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3566 A meeting of the Federal Reserve Board was held in VgashingO Thursday, Lovember 22, 1934, at 11:30 a. m. PRESENT: Er. Er. Mr. Er. Er. Li'. Eccles, Governor Thomas, Vice Governor Hamlin Liner James Szymczak Er. Morrill, Secretary Er. Bethea, Assistant Secretary Mr. Carpenter, Assistant Secretary The Board acted upon the following matters: 161egram dated November 21, 1934, from Mr. Wood, Chairman of the Federal Reserve Bank of St. Louis, advising that, at a meeting of t4 b "rd. of directors on that date, no change was made in the bank's "'I'tilog s chedule of rates of discount and purchase. Without objection, noted with approval. Telegram dated November 21, 1934, approved by six members of yard, to Ur. LcClure, Chairman of the Federal Reserve Bank of Zkatte CitY, reading as follows: "Your letter tor November 15. Federal Reserve Board approves J.21,1 Your bank, effective immediately, flat commitment rates on II:atrial advances to financing institutions of -% for periods molaj,xeeeding three months, 1% for periods in excess of three aix -8 and not for periods exceeding excen1.0,/.1ths and exceeding six months, not exceeding nine months, and 2-i; for periods is J.:', 11:t nine months and not exceeding twelve months. As it to eated by 011 c desirable action your executive committee that it may be to charge rates higher than rates stated above tor°171:1:Litments direct to borrowers, it is suggested your direcra.tcs Ix and submit to Board for approval minimum and maximum ricers° e°rilmitments direct to borrowers with authority to of"on each commitment within limits of minimum "41 gu;fili%Tzel. Approved. 3567 11/22/34 4, Letter to Lr. lioxton, Federal heserve Agent at the Federal Reserve Bank of Richmond, reading as follows: "In connection with the report of examination of the 'Stal,elaanters Lank and Trust Company', Richmond, Virginia, of June 12, 1934, it has been observed that, among other things, you ! 1", , ,ve taken up with the bank the apparent violations of section A of the Federal Reserve Act on account of the bank's adve-nees to affiliates. It is not clear that, in your considera:cm of this matter with the member bank, you had in mind that , ,10 bank had acted in violation of the provisions of the Federal "eserve Act in purchasing stock of Kimbrell's Inc. In this connection, attention is called to the fact that, under the r°visions of section 9 of the Federal Reserve Act, as amended ty the Banking Act of 1933, a member bank, with certain excep2.?Ils which do not appear to be applicable in this case, may not Purchase stock in another corporation. Accordingly, it is Tested that, if you have not already done so, you call this POit also to the attention of the member bank; and it is asthat you will obtain correction of this matter along with s': 0 11 other matters criticized in the report of examination as n as Possible and advise the Board from time to time in the ere seeett V t ; Approved. Lettei. to Lr, O'Connor, Comptroller of the Currency, reading wit_ • _ • 193, 'tuceipt is acknowledged of your letter of November 12, $ with reference to the proposed reduction in common capi,`t 1 stock of the 'New First National Bank in New Hampton', New 43.1r, n Iowa, which was approved by the Board on February 21, for: Pursuant to a plan which provided, among other things, fltere ta1 Y contribution of 420,000 to be made by local sts for the purpose of eliminating unsatisfactory assets. • Y°u now advise that the bark's condition has been improved , 11c:e the original program of capital rehabilitation was formuthat the amount of assets scheduled for elimination in to i'sPort of examination of October 8, 1034, has been reduced co,Z??8 than the amount of the capital reduction, and that no 441butio11 is necessary. With, in view of the improvement reported, and in accordance lour rec by ommendation, tho Board amends its previous approval 420.01 6ing the requirement for a voluntary contribution of the, ,%is with the understanding that the other provisions of Plan as originally approved remain unchanged. 