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3260 A. meeting of the Federal Reserve Board was held in :1 lashington "asdalr, October 23, 1934, at 3:00 p. m. PRESENT: Mr. Mx. Mr. Mr. Mx. Thomas, Vice Governor Trinmlin Miller Tames Szymczak Mr. Morrill, Secretary Mx. Goldenweiser, Director of the Division of Research and Statistics Vice Governor Thomas brought to the attention of the other taer4ber8 C)f the Board a circular without date signed by David L. Babc14) -ace President or Babson's Reports, Incorporated, of Babson Park, l'1""hilsett5, headed "Notice to Bank Depositors" which Mr. Thomas had .teeeilieci in the mail this morning. tktee Mx. Thomas said that Governor Young Vederal Reserve Bank of Boston had called him on the long dis.e 40.1 phone before Mr. Thomas had seen the notice, and that Gayer- 401, youn t4t seemed to be somewhat disturbed about the circular and thought consideration should be given to it by the hoard. In this e°411eetioa, 1,1r. Thomas said that he understood that Governor Young Woku.d. be Washington tomorrow and it was wreed that further discus- '1°4 the t't the circular should be deferred until Governor Young's visit -°se of ascertainin,:, , what Governor Young had in mind as to the eie tio4, lf any, that the Board might take regarding it. (SECRETARY'S NOTE: The circular referred to is 14 the files of the Federal Reserve hoard.) :tt tilts point Mr. Goldenweiser left the meeting. atoll Reference was made to the discussion during the executive ses- 01 'ths Board on yesterday of the retention on the hoard's payrolls 3261 -22-bin, Assistant to the Governor, and hiss Gladys ecretary to Er. Eartin. ,,fter discussion, the assinment of 'Jr. Martin to duty at Atlanta, Georgia, to assist Governor Black in his work in a liaison capacity between the Administration and the banks of the country (as described in Governor Black's statement recorded in the minutes of June 25, 1934, and in the President's letter of -lignst 15, 1934, to Governor Black recorded in the minutes of that date) was approved, together with the assigniamt of Miss 'Jelch to duty at Atlanta as Secretary to Er. - artin, and it was decided that they should be continued on the payrolls of the Board, for the time being until its further order, without change of designation or rate of compensation. The Board's Secretary was authorized to inform Governor Black and Er. Martin accordingly. The Board then considered and acted ul)on the followinc; natters: toI, , Lemozandum dated October 18, 1934, from hr. Goldenweiser, Direc- -Ghe Division of Research and Statistic s, recommending the extenPOiiOd of three months from October 26, 1934, of the tempo4,17 el)1°: 72°11% ' Lois A. Crim as a stenographer in the division, With z at her present rate of 31,440 per annum. Approved. tlie 4144:4 14 the .I' ' ' e loranduni. dated October 19, 1934, from 1,:r. SLead, Chief of °f - Operations, submittin and reconnendin6 no ac- Qf the resignation of Mrs. Libbie L. Hitt as a stenographer (11:11isi°11, effective as of the close of business on October 18, Approved. Lettel' dated October 22, 1934, approved by five :::erers of 3262 10/23/34 -3t4Bard, to Governor Harrison of the Federal Reserve Bank of Eew readin- as follows: "Rsference is made to your letter of October 10, 1934 advisip4s of the arran6ement approved by your directors under which Mr. John H. llliams, economist of iclur bank, will conduct courses in economics at the vard Graduate School during the first semester of une academic year, and will cive at least two Cays a 17eek of his time to the Federal Reserve Bank of New his salary, during his :,art time employment, inlnuin0 October 1, 193‘1 to be one-third of Lis regu'a-c salary at your bank, or at the rate of ' .7,333.33 Per aanum. Ine "The Federal Reserve Board approves the adjustOf Mr. Williams' salary in accordance with the 1011 taken by your directors." ApIroved. IleMorandum dated October 20, 19(64, from Mr. Snead, Chief "he Division of' Bank Operations, submittins a draft of a letter 10 the Pederal reserve agents at all Federal reserve banks transta ittit the blank forms to be used by State member banks and their qtilie.tes tall renderin,S reports as of the next call date, and statin ehanzeo in the form of the report have been approved by the . ' (11 cl) and that the Comptroller of the Currency has made similar 441.4eez in the report form to be used by national banks. The draft (1r 'letter liaa a-Joroved. by three members of the Board on October 22, 21pproved. or Tele gram dated October 22, 1 934, approved by five members the toa t° la% iounds, Deputy Governor of the Federal Reserve 7 York, readin as follows: .11 ilake ir)) t3 t 