19240130_Minutes.pdf
Transcript of 19240130_Minutes.pdf
A meting of the Federal Reserve Board was held in the office of
the Federal Reserve Board on Wednesday, January 30, 1924, at 11:15 a.m.
The
PRESENT: Governor CrissingerMr. PlattMr. HamlinMr. MillerMr. JamesMr. CunninghamEr. Eddy, Secretary
minutes of the meetings of the Federal Reserve Board held on ,
'Textuary 28th were read and approved.
The Law Committee submitted without recommendation the\application
" the -Commercial National Bank of Washington, D. C., for fiduciary powers,
toger with a memorandum thereon by Counsel and a letter from the Fed.-
Reserve Agent at Riclunond.
After discussion, it was voted to withhold approvalof the application until such time as the bank makesfurther progress in improving its condition, as borneout by a subsequent regular examination.
Memorandum dated January 28th, from the Director of the Division
ot Research and Statistics recommending the extension from February 1 to
1141t14 31, 1924, of the temporary appointment of Mrs. Margaret T. Hammond.
Approved. .
Telegram dated January 29th, from the Denver Clearing House As-
scleiation, requesting reconsideration by the Board of its recent action in
44113ing Congress that in its opinion an expenditure of not in excess of
Ck5 nr,"(31-vv should suffice for the erection of a suitable building for the
Federal Reserve Bank at Denver.
Noted.
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Letter dated January 24th, from the Assistant Attorney General,
enclosing copy of a letter addressed to the Attorney General by the at-
torneys for the Reserve Deposit Company of Cincinnati, Ohio, regarding
advertising matter issued by that company.
Referred to Counsel.
Letter dated January 26th, from the Governor of the Federal Reserve
laallk of Eansas City replying to the Board's letter of Janwiry 17th with
raglard to the complaint of the Howells State Bank of Howells, Nebraska,
ac.a•lnst the collection of items drawn on it thrau!:7h another bank in that
city.
Referred to Committee on Clearings.
The Law Committee reported on the matter referred to it at the
t"ting on January 16th, namely, letter dated January 14th from the Governor
St the Federal Reserve Bank of New York with regard to the liability of
i'eclsral Reserve banks in the event of payment of bonds and coupons of Fed-
eral Land Banks contrary to instructions; the proposed letter stating that
the Board will leave to the discretion of the Federal Reserve banks questions
(Illsarning the payment of bonds and coupons of Federal Land Banks.
Approved aa amended.
Letter dated January 28th, from the Chairman of the Federal Reserve
Of St. Louis with regard to the organization of the Federal Commerce
t8 -ompany by those interested in the National Bank of Commerce of St. Louis
414 stating that the word "Federal" in the title of the Company was used with-
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out consulting the Federal Reserve bank.
Referred to Counsel.
Memorandum dated January 29th, from Counsel on the subject "Increase
c't Capital by State Member Bank Which has Given Notice of Withdrawal From
the 'Federal Reserve System".
Approved.
Report of Law Committee on letter dated January 24th from the Fed-
"51 Reserve Agent at Richmond with regard to the intention of the New Bern
and Trust Convany of New Bern, North Carolina, to withdraw from the
libederal Reserve System because of its desire to establish branches from
to time after February 1, 1924, without the approval of the Federal
48erve Board; the Committee in its report concurring in the statement con-
in a memorandum of Counsel dated January 26th that as the Board did
234t require the Now Bern Bank at the time it was admitted to membership to
Itree that it would not establish branches without the Board's approval,
it la not subject to expulsion from the System because of the establishment
°t branches without the Board's permission, and that the Board has no
atith°rity over the establishment of its branches so long as it maintains
Ital reserve and keeps itself in sound condition.
After discussion, the report was referred back
to the Law Committee for revision, and preparation of a
letter to the Federal Reserve Bank of Richmond.
