a county-wide basis.
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Federal Reserve Bank of St. Louis
-6
Summary and conclusion. - The proposed merger would eliminate
the substantial competition between Asbury Dank and Central Jersey.
The resulting bank would obtain a dominant position in the Asbury Park
area where it would operate nine of the eleven banking offices and
facilities and would hold almost two-thirds of the area's commercial
bank deposits.
On a county-wide basis, the merger would eliminate the
fourth largest bank and increase the concentration of resources in the
three largest banks.
Although some benefit to the County might accrue through the
increased loan
limit of the resulting bank, there is no substantial
evidence that such an increase in the limit is needed.
Moreover, the
specialized services of Central Jersey which would become available at
Asbury Bank offices are already conveniently accessible to the Asbury
Park community.
Any benefits that might accrue to the public as a
result of the merger would be more than offset by the substantial
d
iminution of competition and the elimination of one of the three banks
serving the Asbury Park area.
Accordingly, the Board is unable to find that the proposed
merger would be in the
public interest.
June 29, 1962.
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Federal Reserve Bank of St. Louis
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
Item No. 25
6/29/62
WASHINGTON 25, D. C.
ADDRESS OfFICIAL CORRESPONDENCE
TO THE BOARD
July 2, 1962
CONFIDENTIAL (FR)
Mr. Paul C. Stetzelberger, Vice President,
Federal Reserve Bank of Cleveland,
Cleveland 1, Ohio.
Dear Nr. Stetzelberger:
In accordance with the request contained in
your letter of June 25, 1962, the Board approves the appointment of Robert H. Farber, Jr., as an assistant examiner for the Federal Reserve Bank of Cleveland. Please
advise the effective date of the appointment.
It is noted that Mr. Farber is indebted to The
Ohio National Bank and The Huntington National Bank,
both located in Columbus, Ohio. Accordingly, the Board's
approval of Mr. Farber's appointment is given with the
understanding that he will not participate in the examination of either bank to which he is indebted until such
indebtedness has been liquidated.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
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Federal Reserve Bank of St. Louis
4)
BOARD OF GOVERNORS
«R
Item No. 26
6/29/62
OF THE
.
4- 02601,;`'0
v(/'
"
1- V
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101
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
**
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
*/
4411. rtts **.a
'
4'3000***
July 2, 1962
Mr. Howard D. Crosse, Vice President,
Federal Reserve flank of New York,
New York 45, New York.
Dear Pr. Crosse:
I
Enclosed are copies of letters calling for reports of condition as of June 301 19620 from the following foreign banking and
foreign financing corporations in the Second District operating under
the provisions of Section 25 and Section 25(a) of the Federal Reserve
Act:
Bankers Company of New York
Chase Manhattan Overseas Corporation
The Gallatin Company, Inc.
International Banking Corporation
Virgin Islands National 'rank
Bank of AMerica
Bankers International Corporation
Bankers International Finaneinr Company, Inc.
Chao International Investnnt Corporation
Chemical International Paal-ing Corporation
Chemical International Finance, Ltd.
Continental International Planking Corporation
The First Bank of Boston International
Manufacturers Hanover International ranking Corporation
Manufacturers Hanover International Finance Corporation
Morgan Guaranty International. Panking Corporation
Morgan Guaranty International Finance Corporation
Western Bancorporation International flank
You will observe that the letters request that the reports
called for be submitted in duplicate to the Federal Reserve Plink for
transmittal to the Board of Governors.
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Federal Reserve Bank of St. Louis
-2.Upon receipt of the reports it will be appreciated if you will
have a proof made of the footings and obtain the correction of any obvious
errors in the reports. Please forward the original copy of the reports to
the Board and retain a copy for your files.
A complete review of the r9ports will be made in the Board's
Division of Examinations, and any correspondence which may be necessa
ry
as a result thereof will be initiated by the Board with a
-copy to you
for your information.
Very truly yours,
"7v-7ter?
Kenneth A. Yenyon,
Assistant Secretary.
Enclosures
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Federal Reserve Bank of St. Louis
2467
BOARD OF GOVERNORS
.•
****
,,4,
*74
,
:o CO GOkt
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Item No. 27
6/29/62
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
*
At
ADDRESS OFFICIAL CORRESPONDENCL
-0
TO THE HOARD
4**
VAS o
• •
octois.**-
July 2, 1962
Mr. Howard D. Crosse,
Vice President,
Federal Reserve Bank of New York,
New York 45, New York.
Dear Mr. Crosse:
Supplementing Mr. Kenyon's letter of this date,
enclosed are copies of letters calling for reports of condition, as of June 30, 1962, from the following corporations
in the Second District operating under the provialJns of
Section 25(a) of the Federal Reserve Act:
Chase Manhattan Overseas Banking Corporation
First National City Overseas Investment Corporation
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
Enclosure
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Federal Reserve Bank of St. Louis
ti C--73
Item No. 28
BOARD OF GOVERNORS
6/29/62
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS arriciAL CORRESPONDENCE
TO THE BOARD
July 2, 1962
Mr. B. F. Groot, Vice President,
Federal Reserve Bank of Boston,
Boston 6, Massachusetts.
Dear Mr. Groot:
Enclosed is a copy of a letter dated today, addressed
to Boston Overseas Financial Corporation, calling for a report
of condition as of June 30, 1962. You will observe that the
letter requests that the report called for be submitL,C in
duplicate to the Federal Reserve Bank for transmittal to the
Board of Governors.
Upon receipt of the report it will be appreciated if
You will have a proof made of the footings and obtain the correction of any obvious errors in the report. Please forward
the original copy of the report to the Board and retain a copy
for your files.
A complete review of the report will be made in the
Board's Division of Examinations, and any correspondence which
may be necessary as a result thereof will be initiated by the
Board with a copy to you for your information.
Very truly yours,
45
:
1 1"1-41XO
Kenneth A. Kenyon,
Assistant Secretary.
Enclosure
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Federal Reserve Bank of St. Louis
`‹.
BOARD OF GOVERNORS
Item No. 29
6/29/62
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
July- 2, 1962
Mr. Joseph R. Campbell, Vice President,
Federal Reserve Bank of Philadelphia,
Philadelphia 1, Pennsylvania.
Dear Mr. Campbell:
Enclosed are copies of letters dated today, addressed
to First Pennsylvania Overseas Finance Corporation and Philadelphia
International Investment Corporation, calling for r - rts of condition as of June 30, 1962. You will observe that the letters
request that the reports called for be submitted in duplicate to
the Federal Reserve Bank for transmittal to the Board of Governors.
Upon receipt of the reports it will be appreciated if
you will have a proof made of the footings and obtain the correction of any obvious errors in the reports. Please forward the
original copy of the reports to the Board and retain a copy for
your files.
A complete review of the reports will be made in the
Board's Division of Examinations, and any correspondence which
may be necessary as a result thereof will be initiated by the
Board with a copy to you for your information.
Very truly yours,
-^-,
):7;144,7
X,14,
2i,77.4"L
Kenneth A. Kenyon,
Assistant Secretary.
Enclosure
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Federal Reserve Bank of St. Louis
@FedFRASER