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A meeting of the Board of Governors of the Federal Reserve 3Y5tem was held in Washington on Friday, October 27, 1944, at 10:30 PRESENT: Mr. Mr. Mr. Mr. Ransom, Vice Chairman McKee Draper Evans Mr. Mr. Mr. Mr. Morrill, Secretary Bethea, Assistant Secretary Carpenter, Assistant Secretary Clayton, Assistant to the Chairman The action stated with respect to each of the matters hereinafter referred to was taken by the Board: The minutes of the meeting of the Board of Governors of the Federal Reserve System held on October 26, 1944, were approved unaniraousiz• Telegrams to Messrs. Leach and McLarin, Presidents of the l'ederal Reserve Banks of Richmond and Atlanta, respectively, Mr. 1)illarcl) Vice President of the Federal Reserve Bank of Chicago, Mr. Stelvart, S ecretary of the Federal Reserve Bank of St. Louis, Mr. Pc)well, First Vice President of the Federal Reserve Bank of Minne413°1is '14r- Hall, Secretary of the Federal Reserve Bank of Kansas eitY. 'Mr. Gilbert, President of the Federal Reserve Bank of Dallas, anci 141'' Earhart, Vice President of the Federal Reserve Bank of San Co, stating that the Board approves the establishment without bY the Federal Reserve Banks of St. Louis and San Francisco Or l °etober 24, by the Federal Reserve Bank of Atlanta on October 25, 10/27/44 -2and by the Federal Reserve Banks of Richmond, Chicago, Minneapolis, Kansas City, and Dallas on October 26, 1944, of the rates of discount and purchase in their existing schedules. Approved unanimously. Memorandum dated October 26, 1944, from Mr. Morrill submittng +, uue re signation of Mrs. Irene Brown as a charwoman in the Secre_ taryte ^ . uffice, to become effective as of the close of business on Octoh --er 25, 1944, and recommending that the resignation be accepted as of that date. The resignation was accepted as recommended. Letter sent this morning, with the approval of Mr. Ransom and over his signature, to Mr. Creighton, Chairman of the Federal Reserve tank of Boston, reading as follows: sa"This letter is in confirmation of my telephone conver + With you this morning. call "The attention of the Board of Governors has been advertisement inserted in The New York Times lOfe]:W:cdinte4psd:Y, r October 4, 1944, by 'Business Men for Rooseof ' t Inc.' from which it appears that Mr. Dennison, one _a.the directors of your Bank, is a member of the cam12,1gn committee organized by that group. A copy of the cLave rtisement is enclosed. a zorlopt:syou know, in 1915 the Federal Reserve Board resolution, a copy of which is in the files ! be, °11r Bank, to the effect that persons 'acting as memparty committees' could not, consistently spirit and underlying principles of the Federal Re erve Act, serve as directors or officers of the Federal rve Banks. The policy laid down in this resolution rer8,1,:lot been changed since its adoption and the resolution in full force. O 1633 10/27/44 -3was noted that the advertisement was a political advertisem ent, and, since the purpose of the organization is to carry on a campaign for the election of a candidate of a political party, membership in the group by a director of the Federal Reserve Bank would be considered within the 1211rview of the Board's resolution. However, the resolution was not intended in any way to restrict the expression by a director of a Federal Reserve Bank of his political t viewsin his individual capacity. 'As I advised you, the matter had been discussed informally by the members of the Board of Governors, and they felt lt that it would be desirable for you to discuss it With Mr. Dennison informally as it was believed that he did not have the Board's resolution in mind when he became associated with the group. I also said, in re: 12c)nse to Your your inquiry as to what action would be neces: ... trY to the situation, that if Mr. Dennison re-1-gned from the group the matter would be disposed of. "It was understo od that you would communicate with Dennison by telephon e and that after you had talked to him you would call me again." Approved unanimously, together with ?