frsbog_mim_v28_0320.pdf

7/17/2019 frsbog_mim_v28_0320.pdf

http://slidepdf.com/reader/full/frsbogmimv280320pdf 1/24

PY

X-5090

February 28, 1928.

Federal

Reserve Board.

Proposed Amendments to the

Mr Wyatt, General Counsel.

Federal

Reserve Act.

In accordance with the Board's request, I respectfully submit

herewith drafts of bi l ls to effect the following proposed amendments to

the

Federal

Reserve Act:

1.

A proposed amendment to the

f irst

paragraph

of

Section 19

more clearly defining demand

deposits,

time deposits, savings

deposits,

etc. ,

and making

i t

more

difficult

to

evade

the

p r o ~ e r

classification

of deposits

for

the

purpose

of

computing reserves.

2. amendment to

Section

19 authorizing member banks in

c o ~

puting

their reserves to

deduct

balances

due from banks from their

gross demand deposits

instead

of

from balances due to

other

banks ,

as

at

present.

3. A complete rev1s1on

of Section 19 adjusting, c l a r i f ~ i n g

and

simplifying the reserve requirements in

accordance

with the proposed

plan suggested

by Mr.Smead

in

a

memorandum addressed

to

the

Board under

date of June 27,

1927

(St. 5420), a copy

of

which is attached hereto.

This

would

make

important

changes

in

the reserve

requirements

and

i t

is

suggested that

i t

should be subjected to careful

study

and

criticism

by

both the Board and the Federal

reserve

banks

before being

recommended

to Congress.

4. A proposed amendment to

Section

13

~ l i m i n t i n g

the word

agricultural from

the provision authorizing the discount of sight

and

demand

drafts secured

by

bil ls

of lading, in

order

to

eliminate

the

diff iculty

in

determining

what is , or what

is

not,

a non-perishable,

readily

marketable,

staple agricultural

product.

A

bi l l

for this pur

pose, S. 1989,

was

introduced by Senator Sheppard on January

4th and

has

already

been

reported

out

y

the Senate

Banking and Currency

Com-

mittee.

5.

A

proposed

amendment

restoring

the

jurisdiction of the

~ i t e d States District Courts over suits brought by

or

against Federal

reserve banks, Federal

Land Banks, and

Joint Stock

Land Banks.

I t is

i ~ o r t n t

to the Federal

reserve

banks

that this

amendment be obtained

at the earliest favorable opportunity, and the Treasury Department

has

requested that

Federal

Land Banks and Joint Stock Land :Banks be includ

ed.

(Letter

from

Mr Dewey dated

September 20,

1926.)

This

bi l l

would

be referred to the Judiciary Committee

instead

of the :Banking and Caf

rency

Committee, and

any

riders

amending

the

Federal

Reserve Act

would

not be germane to the purpose of the

bi l l

7/17/2019 frsbog_mim_v28_0320.pdf


-2-

X 5 0 ~ 0 32i

6. A

proposed

amcnd;nont oxc:l_ptinj:?; Fcders.l reserve banks fro n

attachment

or

garnishment proceedings

in

tho same

. nanncr as national

banks arc now exempted. This is in the form

of

an a llend.ment

to

Section 4

of

the

Federal

Reserve Act

and

nrobably

would be

referred

to

the

Banking

and Currency Com llittce.

7. A proposed runendment to Section 13 of the

Federal

Reserve

Act increasing the maximum

maturity

of advances

made

by

Federal

reserve

banks to member banks on

their

promissory notes from 15 days to 90 days

when such notes are secured. by paper eligible for rediscount

or

for

pur

chase by Federal reserve bunks. Such an amendment was recommended by

the Board

in

a let ter

addressed

to Congressman McFadden under date o f

January 16 1926 (X-4508) and a i l l containing such an amendment nas

introduced

in

the

Fifty-Ninth Congress by Congressman McFadden

as

H.R.

7894

but

was

never

reported

out

by

the

House Banking

and

Curre1my

Com-

mittee.

8.

