19331229_200p_Minutes.pdf

648

A meeting of the Federal Reserve Board was held in Washington

on Friday, December 29, 1933, at 2:00 p. m.

PRESEid: Li-. Black, Governor

Er. HamlinEr. MillerEr. JamesMr. ThomasEr. Szymczak

Er. Morrill, Secretary

Er. Carpenter, Assistant Secretary

Yr. Bethea, Assistant Secretary

The Board considered and acted upon the following matters:

Telegraphic reply to a letter dated December 19, 1933, from

11r. Logan, Deputy Governor and General Counsel of the Federal Reserve

13anic of New York; the reply reading as follows:

"In view of statements contained in your letter of December

19 and inclosed copy of letter from Jenkins, Deyo, and Hitchcock,

attorneys, and in view of your recommendation, Board after con-

sideration approves payment by Federal Reserve Bank of New York

of fee not exceeding in aggregate the sum of Q8,000 to Jenkins,

Deyo , and Hitchcock, for services rendered by them in connection

With the prosecution of a preferred claim filed by the Federal

Reserve Bank against the State Bank of Binghamton, New York, such

fee to cover all services to date and such further services as

may be necessary until after the entering of order by trial court

following decision in the present proceeding. It is understood

that this fee does not cover services in connection with any fur-

„her proceedings that may be necessary in order to determine

other questions not now before the court for decision. The fee

approved herein is in addition to the fee of ;2.,000 which hasbeen paid by your bank to Jenkins, Deyo, and Hitchcock for their

services in connection with the claim against E. C. Brewer kjom-

Pany but except in that respect is in lieu of and not in additionto fee of $5,0OO a:proved in the Board's letter of July 1, 1932.

Approved.

Telegrams to Mr. Curtiss, Federal Reserve Agent at Boston,

8tating that, subject to the issuance by the Board of a limited voting

PeIllit to the "Old Colony Trust Associates”, Boston, Massachusetts,

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

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and to the conditions prescribed in the individual telegrams, the

Board approves the applications of the following State banking insti-

tutions for membership in the Federal Reserve System and for the ap-

Propriate amount of stock in the Federal Reserve Bank of Boston:

"Canton Trust Company", Canton, Massachusetts.

"Menotomy Trust Company", Arlington, Massachusetts.

"Needham Trust Company", Needham, Massachusetts.

"Stoughton Trust Company", Stoughton, Massachusetts.

Approved.

There was also presented a telegram to Mr. Curtiss, Federal

Reserve Agent at Boston, stating that the Board has considered the

4PPlication of the "Old Colony Trust Associates", Boston, Massachu-

setts, for a voting permit under authority of section 5144 of the

Revised Statutes of the United States, as amended, entitling such

°rganization to vote the stock which it owns or controls in the fol-

1"ing banking institutions:

"The Appleton National Bank of Lowell", Lowell, Massachusetts,

"The Concord National Bank of Concord", Concord, Massachusetts,

"The Dedham National Bank", Dedham, Massachusetts,

"The First National Bank of Mansfield", Mansfield, Massachusetts,

"The Lechmere National Bank of Cambridge", Cambridge, Massachu-

setts,"The National Mount Wollaston Bank of Quincy", Quincy, Massachu-

setts,"The Second National Bank of Malden", Malden, Massachusetts,

"Springfield National Bank", Springfield, Massachusetts,

The Union Market National Bank of Watertown", Watertown, Massa-

chusetts,Boulevard Trust Company of Brookline", Brookline, Massachusetts,

'I:Everett Bank and Trust Company", Everett, Massachusetts,

"Harvard Trust Company", Cambridge, Massachusetts,

rnewton Trust Company", Newton, Massachusetts,

:ilinchester Trust Company", Winchester, Massachusetts,,,WinchesterTrust Company", Arlington, Massachusetts,

:',Canton Trust Company", Canton, Massachusetts*,Neodham Trust Company", Needham, Massachusetts,

'Stoughton Trust Company", Stoughton, Massachusetts,


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8.nd has authorized the issuance of a limited permit to the applicant,

subject to the following conditions:

"First. Prior to issuance to Applicant of limited voting per-

mit authorized hereunder, there shall be furnished: (1) Evidence

satisfactory to you and to counsel for Federal Reserve Bank of

Boston that neither Old Colony Trust Company, Boston, Massachu-

setts, nor The First National Bank of Boston, Boston, Massachu-

setts, owns or controls, directly or indirectly, majority of

stock of any member bank listed after letter 'B' above, or is

otherwise affiliated with any such bank in any manner set forthin section 2, subsection (c) of Banking Act of 1933; (2) Evidence

satisfactory to you that Monotony Trust Company, Arlington, Massa-

Canton Trust Company, Canton, Massachusetts, NeedhamTrust company, Needham, Massachusetts, and Stoughton Trust Com-

pany, Stoughton, Massachusetts, respectively, have accepted and/Or

satisfied conditions of membership proscribed by Board in its

telegrams to you approving membership applications of such banksCo that such banks may properly be admitted to membership in Fed-eral Reserve System simultaneously with or forthwith upon issuanceof limited voting permit authorized hereunder; and (3) StatementOf Counsel for Federal Reserve Bark of Boston that agreement re-

quired by condition Second hereof is in form satisfactory to himand is valid and binding obligation of Applicant. Second. Priorto issuance to Applicant of limited voting permit authorized here-

under, Applicant shall undertake and agree: (1) That it will not,

directly or indirectly, borrow from or otherwise become indebtedto, any of its subsidiary or affiliated organizations, for the

Purpose of obtaining funds for use in making any contribution or

investment in connection with the reorganization or rehabilitationof any such subsidiary or affiliated organization, unless the

mritten consent of the Federal Reserve Board is first had and ob-tained; (2) That it will take such action as may be necessary to

consummate or cause to be consummated in accordance with the termsthereof certain plans involving, among other things, a reductionin the capital stock of The First National Bank of Mansfield, Mans-field, Massachusetts, and of The Second National Bank of Malden,LIalden, Massachusetts, respectively, which plans have been hereto-fore submitted to the Federal Reserve Board by the Comptroller ofthe Currency in a memorandum dated December 5, 1933, as supplementedby a memorandum dated December 15, 1933, and in a memorandum dated

December 20, 1933, and that it will use its best efforts to causeeach plan involving an increase in the capital funds of any of its

subsidiary banks to be effected in a manner satisfactory to the ap-

propriate supervisory authorities and to the Federal Reserve Agentat the Federal Reserve Bank of Boston; and (3) That all capitalfunds which may be released or made available under any plan forthe recapitalization or rehabilitation of any subsidiary bank

Pursuant to a reduction in capital stock of the bank will be used


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"for the purpose of eliminating undesirable assets in the bankor of establishing reserves therefor, and that no part of the

capital funds so released or made available will be distributedto the shareholders of the bark or of the undersigned in any man-nerwhatsoever, and that all assets of each such bank which maybe charged off or otherwise eliminated under any such plan will

remain the property of the bank and 7/6.11 not be distributed tothe stockholders of the bank or of the undersigned or otherwisereleased in any manner whatsoever."

and for the following purposes:

