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O9
1. 9/61
Minutes for
To:
Members of the Board
From:
March 2, 1962
Office of the Secretary
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
Minutes of the Board of Governors of the Federal Reserve System
on Friday, March 2, 1962.
PRESENT:
Mr.
Mr.
Mr.
Mr.
Mr.
The Board met in the Board Room at 10:00 a.m.
Mills, Acting Chairman
Robertson
Shepardson
King
Mitchell
Sherman, Secretary
Kenyon, Assistant Secretary
Thomas, Adviser to the Board
Young, Adviser to the Board and Director,
Division of International Finance
Mr. Fauver, Assistant to the Board
Mr. Noyes, Director, Division of Research
and Statistics
Mr. Holland, Adviser, Division of Research
and Statistics
Mr. Koch, Adviser, Division of Research and
Statistics
Mrs. Semia, Technical Assistant, Office of
the Secretary
Mr. Eckert, Chief, Banking Section, Division
of Research and Statistics
Mr. Yager, Chief, Government Finance Section,
Division of Research and Statistics
Mr.
Mr.
Mr.
Mr.
Money market review.
Mr. Yager reported on conditions in the
Government securities market, during the course of his remarks
distributing a table showing preliminary results of the Treasury's
advance refunding program.
Mr. Eckert then reviewed developments in
regard to bank credit, deposits, and reserves.
Messrs. Holland, Yager, and Eckert then withdrew from the
meeting and the following entered the room:
Mr.
Mr.
Mr.
Mr.
Molony, Assistant to the Board
Hackley, General Counsel
Solomon, Director, Division of Examinations
Farrell, Director, Division of Bank Operations
-2-
3/2/62
Mr. O'Connell, Assistant General Counsel
Mr. Shay, Assistant General Counsel
Mr. Goodman, Assistant Director, Division of
Examinations
Mr. Leavitt, Assistant Director, Division of
Examinations
Mr. Furth, Adviser, Division of International
Finance
Mr. Conkling, Assistant Director, Division of Bank
Operations
Mr. Partee, Chief, Capital Markets Section, Division
of Research and Statistics
Mr. Veenstra, Technical Assistant, Division of Bank
Operations
Discount rates.
The establishment without change by the
Federal Reserve Banks of New York, Philadelphia, Chicago, and San
Francisco on March 1, 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.
Items circulated or distributed to the Board.
The following
items, which had been circulated or distributed to the Board and copies
Of which are attached to these minutes under the respective item numbers
indicated, were approved unanimously:
Item No.
Letter to Boston Overseas Financial Corporation,
Boston, Massachusetts, granting consent to purchase
approximately 22 per cent of the stock of a factoring
corporation to be organized in The Netherlands.
1
Letter to The Farmers and Merchants State Bank,
Claflin, Kansas, interposing no objection to a
dividend declared in 1960.
2
Letter to the Comptroller of the Currency recommending favorably with respect to an application to
organize a national bank at Irving, Texas.
3
3/2/62
-3Item No.
Letter to Wells Fargo Bank, San Francisco,
California, approving the establishment of a
branch in Los Altos, Santa Clara County.
4
Order granting an extension of time within
which The First Virginia Corporation, Arlington,
Virginia, may acquire shares of Richmond Bank
and Trust Company, Richmond, Virginia.
5
With respect to Item No. 1, a letter had been received from the
Comptroller of the Currency in response to a request from the Board for
any comments he wished to make in regard to the proposed transaction.
The Comptroller's reply stated that, while he could see no reason why
the proposed investment should be disapproved, he invited the Board's
attention to the following points.
From an examination of the files,
it appeared that Boston Overseas Financial Corporation had been engaged
in financing exports to the United States, possibly in excess of the
amount of exports from the United States to the United Kingdom, and
that some further portions of its financing were utilized to facilitate
sales in third countries by foreign exporters.
Both of those categories
of exports, it might be assumed, competed in some degree with this
country's own production or exports.
Since it was his understanding
that the Edge Act was designed "to foster our exports," question might
be raised whether those activities conformed to that purpose.
In continuing, the Comptroller's letter mentioned that some
elements of United States public policy had the broader purpose of
freeing the channels of international commerce.
However, the Edge
tif
3/2/62
Act, and the recently expanded export credit insurance program, seemed
to him to have a narrower objective.
This issue was particularly
pertinent in view of present efforts to deal with the United States
balance of payments problem.
