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A meeting of the Executive Committee of the Federal Reserve Board W48 held in the office of the Federal Reserve Board on Wednesday, Lay 6, 1931 at 11:40 a. m. PRESENT: PRESENT ALSO: Governor Meyer Er. Hamlin Mr. Miller Er. Tames Mr. McClelland, Assistant Secretary. Mr. Wyatt, General Counsel. The Assistant Secretary presented a telegram dated ray 6th from the Clicli an of the Federal Reserve Bank of Philadelphia advising that the b°41 'd of directors of that bank, at its meeting today, voted to establish rediscount rate of three per cent on all classes of paper of all maturities, erre ctive the first business day following that on which approved by the Federal lieserve Board. After discussion, upon motion, the rate of three per cent, established by the Philadelphia directors, was approved, effective tomorrow, ray 7, 1931. The Governor then reported that he had been advised over the telephone bY tile a -overnor of the Federal Reserve Bank of Boston that the board of diree tors of that bank today voted to establish a rediscount rate of two per Co lit On all classes of paper of all maturities, effective the first business ClEty r clil°171113' that on which approved by the Federal Reserve Board; also to .,ze the Executive Committee of the bank to reduce the rate to 1 1/2/0 hen auch a rate is made effective at the Federal Reserve Bank of Upon motion, the rate of two per cent, established by the Boston directors, was approved, effective tomorrow, ray 7, 1931. 5/6/3i -2The Governor also reported that in a telephone conversation with the 40varnor of the ..i'ederal _deserve Bank of Philadelphia this morning, he was advised that the bank has in contemplation a preliminary study on the erection °f a two or three story building on the site, adjacent to the present bank 1)1113-ding, acnuired in June 1930. He stated that he had requested Governor Iorrts to give the Board a detailed memorandum regarding the matter, and had adll.sed him that the Board would consider it at the meeting tomorrow. The Assistant Secretary then presented a telegram dated Lay 6th trE)ril Deputy Governor Kenzel of the Federal deserve Bank of New York, advistolIG that bill dealers today reduced their rates by 1/8 per cent on all and that the following schedule of buying rates on bankers' Ptancos has been made effective at the rew York bank. 1 to 50 days 31 to 90 days 91 to 120 days 121 to 1H0 days Repurchase 11/8% 1 1/4% 1 3/870 1 3/8!) Without objection, noted with approval. The Board then discussed with I. .;yatt a memorandum prepared by htzr, ' after discussion with 1.-r. Hamlin following the meeting on :_ay 4th, with 1\111her reference to the request of the Pennsylvania Company for Insurances elltiv°8 and Granting Annuities, Philadelphia, Pennsylvania, that the 3oard l'eQ°1181der its rulinz, of July 6, 19b0, that since its consolidation with the °°1°111E11 Trust Company of Philadelphia on Larch 29, 1930, the -,Jennsylvania Qt111'11Y has been sul)ject to the conditions of membership previously prescribed tor 4g "CePted by both of the consolidating banks, including one imposed on 140 (°1°Ilial Trust uompany that it should not acquire an interest in any other 114111 °r trust company through the purchase of stock in such other bank or 5/6/31 -3- trUst company, except after applying for and receiving the permission of the Pederal deserve Board. Counsel advised the Board that there is no question 14 his mind as to the correctness of the Board's ruling from a strictly legal "andpoint, but suggested that in view of the circumstances of the case, the 1°41'd rai2ht, as a matter of policy, modify the application of the condition °tZerabership relating to the purchase of stock in other banks, so as to Permit certain investments which the member bank has made since the consolida- tl°4 and certain others which it now has in conteLTlation. After a detailed discussion, the Governor suggested that it would be helpful to have an interchange of views between the member bank and the Board, and upon motion, he was authorized to extend to the Pennsylvania Company an invitation to have a representative meet with the Board for the purpose. 1,:r. Wyatt then left the meeting. The Assistant Secretary presented various reports and communications s'u were considered by the Committee and acted upon as follows: Matters noted with approval yesterday, on initials of members of the 4.eQ, "tive Committee, namely, telegrams dated May 5th from the Deputy Governor ' 40 Vederal Reserve Bank of New York, the Governor of the Federal Reserve Of Boston, the Chairman of the Federal Reserve Bank of Atlanta, the Of the Federal Reserve Bank of Chicago and the Secretary of the 4e ( ler ai Reserve Bank of Minneapolis, all advising of the extension of the 1)ttila rate of 1 1/4c4 to include maturities up to 90 days; a rate of 3/EY4V1, ge heretofore applied on bills maturing within from 46 to 90 days. Upon motion, the informal action of the Committee was ratified. Meraorandum dated May 4th from the Director of the Division of Re- 6/6/31 -4-and Statistics, submitting the resignation of Hiss Ruth L. 1,:artin, as a stenographer in the division, effective at the close of business July 7 '1931, and recommending that she be cgianted thirty days leave of absence Ilith Pay, prior to that date; the Director also reconudending the appointment "141r. V. Lon?;street as an assistant in the foreign section of the Division at8 salary of .2,400 per annum, effective June 1, 1951. Upon motion, the reconnuendations were approved. Report of Committee on Salaries and Expenditures on letter dated kaY 4th from the Deputy Governor of the Federal Reserve Bank of New York, b iitting list of employees for whom the directors of that bank authorized leA„ of absence with nay, on account of illness, during the month of April, hex% the total of such absences since January 1, 1931 has exceeded thirty (14Y8; the Board's Committee recommending approval of the salary payments . d Approved. Letter dated Lay 5th from the Comptroller of the Currency, recommend140p., gipProval of a salary of c'4,200 per annum for National Bank Examiner Harry “ 4/112 assigned to the Seventh Federal Reserve District. Approved. Telegram dated Hay 5th from the Omaha Clearing House Association, IlMendinc the appointment of Lr. J. 111. Harding of Omaha, as Class C biz,e "or of the Federal Reserve Bank of Kansas City, to succeed Hr. W. i. E') whose appointment as a member of the Federal Reserve Board for the 11411,4 Portion of the term ending January 24, 1933, was announced by the l'esident yesterday. Noted. 