Full text of Minutes of the Board of Governors of the Federal Reserve System : Meeting Minutes, September 28, 1964, Volume 51, Part 9

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Minutes for agxtember 28, 1964

To:

Members of the Board

From:

Office of the Secretary

Attached is a copy of the minutes of the
Board of Governors of the Federal Reserve System on
the above date.
It is not proposed to include a statement
with respect to any of the entries in this set of
minutes in the record of policy actions required to
be maintained pursuant to section 10 of the Federal
Reserve Act.
Should you have any question with regard to
the minutes, it will be appreciated if you will advise
the Secretary's Office. Otherwise, please initial
below. If you were present at the meeting, your
initials will indicate approval of the minutes. If
you were not present, your initials will indicate
only that you have seen the minutes.

Chm. Martin
Gov. Mills
Gov. Robertson
Gov. Balderston
Gov. Shepardson
Gov. Mitchell
Gov. Daane

0
Minutes of the Board of Governors of the Federal Reserve System
on Monday, September 28, 1964.

The Board met in the Board Room at

10:00 a.m.
PRESENT:

Mr.
Mr.
Mr.
Mr.

Martin, Chairman
Robertson
Mitchell
Daane
Mr. Sherman, Secretary
Mr. Broida, Assistant Secretary
Mr. Young, Adviser to the Board and Director,
Division of International Finance
Mr. Noyes, Adviser to the Board
Mr. Fauver, Assistant to the Board
Mr. Spencer, General Assistant, Office of the
Secretary
Messrs. Brill, Holland, Koch, Garfield, Partee,
Axilrod, Eckert, Freedman, Gehman, Keir,
Osborne, Weiner, and Wernick of the Division
of Research and Statistics
Messrs. Hersey, Sammons, Irvine, Katz, Reynolds,
Wood, Dahl, Gekker, Hayes, and Maroni of the
Division of International Finance

Economic review.

The Division of the International Finance

Presented a review of international financial developments, following
%/Itch the Division of Research and Statistics summarized business and
financial conditions.
Following discussion based on the foregoing review, all members

c't the staff except Messrs. Sherman, Young, Noyes, Fauver, Brill, Partee,
41*4 Spencer withdrew from the meeting and the following entered the room:
Mr.
Mr.
Mr.
Mr.
Mr.

Cardon, Legislative Counsel
Hackley, General Counsel
Solomon, Director, Division of Examinations
Conkling, Assistant Director, Division of Bank Operations
Leavitt, Assistant Director, Division of Examinations

3311
9/28/64

-2Mr. Langham, Assistant Director, Division of Data Processing
Mx. Young, Senior Attorney, Legal Division
Mr. Egertson, Supervisory Review Examiner, Division of Examinations
Mr. Veenstra, Chief, Financial Statistics Section, Division
of Data Processing
Circulated items.

The following items, copies of which are

attached to these minutes under the respective item numbers indicated,
were approved unanimously:
Item No.
Letter to First Trust & Deposit Company, Syracuse,
New York, approving the establishment of a branch
14 the Camillus Plaza Shopping Center, Town of
Camillus.

.Letter to The Marine Trust Company of Western New York,
BUffalo, New York, approving the establishment of a
branch at 1786 Sheridan Drive, Town of Tonawanda.

Letter to The Marine Trust Company of Western New York,
,1!'llfralo, New York, approving the establishment of a
°ranch at 57 South Buffalo Street, Village of Hamburg.

Letter to Camden Trust Company, Camden, New Jersey,
8.Pproving the establishment of a branch at White
liorse Pike and Oak Avenue, Lindenwold.

Letter to Bank of the Commonwealth, Detroit, Michigan,
414Draving the establishment of a branch at 2510-18-24
Market Street.