Report of Committee on Examinations on the matter referred to it at
he tneeting on January 28th, namely, telegram dated January 26th from the
?ea°mi. Reserve Agent at San Francisco, transmitting and recommendinc; ap-
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Of the application of the Security Trust and Savings Bank of Los
4geles for permission to purchase the Citizens Savings Bank of Inglewood
and its branch in Hyde Park, with a view of establishing branches in the
PreMises now occupied by that institution and its branch; the Committee
recommending tentative approval but reserving final action until the details
of the arrangement shall have been completed and the records cleared as to
the approval of the State Banking authorities and the Federal.Reserve Bank
et San Francisco.
After discussion, Mr. Miller moved that the following
telegram be sent to the Federal Reserve Agent:
"Your wire 26th. Subject to the approval of the State
Superintendent of Banks being obtained, Board approves of
negotiations of Security Trust and Savings Bank to acquire
Citizens Savings Bank of Inglewood and its branch at Hyde
Park, with a view of establishing two branches in premises
occupied by the banks".
Carried.
Report of Committee on Examinations on matter referred to it at the
4leeting on January 28th, namely, letter dated January 26th from the As-
ant Federal Reserve Agent at Cleveland advising of the application of
t11° Provident Savings Bank and Trust Company of Cincinnati to establish
three additional branches in Cincinnati; the Committee recommending that
the Board acknowledge receipt of this notice and instruct the Secretary
to advise the Federal Reserve bank that it will be necessary for the Board
to haVe definite information, showing the approval of the State Banking
4/1thor1ties, and also the approval of the Federal Reserve Bank of Cleveland,
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either through its directors or Executive Committee, before the applica-
tion oan be approved.
Upon motion, the report of the Committee onExaminations was approved.
Report of Committee on Examdnations on letter dated January 24th,
trobilthe Federal Reserve Agent at San Francisco, transmitting formal ap-
lioation of the Security Trust and Savings Bank, Los Angeles, to acquire
the First Vational Bank of Monrovia and the Monrovia Savings Bank and to
ePerate branches in premises now occupied by those institutions, tentative
ItInftval to which was given at the meeting on January 28th; the Committee
"ille that it does not feel that the application is complete in detail
atd,further, that before the Board finally passes upon or gives approval
to aPPlications of this character, the records should be complete as to the
41P1)rcl,a1 of the State Banking authorities and their having been reviewed
13'7the Board of Directors or Executive Committee of the Federal Reserve
11411k Of the District.
Mr. Miller moved that the following telegram be sentto Mr, Perrin:
"Your letter 24th. Subject to approval of the StateSuperintendent of Banks being obtained, Board approves of
negotiations of Security Trust and Savings Bank to acquire
First National Bank of Monrovia and the Monrovia SavingsBank with a view of establishing two branches in premises
occupied by the banks".
Carried.
RePort of Committee on :caminat ions on matter referred to it at the
14etilm.--z,) on January 28th, namely, telegram dated January 21st and letter
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d4ted January 22nd from the Federal Reserve Agent at San Francisco transmit-
and, recommending approval of the application of the Pacific Southwest
411st and Savings Bank to acquire, through exchange of stock, the ',first
114110nal Bank and Trust Company of Santa Paula and its affiliated institutions,
thela.,nta Paula Savings Bank and the Farmers and Merchants Bank of Santa Paula,
t°gether with branches of the latter institution at Saticoy and Fillmore, and
to establish one branch at Saticoy, one at Fillmore and tv...o at Santa Paula,
l'e8"eving the right later to consolidate the two Santa Paula offices into
°Ile branch; the Committee recommending approval of the application.
Mr. Hamlin moved that the report of the Committee be approved.
.Mr. Hamlin's motion being put by the chair was lost,the members voting as follows:
Governor Crissinger, "no"Mr. Miller, "no"Ur. Cunningham, "no"Mr. Platt, "aye"Ur. Hamlin, "aye"Mr. James, "aye"
Letter dated January 23rd, from the Federal Reserve Agent at San
taco, transmitting and recommending approval of the application of the
BItlik of Italy to establish a branch at 5716 Geary Street, San Francisco.
Referred to Committee on Examinations.
Telegram dated January 29th, from the Federal Reserve Agent at San
11141".800 transmitting the application of the Bank of Italy to purchase the
Bank of Hini;sburg and to establish a branch in its premises.
