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ERS A meeting of the Board of Governors of the Federal Reserve System /las held in Washington on Monday, June PRESENT: Mr. Mr. Mr. Mr. 1940, at 11:30 a.m. Ransom, Vice Chairman Szymczak Davis Draper Mr. Mr. Mr. Mr. The 7 Morrill, Secretary Bethea, Assistant Secretary Carpenter, Assistant Secretary Clayton, Assistant to the Chairman action stated with respect to each of the matters hereinafter 4terred to was taken by the Board: The minutes of the meeting of the Board of Governors of the Niel, 41Reserve System held on May Z1, 1940, were approved unanimously. Mr• Morrill stated that in accordance with the previous dis48 which he had had with members of the Board and the authority '1i4t1t" kr them, and vith the approval of Mr. Paulger, Chief of the :781°11 Of xaminations, arrangements had been completed for the trans' r q a. C. Noe11, Assistant Secretary, to the Division of Examina4°448 a Federal Reserve Examiner and for the transfer of Fred A. t, Federal Reserve Examiner, to the Position of Assistant Secretary tli lite 8tarY eere t s Office, it being understood by all concerned that ti4e r4118fers Would become effective on June 10, 1940, that for the it iv beiL11 there tould be no change in Mr. Nelson's salary although IN:8 EPIPlated ktet e4 ill his new NI'4" that elqtation that if he sho-ed the anticipated aptitude and duties his salary would be increased at an early Mr. Noell's salary would be determined after further with Mr. Paulger and the members of the Board after it 6/v40 —2— was der. 1113-telY determined Thether Mr. Noell would be assigned to the field f°I.Ce of the Division of Examinations. The transfers were approved unanimously, effective as of June 10, 1940, and Mr. Noell was appointed an examiner to examine Federal Reserve Banks, member banks of the Federal Reserve System, and corporations operating under the provisions of Sections 25 and 25(a) of the Federal Reserve Act, for all nurposes Of the Federal Reserve Act and of all other Acts of Congress pertaining to examinations made by, for, or under the direction of the Board of Governors of the Federal Reserve System, and was designated as a Federal Re— serve Examiner. Me morandum dated May 29, 1940, from Mr. Carpenter, Assistant S, ec4.etar , -4, r.-ueommending that, for the reasons stated in the memorandum, ?kir anen, ta),. Chief Telegraph Operator in the Office of the Secre— 'Who i °- Past 55 years of age, be retired as of August 1, 1940, kcl that the Board make such special contribution to the Retirement 'etetlii Of +1, _ tilev,a ea4 Ai'"e Federal Reserve Banks as may be necessary ($211,70) to — 011 ktIlarn r. Mulranen's retirement allowance to the rate of ,1'..,600 per a life basis. Approved unanimously. Memo__ .--a.ndum dated May 31, 1940, from Mr. Morrill recommending r0, 4- the kb reason stated in the memorandum, Bruce C. Bishop be —Ated Ntiott a Page in the Office of the Secretary, with salary at the ' 1 080 Per annum, effective as of the date upon which he 4 111104 +1. '"e performance of his duties after having passed satis— '44' the usual physical examination. '444 Approved unanimously. 828 6/z/40 -3Memorandum dated May 29, 1940, from Mr. Paulger, Chief of the 14N1811 of Examinations, recommending that, for the reason stated in thel -4andum, Mrs. Nancy R. Porter he appointed on a permanPnt : 4818 48 a stenographer in the Division, with salary at the rate or annum, effective as of the date upon which she enters upon Der4f"ilence of her duties after having passed satisfactorily the 11811a1 physical examination. Approved unanimously. 4e/lorandum dated May 24, 1940, from Mr. Goldenweiser, Director °r the ti , t -vision of Research and Statistics, recommendin_g that, for tie reas °n stated in the menorandum, Mrs. Thelma L. Hutchison be —ced 4kths a. temporary basis for a period of not to exceed three a5 a clerk in that Division, with salary at the rate of U20 1(311th Derrort 1 effective as of the date upon which she enters upon the ellee of her duties. Approved unanimously. Letter to Mr. John G. Nichols, Chief, Division of Examination, Der, v'elt Insurance Corporation, reading as follows: 4ter:In accordance with your verbal request, the Board of kvtiti;, , °rs of the Federal Reserve System hereby grants Sectir : ;onsent, in accordance with the provisions of sub(k) (2) of section 12B of the Federal Reserve Act, tiotietaillillers for the Federal Deposit Insurance CorporaInake nach examination o the First Citizens Bank glzireW4et Company of Utica, Utica, New York, as nay be reto consummate the rehabilitation program for that 131WeerIns for which, it is understood, have been corn- Approved unanimously. 829 6/t/40 -4Letter to the Presidents of all Federal Reserve Banks, reading a8r°11ows. #8,12)"The Board's letter of i.larch 16, 1939 (5-149) (F.R.L.S. 13( outlined the general principles agreed upon by the po`Td, the Comptroller of the Currency, and the Federal Deti.84't Insurance Corporation rith respect to the administra: r °f Regulation U as annlicable to nationsl banks, State ID% banks, and nonmember insured banks. De Sub sequently the cooperation of the State Banking te eartillents was sought in extending the administration of s42egulation on a somewhat similar basis to noninsured State banks. The matter was discussed with Mr. Villiam R. thE;t11 SuperintPndent of Banks of New York and Chairman of ors xeoutive Committee, National Association of Supervisors ,11te Banks. Vie have now been advised that thus far 44 State Bank Supervisors have agreed to cooperate in pro ' - 111inistration of Regulation U in accordance with the 4ram outlined by Mr. Vihite in his letter of February 5, vie() to the members of the National Association of SuperState Banks. The four States which remain to be he d Penn fr°m are Louisiana, Mississippi, New Jersey, and sYlvania. 