- second letter to Mr. Creighton, which was In the following form: to "The members of the Board of Governors are pleased thilearn from your second telephone conversation with me. m°rning that Mr. Dennison has asked that you mail him a of the resolution adopted by the Board on December Copy23 23, 1915 and has stated that upon its receipt he would ' flair from membership in 'Business Men for Roosevelt, "The Board appreciates very much the helpful and "lective manner in which you have handled this matter." Letters the to "The North Side Bank", Evansville, Indiana, and "40tenai Valley State Bank", Troy, Montana, reading as follows: all "The Board is glad to learn that you have completed Fed arrangements for the admission of your bank to the ti eral Reserve System and takes pleasure in transm..trig herewith a formal certificate of your membership. 10/27/44 -4"It will be appreciated if you will acknowledge receipt of this certificate." Approved unanimously. Letter to the Presidents of all the Federal Reserve Banks readg as follows: "In submitting future reports on Forms F. R. 577 579 please follow the instructions set forth below, nlch take the place of existing instructions (including letters of July 3, 1942 (S-526), October 1, 1942 (S_561), February 9, 1943 (S-617) ) except the letter of June -11 1943 (S-658) with special reference to reporting loans Purchased by the guarantor on Form 579. behal; 1. Guarantee numbers of guarantees executed on of the l'ar Department and the Maritime Commission nould be assi gned by your Bank. The Navy Department will rsantee numbers when issuing authorizations for gusatdtel: "2. A report on Form F. R. 577 should be submitted for „ e7:011 guarantee agreement executed under Regulation V. ' 2TAn.qh of Service chiefly concerned. This item -3 lieedv be filled in only on reports of loans guaranteed by the se ;ar Department and should show the branch of the viee, such as Ordnance, Chemical Warfare, etc., for the has the greatest dollar volume of contracts, foacts If the Bank has difficulty in obtaining such ini,r, it will be obtained for the Bank by the liaison ofTl itl W the 1"4- 22tal_amunI_Qi_laajp_jauthatizad. The amount of that °anshould be reported as the maximum amount of credit under the guarantee agreement may be outstanding at a rlY one time. "1. Separate reports should be submitted for War DePartMent, Navy Department, and Maritime Commission guartees, The report of War Department guarantees should be s ubmitted in triplicate, and the others in quadrupliCate ftReports should show all guarantees in effect uhe Late A of the report, even though no credit is outstand the end of the report month, and also any 10/2744 ,gliarantees terminated or cancelled during the month. vpien separate guarantee agreements are issued to financing institutions participating in a loan, only one entry for all agreements combined need be made on the form. "3. Guarantees should be listed by groups according to type of guarantee, that is, V, VT, 1944V, and T. Within these groups guarantees should be shown numerically on the War Department and Maritime Commission reports, and a lphabetically by name of borrower on the Navy Department report, a except that any purchased loans should 1F)e shown t the end of each group after a subtotal. At the end of each report, a recapitulation of the totals 12r each group (including purchased loans) should be 611c)wn, together with grand totals for all guarantee agreements "4. The figure entered in column 4 should be the "ount of credit in use by the borrower on the report ! ate plus any additional amount then available to boreer under the guarantee agreement, disregarding, In ease of revolving credits, restrictive provisions Such as 411ch those limiting the amount that may be outstand;;i Ile on the loan to a designated percentage of the amount 111°Iry8 due, or to become due, under mar contracts. The amounts to be entered in columns 5 and 8 4o auld be derived by multiplying the amounts in columns • 7 by the guarantee percentage (column 3) currently ln effect. re "6. The amount to be reported in column 9 should resent funds actually advanced to the borrower on the ij an-t.n during the report month and, in the case of a guaran eie_ agreement issued to supersede a cancelled agreement, balance on the loan under the cancelled agreement ,i..knserred to the new agreement. ti, '7• Column 10 should be used to indicate terminass-ns and cancellations of guarantees, adjustments under mj i i°118 5, 6, or other sections of the guarantee agree') and any other pertinent data of interest to the ' arantor.11 Z Approved unanimously, Letter ing to the Presidents of all the