3566

A meeting of the Federal Reserve Board was held in Vgashing-

O Thursday, Lovember 22, 1934, at 11:30 a. m.

The

PRESENT: Er. Eccles, GovernorEr. Thomas, Vice GovernorMr. HamlinEr. LinerEr. JamesLi'. Szymczak

Er. Morrill, SecretaryEr. Bethea, Assistant SecretaryMr. Carpenter, Assistant Secretary

Board acted upon the following matters:

161egram dated November 21, 1934, from Mr. Wood, Chairman ofthe Federal

Reserve Bank of St. Louis, advising that, at a meeting oft4 b

"rd. of directors on that date, no change was made in the bank's

"'I'tilog schedule of rates of discount and purchase.

Without objection, noted with approval.

Telegram dated November 21, 1934, approved by six members ofyard, to Ur. LcClure, Chairman of the Federal Reserve Bank of

CitY, reading as follows:

tor "Your letter November 15. Federal Reserve Board approvesJ.21,1 Your bank, effective immediately, flat commitment rates onII:atrial advances to financing institutions of -% for periodsmolaj,xeeeding three months, 1% for periods in excess of threeaix -8 and not exceeding six months, for periods exceedingexcen1.0,/.1ths and not exceeding nine months, and 2-i; for periodsis J.:', 11:t nine months and not exceeding twelve months. As itto eated by action your executive committee that it may be011 c desirable to charge rates higher than rates stated abovetor°171:1:Litments direct to borrowers, it is suggested your direc-ra.tcs Ix and submit to Board for approval minimum and maximumricers° e°rilmitments direct to borrowers with authority to of-"41

gu;fili%Tzel."on each commitment within limits of minimum

Zkatte

Approved.

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4,

Letter to Lr. lioxton, Federal heserve Agent at the Federal

serve Bank of Richmond, reading as follows:

"In connection with the report of examination of the 'Stal,e-laanters Lank and Trust Company', Richmond, Virginia, of June12, 1934, it has been observed that, among other things, you1!,,ve taken up with the bank the apparent violations of section", A of the Federal Reserve Act on account of the bank's ad-

ve-nees to affiliates. It is not clear that, in your considera-

V:cm of this matter with the member bank, you had in mind that,,10 bank had acted in violation of the provisions of the Federal"eserve Act in purchasing stock of Kimbrell's Inc. In thisconnection, attention is called to the fact that, under thetr°visions of section 9 of the Federal Reserve Act, as amendedty the Banking Act of 1933, a member bank, with certain excep-

not 2.?Ils which do not appear to be applicable in this case, may

Purchase stock in another corporation. Accordingly, it is

;Tested that, if you have not already done so, you call thisPO it also to the attention of the member bank; and it is as-that you will obtain correction of this matter along with

s'101: other matters criticized in the report of examination asn as Possible and advise the Board from time to time in theere seeett

Approved.

Lettei. to Lr, O'Connor, Comptroller of the Currency, reading

wit_ • _ •193, 'tuceipt is acknowledged of your letter of November 12,$ with reference to the proposed reduction in common capi-,`t 1 stock of4 n

the 'New First National Bank in New Hampton', New3.1r, Iowa, which was approved by the Board on February 21,for : Pursuant to a plan which provided, among other things,fltere ta1Y contribution of 420,000 to be made by local

sts for the purpose of eliminating unsatisfactory assets.

11• Y°u now advise that the bark's condition has been improved,11c:e the original program of capital rehabilitation was formu-

that the amount of assets scheduled for elimination into i'sPort of examination of October 8, 1034, has been reducedco,Z??8 than the amount of the capital reduction, and that no441butio11 is necessary.

With ,in view of the improvement reported, and in accordanceby lour recommendation, tho Board amends its previous approval420.016ing the requirement for a voluntary contribution ofthe ,,%is with the understanding that the other provisions ofPlan as originally approved remain unchanged.

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3568

"It has been noted that since the report of examinationJuly 26, 1933, there has been an increase of approximately

sP294,000 in the bank's deposit liability, resulting in ansomewhat undercapitalized condition. It is assumed, however,that this matter is receiving the attention of your office."

