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Minutes of actions taken by the Board of Governors of the Feciel'ea Reserve System on Wednesday, November 21, 1951. PRESENT: Mr. Mr. Mr. Mr. Martin, Chairman Szymczak Vardaman Powell Mr. Carpenter, Secretary Mr. Sherman, Assistant Secretary Mr. Kenyon, Assistant Secretary Minutes of the meeting of the Board of Governors of the 44rea Reserve System with the Federal Advisory Council held on 4°17e/3113er 20, 1951, were approved unanimously. Minutes of actions taken by the Board of Governors of the 4cler Reserve System on November 20, 1951, were approved unanimously. Memorandum dated November 16, 1951, from Mr. Marget, Director, °4 of International Finance, recommending an increase in the e4larY of Mrs. Dorothy L. Helprin, Research Assistant in that 1)117181 On, from $4,035 to 4,160 per annum, effective November 25, 1951. Approved unanimously. tet Memorandum dated November 19 1951, from Mr. Townsend, Solicitor, liding that the resignation of Miss Joan A. Temple, Clerk-typist the 0 , rice of the Solicitor, be accepted to be effective, in accordEl/le e ith - her request, at the close of business November 30, 19)1. 14 Approved unanimously. 114zat Letter to Mr. Pondrom, Vice President of the Federal Reserve °I 'Dallas, reading as follows: 229(i 11/21/51 -2- "In accordance with the request contained in Your letter of November 14, 1951, the Board approves the appointment of Robert John Schoenhoff as an assistant examiner for the Federal Reserve Bonk of Dallas. Please 847ise us of the date upon which the appointment becomes effective and also as to salary rate." Approved unanimously. Letter to Mx. Bilby, Vice President of the Federal Reserve Bank or (3r1 , reading as follows: requested in your letter of November 9, 1951, tue Board of Governors approves the payment of $1,652.59 the Retirement System of the Federal Reserve Banks to pcermit the reinstatement of Mr. Thomas J. Roche, Assistant rahier of the Foreign Operations Division, Foreign Departellt, without loss of creditable service. "It is understood that Mr. Roche has withdrawn his fflimulated contributions from the International Monetary retirement system and that there will be no duplicaZlon of the creditable service acquired while serving with °le Fund. "It is noted in your letter that Mr. Roche will conbute the sum of $900, which represents the amount he oTild have paid to the Retirement System had he not been 4 leave of absence." Approved unanimously. of, 43. Letter to Mr. Bowman, Vice President of the Federal Reserve Bank arlta, reading as follows: "Reference is made to your letter of November i. 1951, re questing the Board's approval of an increase in the valuation allowance heretofore established against the industrial ells to Polk Milk Company, Cedartown, Georgia. "The Board authorizes an increase of $282.17 in the allowance t;;o for estimated losses against the industrial loans the Polk Milk Company, as requested in your letter. It Ileted that after the additional allowance is established e 10an balances will be written off." Approved unanimously. 11/21/51 -3- Letter to Mr. Latham, Vice President of the Federal Reserve Bpnk or 13311, reading as follows: "In view of your recommendation and the information contained in your letter of November 15, 1951, the Board of 90vernors further extends until June 30, 1952, the time with111 which the Union Trust Company of Springfield, Springfield, , 14ssachusetts, may establish a branch in West Springfield, 4assachusetts, under authority granted in the Board's letter cf December 18, 1950." Approved unanimously. Letter to Mr. Latham, Vice President of the Federal Reserve B,nk "In, reading as follows: "Reference is made to your letter of November 13, 1951, litting a request of B.M.C. Durfee Trust Company , Fall qnr, Massachusetts, for permission to reduce its capital ),600 through the retirement of 156 shares of common stock. retirement is to be effected after the declaration of a Per cent stock dividend, increasing the book capital from )13,000 to $615,600. In view of your recommendation, the Board of Governors 8 •13Proves the proposed reduction of 315,600 in the bank's capite, -L 11Pon condition that: (a) The reduction is effected prior to December 31, 1951. (b) Prior