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Minutes for May 21, 1958 To: Members of the Board From: 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, if you 'were present at the meeting, please initial in colfl A below to indicate that you approve the minutes. If you were not present, please initial in column B below to indicate that you have seen the minutes. Chm. Martin Gov. Szymczak Gov. Vardaman Gov. Mills Gov. Robertson ), /14 Gov Balderston Gov. Shepardson cyc)'/S. Ka/14 Minutes of the Board of Governors of the Federal Reserve System On Wednesday, May 21, 1958. PRESENT: Mr. Mr. Mr. Mr. Mr. Mr. Mr. The Board met in Room 1202 at 9:15 a.m. Martin, Chairman Balderston, Vice Chairman Szymczak Vardaman Mills Robertson Shepardson Carpenter, Secretary Hackley, General Counsel O'Connell, Assistant General Counsel Hostrup, Assistant Director, Division of Examinations Mr. Thompson, Supervisory Review Exami ner, Division of Examinations Mr. Mr. Mr. Mr. The Board heard oral arguments in the matter of the applications Of First New York Corporation, The First National City Bank of New York, and International Banking Corporation for prior approval of action to become bank holding companies under section Act. 3 of the Bank Holding Company A transcript of the proceedings has been placed in the official leeord of this case. ' The meeting then adjourned. Secretary's Notes: Pursuant to the decision reached by the Board on May 8, 1958, with regard to the question which had been raised concerning the disposition of currency collections at Federal Reserve Banks, the letter of which a copy is attached as Item No. 1 was sent today to the Chairman of the Conference of Presidents of the Federal Reserve Banks with the approval of Governor Shepardson. 5/21/58 -2Governor Shepardson approved on behalf of the Board on May 200 1958, letters to the Federal Reserve Banks of Cleveland and Richmond (attached Items 2 and 3) approving the appointment of Jerry L. McMaken as assistant examiner and the designation of Duncan M. Bevan as special assistant examiner at the respective Banks. Pursuant to the recommendation contained in a memorandum dated May 16, 1958, from Mr. Masters, Director, Division of Examinations, Governor Shepardson also approved on behalf of the Board on May 20, 1958, the appointment of John E. P. Carney as Assistant Federal Reserve Examiner in that Division, with basic annual salary at the rate of $4,4850 effective the date he assumes his duties. BOARD OF GOVERNORS Item No. 1 5/21/58 OF THE FEDERAL RESERVE SYSTEM WASHINGTON 25, D. C. ADDRESS OFFICIAL CORRESPONDENCE TO THE BOARD May 21, 1958. Mr. Joseph A. Erickson, Chairman, Conference of Presidents of the Federal Reserve Banks, c/0 Federal Reserve Bank of Boston, Boston 6, Massachusetts. Dear Mr. Erickson: It will be recalled that when the Board met with the Presidents following their February Conference there was some ;,liseussion regarding the disposition of the accumulations at the ',1.eserve Banks (principally Chicago) of currency items which might n of value from a collector's standpoint; and that as a result °r the discussion it was understood that the Board would consider the matter. Prior to meeting with the Board, the Presidents had apProved the following recommendations: "(1) Until October 1, 1958, no bank dispose of duplicate or miscellaneous items except to another Federal Reserve Bank. During the intervening period, any bank which is seeking items to round out its displays will make its wants known to, and endeavor to secure the desired items from other banks. "(2) Beginning October 1, 1958, the banks will be free to dispose of miscellaneous and duplicate items in accordance with procedures to be fixed by a committee appointed by the Board of Governors. The Committee suggested that the committee include, among others, Board staff members from the Division of Bank Operations and from the Legal Division, and expressed the view that consultation with the Treasury Departlaent on the legal aspects of disposing of currency items may prove desirable." Mr. Farrell, Assistant Director of the Division of Bank °Aerations, and Mr. Hexter, Assistant General Counsel, discussed Mr. Heffelfinger, Fiscal Assistant Secretary of the Treasury, t24 Mr. Howell, Deputy Treasurer, various steps that might be taken _v dispose of the currency items in question. The Treasury repreentatives took the position that (a) there is no objection to the Mr. Joseph A. Erickson -2- Practice by the Federal Reserve Banks of holding certain special currency items for exhibit purposes, but that (b) all other pieces of uncurrent money being neld by the Reserve Banks should be turned in to the Treasury for redemption. The Board concurs in the view that uncurrent money that is not being used by the Reserve Banks for display purposes should be forwarded to the Treasury for redemption. However, it sees no objection to the recommendation of the Presidents' Conference that the Present accumulations be held until October I, 7_9580 in order to Permit the Reserve Banks having gaps in their displays to inform :41ther banks of their needs and to obtain from these banks any such eeded items as may be available to complete their respective exhibits. 1 In dicculsing this matter Mr. Heffelfinger mentioned the P°ssible historical value of the uncurrent items, and, accordingly, ,XPressed the desire that the accumulations in question be forwarded I so the Treasury in uncancelled whole-note form, including any "new , eries" Treasury currency which the Reserve Banks might otherwise estroy themselves. Mr. Heffelfinger indicated that the Treasury l!ould issue instructions concerning the procedures to be followed ln this regard. It maybe of interest to mention that there is pending in Congress a bill (H.R. 9449) which, in order to provide a hiscal collection of the currency issues of the United States, 1:/ould authorize the Treasury to withhold from cancellation and rstruction one piece of each design, issue, or series of each "nomination of each kind of paper currency. Very truly yours, (Signed) S. R. Carpenter S. R. Carpenter, Secretary. BOARD OF GOVERNORS ate%q:',1•4. •v, •A, - - V OF THE Item No. 2 5/21/58 FEDERAL RESERVE SYSTEM WASHINGTON 25. D. C. 1'44 AOORESS OrriciAL coRwEspoNocNct TO THE BOARD -6'4404 May 201 1958 Mr. Paul C. Stetzelberger, Vice President, Federal Reserve Bank of Cleveland, Cleveland 1, Ohio. Dear Mr. Stetzelberger: In accordance with the request contained in your letter of May 16, 1958, the Board approves the appointment or Jerry L. McMaken as an assistant examiner for the Federal Reserve Pank of Cleveland. Please advise as to the date upon which the appointment is made effective. Very truly yours, (Signed) S. R. Carpenter S. R. Carpenter, Secretary. BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM Item No. 3 5/21/58 WASHINGTON 25. D. C. AODRESS OFFICIAL CORRESPONDENCE TO THE BOARD May 20, 1958 Mr. N. L. Armistead, Vice President, Federal Reserve Bank of Richmond, Richmond 13, Virginia. Dear Mr. Armistead: your In accordance with the request contained in ation design letter of May 15, 1958, the Board approves the Of Duncan M. Bevan as a special assistant examiner for the Federal Reserve Bank of Richmond to participate in the examof State member banks only, except The Bank of Virginia, Richmond, Virginia. Very truly yours, (Signed) S. R. Carpenter S. R. Carpenter, Secretary.
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