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Minutes for
To:
November 4, 1960
Members of the Board
From: Office of the Secretary
Attached is a copy of the minutes of the
Board of Governors of the Federal Reserve System on
the above date.
It is not proposed to include a statement
with respect to any of the entries in this set of
minutes in the record of policy actions required to
be maintained pursuant to section 10 of the Federal
Reserve Act.
Should you have any question with regard to
the minutes, it will be appreciated if you will advise
the Secretary's Office. Otherwise, please initial below.
If you were present at the meeting, your initials will
indicate approval of the minutes. If you were not present,
your initials will indicate only that you have seen the
minutes.
Chin. Martin
Gov. Szymczak
Gov. Mills
Gov. Robertson
Gov. Balderston
Gov. Shepardson
Gov. King
Minutes of the Board of Governors of the Federal Reserve System
on Friday, November
PRESNT:
4,
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
1960. The Board met in the Board Room at 10:00 a.m.
Martin, Chairman
Balderston, Vice Chairman
Szymczak
Mills
Robertson
Shepardson
King
Mr. Sherman, Secretary
Miss Carmichael, Assistant Secretary
Mr. Fauver, Assistant to the Board
Mr. Noyes, Director, Division of Research and
Statistics
Mr. Koch, Adviser, Division of Research and
Statistics
Mr. Keir, Chief, Government Finance Section,
Division of Research and Statistics
Money market review.
Mr. Keir reported on the Government
securities market, including the latest available information relating
to Treasury refunding operations. During the discussion following his
remarks, reference was made to recent System purchases of Treasury
certificates, notes, and bonds, in addition to bills, and the need for
a careful study of the long-range effects of such purchases with a view
to developing as much information as possible along this line as a
guide for future action.
Mr. Koch then commented on developments in the fields of bank
credit, money supply, and bank reserves.
Mr. Molony, Assistant to the Board, entered the room during
the money market review and at its conclusion withdrew, along with
Messrs. Koch and Keir.
meeting:
At this point the following joined the
4
11114/60
-2Mr. Hackley, General Counsel
Mr. Solomon, Director, Division of Examinations
Mr. Johnson, Director, Division of Personnel
Administration
Mr. Hexter, Assistant General Counsel
Mr. Rudy, Special Assistant, Legal Division
Mr. Hostrup, Assistant Director, Division of
Examinations
Mr. Goodman, Assistant Director, Division of
Examinations
Mr. Benner, Assistant Director, Division of
Examinations
Mr. Young, Assistant Counsel
Mr. Leavitt, Supervisory Review Examiner,
Division of Examinations
Discount rates. The establishment without change by the Federal
Reserve Banks of New York, Philadelphia, Kansas City, and San Francisco
on November 3, 1960, of the rates on discounts and advances in their
existing schedules was
approved unanimously, with the understanding
that appropriate advice would be sent to those Banks.
Items circulated or distributed to the Board. The following
items, which had been circulated or distributed to the Board and copies
of which are attached to these minutes under the respective item numbers
indicated, were approved unanimously:
Item No.
Letter to Virgin Islands National Bank, Charlotte
Amalie, St. Thomas, Virgin Islands, authorizing the
establishment of branches in Road Town, Tortola,
British Virgin Islands, and in Frederiksted, St. Croix,
Virgin Islands.
1
Letter to Union Trust Company, Greensburg, Indiana,
approving an extension of time to establish a branch
at 122 W. Washington Street.
2
Letter to Glenns Ferry Bank, Limited, Glenns Ferry,
Idaho, approving the establishment of a branch on Main
Street in Grand View.
3
-3-
11/4/60
Letter to the Federal Deposit Insurance Corporation
regarding the application of Security Bank, Myrtle
Point, Oregon, for continuation of deposit insurance
after withdrawal from membership in the Federal
Reserve System.
14
Letter to Union Bond & Mortgage Company, Port Angeles,
Washington, extending the period within which to
comply with the provisions of section 4(a)(2) of the
Bank Holding Company Act of 1956.
5
Report on competitive factors (New Paltz and Kingston, New York).