He trusted that it would receive the
Board's careful consideration in this and similar applications.
Governor Mills questioned the views expressed by the Comptroller in regard to the purpose of the Edge Act.
AS Governor Mills
understood it, the purpose of the Act was to promote financial
engagements involving both export and import trade.
The Board had
not discouraged investments in diversified foreign ventures, such,
for example, as extracting petroleum, having felt that such investments
were appropriate for Edge Act financing corporations, especially in
underdeveloped countries.
The factoring operations did introduce a
somewhat different slant, perhaps, because they involved financing
the operations of foreign manufacturers who might compete with United
States manufacturers.
Yet it seemed almost impossible to distinguish
or isolate the kinds of financing an
Edge Act corporation could under-
take that would fall within the criteria suggested by the Comptroller,
that being true especially when investments by Edge Act financing
corporations in foreign countries were involved.
It seemed obvious
that those corporations would engage in a whole range of financing
which in a sense might be disadvantageous from the standpoint of the
present balance of payments problem but nevertheless would be within
the purview of the Edge Act.
3/2/62
-5In the ensuing discussion, comments by the staff reflected
general agreement with the views expressed by Governor Mills.
Consideration then was given to whether or not a reply should be
made to the Comptroller of the Currency's letter.
The consensus was
that no reply was necessary; the letter had been received in response
to an invitation for comments on the specific transaction proposed by
Boston Overseas Financial Corporation.
It was agreed that any study
of the broader question touched upon in the Comptroller's letter might
more appropriately be a part of the over-all review of Regulation K
that was now in process, in which connection a letter had been sent
to the Comptroller inviting his comments.
Messrs. Shay, Furth, and Goodman then withdrew from the meeting.
Call report data
(Items 6,
7, and 8). A memorandum dated
February 27, 1962, from the Division of Bank Operations, which had
been distributed, recommended that the Board approve an attached draft
of Schedule J--Supplementary Data on Obligations of States and Political
Subdivisions, and Loans for Purchasing or Carrying Securities, for use
at the forthcoming spring call date, provided that corresponding data
were obtained from national banks and insured nonmember banks.
The
purpose of the proposed Schedule J was to collect current information
on (1) the maturity distribution of commercial bank holdings of securities issued by States and political subdivisions, and (2) the breakdown
of loans for the purpose of purchasing or carrying securities between
-6-
3/2/62
loans to purchase United States Government securities and other securities.
The supplement would be similar to one used in June 1956, with
exceptions noted in the memorandum.
The need for current information in those areas arose from
d
the fact that bank portfolios of tax-exempt securities had expande
e
sharply since the last supplement was collected, and there was evidenc
that the maturity distribution might have changed substantially.
New
of changes
benchmark data were needed on which to base current estimates
in commercial bank holdings of those securities.
The new data would be
tion reports,
used, along with information compiled from current examina
for that purpose.
A more current benchmark than that provided in 1956
purchasing or
was needed for the breakdown of loans for the purpose of
carrying securities in order to assess the adequacy of the weekly
reporting member bank series as an indicator of changes in stock
market credit.
The weekly series already provided for the breakdown
securities.
of those loans as between United States Government and other
Attached to the memorandum was a draft of letter to the Federal
Reserve Banks that would transmit forms for the coming call report,
including the proposed Schedule J.
The letter included two paragraphs
explaining the purpose of the new schedule.
Drafts of letters to the
ce Corporation,
Comptroller of the Currency, the Federal Deposit Insuran
and the Budget Bureau were also attached.
-7-
3/2/62
Mr. Conkling stated that the letter to the Federal Reserve Banks
was a routine matter, except for Schedule J.
He noted that the memo-
randum indicated that the collection of the data called for by
Schedule J had been discussed with representatives of the Office of
the Comptroller of the Currency and the Federal Deposit Insurance
Corporation, and it had been understood that the staffs of those
agencies would recommend to their principals that the data be
collected from national and insured nonmember banks.
That was true
at the time the memorandum was written; however, in the meantime Mr.
Conkling had received a letter from a Deputy Comptroller of the
Currency asking a number of technical questions about the proposed
schedule, and it was understood that a written reply was desired.
Such a reply had been prepared and sent, but no further word had been
received.
Thus, there was some question as to whether or not the
Comptroller of the Currency would be willing to include the proposed
Schedule J in the reports to be called for from national banks.
