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326 A meeting of the Federal Reserve Board was held in the office of the Governor on Tuesday, November 9, 1926 at 10:30 a.m. PRESENT: Governor Cri ssinge r Mr. Platt Mr. Hamlin Mr. Miller Mr. James Mr. Ounnin?,ham Mr. Eddy, Secretary Mr. McClelland, Asst. Secretary The minutes of the meeting of the Federal Reserve Board held on 11o7ember 3rd were read and approved. Telegram dated November 3rd from the Chairman of the Federal Reserve Bam, ,Of Boston, advising that the board of directors on that day made no ch4nge in the bank's existing schedule of rates of discount and purchase. Noted. Letter dated November 4th from the Secretary of the Federal Reserve 1344k of New York, advising that the board of directors on that day made 40 chance in the bank's existing schedule of rates of discount and purchase. Noted. Telegram dated November 5th fram the Secretary of the Federal Reserve 84clIc of Cleveland, advising that the board of directors on that day made no chaage in the bank's existing schedule of rates of discount and purchase. Noted. Telegram dated November 4th from the Chairman of the Federal Reserve 11441c of St. Louis, advising that the board of directors on that day made no )1r harige in the bank's existing schedule of rates of discount and purchase, their rates for purchases of bankers' acceptances being as follows: 327 11/9/26 -2- 1 to 45 days 46 to 120 days 121 to 180 days 31/2% 33/4% 4% Noted. Telegram dated November 4th from the Deputy Chairman of the Federal Reserve Bank of San 7rancisco, advising that the board of directors on that daY made no chanPe in the bark's existing schedule of rates of discount ahd purchase. Noted. Matter approved on initials on November 5th, namely, application of the American Exchange - Pacific National Bank of New York, N. Y. on behalf °f The American Exchange - Pacific Bank of New York for membership in the Federa1 :Reserve System, and for 9,600 shares of stock in the Federal Reserve Baaik of New York, said application having been arproved effective if and When the American Exchange - Pacific Bank of New York is duly incorporated and subject to the regular conditions contained in the Board's Regulation 11, and the further condition that immediately upon its incorporation the a - 111a Of directors of the Arerican Exchange - Pacific Bank shall pass ' ' l esolution ratifyin,7 the action of the American Exchange 4- Pacific National ' accept41-k in applying on its behalf for membership in the System and in ing membership subject to the conditions imposed by the Board, a copy of slIch resolution and also a copy of the bank's certificate of incorporation to be furnished the Board. Formally approved. 328 I 11/9/26 -3- Matter approved on initials on November 6th, namely, letter dated November 6th from the Acting Comptroller of the Currency recommending approval °I a salary of 43600 per annum for National Bank Examiner George R. Hallman, to be assigned to the Eleventh Federal Reserve District. Formally approved. Report of Executive Committee on letter dated November 2nd from the Comptroller of the Currency, recommending approval of an increase from 45600 to qc ,,,000 per annum in the salary of National Bank Examiner R. M. Hodgson; the Committee also recommending approval. Approved. Report of Executive Committee on letter dated November 2nd from the Comptroller of the Currency, recommending approval of a salary of :2500 Par annum for National Bank Examiner S. Marcus Greer, to be assigned to the Zoventh Federal Reserve District; the Committee also recommending approval. Approved. Report of Executive Committee on letter dated November 3rd from the Comptroller of the Currency, ream:unending approval of a salary of .,;;3,000 Per anaum for National Bank Examiner William M. Wilson, to be assigned to the Tenth Federal Reserve District; the Committee also recommending approval. Approved. Report of Committee on Salaries and Expenditures on letter dated 1701reraber 5th from the Assistant Federal Reserve Agent at St. Louis, request114t aPproval of the action of the Executive Committee of that bank in voting to grant leave of absence, with full pay, on account of illness for one month 329 11/9/26 -4- from November 1st to 1:r. H. T. Cummings, an anployee of the Memphis Branch; the Committee also recommending approval. Approved. Letter dated November 5th from the Assistant Federal Reserve Agent at New York, advising that the Bank of United States will open about January 1, 1927, a branch at Claremont Parkway, Third Avenue and 171st Street, Bronx 3orough, New York City. Noted. Draft of circular latter to the Governors of all Federal Reserve Banks, transmittinr; statement of expenses totaling ,;44,509.68 in the par clearance case of the Pascagoula National ,t5ank v. Federal Reserve - eserve bank Bank of Atlanta et al, and requesting that each Federal R rolait to the Federal Reserve Bank of Atlanta its pro-rata share of this expense, based on capital and surplus as of November 3, 1926. Approved. 