"(1) To elect directors of such banks at the annual meetingsof shareholders, or at any adjournments thereof, at any timeprior to April 1, 1934, and to act thereat upon such natters ofa routine nature as are ordinarily acted upon at the annual meet-ings of such banks. (2) To authorize an increase in the capitalfunds of any of such banks, at any time prior to July 1, 1934, inaccordance with such plan or plans as shall be approved by theappropriate supervisory authorities and by the Federal ReserveAgent at the Federal Reserve Bank of Boston, and to do all suchthings as may be necessary for this purpose. (3) To authorize areduction and/Or increase in capital stock, change in number ofShares of stock and/Or change in par value of shares of stock ofThe First National Bank of Mansfield, Mansfield, Massachusetts,and of The Second National Bank of Malden, Malden, Massachusetts,respectively, and to authorize the issuance by such banks of pre-ferred stock of one or more classes, in such amount Arti of suchpar value as shall be approved by the Comptroller of the Currencyof the United States, all in accordance with such plan or plansas shall be approved by the appropriate supervisory authoritiesand by the Federal Reserve Agent at the Federal Reserve Bank ofBoston, and to make such amendments to the articles of associa-tion and certificates of incorporation and/Or bye-laws of thebanks as may be necessary for the purposes set forth in this para-graph."

Approved.

In connection with the above matter there was also presented

letter to Mr. O'Connor, Comptroller of the Currency, reading as

follows:

"In accordance with your recommendation, the Federal ReserveBoard approves a reduction in the common capital stock of 'TheFirst National Bank of Mansfield', Mansfield, Massachusetts,from 25O,OOO to 0.00,000, pursuant to a plan which provides


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"that the bank's capital shall first be increased from $100,000

to $250,000 by the sale at par at $150,000 par value common

stock to be paid for out of the proceeds of a 'Guaranty Fund'

now held by the bank, and which provides also that the bank's

capital shall be further increased by the sale at par of $50,000

par value preferred stock to the Reconstruction Finance Corpora-

tion, and that the funds released by the reduction in common

capital stock, together with a portion of the 'Guaranty Fund,'

undivided profits and reserves, shall be used to eliminate es-

timated losses in the amount of $75,100 and depreciation in se-

curities in the lower grades in the amount of $114,503, all as

set forth in your memorandum of December 5, 1933, as amended by

your supplemental memorandum dated December 15, 1933.

"In considering the plan under which the reduction in Gammon

Capital stock is to be effected, it was noted that no provision

was made for the elimination of depreciation in securities in

the higher grades of approximately $100,595, which amount is suf-

ficient to impair the bank's common capital to the extent of

approximately $31,140. It is assumed, however, that you have

this condition in mind and that, whenever it becomes feasible

to do so, you will obtain such further corrections as may be

practicable."

Approved, together with a second

letter to the Comptroller of the Cur-

rency, reading as follows:

"In accordance with your recommendation, the Federal Reserve

Board approves a reduction in the common capital stock of 'The

Second National Bank of Malden', Malden, Massachusetts, from

0300,000 to $200,000, pursuant to a plan which provides that the

bank's capital shall be increased by the sale at par of $100,000

Par value preferred stock, $50,000 of which it is proposed to

sell to the Reconstruction Finance Corporation and $50,000 of

Which will be paid for out of the proceeds of a special deposit

now held by the bank, and which also provides that the funds

released by the reduction in common capital stock and $35,000of funds from the bank's surplus, undivided profits and/Or re-

serves shall be used to eliminate estimated losses and deprecia-

tion in securities in the lower grades of not less than $135,000,

all as set forth in your memorandum of December 20, 1933.

"In considering the plan under which the reduction of common

capital stock is to be effected it was noted that approximatelyA%P3,200 of depreciation in securities below the four highest

grades is unprovided for, in addition to which there will remain

in the bank 458,151 of depreciation in securities in the four

highest grades, c41,470 of doubtful assets, and $564,046 of slow

assets. It is assumed, however, that you have these conditions

in mind end that whenever it becomes feasible to do so you will


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"obtain such such further corrections as may be practicable."

Telegrams to Mr. Case, Federal Reserve Agent at New York,

Stating that, subject to the conditions prescribed in the individual

telegrams and to the issuance by the Board of limited voting permits

to the "First National of Elmira Corporation" and the "First National

8an1c 47, Trust Company of Elmira", both of Elmira, New York, the Board

aPProves the applications of the "Watkins State Bank", Watkins Glen,

Nem York, and "The Bank of Elmira Heights", Elmira Heights, New York,

for membership in the Federal Reserve System and for the appropriate

lunount of stock in the Federal Reserve Bank of New York.

Approved.

In connection with the above there was also presented a tele-

gram to Mr. Case, Federal Reserve Agent at New York, stating that the

Board has considered the application of the "First Eational Bank 4:

Truut Company of Elmira", Elmira, New York, for a voting permit under

authority of section 5144 of the Revised Statutes of the United States,

48 amended, entitling such organization to vote the stock which it awns

Controls in the following banks:

11:The Bank of Elmira Heights", Elmira Heights, New York,IWatkins State Bank", Watkins Glen, New York,'The Citizens National Bank of-Waverly", Waverly, New York,"The First National Bank of Horseheads", Horseheads, Now York,tr-oouthside National Bank of Elmira", Elmira, New York,

811d haG authorized the issuance of a limited permit to the applicant,

GUbject to the following conditions:

"First. Prior to the issuance to the Applicant of the limitedvoting permit authorized hereunder: (i) There Shall be furnishedevidence satisfactory to you that the Applicant has charged off


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and

and

"or otherwise eliminated losses of $266,236.04, and depreciation

of (179,956.61 in securities other than those in the four high-

est grades as classified by a recognized investment service or-

ganization regularly engaged in the business of rating or grading

securities, all as shown in the report of examination of such

bank as of July 8, 1933, by F. R. Peterson, a national bank exam-

iner. (ii). Applicant shall agree: (a) That it will exert its

best efforts to make proper corrections of all matters criticized

in the report of examination made of the bank as of July 6, 1933,

by F. R. Peterson, a national bank examiner, and will do all such

things as may be necessary to eliminate all causes of criticism

in respect to such matters as soon as it is feasible to do so.