The

prooosed

amendment to Section 8

of the

Clayton Act de

signed

to

give the Board more latitude

in

the

matter

of granting perinits

for

interlocking

bank directorates. This

proposed

amendment

has been

introduced in

the present Congress

as

H.R. 6491, has

passed

the House,

and is now in

the

hands

of

the

Senate

Comrrdttee on Banking and Currency.

9. A

proposed ~ e n d m e n t

to Section 4

of the

Federal

Reserve

Act to

permit

an officer director or erro;>loyee of a mutual savings bank

to

serve

as

a

Class

B

or

Class

C

director of

a

Federal reserve

bank.

I

understand

that in

January 1927, the Board apuroved such an amendment

but voted to withhold

any

recommendation

to

Congress unt i l the present

session.

10.

An

amendment to

Section 9 as

amended by the McFadden

Act

permitting

State member banks to have foreign

branches.

11. An amendment

permitting

the cancellation and surrender of

Federal

reserve

bank stock held by

member

banks which go

out

of the

banking

business

or cease

to fUnction

without any receiver or liquidating

agent

being

appointed

therefor.

12. n

amendment to Section

21 of the Federal Reserve Act

suggested by the Comptroller of the Currency to

provide

that the salaries

of national

bank

examiners

shall be fixed by the Comptroller of the Cur

rency instead of the Federal Reserve Board. This

has been

covered by

~ k i n

a change in

the

longer of the two

i l ls submitted

with

y

m e ~ o r a n -

~ u m of January 7th amending

Sections

9 and 21 of the

Federal

R e ~ e r v e Act.

In

deciding

whether or not to recommend such amendments in

i ts

annual report

I

respectfully

suggest tltat

the

Board give very careful

~ o n s i d e r a t i o n to the

question

whether the present is a

favorable

or safe

time

to

recommend any amendments

to

the

Federal

Reserve

Act

especially

in view of the

debates

on the nroposed amendment to the

Clayton

Act and

the Retirement Bil l

and

in view

of

the number of

pending

amendments

o

a more or

less

radical nature which have been

introduced

by

various

7/17/2019 frsbog_mim_v28_0320.pdf


-3-

I f I may be permitted to

record

my Dersonal o p ~ ; u o n on

this

matter,

I 7 0uld

say that

agree ri th

the view expressed by the omp-

t rol ler of the Currency, to ,.,.it: That i t would be impossible to

secure

constructive

legislat ion

in

connection

···ith

the Federal

Reserve System

a t the

present

time

and

the introduction of

legis la t ion

recommended by

the Board would

lead to amendments

and bearings before committees

~ h i h

would be broad

in

the i r

scope and

dangerous to the Federal

Reserve

System. I t would

also

give

the proponents of radical amendments

to

the

Federal

Reserve Act an opportunity of forcing action upon such

rad

ica l

amendments by

tacking

them on

as r iders to

any bi l l s which

might

be introduced a t the

Board s

suggestion.

i l ls attached.

WW M

2 28 28

Respectfully,

Walter Wyatt,

General

Counsel.

7/17/2019 frsbog_mim_v28_0320.pdf


COPY

X-5090Ja

L

A BILL

To

amend

Section

19 of the Federp.l F.eserve Act.

BE IT E.. IACTED BY

TH. 3 SENATE

AND

HOUSE

OF

REPnES.ENTATIVES

OF THE

UNITED STATES

OF

AMERICA IN OONGR SS

ASSEl,lBLED, That

the f i rs t

para

g r a ~ h of Section 19 of the Federal Reserve Act, as amended

be

further

amended anQ

re-enacted to read as

follows:

Bank

Reseryes

•

11

"Sec.

19.

