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1533 Minutes of actions taken by the Board of Governors of the Federal Reserve System on Thursday, October 31, 1946. PRESENT: Mr. Mr. Mr. Mr. Eccles, Chairman Ransom, Vice Chairman Draper Evans Mr. Mr. Mr. Mr. AS Carpenter, Secretary Sherman, Assistant Secretary Morrill, Special Adviser Thurston, Assistant to the Chairman stated in the minutes of October 30, 1946, Mr. Vardaman we's absent on official business. The minutes of actions taken by the Board of Governors of the Federal Reserve System on October 30, 1946, were approved unani. rnous4 Menorandum dated October 30, 1946, from Mr. Bethea, Director of the Division of Administrative Services, recommending the appointItlent of Miss Helen M. Anderson as a page in that Division, on a tam13°Ilar7 indefinite basis, with basic salary at the rate of 11756.00 Per arirliza, effective as of the date upon which she enters upon the 13e"°rnlarIce of her duties after having passed the usual physical oxThe memorandum also stated that it was contemplated that 443 AliderSOn r'stem. would become a member of the Federal Reserve retirement Approved unanimously. 1534 10/31/46 -2- Telegram to Mr. Fred S. Wallace, Kearney, Nebraska, reading as follows: "Board of Governors of Federal Reserve System has appointed You director of Omaha Branch of Federal Reserve Bank of Kan-7a8 eitY for unexpired portion of term ending December 31, J-946, and telegram."will be pleased to have your acceptance by collect Approved unanimusly. Letter to Mr. DeMoss, Vice President of the Federal Reserve 13(Ink of Dallas, reading as follows: "This refers to your letter of October 10, 1946, addressed to Mr. Leonard, Director of the Board's Division of . Ebcamanations, enclosing a copy of a farm mortgage purchase agreement which has been entered into between State and National banks in your district and the Equitable Life 2ssurance Society of the United States. Under this agreet, the bank agrees to sell, within two years and withml-srecourse, and the Society agrees to purchase farm 8`0)7,gages which have been considered and approved by the 84.cletY before the loans are actually made. It is underthat you would like advice as to whether unlimited 170,n and transfers as contemplated in this agreement ''' be prohibited under standard condition of member941. numbered 3, which prohibits any State member bank ' m__'-'°Ject thereto from engaging as a business in selling ortgages ti Board In prescribing this condition of membership, the had in mind particularly sales of mortgages to the r srairal public who were not in a position to evaluate mor estate loans and might consider the bank at least as .11Y obligated to make good any loss sustained, whereloaLhe Society is qualified to appraise the real estate sl and would not expect the bank to act as guarantor e soundness of the investment. Moreover, it may be question a would -e whether transactions under this agreement of a violate the condition of membership as the contract bankssignment to the Society is entered into before the cumst etuallY makes the farm mortgage loan. In the cir-flees) however, regardless of ;tether sales under n of Zi 1535 10/31/46 -3- "this agreement would be technically inconsistent with the condition of membership, the Board will not object to member State banks making sales of farm mortgage 1-cans to the Equitable Life Assurance Society under this tgreement, as such transactions would not violate the purpose of the condition." Approved unanimously. Letter to Mr. Fulton, Vice President of the Federal Reserve o C leveland, reading as follows: "This refers to your letter of October 10, 1946, Lt Tot: the application of The Peoples Bank, C;:nZorri: for permission to exercise fiduciary Powers. your :/ 1 -1 view of the information submitted, and of rd- le recommendation, the Board of Governors ! 7 13 the Federal Reserve System grant:, , the applicant Ilk Permission, under the provisions of its condition 130w .membership numbered 1, to exercise the fiduciary of .7.r8 now or hereafter authorized under its Articles The ' ncorporation and the laws of the State of Ohio. LP°ard's approval is given subject to acceptance bank 01. - the following standard conditions pre!! .13)ed in connection with the admission to membership 21e banks exercising fiduciary powers: i. Such bank shall not invest funds held by it as fiduciary in stock or obligations of, or property acquired from, the bank or its directors, officers, or employees, or their interests, or in stock or obligations of, or property acquired from, affiliates of the bank. 2. Such bank, except as permitted in the case of national banks exercising fiduciary powers, shall not invest collectively funds held by the bank as fiduciary and shall keep the securities and investments of each trust separate from those of all other trusts and separate 3. from the properties of the bank itself. If funds held by such bank as fiduciary are deposited in its commercial or savings department or otherwise used in the 153“ 1O/31/46 -4— "conduct of its business, it shall deposit with its trust department security in the same manner and to the same extent as is required of national banks exercising fiduciary powers. "Since it is understood that in the State of Ohio, trust funds deposited in the banking department of a bank are preferred claims in event of liquidation of the bank, 5?1,1.are authorized, in accordan ;ce with the general authorion previously granted by the Board, to waive compliance " 1 condition of membership numbered 3 herein until further notice oh. "You are requested to advise The Peoples Bank, Canton, of the Board's action, and to obtain an appropriate rjsolution of the board of directors of the bank accepting conditions listed above and forward a certified copy whereof to the Board." Z Approved unanimously. to Letter to "The First-American Bank & Trust Company", MiddleOhi0, reading as follows: ha "The Board of Governors of the Federal Reserve System f. considered the application for permission to exercise tia;tclary powers made by you on behalf of the First National wg"1,°f Middletown, Middletown, Ohio, the national bank into oh;cu The First -American Bank & Trust Company, Middletown, au3 j , is to be converted, and grants such national bank co "°ritY, effective if and when it is authorized by the whraPtroller of the Currency to commence business, to act, eg;I:Ful.t1,2 in contravention of State or local law, as trustee, administrator, registrar of stocks and bonds, tiara?an of estates, assignee, receiver, or in any other or uclary capacity in which State banks, trust companies nat?ther corporations which come into competition with %a. : lt. 11a1 banks are permitted to act under the laws of the ;Let tol* o Ohio, the exercise of all such rights to be subthe provisions of the Federal Reserve Act and the s gulati°118 of the Board of Governors of the Federal Reerve SYstem, Tru "After the conversion of The First-American Bank & Banistt Company, Middletown, Ohio, into the First National M effective and the Comptroller Of the uue iddletown becomes Currency authorizes the national bank to commence 1537 1O/31/46 —5— "business, you are requested to have the board of directors of the national bank adopt a resolution ratifying application for permission to exercise fiduciary er 3 and a certified copy of the resolution so adopted . /leuld be forwarded to the Federal Reserve Bank of Clevefor transmittal to the Board for its records. When of such resolution has been received by the Board, eopy p .14°rmal certificate covering the national bank's authorivy to exercise trust polhers will be forwarded." gr Approved unanimously. Letter to Mr. DeMoss, Vice President of the Federal Reserve Of Dallas, reading as follows: "In of the recommendation contained in your letter of October 16, 1946, the Board of Governors will tx?tenTe no objection, under the provisions of condiitc'n 0- membership numbered 8 to which the member bank _ ,-subject, to the investment of $1,500 by the Farmers mjcerchants State Bank, Ladonia, Texas, in property adits bank premises, for the purpose of expanding quarters, and the contemplated expenditure of apProxi 4-m-at'eJ-Y " $2,000 for the purpose of improving such t-roperty. Approved unanimously. Secretary. Chairman.
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