A draft of report to the Comptroller of the Currency on the competitive
factors involved in the proposed consolidation of The Huguenot National
Bank of New Paltz, New Paltz, New York, and The State of New York
National Bank, Kingston, New York, had been distributed under date of
October 31, 1960. The report concluded as follows:
The proposed consolidation would not eliminate any
existing banking facilities and would have little effect
on the competitive situation in Ulster County or in the
Kingston area. The resulting bank by virtue of its
larger resources and wider range of banking services would
be expected to intensify competition in the area now served
by Huguenot National Bank.
No objection being indicated, the report was approved unanimously
for transmittal to the Comptroller of the Currency.
Application of Marine Midland Corporation (Items 6 and 7).
Pursuant to the Boards discussion on October 31, 1960, of an application
by Marine Midland Corporation, Buffalo, New York, for prior approval
under section 3(a)(2) of the Bank Holding Company Act of the acquisition
of voting shares of The First National Bank of Poughkeepsie, Poughkeepsie,
New York, an Order approving the application, a supporting Statement,
-4-
11/4/60
and a press release had been prepared and distributed with a memorandum
dated November
3, 1960, from the Legal Division.
There being no objection, the Order and Statement were approved
unanimously.
Copies are attached as Items
6 and 7, respectively.
Messrs. Noyes, Hostrup, Rudy, and Leavitt then withdrew from
the meeting.
Use of examiners and examination reports in a criminal case
(Item No.
8). There had been distributed a memorandum from the Division
Of Examinations dated November
3, 1960, regarding further developments in
the use of examiners and examination reports in the criminal case of U.S.
V, Baron deHirsch Meyer, et al, involving the trial of certain officers
Of North Shore Bank, a member bank in Miami Beach, Florida.
Attached to
the memorandum was a telegram from Chief Examiner Sheffer, Federal Reserve
Bank of Atlanta, quoting a report from Federal Reserve Examiner R. Paul
Wilson who, pursuant to a request from the Department of Justice, had
been sent to Miami in connection with this case.
Examiner Wilson
indicated that it was likely that he would be requested by Assistant
United States Attorney Brons to testify in the trial and to produce
examination reports, condition reports, and supporting papers relative
to North Shore Bank.
Also, he had been requested by Mr. Brons to go
into North Shore Bank and Industrial National Bank to review records.
Mr. Sheffer, in his telegram, indicated that the Federal Reserve Bank
11/4/6o
-5-
of Atlanta preferred not to use examining powers in aid of criminal
investigation and requested advice from the Board on the two questions
raised in Examiner Wilsonts report.
It was noted in the memorandum that Mr. Coburn, General Counsel
Of the Federal Deposit Insurance Corporation, had informed the Division
Of Examinations that the Corporation had directed their examiner, who
was also in Miami with reference to this case, to refuse to enter either
Of the banks.
However, Mr. Coburn felt that the question was somewhat
different so far as the Corporation was concerned since both banks were
member banks and there would be considerably less reason for a Federal
Deposit Insurance Corporation examiner to enter them for any kind of
en examination than if the bank were an insured nonmember.
Mr. Coburn
had indicated that he planned to meet with Mr. Kossack of the Department
of Justice in order to discuss the need for maintaining the confidentiality
Of
examination reports and to clarify the function of examiners in this
and similar cases.
In commenting on the memorandum, Mr. Solomon said that the immediate
question was whether Examiner Wilson should be permitted to go into North
Shore Bank and Industrial National Bank to review their records.
There
l'78.8 the further question involving testimony by Examiner Wilson and use
°f bank examination reports during the trial.
Mr. Hackley reported that he had talked with Mr. Coburn following
his (Mr. Coburnts) meeting with Mr. Kossack, who had said that the case
(1 1 4S
-6-
11/4/60
would be tried by the United States District Attorney rather than by
Mr. Brons, Assistant United States District Attorney.
As a result of
the conference with Mr. Kossack, Mr. Coburn was inclined to be as
cooperative as possible with the Department of Justice, and he was
Prepared to recommend to the Board of Directors of the Federal Deposit
Insurance Corporation that their copies of examination reports be sent
to Miami with the understanding that they would remain in the custody
Of their examiner and that only pertinent excerpts from the reports
relating to the specific charges involved could be used as evidence
in the trial.
