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*IS Minutes of actions taken by the Board of Governors of the NleraiReserve System on Monday, May 26, 1952. liood. Room at 10:00 a .r11. PREBENT: Mr. Mr. Mr. Mr. Mr. Mr. The Board met in the Martin, Chairman Szymczak Evans Powell Mills Robertson Mr. Carpenter, Secretary Mr. Kenyon, Assistant Secretary Governor Szymczak reported that in accordance with action taken 11' the BOarcl on May 8, 1952, a memorandum submitted by Governors Powell alldiAtiba under date of April 29, 1952, concerning policy and procedure Vith reei)ect to investment of funds of the Retirement System of the Fed4 '1 Reaerve Banks was submitted to Counsel for the Retirement System, date of may 20, 1952, Mr. John V. Duncan, of Counsel, submitted 4114 1114 Et. letter in Which he expressed the opinion that the report "is sound and that there is adequate legal basis for the committee's conclusions and tee° eliclations.„ G°17ern0r Szymczak recommended that in the circumstances the Board 441.°11e t n he -c)nelusions and recommendations contained in the report and tbat pr esidellt Williams, Chairman of the Executive Committee of the Retire''resident Earhart, Chairman of the Board of Trustees of the krepie—, SYstem, President Young, Chairman of the Investment Committee th Reti 'renlent System, and President Leach, Chairman of the Conference 5/26/52 -2- O Reserve Bank Presidents, consider what, if any, steps should be taken to comrey to members of the Retirement System the conclusion contained in the re port that the Board of Governors and the Federal Reserve Banks are 11°.t j11,5- bound to make good any substantial deficits that might occur ill the reserves of the Retirement System. Governor Szymczak's recommendations were approved unanimously. Upon motion by Governor Powell, unanimous approval was given to the following recommendations contained in a memorandum dated May 23, 1952, from Mr. Bethea, Director, Division of Administrative Services: ealthol. That the Division of Administrative Services be rized to hold an air raid drill in the Federal Reserve on June 12, 1952, at 9:30 a.m. qon 2. That the Division be authorized to show three films tionTed and loaned by the Federal Civil Defense Administra4:30 n the Board's cafeteria on June 6, 1(y)2, at 3:4) and P.m. Diate13., That the Division be authorized to spend approxieit 60G to cover the cost of necessary equipment and def;'ee ordered and to be ordered to complete the civil 6 .e Program at the Board for which no provision was tetc1 : the 952 budget of the Division. 1 111.,,Iv 4y 7, G°11ertlor Mills referred to a memorandum submitted to the Board by ici Assistant Director, Division of Bank Operations, under date of 1952' ,,retiot thEtt it regarding Federal Reserve Bank plans for continuing essential 14 the event of an enemy attack or similar emergency, and stated al3Peared from the memorandum and the attached summary of reports t)r- 5/26/52 -3*(44 the D -,Leserve Banks that arrangements of some of the Banks for the of vital records and the establishment of security files were tlIth f ttfther advanced than those of other Reserve Banks. LIG a brief discussion, Governor Evans suggested that within ee8°118'ble time, perhaps six weeks, the Division of Bank Operations review the 8 at the various Reserve Banks and make a further report to the Board,. This suggestion was approved unanimously. At this point Mr. Allen, Director, Division of Personnel Administra- tic); joined the meeting. Con sideration was given to the request contained in a letter dated 1411Y 16, 1952, from Mr. 11411k"Xszsas KoloPang' First Vice President of the Federal Reserve City, that the Board approve additional expenditures by that .141k Illthe amount of approximately $3,575 a year on account of rate increases 41 cotnection with the group surgical and hospitalization contracts covering /111/1.01ees of the Bank. In be response to a question by Governor Powell as to whether it might advantageous for the Reserve Banks to shift from participation in group 614"ticel. and hospitalization contracts to coverage under contracts with 111811:knes comDani es, mr. Allen said that a committee consisting of four 1(16 -qtrIre Bank personnel directors which had studied the matter recently CY 5/26/52 -4- concluded that the benefits available under the group surgical and h°8111talization contracts appeared to be greater than would be available theri ' llee at the same cost. He added, however, that the additional bene- rItelaltident to