Federal Reserve Banks read- as follows: 636 10/27/44 -6- "In submitting future reports on Form F. R. 581 Please follow the instructions set forth below, which take the place of existing instructions (including those contained in our letter 3-536 of July 22, 1942). A supply of Form F. R. 581, revised to cover T loans, was Shipped to your Bank on September 20, 1944. ."Item 4 should represent the number and amount of applications received and acted upon or under considera10fl. All applications for original guarantees and all aPplications for amendments of existing guarantees which r_esult in the issuance of a new guarantee agreement should .L 'e considered as new applications for purposes of reporting on this form. Increases and decreases in amounts of applications made during the period before approval or ,TaPproval thereof should be included in items 2a and , re spectively. If an increase is made after theiint3I-I'l 8Pproval but before a guarantee is issued, indicate e amount of the increase against item 2b. A decrease fl the amount originally applied for after initial action before a guarantee is issued should not be considered al.tering the amount originally applied for, but as a Partial rejection (reported against item 5a(3) or 5b(3) ) a withdrawal (reported against item 5a(2)(a) or 513(ea)( a) ), depending on whether the decrease was made a the instigation of the guarantor or of the applicant. an executed guarantee is cancelled and reissued in an reased or reduced amount, the transaction should be as a new application in the full amount of the Oa, If a similar If change is made through the use of a ,-pplement, the amount of an increase should be reported 1nst item 2b; the amount of a decrease should not be re.e!ted on the form. An application once withdrawn or lie ' c L'ed and later resubmitted should be reported as a sh" aPplication. Applications for revolving credits r reported in the maximum amount that may be ouZ; on the loan at any time. ite Inasmuch as the totals of item 5 must agree -Ath ore 4, applications must be entered in the 'number'columns tljonce even though the amount may be reported against items, for example, applications forguar:ant or more aPproved in part. In such cases the application or-i!cd be entered in the 'number' columns on line 5a(1) 5b(1) if a guarantee is issued; otherwise it J : 74 10/2744 -7— L 8110111d be counted on the line on which the major portion of the loan is reported. "Items 5a(1) and 5b(1) should represent the total number of guarantee agreements executed and the amount Of loans covered by such guarantee agreements. When separate guarantee agreements are issued to a number of banks part icipating in the same loan, they should be counted as one guara ntee for the purpose of this report. "Thounts e am reported under items 5a(2) and 5b(2) ShOUJ.d represent the total of loans on which guarantees have been authorized, with and without conditions, but rnot executed. Applications for guarantees of loans orig11,;11Y reported in the last two columns of items 5a(2)(b) -ct iV,?(2)(b) may be later transferred to 5a(2)(a) or ) upon lapsingof the authorization to guarantee ?r when the status of conditional approval is such as to indicate nonacceptancrby the applicant. _ "Sub-item (3) under 5a and 5b is intended to cover :PPlications rejected and the rejected portion of appliaticT approved in part. 'For each guaranteeing agency the combined report on Form p .581 should be supplemented with subsidiary ports for V, VT, 1944V, and T applications, separately. ti eass submit reports of War and Navy Department applica-kons in duplicate. "No a djustments of the cumulative figures for V and _ 1 loans as of prior reP ars have not September 30 should be made if been submitted in the manner outlined Tli°ve; however, 194411 and T reports should show all apon the basis outlined. Figures on the combined report should equal the slam arr.of the figures on the four subsidiary reports. In forTng at the figures for V loans as of September 30 sum ,. 4 ,..Purpose, it will be satisfactory to deduct the ligures for the VT, 1944V, and T reports from the ante ' ned report. Applications received for V and VT guarbe i:siwhich were granted as 1944 V or T guarantees should ant"el-laded only in the report covering the type of guaree executed." q Approved unanimously. Thereupon the meting adjourned. Secretary.
@FedFRASER