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A meeting of the Board of Governors of the Federal Reserve Syswas held in Washington on Monday, October 26, 1942, at 11:30 a.m. PRESEia: Mr. Mr. Mr. Mr. Mr. Eccles, Chairman Ransom, Vice Chairman McKee Draper Evans Mr. Morrill, Secretary Ir. Clayton, Assistant to the Chairman The action stated with respect to each of the matters hereinter referred to was taken by the Board: " The minutes of the meeting of the Board of Governors of the l'ecleral Reserve System held on October 21, 1942, were approved unanimously. The minutes of the meetings of the Board of Governors of the Fedwere approved Reserve System held on October 22, 23, and 24, 1942, 11411 the actions recorded therein were ratified unanimously. Federal Reserve Bank Telegrams to Mr. Paddock, President of the t Boston, Messrs. Hays and Stewart, Secretaries of the Federal Reserve and Mr. Caldwell, Chair131111k8 of Cleveland and St. Louis, respectively, that the Board 111614 °I" the Federal Reserve Bank of Kansas City, stating 27, 1942, the t4°vernors approves for those Banks, effective October per cent l'"es established by the respective boards of directors of 1/2 13 of section 13 °4 "Winces to member banks, under paragraphs 8 and guaranteed obliOr the Federal Reserve Act, secured by direct or fully tions of the United States which have one year or less to run to call per cent on advances to 1"e oto maturity if no call date, and of 2 ,`1,0C-0 1 10/26/42 -2- Ind1v1dua1s, partnerships, or corporations other than banks under the last paragraph of section 13. The telegrams to Messrs. Paddock and Caldwell further stated that the Board approves for the Boston and 41.1sas City Banks, also effective October 27, a rate of 1-1/2 per cant on advances to member banks under section 10(b) of the Federal le8erve Act. The establishment without change of the other rates of aiscount and purchase in the respective Banks' existing schedules wss also approved. Approved unanimously. Federal Reserve Bank Telegram to Mr. Dillard, Secretary of the "Chicago, stating that the Board approves the establishment without cha nge by the Chicago Reserve Bank on October 22, 1942, of the rates or discount and purchase in its existing schedule. Approved unanimously. Federal Reserve Bank Letter to Mr. Hill, Vice President of the Of? iladelphia, reading as follows: in your let"In accordance with the request contained appointment the es approv ter of October 16, 1942, the Board r for the examine ant assist of Carl F. W. Hespenheide as an us of advise Please . elphia Federal Reserve Bank of Philad ive. effect s become ment the date upon which the appoint indebtedness of "It has been noted that the aggregate Mr. Hespenheide is obviously out of proportion to his stated indebtedness is due income, and a substantial portion of the immediate a national bank. Therefore, mless there were of the inProspects of liquidating a substantial portion in the r, whethe debtedness there would be a question as to letter its light of the Board's policy as expressed in should be approved. X-7638 (F.R.L.S. #9180), the appointment It is understood, however, that the applicant's property in that there York, Pennsylvania, has been offered for sale, ated within are good prospects that the sale will be consumm the near future, and that upon its consummation all of his dr. 43rilf!" 10/26/42 -3- "indebtedness to the national bank except ct500 will be paid. Accordingly, the Board's approval of his appointment is given with the understanding that the proposed sale of the property and reduction in indebtedness will be effected as soon as possible. It is assumed, of course, that some definite plan for liquidating the remaining $500 with the national bank will be worked out." Approved unanimously. Letter to the board of directors of "The Citizens State Bank or Petersburg", Petersburg, Indiana, stating that, subject to condi"of membership numbered 1 to tic) 6 contained in the Board's Regula- t11111, the Board approves the bank's application for membership in the Federal Reserve System and for the appropriate amount of stock in the Federal Reserve Bank of St. Louis. The letter also contained the following special comment: "The Board is prescribing the conditions of membership ordinarily prescribed for banks exercising fiduciary powers When they are admitted to membership and it will not object, under condition of membership numbered 1, to your bank reVIMing the exercise of such powers, as is now contemplated. is It is understood, of course, that when such business be and l Undertaken the bank will have qualified personne otherwise equipped to handle it in a proper manner." Approved unanimously, together with a letter to Mr. Davis, President of the Federal Reserve Bank of St. Louis, reading as follows: "The Board of Governors of the Federal Reserve System Bank of approves the application of 'The Citizens State in the ip Petersburg', Petersburg, Indiana, for membersh prescribed ns conditio Federal Reserve System, subject to the to forward to d iu the enclosed letter which you are requeste of copies Two the Board of Directors of the institution. such letter are also enclosed, one of which is for your files and the other of which you are requested to forward to the Director, Department of Financial Institutions for the State of Indiana for his information. 