The

term

1

demand deposits '

within

the meaning

of this act shall includa l l

deposit

balances due

to

other

banks,

bankers,

and. t rust

companies

in

the

United

States

nd

foreign

countries•

a11 cert i f ied checkS; cashier 's cheeksj

treasurer 's

checks, demand

le t ters

of

credi t , and t ravel lers '

checks

outstanding; and

l l

other

de-posits

except

1

time

de

posits '

as

hereinafter

defined,

artd deposits of public moneys

by tl1e United

Sta.tet in designated depositaries.

the term t time deposits' •.*11 thin the meaning of this

act

shali.incltide l l

'savings

a c c ~ n t s • ,

' t ime cert if icates of

de

posit1, '1>ostal savings deposits' and

~ e n

account

time de

posi ts

as hereinafter defined, except that whenever, by the

lapse

of

time

or

the

giving

of

notice of

an

intended

with

drawal, savings accounts,

time

cert i f icates of deposit, and

open

account time deposits

becowe

payable in less·

than

30

days,

such

deposits

shall

be

considered demand deposits.

11

The

term

1

savings

accounts

1

shall mean

deposits of in

dividuals and religious, charitable or similar

corporations,

in res-;>ect to which -

(1) A pass book, cert i i icate or

other

similar form of

r e c e i p ~ . delivered to

and

retained by the

depositor

or

his

assignee,

must actually be

presented

to the

bank wrenever

a

wi

thdrawal

i s

made; .

(2)

The

depositor

or his

assignee

may

t

any time be

re

quired by the

bank

to give

notice

of n intended with

drawal not

less than

thir ty days before

a withdrawal

i s rmde; nd

(3)

The

bank's

printed regulations,

accepted

by the

de

positor

include the above

requirements.

11

Depos

i t s

which are permit ted to be withdrawn by check

or

otherwise,

without the

actual

presentation

of

the

pass

book

cert if icate,

or other similar

form

of r e c e i ~ t

whenever a

with

drawal is

made shall not

be

considered

'savings

accounts' with-

7/17/2019 frsbog_mim_v28_0320.pdf


-2-

X-5090-a

in the meaning

of

this act. he retention of

the

~ s s book,

cert if icate

or other similar form of

receipt

or a d u ~ l i c t e of

same,

by

the bank

or

by

an officer,

agent

or employee

thereof,

and the presentation

of

same by the bank or by an officer,

agent

or

employee

thereof,

shal l

not

be

considered

an

actual

presentation within

the

meaning of this act. A deposit made

by one bank in another or a deposit

of

a business c o ~ o r t i o n

or

firm shal l not in any case be considered a

'savings

account'

within the

meaning of this

act.

The

term

1

time

cert if icate of

deposit ' shal l mean a de

posit evidenced by written instruments delivered ndre-

tained by the

depositor

evidencing the deposit

with

a

bank,.

either with

or

without interest ,

of a certain

sum

epecified

on the fac

of

the

cert if icate,

payable in whole or

in

~ r t

to the depositor

or

on his

order

-

(1) n a

certain date, specified

on

the cert i f icate ,

more than

thir ty

days

after the date of

the

deposit;

or

(2) After the lapse of

a certain time

subsequent

to

the

date of the cert i f icate , in no case less than thir ty

days;

or

3) After w ritten notice

which the

bank may at

i t s

-

tion require

to

be

·given a certain specified number

of

days,

.not

less

than

thirty

days

before

the

date

of

repayment;

and

(4) In

l l

cases

only upon the actual presentation

of

the

cert if icate

t

each

withdrawal for

proper

en

dorsement

or

surrender.

he

retention

of the

'cert i f icate,

or

a duplicate of

same,

by the

bank or

by

n

officer,

agent

or employee

thereof,

and

the

~ r e s e n t t i o n by the bank

or

by an officer, agent or

employee thereof shal l not be

considered an

actual

presentation

within

the

meaning

of

this

act .

A

deposit

made

by

one

bank

in

another

shal l not

in cny case

be considered a

' t ime

cert i f icate

of deposit

1

within

the

meaning

of

this act .

