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Minutes for To: Members of the Board From: Office of the Secretary November 6, 1962 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. Mills Gov. Robertson Gov. Balderston Gov. Shepardson Gov. King Gov. Mitchell Minutes of the Board of Governors of the Federal Reserve System on Tuesday, November 6, 1962. The Board met in the Board Room at 10:00 a.m. PRESENT: Mr. Mr. Mr. Mr. Mr. Mr. Martin, Chairman Balderston, Vice Chairman Mills Robertson Shepardson Mitchell Sherman, Secretary Molony, Assistant to the Board Fauver, Assistant to the Board Hackley, General Counsel Solomon, Director, Division of Examinations Mr. Connell, Controller Mr. Hexter, Assistant General Counsel Mr. O'Connell, Assistant General Counsel Mr. Shay, Assistant General Counsel Mr. Hooff, Assistant General Counsel Mr. Furth, Adviser, Division of International Finance Mr. Goodman, Assistant Director, Division of Examinations Mr. Leavitt, Assistant Director, Division of Examinations Mr. Thompson, Assistant Director, Division of Examinations Mr. Stephenson, Special Assistant, Division of Examinations Mr. Sprecher, Assistant Director, Division of Personnel Administration Mr. Bass, Assistant Controller Mr. Spencer, General Assistant, Office of the Secretary Miss Hart, Senior Attorney, Legal Division Mr. Egertson, Review Examiner, Division of Examinations Mr. Poundstone, Review Examiner, Division of Examinations Mr. Mr. Mr. Mr. Mr. 11/6/62 -2Report on balance of payments. At the Chairman's request, Mr. Furth presented a report for the information of the Board on the United States balance of payments. Circulated items. The following items, copies of which are attached to these minutes under the respective item numbers indicated, were approved unanimously: Item No. Letter to the Internal Revenue Service requesting a decision whether reimbursements made for costs incurred in the transfer of employees within the Federal Reserve System under certain conditions are subject to tax and withholding requirements. 1 Letter to the Federal Reserve Bank of New York with respect to a suggestion that authority be delegated to each Federal Reserve Bank to approve one extension of not more than six months beyond the Board's original authorization of the time within which a member bank or an Edge Act corporation may establish an approved domestic or foreign branch 2 With respect to Item No. 2, Governor Mills raised the question whether there was any doubt as to the Board's authority to delegate its responsibility in the matter of granting an extension of time during Which a member bank or an Edge Act corporation could establish a domestic or foreign branch. Mr. Hexter responded, pointing out that this was not a matter Where the Board would be delegating responsibility; if it were, then such a delegation might be questionable. Ordinarily, when the Board 11/6/62 -3- approved an establishment of a branch it placed a six-month initial limitation on the time for establishment of that branch, having in mind a possible six-month extension. It was now proposed that a letter be sent to each Federal Reserve Bank advising that the Board's letter of authorization to the applicant bank or corporation would continue to specify that the branch should be established within a certain Period. However, the letter of transmittal to the Reserve Bank would indicate that the Board's approval of the particular application included one six-month extension of time within which the branch could be established provided an extension was requested by the applicant and such action was deemed by the Federal Reserve Bank to be advisable. Advice of the Board's approval of such an extension would be given to the applicant only if the Reserve Bank felt that the request need not be submitted to the Board for consideration. A copy of the letter sent to each Federal Reserve Bank authorizing this procedure is attached as Item No. 3. Report on competitive factors (Charlotte-Lexington, North Carolina). There had been distributed a draft of report to the Comptroller of the Currency regarding the competitive factors involved in the proposed merger of The Commercial Bank of Lexington, Lexington, North Carolina, into First Union National Bank of North Carolina, Charlotte, North Carolina. r 11/6/62 -4During a discussion that related primarily to the banking structure in the State of North Carolina, there was an exchange of suggestions as to an appropriate conclusion that might be stated in this instance, following which unanimous approval was given to the transmittal of the report in a form containing the following conclusion: A merger of First Union National Bank of North Carolina and The Commercial Bank of Lexington would eliminate present and potential competition between them and expose the remaining local Lexington bank to the competitive abilities of a bank many times its size instead of one approximately twice its size. The merger represents the continuance of a trend in North Carolina toward concentration of banking resources in a few large banks. Report on competitive factors (Jenkintown-Coatesville, Penns lvania). A draft of report to the Federal Deposit Insurance Corporation on the competitive factors involved in the proposed merger of Industrial Valley Bank and Trust Company, Jenkintown, Pennsylvania, with The National Bank of Coatesville, Coatesville, Pennsylvania, had been distributed. Following a discussion in which agreement was expressed with a change