(b) That it will use its best efforts to cause proper correctionsto be made of all matters criticized in the last report of examina-

tion of each of its subsidiary national banks, and in the reportsof examination of the two subsidiary State banks to which referenceis made in the Federal Reserve Board's telegrams of December 29,

1933, approving the applications of such State banks for menber-

ship, and that it will do all such things as may be necessary to

eliminate or cause to be eliminated all causes for criticism inrespect to such matters as soon as it is feasible to do so, in-

cluding the elimination or reduction of loans held by its subsidi-ary banks which are secured in whole or in part by its capital

stock, or the substitution of other adequate security for its

stock securing such loans. Second. Simultaneously with the is-

suance of the limited voting permit authorized hereunder, there

shall be issued to First National of Elmira Corporation, Elmira,New York, the limited voting permit authorized in the Board's

telegram of this date to the Federal Reserve Agent at the Federal

Reserve Bank of New York."

for the following purposes:

"(1) 10 elect directors of such banks at annual meetings of

Shareholders, or any adjournments thereof, at any time prior to

April 1, 1934, and to act at such meetings, or any adjournments

thereof, upon such matters of a routine nature as are ordinarily

acted upon at the respective annual meetings of such banks. (2)10 authorize a reduction and increase in capital stock, change in

number of shares of stock and/or change in par value of shares ofstock of The Citizens National Bank of aaverly, Waverly, New York,ln accordance with a plan which has been submitted to the Federal

Reserve Board and which is referred to in the Board's letter tothe Comptroller of the Currency of the United States approvingsuch reduction in capital stock. (3) To authorize the amendmentof the articles of association, certificate of incorporation

trItlfor by-laws of The Citizens National Bank of 'Waverly, Waverly,

'low York, and to do such other things as may be necessary, inorder to consummate the plan referred to in paragraph (2) above."

a second telegram to Ni. Case, Federal Reserve Agent at New York,


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stating that the Board has considered the application of the "First

National of Elmira Corporation", Elmira, New York, for a voting permit

Under authority of section 5144 of the Revised Statutes of the bnited

States, as amended, entitling such organization to vote the stock

which it owns or controls in the following banks:

"The Bank of Elmira Heights", Elmira Heights, New York.

"Watkins State Dank", Watkins Glen, New York,

"The Citizens National Bank of Waverly", Waverly, Now York,

"The First National Bank of Horseheads", Horseheads, New York,

"Southside National Bank of Elmira", Elmira, New York,

411d has authorized the issuance of a limited permit to the applicant,

subject to the following conditions:

"First. Prior to the issuance of the limited voting permit to

the Applicant authorized hereunder, there shall be furnished (1)

evidence satisfactory to you (a) that the Bank of Elmira Heights,

Elmira Heights, Now York, has accepted and/Or satisfied the con-

ditions of membership prescribed by the Federal Reserve Board in

its telegram of this date so that such bank may properly be ad-

mitted to membership in the System simultaneously with, or forth-

with upon, the issuance of the voting permit authorized hereunder;

(b) that the Watkins State Bank, Watkins Glen, New York, has ac-

cepted and/Or satisfied the conditions of membership prescribedby the Federal Reserve Board in its telegram of this date so that

such bank may properly be admitted to membership in the System

simultaneously with, or forthwith upon, the issuance of the voting

permit authorized hereunder; (c) that The First National Bank of

Horseheads, Horseheads, New York, has charged off or otherwise

eliminated losses of 021,683 in loans, of 03,624 in defaulted

bonds and stocks, and of 5,000 in its banking house, and net de-

Preciation of 021,840 in securities other than those in the four

highest grades as classified by a recognized investment service

organization regularly engaged in the business of rating or grad-1117 securities, all as shon in the report of examination of such

bank made as of July 25, 1933, by Thomas J. O'Connor, a national

bark examiner; and (d) that the Southside National Bank of Elmira,

Elmira, New York, has charged off or otherwise eliminated losses

of 325 in loans, and of 0'5,258 in bonds and securities, a short-

age of 92, and net depreciation of :21,373 in securities other-1-lan those in the four highest grades as classified by a recognized

Investment service organization regularly engaged in the businessOf rating or grading securities, all as shown in the report of ex-

amination of such bank as of July 8, 1933, by Adam Wetzel, a


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"national bank examiner. (2). Assurances satisfactory to you

(a) that a certain plan involving a reduction and increase in

the capital stock of The Citizens National Bank of Waverly,

Waverly, New York, which plan has been heretofore submitted to

the Federal Reserve Board, has been or forthwith will be duly

consummated in accordance with the terms thereof; (b) that each

national bnrk which is a subsidiary of the Applicant will exert

its best efforts to make proper corrections of all matters

criticised in the last report of examination of the bank made by

a national bank examiner, and will do all such things as may be

necessary to eliminate all causes for criticism in respect to

such matters as on as it is feasible to do so; and (c) that

the banks which are subsidiaries of the Applicant will eliminate,

or reduce materially according to a systematic schedule, or ob-

tain other adequate security therefor, the number and amount of

loans secured in whole or in part by capital stock of the First

National Bank and Trust Company of Elmira, Elmira, New York. 3.

Statement of Counsel for the Federal Reserve Bank of New York

that the agreement required by condition Second hereof is in

form satisfactory to him, and is the valid and binding obliga-

tion of the Applicant in accordance with its terms. Second.

Prior to the issuance of the limited voting permit to the Appli-

cant authorized hereunder, it shall agree in substance (1) that

it will not, directly or indirectly, borrow from, or otherwise

become indebted to, any of its subsidiaries or affiliated organi-

zations, for the purpose of obtaining funds for use in making

any contribution or investment in connection with the reorganiza-

tion or rehabilitation of any such subsidiary or affiliated or-

ganization; and (2) that it will use its best efforts to cause

proper corrections to be made of the matters criticised in the

last report of examination of each of its subsidiary national

banks, and in the reports of examination of the two subsidiary

State banks to which reference is made in the Federal Reserve

Board's telegrams of December 29, 1933, approving the applica-

tions of such State banks for membership, and that it will do

all such things as may be necessary to eliminate or cause to be

eliminated all causes for criticism in respect to such mattersas soon as it is feasible to do so, including the elimination or

reduction of loans held by its subsidiary banks which are secured

in whole or in part by capital stock of the First National Bnnk

and Trust Company of Elmira, Elmira, New York, or the substitution

of other adequate security for stock of the First National Bank

and Trust Company of Elmira securing such loans. Third. Simul-

taneously with the issuance of the limited voting permit authorized

hereunder, there shall be issued to the First National Bank and

Trust Company of Elmira, Elmira, New York, the limited voting

Permit authorized in the Board's telegram of this date to the

Federal Reserve Agent at the Federal Reserve Bank of New York."

44d for the following purposes:


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"(1) To elect directors of such banks at annual neetings of

shareholders, or any adjournments thereof, at any time prior to

April 1, 1934, and to act at such neetins, or any adjournments

thereof, upon such matters of a routine nature as are ordinarily

acted upon at the respective annual meetings of such banks. (2)To authorize a reduction and increase in capital stock, changein number of shares of stock and/or change in par value of sharesof stock of The Citizens National Bank of Waverly, Naverly, NewYork, in accordance with a plan which has been submitted to the

Federal Reserve Board and which is referred to in the Board's

letter to the Comptroller of the Currency of the United States

approving such reduction in capital stock. (3) To authorize the

amendment of the articles of association, certificate of incorpora-tion and/Or by-laws of The Citizens National Bank of Waverly,

viaverly, New York, and to do such other things as may necessary,

ln order to consummate the plan referred to in paragraph (2)

above."

Approved, together with a letter tothe Comptroller of the Currency reading

as follows:

"In accordance with your recommendation, the Federal ReserveBoard approves a reduction in the common capital stock of 'The,91tizens National Bank of Waverly', Waverly, New York, from0-50.000 to $100,000, pursuant to a plan which provides that thebank's capital shall first be increased from $100,000 to $150,000by the sale at par of $50,000 par value common stock to thebank's present stockholders or others, and that the funds re-leased by the capital reduction shall be used to eliminate es-ta.mated losses end securities depreciation, all as set forth inYour memorandum of November 8, 1933.