The

term

'postal

savings deposits,.

as used

in this act

shal l mean deposits of postal savings funds in

banks

under the

terms

of

the

postal

savings

act

apnroved

June 25, 1919, as amend

ed.

he

term

1

open account time

deposits'

as

used in

this act

shal l mean deposits not evidenced by cert if icates of deposits

or

savings

pass

books,

in

respect

to

which a

w r i ~ t o n

contract

is

entered

into

with

the

depositor t

the time the

deposit is made

providing that

neither the

whole or any part of

such deposit

may

be

withdrawn,

by cheCk or otherwise, except on a given date

7/17/2019 frsbog_mim_v28_0320.pdf


more than thirty days after the

date

of the deposit, or on

written

notice w i ~ ~ must be given by the e ~ o s i t o r a certain

specified

number

of

d ys

in

advance,

in

no

case

less

than

thirty

days. In order for deposits to

be classified

as open account·

time

deposits the

bank in which such de:9osi

ts are m de il1ll S

t

actually r e ~ ~ i r e such written notice

before permitting with-

drawals to

be made

7/17/2019 frsbog_mim_v28_0320.pdf


COPY

t 3 C

X-5090-b

An

Act .Amend Section 19 of the Federal

Reserve Act, As Amended.

BE

IT EUACTED BY THE SENATE AHD

THE

HOUSE

OF REPRE-

SEN I:ATIVES OF

THE

UNITED

STATES OF

A.\mRI CA HT CONGRESS

ASSEMBLED, That the eighth paragraph of Section 19 of

the Federal Reserve Act, as amended is further amend

ed and reenacted to read as follows:

In

estimating

the

reserve

balances required by

this Act,

member

banks

may deduct from the amount

of their

gross demand deposits the amounts

of

balances due from other banks except Federal Re

serve Banks and ·.foreign banks), cash i terns with

Federal Reserve Banks and other banks in process

of collection, checks on other banks in the same

place, and exchanges for clearing house.

7/17/2019 frsbog_mim_v28_0320.pdf


A

BILL

To

amend

Section

19

of the Federal Reserve Act.

BE IT

ENACTED

BY THE SJ\NATE ND HOUSE OF REPRESENTATIVES

OF THE UNITED STATES OF AME;RICA IN CONGRESS ASSEMBLED,

That the

f i rs t paragraph

of

Section

19

of the Federal Reserve Act, as

amended, be further amended and re-enacted to read as follows:

11

Bank

Reserves.

11

S e c ~ _}:9. ·The term 'demand deposits

1

within

the

mean-

ing of this act shall include

al l deposits

of

public

moneys

of

the United States,

al l

certified cheCks, cash

ie r s ched:s, t reasurer s checks, demand let ters of

credit , and

travellers

checks

outstanding,

and al l

other deposits except

time

deposits

1

and

·Hbank deposits

1

as hereinafter

defined.

The term

1

time deposits

1

within

the

meaning of this

act

shall

include al l

1

savings

accounts ,

1

time cer t if i-

cates

of

deposit , postal savings deposits and open

account time deposits as hereinafter defined,

EjXce:p:t

that whenever, by

the lapse of

time

or the

_giving

of

notice of

an intended withdrawal,

s v ~ n g s

accounts,

time

certificates of deposit,

and. open account time de'l?osi ts

become

payable

in

less

than

30

days,

such

deposits

shall

be c9nsidered demand deposits.

The term savings.

accounts

n

shall

mean deposits of

individuals

and religious, d1ar.itable

or

similar c o r p o r a ~

tions, in

respect to which-

· · '

• •

J

' ' • ' , .

1)

A

pass

book,

~ e r t i f i c t e or other similar

form o.:f

r ~ c e i p t delivered to and retained by the depositor

or

his assignee, must actually be presented

to

the

bank whenever a withdrawal is made;

(2)

The depositor

or his

assignee

may

at any time

be

required

by

tl )3

bank to give

notice

of an in

tend

ed

withdrawal

not less

than thi r ty

days

before

a withdrawal

is

1nade; and

(3) The bank s

printed

regulations,

accepted

by the

depositor include the above requirements.

