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1527 A meeting of the Board of Governors of the Federal Reserve SYstem was held in Washington on Friday, November 12, 1937, at 11:30 PRESENT: Mr. Eccles, Chairmen Szymczek Mr. Mr. Mr. Mr. Morrill, Secretary Bethea, Assistant Secretary Carpenter, Assistant Secretary Clayton, Assistant to the Chairman Consideration was given to each of the matters hereinafter teed 'O and the to action stated with respect thereto was taken by the tioard: Telegrams to Mr. Taylor, Secretary pro tern of the Federal Re41Te lattak of Cleveland, and Mr. Leach, President of the Federal Reof Richmond, stating that the Board approves the establishet wit bout change by the respective banks today of the rates of disCeititt and purchase in their existing schedules. Approved unanimously. M emorandum dated November 10, 1937, from Mr. Goldenweiser, eet "of thaq the Division of Research and Statistics, recommending etfective at the expiration of her temporary appointment on Novembar 19 '1937, and subject to her passing satisfactorily the usual physiOki ex animation Miss G. Elizabeth Ford be given a permanent appoint1464t a 8 €t clerk in the Division, with no change in her present salary at the 1. ate of 41,620 per annum. Approved unanimously. 1528 11/12/37 -2Memorandum dated November 10, 1937, from Mr. Goldenweiser, blrector of the Division of Research and Statistics, recommending that effective at the expiration of her temporary appointment on December 6 '19371 and subject to her passing satisfactorily the usual physical 6111ineti°n, Miss Muriel G. Webb be given a permanent appointment as a clerk ih the Division, with no change in her present salary at the Illte '1,440 per annum. Approved unanimously. Letter to Honorable J. F. T. O'Connor, Comptroller of the eillrelleY, reading as follows: "This refers to Mr. Prentiss' letter of September 18, inclosing a copy of a letter from the Hazleton Nanel Bank, Hazleton, Pennsylvania, presenting the question t whether a deposit of the Middle Coal Field Poor Dispolt "Y 1 be classified by a member bank as a savings deUnder the definition in section 1(e) of Regulation 193 tin "The Board of Governors has recently taken the posi-. zajthat a school district may be considered as an organic), I?n operated primarily for religious, philanthropic, wlr!-table, educational, fraternal or other similar purposes 4 pin the meaning of section 1(e) of Regulation Q and that "it of such a district may be classified as a savings dein2 dei:—it if it complies with the other requirements of the itelTAi°n. On the same basis, a poor district constitutof',„;7 seParate political subdivision the primary function " ',1 ich is the care and relief of the poor may be conphi red as an organization operated primarily for religious, h"nt ropic, charitable, educational, fraternal or other silig Purposes and, therefore, a deposit of such a dismeY properly be classified by a member bank as a oth4*Ils deposit provided the deposit complies with the er requirements of the definition." Approved unanimously. 1,529 11/12/37 -3- Letter to Honorable J. F. T. O'Connor, Comptroller of the elirrencY, reading as follows: "This refers to Mr. Gough's letter of September 20, 1937 whether deposits of the CongerPresenting the question Mutual Burial Association and the Conger Colored Mutual Benefit Association may be classified by member banks as savings deposits under the definition in section 1(e) Of Regulation q. "It is understood from Mr. Gough's letter that these WO a ssociations are operated by local undertakers under f t e nlutua1 burial insurance laws of Louisiana; that the Ilde on deposit represent 10 per cent of the assessments ollected from members of the respective associations and reserves for the purpose of paying claims brought about by unusual circumstances causing the death of a :eater number of members than is ordinarily anticipated, ; 4°1 as an epidemic of sickness or a tornado; that the as42eletions also carry regular checking accounts in which :_'4eY deposit all of their dues except the 10 per cent dePosited in savings accounts; that the associations are nonptrotitable and make no other investments; and that the inriTst derived from the savings deposits inures to the bene°f the reserve funds. ti "The Board of Governors has recently taken the posiill°11 that deposits of mutual or cooperative fire or life ass"ance associations may not be classified by member banks a"ings deposits and it is our opinion that deposits of th, above associations which are operated under the mutual insurance laws of Louisiana fall within the scope or this ruling. Accordingly, it is our view that deposits as these associations may not be classified by member banks s"ings deposits." Approved unanimously. Letter ertos to Mr. Dillistin, Assistant Vice President of the Fed- eear7e Bank of New York, reading as follows: re "This refers to your letter of September 25, 1936, a 41 cling the question whether deposits of 'The Pension kil' p Commission of the Police and Fire Departments of the clwIlshiP of Union', New Jersey, may be classified by member 1330 11/12/37 -4", 124anks as savings deposits under the definition in section ita) of Regulation (I. "As you were advised in a letter dated October 30, 1937 (8-41), the Board of Governors has recently taken the Position that police or firemen's pension or relief assocations d (including a special fund held by a political subvisthn to provide pensions for police or firemen) may be ' col.laidered as organizations operated primarily for religious, Philanthropic, charitable, educational, fraternal or other !111311ar purposes and, therefore, that deposits of such ornizations may be classified by member banks as savings P°alts if they otherwise comply with the requirements or the definition. It appears that 'The Pension Fund Com. 0 83lon of the Police and Fire Departments of the Township :Union' falls within the scope of the Board's ruling and, reordinaY, deposits of the Commission may be classified °Y __ . member banks as savings deposits if they comply in other l'esPects with the definition." r Approved unanimously. Letter to Mr. Day, President of the Federal Reserve Bank of San reading as follows: 16, "Reference is made to Mr. Sonnets letter of October 1936, regarding the question whether deposits of the 15,,:,11_strial Indemnity Exchange may be classified by member 1748 as savings deposits under the definition in section 'a) of Regulation Q. :In a letter dated November 10, 1936, you were adof-e that the Board of Governors agreed with the opinion Y°ur counsel that deposits of the Industrial Indemnity ge may not be classified as savings deposits. You " 2 we, also advised that the Board was reviewing a number of cel:raga with respect to the classification of deposits of ges srin organizations as savings deposits and it was saga ued that, if you had not already taken steps to obtain bel' ! classification of the deposits in question, the matter 'geld in abeyance until further action of the Board. "The Board has now completed its review of this subse ; and has issued a ruling thereon, a copy of which was to You under date of October 30, 1937. As you have no doubt observed, this ruling confirms the opinion expre83ed in the Board's letter of November 10, 1936." Approved unanimously. 1531 11/12/37 -5- Letter to Mr. Sargent, Vice President of the Federal Reserve Bziti of San Francisco, reading as follows: "This refers to your letter of August 11, 1936, and IT' later correspondence regarding the question whether a l‘ell°8it of the King County Medical Society may be classified ;'Y a member bank as a savings deposit under the definition in section 1(e) of Regulation Q. As you were advised in a letter dated October 30, 1—J7 (8-41), the Board of Governors has recently taken the posit' that professional associations, such as bar, medic,1and dentists' associations, may be considered as orlaizations operated primarily for religious, philanthropic, table, educational, fraternal or other similar purposes :.?4, therefore, that deposits of such organizations may be vlassified by member banks as savings deposits if they other,26 comply with the requirements of the definition. It ap;'"Irs that the King County Medical Society falls within the „e°Pe of the Board's ruling and, therefore, deposits of such ganization may be classified as savings deposits if they 114/1Y in other respects with the definition." T Z Approved unanimously. Thereupon the meeting adjourned. Chairman.
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