Letter to the Federal Reserve Bank of New York approving

the Bank acting as fiscal agent with respect to a

)
,I'oposed issue of bonds by the International Bank for
1Lle
and Development.
construction

Report on competitive factors (Sacramento-Davis, California).

there had been distributed a draft of report to the Federal Deposit
Insurance Corporation on the competitive factors involved in the proposed

9/28/64

-3-

merger of Bank of Sacramento, Sacramento, California, with Bank of Davis,
Davis, California.
The report, in which the conclusion read as follows, was approved
Unanimously for transmittal to the Corporation:
Due principally to the geographic barrier and
numerous intervening offices of competing banks between
the Bank of Sacramento and Bank of Davis, there is no
evidence of competition existing between the two banks.
Consummation of the proposed merger would not have
adverse competitive effects on any bank in the area.
Call report (Items

and

8).

There had been distributed a memo-

randum dated September 24, 1964, from the Division of Data Processing
vith regard to forms to be used by State member banks and their affiliates

submitting reports as of the next call date.

Attached to the memo-

randum was a draft of letter to the Federal Reserve Banks transmitting
(4) fall call report forms, and (b) a proposed supplementary schedule
tO1' the
purpose of collecting information on time certificates of deposit
issued to certain classifications of depositors.

Also attached to the

Memorandum was a draft of letter to the Comptroller of the Currency
informing him of the Board's plan to use the supplementary schedule.
The memorandum stated that the condition report form was to be
in abbreviated format.

The Federal Deposit Insurance Corporation would

also use the short call format, which was similar to the one used by
both agencies for the April 15, 1964, call date.

the

It was understood that

Comptroller of the Currency planned to use a report form identical

to that used for national banks at the April 15 call date, which report

gr,

16.1-1

9/28/64

-4-

Inta incompatible with the State forms.

No reconciliation slip-sheet

.4118 proposed for the fall call, and present plans assumed that no tabulation would be made of the reports of condition in view of the fundamental incompatibility of State and national bank forms and the minimal
value and high cost of the abbreviated statistical output.
Mr. Veenstra reviewed the information presented in the memorandum
Of September 24, noting that the proposed supplementary schedule for
collecting information on time certificates of deposit had been initiated
by the Federal Deposit Insurance Corporation.

Negotiations between the

Board and Corporation staff that involved the Examinations and Research
tivisions at both agencies as well as the Division of Data Processing
had resulted in the form that had been prepared.
Mr. Solomon stated that in suggesting the use of the schedule
for collecting information on time certificates of deposit, the FDIC
lePresentatives were primarily concerned with gathering such information
'
to determine the extent of issuance of such certificates to savings and
lOan associations.

In response to a question raised by Governor Daane,

1411. Solomon said that he felt the information to be obtained through use
Of the supplementary schedule would be of sufficient value to justify the
aaditional reporting that would be required of State member banks.
After minor changes in language were agreed upon, the letter
to the Reserve Banks was approved unanimously in the form of attached
Item No. 7.

A copy of the letter sent to the Comptroller of the Currency

/11-th regard to the supplementary schedule is attached as Item No. 8.

4,4z-.1 fit

9/28/64

-5Messrs. Partee and Young (Legal Division) then withdrew from

the meeting.
Request for information on compensation of bank officers.

There

had been distributed a memorandum dated September 24, 1964, from Mr.
Langham discussing a request by Professor Donald Jacobs of the staff
of the House Banking and Currency Committee for certain detailed tabulations of data relating to compensation of bank officers, for use in
connection with the Committee's study of management succession.
In August 1963 the Board agreed, in response to a request from
Chairman Patman of the House Banking and Currency Committee, to furnish
information on the compensation of officers of State member banks as
l'ePorted on bank examination reports.

The Comptroller of the Currency

and the Federal Deposit Insurance Corporation, pursuant to a request
rrom Chairman Patman, also agreed to furnish similar information relating
to national and insured nonmember banks, respectively.