10/z3/34 -4- "Betel October 18. Board understands applications have teen presented wherein two or more commercial banks desire to partici-rmte in providing workins capital for Industrial or commercial business, each bank to obliate itself to satisfaction of Federal reserve bank for lts 'rJ20 rata part of at least 20 per centum of any loss :3-oh may be sustained by such Federal reserve bank Ilimn obligations of industrial or commercial business a c'.ttlired from such commercial banks. For example, in case of ec,u, 1 participation by banks ,A and B, it is 1111ael'stood that industrial 02 connercial business will Iglake iflle application but will e:ecute two separate -ates, each eeual in amount to one-half of total ex!ension of credit and payable to banks A and B, res-oecrvelY, and that Federal reserve bank will discount Or Purchase one of such notes from bank Aand other ro bank 2fin B, each commercial bank obligating itself ,t() e‘t least per centum of loss which may be susfalfled by Federal reserve bank uoon oblip;ation acquired az such commercial bank. In such circumstances Board i) rees with views of your counsel that Federal reserve 111,-,Y lawfully discount or Purchase obligations if aer ii ecuirements cyf law are saLisfied." J 2pproved. -2elerara dated October tkie 19, approved by five :„.effocrs of ell: to the Federal reserve atLents at all 7ederal reserve ba,:ks, aa follows: .2ede,"ulins no. 30 interpreting Regulation .22. The Reserve Board has been asked whether under Regu" , 11°11 T, a broker may remit a customer to ':ithdraw zo''" (-'iviciends or interest received by the broker on car-ied for the customer in a restricted 1)11'! accou_nt. In re-nly the Board advises -Jhat for the s of Agulation T such withdrawal of interest idends is to be considered as not different from er withdrawal of cash and therefore may not be bed. in such account except in camliance with tile 1?I'oviulons of section 4(d) of the Regulation.' Z Approved. to the Federal reserve agents at all F - ederal reserve b4rika l'eadinc as folla„s: aloe Awt.rit 10/23/34 'Ruling No. 31 interpreting Regulation T. The Federal Reserve 3oard has been asked whether a certain individual's proportionate share of the excess loan value in a joint account carried for such individual and certain other persons jointly may be combined with the individual's personal account carried simultaneous1Y with the same broker in order that such personal aecclInt may be considered as an unrestricted rather than !I, restricted account under 2egu1ation T. In reply the tcard points out that the individual in cuestion is a customer' within the meanin,:; of the definition in section 2(m) of the regulation and that the Parties to !I?e joint account as a group constitute a separate and ”stinct 'customer' within the meaninr- of such defini' 10n and accordingly advised that the individual's perz;onal account may not be considored an unrestricted Iccount because of the presence of excess loan value the joint account unless the parties to the joint eount actin : jointly have, in writing, guaranteed 2.Le individual's personal account for an amount suffiuient to make it an unrestricted account." j Approved. Telegram to the Federal reserve agents at all Iederal reserve reading as follows: 1,ede , , 11111inZ No. 32 interpreting Regulation T. The A la-L lleserve Board has been asked wLether, if a cnfirmation of a transaction has been sent by nail tri° a customer at his last aioun address, a demand for ,,41'eirt which appeared not on a seoarate piece of 1)sr but on the confi-rmation itself may be considered 1,av1ns been made in the manner specified in clause section 3(f) of Regulation T so that the amount EIA .Irgin demanded may be deducted in cozTutimg the I;IqUeted debit balance of the customer's account. conl ' clDlY the Board advises that such a demand nay be raj sidered as u demand made in a 'letter' within the tiotlla( of clause 8 and that accordingly the L:ues' 4 should be answered in the affimative." Z 2 0 Approved. '11.1 —4.egrail to Stevens, Federal Reserve :;..ent at the Fedlieserir auk of Chicago, reading as follows: :3265 r) -6"Referring to your letter of October 17 and ouestion sUbitted by the Chicago Stock Exchange in letter to you dated October 16. Ruling No. 11 interpreting Regulation T does not enlarge meaning of term 'net withdrawal' as (ierined in Regulation T so as to make it necessary in ascertaining existence of 'net withdrawal' to include Illarket value of unregistered non -exempted securities !ithdrawn from a restricted new account. Ruling No. 11 u?alt with old accounts and in particular with third proOf section 7(a) of regulation which specifies conUnder which creditor may permit customer to withmoney and/or securities and does not mention or inv0 've 'net withdrawal' as defined in the regulation." Ap-,)roved. se Letter to LT. lioxton, 7ederal Reserve agent at the 2ederal ne1.