in the conclusion that would reflect a suggestion made by Governor Balderston, the report was approved unanimously for transmittal to the Corporation with the conclusion reading as follows: While consummation of the proposed merger of Industrial Valley Bank and Trust Company, Jenkintown, Pennsylvania, and The National Bank of Coatesville, Coatesville, Pennsylvania, Would have little or no effect on banking competition in Philadelphia or Montgomery County, it would inject directly into central Chester County a relatively large bank, which might have some adverse competitive effects on the smaller banks operating in Chester County. so. r 11/6/62 -5Regulation Q. There had been distributed a memorandum dated November 5, 1962, from Mr. Hackley relating to the question whether the amendment of October 15, 1962, to section 19 of the Federal Reserve Act permitted a member bank that had issued a time certificate to a "qualified" foreign institution at a rate higher than that permitted by Regulation Q for domestic deposits to pay such higher rate to an individual or nonqualified organization who purchased the certificate from the foreign institution and who presented it to the member bank at maturity. As pointed out in the memorandum, the October 15 amendment exempted from deposit interest-rate ceilings "time deposits of foreign governments, mOnetary and financial authorities of foreign governments When acting as such, or international financial institutions of which the United States is a member." The memorandum went on to review various aspects of the question that had been raised and then indicated arguments that might be presented for or against construing the October 15 amendment as removing interest rate ceilings only with respect to time deposits made and held until maturity by one or more of the foreign institutions described in the amendment. Attached to the memorandum was a draft of a proposed interpretation which would indicate that the October 15 amendment did not apply to a deposit which was transferred to an individual or an institution of a kind other than those described in the amendment. 11/6/62 -6At the Board's request, Mr. Hackley commented on the question, basing his remarks substantially upon the information contained in the memorandum of November 5. He pointed out, among other things, that if a member bank, for example, issued a six-month certificate of deposit payable to a foreign central bank "or bearer" at a fixed rate of interest, the member bank's refusal to pay the certificate at maturity With the stipulated rate of interest might subject it to the risk of a suit for noncompliance with its contract. Of course, contracts were subject to applicable provisions of law; however, the amendment of October 15 contained no specific provision regarding the question that had been raised. Member banks would be adequately protected, however, if they and their depositors were advised in advance of an interpretation by the Board taking the position that the depository member bank could not pay interest on the deposit at a rate in excess of that prescribed by the Board pursuant to Regulation Q. Mr. Hackley continued by saying that during a telephone discussion with counsel for the Federal Deposit Insurance Corporation, it was indicated that the Corporation probably would concur with the Board's interpretation and would publish a similar interpretation. However, it was felt desirable to discuss the proposed interpretation With the Treasury Department's staff in order to obtain their views before it was presented to the Corporation's Board for approval. In If - 11/6/62 -7- this connection, it was contemplated that if the draft interpretation were now approved by the Board, it would not be published in the Federal Register until the matter had been discussed with the Treasury's staff and approval given by the Federal Deposit Insurance Corporation to a similar interpretation applicable to nonmember insured banks. Simultaneous publication could then be made in the Federal Register. Question was raised as to the procedure that would be followed by the Board's staff in the event the Treasury indicated objection to the proposed interpretation, to which Mr. Hackley replied that the matter would then be brought back to the Board for further consideration. The proposed interpretation with respect to the October 15, 1962, amendment to section 19 of the Federal Reserve Act was then approved unanimously, with the understanding that the procedure outlined by Mr. Rackley would be followed before the interpretation was published. Application of Walker Bank and Trust Company. There had been d istributed copies of a memorandum from the Division of Examinations dated October 23, 1962, and a memorandum from the Legal Division dated October 31, 1962, regarding an application of Walker Bank and Trust Company, Salt Lake City, Utah, to merge with First National Bank of Price, Price, Utah. The Federal Reserve Bank of San Francisco recommended favorably on the application, as did the Division of Examinations. Reports cm competitive factors received from the Comptroller of the Currency and the Attorney General were adverse, while the report from the Federal Deposit Insurance Corporation was not unfavorable. 