Also, Mr. Coburn now felt that it would not be unreasonable
to permit examiners to go into the two banks to review records if the banks
and the counsel for the defense consented.
The alternative would be for
the bank records to be impounded and for the examiners to go into the
banks as prospective witnesses for the Government rather than as examiners.
In response to a question from Chairman Martin regarding the
possibility of the issuance of a subpoena, Mr. Solomon replied that,
'while he had no information as to the plans of the United States District
Attorney, it would appear that the issuance of a subpoena related more
to the trial itself.
The immediate question was whether the Federal
Reserve Examiner should go into the two banks with or without the
consent of the banks and the defense.
If the Examiner were asked to
g° in as an examiner against the wishes of the banks, this would, Mr.
11/4/6o
-7-
Solomon thought, be a serious matter.
On the other hand, if the banks
and counsel for the defense agreed that this would be a convenient way
to have the records brought into court, there would still be some
question as to the procedure.
Chairman Martin expressed the opinion that the Board should
cooperate with the Department of Justice although the method and
extent of such cooperation were not clear.
It would seem appropriate
for examiners to review the records of the two banks if the banks
and the defense consented.
If they did not consent, the problem
would be different, possibly involving the issuance of a subpoena.
Governor Mills said that he would agree with the approach
suggested by the Chairman but with the understanding that examiners
would enter the banks only on the basis of unequivocal consent on the
Part of the banks and the defense.
His approach was based on the
premise that the examination of a bank and the record of examination
were confidential between the bank and the supervisory agency and, as
such, were completely apart from the litigation now in progress.
That
being the case, Governor Mills observed that the only basis on which
he could justify release of information from examination reports by
the Federal Reserve Bank of Atlanta as the supervisory agency would
be
if,
in the process of examination, the Reserve Bank had discovered
°Perations within the bank that were of a character that should have
been reported to the Federal Bureau of Investigation.
If there were
11/4/6o
no such occurrences and no allegations to that effect, it was his opinion
that the Board should not permit examiners to enter the case except
under subpoena, the same as any other witness that would be subpoenaed
and brought before the court. If there was a completely friendly
invitation from all parties concerned to permit the examiner to enter
the banks and compile information, Governor Mills thought that the
procedure would be in order. That, he said, was the extent of
cooperation that he thought should be permissible.
Chairman Martin indicated that he would favor permitting
examiners to go into the two banks to obtain information if consent
could be obtained from the banks and counsel for the defense.
There being no objection to this procedure, it was understood
that a telegram would be sent to the Federal Reserve Bank of Atlanta
granting permission for Examiner Wilson to review records of North
Shore Bank and Industrial National Bank provided written consent was
obtained from defendants and the two banks, or counsel therefor. A
copy of the telegram sent pursuant to this action is attached as
Item No. 8.
Governor Balderston then suggested that it might be helpful for
Mr. Hackley to discuss with the Department of Justice the other
questions raised in the telegram from Mr. Sheffer, indicating the
Boardls desire to cooperate and expressing the hope that the United
States District Attorney would not issue a subpoena that the Board
might find it necessary to oppose.
415
11/4/60
Mr. Solomon said that he thought such a procedure would be
desirable in connection with the immediate question and also because
such a conference might serve as a means of disposing of further
questions that may arise with reference to the case.
Mr. Hackley asked whether, in talking with Mr. Kossack, it
would be appropriate to indicate that the Board wished to cooperate as
fully as possible in this case but was opposed to the use of examination
reports in evidence and hoped that Federal Reserve Examiners would not
be placed in the position of responding to subpoenas.
Chairman Martin said that the Board's thinking appeared to be
along these lines and that Mr. Hackley might discuss the matter with
Mr. Kossack. In this connection, he felt it might be desirable to
delegate authority for disposing of this particular problem, which had
already taken a considerable amount of the Board's time.
Governor Robertson observed that on November 2, 1960, the Board
had taken the position that the confidential section of the examination
report would not be furnished for use in the trial, and he felt it
important to maintain this position. He noted that other similar cases
would be coming up from time to time, and he wondered if there might not
be some procedure for disposing of them without bringing the details to
the Board for consideration.
Governor Mills expressed the view that in matters of this type
where there were differences of opinion the problem should be brought
5`
-10-
11/4/60
to the Board for consideration.
