meeting minutes, june 29, 1950, volume 37, part 2 · batik "in accordance with ... "it is...

860

Minutes of actions taken by the Board of Governors of the

Federal Reserve System on Thursday, June 29, 1950.

PRESENT: Mr. McCabe, ChairmanMr. SzymczakMr. DraperMr. Evans

Mr. Carpenter, SecretaryMr. Kenyon, Assistant Secretary

Minutes of actions taken by the Board of Governors of the

Fede ral Reserve System on June 28, 1950, were approved unanimously.

Memorandum dated June 14, 1950, from Messrs. Young and

N°Yes, Director and Assistant Director of the Division of Research

and Statistics, respectively, recommending an increase in the basic

ealarY of Miss Margaret R. Garber, a statistical assistant in that

from $3,825 to $3,950 per annum, effective July 9, 1950.

Approved unanimously.

Memorandum dated June 28, 1950, from Mr. Young, Director of

the Division of Research and Statistics, recommending that the res-

ignation of John Exter, Acting Chief, Far Eastern Section, Division

r Research and Statistics, be accepted to be effective, in accord-

'nee with his request, at the close of business June 30, 1950, sub-

ject to the understanding in Mr. Carpenter's cable to Mr. Exter sent

P suant to the Board's action of May 19, 1950.


Letter to Mr. Latham, Vice President of the Federal Reserve

8ank of Boston, reading as follows:

In accordance with the request contained inYour letter of June 19, 1950, the Board approvesthe appointment of Robert Bliss Higgins as an as-

Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

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"sistant examiner for the Federal Reserve Bank ofBoston. Please advise us as to the date upon whichthe appointment becomes effective."


Telegram to Mr. Peterson, Vice President of the Federal Re-

serve Bank of St. Louis, reading as follows:

"REURLET June 21. Board approves appointmentWilbur H. Isbell as examiner for Federal ReserveBank of St. Louis. If appointment not made effec-tive July 1, please advise."


Letter to Mr. Slade,,Vice President of the Federal Reserve

Bank of San Francisco, reading as follows:

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"In accordance with the request contained inYour letter of June 22, 1950, the Board approvesthe designation of the following as special assist-ant examiners for the Federal Reserve Bank of SanFrancisco:

Portland Branch G. 0. GannettSalt Lake City Branch J. B. Anderson"Appropriate notations have been made in the

Board's records of the names reported as deletions."


Letter to Mr. Wiltse, Vice President of the Federal Reserve

of New York, reading as follows:

"Reference is made to your letter of June 19,1950, submitting the request of the 'Security TrustC°mParly of Rochester', Rochester, New York, for ap-Proval of the establishment of a branch in Churchville,New York, in connection with a proposed absorptionOf the State Bank of Churchville.

"It is understood that establishment of the branchhas been approved by the State of New York Banking De-Partment conditioned upon consummation of the proposedabsorption of the State Bank of Churchville.

"In view of your recommendation, the Board ofGovernors approves the establishment and operation of


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"a branch in Churchville, New York, by Security TrustCompany of Rochester, Rochester, Nem-York, providedthe absorption of the State Bank of Churchville iseffected substantially as proposed and with the under-standing that counsel for the Federal Reserve BankWill review and satisfy himself as to the legality ofall steps taken to effect the absorption and to es-tablish the branch.

"It is noted that the plan under which the ab-sorption of the State Bank of Churchville is to beeffected contemplates disbursement of the funds rep-resenting capital accounts of the bank absorbed. Itis noted, also, that the Security Trust Company ofRochester is reported to be interested in acquiringOther institutions in Steuben, Yates, Ontario andWayne counties. Therefore, it is suggested that theSecurity. Trust Company be advised that, in the ab-sence of extenuating circumstances, the Board of Gov-ernors does not look with favor upon a policy of ex-pansion involving actual reduction in invested bankcapital."


Letter to Mr. Armistead, Vice President of the Federal Re-

serve Bank of Richmond, reading as follows:

"Reference is made to your letter of June 15,1950, submitting the request of the Nachovia Bankand Trust Company, Kinston-Salem, North Carolina,for permission to establish an additional branch inCharlotte, North Carolina.