`7e of iiiehxdond, reading as 2:01101.VS "Reference is made to your letter of October 5, concerning the Clayton ct application of r. so ° , , 17alicl Bruce, Baltimore, Maryland, for permission to iin- T_!° as director and officer of the Baltimore l°4s1 Bank, as director of The Equitable Trust ,ZarlY, and director of the Safe Deposit and a CI°DenY of Baltimore, all of Baltimore, ITary- 112.! eat. "The Board has reconsidered Mr. Bruce's appliit,111 und u'aon the basis of the information before let,'Ileluding that submitted by the applicant in his oc,4er dated October 4, 1937., and the letter dated L ber 3) 194, sub:iitted in his behalf by e Prance, still feels that the granting of the v/ith respect to the Baltimore National Bank /)4.tille Equitable Trust Company would be incamth the public interest for the reasons jorth in the Board's letter to you, dated _,ugust '4-94. aee J.ou are requested to advise,the applicant ordinly. illtil"Please ascertain and advise the Board what tO coel ' steps 1,1r. 3ruce pr000ses to take in order -11)1Y with the :,rovisions of the Clayton Approved. Letter to 3tevens, Federal Reserve agent at the Federal '2441: °11 C'AcaCo, readin as follows: 3266 10/23/34 "Reference is mrde to Assistant Federal Reserve Agent 1.°113ag'5 letter of October 2, 1934, with which were transmitted copies of letters from Er. George L. Bailey, president Of The Home State Bank, Royal, Iowa, to Governor Schaller, dated September 29, 1934, and from nr. E. C. Bertram, Peterson, ,,?was -L0 Er. Young, dated September 27, 1964, in connection li-t.th the application of Mr. E. C. Bertram for pemission under Provisions of the Clayton Act to serve at the same time as ''lrector and officer of The First National Bank of Peterson, Peterson, Iowa, and as director of The Home State Bank, Royal, Iowa. "In the Board's letter of July 21, 1934, you were informed ' 4 41t, in its opinion, the issuance of a permit to the applicant 0 serve these banks would be incompatible with the public i, l;tereet in view of the several unsatisfactory factors set forth Your report on this case and requested to advise Er. Bertram 1,r't, in accordance with Section v (g) of Regulation L, consideraiOXl be given to any additional facts or arguments not apsil ag in his application and accompanying forms which he felt cf,-14(1 be brought to the Board's attention. The Board has given 1:12aderation to the additional facts and arguments submitted with .. . °Ung t s letter of October 2, 1934, and still concurs in the 1;;;44°11 of your office that the granting of the permit applied vi- Would be incompatible with the public interest. Please adthe applicant of the Board's position in the matter. tio "It has been noted that Bertram has tendered his resignair 4 a3 a director of The Home State Bank and it will be appreciated You will advise the Board when his resignation has been acin or that its file in this case may be closed." 1 Approved. Letters dated October 22, 1934, approved by five members of the 13(ktcl) to the respective Federal reserve agents, inclosing the followt0.141/rtort Act pernits; suggesting in each case that the agent inform , t4 41/Plieant that it is with the expectation that he will satisfactorily (Itterid , directors' meetings that the permit has been granted; and request14:1414t) When the agent sublAts his recommendation as a result of his t -1141 l'e/lew ef the penait, he report fully as to the applicant's at144 414 ee at d : irectors' meetings and as to the manner in which he has 1118ed his duties as a director: 3267 10/23/34 -8F. L. Carson, for permission to serve at the some time as !.director and officer of the First National Bank in Wichita, Kansas, and as a director and officer of The First ati°11a1 Bank of Spearman, Spearman, Texas. ! II's C. X. Chandler, for permission to serve at the same time a.director and officer of the First National Brink in Wichita, ;,V,Ilte, Kansas, as a director of The First National Bank of 01 ; 4-LY, Holly, Colorado, and as a director and officer of The allcller National Bank of Lyons, Lyons, Kansas. 14rs as a71*.W. Chandler, for permission to serve at the same time liouirdirector and officer of The First National Bank of Holly, , J) Colorado, as a director and officer of The Chandler „ 104a1 Bank of Lyons, Lyons, Kansas, and as a director of The First National Bank of iakhart, Elkhart, Kansas. 