11 3568 11/22/34 -3- "It has been noted that since the report of examination July 26, 1933, there has been an increase of approximately sP294,000 in the bank's deposit liability, resulting in an somewhat undercapitalized condition. It is assumed, however, that this matter is receiving the attention of your office." Approved. Letter to ir. Hoxton, Federal Reserve Agent at the Federal Reserve B ank of Richmond, reading as follows: Reference is made to Lr. Fry's letter of lovember 5 inquiring whether, in the circumstances described in his letter, a menber bank is required to reduce its holdings of Federal Reserve bank stock incident to the retirement of preferred ;took. It appears that SCUD time prior to the issue of preerred stock, when the member bank reduced its surplus from cll. n „$ to 500,000, it elected to retain 300 excess shares Federal Reserve bank stock held as a consequence of such :aduction; that when its capital was increased from 01,000,000 'to ,14,050,000 by the issue of preferred stock, the bank was 84 !t allowed to subscribe to additional Federal Reserve bank Jock because it held 270 shares of such stock in excess of 1.4.e amount required on the basis of its revised aggregate capan-di surplus; and that the bank feels that, inasmuch as it I.2'.not increase its holdings of Federal Reserve bank stock 2eIdent to the issue of preferred stock, it should not now be 'tesquired to reduce its holdings of Federal Reserve bank stock a result of the retirement of preferred stock. Act 'Under the provisions of Section 5 of the Federal Reserve to f , 114 Section II of Regulation I, a member bank is required an application for the surrender and aPPrlie cancelation of an red:riate kmcunt of Federal Reserve bank stock whenever it llowiZ! its own capital stool-. Accordingly, the bank should pedc:-r-e ea application for the cancelation of 30 shares of Reserve bank stock incident to the reduction of toter)in its capital stock, or for the cancelation of its excess holdins of 300 shares of such stock." Approved. the Letter dated Lovember 21, 1934, approved by six members of ,Joard, to , seN LeClure, Federal Reserve Agent at the Federal Reliank of Kansas City, reading as follows: 3569 11/22/34 -4- "There are inclosed the original and copies of the Clayton Act pernit granted to Ir. henry Schafer, Oklahoma City, Oklato serve at the same time as director of Fidelity National ' '4 a4k of Oklahoma City, Oklahoma City, Oklahoma, as director and officer of The Citizens 1;ational Bank of El Reno, El Reno, ?klahona, and as director and officer of The Farmers National "calk of' ,"hite Deer, Mite Deer, Texas. "In considering this application, it was noted that there f" a possible impairment of the capital of the Fidelity La.T6i°11a1 Bank of Oklahoma City 'then the bank was examined on .11 Y 13, 1934, but that it had been rehabilitated subsequently ;"religh the sale of preferred stock to the Reconstruction Corporation and to local interests. It was also noted thltrethe management of the bank was not considered safe, the examiner having stated in the confidential section of his Port that 'unless a general and material improvement, based !Pcn the cleaning up program now in process is hereafter mainined, it will probably be found advisable to recommend and 11831 upon certain changes in the management of this brInk.' 230 It Was also noted that Ir. Schafer resides approximately es fram the recently organized The of Farmers National Bank Aite Deer and that although he attended a majority of the eeto-meetinrs of The Citizens National Bank of El Reno the past two years, he attended only eighteen of fortymeetings held by the directors of Fidelity National Bank of aillna City during the same period. spoInasmuch as the applicant apparently was not directly reha.nsible for the matters criticized by the examiner, the Board ce; l'anted the permit, but it suggests that you endeavor, in hrgeration with the appropriate supervisory authorities, to 13-1.0ut an improvement in the management of the Fidelity the :nal Bank of City. Oklahoma It is also suggested that when r_ s vermit is