'latter ordered circulated at the meeting on November 2nd, namely, letter dated October 28th from the Assistant Federal Reserve Agent at 344 Francisco, transmitting copy of a letter addressed to the Pacific Southwest Trust and Savings Bank, Los Angeles,ty the State Superintendent ef Banks, relative to an examination of the bank which was started on Pobruary 6th. Referred to the Committee on Examinations. Ilemorandum from Counsel dated October 23rd, with reference to rePort adopted on March 15, 1926,by the General Committee on BankersALcceptances 330 ;1/9/26 -5- and submitted to the Governors' Conference in narch 1926, at which Conference it was voted to approve the report and to request the Federal Reserve Board to adopt the recommendations contained therein; Counsel recommending qualified approval of the report and its publication in the Federal Reserve Bulletin and submitting a proposed circular letter to all Federal Reserve banks expressing the Board's qualified approval of the report. Ordered circulated. Memorandum dated October 27th from General Counsel, approved by the Law Committee, with reference to H. R. 10,000, a bill to consolidate, codify and re-enact all of the general and permanent lams of the United States in force on December 7, 1925, thich was adopted by Congress on June 30, 1926; Counsel submitting draft of a letter to the Chairman of the Committee on lievision of Lams of the House of Representatives, transmitting a memorandum Pointing out errors which have been discovered in those portions of the Code Which correspond to the provisions of the Federal Reserve Act and in Other statutes affecting the Federal Reserve System and recommending (1) That the letter and memorandum be nimeogTaphed and that copies be transtitted to the Chairman of the Senate Committee on the Revision of Laws 44d of the Banking and Currency Committees of both Houses and to all other Senators and Representatives who might be especially interested in the Pederal Reserve System or in the perfecticn of the Code; and (2) That his Qffice be authorized to confer with the codification experts employed by the Committee on the Revision of Laws in order to see that the errors are Properly corrected. 331 11 11/9/26 -6- Upon motion, it was voted that the proposed letter be transmitted to the Chairman of the Committee on revision of Laws and to approve Counsel's other recommendations. At this point, Lir. McIntosh entered the meeting. Letter dated November 5th from the Deputy Governor of the Federal Reserve 13az-4 Of New York, advising of the action of the board of directors of that bank veting, subject to the approval of the Federal Reserve Board, to authorize the oPening of an account with the Finlands Bank, the bank of issue of Finland, the establishment of a relationship with the Finlands Bank along the same gen- (11 ' 41 lines as their arrangements with other foreign central banks, and the 11 413Deintment of that institution as agent and correspondent of the Federal deserve 134111c in Finland in return for a similar appointment from them. Upon motion, it was voted to aTrove the action of the New York directors. Letter dated November 5th from the Comptroller of the Currency, re. -Is to the Board's letter of October 26th, requesting information as to the ctice of National Bank Examiners in checking the classification of deposits Ilational banks, with rarticular reference to the classification of deposits clt 17-thl1c funds. Ordered circulated.. lIr. Hamlin, on behalf of the Lan Committee, then reported verbally on the natter referred to the Committee at the meeting on February 19, 1926, namely, letter dated February 17th from the Devuty Comptroller of the Currency requesting rtv. 4-1111; as to whether or not the First National Bank of Boston may accept drafts ‘" upon it by the Yokohoma Specie Bank,Ltd. against the security of import 332 11/9/26 aad export bills of exchange previously discounted by the foreign bank. 141r. Hamlin stated that this question arose some time ago in connection With the authority of the