The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
Minutes of actions taken by the Board of Governors of the Ilecleral Reserve System on Monday, March 15, 1948. PRESENT: Mr. Mr. Mr. Mr. Szymczak, Chairman pro tem. Draper Evans Clayton Mr. Mr. Mr. Mr. Carpenter, Secretary Sherman, Assistant Secretary Morrill, Special Adviser Thurston, Assistant to the Board Minutes of actions taken by the Board of Governors of the Ner'al Reserve System on March 12, 1948, were approved unanimously. Memorandum dated March 12, 1948, from Mr. Leonard, Director or he Division of Examinations, recommending that the resignation O "ert J. Schoenhoff, an Assistant Federal Reserve Examiner in tb t Division, be accepted to be effective, in accordance with his l'eclIzest, at the close of business March 27, 1948, with the under8.4111'1111g that a lump sum payment would be made for annual leave lier4ii11i1g to his credit as of that date. Approved unanimously. Letter to Mr. Fulton, Vice President of the Federal Reserve °f Cleveland, reading as follows: "In accordance with the request contained in .°1.1r letter of March 8, 1948, the Board approves he appointment of Carl E. loll as an assistant _!,caminer for the Federal Reserve Bank of Cleveland. -rlease advise us of the date upon which the appointillent is made effective and also as to salary rate." Approved unanimously. 366 3/15/48 -2Letter to Mr. Fulton, Vice President of the Federal Reserve 11811k of Cleveland, reading as follows: "In accordance with the request contained in your letter of March 8, 1948, the Board approves the appointment of William Floyd Kaufman as an assistant examiner for the Federal Reserve Bank of Cleveland. Please advise us of the date upon which the appointment is made effective and also as to salary rate." Approved unanimously. Letter to Mr. Leach, President of the Federal Reserve Bank or Ri chmond, reading as follows: "In accordance with the request contained in your letter of March 9, 1948, the Board approves the appoint'Rent of Percy Wray Jennings as an assistant examiner for he Federal Reserve Bank of Richmond. It is noted that 41% Jennings will receive an annual salary of $3,600. If the appointment is not made effective May 1, 1948, 8.s Planned, please advise us." Approved unanimously. Letter to the board of directors of the "Columbia Bank of .rbor `'itY", Tampa, Florida, stating that, subject to conditions of 440) elsShip numbered 1 to 3 contained in the Board's Regulation H, the B °Iltrd approves the bank's application for membership in the eal Reserve System and for the appropriate amount of stock 111 thch. Federal Reserve Bank of Atlanta. Approved unanimously, together with a letter to Mr. McLarin, President of the Federal Reserve Bank of Atlanta, reading as follows: 367 3/15/48 -3- "The Board of Governors of the Federal Reserve System approves the application of the Columbia Bank of Thor City, Tampa, Florida, for membership in the Federal Reserve System, subject to the conditions prescribed in the enclosed letter which you are requested to forward to the board of directors of the institution. 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 State Comptroller for the State of Florida, for his information. "It is noted that fifteen directors are provided for in the bank's charter, whereas the membership examination report indicates that only nine directors are actually serving. The Florida statutes provide that a bank's directors may consist of not less than five nor more than twenty-five directors and the number may be increased or reduced within these limits with the approval of the comptroller. It is assumed that the comptroller's apProval has been granted for the reduced number of directors but this matter should be called to the bank's attention for any necessary corrective action." Letter to Mr. Volberg, Vice President of the Federal Reserve Of San Francisco, reading as follows: "Reference is made to your letter of March 8, 1948, 81110Mitting a certified copy of a resolution adopted by the Board of Directors of the Halsey State Bank, Halsey, °regon, signifying its intention to withdraw from memberShip in the Federal Reserve System and requesting waiver °f the six months' notice usually required. "In view of the Reserve Bank's favorable recommendation, the Board of Governors waives the usual requirement °f six months' notice, as requested. Accordingly, upon slirrender of the Federal Reserve Bank stock issued to the Halsey State Bank, Halsey, Oregon, the Federal Reserve 4"-nk is authorized to cancel such stock and make appropriate refund thereon. "It is noted the bank wishes the termination of its Membership to coincide with its acceptance for insurance bY the FDIC. In the circumstances, the bank will have four Months from the date of this letter to accomplish terminatlon of its membership. (F.R.L.S. #3548) In this connection 368 3/15/48 "the Washington office of the FDIC furnished the Board a copy of its letter dated March 8, 1948, to Supervising Examiner Funsten pertaining to the matter, a copy of Which is enclosed for your information. "Please advise the Board of Governors when cancellation is effected and refund is made. The Certificate Of Membership issued to the bank should also be obtained, if possible, and forwarded to the Board. The State banking authorities should be advised of the bank's Proposed withdrawal from membership and when it has been effected." Approved unanimously. Letter to "The Cosmopolitan National Bark of Chicago", Chicago, 4Iino1s, reading as follows: "The Board of Governors of the Federal Reserve System has given consideration to your application for fiduciary powers, and grants you authority to act, when riot in contravention of State or local law, as trustee, ezecutor, administrator, registrar of stocks and bonds, 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 national banks are Permitted to act under the laws of the State of Illinois, the exercise of all such rights to be subject to the provisions of the Federal Reserve Act and the regulations of the Board of Governors of the Federal Reserve System. "This letter will be your authority to exercise the fiduciary powers granted by the Board pending the Pl'eparation of a formal certificate covering such authorization, which will be forwarded to you in due coUrse,” Approved unanimously. Telegram to the Presidents of all Federal Reserve Banks readfollows: "At the recent joint meeting of the Presidents and the Board of Governors it was the consensus that a pro- 369 3/15/48 -5- cedure should be worked out whereby reserves would be set up to provide a more rapid amortization of premiums Oil Government securities. The Board on further consideration of this question believes that the most appropriate way to implement such a policy would be for the Federal Reserve Banks to make transfers from current net earnings to a reserve for premium on securities in accordance With the following procedure. 1. On March 31 set up a reserve equal to the amount of premium on Government securities amortized in the period January 1--March 31. 2. At the end of each month thereafter add to the reserve an amount equal to the premium amortized during the month, until the amount in the reserve equals the premium account. 3. If the amount in the reserve at the end of any month is in excess of the balance in the premium account, reduce the reserve to the amount in the premium account. "The procedure outlined refers to the total portfolio Of securities without reference to individual securities or increases and decreases therein due to purchases, sales, exchanges, and redemptions of securities, and does not contemPlate that there will be any adjustment of the reserves held bY the various Reserve Banks incident to any reallocation of Participations in the System Account. Under the method outlined net earnings on which payments to the U. S. Treasury on Federal Reserve notes are based would be reduced until sUch time as the reserve had been built up to an amount equal to the premium account. Thereafter net earnings Would be increased through reduction of the reserve until lt was exhausted. The amount of the reserve would be rePorted on Form 34 against the caption 'Reserves for contingencies; all other'. It will be appreciated if the Board can have your comments on the proposal outlined above not later than March 22, 1948, so that the changed Procedure can be brought to the attention of the Treasury arid put into effect by March 31 if that should be the decision." Approved unanimously Secretary. A131s°ved:
@FedFRASER