the increased cost of the plan in effect in Kansas City vere 113ts ubstantial, the increase refleeting principally the general tendency t hroughout the country toward higher charges for the services Involved. Be recalled that the Board had approved additional expenditures bY several of the other Reserve Banks to cover rate increases in the group cottrects. Thereupon, unanimous approval was given to a letter to Mr. Koppang reading as follows: lett "In accordance with the request contained in your the : 6 °f May 16, 1952, the Board of Governors approves it aqditional expenditure of approximately $3,575 a year tie_lection with the hospital and surgical program as icribed in your letter." liecielell'nerence was made to proposed salaries of officers of the Federal 8114 of Richmond and Atlanta for the year beginning June 1, 1952, : vhich l*e the etibjeet of memoranda submitted by the Division of Personnel illietrl" a 4 ---40n to the Board under date of May 20, 1952. At the requet of the Board, Mr. Allen commented on the salaries 'Droposel. 11°1" officers Is); tade 4r4 of the Richmond Bank, stating that all of the increases Within the provisions of the Board's letter of February 26, the salary stabilization regulations, and that he would recommend Of 4-1_ "Ile salaries as submitted. 5/26/52 Thereupon, unanimous approval was given to a letter to Mr. Woodward, Deputy Chairman, Federal Reserve .13.nk of Richmond, reading as follows: "The Board of Governors approves the payment of salies to the following officers of the Federal Reserve ln of Richmond and its Branches for the period June 1, a.;:k=, through May 31, 1953, at the rates indicated, which e the rates fixed by the Board of Directors as reported Your letter of May 8, 1952. Name Annual Salary Title : 4_rugh -177 each — t rri')0C President v. S. Walden, Jr. 18,000 First Vice Pres. &lard A. Wayne President 17,000 Vice lloger W. Mercer Vice President 13,500 Cashier Clair B. Strathy Vice President 13,500 Secretary X. 10.a'. 13,500 antley Watson Vice President ,11i1E3. W. Williams 13,000 Vice President : Ithaniel L. Armistead Vice President 13,000 ' 4/ten S. Martin Assistant Vice 9,600 President Edw. Waller, 8,700 Assistant Cashier Jr. ., 768e13/1 M. Nowlan 9,500 Assistant Cashier Ti9rthe B. Wakeham 8,5oo Assistant Cashier es W. Dodd, Jr. 9,coo Cashier Assistant A°11n L. Nosker 9,000 Cashier Assistant '"„a/l)reY N. Heflin 12,000 Counsel G, Rarold Snead 9,000 Chief Examiner Baltimore Branch 13,500 &.111.d, P. Hagner Vice President ; -'°,1...gh C. Wienert 8,200 Assistant Cashier 7,800 Assistant Cashier ' 11. P. Armstrong ' *A1 1 11.18 7,600 "4-trad A. Stewart, jr. Assistant Cashier Charlotte Branch Il°bert L. CherrY 13,500 Vice President l,zihope A. Ligon 10,000 Cashier 8,100 AsGistant Cashier I't L. Boneycutt Cashier 7,600 Assistant 4T:'inton Mondy with of Board Directors the re 11 view of the action taken by ter'reet to --,. tur,, R. S. Brock, Jr., as indicated in Mr. Leach's letvis.Y 23, the Board of Governors approves the payment of r r n el 5/26/52 -6ft saaa 17 to him as General Auditor, for the period May 8, 1952, ,Ch May 31, 1953, at the rate of $10,500 per annum, which i:I.T1 - tale rate also fixed by the Board of Directors." With respect to the increases proposed for officers of the Atlanta )*. Allen (it the stated that the salaries of Vice President Paris, in charge Icev Orleans Branch, Assistant Manager Shaw, of the same branch, and leist t al"lanager Frazer, of the Birmingham Branch, already were in excess the —4111111fle established for their positions and accordingly the increases Atoposed the Bank for these officers would not be in accordance with ex- istite ware of Stabilization regulations. He said that the Reserve Bank was this fact and had included the recommendations at this time merely to ito.e `u. ate a desire to make the adjustments whenever it became possible. t'ettiaert be recommended that the other salaries proposed by the Reserve Bank 41/Pro ea V-- as slihmitted. Thereupon, unanimous approval was given to a letter to Mr. Patterson, Secretary, Federal Reserve Bank of Atlanta, reading as follows: .Ile Board of Governors approves the payment of salarte "T Of Al 'ic) the following officers of the Federal Reserve Bank thrl",:t4t8. and its Branches for the period June 1, 1952, , re4;':'MAY 31, 1953, at the rates indicated, which are the lett ;"-zed by the Board of Directors as reported in your °r MAY 12, 1952. lc, !tilt Annual Salary Title $ 25,000 President 7 .1c°1m Bryan President 