If, for example, the problem under
consideration were delegated to him for solution, he might reach a
different decision than if the disposition of the same problem had
been delegated to another Board member.
He felt that matters of this
type should be considered by the entire Board.
Chairman Martin indicated that further questions on this case
should be brought back to the Board for consideration. He then expressed
concern over the large portion of the Board's time that was involved in
details relating to bank supervision, relative to that available for
consideration of monetary and credit matters.
It was important for the
Board to give attention to this problem and to review the whole procedure
for carrying on the Board's work in order to determine whether more
effective methods than those now used could be agreed upon.
Salaries for officers at New York Reserve Bank (Item No. 9).
Pursuant to the favorable recommendation of the Division of Personnel
Administration, as set forth in a file that had been circulated to the
Board, unanimous approval was given to a letter to the Federal Reserve
Bank of New York approving payment of salaries to Robert L. Cooper and
Paul Meek as Managers at the rates fixed by the Board of Directors.
A
copy is attached at Item No. 9.
All members of the staff with the exception of Messrs. Sherman
and Fauver then withdrew from the meeting.
11/4/60
Appointment of directors at Federal Reserve Banks and branches.
There had been distributed three memoranda from Mr. Fauver dated
November 2 and 3, 1960, containing names of possible appointees as Class
C directors at the Federal Reserve Banks of New York and Minneapolis and
a director at the Helena Branch.
Question was raised as to whether there would be objection to
having men connected with foundations, such as the Ford, Rockefeller,
and Carnegie Foundations, serve as Federal Reserve Bank or branch
directors. It was the consensus that there should be no general rule
against drawing directors from the academic world or from foundations
and that each appointment should be considered on the basis of the
particular circumstances existing at the time.
After discussion it was voted unanimously to ascertain whether
the individuals listed below were eligible for and would accept appointment as directors of the Federal Reserve Banks and branch indicated for
the terms shown:
Everett Needham Case, President of Colgate University,
Hamilton, New York, as a Class C director of the Federal
Reserve Bank of New York for a three-year term beginning
January 1, 1961.
Owen Meredith Wilson, President of the University of
Minnesota, Minneapolis, Minnesota, as a Class C director
of the Federal Reserve Bank of Minneapolis for a threeyear term beginning January 1, 1961.
Harry K. Newburn, President of Montana State University,
Missoula, Montana, as a director of the Helena Branch of
the Federal Reserve Bank of Minneapolis for a two-year
term beginning January 1, 1961.
115
.12.
11/4 60
Secretary's Note: It having been ascertained
that these appointments would be accepted,
telegrams were sent to Messrs. Case, Wilson,
and Newburn on November 102 212 and 8, 1960,
respectively.
The Board also appointed Erwin D. Canham, Editor, The Christian
Science Monitor, Boston, Massachusetts, as Deputy Chairman of the
Federal Reserve Bank of Boston for the year 1961.
The meeting then adjourned.
Secretary's Note: Governor Shepardson today
approved on behalf of the Board a memorandum
dated November 10 1960, from John T. McNeil,
Secretary in the Board Members Offices,
requesting permission to work part time as a
secretary at Georgetown University, Washington,
D. C.
E
Secretary-
CC-
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
Item No. 1
11/4/60
WASHINGTON 25. D. C.
ADDRESS
OFFICIAL
CORRESPONDENCE
TO THE SOARD
November
4, 1960
Virgin Islands National Bank,
Charlotte Amalie, St. Thomas,
Virgin Islands.
Gentlemen:
The Board of Governors of the Federal Reserve System authorizes Virgin Islands National Bank, Charlotte Amalie, St. Thomas, Virgin
Islands, pursuant to Section 25 of the Federal Reserve Act, to establish a branch in Road Town, Tortola, British Virgin Islands; and to
Operate and maintain such branch subject to the provisions of such
Section.
The Board of Governors also authorizes the establishment by
V
irgin Islands National Bank of a branch at No. 5A Strand Street,
Frederiksted, St. Croix, Virgin Islands, pursuant to the Agreement
entered into with the Board of Governors of the Federal Reserve System
under the provisions of Section 25 of the Federal Reserve Act; and to
operate and maintain such branch subject to the provisions of such
Agreement.