Approved.

Letter to ir. Hoxton, Federal Reserve Agent at the FederalReserve B ank of Richmond, reading as follows:

Reference is made to Lr. Fry's letter of lovember 5 in-quiring whether, in the circumstances described in his letter,a menber bank is required to reduce its holdings of FederalReserve bank stock incident to the retirement of preferred;took. It appears that SCUD time prior to the issue of pre-erred stock, when the member bank reduced its surplus fromcll. n„$ to 500,000, it elected to retain 300 excess shares

Federal Reserve bank stock held as a consequence of such'to :aduction; that when its capital was increased from 01,000,000,14,050,000 by the issue of preferred stock, the bank was84!t allowed to subscribe to additional Federal Reserve bankJock because it held 270 shares of such stock in excess of1.4.e amount required on the basis of its revised aggregate cap-

an-di surplus; and that the bank feels that, inasmuch as itI.2' .not increase its holdings of Federal Reserve bank stock2eIdent to the issue of preferred stock, it should not now be'tesquired to reduce its holdings of Federal Reserve bank stocka result of the retirement of preferred stock.Act 'Under the provisions of Section 5 of the Federal Reserveto f,114 Section II of Regulation I, a member bank is requiredaPPrlie an application for the surrender and cancelation of anred:riate kmcunt of Federal Reserve bank stock whenever itllowiZ! its own capital stool-. Accordingly, the bank shouldpedc:-r-e ea application for the cancelation of 30 shares of

Reserve bank stock incident to the reduction oftoter) in its capital stock, or for the cancelation of its

excess holdins of 300 shares of such stock."

Approved.

the Letter dated Lovember 21, 1934, approved by six members of,Joard, to ,

LeClure, Federal Reserve Agent at the Federal Re-seNliank of

Kansas City, reading as follows:

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3569

"There are inclosed the original and copies of the ClaytonAct pernit granted to Ir. henry Schafer, Oklahoma City, Okla-

to serve at the same time as director of Fidelity National'4'a4k of Oklahoma City, Oklahoma City, Oklahoma, as director andofficer of The Citizens 1;ational Bank of El Reno, El Reno,?klahona , and as director and officer of The Farmers National"calk of ',"hite Deer, Mite Deer, Texas.

"In considering this application, it was noted that theref" a possible impairment of the capital of the Fidelity La-.T 6i°11a1 Bank of Oklahoma City 'then the bank was examined on.11 Y 13, 1934, but that it had been rehabilitated subsequently;"religh the sale of preferred stock to the Reconstruction

thltrethe Corporation and to local interests. It was also notedmanagement of the bank was not considered safe, the

examiner having stated in the confidential section of hisPort that that 'unless a general and material improvement, based!Pcn the cleaning up program now in process is hereafter main-rined, it will probably be found advisable to recommend and11831 upon certain changes in the management of this brInk.'230 It Was also noted that Ir. Schafer resides approximatelyof es fram the recently organized The Farmers National BankAite Deer and that although he attended a majority of theeeto--

meetinrs of The Citizens National Bank of El Renothe past two years, he attended only eighteen of forty-

meetings held by the directors of Fidelity National Bank ofaillna City during the same period.

spoInasmuch as the applicant apparently was not directly re-ha.nsible for the matters criticized by the examiner, the Boardce; l'anted the permit, but it suggests that you endeavor, inhrgeration with the appropriate supervisory authorities, to

13-1.0ut an improvement in the management of the Fidelitythe :nal Bank of Oklahoma City. It is also suggested that whenr_svermite

is sent to Lr. Schafer you advise him that the Boardr::t

d that a director of a bank should have a satisfactoryinZ cf discharging his duties and responsibilities by partic-ics,81:1:g in

the management and operations of the bank which he451:11g, including attendance at directors' meetings.

tioh 'ne Board requests that, when you submit your reconmenda-reporr a result of your annual review of this permit, youprovein fullY as to the progress made in bringing about an in-attend„ in the management of this bank and as to the applicant'sace at directors' meetings.terlt "PY of the permit and a copy of this letter are beingot t the

Federal Reserve Agent at the Federal Reserve Bankealas.”