11/6/62 -8In its review of the application in the light of the various factors enumerated under section 18(c) of the Federal Deposit Insurance Act, the memorandum of the Division of Examinations noted that the asset condition of the resulting bank would be satisfactory; its capital structure would be adequate, and its future earnings prospects would be favorable. With respect to management, emphasis was placed on the problem at First National, it being stated that the management situation had been a serious problem for the past couple of years. In this connection, a brief history of the bank was given to explain the management situation. With regard to the convenience and needs of the communities to be served, it was stated that merger would have little or no effect on the convenience and needs of the areas presently served by Walker Bank. With respect to the area in which First National was located, it was indicated that there was no substantial evidence supporting the contention made in the application that a need existed in Carbon County for a bank with a large loaning limit; also, while the resulting institution would offer trust services not presently offered by banks in Carbon County, the need for such services was believed to be limited. With respect to the effect of the proposed transaction on competition, it was the view of the Division of Examinations that due to distance and geographical barriers there was virtually no competition existing between First National and Walker Bank. In its memorandum of October 31, the Legal Division stated that it had reviewed this application with particular reference to the Board's 7 11/6/62 -9- denial of an application by First Security Corporation, Salt Lake City, Utah, for prior approval of the acquisition of all of the voting stock of Carbon Emery Bank, which was also located in Price, Utah. The Legal Division was of the opinion that there would be sufficient legal basis on which to differentiate the diminution of competition which would have resulted from the acquisition of Carbon Emery Bank by First Security from that which could be expected to result from the merger of First National with the Walker Bank. Further, the management problem in the present case would seem to be of considerable dimensions due to dissension between leading stockholders in the Price bank, and that would seem to supply some additional ground for approval. The Legal Division concluded that a decision either of denial or of approval would probably be upheld by the courts. At the Board's request, Mx. Leavitt commented in some detail regarding the application and the reasons underlying the favorable recommendation of the Division of Examinations, his remarks being based on the information presented in the October 23 memorandum. In the course of his remarks, Mr. Leavitt referred particularly to the management problem at the Price bank, noting that there was dissension between two major stockholders, and that dissension between one of those s tockholders and the bank's chief executive officer had been a serious Problem. MI". Leavitt suggested that, if the application were approved, 11/6/62 -10- it would seem necessary for the Board to make some fairly strong comments in its statement with respect to the management situation. During discussion, Governor Robertson raised the question whether the Board would be justified in criticizing the management of the Price bank without first obtaining some additional information on this subject from the Comptroller of the Currency. Mr. Leavitt stated that while the Comptroller had not commented about the management situation in his report on competitive factors, the report of examination made by the Comptroller's Office indicated that the problem was significant. There followed further discussion centering on the question whether or not it would be desirable to ask the Comptroller to comment on the management of Price National. General agreement was indicated with the view that it was doubtful whether the Comptroller would be able to provide more information on the management factor than was available in the reports of examination made by his Office. Governor Mills questioned whether the Board actually was prepared to say that the management problem at Price National would be the sole basis for approval. In his view, the management factor was a marginal element; however, in the background of this case were two bank holding companies--First Security Corporation and Western Bancorporation. In the case now being considered, Western Bancorporation, which owned 90 Per cent of the capital stock of Walker Bank, was before the Board in -11- 11/6/62 the guise of a merger by Walker Bank with Price National. Beyond that merger, there was obviously the question of expansion of the holding company. to However, as he saw it, the resources that would be added the holding company system through this merger would not be of such magnitude as to represent an undue concentration. In the State of Utah, Security holding company activity had tended to be monopolized by First Corporation. would be Governor Mills went on to say that he felt the Board acting reasonably if it approved this application on a basis whereby the management factor was of some importance in its decision, but not of overwhelming importance. application Mr. Solomon observed that when the Board denied the of First Security Corporation to acquire Carbon Emery Bank in Price, First Security had not taken the decision into court for judicial review. In his opinion, if this application were approved, it seemed reasonable to assume that First Security might file for reconsideration of its application. for the views Following further discussion, the