In the light of that uncertainty, question was raised regarding
the letter proposed to be sent to the Reserve Banks.
After a discussion
of that point, it was the consensus that it would be well to omit
Schedule J from the list of forms mentioned in the letter to the
Reserve Banks, and also to omit the paragraphs explaining the purpose
of the schedule.
Instead, the usual forms should be transmitted, so
that the Reserve Banks could proceed with their necessary steps of
,
-8-
3/2/62
preparation for the call for condition reports, and the letter would
include a statement that the use of an additional schedule was under
consideration and, if it was to be included, information about it
would be sent as soon as possible.
The letter to the Reserve Banks was
then approved unanimously, with the changes that had been agreed upon
during the discussion.
A copy of the letter is attached as Item No.
6.
Also attached, as Item No. 7, is a copy of the letter sent to the Comptroller of the Currency on this matter.
A similar letter was sent to
the Federal Eeposit Insurance Corporation.
Attached as Item No. 8 is a
copy of the letter sent to the Budget Bureau.
Governor Mitchell asked if there was some way in which a
maturity breakdown of bank holdings of tax-exempt municipal securities could be obtained on a periodic basis from examination reports.
Comments in response indicated that the staff now had under consideration
a project, involving the use of a revised summary sheet on examination
reports, that was intended to develop information of this kind.
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 Boston (attached
Item No. 9) approving the appointment of John J. O'Connor and
Edward E. Crane as assistant examiners.
Letter to the Federal Reserve Bank of San Francisco (attached
Item No. 10) approving the appointment of Wayne C. Hall as assistant
examiner.
3/2/62
-9-
Memoranda from appropriate individuals concerned recommending
the following actions relating to the Board's staff:
Transfer
Marynoble Shissler, from the position of Clerk-Stenographer in the
Division of Personnel Administration to the position of Clerk-Stenographer
in the Division of Bank Operations, with no change in her basic annual
salary at the rate of $4,145, effective March 4, 1962.
Salary increases, effective March
4, 1962
Division
Name and title
Basic annual salary
To
From
Research and Statistics
Paul F. McGouldrick, Economist
Gail E. Mullin, Economist
$8,080
8,955
$8,34o
9,215
4,995
5,160
4,83o
4,995
4,285
4,390
3,605
3,920
3,710
4,025
Bank Operations
Judith M. Golodner, Secretary
Examinations
Ted Edward Garner, Assistant Federal Reserve
Examiner
Administrative Services
Vera L. Dulin, Supervisor
Lloyd G. Luna, Guard
Geraldine M. Venable, Clerk-Cashier
Secreta
BOARD OF GOVERNORS
OF THE
gl
Item No. 1
3/2/62
FEDERAL RESERVE SYSTEM
**.@
WASHINGTON 25, D. C.
:tug:
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
*%
4.
%.?Ad.tits
t'o04401,
March 2, 1962
Boston Overseas Financial Corporation,
67 Milk Street,
Boston 6, Massachusetts.
Gentlemen:
In accordance with the request contained in your letter of
January 11, 1962, transmitted through the Federal Reserve Bank of Boston,
and on the basis of the information furnished, the Board of Governors
grants its consent for Boston Overseas Financial Corporation ("BOFC") to
purchase and hold approximately 22 per cent of the stock of a corporation
to be organized under the laws of The Netherlands to be named International
Factors N. V. ("IFN") if that name is available at a cost not to exceed
$100,000, provided such stock is acquired within one year from the date
of this letter.
The Boards consent to the purchase of stock of IFN is granted
upon condition that BOFC shall dispose of its holdings of stock of IFN,
as promptly as practicable,, in the event that IFN 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 BOFC to be inappropriate
under the provisions of Section 25(a) of the Federal Reserve Act or regulations thereunder.
Upon completion of the organization of IFN, it is requested
that the Board of Governors be furnished (1) copies of the articles of
association and by-laws of IFN and (2) a list of the officers and directors
of IFN. Please advise the Board of Governors, through the Federal Reserve
sank of Boston, when the acquisition of stock has been made.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
BOARD OF GOVERNORS
01:0:11:14.4.0
4
,
0q4701t,iloo
,
ii 0 , ktbk
ti
. Ntk linf
OF THE
Item No. 2
3/2/62
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
tgLr
TO THE BOARD
March 2, 1962
Board of Directors,
The Farmers and Merchants State Bank,
Claflin, Kansas.