5/6/31 -5_ Memorandum dated April 29th from the General Counsel, submitting cl:rEq't of letter to the Governors of all Federal Reserve banks and to the 4eMbers of the Standing Committee on Collections on the subject of the duties and responsibilities of the Federal Reserve banks in "cashing" c)vellimient checks and warrants, which was submitted by the Board to the recent Conference of Governors and referred by that body to the Standing °°1 ittee on Collections for study and report, the proposed letter transnutting copies of Counsel's memorandum of April 17, 1931, with documents "tached, on the subject, as well as an opinion of the Attorney General of the United States, rendered Lay 27, 1925, pertaining to the liability of Pederal Reserve banks in connection with the redemption of certain war g . 8 stamps subsequently found to be counterfeit, copy of which has recent- beell rurnished the Board by the Treasury Department. Upon motion, the proposed letter was approved and ordered transmitted. Memorandum from Counsel dated April 28th with reference to the matter 04 Which action was deferred at the neeting of the Board on December 15, 1930, 114321e1Y1 ar rangements in effect at the branches of the Federal Reserve Bank O St. Lotus, whereby .federal Reserve notes are held in joint custody of the bralle4 and of an employee of the branch designated by the Federal Reserve 4ellt to represent him, which is contrary to the position taken by the Board 14 1.26 tilat the same person should not act as Assistant Federal Reserve Agent 1.11 the hazialing or custody of unissued Federal Reserve notes, and perform the rIllleti°11e of a clerk or employee of a Federal Reserve bank or branch, Counsel lug draft of a letter to the Federal Reserve Agent at St. Louis, his attention to the Board's previous ruling and suggesting that °IleiclerEttion be given to the establishment of a supply of unissued Federal 5/6/31 -6- ileserve notes at the branches of that bank under the triple control arrangetaelit which has been put in effect at other branches. The Assistant Secretary stated that the above matter was discussed Ivith Governor Martin of the St. Louis bank while he was in Washington ttendiag the Governors' Conference last week, and that Governor Martin tevted the St. Louis bank would be glad to change the arrangements at its bra,„ —cues to meet the views of the Board. Upon motion, the letter to the Federal Reserve agent was approved. -: %1 111.92J2111.2TNG CONMITIMS: 1)4ted, MaY 5th 1. 3ated, MaY 4th 1)4teci, MaY 5th I)Etted, 5th 144Y 5th Recommending 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. :lecoramendation approved. Recommending approval of the application of Mr. Charles H. Consolvo, for permission to serve at the same time as a director of the Virginia National Bank of Norfolk, Virginia, and as a director of the Union Trust Company of Maryland, Baltimore, 'faryland. Approved. Recommending approval of the application of Nr. Joseph H. Mans, for permission to serve at the same time as a director of the Columbia National Bank of Washington, D.C., and as a director and officer of the Bank of Commerce and Savings of Washington, D. C. Approved. Recommending apProval of the application of Mr. J. M. Olin, for permission to serve at the same time as a director of the First National Bank & Trust Company of Alton, Ill., as a director and officer of the Wood River National Bank of Wood River, Ill., and as a director of the First National Bank of St. Louis, iiissouri. Approved. Recommending approval of the application of Mr. C. A. Caldwell, for permission to serve at the same time as a director and officer of the First National Bank and Trust Company of Alton, Ill., and as a director and officer of The Wood River National Bank of Wood River, Ill. Approved. 5/6/31 -7- 1-12ZtLIILOF STANDIVG C01111112haS: (Continued) Dated, May 5th Dated, day 5th Dated, 1-lay 5th bat Iia' Gth Recommending approval of the application of ix. F. W. Olin, for permission to serve at the same time as a director of the First National Bank and Trust Company of Alton, Ill. and as a director of The Wood River National Bank of Wood River, Ill. Approved. Recommending approval of the application of Lir. George M. Levis, for permission to serve at the same time as a director and officer of the First National Bank & Trust Company of Alton, Ill., and as a director of the dood River National Bank of 'food River, Ill. Approved. Recommendinz. approval of the application of Lir. L. A. Schlafly, for permission to serve at the same time as a director and officer of the First National Bank & Trust Company of Alton, Ill., and as a director and officer of the kmd River National Bank of blood River, Ill. Approved. Recomending approval of the application of Mr. 1. B. Jacobs, for permission to serve at the same time as a director and officer of the First National Bank of Shreveport, La., and as a director and officer of the Algore National Bank of Kilgore, Texas. Approved. The meeting adjourned at 12:45 p. mL. Assistant Secretary tl ( uoutive CMctilittee) AUXILIARY MINUTES (May 6, 1931.) Report of Standing Committee dated May 5th, recommending action on an 411lioation for admission to monbership by the following state institution, allbiect to the conditions stated in the report attached to the application. Name Clinton Trust Company, New York, N. Y. Shares 600 F. R. Bank New York Assistant Secretary.
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