The Board would

tabulate the data for the three groups of banks in such form as would
Obviate any possibility of disclosure or identification of the information
ror any individual bank, in accordance with classifications agreed on
by the
staff of the Committee and the Board.
The memorandum of September 24 stated that all requested tabuexcept those Pertaining to compensation data, had been completed
and delivered to Professor Jacobs.

However, Professor Jacobs felt that

131°1'e detailed tabulations of compensation data than originally contemplated

k
t).0 _1 al

-6-

9/28/64

were essential for the completion of the study.

He had indicated that,

unless additional information as described in the memorandum of September 24
Vas

made available, he would not be able to complete the study.
Mr. Langham said that these latest specifications went far beyond

the general form that the staff had worked out with previous members of
the Committee staff at the time Chairman Patman's request was submitted
to the Board for consideration.

However, an arrangement had been devised

that should permit the running of the detailed tabulations requested by
?rofessor Jacobs, while still insuring the confidentiality of individual
bank figures.

The service bureau performing the work had agreed to include

such salary tabulations in its existing $15,500 contract for programming
and processing data reported in the management succession survey.

Accord-

Mr. Langham said that he would recommend that the compensation
data be furnished to Professor Jacobs as requested, provided the Comptroller of the Currency and the Federal Deposit Insurance Corporation
were agreeable to the inclusion of data for national and insured nonmember
banks.

The Division of Research and Statistics and the Division of

4aminations concurred in the recommendation.
In response to a question, Mr. Langham said that under the
Ilrrangement contemplated, data for individual banks would not be dise1c3sed; thus, there would not be a violation of any confidential aspects
such information.
In the discussion that followed, question was raised whether it
/gas necessary for the Board to consult the Comptroller of the Currency

1-1

9/25/64

-7-

and the Federal Deposit Insurance Corporation to ascertain if those
agencies would be agreeable to including the pertinent data for national
and insured nonmember banks, since they had previously agreed to record
officer salary information from reports of examination for banks included
in the management succession survey.
After discussion, there was agreement that the earlier authorization
could serve as the basis for proceeding with the proposed tabulations.
Accordingly, it was understood that tabulation of the data would be
handled in the manner recommended in Mr. Langham's memorandum of September 24 and that the information requested by Professor Jacobs would
be furnished.
The meeting then adjourned.
Secretary's Note: A letter was sent today
to First National City Bank, New York, New
York, acknowledging receipt of notice of its
intent to establish an additional branch in
Argentina, to be located in the Villa Crespo
section of Buenos Aires.

BOARD OF GOVERNORS

Item No. 1
9/28/64

OF THE

FEDERAL RESERVE SYSTEM
WASHINGTON, D. C. 20551
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD

September 28, 1964.

Board of Directors,
First Trust & Deposit Company,
Syracuse, New York.
Gentlemen:
The Board of Governors of the Federal Reserve
System approves the establishment by First Trust &
Deposit Company, Syracuse, New York, of a branch in the
Camillus Plaza Shopping Center, 5300 West Genesee Street,
Town of Camillus, Onondaga County, New York, provided
the branch is established within one year from the date
of this letter.
Very truly yours,
(Signed) Karl E. Bakke
Karl E. Bakke,
Assistant Secretary.
(The letter to the Reserve Bank stated that the
Board also had approved a six-month extension
of the period allowed to establish the branch;
and that if an extension should be requested,
the procedure prescribed in the Board's letter
of November 9, 1962 (S-1846), should be followed.)

BOARD OF GOVERNORS

Item No. 2
9/28/64

OF THE

FEDERAL RESERVE SYSTEM
WASHINGTON, D. C. 20551
ADDRICSIII OFFICIAL CORREBI.ONDIENCK
TO THE BOARD

September 28, 1964.