Gentlemen:
ve System
The Board of Governors of the Federal Reser
1962, written
has received a copy of a letter dated January 8,
Reserve Bank
by Mr. Robert L. Branan, Cashier, to the Federal
dividend of
of Kansas City respecting the declaration of a
ion of paragraph 6, Section 9,
$10,000 in 1960 in contravent
the United
of the Federal Reserve Act and Section 5199(b) of
dividend was declared without
States Revised Statutes. This
nors.
obtaining the approval of the Board of Gover
approval,
The statute contemplates the Board's prior
be given in this case since the
but such prior approval cannot
consideradividend has already been declared and paid. After
the Board will make no objection
tion of the facts, however,
This letter
to the declaration of the dividend mentioned above.
of dividends.
does not authorize any subsequent declaration
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
Item No. 3
3/2/62
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
March 2, 1962
Comptroller of the Currency,
Treasury Department,
Washington 25, D. C.
Attention Mr. G. W. Garwood,
Deputy Comptroller of the Currency.
Dear Mr. Comptroller:
Reference is made to a letter from your office dated
November 27, 1961, enclosing copies of an application to organize
a national bank at Irving, Texas, and requesting a recommendation
as to whether or not the application should be approved.
Information contained in the report of investigation of
the application by an examiner for the Federal Reserve Bank of Dallas
indicates that the proposed capital structure of the bank is adequate, that prospects for profitable operations are favorable, and
that the general character of management is regarded as satisfactory.
While there may be no urgent demand for additional banking facilities
in this area, there appears to be sufficient business to provide
profitable operations within a relatively short period. It is noted
that future growth of the community is expected to the north and
northwest, opposite the proposed location of the bank, and that
development of the immediate area to be served is said to be limited
to some extent by natural barriers. The Board of Governors recommends favorable consideration of the application.
The Board's Division of Examinations will be glad to discuss
any aspects of this case with representatives of your office if you
so desire.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
S09
BOARD OF GOVERNORS
OF THE
Item No. 4
FEDERAL RESERVE SYSTEM
3/2/62
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
March 2, 1962
Board of Directors,
Wells Fargo Bank,
San Francisco, California.
Gentlemen:
The Board of Governors of the Federal Reserve
System approves the establishment of a branch by Wells
Fargo Bank, San Francisco, California, in the downtown
business district of Los Altos, Santa Clara County,
California, provided the branch is established within
one year from the date of this letter.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
Si()
Item No. 5
UNITED STATES OF AUHICA
3/2/62
BEFCRE THE BOARD OF GOVERNCRS OF THE FEDERAL RESERVE SYSTEM
WASHINGTON, D. C.
In the Natter of the Application of
THE
FIRST VIRGINIA CCRPCRATION
for prior approval of acquisition of
voting shares of Richmond Bank and
Trust Corpany, Richmond, Virginia
ORDLR EXTITDING TUE FOR ACQUISITION OF
VOTING SHARES OF racia,ca BANK AND TRUST COITAITY
WHEREAS, by Order dated September 5, 1961, the Board of
Governors, pursuant to section 3(a)(2) of the Bank Holding Company Act
of 1956 (12 U.S.C. 1842) and section 4(a)(2) of Federal Reserve Regulation Y (12 CFR 222.4(a)(2)), approved the acquisition by The First
Virginia Corporation, Arlington, Virginia, of 80 per cent or more of
the voting shares of Pichmond Bank and Trust Company, Richmond, Virginia;
and, pursuant to request of The First Virginia Corporation, by Order
dated December 4, 1961, extended to ilarch
5,
1962, the time within which
the approved acquisition Iras to be completed; and
WHEREAS, The First Virginia Corporation has applied to the
Board for an additional extension of time of 30 days from Farch 5, 1962,
Within which to complete its acquisition of the shares of Richmond Bank
and Trust Company, and it appearing to the Board that good cause has
811
been shown for the additional time requested and that such extension
would not be inconsistent with the public interest;
IT IS HLIMBY ORDERED, that the time within which said acquisition shall be completed is extended to April 5, 1962.
Dated at Washington, ). C., this 2nd day of March, 1962.
By order of the Board of Governors.
(Signed) lierritt Sherman
Merritt Sherman,
Secretary.