The locations of the branches may not be changed, after establishment, without the prior approval of the Board of Governors.
Unless the branches are actually established and opened for business
on or before November 1, 1961, all rights granted hereby shall be
deemed to have been abandoned and the authority hereby granted will
automatically terminate on that date.
Please advise the Board of Governors, in writing, through
,the Federal Reserve Bank of New York, when the branches are opened for
pusiness, furnishing information as to the exact location of the Road
Town branch.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
BOARD OF GOVERNORS
4o
4
OF THE
CO001+,
.*
FEDERAL RESERVE SYSTEM
Item No. 2
11/4/60
WASHINGTON 25. D. C.
*
ADDRESS OFFICIAL CORRIESPONOENCC
TO THE BOARD
November
4 1960
Board of Directors,
Union Trust Company,
Greensburg, Indiana.
Pursuant to your request, the Board of Governors
of the Federal Reserve System extends the time within which
Union Trust Company may establish a branch at 122 W. Washington Street, in Greensburg, Indiana, to February 2, 1961,
under the authorization contained in the Board's letter
dated May 4, 1960.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
BOARD OF GOVERNORS
0******0
004 COnOv "
44;
OF THE
FEDERAL RESERVE SYSTEM
.)
Item NO. 3
11/4/60
WASHINGTON 25. D. C.
ADORE'S
44,
orricom. CORRESPONOENCIE
TO THE SOAR°
*0 41.m.$t.oP
November
4, 1960
Board of Directors,
Glenns Ferry Bank, Limited,
Glenns Ferry, Idaho.
Gentlemen:
Pursuant to your request submitted through the
Federal Reserve Bank of San Francisco, the Board of
Governors of the Federal Reserve System approves the
establishment of a branch on Main Street in Grand View,
Idaho, by Glenns Ferry Bank, Limited, Glenns Ferry,
Idaho, provided the branch is established within six
months from the date of this letter and provided the
approval of the State authorities is in effect at the
time the branch is established.
It is understood that capital funds in the
amount of $25,000 will be provided through the sale of
additional capital stock prior to the establishment of
the proposed branch.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
BOARD OF GOVERNORS
OF THE
Item No.
FEDERAL RESERVE SYSTEM
4
11/4/60
WASHINGTON 25, D. C.
ADDRESS orricIAL CORRESPONDENCE
TO THE BOARD
November
14. 1960
The Honorable Jesse P. Wolcott,
Federal Deposit Insurance Corporation,
Washington 251 D. C.
Pear Mr. Wolcott:
Reference is made to your letter of October 17, 1960,
concerning the application of Security Bank, Myrtle Point,
Oregon, for continuance of deposit insurance after withdrawal
from membership in the Federal Reserve System.
No corrective programs which the Board believes
should be incorporated as conditions to the continuance of
deposit insurance have been urged upon or agreed to by the
bank.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
Item No.
5
11/4/60
ADOREII• OrrICIAL COPIRCIIPONOCNCt
TO TNt BOARD
November
4, 1960
Mr. F. 0. Fountain, Secretary,
Union Bond & Mortgage Company,
First National Bank Building,
Port Angeles, Washington.
Dear Mr. Fountain:
This refers to Union Bond & Mortgage Company's application for an extension, from November 9, 1960, of the period within
Which it must comply with the provisions of section 4(a)(2) of the
Bank Holding Company Act of 1956.
In accordance with the provisions of section 4(a) of the
Act, the Board has granted the requested extension to and including
May 9, 1961.
Except for Union's holdings of voting shares of First
American Insurance Agency which are specifically exempted under the
Provisions of section 4(c)(6) of the Bank Holding Company Act of
1956, the assumption made in Union's application is correct; namely,
that pursuant to sections 4(a) and 4(c)(5) of the Act, by May 9,
1961, Union's direct and indirect holdings of shares of nonbanking
organizations shall not include more than five per cent of the outstanding voting shares of any such organization.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
Item No.
11/4/60
ITZITED STAT .S OF MICA
BEFORE THE BOAI1D OF GOVERNORS OF THE FEDERAL RESMVE SYSTEli
WASHILIGTON, D. C.
ON.
