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2290 Minutes of actions taken by the Board of Governors of the Federal Reserve System on Tuesday, November 20, 1951. PRESENT: Mr. Mr. Mr. Mr. Martin, Chairman Szymczak Vardaman Powell Mr. Carpenter, Secretary Mr. Sherman, Assistant Secretary Mr. Kenyon, Assistant Secretary Minutes of actions taken by the Board of Governors of the Federal Reserve System on November 19, 1951, were approved unanimously. Letter to Mr. Denmark, Vice President of the Federal Reserve B .i, an4 'of Atlanta, reading as follows: "In accordance with the recommendation contained in your letter of November 14, 1951, the Board of Governors extends to February 15, 1952, the time wlthin which The First Bank of Alabaster, Alabaster, Alabama, may accomplish membership. Please advise the applicant to this effect." Approved unanimously. Letter to Mr. J. Luther Cleveland, Chairman, Board of Di- tOrs, Guaranty Trust Company of New York, 140 Broadway, New York, lie y °Iic, reading as follows: "There are enclosed two copies each of the reports or,i2. examination of the foreign branches of Guaranty Trust mPanY of New York made, as of the dates indicated beew, by examiners for the Board of Governors of the deral Reserve System: London Branches--June 14, 1951 Paris Branch --July 13, 1951 Brussels Branch--July 25, 1951 r 11/20/51 -2- "These examinations were made jointly and in cooperation with examiners for the Banking Department of the State of New York. The second copy of each of the reports is for the information and files of the officer in charge of the respective branch. "Your courtesy in acknowledging receipt of these reports will be appreciated." Approved unanimously, for transmittal through the Federal Federal Reserve Bank of New York. Letter to the Honorable Telford Taylor, Administrator, Small erense Plants Administration, Washington, D. C., reading as follows: "This is in response to your letter of November 13, IL-951, with its enclosures, regarding the practice which has been followed by many prime contractors of requiring a subcontractor to permit a general right of setoff against payments due under the subcontract, as the result Of which the value of such subcontracts as collateral fOX' either public or private loans has been impaired. "You state that you and Mr. Symington believe that would be useful to arrange a meeting of representatives of the interested Government agencies to consider this problem and you request that the Board designate a representative to meet with Mr. Richard C. Dyas of your agency and to participate in making recommendations for action by your agency and the other interested agencies. TAhis is to advise you that Mr. Gardner L. Boothe, II, esistant Director of the Board's Division of Selective 1/4„:redit Regulation, and Mr. Howard H. Hackley, Assistant 'eneral Counsel, have been designated for this purpose; 'nd they will be glad to cooperate in every way possible J-11 connection with this matter." Approved unanimously. Memorandum dated November 15, 19510 from Mr. Leonard, Director, 14.11184 n of Bank Operations, recommending that the Board reimburse lueizbe ' 13 of the Federal Reserve study group recently sent to Puerto 11/20/51 -3- at the request of the Insular Government in the amount of $390l5 to cover certain items of expense which it appeared should not be ellal"ged to the Puerto Rican Government. Approved unanimously. Letter to the Presidents of all Federal Reserve Banks and the Vi l' Presidents in charge of the Detroit and Los Angeles branches, ng as follows: "You will find enclosed a copy of a memorandum from the Office of the Assistant Secretary of Defense dated November 9, 1951, signed by John S. Bachman, Chairman of the Contract Finance Committee, requestthe Federal Reserve Banks to furnish narrative descriptions of their practices and procedures in the establishment and supervision of V-loans. Four copies Of each narrative are desired for the military establishment and it is suggested that you furnish the Board with a fifth copy so that it will be available should any of the other guaranteeing agencies desire similar information. "A draft of the Defense Department's memorandum was discussed informally by Mr. Bachman with Mr. Peyton and Mr. McConnell when he was in Minneapolis recently. 4180 a copy was sent to the Federal Reserve Bank of New York for comments and suggestions. The Federal Reserve Bank of New York prepared a paper together with pertiT)nt exhibits covering the practices and procedures zollowed by that Bank under the V-loan program. A copy (If Mr. Phelan's letter to Mr. Bachman dated October 26, 1951, together with a copy of the New York Bank's memoare enclosed with the thought that they might us helpful to your consideration of this matter." Approved unanimously.
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