"It is noted from your memorandum that you deem it best notto require more than a ,:50,000 charge off in assets at this time,and that the question of further charge offs be deferred untilthe next examination is made by one of your examiners."

Telegrams to Lir. Walsh, Federal Reserve Agent at Dallas, stat-

rIg that, subject to the issuance by the Board of limited voting per-

to the "Equitable Securities Company", and the "Uarcantile

'Tatiana' Bank at Dallas", both of Dallas, Texas, and to the conditions

Pr6aoribed in the individual telegrams, the Board approves the appli-

Cati_u4S of the following State banks for membership in the Federal Re-

System and for the appropriate amount of stock in the Federal


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Reserve Bank of Dallas:

-11-

"Farmers & Merchants State Bank", Carrollton, Texas.

"Farmers & Merchants State Bank", Ladonia, Texas."The Farmers & Merchants State Bank of Wylie", Wylie, Texas."The First State Bank", Celina, Texas.

Approved.

In connection with the above there were presented telegrams

to Mr. Federal Reserve Agent at Dallas, stating that the Board

has considered the applications of the "Equitable Securities Company"

and the "Mercantile National Bank at Dallas", both of Dallas, Texas,

for votily; permits under authority of section 5144 of the Revised Stat-

utes of the United States, as amended, entitling such organizations

to vote the stock which they own or control in the following banks:

"Farmers & Merchants State Bank", Carrollton, Texas,"The First State Bank", Celina, Texas,,'

"Farmers & Merchants State Bank", Ladonia, Texas,"Tho Farmers Merchants State Bank of Wylie", Wylie, Texas,

and has authorized the issuance of a limited permit to each of the ap-

Plicants, subject to the following condition:

"i'rier to issuance of such limited votinp, permit, evidence

satisfactory to you shall be furnished that said banks, respec-tively, have accepted and/or satisfied conditions of membership

Prescribed by Board in its telegrams to you approving membershiP4PPlieations of said banks so that said banks may properly beadmitted to membership in Federal Reserve System simultaneouslyuith, or forthwith upon, issuance of such limited voting permit."

'411(1 for the following purposes:

"To olwt directors of such banks at the annual meetinrs of

Shareholders, or any adjournments thereof, at any time prior toApril 1, 1934, and to act at such meetins, or any adjournmentsthereof, upon such matters of a routine nature as are ordinarilyacted upon at the annual meetings of such banks."

Approved.


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Telegrams to the respective Federal reserve agents stating

that, subject to the conditions prescribed in the individual telegrams,

the Board approves the applications of the following State banking in-

8titutions for membership in the Federal Reserve System and for the

aPPropriate amount of stock in the Federal reserve bank of the district

in which the applicant is located:

Applicant Bank Federal Reserve Bank

"Union Trust Company of Springfield",Springfield, Massachusetts. Boston

"Citizens Bank and Trust Company",Mobridge, South Dakota. Minneapolis

"Lusk State Bank", Lusk, Tiyoming. Kansas City

Approved.

Telegram to Mr. Williams, Federal Reserve Agent at Cleveland,

l'eading as follows:

"Rotel December 28 regarding application The Licking County

Bank, Newark, Ohio, Board amends condition numbered nineteen toread as follows:

'19. Prior to admission of such bank to membership, Banc-

Ohio Corporation shall execute a binding agreement in form

and substance satisfactory to the Federal Reserve Agent at

the Federal Reserve Bank of Cleveland and Counsel for the

Federal Reserve Bank of Cleveland whereby BancOhio Corpora-

tion agrees that its deposit of $445,000 shall be left on

deposit with The Licking County Bank, Newark, Ohio, and

shall not be withdrawn in whole or in part until such bank's

liquid position is improved by the sale of nonliquid assets,in which event an equivalent amount will be made available

for withdrawal by BancOhio Corporation, and such withdrawals

from the account shall be made only upon the approval of the

Federal Reserve Agent at the Federal Reserve Bank of Cleve-

land'Under the revised condition the bank's liquid position is to be

improved by the sale of nonliquid assets and the sale of prime

mortgages only shall not be considered grounds for releasing acorresponding amount of the balance. The bank cannot be consid-ered to be in a satisfactory liquid condition until the excessive-ly large amount of statutory bad debts has been very materially


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"reduced through sale or reinstatement of such mortgages intobankable condition."

-13-

Approved.

Telegram to Mr. Curtiss, Federal Reserve Agent at Boston,

stating that the Board has considered the application of the "Wareham

Rational Corporation", Wareham, Massachusetts, for a voting permit

under authority of section 5144 of the Revised Statutes of the United

States, as amended, entitling such organization to vote the stock

Ilhich it awns or controls in "The Buzzards Bay National Bank", Buz-

zards Bay, Massachusetts, and has authorized the issuance of a limited

Permit to the applicant, subject to the following condition:

"Prior to issuance of such limited voting permit, applicantshall deliver to you in triplicate certified copies of its

articles of organization with all amendments to date."

"Ind for the following purposes:

"To elect directors of such bank at the annual meeting of

shareholders, or at any adjournment thereof, at any time priorto April 1, 1934, and to act thereat upon such matters of a

routine nature as are ordinarily acted upon at the annual meet-ing of such bank."

Approved.

Telegram to Mr. Curtiss, Federal Reserve Agent at Boston,

ztating that the Board has considered the application of the "Rhode

Island Hospital Trust Company", Providence, Rhode Island, for a vot-

lit Permit under authority of section 5144 of the Revised Statutes of

the United States, as anonded, entitling such organization to vote

the stock which it awns or controls in the "Rhode Island Hospital Na-

tional Bank of Providence", Providence, Rhode Island, and has author-

the issuance of a limited permit to the applicant for the following


12/29/33

Purposes:

-14-661

"(1) To amend the articles of association of such bank at thespecial meeting of shareholders on January 2, 1934, or at any ad-journment thereof during the month of January, 1934, in the re-spects set forth in the secretary's notice of such meeting to the

shareholders bearing date of December 27, 1933. (2) To elect di-

rectors of such bank at the Annual meeting of shareholders, or atany adjournment thereof, at any time prior to April 1, 1934, andto act thereat upon such matters of a routine nature as are ordina-rily acted upon at the annual meeting of such bank."

Approved.

Telegram to Mr. Stevens, Federal Reserve Agent at Chicaco,

stating that the Board has considered the application of the "Evanston

Bancorporation", Evanston, Illinois, for a voting permit under author-

ity of section 5144 of the Revised Statutes of the United States, as

'6:mended, entitling such organization to vote the stock which it owns

or controls in the "Evanston Trust & Savings Bank", Evanston, Illinois.

:1L1id has authorized the issuance of a limited permit to the applicant

tor

The

the following purposes:

"(1) To elect directors of such bank at the annual meeting of

shareholders, or at any adjournment thereof, at any time prior toApril 1, 1934, and to act thereat upon such natters of a routinenature as are ordinarily acted upon at the annual meeting of suchbank; (2) Within ninety (90) days from the date hereof to takesuch action as may be necessary or desirable to effect an increasein the capital funds of such bank in such amount and in such man-

ner as may be approved by the authorities in the State of Illinois

having supervision of such bank, and by the Federal Reserve Agentat the Federal Reserve Bank of Chicago."

telegram also requested that the agent call to the attention of

ton Bancorporation that before issuing to it a general permit to

Ir°te the shares of stock which it awns or controls of Evanston Trust &

v -Lug.s. Bank, the Federal Reserve Board will, in considering the proba-

blewifect of the granting of such permit upon the affairs of such bank,


662

12/29/33 -15-

take into consideration the character of its management as returned or

installed at the next election of directors.