sent to Lr. Schafer you advise him that the Board r::te that a director of a bank should have a satisfactory inZd cf ic s , 1 8 :1:g indischarging his duties and responsibilities by particthe management and operations of the bank which he 451:11g, including attendance at directors' meetings. tioh 'ne Board reporr a resultrequests that, when you submit your reconmendaof your annual review of this permit, you provein fullY as to the progress made in bringing about an inattend„ in the management of this bank and as to the applicant's ace at directors' meetings. terlt "PY of the permit and a copy of this letter are being ot t the ealas.” Federal Reserve Agent at the Federal Reserve Bank r Lov APDro ved, together with a letter, also dated ember 21, 1934, and approved by six members of 3570 /1 11/22/34 -5the Board, to LI.. Walsh, Federal Reserve Agent at the Federal Reserve Bank of Dallas, inclosing a copy of the Clayton Act permit referred to above, and requesting that, when the agent submits his recommendation as a result of his annual review of the permit, he report fully as to the applicant's attendance at directors' meetings of The Farmers fiational Bank of White Deer, Texas. Letters dated November 21, 1934, approved by six members f the vising Board, to applicants for permits under the Clayton Act, adOf approval of their applications as follows: 141** R. A. H. Brandt, for permission to serve at the same time !),.? a director and officer of the First National Bank in Linot, Lorth Dakota, and as a director of The First National Joank in Mobridge, Lobridge, South Dakota. P4 J. Schirber, for permission to serve at the sam time 14rs_a director and officer of The First National Ban in Nooe, llobridge, _r_ldge, South Dakota, and as a director and officer uz the Glencross State Bank, Glencross, South Dakota. Approved. There 'were then presented the following applications for °IrlaIlges in stock of Federal reserve banks: A lleation for ORIGINAL Stock: Shares 44tional Bank of Commerce in Pamhuskas I'elshiazeka, Oklahoma 72 72 lications so.ztrict No. for ADDITIONAL Stocks 2 4s Pirst National Bank of Freehold s ,hAPreehold 3 1 Jersey 44)1 ehants and Farmers National Bank of D sville, New York of ge(;114shingt ano County National Bank Gel-1'44171'11es G see Itiver ranville, New York 1_41 National Bank of Lount 10 1'Lount Licwris, New York iatioaal Bronx Bank of New w York: z_ork, New York B 4orkiLational of Long Island in New New York, New York 105 87 78 72 180 60 582 11 3571 11/22/34 A l ications for ADDITIONAL Stocks District o. • S 'iNtedesboro Trust Company, Sw edesboro, Lew Jersey -6(Continued Shares 18 18 240 240 vort Lad Port isciri7W.vings Bank, Ladison, Iowa 27 27 District No. 8. outhern Commercial and Savings Bank, St, Louis, Lissouri 84 84 District No. 5. The eoples National Bank of Parkersburg, Par kersburg, West Virginia Iriatrict No. 9. ihe First ,,, kill, National Bank of Buhl, ' he FirstMinnesota N ational Bank of Caledonia, Afr.,_ge Caledonia, Linnesota First iatj011 Bank of McIntosh, 4Intosh, Linnesota lications for bURREUDER of Stocks Istrict No. 2. 4e PirirkiliTT7 enal B of West New York, West New York, New Jersey strlct No. 4110 5. zens National Bank of Hampton, 44111ncm., Virginia 14etriet 8. heiotk kr s t?.8 National Bank of Hot Springs, The Th PrInge, Arkansas 'eoPles National Bank of St. Fran cisville, TheSt. Franclle, Illinois Pirst National Bank of Petersburg, ,Ilitersburg, Indiana („3..rst National Bank of Clayton, ''.12(Yten, Lissouri D i4t 14 riet No. 9. et:iret Lational Bank of Larshall, 1'13411, Linnesota 6 9 10 Total 25 976 300 300 60 60 66 27 27 32 152. 15 15 3572 11/22/34 AP l ications for SURREhDER of Stock: (Continued) rjct The Ober 10. li: 71713:TY3nal Bank, Oberlin, Kansas Colt:gore° Trust Kanzas City,Company, Lissouri Shares 60 1,200 1,260 30 30 District No. 11. ihe Brady National Banks Brady, Texas ..1A,t2Itlpt No. 12. -the Amie-Frelia— kational Batik of Portland, Portland, Oregon 300 Total Approved. Thereupon the meeting adjourned. PProved Governor. 300 2,117
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