4 closed for your information is a copy of Mr. 7hitels lette cooper and it is assumed that the Reserve Banks will klurate to the fullest extent with the State Banking De114 entsin this work along the lines indicated. The Board of:fie-Pressed to Mr. nite its appreciation of his good 4atiorel:7,and the cooperation shown by the members of tilz atIgees : .-1- Association of Supervisors of State Banks. is kite ;ied that you might wish to express to the heads of the atton azking Departments in your district your own appreciof their cooperation." Approved unanimously, together with a letter to Mr. William R. White, Superintendent of Banks of the State of New York, reading as follows: the he Board is in receipt of advice from Mr. Gidney, of eueral Reserve Bank of New York, to the effect that air 't4 of the State Bank aupervisors have expressed b, ti_04 uillingn3s to cooperate in the administration of Reg144 46kr ,• raw in accordance with the program discussed with you - board ;eery Chief of the Board's Division of Examinations. OU as asked me to express to you its appreciation of O thg e°N °d °faces and the cooperation shown by the members ational A ssociation of Supervisors of State Banks." 830 -5Memorandum dated June 1, 1940, from Mr. Smead, Chief of the M.on of Bank Operations, recommending that the balance of approxi- 44tel $6,000,000 of the Netherlands Bank with the Federal Reserve "ew York, which is now carried as a balance of the Netherlands 6e rilinetit) be included in the weekly statement of condition of FedfL erve Banks against the caption "Other deposits" rather than xl1Et the present caption "Deposits-Foreign bank". The memorandum Btat that it was understood that if and when the proposed chmge bee '44e effective the entire account would be carried by the Federal Bank NI Reserve of New York instead of being participated with other FedBanks as at present. Approved unanimously. Letter -ver to Mr. Walter Lichtenstein, Secretary of the Federal 44i1/ tkt 'Y. `4111C11, reading as follows: sut "The Board of Governors has given consideration to the te:ents submitted by the Federal Advisory Council at the ri4iy :g with the Board on May 21, 1940, and has asked me to tY°u as follows with respect thereto: raeritp - review is bPinu made, in the light of recent developOf the Provisions of law which prohibit the 1?.scignt &Be Of claims - on the United States. As soon as this review the( 012 eted, the Board will give further consideration to s recommendation the find form of %,hich has N 4'een received by the Board) and advise you of the 4.on reached. 18 You have undoubtedly observed from the press, there e likelihood that the Jones-Wheeler bill (H.R.8748 er;:) will be passed at this session of Congress and 01 6- !et there has been substituted therPfor a new bill ' 1'4140 ' 4' 1 which was introduced by Mr. Jones on May 21. CoPies each of an analysis of the new bill and a (1 C01 On Section 4 of the bill which was sent by the Board 41niteqreesman Jones as Chairman of the House Committee on 1Lture under date of May 23, 1940, are enclosed here- 1 4 e 831 vt/40 -6with f , -or the information of the Council. Because of these „]ffe-L°Pments, the Board is taking no action in connection the stateffient submitted by the Council on the Jonesmeeler bill. 214 "Inasmuch as Brown indicated at the meeting on May Lo' hat the first of the two amendnents to Regulation U, stans by Banks for the Purpose of Purchasing or Carrying „"ks Registered on a National Securities Exchange, suged by +1, the Council might be discussed at the next meetinv " Council, the Board is taking no action with respect there niearf t°• Consideration will be given to the second amendpel ° Regulation U suggested by the Council, which would 107" a bank to take over from a broker an undermargined de for the purpose of purchasing or carrying securi' s and the Council will be informed of the Board's cleci 81:on as promptly as possible. dra The attention of the members of the Board has been : ta 11 to the memorandum which you left with me, following withraci"tinR on May 21, in which you stated that the Council easy, rew its request that its statement on the subject of Pecf, ,1eldr be published in the forthcoming issue of the e 111° Of Reserve Bulletin and will reconsider the question hopPeublication at its September meeting by which time it thats,to have from the Board any comments on the statement tuthe Board may desire to make. t is assumed that as soon as the Council has appointed 4, Commi gesti;Lutee to discuss with the Board the comments and sugcolma 118 which the members of the Council wish to make in ' stairtion with the Banking Studies prepared by the Board's 'You will advise us accordingly." 50V Approved unanimously. Thereupon the meeting adjourned. 4bV.4TU-e—L Secretary.
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