(Signed) Karl E. Bakke
Karl E. Bakke,
Assistant Secretary.
that the
(The letter to the Reserve Bank stated
extension
Board also had approved a six-month
branch;
of the period allowed to establish the
requested,
and that if an extension should be
letter
Board's
the
in
prescribed
the procedure
followed.)
be
should
(5-1846),
1962
of November 9,

1-3 -Li
Item No: )
9/28/64

BOARD OF GOVERNORS
OF THE

FEDERAL RESERVE SYSTEM
WASHINGTON, D. C. 20551
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD

September 28, 1964.

Board of Directors,
The Marine Trust Company of
Western New York,
Buffalo, New York.
Gentlemen:
The Board of Governors of the Federal Reserve
System approves the establishment by The Marine Trust
Company of Western New York, Buffalo, New York, of a
branch at 57 South Buffalo Street, Village of Hamburg,
Erie County, New York, provided the branch is established
within one year from the date of this letter.
Very truly yours,
(signed) Karl E. Bakke
Karl E. Bakke,
Assistant Secretary.
(The letter to the Reserve Bank stated that the
Board also had approved a six-month extension
of the period allowed to establish the branch;
and that if an extension should be requested,
the procedure prescribed in the Board's letter
of November 9, 1962 (S-1846), should be followed.)

347320
BOARD OF GOVERNORS
'QFc(j.

Item No.

9/28/64

OF THE

FEDERAL RESERVE SYSTEM
WASHINGTON, D. C. 20551

L.J•

ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
.•••••

September 28, 1964.

Board of Directors,
Camden Trust Company,
Camden, New Jersey.
Gentlemen:
The Board of Governors of the Federal
Reserve System approves the establishment by
Camden Trust Company, Camden, New Jersey, of a
branch at the northeast corner of the intersection
of White Horse Pike and Oak Avenue, Lindenwold,
Camden County, New Jersey, provided the branch
is established within one year from the date of
this letter.
Very truly yours,
(Signed) Karl E. Bakke
Karl E. Bakke,
'Assistant Secretary.
(The letter to the Reserve Bank stated that the
Board also had approved a six-month extension
of the period allowed to establish the branch;
and that if an extension should be requested,
the procedure prescribed in the Board's letter
of November 9, 1962 (S-1846), should be followed.)

BOARD OF GOVERNORS

Item No.

9/28/64

OF THE

FEDERAL RESERVE SYSTEM
WASHINGTON 25. O. C.
ADDRESS OPPICIAL. CORRESPONDENCE
TO THE 'BOARD

September 28, 1964.

• Board of Directors,
Bank of the Commonwealth,
Detroit, Michigan.
Gentlemen:
The Board of Governors of the Federal
a
Reserve System approves the establishment of
18at
2510th
nweal
Commo
branch by Bank of the
24 Market Street, Detroit, Michigan, provided
the branch is established within six months from
the date of this letter.
Very truly yours,
(Signed) Karl E. Bakke

Karl E. Bakke,
Assistant Secretary.
stated that the
(The letter to the Reserve Bank
extension
onth
six-m
a
ved
Board also had appro
the
branch;
lish
estab
of the period allowed to
sted,
be
d
reque
shoul
and that if an extension
r
lette
's
Board
the
in
the procedure prescribed
wed.)
follo
be
d
shoul
46),
of November 9, 1962 (S-18

Item No. 6

BOARD OF GOVERNORS
...""..
,•(,,ollY Col.,: •
.•
4 4'i
---`,
'-''',
'
'0'7-'

9/28/64

OF THE

FEDERAL RESERVE SYSTEM

:C
rIfit.
.1.

s7;.:
La4
,--.
h.

WASHINGTON, 0. C. 20551
ADDRESS OFFICIAL CORRESPCINDENCE
TO THE BOARD

Ri-_;‘..\''. •.
•....•

' AL

September 28, 1964.