Approved.

Telegram to Yr. Stevens, Federal Reserve Agent at Chicago, stat-

ing that the Board has considered the application of the "American Hold-

ing Corporation", Chicago, Illinois, for a voting permit under authority

c't section 5144 of the Revised Statutes of the United States, as amended,

entitling such organization to vote the stock thich it owls or controls

in the "A/nerican National Bank and Trust Company of Chicago", Chicago,

Illinois, and has authorized the issuance of a limited permit to the ap-

Plicant for the following purposes:

"(1) To elect directors of such bank at the annual meeting ofshareholders, or at any adjournment thereof, at any tive prior toApril 1, 1934, and to act at such meeting, or at any adjournmentthereof, upon such natters of a routine nature as are ordinarilyacted upon at the annual meeting of such bank. (2) To authorizethe issuance by such bank of common stock and/or preferred stockof one or more classes in such amounts and with such par values asshall be approved by the Comptroller of the Currency and the Fed-eral Reserve Agent at the Federal Reserve Bank of Chicago, and tomake such amendments to its articles of association as may be neces-sary for this purpose."

Approved.

Telegram to Mr. Wood, Federal Reserve Agent at St. Louis,

atItting that the Board has considered the application of the "Trustees

1111der Trust Agreement Dated January 31, 1919, as amended July 30,

1920, and January 26, 1923, with Reference to Stocks in The Citizens1-1114-

141tiona1 Bank of Louisville and Fidelity and Columbia Trust Com-DELIOL

41 both of Louisville, Kentucky" for a voting permit under authority

,, ,ectIon 5144 of the Revised Statutes of the United States, as amended,

entit,''ing such organization to vote the stock which it awns or controls


663

12/294/33 -16-

in "The Citizens Union National Bank of Louisville", Louisville, Ken-

and has authorized the issuance of a limited permit to the appli-

cant, subject to the following condition:

"Prior to the issuance of such permit applicant shall furnish,or shall agree to furnish, to you, in triplicate, as promptly aspossible, (1) Exhibit N FRB Form P4 duly executed by Applicant andconsented to by Fidelity and Columbia Trust Company, Louisville,Kentucky, Louisville Joint Stock Land Bank, Louisville, Kentucky;Union Joint Stock Land Bank, Louisville, Kentucky; Jefferson Prop-erty Company, Louisville, Kentucky; Fidelity and Columbia InsuranceCompany, Louisville, Kentucky; and The Citizens Union National Barkof Louisville, Louisville, Kentucky, and (2) a properly executedcertificate of its Secretary on FRB Form P2 shoving the date of themeeting at which Applicant authorized the execution and delivery ofits application for voting permit."

4114 for the following purposes:

"To elect directors of such bank at the annual meeting of share-holders, or at any adjournment thereof, at any time prior to April1, 1934, and to act thereat upon such matters of a routine natureas are ordinarily acted upon at the annual meeting of such bank."

Approved.

Telegram to Er. Peyton, Federal Reserve Agent at Minneapolis,

atating that the Board has considered the application of the "First Lank

Stock Corporation", Minneapolis, Minnesota, for a voting permit under

aUthority of section 5144 of the Revised Statutes of the United States,

Ets

Or

emended, entitling such organization to vote the stock which it owns

controls in the following banking institutions:

l"Aberdeen National Bank & Trust Company", Aberdeen, South Dakota,"Freeborn County National Bank & Trust Company of Albert Lea",

Albert Lea, Minnesota,"iho armers National Bank in Alexandria", Alexandria, Minnesota,"The First National Bank of Austin", Austin, Minnesota,"the National Bank of Benson", Benson, Minnesota,:171:he Miffland National Bank of Billings", Billings, Montana,"The First National Bank of Bismarck", Bismarck, North Dakota,"The First National Bank of Bison", Bison, South Dakota,et First National Bank of Blooming Prairie", Blooming Prairie,

Minnesota,"First & Farmers National Bank of Blue Earth", Blue Earth, Linnesota,


664

12/29/33 -17-

"The First National Bank of Bowbells", Bowbells, North Dakota,"The Commercial National Bank of Bozeman", Bozeman, Montana,"The First National Bank of Brainerd", Brainerd, Minnesota,"Metals Bank and Trust Company", Butte, Montana,"The First National Bank of Calumet", Calumet, Michigan,"The First National Bank of Cando", Cando, North Dakota,"The Merchants National Bank of Cavalier", Cavalier, North Dakota,"The Clark County National Bank of Clark", Clark, South Dakota,"The First National Bank in Cooperstown", Cooperstown, North

Dakota"The Minnesota National Bank of East Grand Forks", East Grand

Forks, Minnesota,"The First National Bark of Fairmont", Fairmont, Minnesota,

"The Merchants National Bank and Trust Company of Fargo", Fargo,North Dakota,

"Potter County National Bank of Gettysburg", Gettysburg, South

Dakota,"First National Bank in Glen Ullin", Glen Ullin, North Dakota,"The First National Bank of Graceville", Graceville, Minnesota,"Red River National Bank of Grand Forks", Grand Forks, North

Dakota,"The First National Bank of Great Falls", Great Falls, Montana,"The First National Bank of Hancock", Hancock, Michigan,

"The First National Bank of Harvey", Harvey, North Dakota,

"The Montana National Bank of Havre' Havre, Montana,The First National Bank of Hebron", Hebron, North Dakota,

"First National Bank & Trust Company of Helena", Helena, Montana,"The First National Bank of Heron Lake", Heron Lake, Minnesota,"The First National Bank of Highmore", Highmore, South Dakota,"The Security National Bark of Huron", Huron, South Dakota,"The Merchants & Miners National Bank of Ironwood", Ironwood,

Michigan,It Farmers & Merchants National Bank in Ivanhoe", Ivanhoe, Minnesota,

The National Bank and Trust Company of Jamestown", Jamestown,North Dakota,

"The First National Bank of Jordan", Jordan, Montana,"The First National Bank of Laurium", Laurium, Michigan,

::First National Bank in Lemmon!', Lemon, South Dakota,The First National Bank of Leola", Leola, South Dakota,'The National Bank of Lewistown", Lewistown, Montana,„First National Bank in Lidgervlood", Lidgerwood, North Dakota,The American National Bank in Little Falls", Little Falls, Minne-

sota,The National Park Bank in Livingston", Livingston, Montana,

:11The Luverne National folni.-", Luverne, Minnesota,First National Bank & Trust Company of Mankato", Mankato, Minne-

sota,"First National Bank in Liles City", Miles City, Montana,,,The First National Berk of Miller", Miller, South Dakota,

