The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
f395 Minutes of actions taken by the Board of Governors of the Pilertt 1 Reserve system on Tuesday, November 30, 1948. The Board rilet in the 1.1 Qoard Room at 2:35 p.m* PREs T: Mr- McCabe, Chairman Mr. Eccles Mr. Szymczak EX.. Draper Mr, Evans 1,41-% Vardaman Mr. Clayton Mr. Mr. Mr. Mr. Mr. Mr. Carpenter, Secretary Sherman, Assistant Secretary Morrill, Special Adviser Thurston, Assistant to the Board Riefler, Assistant to the Chairman Smead, Director of the Division of Bank Operations Mr. Thomas, Director of the Division of Research and Statistics Mr. Vest, General Counsel Bero 1141c4 e this meeting the Presidents of the Federal Reserve ellblitted t a zemorandum covering topics discussed at their trieettnr, November 29, 1948, which were to be reviewed the joint meeting to be held at 10:30 a m -,zoper 1948. thed. The matters were discussed and it was under- 4813°Asee would be made substantially along the lines iathe aeParate minutes of that meeting. At thi NrI,014 th -..8 Point Messrs. Riefler, Smead, Thomas, and Vest with— d :44i kfiN e leetin g and the action stated with respect to each of l'44"einafter referred to was taken by the Board: tl9ii; 1. Ree Milmates of actions taken by the Board of Governors of the Fedrve Ystem on November 29, 1948, were approved unanimously. likk of Letter to Mr. Fulton, Vice President of the Federal Reserve Clevela.nd, reading as follows: 1948:Reference is made to your letter of November 2/4., el ' egarding the request of The Sylvania Savings (3f th;°111 , 4Pa1:13r, Sylvania, Ohio, for a 60-day extension Posed-L'une within which the establishment of its prothe urancuu in Adams Township, Lucas County, Ohio, at beaine tersection of Dorr Street and Reynolds Road, may or p__e°mPlished under the approval granted by the Board mlri7rnors on June 16, 1948. pebrlAct ri View of your recommendation, the Board extends "lellt 0 `J "-f f the o 1949 the time within which establishranch may be accomplished." Approved unanimously. Lette... Ot 4, 44e Boa. Ncler PrePared in accordance with the action at the meeting rti Q11 November 16p 1948, to Mr. Volberg, Vice President of aeServe Bank of San Francisco, reading as follows: ! FN.° The r Board's staff has been processing the applie °b7148Lank of America N. T. & S. A. for permission -1:11)11 8t4t;""sn a forelp-n branch at Bangkok, Siam, which " tc, Seel-tn % °11 Was forwarded to the Board in your letter chlrtiPtiae,jer 309 1948. In connection therewith the :krrenheb," recent1y written to the Comptroller of Fedthe rj and to : the Chairman of the Board of the ere -1,13(Isit Insurance Corporation to ascertain whether -c4Ird 4. " Avt -e anY reasons Ph known to such officers why the ,,d reject eba eph pe li lcation. It is expected will th d in the near future beQSa hp i elanot Mr. Hanl and members of the Board to ' eat& ' t- 8 and the other pending foreign branch ap4tt of 4.04 tBankhe Board.of America which have not yet been " oll itp fat tart 1.1r. enCe late-" t recent meeting the Board discussed these 194 18 in the light of yo your letter of September 481 which you state that you have made no 1.!: eLa 11/30/48 -j "atteta , t to obtain information concerning the business cond banking prospects in Bangkok but that the a (Ylng has apparently analyzed the situation carefully t arlp.,,4the 1 senior officer of the International Banking Departthat has visited Bangkok recently. You also pointed out 401111 1,4,471eW of the size of Bank of America it should have risio—^4'cultY in supplying adequate personnel and superevostannItainaid.that the capitalization of the bank is bal Aneri: in , view of the fact that, since June 1946, Bank of eigt "a8 applied for permission to establish nine forjurie es and that, as appears from your letter of Perti,,!,'948) there is every likelihood that it will seek pos-.7.4°11 t0 establish additional ones (thus signifying thoros'h,_le global expansion), the Board feels that a more tiorallen analysis of the problems posed by these applica. 24should be undertaken by the San Francisco Reserve eotpreeh that the Board may have the benefit of a more 4 sseete rv10-118811 th ei evB sor ale.d port and recommendation. In this conparticularly desires to have the Reit the alikts analysis of recent important developments (31 'the ever-all economic, political and financial aspects the inatter 4 --`4. so far as they may have an impact upon ArtiP eei Zt'°ns of present and potential branches of Bank The Board would also like to have a more de•J•te b,1',PPraisal of the factors respecting Bank of America, t: h 4-1ricliiries and personnel, which should be considered by re,formulating a general policy for dealing with 4-gn branch applications of this bank." Approved unanimously, together with letters to the Honorable Preston Delano, Comptroller of the Currency, and the honorable Maple T. Earl, Chairman, Federal Deposit Insurance Corporation, read-Lag as follows: Letter to Mr. Delano QitInti° ,esL ank ., r of America National Trust and Savings applica... Assot1 -4" rrancisco California, has filed an Permission to ' an at Bangkok, Siam. establish a branch rd "hsther .tt be appreciated if you will advise the Boa lther si 01.2,0ill Your opinion there are any reasons, relating iv.4.7 Capital structure consideracture of Bank of America, b ,! cp10 , -.1%end _ policies or other pertinent f which wI should this application sho eted b3r bas of the Board." -4-Letter to Mr. Hanl ciet."The Bank of America National Trust and Savings Assot61°,11, San Francisco, California, has filed an applic/!