Referred to Committee on Examinations.
?re.
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Report of Committee on Examinations on matter referred to it at the
tneGttaig on January 24th, namely, a letter dated January 22nd, from the As-
Blatant Federal Reserve Agent at Chicago, enclosing a letter from the Dan-
aCer of the Detroit Branch advising that it is the intention of the Highland
l'"k State Bank, Highland Park, Dichigan, to open a branch in that city;
the Committee recommending approval of a lotto; requesting further infolzation,
844re5sed to the Federal Reserve bank by the Secretary of the Board under
4to clf January 26th.
Upon motion, the report of the Committee onExaminations was approved.
Report of Committee on Examinations on letter dated January 21st
*1514 the Federal Reserve Agent at San Francisco, transmitting and recom-
tell:1111C approval of the application of the Pacific Southwest ?rust and Say-
14'8 Bank to take over the First National Bank of Wilmin3ton.and to merge
the ,uuelness of the 7iilmington bank with that of its Wilmington branch; the
01511"tee stating that this application does not involve the establishment
Or ft.-c'41 additional branch and recommending approval.
Upon motion, the report of the Committee onExaminations was approved, Governor CrissinL;er voting"no".
Report of Committee on Examinations on letter dated January 25th,
Dtlithe Federal Reserve Agent at St. Louis transmitting and recommending
vlial Of the application of the Liberty Insurance Bank of Louisville,
for permission to open a branch in Louisville; the Committeetee°
trtnending that the Board give its approval with a possible condition
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that the the approval of the directors of the Branch Federal Reserve Bank at
Louisville shall be secured before the Board's approval becomes effective.
Upon motion, the report of the Committee on
Examinations was approved.
Report of Committee on Examinations on letter dated January 26th,
rtom the Issistant Federal Reserve Agent at Cleveland, transmitting the
aPPlication of the Cleveland 2rust Company for permission to establish a
btanch in inkewood, Ohio; the Committee stating that as it has been the
13(lar'd es policy to grant approval only after applications have had the ap-
Pt°val Of the State Banking authorities and of the Bord of Directors or
ecutive Committee of the Federal Reserve bank of the District, this ap-
I)lication should take the proper course in this regard before the Board
Thres its epprJval.
Upon motion by LLr. Platt, the report of the Committee
was approved, Governor Crissinger voting "no".
Report of Committee on Examinations on matter referred to it at the
41"ing on Janu. Ty 25th, namely, letter dated January 24th from the Federal
1(18(51*ve Agent at Boston transmiuting and recommending approval of the appli-
ti11--O4 Of the Industrial 2rust ComTany of Providence, Rhode Island, for
Ile/11138ton to open four branches within the city limits of Providence, one
btctriCh at Centredale and one at Central Falls; the Comaittee stating that
ided the State Banking authorities and the Board of Directors or .:1xecu-
tIe00Mmittee of the Federal Reserve Bank of Boston approve the application,
se88 no reason why the Federal Reserve Bord should not in turn grant
t4toval,
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After discussion, Mr. Millr moved that the
Federal Reserve Agent be advised that the Board will
suspend action on the application until it has re-
ceived a report from the Executive Committee of the
Federal Reserve Bank of Boston and the Superintendent
Of Banks of the State of Rhode Island, and that he
should inform the bank that its application will be
treated as filed prior to February 1st and all rights
reserved under it.Carried.
Letter dated January 26th, from the Bank Commissioner of the State of
1121(xle Island stating that if the Board can consistently allow the Rhode
'Bland Hospital Trust Company to establish branches in certain cities and
t°17ills as they desire, they have permission to act provided they conform
to state laws.
Noted.
Report of Committee on Examinations on matter referred to it at the
iteetinG on January 24th, namely, a letter dated January 18th from the
Neral Reserve Agent at Boston, transmitting and recommending approval
or application of the Rhode Island Hospital Trust Company of Provi-
cle4ce, Rhode Island, for permission to open branches in 4ester1y, Nemport,
°011mocket, Warwick, West Warwick, '.;arren and Bristol; the Committee sub-
Itittine a majority report signed by Messrs. James and Dawes and a minority
signed by Mr. Platt as follows:
MaAprity Report
"Committee recommends that before acting on these applica-
tions, approval of the State Banking authorities of Rhode Island
should be submitted tlth the approval also of the Federal Reserve
Bank at Boston, through its Board of Directors or Executive Committee".