(sEAL)
512
BOARD OF GOVERNORS
OF THE
Item No. 6
3/2/62
FEDERAL RESEFIVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS
orrictAL
CORRCIPONDCHOC
TO THE IBOARD
March 7, 1962
Dear Sir:
forwarded
The indicated number of copies of the following forms are being
t? your Bank under separate cover for use of State mem:ler banks and their affiliates in submitting reports as of the next call date. A copy of each form is
attached:
thulther of
Form FR 105 (Call No. 163), Report of condition of
State member banks,
Form FR 105e (Revised February 1961)0 Publisher's copy
of report of condition of State member banks.
Form 105e-1 (Revised February 1961), Publisher's copy
of report of condition of State member banks.
Form 105e-2 (Revised November 1955), Publisher's copy
supplement.
Form FR 220 (Revised March 1952), Report of affiliate
or holding company affiliate.
Form FR 220a (Revised March 1952), Publisher's copy of
report of affiliate or holding company affiliate.
30, 1961. ConAl]. of the forms are the same as those used on December
nal
e
sideration also is being given to the inclusion in the next call of an additio
this additpedule J. If a decision is reached among the agencies to request
ed later.
schedule from all insured commercial banks, it will be forward
that it would
"
0 18 schedule would be similar to the one used in June 19560 except
obligations and revenue bonds
the
c
" separate maturity breakdown between general
bonds, notes, and
States and political subdivisions and the breakdown of other
classification
(;13enture8 by type, which were reported in 1956; and a maturity
u4) to 20 years) of bonds issued by States and political subdivpdons has been
Very truly yours,
-closure
T0 THE PRESIDENTS OF ALL FEDERAL
RESERVE BANKS
A
, •
Merritt Shermario
Secretary.
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON
25,
D. C.
Item No. 7
3/2/62
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
March 5 1962
0
The Honorable James J. Saxon,
The Comptroller of the Currency,
Office of the Comptroller of the Currency,
Washington 25, D. C.
Dear Mr. Saxon:
The Board has approved the enclosed Schedule J/ a supplement to the report of condition of State member banks for use in
obtaining information on the maturity breakdown of obligations of
States and political subdivisions and the breakdown of loans for
purchasing or carrying securities as between U. S. Government and
other securities, at the forthcoming spring call date, provided corresponding data are obtained from national banks and insured nonmember
commercial banks.
The proposed schedule has been discussed with representatives
of your agency, a previous draft of the schedule having been transmitted
informally to Deputy Comptroller Fleming with a memorandum dated
January 25.
The purpose of the schedule is to collect current information
on (1) the maturity distribution of commercial bank holdings of securities issued by States and political subdivisions and (2) the breakdown
of loans for the purpose of purchasing or carrying securities between
loans to purchase U. S. Government securities and other securities.
This proposei supplement is similar to one used in June 1956,
except that it: (a) would omit the separate maturity breakdown between
general obligations and revenue bonds of States and political subdivisions; (b) would omit the breakdown of other bonds/ notes, and debentures
by type; and (c) would add an additional maturity classification(10 to 20
years) of bonds issued by States, and political subdivisions.
-X-.
The Honorable James J. Saxon
-2-
The need for current information in these areas arises
from the fact that bank portfolios of tax exempt securities have expanded sharply since the last supplement was collected and there is
evidence that the maturity distribution may have changed substantially.
Banks may have lengthened maturities in these securities to increase
investment income; comments to this effect have been noted in trade
publications, particularly in connection with the recent change in
Regulation Q increasing the maximum permissible rate of interest payable on time deposits. New benchmark data are needed on which to base
current estimates of changes in commercial bank holdings of these
securities, and the new data would be used with information compiled
from current examination reports for this purpose.
A more current benchmark than that provided in 1956 also is
needed for the breakdown of loans for the purpose of purchasing or
carrying securities in order to assess the adequacy of the weekly reporting member bank series as an indication of changes in stock market credit;
the weekly series already provides for the breakdown of the loans as
between U. S. Government and other securities.
It will be appreciated if you will advise the Board whether
Your office will use this schedule at the forthcoming spring call. A
similar inquiry is being made of the Federal Deposit Insurance
Corporation.
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
Enclosure
815
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
Item No. 8
3/2/62
WASHINGTON 25. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
March
5, 1962
Mr. David Cohn,
Clearance Officer,
Bureau of the Budget,
Washington 25, D. C.
Dear Mr. Cohn:
Enclosed are two copies of your Form 83 together with copies
Of a proposed Schedule J--.Supplementary Data on Obligations of States
and Political Subdivisions, and Loans for Purchasing or Carrying
Securities which would be submitted by State member banks of the Federal
Reserve System as a supplement to official reports of condition at the
forthcoming spring call date.
