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83 ft A. meeting of the Executive Committee of the Federal Reserve Board was held in the office of the Federal Reserve Board on Monday, March 2, 1931, at 11:15 a. m. RESENT: PRESENT AT90: t. Governor Meyer Mr. Hamlin Mr. Miller Mr. Xames Mr. McClelland, Assistant Secretary. Mr. X. H. Case, Chairman of the Federal Reserve Bank of New York. The Assistant Secretary presented various communications and 'reports which were considered by the Board and acted upon as follows: Telegram dated February 27th from the Chairman of the Federal Ileserve Bank of Chicago, advising that the Board of Directors, at its meet- on that date, made no change in the bank's existing schedule of rates .0t d iscount and purchase. Without objection, noted with approval. Report of Committee on Salaries and Expenditures on letter dated illeblb"trY 25th from the Secretary of the Federal Reserve Bank of Cleveland, klcIllestille approval by the Board of an increase from ;6,000 to 7,5OO per 4111111111under the bank's personnel classification plan, in the maximum salary r°11 %e Position of Chief Exariner; the Board's Committee recommending 4Provea. Approved. Letter dated February 27th from the Secretary of the Federal Re- • aerve g ailk of Chicago, advising of an amendment to Article II of the bank's authorizinr, the board of directors to appoint from its members Dersot 8 to serve as members of the Executive Committee during the absence -1 ail 4 3/2/31 1/ -2- Of any of the regular members of that committee. Noted.' Memorandum from Counsel dated February 28th, submitting copy of Senate Resolution 305, agreed. to by the Senate on February 26th, which puts th Senate on record as being of the opinion that the Department of State 1148 110 authority with respect to foreign investment loans floated in this (41/11ntrY and that the Department should refrain from assuming authority over the Pederal Reserve Board and Federal Reserve banks, or officials thereof. Noted. Memorandum from Counsel dated February 27th, submitting draft of a resolution, prepared at the suggestion of Mr. Hamlin, prescribing a uniform 14/lioY for the Federal Reserve Board with respect to granting state member 44ks Permission to purchase stock in other banks; Counsel also submitting tlEtte, t -rola the Board's records regarding the condition of membership limiting t48 Purchase of bank stocks by member banks. Ordered circulated. Matter approved on initials by the Executive Committee on February 2eth -amely telegram to the Governors of all Federal Reserve banks, reading 48 f011OWS: "Bill increasing loan basis of adjusted service certificates beam, , vet:" law yesterday. Principal changes are (1) Loan value of Iral rezis certificate immediately increased to 50 per cent of face and (2) Rate of interest charged on loans made subsequent to erldnent must not in any event exceed 4 1/2 per cent, compounded re:tilallY. As to all loans made on or after February 27, 1931, the eze8 or interest must not exceed (a) simple interest at a rate not or . ei cling by more than 2 per cent the Federal reserve discount rate Ile district of the lending bank, or (b) 4 1/2 per cent interest arm : 01-17011nded annually, whichever is the lower. Regulation Grnmst be slightly to conform to these changes in law and new regulation 411817 be promulgated within next few days. In meantime, you may ex 'inquiries by saying that loans conforming to regulations with Z o 3/2/31 above changes will be eligible for rediscount; provided, of course, they conform in all other respects to the law, the Board's regulations, aM the regulations of the Administrator of Veterans' Affairs." Formally anproved. The Governor then made a short verbal report of a conference in his °trice this morning with General Frank T. Hines, Director of the Veterans' Ikreau, with regard to the extension of loans to veterans under the World 71111 'Adjusted Compensation Act, as amended, after which the Executive ecomittee had some discussion of the matter with Mr. Case. At this point Er. Miller left the meeting. • Reference was then made to the letter received from Deputy Governor Glibart of the Federal Reserve Bank of New York under date of February 4th, ii toq eating approval of several changes in the personnel classification plan °t tha NeW York bank, made effective before being submitted to the Board, °I1 Which action was deferred at the meeting of the Board on February 11, 1931. After some discussion, during which Mr. Case assured the Board that in the future no changes in the personnel classification plan of the New York bank will be made without first securing the approval of the Federal Reserve Board, the changes outlined in Mr. Gilbart's letter were approved. The Governor then submitted and the Board discussed with Mr. Case 4 11161310randum from Counsel dated February 12th with regard to reporting to the D ePartMent of JUstice possible violations of the Federal criminal atatilt 68 bY Mr. James Hume, Assistant Vice President of the Bank of Montclair, 1404% II/ °1411*, New Xersey, which Mr. Case had reported to the Board with a IllI geat• lon that they be not referred to the Attorney General; Counsel subg with his memorandum drafts of letters to the Attorney General crtiait e the matter to his attention for such action as he may consider itqvitiab le, which is in accordance with the Board's established policy, and 3/2/31 ,to the Federal Reserve Agent at New York requesting that he report the Better to the local United States Attorney. At the conclusion of.the discussion, upon motion, the letters submitted with Counsel's memorandum were anoroved and ordered transmitted. REPoRTs OF Dated., February 27th Dated, February 27th bated, February 27th Recommendinga change in stock at a Federal Reserve Bank, as set forth in the Auxiliary rdnute Book of this date. Recommendation approved. Recommending action on an application for fiduciary powers as set forth in the Auxiliary Minute Book of this date. Recommendation approved. Recorcuending action on an application for admission of a state bank, subject to the conditions stated in the individual report attached to the application, as set forth in the Auxiliary Minute Book of this date. Recommendation approved. The meeting adjourned at 12:00 orclock noon. Assistant Secretary. (PaeCiat lye Committee) ,AUXILIAdY MINUTES (March 2, 1931) Report of Standing Committee dated February 27th, recommending a u e"enge in stock at a Federal deserve Bank, approved as follows: 744.1111.2111K_OAIGINAL Stock: Pirst National Bank of Haddon Heights, N.J. Shares 90 90 0 Report of Standing Committee dated February 27th, recanmending action 11 an application for fiduciary powers by the following bank: DIST:AIOT NO. 7. ILLINOIS: The Edgar County National Bank of Paris. (3341) Report of Standing Committee dated February 27th, recommending action an application for admission to membership by the following state fl,stitution, subject to the conditions stated in the report attached to ""a application: APPliOVED: Name First State Bank, Aobert Lee, Texas. Shares F.d.Bank 42 Dallas Assistant Secretary.
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