"In view of your recommendation the Board ofGovernors approves the establishment and operationof a branch at 126 West Fourth Street, Charlotte,North Carolina, by the Kachovia Bank and Trust Com-Pa4Y, Winston-Salem, North Carolina, provided theformal approval of the State Banking Commission ofNorth Carolina is obtained and with the understandingthat Counsel for the Reserve Bank will review andsatisfy himself as to the legality of all stepstaken to establish the branch."


Letter to Mr. Stetzelberger, Vice President of the Federal


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Reserve Bank Bank of Cleveland, reading as follows:

"Reference is made to your letter of June 19,1950, submitting the request of The Colonial TrustCompany, Pittsburgh, Pennsylvania, for permission toestablish and operate a branch (de novo) in NevilleTownship, Allegheny County, Pennsylvania.

"In view of your recommendation, the Board ofGovernors approves of the establishment and opera-tion of a branch in Neville Township, Allegheny County,Pennsylvania, by The Colonial Trust Company, Pitts-burgh, Pennsylvania, provided the proposed branch isestablished within six months of the date of thisletter and with the understanding that counsel forthe Reserve Bank will review and satisfy himself asto the legality of all steps taken to establish thebranch."


Telegram to Mr. Diercks, Vice President of the Federal Re-

serve Bank of Chicago, reading as follows:

"Reurtel Board extends to July 31, 1950, timeWithin which Bank of Silvis, Silvis, Illinois, mayaccomplish membership."


Letter to Mr. Wiltse, Vice President of the Federal Re-

"rye Bank of New York, reading as follows:

'Reference is made to your letter of June 23,1950, submitting the request of Federal Trust Corn-Pally, Newark, New Jersey, under the requirements ofSection 24A of the Federal Reserve Act for permissionto increase its investment in bank premises by anar!lount not to exceed $20,000. The request is sub-mitted inasmuch as the bank's investment in bankPremises now exceeds the par value of its common cap-ital stock.

"In accordance with your recommendation, the].oard of Governors approves the proposed additionalInvestment in bank premises, not to exceed $20,000,bY the Federal Trust Company, Newark, New Jersey, for


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"the purpose of purchasing property adjoining thetrust company's Springfield Avenue branch and to beused for establishing a drive-in facility."


Letter to Mr. Young, President of the Federal Reserve Bank

of Chicago, reading as follows:

"This refers to your letter of June 22) 1950,informing the Board that your Bank's Board of Direc-tors have approved an expenditure of approximately5P- 23,000 for installation of stand-by oil burningequipment to service one of the boilers in the HeadOffice building, primarily as a precautionary measureshould an adequate supply of coal not be availableat some time in the future. It is noted that byaugmenting the present coal and gas burning equipmentWith this new facility, the Bank would be able toadapt to any likely economic or emergency situation.

"The Board has no objection to the installationof this stand-by oil burning equipment at a cost ofapproximately $23,000 as approved by your Directors."


Letter to Mr. V. H. Rossetti, President, The Farmers and

Merchants National Bank of Los Angeles, Los Angeles 54, California,

reading as follows:

"Receipt is acknowledged of your letter ofJune 13, 1950, referring to our prior correspondenceoncerning the pending Federal deposit insurance leg-islation.

"4e had not understood from your earlier letterthat you were suggesting that insured banks should beclassified on a risk basis, with the banks in the vari-°113 groups being charged different deposit insuranceassessment rates. The Board has not had occasion toecmsider such a proposal, but it would seem that,aside from other possible objections, the difficultyor impossibility of satisfactorily classifying banksfor this purpose would be a major obstacle and thatat best this probably would lead to almost endless


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”controversy.

"'You also suggest that the assessments on newlyinsured banks should be at a higher rate than thoseon other insured banks. In the study made by theBoard's staff, a copy of which was enclosed with ourprevious letter, it was recognized that an argumentcould be made in favor of this proposition on thegrounds of equity, but it was pointed out that suchan arrangement would not involve much of an additionto Federal Deposit Insurance Corporation receipts andwould create serious administrative difficulties.

xe are glad to have your further viewson this subject, we are not undertaking to discussYour proposals in detail because of the legislativeituation. The Senate has passed the Federal depositinsurance bill and the House Committee on Bankingand Currency is nearing the completion of its con-sideration of the bill. Hence, it appears improbablethat suggestions such as you have advanced can re-ceive consideration in connection with this legis-lation°


Secretary.


meeting minutes, june 29, 1950, volume 37, part 2 · batik "in accordance with ... "it is...

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