Mr. H. A. Bilby, Vice President,
Federal Reserve Bank of New York,
New York, New York. 10045
Dear Mr. Bilby:
This refers to your letter of September 15, 1964, and
enclosures, concerning the proposed issue by the International Bank
for Reconstruction and Development of $100 million aggregate principal
amount of its Two Year Bonds of 1964, due October 1, 1966. In that
letter you state that it is proposed to amend Schedule A of the Fiscal
Agency Agreement, dated as of February 6, 1950, between the
International Bank and your Bank to include the bonds in question.
The Board of Governors approves of your Bank acting as
Fiscal Agent in respect of the proposed issue by the International
Bank of its Two Year Bonds of 1964, due October 1, 1966, and approves
the execution and delivery by your Bank of an Agreement with the
International Bank in the form of the draft of Supplement No. 24 to
the Fiscal Agency Agreement, dated as of February 6, 1950, between
Your Bank and the International Bank, enclosed with your letter.
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.

t_.13.41-

BOARD OF GOVERNORS
tt4t*
$ **44

Item No.

OF THE

9/28/64

FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
ADDRCIIIS

44***

OFFICIAL

CORRIESPONOZNOC
TO TNIC BOARD

September 29, 1964.

Dear Sir:
The indicated number of copies of the following forms are
being forwarded to your Bank under separate cover for use of State
member banks and their affiliates in submitting reports as of the
next call date. A copy of each form is attached.
Number of

Form FR 105 (Call No. 173), Report of Condition of
State member banks.
Form FR 105e (Revised February 1961), Publisher's
copy of report of condition of State member banks.
her's
Form FR 105e-1 (Revised February 1961), Publis
banks.
member
State
of
ion
copy of report of condit
Form FR 220 (Revised March 1952), Report of
affiliate or holding company affiliate.
her's copy
Form FR 220a (Revised March 1952), Publis
affiliate.
of report of affiliate or holding company
for the April 15, 1964,
The forms are identical to those used
call
e, except for the
date and exclude the schedules on the revers
items required for deposit insurance assessment purposes and the
printed by the Federal
!ffiliate schedule. The same form is being
nonmember
uePosit Insurance Corporation for distribution to insured
State banks.
l banks by the Comptroller
The form to be distributed to nationa
If the Currency is expected to be the same as that used for the April 15,
()
l respects from the form
e64, call date and thus will differ in severa
collect supplementary
,lng used by State banks. There are no plans to
purpose of reconciling these
?formation from national banks for the
uif ferences. Under these circumstances, it is not planned to make
will therefore
°mPuter tabulations of the data in Washington, and it
!
(It be necessary to keypunch these reports.
"

A special supplement will be collected from State member
banks for this call for the purpose of providing information on time
certificates of deposit issued to:
Domestic commercial and mutual savings banks
Savings and loan associations
Insurance companies
All others
A similar supplement will be collected from insured nonmember banks
by the Federal Deposit Insurance Corporation. A supply of these forms
will be forwarded later under separate cover. Three copies will be
Provided for each State member bank. Only the original should be
forwarded to the Board.
Very truly yours,

"\rk
Merritt Sh
Secretar
Enclosures.

TO THE PRESIDENTS AT ALL FEDERAL RESERVE BANKS.

• 7,4f1f-N.

BOARD OF GOVERNORS

Item No.

OF THE

FEDERAL RESERVE SYSTEM

9/28/64

WASHINGTON, D. C. 20551
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD

September 28, 1964

The Honorable James J. Saxon,
Comptroller of the Currency,
Washington, D. C. 20220.
Dear Mr. Saxon:
There is enclosed a draft copy of a schedule
prepared for the purpose of collecting from State member
banks supplementary information on time certificates of
deposit issued to certain classifications of depositors.
This schedule will be required from all State
member banks for the forthcoming fall call date. It is
understood that a similar schedule will be collected from
insured nonmember State banks by the Federal Deposit
Insurance Corporation.
Very truly yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
Enclosure.

Full text of Minutes of the Board of Governors of the Federal Reserve System : Meeting Minutes, September 28, 1964, Volume 51, Part 9

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