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1444 Minutes of actions taken by the Board of Governors of the l'ederal Reserve System on Friday, September 2, 1949. PRESENT: Mr. Szymczak, Chairman pro tem. Mr. Draper Mr. Sherman, Assistant Secretary Telegram to Mr. McCreedy, Vice President of the Federal Reserve t)r Philadelphia, reading as follows: "Retel September 1, Board approves effective September 6, 1949, minimum rate of 1-3/8 percent per annum on Purchases of Government securities under resale agreement as authorized by the Federal Open Market Committee August 5, 1949. Otherwise the Board approves establishment by Your Bank, without change, of rates of discount and purchase in Bank's existing schedule, advice of which was contained in your telegram dated September 1, 1949." Approved unanimously. Telegrams to the Federal Reserve Banks of New York, Atlanta, Chica go, St. Louis, Kansas City, and San Francisco stating that the 443Proves the establishment without change by the Federal Reserve 4,44 Or St. Louis and San Francisco on August 31, and by the Federal eriTA tekber Ilanks of New York, Atlanta, Chicago, and Kansas City on Sep' 1 1949, of the rates or discount and purchase of their exis- t g schedules. Approved unanimously. Memorandum dated August 26, 1949, from Mr. Sherman, Assistant 4el'et 1,17 4 of the Board, recommending that the appointment of William cork 1111-14, a minutes clerk in the Office of the Secretary, be extended 1 9N49 -2- Permanent basis, effective September 2, 1949, with no change lii hi present basic salary at the rate of $3100.20 per annum. Approved unanimously. Letter to Mr. Meyer, Assistant Vice President of the Federal 11141erve Bank of Chicago, reading as follows: "Reference is made to your letter of August 23, 1949, I jcluesting approval of the payment of vacation leave in death of an employee while in the service of of 4. 1e event he Bank , "The Board's letter of August 4, 1938 (5-108) prothat the salary of an officer or employee dying 14hile in the service of a Federal Reserve Bank should be 1/41.d only to and including the day of his death. As incated in that letter, special provision has been made 1,ST the Banks, through the Retirement System, whereby the lleficiaries of an employee dying in active service are tid up to one year's salary, and it would appear to be duPlication to make additional payments for vacation 4-eave, „ "The Board feels that the policy as expressed in letter of August 4, 1938, should not be changed and, .ctflerefore, disapproves the payment for vacation leave in n2 event of the death of an employee while in the service " the Bank." Approved unanimously. r Letter to Mr. Stetzelberger, Vice President of the Federal Ire Bank of Cleveland, reading as follows: in "This refers to your letter of August 17, 1949, relatu 8 to the indirect investment in bank premises by The Ohio,iere hants Trust Company, Massillon, Ohio, through the purchase ' ( ;..additional certificates of equitable ownership in the 111°-Merchants Building. As the proposed investment in bank premises would not ex the amount of the capital stock of the member bank and the is no longer subject to a condition of membership reing the Board's approval of investments in bank premises, the B Ro oard's permission is not necessary in this instance. ever, from the limited facts available, the Board still ha, reservations as to the propriety of investments in ,bank ct 1441; 9/2/49 "these certificates of equitable ownership in the bank building. It is noted that counsel for the bank has expressed the opinion that under the trust instrument the bank may buY these units in its individual capacity, but he does rlot appear to have rendered a general opinion as to the °11t1ngent liability under Ohio law of the bank as trusee in purchasing trust assets. Of course, this is a resPonsibility which rests primarily with the management the bank and it is assumed that proper steps will be taken for the bank's protection." Approved unanimously. Letter to Mr. Young, President of the Federal Reserve Bank or eb! 4.0ago, reading as follows: "The Board has received a letter dated August 29, 1949, from Vice President Harris advising that, in accord?ce with recommendations of the architects and engineers or the Detroit branch building, two changes have been liblaCle in the award of contracts, as originally recommended Y Yeur Directors authorized in the Board's telegram Of August 5, 1949.and It is noted that the elevator contract has been 14101rded tote Otis Elevator Company instead of the 11117411ghton. Elevator Company, and that the contract for the iault door has been awarded to the Diebold Safe Company tillIstead of the Herring-Hall-Marvin Safe Company but that balance of the vault equipment is to be furnished by 'Ile latter company." Approved unanimously. Or lie Letter to Mr. Wiltse, Vice President, Federal Reserve Bank /4 York reading as follows: subml"Reference is made to your letter of August 25, 1949, trev tting the request of the 'Hempstead Bank', Hempstead, to 1.°1‘k, for permission to establish a branch at LevitWI) New York. "It is noted approval of the appropriate State 1447 9/2/49 authorities has been obtained and in view of your recomMendation, the Board of Governors approves the establishInert and operation of a branch in the Village of Levittown, 'ley York, by the 'Hempstead Bank', Hempstead, New York, Provided such branch is established within six months troM the date of this letter. It is understood counsel for the Reserve Bank has reviewed and is satisfied as to the legality of all steps taken to establish the branch." Approved unanimously. Letter to Mr. Sproul, President of the Federal Reserve Bank Of York, reading as follows: "The Board is in receipt of organization papers for establishment of a corporation under section 2)(a) of Federal Reserve Act to be known as 'Bank of America'. way of background for your information, there are encopies of letters dated May 16, and August 12, 1949, 133 .! llk of America National Trust and Savings Association, a copy of a letter to the Federal Reserve Bank of San 'rarleiSCO dated August 30, 1949. The organization papers state that the home office 1, the corporation is to be located at 44 Wall Street, New rk, New York. In the event the Board approves the organisaTc11 of such corporation, Bank of America National Trust 0( ,' Savings Association expects to invest the sum of $2,000,in the capital stock of such corporation thereby subscrib" i 011,g to all of the stock of the corporation; the persons To!anizing such corporation are Russell G. Smith, S. C. Beise, AljB. Coughran, R. P. A. Everard, all officers of Bank of aterica N. T. and S. A., and Kenneth M. Johnson, an attorney . law, San Francisco, California; and in all likelihood th si :corporation will wish to obtain the Board's permist° operate branches in Germany. "Inasmuch as it is proposed that the home office of sUch 14111 'orPoration will be located in New York, the Board 01,1,4- appreciate receiving any comments you may wish to If er concerning the creation of the proposed corporation. 11 care to make any comments in this matter, we hope you 4-4.-L let us have them as soon as practicable." the r
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