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"Committee further recommends that each application
should be made separately and not in blanket form as here-
in presented. In the event the details cannot be completed
by February 1st, Committee would recommend the understanding
on the part of the Board that the application was on file
prior to February 1st."
Minority Report.
"The letter from the President of the Rhode Island
Hospital Trust Company states that the Superintendent of
Banks of Rhode Island has given his approval of the applica-
tions :or branches enclosed, and the Federal Reserve Agent
at Boston also expresses approval. The Board has never re-
quired, so far as I am aware, a fdrmal statement from the
Superintendent of Banks but has always relied upon the state-
ment of the Federal Reserve Agent to the effect that the
Superintendent had approved. If the Board wishes to obtain
a letter of formal approval from the Superintendent of Banks
and also wishes the matter submitted to the .:xecutive Commit-
tee of the directors of the Federal Reserve Bank of Boston,
I see no objection."
"I concur in general in the Committee's recommendation
that each application should be made separately but I sec
no reason in a case like this why several applications Should
not be submitted together. I assume that it is not the inten-
tion of the Rhode Island Hospital 2rust Company to rush into
the establishment of all these branches immediately. It mere-
ly wants assurance, as I understand it, that it can establish
the branches as details are worked out and plans perfected.
".;ith this understanding I concur in the final recommendation
Of the Committee that the applications are to be treated as
on file prior to February 1st, with details to be worked out
later, so that they come within the limit set by the Board's
resolution of Novamber 7th."
After discussion, Mr. Hamlin moved that the ap-
plication of the rihode IA.and Hospital 2rust Company
ue aDproved.Carried, Mr. Cunningham voting "no", and
Governor Crissinjer "not voting".
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Letter dated January 29th, from Mr. M. C. Ealiott, Counsel for the
1110* of Italy, making application on behalf of that bank for permission to
flocruire by purchase from the Bancitaly Corporation the assets of the First
44tional Bank of El Centro, the American rational Bank of Santa Ana, the
l'irat National Bank of Shafter and the First rational Bank of San Juan,
414 to establish branches at the existing locations of those banks.
Upon motion by Mr. Hamlin, the applications
were received and referred tothe Committee on
Examinations.
IkPATS OF STANDING COMMTTEES:
bat ea ,
bated,
bat ea,
be. d,
January 28th,29th,
January 30th,
January 26th,29th,
January 28th,
January 28th,
Recommending changes in stock at Federal Reserve
banks, as set forth in the Auxiliary Minute Book
of this date.Approved.
Recommending action on applications for fiduciary
powers as set forth in the Auxiliary Minute Book
of this date.Approved.
Recommending action on applications for admission
of state banks, subject to the conditions stated
in the individual reports attached to the applica-
tions, as set forth in the Auxiliary Minute Book
of this date.Approved.
Recomnending approval of the application of Hr.
Frank TtLi Male to serve at the same time as director
of the Newton Trust Company, Newton, Mass., of the
First rational Bank, West Newton, Bass., and of the
First National Bank, Boston, Mass.
Approved.Recommending approval of the application of Mr.
George W. Donaghey to serve at the same time as Rodk
president and director of the Bankers Trust Company, Little/
and as vice president and director of the First
National Bank, North Little Rock, Ark.
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ORTS 0
bated,
Dated,
STANDING COMMITTEES: (CONT'D)
January 29th, Recommending approval of the application of Mr.
Howard Bayne to serve at the same time as director
of the Morristown Trust Company, Morristown, N.J.
and of the Seaboard National Bank, New York City.
Approved.January 29th, Recommending approval of the application of
John O'Brien to serve at the Immo time as director
of the First National Bank, Wolcott, N.Y. and as
director and officer of the National American Bank,
New York City.Approved.
414Droveci.:
•
The meeting adjourned at 1:15 p.m.
Secretary.
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