In the Matter of the Application of
MARINE IIIDLLID CORPORATION) Buffalo, New York
for prior approval of acquisition of
voting shares of The First National Bank
of Poughkeepsie) Poughkeepsie, Neu York
CRUM APPROVIEG API)EICATION UNDER
BANK HOLDLIG COMPANY ACT
There having come before the Board of Governors pursuant
to section 3(a)(2) of the Bank Holding Company Act of 1956 (12 USC
1843) and section 4(a)(2) of the Board's Regulation Y (12 CFR
222.4(a)(2)), an ap?lication on behalf of Marine Midland Corporation)
Buffalo, New York, for the Board's prior approval of the acquisition
Of all the voting shares of The First liationel Bank of Poughkeepsie,
Poughkeepsie) New York; a Notice of Receipt of Application having
been published in the Federal Register on August 11) 1960 (25 Federal
m
Legister 7662); the said 'Notice having provided interested persons
an opportunity, before issuance of the Board's final order, to file
comments and views regarding the proposed acquisition; and no such
comments or views having been filed;
6
41
-2IT IS HEREBY ORDERED, for the reascns set forth in the
Board's Statement of this date, that the said application be and
hereby is granted, and the acquisition by Marine Midland Corporation
of all the voting shares of The First National Bank of Poughkeepsie,
Poughkeepsie, New York, is hereby approved, provided that such acquisition is completed within three months from the date hereof.
Dated at Washington, D. C., this 4th day of November, 1960.
By order of the Board of Governors.
Voting for this action: Chairman Martin, and
Governors Balderston, Szymczak, Mills, Robertson,
Shepardson, and King.
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
(SEAL)
4162
BOARD OF GOVERNORS
Item No. 7
11/4/60
OF THE
FEDERAL RESERVE SYSTEM
APPLICATION BY MARINE MIDLAND CORPORATION, BUFFALO, NEW YORK,
FOR PRIOR APPROVAL OF ACQUISITION OF VOTING SHARES OF THE
FIRST NATIONAL BANK OF POUGHKEEPSIE, POUGHKEEPSIE, NEW YORK
STATEMENT
The Marine Midland Corporation, Buffalo, New York
to
("Marine"), a bank holding company, has applied, pursuant
section 3(a)(2) of the Bank Holding Company Act of 1956
("the Act"), for the Board's prior approval of the acquisition
of all the voting shares of The First National Bank of Poughkeepsie)
Poughkeepsie, New York ("Bank").
Views and recommendations of the Comptroller of the
the Board
Currency. - As required by section 3(h) of the Act,
forwarded notice of the application to the office of the
Comptroller of the Currency.
The Comptroller responded by
recommending approval of the transaction.
the
Statutory factors. - Section 3(c) of the Act requires
Board to take into consideration the following five factors:
company
(1) the financial history and condition of the holding
and bank concerned; (2) their prospects; (3) the character of their
the
management; (4) the convenience, needs, and welfare of
communities and area concerned; and (5) whether or not the effect
of the acquisition would be to expand the size or extent of the
bank holding company system involved beyond limits consistent with
adequate and sound banking, the pl:blic interest, and the preserva—
tion of competition in the field of banking.
Discussion, — Marine presently controls ten banks,
all in New York State, with 173 olTices and total deposits of
about 32 billion. Bank is located in Poughkeepsie, the county
seat of Dutchess County
about 72 miles north of New York City
on the east bank of the Hudson River. With total deposits of
about
$49.7 million, Bank is the largest commercial bank in the
County.
The financial history and condition, prospects, and
management of both Marine and Bank are satisfactory.
Considerations relating to the "convenience, needs, and
welfare of the communities and area concerned" lend little support
tor, but would not be inconsistent with, approval of the application.
There is some suggestion that the acquisition of Bank by Marine
Ilould provide Bankts community with additional banking services.
However, there is no evidence that Bank is not now providing
adequate banking services.
416el
-3An additional judgment required of the Board by
section 3(c) of the Act is whether the effect of the proposed
acquisition would be to expand the size or extent of Marines
holding company system beyond limits consistent with adequate
and sound banking, the public interest, and the preservation of
competition in the field of banking.
The proposed acquisition would not appear to result in
any significant lessening of existing competition between Bank and
Marine 2s present subsidiaries, the nearest office of which is
located about 40 miles from Bank.