- ;')11 pernission to establish a branch at Bangkok, Siam. Mleth it will be appreciated if you will advise the Board col, sr there are any reasons, from the standpoint of your poal.)c)rationts position as the insurer of the domestic debe lts of the Tit. f-tica, why this application should reject by the Zioate. Letter to Mr. Volberg, Vice President of the Federal Reserve 441 'or P.._ Francisco, reading as follows: tict "The Board of Governors has approved the applirNZ,The Wendell National Bank, Wendell, Idaho, or elosAT-Llo fiduciary power, as evidenced by the enthe letter which you are requested to forward to elosePelicent. A copy of such letter is also enfor your files. "it corl • . le understood that the bank has already agreed P :!*Ire its earnings until a satisfactory relationrie its capital accounts and its total assets sk assets is achieved." Approved unanimously. Letter 11111 ° the /3 Prepared in accordance with the discussion at the meet- c)ar 'cl on November 17, 1948, for Chairman McCabe's signa114e t ° the4 tElcitrig '4°11°rable James E. Webb, Director, Bureau of the Budget, 118 f°11owe. ter : 114 res,, Nn ' ' - °4se to the portion of the President's letor ;l'eber 6 1948 in regard to the legislative proth:171 Federal Reserve System, there are set f,o tli ;:h "8.rd of7,-,Principal which with respect to subjects cN hi' '413vernors expects to propose legislationL No. 4,;e8erve Re 00411 Banks. - In Public Law uirements of /roved August 16 1948, Coness Congress authorized the ( a'PtIllattl.he'nors °ver in Order to prevent injurious credit b ° increase the reserve requirements of m?mrc,'8ert the Federal Reserve System within certain . This authority was coupled with a n0 change in reserve requirements thus 11/11n AJ48 _5t'authorized The B should continue in effect Pfter June 30, 1949. ation°ard had riot only recommended authority of longer dur' Deets but also of broader scope. Therefore the Board exto propose a more appropriate measure for dealing vseerviy in order to enable the System to cope paT;' 4 re br e eb n Ie rlk d ect r b with the problem that otherwise would be -Y the expiration of the authority referred to erttlit,• The at alon withsubject is being given very thorough consida view to the formulation of a recommendation elrEQ, later date when the present economic trends may be Littitted more accurately. appro C°1181thier Instalment Credit. - In Public Law No. 905, eorti•riii civ.t ecol AUgust 16, 1948, the Congress also authorized the 4. exercise certain controls with respect to consum8843 a'jaira tent credit in accordance with Executive Order recorani "P and including June 30, 1949. The Board had Naectnerici , ecl an authority of longer duration. The Board ".° Propose that the authority over consumer insta legiairedit be extended or made permanent by appropriate , the e)d ! a; i° ,n formulated in the light of experience under 8.1-1.1g regulation. The manner in which this might with vievi-,fni"t appropriately is receiving consideration corIcluar the introduction of a bill embodying the Board's a potiBazk d oid uring the early part of the next sessi Company Legislation. - A bill for the pep ,c!f Pr for the further control and regulaqv bj Dank oviding companies,S. 829, was reported ;11 the Qvu, ! LT holding the Senate ankin -- and Currency Committee 2'llocoti-Dart`jtot,11. Fo .ngress (Report No. 300, June 19, 1947)• \lee and " 0111, H.R. 3351, was introduced in the rttilittee referred to the House Banking and Currency -etl Since then, the details of the bill have riot wIthri--erg ()1. 'g an intensive review and a similar bill, i lig sub stantially from the provisions of S. 829, next '"a10c-iirse of favored the 11Q't 0 ri QOf'the preparation for presentation at Congress. Such legislation is trt11. bY the Board of Governors but also by the Fe eltiker. 18,°17 Council the Association of Reserve City t,' l'reli s 'ILI the two bankers! associations, independent , 8 114ittit, t as by the rlajority larger bank holding tl of the i'()Pteci-3 ' The American Bankers Association has recently };.St0,4 iourgingthe prompt enactment of leg41,11_114-1; losneethis. su Subject, ilo l ject. The subject matter of this pePar.L ) 11 discussed from time to time with the TreasI'Pc)r tioTie fit and the Federal Deposit Insurance C 4000 11/30/48 -6"Loans to Business Enterprises. - A bill, S. 408, pror8Z1 bY the Board of Governors, providing for guarantees tomleral Reserve Banks of loans by banking institutions 4ILlueiness enterprises was reported favorably by the Sen(Tte e ring and Currency Committee in the 80th Congress 3z68 No. 145, April 28, 1947) and a companion bill, H.R. liankLI'las introduced in the House and referred to the House 111*" .'ig and Currency Committee. The subject matter is vhatvrpreviev by the Board for the purpose of determining Coz -r°Posal will be appropriate for submission to the illt;7888 at the next session. The Treasury Department is aectlested in certain aspects of this bill, which involves °,11 13b of the Federal Reserve Act. Nie rril itel.B olli2aita.tu agLiltAtliqtftr_litlals.§_of the rteserve stem. - The Board of Governors in its the Ire„2Port8 11 to the Congress has called attention to 014 i;IgY su bstantial and unnecessary impediment to memberFederal Reserve System involved in certain eaPital requirements for admission to member-of for the establishment of out-of-town branches ta be banks. It has proposed that these require411 /61:4-1lainated or very substantially modified and a this purpose in view is in the course of preptio ueposit— i The Comptroller of the Currency and the Federal Neq'llsurauce Corporation have an interest in the it„!Latter of this legislation. N.ch; ,111e there may be other matters with respect to the 440 would later find it desirable to recomNet ' 6 action by the Congress during the forthcoming °11 t tktters'Jle f oregoing subjects embrace the principal %Illteht -411 the field of possible legislative action to Poi. he B 'tot i-°a1'd is now giving attention from the stand8 res ponsibilities in the banking field." Z) en? Approved unanimou Secretary.
@FedFRASER