The Board is today transmitting this proposal to the Office
Of the Comptroller of the Currency and to the Federal Deposit Insurance
Corporation, with which informal discussions of the subject have already
been held, and it hopes that those agencies will conclude that similar
information should be requested in connection with call reports for
national and insured nonmember commercial banks. The Board's request
for approval of the proposed schedule is made, therefore, with the
understanding that the schedule would be used only in the event the other
agencies concurred in the desirability of collecting the additional
information.
The purpose of the proposed Schedule J is to collect current
information on (1) the maturity distribution of commercial bank holdings
of securities issued by States and political subdivisions, and (2) the
breakdown of loans for the purpose of purchasing or carrying securities
between loans to purchase U. S. Government securities and other securities.
This proposed supplement would be similar to one used in June
1956 except that it: (a) would omit the separate maturity breakdown
between general obligations and revenue bonds of States and political
subdivisions; (b) would omit the breakdown of other bonds, notes, and
debentures by type; (c) and would add an additional maturity classification
10 to 20 years) of bonds issued by States and political subdivisions.
(
BOARD OF GOVERNORS
Mr. David Cohn
or
THE FEDERAL RESERVE SYSTEM
-2-
The need for current information in these areas arises from
the fact that bank portfolios of tax exempt securities have expanded
sharply since the last supplement was collected and there is evidence
that the maturity distribution may have changed substantially. Banks
may have lengthened maturities in these securities to increase investment income; comments to this effect have been noted in trade publications, particularly in connection with the recent change in Regulation Q
increasing the maximum permissible rate of interest payable on time
deposits. New benchmark data are needed on which to base current estimates
of changes in commercial bank holdings of these securities, and the new
data would be used with information compiled from current examination
reports for this purpose.
A more current benchmark than that provided in 1956 also is
needed for the breakdown of loans for the purpose of purchasing or carrying
securities in order to assess the adequacy of the weekly reporting member
bank series as an indicator of changes in stock market credit; the weekly
series already provides for the breakdown of these loans as between U. S.
Government and other securities.
The schedule, in preliminary draft, has been discussed with
Mr. Crowder.
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
Enclosures.
BOARD OF GOVERNORS
OF THE
Item No. 9
FEDERAL RESERVE SYSTEM
3/2/62
‘ALASIT4INGTON a.5. D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
March 5, 1962
CONFIDENTIAL (FR)
Mr. B. F. Groot, Vice President,
Federal Reserve Bank of Boston,
Boston 6, Massachusetts.
Dear Mr. Groot:
In accordance with the requests contained in your letters
Of February 21, 1962, the Board approves the appointments of John J.
O'Connor and Edward E. Crane as assistant examiners for the Federal
Reserve Bank of Bostaa. Please advise as to the effective date of
the appointments,.
It is noted that Mr. O'Connor is indebted to The Broadway
National Bank of Chelsea in the amount of ;1,872.50 with his loan
secured by pledge of savings pass book. It is also noted that
Mr. Crane is indebted to The First New Haven National Bank, New
Haven, Connecticut, in the amount ofZOO with his loan secured by
15 shares of stock of Eastman Kodak and co-signature. Accordingly,
the Board's approval of the appointments of Mr. O'Connor and
Mr. Crane is given with the understanding that neither will participate in any examination of that bank to which he is indebted
until such indebtedness has been liquidated.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
BOARD OF GOVERNORS
OF THE
Item No. 10
3/2/62
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
March 50 1962
CONFIDENTIAL (FR)
Mr. H. E. Hemmings, First Vice President,
Federal Reserve Bank of San Francisco,
San Francisco 20, California.
Dear Mr. Hemmings:
In accordance with the request contained in your letter
of February 27, 1962, the Board approves the appointment of
Wayne C. Hall as an assistant examiner for the Federal Reserve
Bank of San Francisco. Please advise as to the effective date of
the appointment.
It is noted that Mr. Hall is indebted to the Bank of
America, NT&SA, San Francisco, in the amount of 536 which loan
in an original amount of $4,020 was used for the purpose of purchasing a mobile home. Accordingly, the Board's approval of the
appointment of Mr. Hall is given with the understanding that he
will not participate in any examination of that bank until his
indebtedness has been liquidated.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
@FedFRASER