Banks primary service area is regarded as a semicircle
with a radius of about 10 miles from Bank 2s main office and with
its western boundary being the Hudson River.
Bank is by far the
largest of four commercial banks in the primary service area.
How-
ever, a mutual savings bank in Poughkeepsie, one of two such banks
in the area, is much larger than Bank and it appears appropriate to
consider competition afforded by mutual savings banks as well as by
ecramercial banks.
The following tabulation shows Marinets percentages
Of offices and deposits (both total deposits and deposits of individuals, partnerships and corporations, "IPC" deposits) in various
a-reas before and after the proposed acquiEition, both as to comMercial banks and all banks:
41 6!"--4Per cent of
WM,.0.1=111V10.1141•11.
Banking
Offices
Prior
to
acq.
After
aco
40D
Primary service area:
Commercial banks
All banks
Ntchoss County:
Commercial banks
All banks
Third Banking District:
Commercial banks
All banks
State of New York:
Commercial banks
All banks
Depcsits
IPC
Total
After
Prior
After
Prior
to
to
acq,
acq,
acq.
acq0
iMM•011•000011
••••18
-
33.3
27.3
-
55.2
25.8
-
58.3
25.3
-
14,3
11.1
-
36.3
17.5
-
38.6
17.3
2.1
1.8
3,6
3.1
1.7
1.1
5,0
3.2
1.8
1.1
5.3
3.2
10.0
8.6
10,1
8.8
5.o
3.3
5.1
3.4
3.3
3.4
In the light of all relevant considerations, it is the Board's
illdgment that the proposed acquisition would not expand the size or
extent of Marine's holding company system beyond limits consistent with
adequate and sound banking, the public interest, and the preservation
°f competit4 on in the field of banking.
Conclusion. - Notice of Receipt of the Application was published
in the Federal Register on August 11, 1960 (25 Federal Register 7662)
affording interested persons an opportunity to submit comments and views
l egerding the proposed acquisition.
'
No comments or views were received.
Viewing the relevant facts in the light of the general
Purposes of the Act and the factors enumerated in section 3(c),
it is the judgment of the Board that the proposed acquisition would
be consistent with the statutory objectives and the public interest
and that the application should be approved.
li 11;f.
No.
8
Item
TELEGRAM
11/4/60
LEASED WIRE SERVICE
BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
WASHINGTON
November 4, 1960
SHEFFER - ATLANTA
Reurtel November 3. Please send following telegram in quotation to
Examiner Wilson:
Quote.
You are permitted to review records of
North Shore Bank and Industrial National Bank provided written consent
is obtained from all defendants and two banks, or counsel therefor,
authorizing you to make such investigation.
You must see such written
and signed authorization and it must be clear that investigation is not
a regular or special examination of the two banks performed under examining
Powers of Federal Reserve Act but is solely for purpose of reviewing
records and getting facts concerning litigation.
If you have any question
about written agreement to investigate, communicate with Federal Reserve
Bank.
This telegram should be shown to Mr. Brons.
End of quote.
In
connection with use of examination reports and other records at trial,
contact is being made with Justice Department to reach agreement as to
restrictions on use and you will be further advised.
(Signed) Merritt Sherman
SIERMAN
BOARD OF GOVERNORS
OF THE
Item No.
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRESS
orrociAL
CORRESPONDENCE
TO THE BOARD
November if, 1960
CONFIDENTIAL (rift)
Mr. Alfred Hayes, President,
Federal Reserve Bank of New York,
New York 45, New York.
Dear Mr. Hayes:
The Board of Governors approves the payment of
salaries to the following named officers of the Federal
Reserve Bank of New York for the period October 14 through
December 311 1960, at the rates indicated, which are the
rates fixed by your Board of Directors as reported in your
letter of October 18, 1960:
Name
Robert L. Cooper
Paul Meek
Annual
Salary
Title
Manager
Manager
$13,500
13,500
The Board has noted the advice regarding the separations of Assistant Vice Presidents Larkin and Gaines, and the
change in assignments of Messrs. Stone, Timlen, Trued, MacInnes,
and Waage, referred to in your letter.
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
9
11/4/60
@FedFRASER