approval is obtained from the Commissioner of Banks for the State of Massachusetts. (c) The increase in common capital through the proposed 20 per cent stock dividend has been effected prior to any reduction in the capital." e_ ir Approved unanimously. Order as follows resetting date for oral argument in the matter b 4, 4.rtel -5, Inc., of Philadelphia, Pennsylvania, a registrant under 41414tio„ W, Consumer Credit: 4/21/51 "UNITED STATES OF AMERICA BEFORE TAE , BOARD OF GOVE,iNORS OF THE FEDERAL RESERVE SYSTEM IN THE MATTER OF 4, BARTELS, INC. ORDER RESETTING DATE FOR ORAL ARGUMENT This matter coming this day for consideration on : ,1esPondent H. Bartels, Inc.'s Request dated November 161 -L951 that, because of a prior commitment of Counsel for ! esPondent, the Board amend its Order of the 13th day of 4ovember 1951 by setting down the matter for Oral Argu! 14 nt on a date subsequent to December 17, 1951, the date ;nich was specified in said Order, and the Board having 1111Y considered the matter, it is ORDERED that: 1. The said Request be granted. „ 2. This matter be set down for oral argument before e Board on Friday, January 4, 1952, at 10:00 a.m. 3. Counsel for respondent and Solicitor for the Board e "h be limited to one hour for oral argument. This 21st day of November, 1951. BY the Board. (signed) S.R. Carpenter, Secretary." Approved unanimously. Telegram to the Presidents of all Federal Reserve Banks, reading 4 1,0110Ws: "Following extensive consultations with representaof trade interests concerned it appears that because certain types of arrangements which prevail widely in er commercial real estate field designed to protect intert8 of the lessee or the lessor it would be extremely diffixIllt at best to draft language for inclusion in Regulation I hich would satisfactorily deal with nonresidential leaseback arrangements, Since most of the lease-back type of fiei ing is carried out by large institutional lenders who er Participate directly in the Voluntary Credit Restraint ijgram or would be indirectly influenced by its policies, vi,°ccurred to us that the most appropriate way of dealing °1 the problem might be to request the national committee the Voluntary Credit Restraint Program to consider the tiv -8 4 d "121/51 .? -7- ”, Inclusion of leasing arrangements with respect to new properties as well as existing properties in their Program and exempt such leases from Regulation X. This was discussed with the national committee on November 17 and they indicated that they would be agreeable to an appropriate change in Bulletin Number 4 to provide for the screening of leases on new properties. It is contemplated that leasing arrangements ') )11 new construction would be included in the Voluntary Credit rogram only with respect to nonresidential property -- in Other words, commercial and industrial property -- and that, correspondingly, leases on nonresidential property would be exempt from Regulation X. No provision would be inserted in 'rgulation X with respect to leases on residential properties 4111ce we have very few questions regarding leases of this "Ype and we believe that these can best be handled under the Present language of the regulation. It is recognized, of urse, that under the proposal there will not be a completely ' I rective coverage of leases of the type which are in effect 8- substitute for credit, but it is hoped and expected that 141rge percentage of these will be screened under the VolunlrY Credit Program. It is also recognized that the arrange4111t will need to be closely watched so that if it appears k.a.t an unduly large volume of lease transactions of the in question are entered into without screening, the can be reconsidered. There is set forth below the mat ert t en- of the proposed amendment to Regulation X as well as the Change ' which would be made simultaneously in Bulletin No. Iior 4 the Voluntary Credit Restraint Committee. We will be glad O have any comments you may wish to make on this approach the lease-back problem or any specific suggestion with respect to the language of the amendment. Please wire any MInftts or suggestions you may have to reach us not later gan Tuesday, November 27." 2 J Approved unanimously. Secretary.
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