The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
708 A meeting of the Board of Governors of the Federal Reserve 8Yetea was held in Washington on Wednesday, May 31, 1939, at 11:30 a. Da. PRESENT: Mr. Mr. Mr. Mr. Mr. Eccles, Chairman Ransom, Vice Chairman McKee Davis Draper Bethea, Assistant Secretary Mr. Carpenter, Assistant Secretary Mr. Clayton, Assistant to the Chairman The action stated with respect to each of the matters hereinafter referred to was taken by the Board: The minutes of the meeting of the Board of Governors of the Pede — rua. Reserve System held on May 29, 1939, were approved unanimously. Memorandum dated May 26, 1939, from Mr. Spurney, Building Meta er, recommending, with the concurrence of Mr. Noell, Assistant Seer .4. e'arY, that, for the reason stated in the memorandum, Lafayette 1148111./Igt°n, porter, be granted an advance of sick leave of not to exceed sixty days from May 31, 1939. Approved unanimously. Letter to the board of directors of the "First State Bank of St 'I'etern, St. Peter, Illinois, stating that, subject to conditions or 1111341bershiP numbered 1 to 3 contained in the Board's Regulation H alld the f0 ..lowing special condition, the. Board approves the bank's 4411eati°n for membership in the Federal Reserve System and for the 441"°Priate amount of stock in the Federal Reserve Bank of St. Louis: . 709 5/31/39 -2- "4. Such bank shall make adequate provision for depreciation in its banking house and furniture and fixtures." Approved unanimously for transmission through the Federal Reserve Bank of St. Louis. Letter to Mr. John Edgar Hoover, Director, Federal Bureau of Investigation, United States Department of Tustice, reading as follows: "A copy of your letter of May 25 advising that the Federal Bureau of Investigation is in receipt of information from a confidential source indicating that the Manufacturers and Traders Trust Company, Buffalo, New Y"k) has used :14,000,000.00 in reserves for purposes Other than the payment of dividends has been forwarded to Mr. Gidney, Vice President in charge of the Bank Examination Departaent of the Federal Reserve Bank of New Y°r1c) for consideration in connection with the examination of the trust company. The Federal Reserve Bank of .! l ew York has been requested to keep your agent in New lorx advised as to any developments in the situation referred to in your letter." Approved unanimously. Letter to Mr. Harrison, Chairman of the Conference of Presidents, Isaading as follows: "Receipt is acknowledged of your letter of May 26, 1939) advising that you have called a conference of audibors to be held in Washington on October 16, 1939, and that any topics to be considered at the conference are uo be submitted to Mr. F. V. Grayson at the Federal Reserve Bank of Cleveland. It appears probable that the Board will wish certain matters to be placed upon the agenda of the conference and in accordance with your suggestion such topics when decided upon will be transmitted to Mr. Grayson." Approved unanimously. Letter to Mr. Parker, President of the Federal Reserve Bank 710 5/31/39 -3- or Atlanta, reading as follows: "There is enclosed a copy of a letter from Mr. Frank I. Harle, president of Cleveland National Bank, Cleveland, Tennessee, dated May 5, 1939, which was addressed to the Comptroller of the Currency and referred to the Board of Governors for reply. There is also enclosed a copy of our letter of today's date to Mr. Harle, advising him that we have written your Bank regarding the matter. "Mr. Harle's inquiry relates to the Clayton Act status of three directors of his bank after August 1, 1939. However, the expiration of this time limit would have no bearing upon the matter unless the directors were lawfully serving on the date of the enactment of the Banking Act of 1935. Mr. Harle is serving the Cleveland National Bank and the Cleveland Bank and Trust Company, and states that he has a permit. However, although the Board's files show that a permit has been issued to him, it does not cover these particular relationships, and 81nee the available information indicates that the banks are engaged in some of the same classes of business (including issuing certificates of deposit and making real estate loans) the question whether Mr. Harle may continue to serve the two institutions apparently depends upon whether one of the other exceptions is applicable. If such is the case, he could continue to serve irrespective Of the August 1, 1939 limitation. However, the Board does not have sufficient information to show whether any of the other exceptions is applicable. "Mr. Harle says that a majority of the stock of the tit:34-u company is held by stockholders of the national bank, ut that those who own the majority of the stock of the trast company do not own a majority of the stock in the national bank. Probably Mr. Harle is correct in assuming hat Paragraph numbered (4) in the statute is not applicable, uat it might be desirable for your Bank to verify the !'acts, since the exception would be applicable if the -Lasts of stockholders of the two institutions reveal that .1,inY group of persons, all of whom are stockholders in both -institutions, hold, together, a majority of the stock in 130th institutions. "The situation is virtually the same with respect to Mr. C. S. Mayfield. Apparently he did not receive a Clayton Act Permit. "Mr. S. K. Tohnston may continue to serve if he is serving only the Cleveland National Bank and the American ? 711 5/31/39 -4- "Bank and Trust Company, Chattanooga, because of the pro7iei3n5 of paragraph numbered (5) in the statute. "You may be interested in knowing that Senator Glass has introduced a bill (S. 2150) which would amend section 8 of the Clayton Act by substituting the date 'February 1, 1944' for the date 'February 1, 1939' now appearing in the statute. The bill has been referred to the Senate Committee on Banking and Currency but that Committee has not yet made its report. However, as indicated above, it seems doubtful whether the enactment of this bill would have any effect upon the relationships referred to by Mr. Harle. "It will be appreciated if your Bank will obtain the necessary information and advise Mr. Harle. It will also be appreciated if you will advise the Board of the disposition made of the matter." Approved unanimously. Thereupon the meeting adjourned. Assistant Secretary.
@FedFRASER