'Bloomington-Lake National Bank of Minneapolis", Minneapolis,

Minnesota,


665

12 / 29 /3 3

a.rta

tor

-18-

"First National Bank and Trust Company of Minneapolis", Minnea-polis, Minnesota,

"Minnehaha National Bank of Minneapolis", Minneapolis, Minnesota,"The Farmers and Merchants National Bank of Minneota", Minneota,

Minnesota,"The Union National Bank and Trust Company in Minot", Minot,

North Dakota,"The Western Montana National Bank of Missoula", Missoula,

Montana,"The First National Bank of Neche", Neche, North Dakota,"The First National Bank of New England", New England, North

Dakota,"The First National Bank of New Rockford", New Rockford, North

Dakota,"Northfield National Bank and Trust Company", Northfield, Minne-

sota,"The First National Bank of Owatonna", Owatonna, Minnesota,"The First National Bark of Park River", Park River, North Dakota,"First National Bank in*Paynesville", Paynesville, Minnesota,'1'Th° Pipestone National Bank", Pipestone, Minnesota,,,The First National Bank of Princeton", Princeton, Minnesota,The Red Wing National Bank and Trust Company", Red Wing, Minnesota,

1,The First National Bank of Rochester", Rochester, Minnesota,_The First National Bank of Rolla", Rolla, North Dakota,The First National Bank of Saint Paul", Saint Paul, Minnesota:

"The Merchants National Bank or Sauk Centre", Sauk Centre, Minne-sota,11

Citizens National Bank and Trust Company of Sioux Falls", SiouxFalls, South Dakota,

The First National Bank of Spring Valley", Spring Valley, Minne-sota,

First National bank of Valley City", Valley City, North Dakota,"The First National Bank and Trust Company of Vermilion", Vermilion,

South Dakota,The Farmers National Bank of Waseca", Waseca, Minnesota,

",First National Bank in Wheaton", Wheaton, Minnesota,'Ithe Security National Bank of Willmar", Willmar, Minnesota,ihe First National Bank of Windom", Windom, Minnesota,

has authorized the issuance of a limited permit to the applicant

the following purposes:

"At any time prior to April 1, 1934: (1) To elect directorsOf such banks at the respective annual meetings of shareholders,or at any adjournment thereof, and to act thereat upon such mat-ters of a routine nature as are ordinarily acted upon at the re-spective annual meetings of such banks; (2) To authorize a reduc-t"n in capital stock, change in number of shares of stock and/or


666

12/29/33 -19-

"change in par value of shares of stock of any of such bankssubject to the approval of the Federal Reserve Agent at the Fed-eral Reserve Bank of Minneapolis and the appropriate supervisoryauthorities including the Federal Reserve Board if its approvalis required by law or otherwise; (3) To authorize the issuanceby any of such banks of capital notes, debentures or preferredstock subject to the approval of the Federal Reserve Agent atthe Federal Reserve Bank of Minneapolis and, if required by law,of the Comptroller of the Currency or in the case of Metals Bankand Trust Company, Butte, Montana, of the proper State bprking

authority; (4) To amend the articles of association, certificateof incorporation and/or by—laws of any of such bRnks in order toeffect the changes set forth in (2) and (3) above; (5) To arendthe articles of association, certificate of incorporation and/orby-laws of any of such banks in order that the number of direc-tors of such banks may comply with existing provisions of lawl(6) To change the names, in accordance with all relevant provi-sions of law, of the following banks: 'Freeborn County 'rationalBank & Trust Company of Albert Lea', Albert Lea, Minnesota, 'The

National Bank and Trust Company of Jamestown', Jamestown, North

Dakota, 'First National Bank 64 Trust Company of Mankato', Mankato,

Minnesota, 'The Union National Bank and Trust Company in Minot',

Einot, North Dakota, 'Northfield National Bank and Trust Company',

Northfield, Minnesota, and 'The First National Bank and Trust

Company of Vermilion', Vermilion, South Dakota; and (7) To con-summate the liquidation of 'The First National Bank of Jordan',Jordan, Montana and 'The First National Bank of Ree Heights', RoeHeights, South Dakota."

Approved.

Telegram to Lir. Newton, Federal Reserve Agent at San Francisco,

8tating that the Board has considered the application of the "Peoples

Corporation,,, Seattle, Washington, for a voting permit under authority

or section 5144 of the Revised Statutes of the United States, as

4Ine11ded, entitling such organization to vote the stock which it orals

°I. controls in the "Peoples Bank and Trust Company", Seattle, Washing-

and has authorized the issuance of a limited permit to the appli-

Ilts subject to the following condition:

"Prior to the issuance of such permit applicant shall agreethat within 90 days from the date of the issuance of the limitedvoting permit aforesaid, the capital funds of Peoples Bank and


667

12/29/33 -20-

"Trust Company will be increased, pursuant to appropriate action,through contributions by stockholders, sale of preferred stock,or otherwise, in such amount as may be approved by the authoritiesin the State of Washington having supervision of such bank and bythe Federal Reserve Agent at the Federal Reserve Bank of San Fran-

cisco."

and for the following purposes:

"(1) To elect directors of such bank at the annual meeting of

shareholders, or at any adjournment thereof, at any time prier to

April 1, 1934, and to act thereat upon such matters of a routine

nature as are ordinarily acted upon at the annual meeting of suchbank; and (2) within 90 days from the date hereof, to take such

action as may be necessary or desirable to effect an increase inthe capital funds of Peoples Bank and Trust Company in such amountand in such manner as may be approved by the authorities in theState of Washington having supervision of such bank and by the Fed-eral Reserve Agent at the Federal Reserve Bank of San Francisco."

Ihe telegram stated also that the agent should call to the attention of

the Peoples Corporation the fact that no permit is granted to it to

vote the shares of stock which it awns or controls of The First National

'lank of Renton, Renton, Washington, or of that bank and the Peoples

44k and Trust Company in connection with the absorption by the latter

Of the former and the operation of the office of the former as a branch

Of the latter; that such matter is being considered with the Comptroller

°t the Currency; and that further advice will be given regarding the

Etane

Approved.

Telegrams to Mr. Newton, Federal Reserve Agent at San Francisco,

itig that the Board has considered the applications of the "Security-

at Company" and the "Los Angeles Trust & Safe Deposit Company", both

Of LOs Angeles, California, for voting permits under authority of sec-

tign.5144 of the Revised Statutes of the United States, as amended,


668

12/203 -21-

entitling such organizations to vote the stock which they awn or con-

trol in "The First National Bank of El Segundo" El Segundo, California,

ahd has authorized the issuance of a limited permit to each of the ap-

Plicants for the purpose of effecting the liquidation of The First Na-

tional Bank of El Segundo.

Approved.

Letter to Mr. O'Connor, Comptroller of the Currency, reading

as follows:

"In accordance with your recommendation, the Federal ReserveBoard approves a reduction in the common capital stock of 'TheFirst National Bank of New Bedford', New Bedford, Massachusetts,from $500,000 to ,,250,000, pursuant to a plan which providesthat the bank's capital shall be increased by sale at par of$550,000 par value Class 'A' preferred stock to the Reconstruc-tion Finance Corporation and the sale at par of 200,000 parvalue Class 'B' preferred stock to local interests, and that thefunds released by the reduction in common capital stock, togetherWith the bank's surplus and undivided profits, shall be used toeliminate estimated losses and depreciation in securities in thelower grades in the amount of at least $390,000, all as set forthin your memorandum of December 22, 1933.