Lov APDro ved, together with a letter, also datedember 21, 1934, and approved by six members of

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the Board, to LI.. Walsh, Federal Reserve Agent atthe Federal Reserve Bank of Dallas, inclosing acopy of the Clayton Act permit referred to above,and requesting that, when the agent submits hisrecommendation as a result of his annual review ofthe permit, he report fully as to the applicant'sattendance at directors' meetings of The Farmersfiational Bank of White Deer, Texas.

Letters dated November 21, 1934, approved by six membersf the Board, to applicants for permits under the Clayton Act, ad-vising Of approval of their applications as follows:

141** R. A. H. Brandt, for permission to serve at the same time!),.? a director and officer of the First National Bank in Linot,Lorth Dakota, and as a director of The First NationalJoank in Mobridge, Lobridge, South Dakota.

P4 J. Schirber, for permission to serve at the sam time14rs_a director and officer of The First National Ban No-e,

in o-_r_ldge, llobridge, South Dakota, and as a director and officeruz the

Glencross State Bank, Glencross, South Dakota.

Approved.

There 'were then presented the following applications for°IrlaIlges in stock of Federal reserve banks:A

lleation for ORIGINAL Stock:44tional Bank of Commerce in PamhuskasI'elshiazeka, Oklahoma

lications for ADDITIONAL Stocksso.ztrict No. 24s Pirst National Bank of Freeholds

44)1 ehPreehol d,hA

Jerseyan 3 ts

1

and Farmers National Bank ofD sville, New Yorkge(;114shingt anon County National Bank of

Gel-1'44171'11es Granville, New Yorksee Itiver National Bank of Lount10

1_41 1' Lount Licwris, New Yorkiatioaal Bronx Bank ofw

z_ork, New York New York:

Lational BN of Long Island in4orki ew York, New York

New

Shares

72

105

87

78

72

180

60

72

582

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A lications for ADDITIONAL Stocksict o. •

Distr S'iNtedesboro Trust Company,Sw

edesboro, Lew Jersey

District No. 5.The eoples National Bank of Parkersburg,Par

kersburg, West Virginia

vort Ladisciri7W.vings Bank,Port Ladison, Iowa

District No. 8.outhern

Commercial and Savings Bank,St, Louis, Lissouri

Iriatrict No. 9.ihe First

National Bank of Buhl,'

,,, kill, Minnesotahe First National Bank of Caledonia,

fr.,_ge Caledonia, Li nnesotaA First iatj011 Bank of McIntosh,4Intosh, Linnesota

-6-

(Continued

lications for bURREUDER of StocksIstrict No. 2.4e PirirkiliTT7enal B of West New York,West New York, New Jersey

strlct No. 5.4110 zens

National Bank of44111ncm., Virginia

Hampton,

14etriet 8.

heikrotks t?.8 National Bank of Hot Springs,The Th PrInge, Arkansas'eoPles National Bank of St. FranThe St.

Franclle, Illinois cisville,

Pirst National Bank of Petersburg,,Ilitersburg, Indiana(„3..rst National Bank of Clayton,''.12(Yten, Lissouri

14 riet No. 9.

Di4t

et:iret Lational Bank of Larshall,1'13411,

Linnesota

Shares

18

240

27

84

6

9

10

3571

18

240

27

84

25Total

300

60

66

27

27

32

15

976

300

60

152.

15

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AP lications for SURREhDER of Stock: rjct

10.The Oberli:71713:TY3nal Bank,Oberlin,

KansasColt:gore° Trust Company,Kanzas City, Lissouri

District No. 11.ihe Brady National BanksBrady, Texas

..1A,t2Itlpt No. 12.-the Amie-Frelia—kational Batik of Portland,

Portland, Oregon

(Continued)

PProved

Approved.

Shares

60

1,200

30

300

3572

1,260

30

300

Thereupon the meeting adjourned.

Governor.

Total 2,117

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