18,000 Vice First Clark IL. Bowman 13,500 President Vice J. E. 11,500 President Vice Denmark 5/26/52 -7It Annual Salary NameTitle Harold T. Patterson Vice President and $14,000 General Counsel L. B. RaistyVice President 11,100 Earle L. Rauber Vice President and 11,600 Director of Research S. P. Schuessler 11,500 Vice President L. C. Rainey 81)00 Cashier 9,50C J. H. Bowden Assistant Vice President C. R. Camp 8,500 Assistant Vice President P. H. 8,000 Assistant Vice President Martin 7,500 Is as Martin Assistant Vice President J. E. 7,750 Assistant Vice President McCorvey 7,750 R. E. Milling Assistant Vice President Chas. 9,000 Assistant Vice President T. Taylor Fred Breck 6,500 Assistant Cashier R. M. Stephenson8,500 Chief Examiner ' .;,)°11dell Brown, Jr. 6,50o Counsel Assistant Cosel DeWitt Adams 8l000 General Auditor Birmingham Branch !.. L. T. Beavers 10,000* Vice President :',. J. Urquhart 7,500 Cashier 6,500 4vielvin Mcilwain Assistant Cashier Jacksonville Branch . A. LanfordVice President 13,500 44 C. Clark Assistant Manager 9)500 J. W. Snyder 8,500 Cashier C. MELSOn Ford7,5 00 Assistant Cashier Nashville Branch , R. 1B. .0 9,500 Moody) Jr. Vice President 7., R. Harrison9, 000 Assistant Manager 4, 1.1. 8,000 Cashier Starr Stilart, 5,700 H. Magee Assistant Cashier New Orleans Branch 80000 Cashier 11 ,1. !. Sewell -, 1. Chapman6,50 0 Assistant Cashier ,rn* Approved through June 30, 1952. etry t 4he Board of Governors also approves the payment of Bal°1 14!%. John L. Liles, Jr., Vice President, for the period ks . Etta:11)111-P 1952, through June 30, 1952, at the rate of $9,000 per flt tl,' and for the period July 1, 1952, through May 31, 1953, the ? rate of $9,500 per annum, which are the rates fixed by .°0ard of Directors as indicated in your letter. 914) 5/26/52 -8"The salaries for Mr. Frazer, at the Birmingham Branch, a for Messrs. Paris and Shaw, at the New Orleans Branch, ;1.6 already above the maximums for the positions they occupy, 14,341., a ccordingly, the increases proposed in your letter of 12,would carry them further beyond these maximums and _ouza not be in accordance with the regulations of the EalZpr St abilization Board. As indicated in the Board's letter or , PebruarY 261 the Board is not prepared to approve such inat this time. However, the Board approves the payment sa ilarY to Mr. H. C. Frazer, as Assistant Manager at the B.V*11111 Branch, at the rate of $9,000 per annum, to Mr. Parie, as Vice President in charge of the New Orleans Bre.„1, ' siitt ea, at the rate of $15,000 per annum, and to Mr. M. L. raj/ as Assistant Manager at the New Orleans Branch at the 11* $9,500 per annum, for the period June 1, 1952, through liazrel° 1953, if these salaries are fixed by your Board of "L'ors at such rates." n There Naw ensued a general discussion of the policy that should be istl eci. /7 the Board with respect to approval of officers' salaries at era ' Reserve Banks and also as to whether the Board should submit to the s 8'14117 Stabilization Board for consideration increases proposed t°11 the ' - -ee Atlanta Bank officers mentioned above and for officers of thec :clf the other Reserve Banks which had been disapproved because aliened the existing regulations. etereezeltl i' There appeared to be general tict 7that the long-r e policy of the Board should be in the direcOf elTrov ing imum salaries for the various official positions at lief3erve Banks except the president and first vice president, and that the, AOse1,.7 e Bank directors should be permitted thereafter to adjust salEtries these ranges at their discretion. It was suggested, however, that the 1/11eParation of such salary schedules by the Reserve Banks and (tg'i 512%2 thetr ccmeideration by the Board might involve some time and that in the Cireum steuxec it might be well to consider taking up with the Salary orfice zatian Board immediately certain of the adjustments for individual 1.8 Which had been proposed by the Reserve Banks and disapproved. to 01)4don was expressed that if such proposed adjustments were submitted '"LarY Stabilization Board it would be well as a matter of equity Latorm all of the Reserve Banks of the procedure which was to be followed Q." - Ice it appeared that certain of the Banks had adhered strictly to uue *Q°41'd's letter of February 26, 1952, and had refrained from sub4h 114; '"Vosed increases which could not be approved under the provisions LO "thet letter. In course of the discussion Governor Evans stated that he was ! l tic1111119-Y concerned