"In considering the plan under which the reduction of commoncapital stock is to be effected, it was noted that no provisionwas made for the elimination of depreciation in securities aggre-Pting $127,157, which will impair the bank's common capital stockby approximately that amount. There also will remain in the bankdoubtful items aggregating $585,723, slaw items aggregatinga/450,708, and a heavy investment in banking house, furnitureand fixtures and other real estate. It is assumed, however, thatYou have these conditions in mind and that whenever it becomesfeasible to do so, you will obtain such further corrections as maybe practicable."

Approved.

Letter to jr. O'Connor, Comptroller of the Currency, reading

48 follows:

, "In accordance with your recommendation, the Federal Reserve

fcl!.rd approves a reduction in the common capital stock of theNiagara County National Bank & Trust Company', Lockport, New York,


669

12/29/33

"from $800,000 $800,000 to $500,000, pursuant to a plan which providesthat the bank's capital shall be increased by the sale at par of200,000 par value preferred stock to the Reconstruction FinanceCorporation and/or others and that the funds released by the re-duction in common capital stock, together with a portion of thesurplus and undivided profits account, shall be used to eliminatesubstandard assets and depreciation in lower grade securities inthe amount of approximately $601,936, all as set forth in yourmemorandum of December 23, 1933."

Approved.

Letter to Ur. O'Connor, Comptroller of the Currency, reading

as follows:

"In accordance with your recommendation, the Federal ReserveBoard approves a reduction in the common capital stock of 'TheManufacturers National Bank of Troy', Troy, New York, from$1,500,000 to 41,000,000, pursuant to a plan which provides thatthe bank's capital shall be increased by the sale at par of$1,000,000 par value preferred stock to the Reconstruction FingnceCorporation and/or others, and that the funds released by the re-duction in common capital stock, together with the bank's surplusand a portion of the undivided profits shall be used to eliminatesubstandard assets and depreciation in lower grade securities inthe amount of approximately $2,095,326, all as set forth in yourmemorandum of December 22, 1933."

Approved.

Letter to Mr. Case, Federal Reserve Agent at New York, reading

as follows:

"Reference is made to Assistant Federal Reserve Agent Dillis-tin's letter of December 18, 1933, transmitting the applicationof the 'Trade Bank of New York', New York, New York, for permis-sion to reduce its common capital stock from 4660,000 to 4330,000as part of a plan which also provides for the sale at per of330,000 of capital notes to the Reconstruction Firnnce Corpora-

tion and/or others and the use of the released capital funds ineliminating questionable assets.

"In view of the recommendation of your Committee, and the cor-rections to be made in the bank's condition as set forth in theinformation submitted, the Board approves the application of theTrade Bank of New York, New York, New York, for permission toreduce its common capital from 4660,000 to 4330,000 subject to thefollowing conditions:

"1. That prior to the time such reduction in capital is


670

12/29/33 -23-

"effected the bank's capital shall be increased by the saleat par of $330,000 par value capital notes to the Reconstruc-tion Finance Corporation and/or others.

"2. That the bank will maintain an amount of paid-up andunimpaired capital and unimpaired surplus of not less thanone-tenth of the average amount of its aggregate deposit lia-bilities, and in no event shall the aggregate of the commoncapital stock and capital notes be reduced below $500,000,without the consent of the Federal Reserve Board. When andif the aggregate amount of common capital stock and capitalnotes equals 0500,000 no further reduction in the amount ofcapital notes outstanding shall be made without a correspond-ing increase in common capital stock. In determining theaverage amount of aggregate deposit liabilities the periodof twelve months ending on the thirtieth day of November ineach year shall be used.

"3. That none of the funds released by the reduction incommon capital be returned to shareholders but that such re-leased capital shall be used to eliminate questionable assetsin the amount of $330,000.

"4. That the Directors' Guarantee, secured by collateralwith a value at this time of approximately $98,000, continuein full force and effect.

"5. That the transaction has the approval of the New YorkState Banking Department.

"6. That your counsel has considered the case and is satis-fied as to its legal aspects.

"It is noted that the plan does not provide for the eliminationof all the losses set up by the State examiner, and it is assumedthat your office will request that this be done as soon as it isPossible to do so."

Letter to Mr. O'Connor,

48 follows:

Approved.

Comptroller of the Currency, reading

"In accordance with your recommendation, the Federal ReserveBoard approves a reduction in the common capital stock of 'TheFirst National Bank of Morris', Morris, Illinois, from $125,000 to475,000, pursuant to a plan which provides that the bank's capitalshall be increased by the sale at par of 450,000 preferred stockto the Reconstruction Finance Corporation and that the funds re-leased by the reduction in common capital stock shall be used toeliminate substandard assets and to increase the surplus of thebank, all as set forth in your memorandum of December 23, 1933."

Approved.



671

12/29/.33 -24-

as follows:



State National Bpnk of Texarkana', Texarkana, Arkansas, from

$400,000 to $200,000, pursuant to a plan which provides that the

bank's capital shall be increased by the sale at par of :;250,000


tion, and that the funds released by the reduction in common cap-

ital stock shall be used to eliminate substandard assets and de-

preciation in investmant securities, all as set forth in your

memorandum of December 27, 1933."

Approved.

Letter to Er. O'Connor, Comptroller of the Currency, reading

us follows:



First National Bank of Granbury', Granbury, Texas, from 41C0,000

to 450,000, pursuant to a plan which provides that the bank's

capital shall be increased by the sale at par of $50,000 par

value preferred stock to the Reconstruction Finance Corporation,

and that the funds released by the reduction in common capital

stock, together with a portion of the bank's surplus and undivided

profits, shall be used to eliminate substandard assets and secur-

ities depreciation in the amount of approximately ,41,042, all

as set forth in your letter of December 27, 1933."

Letter to Er. O'Connor,

as follows:

Approved.

Comptroller of the Currency, reading



Calistoga National Bank', Calistoga, California, from $75,000 to

$25,000, pursuant to a plan which provides that the bank's capi-tal shall be increased by the sale at par of $50,000 par value

Preferred stock to the Reconstruction Finance Corporation, and

that the funds released by the reduction in common capital stock

shall be used to eliminate approximately 449,163 of substandard

assets and securities depreciation, and to increase the bank's

undivided profits account by approximately 4837, all as sot forth1 in your letter of December 27, 1933."

Approved.


672

12/29/33 -25-


as follows:



First National Bank of San Dimas', an Dimas, California, from

50,000 to ',:25,000, pursuant to a plan which provides that the

bank's capital shall be increased by the sale at par of 25,000



capital stock, together with approximately 41,619 from the

bank's surplus and undivided profits, shall be used to eliminatesubstandard assets and securities depreciation in the amount of

approximately ,j56,619, all as set forth in your letter of Decem-

ber 26, 1933."

Approved.

Letter to Er. O'Connor, Comptroller of the Currency, reading

as follows:

'In accordance with your recommendation, the Federal Reserve


First National Bank of Orange', Orange, California, from $300,000to $200,000, pursuant to a plan which provides that the bank'scapital shall be increased by the sale at par of c)50,000 par

value preferred stock to the Reconstruction Finance Corporation,

and that; the funds released by the reduction in common capital

stock, together with approximately 4)7,481 from undivided profits,

shall be used to eliminate substandard assets and securities de-

preciation in the amount of approximately .107,481, all as set

forth in your letter of December 26, 1933."