Chairman called of the members of the Board. indicated, he Governor Mills said that, as he had previously would approve the application. -12- 11/6/62 Governor Robertson stated that he would deny this application. The earnings of the Price bank were good, and its capital position excellent. The existence of a conflict between two families owning, between them, a majority of the shares of the bank did not justify, in his opinion, permitting the second largest bank in the State to move into the area, especially when in a comparable case the Board had denied the application of First Security Corporation to go into the same community. Governor Shepardson commented that in his view there was a distinct difference between this case and the one involving First Security Corporation. He would approve this application. Governors Mitchell and Balderston and Chairman Martin also indicated that they would approve the application. Accordingly, the application of Walker Bank and Trust Company was approved, Governor Robertson dissenting. It was understood that the Legal Division would prepare an order and supporting statement for the Board's consideration. Request for copy of the application of Walker Bank and Trust *— Cctr an During the foregoing discussion relating to the application Of Walker Bank and Trust Company, Salt Lake City, Utah, Miss Hart reported that a letter had been received from a stockholder of Walker Bank, John D. Rice, Esq., asking that a copy of the application be sent to him. Miss Hart noted that Mx. Rice's request raised the question Whether the Board should make available to the public an application in - 11/6/62 -13- a case where no public hearing was held. However, in this particular case, the Legal Division had been able to verify that a copy of the application was on file at the office of the State Commissioner of Banking, and that the Commissioner had indicated that relevant portions of the application would be made available upon request. A draft of letter to Mr. Rice had been prepared giving this information and, unless there was an objection by the Board, the letter would be sent. There being no objection indicated, it was understood that a letter along the lines outlined by Miss Hart would be sent to Mr. Rice in response to his inquiry. Miss Hart and Mr. Egertson then withdrew. Application of United Virginia Bankshares, Incorporated. There had been distributed memoranda from the Division of Examinations and Legal Division dated, respectively, October 30 and November 5, 1962, regarding an application by United Virginia Bankshares, Incorporated, Richmond, Virginia, to acquire more than 50 per cent of the voting shares of Citizens Marine Jefferson Bank, Newport News; First and Citizens National Bank of Alexandria, Alexandria; First National Trust and Savings Bank of Lynchburg, Lynchburg; Merchants and Farmers Bank of Franklin, Franklin; State-Planters Bank of Commerce and Trusts, Richmond; and The Vienna Trust Company, Vienna. The Federal Reserve Bank of Richmond recommended approval, as did the Division of Examinations. At the Board's request, Mr. Thompson commented in some detail on the application, his remarks being based on the memorandum of the Division 11/6/62 -14- of Examinations, following which there was an expression of tentative views by the members of the Board present. Governor Mills said that he was inclined to agree with the reasons supporting approval of the application, as cited by Mr. Thompson and set out in the memorandum from the Division of Examinations. Governor Robertson stated that while attempts had been made to distinguish the instant case from the applications of Morgan New York State Corporation and First Bancorporation of Florida, he was unable to find valid grounds for making a distinction. State-Planters, the second largest bank in Virginia, would be affiliating with five other banks in a holding company that would control over 10 per cent of all bank deposits in the State. He questioned whether there were benefits to be derived from the transaction that would offset the diminution of competition. Throughout the file, Governor Robertson commented, a great deal was said about the advantage that the holding company arrangement would Provide in enabling the subsidiary banks to make larger loans as a result Of the pooling of their resources. In his view, there was no indication that larger loans could be made without withdrawing some resources from the smaller loans that the individual banks now made. If any one of the banks found itself in a tight credit situation, it could go from one correspondent bank to another. However, as part of a holding company, the bank could not follow the same practice. On balance, he could not see how the public interest would be served through approval of this transaction. I'4 11/6/62 -15Governor Shepardson observed that Virginia had been primarily an agricultural State, but was now in the process of developing industrially. It had a growing population, and there would be a need for additional financial resources. It seemed to him that a combining of banking resources, through a mechanism such as the proposed holding company, would provide greater. strength and greater opportunity to meet the development needs of the State. Governor Mitchell noted that he found this case a difficult one on which to reach a conclusion. It did seem to him that the cases involving Morgan New York State Corporation and First Bancorporation of Florida could be distinguished