with improving the level of salaries of junior °Ulcers at the Reserve Banks. "Ileserve Batk He also expressed the opinion that salaries employees should be adjusted to fall within the fourth Illalter of c onmunity wage brackets rather than within the third quarter Cke t 48 at present. Glpverner Robertson then proposed: (1) that the Board continue for tize be, to adhere to the provisions of its letter to the Reserve 11444 "Pebrtla— AJ 26, 1952; (2) that a letter be sent to all of the Banks Rtetti_ that the Board was prepared to take up with the Salary Stabilization 110 ra DroDoR ---a-L8 for increases of salaries of Reserve Bank officials where 5/26/52 -10ilecesaarY to correct inequities, and requesting the Banic.s to submit cv.ses Ct thet nature which they wished to have considered; (3) that on receipt Ilqaies from all of the Reserve Banks, the Board consider the cases 81141itted bY the Banks and take up with the Salary Stabilization Board the 448'41i-eh in the opinion of the Board should be approved; and (4) that the letter to the Reserve Banks make it clear that the submission of the 14(141(1118.1 oases represented merely an interim step and that the Board NA proceed with its study of an over-all salary plan for officers of the Pederal Reserve Banks. The procedure suggested by Governor Robertson was approved unanimously. or At the meeting of the Board on May 22, 1952, there was discussion A_ ' 441tft of Of letter to President Erickson, of the Federal Reserve Bank of relative to proposals by that Bank as to means by which greater 1440tection mitibt be afforded to currency and coin shipments within the ciletrict axd the volume of shipments to and from the Reserve Bank might be rehee° The draft was referred to Governors Powell and Mills for recomto the Board, and the following revised draft of letter had been 4% -ea and copies Bent to the other members of the Board prior to this 114t:418: lAfit:Tour letter of April 21 regarding your review fol- the Danvers larceny of means of increasing the 5/26/52 -11- "Protection of currency both within the Reserve Bank and : : 111 111g shipment, and also means of reducing exposure to 4sk of loss, has been read with much interest. "It is unfortunate that the Federal Bureau of Investit ga htiM is so busy as to be unable to advise with you at tba is time on security measures. It is noted, however, f euB tuje. a0 expects to be able to assist you sometime irj t the th ou„"As one means of reducing the volume of shipments of between. the Federal Reserve Bank and member banks, ; (11 11 Would reduce the expense of the Reserve Bank in hanthai'llg currency as well as the exposure to risk, you suggest lept i the Board consider a recommendation to Congress for voQ milation at the earliest feasible opportunity which -4-. "Permit vault cash to be counted as reserves. "The Board favors such a change at the appropriate thr• It does not believe that it would be appropriate at res :tirael however, to open up the subject of changes in 'I'Ve requirements with this one proposal. am "Another means of reducing the volume of shipments to 1104-teropa the Federal Reserve Bank referred to in your letter ourrci *be the reduction in the amount of cross-hauling of Which could be accomplished if banks could be in, er diacea thr„:_ 0 exchange currency with each other without going e 1 the Federal Reserve Bank. Such a program, you state, iti 7 e clY Partially in effect in two or three areas in ie ,' Yourif : strict, but you point out an obstacle to such arrangenieritn' s the obligation of the Reserve Bank to remove unfit 118.yi8 froin circulation. You suggest that, if in addition to h the costs of shipping currency from one member bank to arig batk-s3ther in the same area the Reserve Bank paid to member ket.t8 the cost of sorting out unfit notes, the volume of shipred. a t° and from the Federal Reserve Bank would be materially 'Aced, "The report ecramittee on Free Services recommended in its that ' 3f February 25, 1946, to the Presidents' Conference larte,,,each Reserve Bank continue to urge member banks to make changes of currency and. coin. The operating circulars , C/r Etcorita.Valber of Federal Reserve Banks, including your own, &Itch ,1.1 a Provision requesting the cooperation of banks in that 4.1terchanges of currency and coin. It seems evident to otActich interchanges would reduce the number of shipments from altheBank and thus not only reduce shipping e Reserve Ba but reduce the expense of handling currency within the ''eserve Bank. 5/26/52 -12"The possibility of paying member banks for sorting Unfit currency is a new approach. This proposal, as a8 the extent to which the Reserve Banks should absorb • , eioste of shipment of currency and coin between member banks pna the conditions under which that should be done, involves ssYEteT policies and practices. 