Approved.


as follows:



First National Bank of Enumclaw', Enumclaw, -4ashington, from

Na00,000 to ,50,000, pursuant to a plan which provides that the

bank's capital shall be increased by the sale at par of (g0,000

Par value preferred stock to the Reconstruction Finance Corpora-


capital stock, together with 'p16,000 from the bank's surplus, un-

divided profits mad reserves, shall be used to eliminate


673

12/29/33 -26-

"securities depreciation of approximately 6,000, all as setforth in your letter of December 27, 1933."

Approved.


as follows:

"In accordance with your recommendation, the Federal ReserveBoard approves a reduction in the common capital stock of heFirst National Bank of Toppenish', Toppenish, Washington, from:.;50,000 to 40,000, pursuant to a plan which provides that thebank's capital shall be increased by the sale at par of 20,000par value preferred stock to the Reconstruction Finance Corpora-tion, and that the funds released by the reduction in common cap-ital stock shall be used to eliminate substandard assets and se-curities depreciation in the amount of approximately $18,000 andto establish a surplus account of approximately ;2,000, all asset forth in your letter or December 27, 1933."

Approved.


an follows:

"In accordance with your recommendation, the Federal ReserveBoard approves a reduction in the common capital stock of 'Theommercial National Bank of Hillsboro', Hillsboro, Oregon, from)75,C00 to 47,500, pursuant to a plan which provides that thebank's capital shall be increased by the sale at par of %;37,500par value preferred stock to the Reconstruction Finance Corpora-tion, and that the funds released by the reduction in commoncapital stock, together with approximately ,i15,661 from the sur-plus and undivided profit accounts, shall be used to eliminatesubstandard assets and securities depreciation in the amount ofapproximately 013,161, all as set forth in your letter of Decem-ber 26, 1933.

"Since the remaining securities depreciation of 36,051, at-tention to which is called in your letter, is sufficient toimpair the common capital stock, it is assumed that whenever itbecomes feasible to do so you will obtain such further correctionsas may be practicable."

Approved.

Letter to 1,:r. O'Connor, Comptroller of the Currency, reading

fOlitYMI


674

12/29/33 -27-

"Receipt is acknowledged of your letter of December 27,1933, in regard to the proposed reduction and increase in capi-tal of the First National Trust and Savings Bank of San Diego,San Diego, California, which was approved by the Board December9, 1933.

"It is noted that your examiner has advised that it will beimpossible for the bank to meet the condition numbered two,which reads as follows:

'That the shareholders or others will make a voluntary con-tribution of $500,000 in addition to the write-down of$500,000 in common capital, and that no part of it shallhave come from the sale or liquidation of unacceptable as-sets

"In accordance with your recommendation, the Board consentsto the amendment of the foregoing condition, to read as follows:

'That the shareholders and/or others will purchase forcash assets aggregating ;?300,000, such assets to be se-lected by a national bank examiner and an examiner of theReconstruction Finance Corporation; and that earnings fromSeptember to December 31, 1933 in amount of ,200,000 willbe used to charge off a like amount of undesirable assets,but to remain the property of the bank."

Approved.


as follows:

"Receipt is acknowledged of your letter of December 27, 1933,in regard to the proposed reduction and increase in capital ofthe Commercial National Bank, Lakeview, Oregon, wherein you ad-vise that the Reconstruction Finance Corporation approved thePurchase of only 450,000 of preferred stock from that bill* in-

stead of 4100,000 as contemplated in the plan which was approvedby the Board on December 15, 1933.

"In view of the fact that the bank will still have ample cap-ital in relation to its deposits, the Board offers no objectionto the reduced amount of preferred stock, upon the understandingthat the other provisions of the plan previously approved remainunchanged."

Approved.

Letter to "The Mansfield Savings Bank and Trust Company",

Liansfield, Ohio, reading as follows:

. "This is to advise you that, effective if and when The Mans-field Savings Bank and Trust Company, Mansfield, Ohio, is


675

12/29/33 -28-

the

"converted into a national banking association and is authorized

by the Comptroller of the Currency to commence business as The

Mansfield Savings Trust National Bank, the Federal Reserve Board

approves the application filed by your bank on behalf of such

national bank for permission to act, when not in contravention

of State or local law, as trustee, executor, administrator,

registrar of stocks and bonds, guardian of estates, assignee, re-

ceiver, or in any other fiduciary capacity in which State banks:

trust companies or other corporations which come into competition

with national banks are permitted to act under the lams of the

State of Ohio, the exercise of all such rights to be subject to

the provisions of the Federal Reserve Act and the regulations ofthe Federal Reserve Board.

"After the conversion of The Mansfield Savings Bank and Trust

Company into The Mansfield Savings Trust National Bank becomes

effective and the Comptroller of the Currency authorizes the na-

tional bank to commence business, the board of directors of the

latter bank should adopt a resolution ratifying the action taken

on its behalf by your bank in making application for permission

to exercise trust powers, and it is requested that a certified

copy of the resolution so adopted be forwarded to the Federal Re-

serve Board for its records as soon as possible. Mien a copy of

such resolution has been received by the Board, a formal certifi-

cate covering the right of The Mansfield Savings Trust National

Bank to exercise trust powers will be forwarded to it."

Approved.

Telegraphic reply to a telegram dated December 28, 1933, from

Hamilton, Governor of the Federal Reserve Bank of Kansas City;

reply reading as follows*

"Contents of your telegram regarding service charge on items

handled by reserve city banks for country correspondents noted.

This matter has received consideration but Board feels that de-

cision as to whether and to what extent system of service charges

should be adopted by Federal Reserve banks should be deferred for

time being."

Approved.

Reply to a letter dated December 15, 1933, from Mr. Stevens:

Federal Reserve Agent at Chicago; the reply reading as follows:

"Reference is made to your letter of December 15, with which

you inclosed a copy of a letter from Mr. James F. Toy of Sioux

City, Iowa. It appears from Mr. Toy's letter that he is not a


Of

12/29/33 -29-

"director or officer of the Toy National Bank but that he is

an officer and director of ten other national banks, all of

which make loans secured by bonds, and that he is interested

in seven State banks. The information contained in his letter

and in your letter regarding this situation has been noted

with interest by the Board."It seems clear that Mr. Toy's directorates will come within

the provisions of section 8(a) of the Clayton Act and, as you

know, the authority of the Federal Reserve Board to issue per-

mits covering such directorates is prescribed by the provisions

of section 8 of the Clayton Act, -Much limit to three the number

of banks which may be covered by such permits. The Board has

no authority to modify or waive the provisions of section 8(a)

or to grant a permit covering a greater number of banks than

the maximum of three provided for by section 8.

"In the aircumstances, the Board regrets that it is not in

a position to offer any suggestions as to the course of action

which Mr. Toy should pursue."

Approved.

Thereupon the meeting adjourned.

1,,Lt, 17Secretary.


19331229_200p_Minutes.pdf

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