National Park Bank of New York to accept such drafts, and that the Board had held it to be a refinancing transaction and 110t authorized bylaw, in view of the fact that at the time the acceptances were drawn the goods covered by the security bills had gone into consumption. Re stated that this question had been referred to the General Committee on ACceptances and that the Board's Committee had agreed with the report of the General Committee that national banks should be authorized to accept drafts drawn upon them by a foreign bank against the security of import and export bills previously discounted by the foreign bank where the import or export transaction has not been completed, and the goods involved therein have not gone into consumption. After discussion, Mr. Platt moved approval of the report of the General Committee on Acceptances, Which is concurred in by the Board's Law Committee, ' and that Counsel be instructed to prepare a formal ruling in accordance therewith. Mr. Platt's motion being put by the Chair was carried, 1.1r. Liner voting "no". The Governor then referred to the meeting of the Federal Advisory e°114cil to be held here on November 19th and stated that no topics have Yet been forwarded to the Council, the matter having been referred to ths Executive Committee on October 28th. Thereupon ensued a discussion (kr; 4.11g which it was pointed out that in accordance with action taken at Its last meeting the Council will consider the question of reserve require- ot3t.p -8- rants of member banks in outlying districts of reserve and central reserve cities; the members of the Council having been requested to review the situation in their respective districts. In this connection Mr. James referred to the varying reserves carried by member banks in greater New York and upon motion by him, it was voted to request Counsel to report to the Board with reference to the reserve requirements of member banks in the different borough.s of New York City, Mr: Miller voting "no". At the suggestion of Mr. Platt, it was voted, that the Council be requested to consider \loather the publication of a consolidated statement of the condition of reporting member banks in the two central reserve cities °11 Saturday, in advance of the pu.blication of the figures for all Districts, Would be of service to bankers and. business men and whether the publication Of the figures for New York and. Chicago in advance of the regular weekly statement released for publication on '2uesdays, would detract from the value °f the latter or tend to distort the picture of the banking situation in the °citialtry as a whole. Mr. Miller then referred to the fact that Mr. Alexander, member of the l'scleral Advisory Council from the 2nd. District has just returned from a triP abroad and suggested that Mr. Alexander be invited to give the Board 44(1 the Council the benefit of his observations during the trip. At the conclusion of the discussion, the Governor was requested to address a letter to the Secretary of the Council transmitting the above suggestions. f% Mr. Miller referred to the discussion at the reeting of the Federal 4(171sory Council in May as to the responsibilities of the Federal Reserve 334. 11/9/26 System thrgugh credits extended to central banks in the matter of stabilizing foreign currencies not yet on an effective gold basis. He suggested that it might be well, in view of the Council's interest in this matter, for the Board informally to advise the members of the Council of the purposes and terms of the Belgian credit approved by the Board on October 5th, and to ask for the views of the Council as to the administrative responsibility of the Board in the matter of credits of this kind. 07,TS OF STA1MNG C01.2.1r2MES: Dated, November 4th, 5th, 6th, 8th, 9th, Dated, November 4th, Dated, November 2nd, Recommending changes in stock at Federal Reserve Banks as set forth in the Auxiliary :iinute Book of this date. Approved. Recommending action on application for admission of state bank, subject to the conditions stated in the individual report attached to the application, as set forth in the Auxiliary Llinute Book of this date. Approved. Recommending approval of the atplication of Mr. J. B. Wagner for permission to serve at the sane time as director of the Stock Yards National Bank of South Omaha, 1-4ebraska and as director and officer of the Union Stock Yards National Bank of Wichita, Kansas. Approved. The meeting adjourned at 11:15 Secretary. APPrOved:
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