'It is suggested, therefore, that both matters be placed 'a the agenda for discussion at the forthcoming Conference or Presidents." • The revised draft was approved unanimously. Chairman Martin referred to a draft of memorandum which Mr. Allen hetl, tivi Isli7estedbe sent to the head of each division by the Director of the 11 °f Personnel Administration requesting that appropriate steps be Withi —n the respective divisions to correct any laxity with regard to °136erve2Ice of the regular working hours. It tilt the response to a question by Governor Szymczak, Mr. Allen said matter had been discussed with the Committee of Employees and thlteorittlitt ee favored the contemplated procedure. He also commented on Nato]Is If* he deemed it desirable to ask the division heads to review the tiatter at this time. While ths members of the Board agreed that any necessary steps 11°11.1c1 be taken to insure a reasonable degree of compliance, it was felt so that Ile l employees voluntarily Nke,?oteci a atitude was desirable in those cases where A_ °011siderable amount of overtime on special assignments without '5411)er438,t ar, It was suggested, therefore, that before any action was t 6tkell by he Board, the matter be discussed at a meeting of the senior tELrt. 5/26/52 -13This suggestion was approved menimously. Mr. Allen then withdrew from the meeting. Before this meeting there had been circulated to the members of the 13 a draft of letter to the Presidents of all Federal Reserve Banks egazdi 4g reductions of capital in cases where a State member bank was at the "ale time issuing preferred stock or capital notes or debentures. Certain revisions in the draft had been proposed by Governor Powell and circulated to the other members of the Board prior to this meeting, and the letter was approved unanimously in the revised form, as follows: 2, "As You know, standard condition of membership number 134-8. set forth in the Board's Regulation H, requires the rclis consent to the reduction of capital by State member belak revi :slibject to such condition. The Board is presently to r;ralg. its policy in granting or withholding its consent -evi,tlactions of capital in cases in which the member bank time issuing preferred stock or capital notes Or d'al4L= borr "Notes and debentures, of course, normally represent 1,30°Iied money. During the banking emergency of the early amaci 8 there were no adequate sources for new common stock Ellili ill most. States preferred stock could not be sold except 4pAct to the same double liability as was then generally : r ; eble to common stock. Accordingly, tanks were allowed to llote?"Lerlish their capital funds by the issuance of capital and debentures sold to the RFC; and, by a statute ' el:tact 10,0 uecl ta 1934, notes and debentures so purchased by the e, re Permitted to be considered capital for purposes of elig;1, 4 : lioNr 41tY for membership in the Federal Reserve System. have -r) all such notes and debentures purchased by the RFC Blantilic)w been retired or are in process of retirement. the:/ trill. all preferred stock sold by banks to the RFC in tor r;,,,,V-3r 1930's has now been retired or is being offered - e to other holders. ' Igf; 5/26/52 le. "Since conditions today are very different from those 4111.ch gave rise to the legislation referred to above, it 13 requested that for the time being in any case in which eState it member bank applying for approval of a reduction in 8 caPital pursuant to the condition of membership contem4;tate8 a program involving the issuance of preferred stock caPital notes or debentures, such application be sub,t,'"t_ted to the Board of Governors for its consideration. "'Board's and , lettersof December 15, 1934 (F.R.L.S.43451) -LI 1937 (F.R.L.S.