from the one now before the Board. In this case, however, he believed it was the intent of the applicant to give more weight to the credit needs of large firms than to small local customers, and he was apprehensive about approving a merger where this factor was being stressed. Large firms could go outside an area, or state, to obtain credit, but small firms found it difficult to obtain credit in that manner. He tended to agree with the point raised by Governor Robertson that credit needs of the smaller local customers might suffer if this transaction were approved. Governor Balderston said that he found it difficult to make a d istinction between this case and the application of First Bancorporation of Florida. The only distinction he could make was in the matter of correspondent banking business. In this case, there was just one large 11/6/62 -16- correspondent bank involved; in the Florida case, there were several correspondent banks involved. Chairman Martin made the observation that it was difficult to compare cases. In his opinion, each case should stand on its own merits; conditions in Virginia were quite different from those in Florida or New York. His own feeling was one of agreement with the views expressed by the Federal Reserve Bank and the Division of Examinations. Following further discussion, and in light of the varying views that had been expressed, it was agreed to hold over the application for further consideration at a time when all of the members of the Board were available. The meeting then adjourned. Secretary's Note: Pursuant to recommendations contained in memoranda from appropriate individuals concerned, Governor Shepardson today approved on behalf of the Board increases in the basic annual salaries of the following persons on the Board's staff, effective November 11, 1962: Name and title Division Basic annual salary To From Board Members' Offices Mary Catherine Davian, Secretary $ 6,500 $ 6,705 11,515 11,880 11,880 12,245 Research and Statistics Gerald F. Millea, Chief,Administration Section Dorothy S. Projector, Economist - 11/6/62 -17- increases, effective November 11 ?Jame and title 1962 (continued) Basic annual salary From To Division Administrative Services $ 3,770 6,448 3,350 3,350 Eugene Edward Bishop, Guard Edward Cross, Photographer (Offset) Charles L. Greene, Messenger Marie E. Kinder, Charwoman , Secret ry $ 3,875 6,781 3,455 3,455 I Item No. 1 11/6/62 BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM WASHINGTON 25, D. C. ADDRESS OFFICIAL CORRESPONDENCE TO THE BOARD November 6, 1962 Commissioner of Internal Revenue, Internal Revenue Service, W ashington 25, D. C. Attention: T:R:E. Dear Sir: dated October In a release from the Secretary of the Treasury 1) 1962, to the Heads of Government Departments and Agencies and Others Concerned, the Commissioner of Internal Revenue has held that: newly "Amounts paid by an employer to or on behalf of a in employee such by incurred hired employee for the expenses place new the to goods d househol moving himself, his family and Fedfor 'wages' ances, circumst of employment are, under the ding eral employment tax purposes and for purposes of withhol Of income tax at source on wages." Governors of It is respectfully requested that the Board of to whether as decision a with d furnishe the Reserve System be s within employee of transfer the in incurred f!imbursements made for costs t!le Federal Reserve System under the following conditions are subject to Commissioner's ruling referred tne tax and withholding requirements of the to above. utilize the The Board of Governors believes that it should capabilities and experience of System employees to the best interest of a uniform the System. To accomplish this purpose, the Board has followed Banks to the icY for the transfer of employees from the Federal Reserve D. C. ,?ard of Governors of the Federal Reserve System in Washington, ese transfers are at the instigation of the Board and the Board reimin moving the urees or pays on behalf of the employee the costs incurred , and his family from 1.'_ousehold goods and personal effects of such employee established in tjesidence in a Federal Reserve Bank area to a residence a the employee of _flls area. The Board also pays the transportation costs for the emnce d his family and a per diem allowance in lieu of subsiste is policy this P°Y while he is in a travel status. The Board feels transof cases in y generall ;insistent with that followed by the Government r r l between the There are certain similar conditions in transfers in that the y generall nt I3anks and the Board to transfers in the Governme 1)0,04ir) Commissioner of Internal Revenue 2 He SYstem employee is considered an "old" rather than a "new" employee. Reserve Federal the from benefits System able to transfer his Retirement 'Qank to the Federal Reserve Board without loss of credit under the Retirement System of the Federal Reserve Banks. He is also able to transfer his nnual and sick leave to his credit with the Board. The transfer is so ! 