11

Deposi

ts

which

are

permitted

to

be withdrawn by check

or

otherwise, without

the actual

presentation

of

the pass

book,

certificate,

or other

similar

form

of receipt

whenever

a withdrawal is made,

shall

not be considered savings ac

counts

1

within the

meaning

of

this act. The retention of <

7/17/2019 frsbog_mim_v28_0320.pdf


-2- X-5090c ( ~ 6 . - - , r •

L

u ~ c

the pass book,

cert if icate

or

other

similar form

of

receipt

or

a duplicate

of

same, by the

bank or

by an

officer, agent or employee thereof, and the presen

tation

of

same

by the

bank,

or

by

an

officer,

agent

or

employee

thereof,

shall not be considered

an actual

presentation withirl the meaning of this act. A de

posit made by one bank in another or a deposit of a

business corporation

or firm

shall not

in any case be

considered a savings account within the meaning of

this act.

The term

1

time certif icate of deposit

1

shall

mean a

deposit

evidenced

by written

instrument

deliver

ed

to

and

retained by the depositor evidencing the de

posit

with a

bank,

either with or without interest ,

of

a

certain sum

specified on

the f c ~

of

the certif icate,

payable

in

whole or

in part

to the

depositor

or on

his

order-

(1) On a

certain

date, specified on

the

certif icate,

more

than thi r ty

days

after tpe date of

the

do

posit;

or

(2) After the lapse

of

a certain time subsequent

to

the date

of

the certif icate,

in no

case

less

than thi r ty

days; or

(3) After written notice which

the

bank may

t i t s

option require

to

be given

a certain specified

number of days,

not less

than thirty days before

tre date

of

repayment; and

(4) In l l

cases

only upon the

actual presentation

of

the

certif icate a t each ~ r i t h d r w l for proper

endorsement

or surrender.

The

retention of the certif icate, or

a

duplicate

of same,

by

the bank

or

by

an

officer,

agent

or

employee

thereof,

and

the presentation

of

same by the bank or

by an officer,

agent

or employee thereof shall not be consider.ed an actual presenta

tion within

the

meaning of this act. A d.eposi t made by one bank

in

another shall

not in

any case be

considered

a

1

time certif icate

of

deposit

within

the m e ~ ~ i n g of this

act.

The

term

postal

savings deposits

as

used in t} :cis

act

shall

me?U

deposits of

postal savings funds in banks under

the

terms of

the postal savings act approved Ju·ne 25, 1919,

as

a.rnended.

The

term

1

ouen

account

time

deposits

as used

in

this act

shall

mean deposits not

evidenced

by.

certif icates of deposits

or

savings pass books, in respect to which a written contract is en

tered into with the depositor a t t ~ e time the

deposit

is made pro

7/17/2019 frsbog_mim_v28_0320.pdf


3

X-5090-c

withdrawn,

by check

or otherwise,

e;;;:ce·Qt

on a

given

date,

more

than

thir ty

days

after

the date of

the

_qeposi

t , or

on v1ri

t ten notice

which must be given by the depositor a certain specified number of

days

in advance, in

no

case less

than

thirty days. In order for

deposits to be classified as

lopen

account time

deyosits

the bank

in

which

such deposits are

made must actually require such written

notice

before permitting withdrawals to

be made.

The

term

lbanlc

deposits shall include

al l

deposit balances

due to

other

ba1ucs, ba1Ucers,

and trust

companies in

the

United

States

and foreign countries.

.Every bank,

banking association, and

trust

company which

is

or which becomes a member of any Federal

reserve

bank shall

establish and maintain

a

reserve consisting

of

an actual

net

balance

with the Federal reserve bank of

i ts

distr ict equal

to

not

less than thirteen per

centum

of the aggregate

amount

of

i t s

bru1k deposits, three

per

centum

of

the aggregate amount

of

i t s time

deposits, and the

following

per

centum

of the ag-

gregate amount of i t s net demand deposits:

Eanks in central reserve cit ies, 13

per

centum;

Ea11ks

in

reserve

cit ies,

9

per

centum;

and

Other banks,

7

per

centum;