#34-54), delegating authority to. th terederal Reserve Banks in approving reductions of capi/ are modified accordingly." At this point Mr. Vest, General Counsel, joined the meeting. Reference was made to a memorandum addressed to Chairman Martin 1"1"eSt under date of May 23, 1952, regarding a letter dated May 12, 1952, frmaSenator Lyndon Johnson, Chairman of the Committee on Interstate 844 l'°reiga Commerce, which stated that the Committee would be pleased to r"ei've c ents the Board might care to offer with regard to H.R. 5767). a bill to amend the Federal Trade Commission Act with respect to 4rtait CO ttracts and agreements which establish minimum or stipulated resale 1)rice5 and which are extended by State law to persons who are not Doties to such contracts and agreements. Mr. Vest's memorandum suggested 'cl might make a report expressing its views in whatever way :: the 13°611 11 ‘kesired, that it might e Senator Johnson that it had no comments °r that it might make no response to the letter. Following a discussion by Mr. Vest of the purposes of the proposed legislation, it was agreed unanimously that inasmuch as it did not concern a matter of direct interest to the 5/26/52 -15Board, no reply need be made at this time, and that if a further request were received, it should 'be stated in reply that the Board had no comments to offer. Mr. Vest reported receipt of a telephone call on May 23, 1952, raezber of the staff of the House Judiciary Committee who inquired colterril 'le the nuMber of cases of bank mergers and consolidations approved bY the 8°ard under the provisions of Section 18(c) of the Federal Deposit Tzleur ell "Act and indicated that the Committee was considering the draftlegislation to restrict bank mergers and consolidations as a matter or lt-"policy. /le vota Mx. Vest went on to say that the staff member stated d Probably call again if such legislation were drafted. At this Point all of the members of the staff with the exception lileesre Carpenter and Kenyon withdrew, and the action stated with e 'Pect t ° eech of the matters hereinafter referred to was taken by the 11°Etra. of actions taken by the Board of Governors of the Federal 8Yetem on may or t , 23 1952, were approved unanimously. Lett r to Mr. Stevens, Federal Reserve Agent, Federal Reserve Bank Tork , reading as follows: 260 accordance with the telephone request of My °111 Mr. Small, the Board of Governors approves the # Paytle; Assisi' °I' salary to Mr. Richard E. Hunke„ Alternate t Federal Reserve Agent, at the rate of $7,000 5/26/52 -16-; "Per annura„ effective May 29, 1952." Approved unanimously. Letter to Mr. Peterson, Vice President, Federal Reserve Bank of St. to 1118) reading as follows: Your letter of May 15, 1952, transmitting the 1114iC;u'L, Of examination of the Chrisney State Bank, Chrisney, att ' arle) at close of business March 25, 1952, you called irieelition to the fact that the bank is now operating an auuralles department and is exercising a charter, or i.14017, power that was dormant at the time of the bank's all; 8ion to membership in the System. You stated that in 7 11 pe. , 4, c)r the small volume of business transacted by the deent and the approval obtained from the Supervisor of eer ie') Indiana Department of Financial Institutions, no the .ckYtle question was raised by your examiner concerning Y6 decision to commence exercising a heretofore art dorz:,, that7",„ Charter power. Accordingly, you have recommended tion he Board interpose no objection to the bank's opera-sc3r this small insurance department under condition of lzem1) -rethiP numbered one relating to broadening in functions. #351 ,11111 the Board's letter 7-9780 of January 6, 1937 (F.R.L.S. ; 11 it Vas stated that, in the absence of any abuse or unsour -,..,Prectices in the transaction of such business by a bank, 4ire,;4Z en" ition of membership prohibiting a bank from acting or indirectly as agents or brokers in the sale of Krattce would be prescribed. ti0n. t "1-11 the circumstances the Board will interpose no objecber ° the operation of an insurance department by the menIt is assumed, of course, that any such business stet ' e conducted in accordance with the applicable proviautho sro tf tiS et s te law and the rulingsof the appropriate State ea ,r Approved unanimously. tette -r for the signature of the Chairman to the Honorable Preston 1))._ ,041.0 044111e ectaPtro.aer of the Currency, Treasury Department, Washington, D. C., "1'1°11014s• , 5/26/52 -17In accordance with the informal arrangement existbetween your organization and ours with respect to , 111.e interchange of information relative to applications establish branches, representatives of your office re notified us of the pending application of the First :Iona' Bank of Arizona, Phoenix, Phoenix, Arizona, to tab, ) ,-ish a branch in Glendale, Arizona. s Neither this Board nor the Federal Reserve Bank of f.:114.Prancisco is in possession of any