7rranged as to assure continuity of employment in order that he may be fully '=overed under the life insurance and health benefits programs of the Banks and the Board. The Board of Governors believes that transfers of employees restraint Ilithin the Federal Reserve System should be made with as little !! Possible and with as little expense as possible to the employee concerned, terathe primary benefit in such transfers accrues to the Federal Reserve Sys" The Board feels that if a withholding tax should be levied on such which Payments the employee would be unduly burdened with costs over he nas beneprimary the for are transfers little or no control. As these emthese of behalf on or to plt of the System, it is felt that payments tiees for the cost of moving them, their families, and household goods to for the moveWashington, D. C., area, should be viewed as payments made of "old" employees. transferee from As the Board has no such obligation to other than a staff as a its to addition P a ederal Reserve Bank, it considers any other for the ent reimbursem make wlY hired employee and does not, of course, himself of costs tion transporta of moving his household goods or for "family into the Washington, D. C., area. Z Very truly yours, (Signed) Merritt Sherman Merritt Sherman, Secretary. BOARD OF GOVERNORS Item No. 2 11/6/62 OF THE FEDERAL RESERVE SYSTEM WASHINGTON 25. D. C. ADDRESS OFFICIAL CORRESPONDENCE TO THE BOARD November 6, 1962 Mr. Alfred Hayes, President, Federal Reserve Bank of New York, New York 45, New York. Dear Mr. Hayes: This will acknowledge receipt of Mr. Treiber's letter of September 24, 1962, suggesting that the Board delegate to each Federal Reserve Bank the authority to approve on behalf of the Board one extension of not more than six months beyond the Board's original au thorization of the time within which the member bank or an Edge Act corporation, acting for itself or in behalf of an affiliate, may establish an approved domestic or foreign branch. It is noted that, in your opinion, adoption of this procedure would be a less burdensome and more expeditious method of handling the increasing volume of these requests without lessening the Board's exercise of its statutory power 1,71th respect to establishment of branch offices. It is believed that the following procedure would accomplish the same purpose as your recommendation while avoiding any possible question as to whether the Board is empowered to delegate such authority to the Reserve Banks. When the Board approves an application !?r branch authorization, it will provide for not only an initial 11.-mitation on the period for establishment of the branch but also one lx-months' extension; however, the applicant will not, at that time, ! °e notified regarding the extension. If the applicant subsequently requests an extension and it appears that there are no substantial c,hanges in circumstances and the applicant has exercised reasonable :1 1gence in attempting to establish the branch, the Reserve Bank, 411 !lthout submitting the matter to the Board, will advise the applicant chat the Board has approved a six-months' extension of time within /.7111-ch the branch may be established and will send the Board a copy of : !•,ts letter.to the applicant. However, if the Reserve Bank believes that tle Board may wish to reconsider the advisability of an extension of lme, the applicant's request should be submitted to the Board with the , "serve Bank's recommendation. Very truly yours, (Signed) Merritt Sherman Merritt Sherman, Secretary. Item No. 3 11/6/62 BOARD OF GOVERNORS OF THE S-1846 FEDERAL RESERVE SYSTEM WASHINGTON 25, D. C. ADDRESS OFFICIAL CORRESPONDENCE TO THE BOARD November 9, 1962. bear sir establishment of In connection with extensions of time for the made anches by member banks and Edge Act corporations, the Board has d outline le)Tain changes in the procedure to be followed heteafter, as less t a somewha °w. it is believed that this procedure will provide s without request such g handlin of method IfIrdensome and more expeditious authority with respect to u sening the Board's exercise of its statutory ! 'e establishment of branch offices. bt authorization to the Under this procedure, the Board's letter of that the branch is specify icant bank or corporation will continue to months. The six ily ordinar Itoetbe established within a definite period, e that indicat , however Cr of transmittal to the Reserve Bank will, six-month one s include tion t Board's approval of the particular applica cL e d an provide shed, establi extension of time within which the branch may be Reserve Federal the by ension is requested by the applicant and deemed tlink to be advisable. Advice of the action by the Board in authorizing . si in the absence of a rech an extension is not to be given to the applicant Bank feels that the Reserve s t for an extension and then only if the rere deration because reconsi thluest need not be submitted to the Board for Cr has been no substantial change in circumstances and the applicant ord exercised reasonable diligence in attempting to establish the branch. the matter to the Board, 1 narilY, the Reserve Bank, without submitting d a six-month extension approve advise the applicant that the Board has of A copy of the Reserve shed. establi lian me within which the branch may be Board. If circumthe to s letter to the applicant should be sent ' sta should be subrequest nt's mitnees have changed materially, the applica . ndation recomme ted to the Board with the Reserve Bank's appi 4 on is called In considering requests for extensions, your attenti to ing indicat #3575), th S. the e Board's letter of November 4, 1953 (F.R.L. bank a that appears it ,wili Board's attitude toward applications where be unable to open a branch reasonably promptly. Very truly yours, man, Merritt Secretary. TO ritt,, '-ar, PRESIDENTS OF ALL FEDERAL RESERVE BANKS
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