10/26/42 -4- "It is understood that in the State of Indiana trust funds deposited in the banking department of a bank are preferred claims in event of liquidation of the bank. Therefore, you are authorized in accordance with the general authorization previously granted by the Board to waive comPliance with condition of membership numbered 6 until further notice." Letter to Mr. McLarin, President of the Federal Reserve Bank of Atlanta, reading as follows: "This refers to your letter of October 14, and to the request of the South Side Bank of Jacksonville, Florida, a nonmember bank, that it be authorized to maintain the same reserves against deposts as are required to be maintained by banks located outside of central reserve and reserve cities, effective as of the date upon which the bank is converted into and commences business as a national bank under the name 'American National Bank of Jacksonville'. "It is noted from your letter that the subject bank is located in an outlying section of Jacksonville approximately two miles from the main business section of the city; that the section is almost exclusively a residential community with the usual quota of supporting retail establishments; that the Comptroller of the Currency has recognized the community as an outlying district, having approved the bank's application to convert with a capital of $100,000, instead of $200,000 as is ordinarily required of national banks in cities of the size of Jacksonville; that the bank has no interbank deposits and engages in the type of business usually conducted by banks located in and serving primarily outlying communities; and that the Executive Committee of your Bank recommends that the subject bank's request be granted. "In the above circumstances and pursuant to the provisions Of Section 19 of the Federal Reserve Act, the Board grants permission to the 'American National Bank of Jacksonville' to maintain the same reserves against deposits as are required to be maintnined by member banks located outside of central reserve and reserve cities, effective as of the date that the South Side Bank of Jacksonville is converted into the 'American National Bank of Jacksonville' and is authorized by the Comptroller of the Currency to commence business as a national bahk.19 Approved unanimously. 20i0 10/26/42 _5- Letter to the "Temple National Bank", Temple, Texas, reading as follows: "The Board of Governors of the Federal Reserve System has given consideration to your application for fiduciary Powers, and grants you authority to act, when not in contrar, adminvention of State or local law, as trustee, executo estates, of n guardia istrator, registrar of stocks and bonds, or in cs, lunati of s assignee, receiver, committee of estate trust banks, any other fiduciary capacity in which State competition companies or other corporations which come into laws of the under With national banks are permitted to act to be rights such the State of Texas, the exercise of all and Act e Reserv subject to the provisions of the Federal l Rethe Federa of the regulations of the Board of Governors serve System. exercise the fi"This letter will be your authority to preparation the g pendin duciary powers granted by the Board n, which izatio author such Of a formal certificate covering ." course Will be forwarded to you in due Approved unanimously. l Reserve Bank Letter to Mr. Fry, Vice President of the Federa Of chmond, reading as follows: Ri in which "This is in reply to your letter of October 22 ic Electr and Cumberl the from you enclosed a copy of a letter W. tion Regula of 4(e) Company with reference to section correctly that "It appears that the company understands of a radio must price cash a deposit enual to one-third of the ment is deinstru the when be obtained at or before the time ment sale, instal an of livered to a customer in anticipation would exwhich ion regulat and there are no provisions in the ion. cept the company from this provis handicap "The company indicates that section 4 (e) will has in it which ulties diffic Its business because of special , lly, regret natura We oom. salesr making demonstrations at its y compan than this on burden r If section 4(e) places a greate on some other seller. In view of the present situation with seems to us most respect to the supply of radios, however, it demonstrators on t deposi a of unlikely that the requirement as it has supply such selling y from Will prevent the compan available." Approved unanimously. -201;5 10/26/42 -6- Telegram to Mr. Gilmore, Assistant Cashier of the Federal Reserve Bank of St. Louis, reading as follows: "Replying your letter October 17 concerning the application Of new section 4(e) of Regulation W to the delivery of two or three musical instruments of which one is to be selected, the answer is that the customer expects to buy only one instrument, and therefore only one instrument is delivered 'In anticipation' of a sale. Therefore, the customer is required to deposit only an amount equal to the down payment Which would be required on the most expensive of the instruments delivered." Approved unanimously. Bethea, Assistant Memorandum dated October 23, 1942, from Mr. Secretary, recommending (1) that the Board amend its action of February 231 1933, when it authorized the reimbursement of transportation and eUbsistence expenses to Federal Reserve Bank employees assigned to asthe Board's examiners in the conduct of examinations of the Fed-. el'al Reserve Banks on the same basis as the Board's examiners, so as to sPProve an increase in the per diem allowance in lieu of subsistence QuI 4?5.00 to $6.00 per day for such Bank employees, retroactive to ' ri 11"ch 1, 1942, and (2) that the payment of the sum of $16.80, representexcess charges for the use of a special all-pullman train by 16 er4P1oyees loaned by the Boston Reserve Bank to assist in the current se.bnination of the New York Reserve Bank, be approved. Approved unanimously. Thereupon the meeting adjourned. -kAProved: Chairman.
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