facts, other than he..c`'s v. presumably in your possession, which would seem to re. e a bearing on the need for such additional banking l, itiee, the ability of the applicant to provide such ranclil -4-1:ties on a sound basis, or the extent to which other bolp Det 78 Vould be adversely affected by the additional COM! t °r1 involved, or which for any other reason we believe be brought to your attention for consideration in -411-1 „8:tilm.t,, your decision on this application. hatal AS you know, matters of this kind are ordinarily . e 2- by telephone, but in this case we are responding l ec by: "er because the bank involved is related to Trans811.6'ce Corporation, which, as you know, has been made the of the Board's Order in proceedings instituted 1.1n4c , t, Et/icie- `sae Clayton Act. We appreciate that the authority tio,nresPonsibility for making a decision on branch applies.c'r national banks rests with your office; and this e v should not be regarded as indicating in any way ! le/42 or opinion of the Board of Governors as to the Eletio .ri which should be taken by you with respect to this - -cation.” Approved unanimously. t. Letter to Mr. Jerrold Walden, House Judiciary Committee, Washington, ree..34 'Ing as follows: ectry :?Ilresponse to the request made by you in your telephone 19,52 --aliton with Mr. Hackley of the Board's staff on May 16, to t there is enclosed a reprint of the Board's Findings as heete, Conclusion, and Order adopted on March 27, 1952, ;'etion with the Transamerica Clayton Act proceedings. -xhe Z-1511bli;allecript of the proceedings in this case is a ratter of - record and. is available for inspection at the Board's trip 5/26/52 Hoff, cr, Ices. -18- However, since the transcript is quite voluminous, -rtiPrleing some 11,000 pages, we have no extra copies of the t, ' allscript available. b "Section 12B(v)(4) of the Federal Reserve Act, as added J24t Of August 17, 1950, provided that the consent of the ' 1'roPriate bank supervisory agency should be obtained in : 4 ease in which an insured bank merges or consolidates with, it:tallmes the deposit liabilities of, another insured bank e,24e continuing bank will not have capital stock or surplus uda to the aggregate capital stock or aggregate surplus, susPectivel-, of the merging institutions. That section was Y orPerseded by similar provisions contained in section 18(e) the Pederal Deposit Insurance Act of September 21, 1950. cjeonsent of the Board of Governors is required where the i1/111-11g bank will be a State member bank; and, as requested byt ,there is enclosed a list of those cases in which the pre. ,T8 consent has been requested and obtained under these -Y1610116 of the law." g Approved unanimously. Letter to Mr. Gordon S. Chase, 1715 Millard Street, Bethlehem 111 reading as follows: 2, la,-ls refers to your letter to the President, dated May itianJ-)2: which has been referred to the Board of Governors, 48 irch as it relates to Regulation X--Real Estate Credit, Pertains to a new house you are endeavoring to sell. 844 "It the event that your new house is sold at a bona fide cotio„Pfiee of $12,500 with the purchaser availing himself of itg LT'_ixmal financing under Regulation Y, or a Federal Houevolonistration insured mortgage, the maximum loan value An 0,, as7be TJ ,W O, necessitating a down payment of $2,700, where, —"eran Purchasing the property at the same price with a Vetel 3116 Administration guaranteed mortgage would be required to 248 Vere"a down payment of only $1,375. However, if the house t1ola .:(31(1 for $11,0001 the required down payment under Regulaand FHA regulation would be $2,200, and to a veteran tit 041yigg a VA guaranteed mortgage the down payment would be thta T:ju°. Possibly you have had some misunderstanding in - :!Etrd, since the minimum down payment in all of these 2 1 1st 1, 1--'s is considerably less than the $4,000 figure mentioned J-11; pe.yraoeux letter. We hope this information concerning down-Ibl requirements under real estate credit restrictions of assistance to you in selling your house. 5/26/52 -19"We appreciate receiving your letter, especially since Y1ou Exe builder in the residential field. -Views of peras yourself and information relative to unsold using remaining on the market form an important part of Doard's continuing consideration and review of the efla,2's of Regulation Y in relation to developments in the --lonal economy as a whole." j Approved unanimously) with a copy to the Federal Reserve Bank of Philadelphia.
@FedFRASER