4/.. A n L. Wood, for permission to serve at the same time as irector and officer of the First National Bank in Wichita, hita Kansas, as a director and officer of The First National 0-i'mA or akhart, Elkhart, Kansas, and as a director and eficer The Perryton National Bank, Perryton, Texas. 14're Els a nee W. Berryman, lor permission to serve at the same time uirector of The Stockgrowers State Bank, Ashland, Kansas, as an ofricer of The First National Bank of Spearman, SpearTexas vi-f Approved. Letters dated October 22, 1934, approved by five members of the 4 . t Drovea. aPPlieants for permits under the Clayton Act, advising of ap- r their applications as follows: kt. 48 4 „17* Berryman, for permission to serve at the same time 144 y-Lrector and officer of The Stockgrowers State Bank, Ash.Kansas, as a director and officer of the 'First National IleTecal Wichita, Wichita, Kansas, and as a director of The allts National Bank of Topeka, Topeka, Kansas. as ,,q• Chandler, for permission to serve at the some time 'ctiouv-krector and officer of the First National Dank in Wichita, 1:aneas, and as a director and officer of The Chandler of Lyons, Lyons, Kansas. clirectL'14 Evans, for permission to serve at the same time as a °f the Arst National Bank in Wichita, Wichita, Kansas, Xsti, - a director of %Jas. The Chandler National Bank of Lyons, Lyons, 3268 10/23/3E1 -9- Xohn T. Stewart, for permission to serve at the same time as a director and officer of The First National Bank of Y,edford) Medford, Oklahoma, as a uirector and officer of the Caldwell State Bank, Caldwell, Kansas, and as a director of the First National Bank in Wichita, Wichita, Kansas. Ur L. B. Campbell, for permission to serve at the same time as a airector and officer of The First National Bank of Spear4an, Spearman, Texas, and as a director of The Perryton National Ba lc, Perryton, Texas. Approved. Letters to applicants for permits under the Clayton Act, advisor aPproval of their applications as follows: , 15z:. Denton Gehr, for permission to serve at the same time as a Irector and officer of The First National Bank of Westminster, Jes tminster, Maryland, and as a director of The Carroll County Savings Bank, Uniontown, Maryland. Xacob X. Weaver, Tr., for permission to serve at the same ,7-"T as a director of The First National Bank of Westminster, ceaLrainster, Maryland, and as a director and officer of The arr°11 County Savings Bank, Uniontown, Maryland. 1.1r, n Eugene Walsh, for permission to serve at the same time 07 . a director of The First National Bank of Westminster, 7iestrr, ? 1 ter, Laryland, and as a director of the Manchester Bank, chester, Maryland. Approved. There were then presented the following applications for changes -- of Federal reserve banks: 4 14_ i„-ation for 11" riet 2 ORIGINa Stock: hrat . -et National : Bank in J ort Lee, 11 Lee) New Jersey A Shares 72 72 ications for L.DDITIONAL Stock: Zikle Z ille Trust Company, S-44rvi4e, Massachusetts 135 ' 135 111 10/23/4 •• lications for LDDITIOl\TAL Stock: Continued) District No. 2 /141°11 Trust Company of aidicott, Ittldicott, New York 411811 City Bank and Trust Company: 14Garden Batik City, New York o liararnondsport, rilli-uustrondsport, New York `46 Citizens Bank of Locke, litl4c1ce: New York 34411 111County Trust company: LibLir,'1: New York --J-Q-Alliance Bank and Trust Company: ocheeter, New York '41 or westbury Trust Company: ,featbuz7: New York biatrict NO. 8' B. Worthen Llttle Company) ,Roelc, °°111 Bank and Arkansas any, Trust Comp ,QUisirille, Kentucky State Bank, tate t iarazira: artic Illinois or Roes u (Ec 4reerwi ile , Illinoissons, le —0Ds Bank of Indianola: 1,144lanola, LlississiPPi 7lles 146°1-„I Bank & Trust Co.: Liissouri --lazay State i3ank: Lassouri 4Jagett Barilc, Iltek Stri a4 _c)111s, 1,I1s3ouri and 4,;.. Louis, Trust Co. -4°4••Taylor •.14 't• . 14sriouri Trust Coman pY) 4401113, laissouri 81.8°11 & Trust (It"' Company: Llissouri 11d- *80/1-Grav0is Bank of 3t. 4.i.el; Louis, , '1. souri '-ertist 1131zia: ooxpany, tlissouri : -1a411111:31 7alley Trust company : 44341a: 4 C,Z/ las3ouri It J00.4e L Trust oUia, CcalPanY, lassouri 4.r_rtIre Bank and i'rust Idi souri qtah • C°114tY -111e)t°11: Liissouri Shares 3270 1°/23/34 -11Stock: (Continued) ................14.1.LLD4tatir4iet The Firs nal Bank of 'Grand Rapids, "Grarld Rapids, ::.:innesota le Yellowstone Bank of Laurel, 411rel, Lontana Shares 15 Total 4134131icetions for SURRENDER of stock: „'8triet No. 3. strausstown Na.tional Bank, S trausst ovm, Pennsylvania -441,..,81116 liational Bank, 44/218111g) Michigan 18 1,668 30 30 30 Total 60 10 Approved. Thereupon the raeeting adjourned. o-\--IL S/ge-Pj7 ci1ietary. .-P 4PZQveci: Vice Governor.
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