PROVIDED, HOWEVER

That,

upon the

affirmative

vote of

five

members

of the Federal Reserve

Eoard, any baruc

located in

an

out-

lying

distr ict of a central

reserve

city

nay

be

permitted

to main-

tain

a

reserve balance equal to not less

than

seven or nine per·

centura of

i t s net

demand

deposits, and

any bank

located

in an

out-

lying district of

a

reserve city may

be

permitted to maintain

a

reserve balance equal to

not

less than

seven per

centum of

i t s

net

demand

deposits; .AND PROVIDED

FUR-THER,

That, in

computing

the

amounts

of

net

demand

deposits

against

which

reserves

must

be

n ~ i n t a i n e d al l member

barucs

may deduct

from the amount of

their

gross demand deposits, al l

balances

due

to

them from other

banks

(except Federal reserve

banks

and foreign

ba:.tks),

al l

cash

i

terns

deposited by them with Federal

reserve barJ].{s

and other ba..'ik:s

in

process of

collection,

al l

exchanges

for the

clearing

house,

and

a l l

checks in

other banlcs

in

the same place.

The Federal

Reserve Eoard

shall have authority to prescribe

regulations

governing the

maintenance

of

the reserves required

by this section

and

further

defining

the various classes of de-

posi

t·s

herein

mentioned.

7/17/2019 frsbog_mim_v28_0320.pdf


-4-

·X-5090-c

11

No member

bank

shall

keep

on deposit with

any

State

bank

or trust

company which

is not

a

member

bank a

sum in excess of

ten per

centum of

i t s

own

paid-up

capital and

surplus. No mem-

ber bank shall act

as

the

medium

or

agent

of a nonmember bank

in

applying

for

or receiving discounts

from a

Federal reserve

bank und er the provisions of this Act,

except

by

permission

of the

Federal

Reserve Eoard.

11

The

required balance carried

by a

member

bank

with

a

Federal

reserve bank

may

under

the regulations

and

subject

to such

penalties as may

be

prescribed by the Federal

Reserve

Eoard be checked

against

and withdrawn by such

member

bank

for the purpose

of meeting

existing

l iabili t ies:

PROVIDED

HOWEVER

That no bank

shall at any

time

make new loans or

shall

pay

any

dividends

unless and

until the total balance

required by law

is

fully restored.

National

banks or banks

organized

under

local laws,

located in Alaska or in

a dependency

or insular

possession

or any part of

the United States

outside the continental

United States may

remain nonmember banks and shall in

that

event maintain

reserves and comply

with l l the

conditrnns

ow

provided by

law regulating them; or

said

banks may

with

the

consent

of the

Reserve Eoard become

member

banks of

any one of the

reserve districts,

and

shall

in

that event

take

stock,

maintain

reserves, and be subject

to l l the

other provisions of this Act.

33

7/17/2019 frsbog_mim_v28_0320.pdf


r ~ ~ , .·

l

u i j ~

X-5090-d

70th COi'TGRESS

1s t Session

C ALEITD AR

NO

46

s 1 9 8 9 -

(Report

No. 335)

DT THE SENA':i'E OF

TF..E IDHTCD STATES

January 4, 1928.

·.r. Sheppard introduced the follovJing bi l l ; which Ylas read twice

and

referred_ to the Comr::i

t tee

on J3anldng and Currency.

February

l6(calendar

day, February 20),

1928.

Reported by

Edwards,

with amendments

(Omit the :part

struck

through

and inser t the

par t

printed

in

i ta l ic

To amend

the th i rd

paraE::raph

of

section 13 of the Federal Reserve

Act.

e i t

enacted bv the

Senate and

House

of Re-oresentativm of

the

United States

of_

.America in Congress

assem'bled,

That

the th i rd paragraph

of sect ion 13 of the Federal Resurvo Act be amended

and reenacted

to

read as

follows:

U _pon the indorsement of any of i t s

member

baDks, which

shal l

be

deemed a waiver of demand notice,

and

protest by such bank ns

to

i t s

own

indorsement

exclusively,

and

subject

to

regulations

and

li1;1i-

tat ions to be prescribed

by

the Federal Reserve :Soard any Federal re-

serve bank

may discount

or

purchase bi l l s

of exchange

payable,at s ight

or

on dernand which

are-aFawn-te-f nanee

grow out of the domestic ship-

ment or the

er2ortat ion of

nonperishable, readily marketable a g r i c u l t u r ~

a l and other staples and are

secured

by

bi l l s of

lading or other ship-

ping documents

conveying or securing t i t l e

to such

staples: Provided,

7/17/2019 frsbog_mim_v28_0320.pdf


X-5090-d

-2-

That

l l

such

bil ls

of

exchange

shall

be forwarded

promptly

for

col-

lection, and

demand

for

payment

shall

be

m de with reasonable

prompt

ness after the arrival of

such

staples

at their

destination: Provided

further,

That

no

such

bil l

shall

in

any event be held by

or

for the

account

of

a

Federal

reserve barik for a

period in

excess of

ninety

days. In discounting

such

bil ls Federal

reserve bariks

~

compute

the interest to be deducted on the basis of the

estimated

l i fe of

each

bi l l and

adjust

the discount after

payment

of

such

bil ls

to

con-

form

to the actual l i fe

thereof .

7/17/2019 frsbog_mim_v28_0320.pdf


A BILL

l.

X-5090-e

C ~ t r . . :

uuu.

To amend section 12 of the Act enti t led

An

Act to amend the Judicial

Code,

and

to further

define the

jurisdiction

of

the

circui t courts

of ap})eals and of the Supreme Court,

and

for

other purposes,

ap

proved February

13,

1925, and for

other

purposes.

Be

t enacted by

the

Senate and House of

Representatives of the

United

States of ~ e r i c a in Congress assembled, that

section

12 of the

Act

enti t led

And

Act

to

amend the·

Judicial

Code,

and to

further

de

fine the

jurisdiction

of

the

circuit

courts

of appeals

and

of the

Supreme Court, and for

other purposes, approved February 13,

1925,

be amended and

reenacted

to read as follows:

Sec. 12. That no distr ict court shall have

jurisdic

tion of any action or suit by or against any corporation

upon the ground

that

t was

incorporated

by or under

an

Act

of Congress: Provided, That this

section

shall not apply to

any suit, action,

or

proceeding brought by or against a Fed

eral

Land Bank,

Joint

Stock

Land Bank,

Federal reserve

bank

or

any

corporation incorporated

by

or

under

an

Act

of

Congress

wherein the Government of

the

United

States

is the

owner of

more

than one-half of t s capital stock.

7/17/2019 frsbog_mim_v28_0320.pdf


X-5090-f

A :SILL

To

amend

section

4

of the Federal

Reserve Act

and for other

purposes.

BE

IT

ENACTED BY TEE

SENATE

.Alffi

HOUSE

OF

REPRE-

SENTATIVES

OF

T' rt:E UNITED STATES OF AMERICA IN CONGRESS

ASSEMBLED

That the

fourth

subdivision

of

the fourth

paragraph of section

4

of the Federal

Reserve Act be

amended to read as follows:

Fourth.

To

sue

and

be sued, complain

and

defend,

in

any

court of law or equity; but

no

attachment

injunction

or execution shall be issued

against

such

bank or

t s property

before

final

judgment

in

~

suit action or proceeding in ~ State county

municipal or

United States

court.

7/17/2019 frsbog_mim_v28_0320.pdf


•

L

:·',) '

u u

X- 5090-g

A :BILL

•

o

amend section 13 of

the

Federal

Reserve

Act,

and for

other purposes.

:BE IT ZNACTED :BY TI lE SENATE Aim HOUSE

OF

REPP..ESZNTATIVES

OF THE

UNITED

STATES OF

AMERICA

IN

CONGRESS .ASSEMBLED

That the

seventh

para-

graph of section

13

of the Federal

Reserve

Act, as

amended, be amended

and reenacted to read as follows:

11

Any

Federal

reserve

bank

may make

advances

for

periods not exceeding fifteen days to i ts member b ~ s

on

their

promissory notes

secured

by

the

deposit or

pledge

of

bonds

or notes of the United States or of

bonds of the

War

Finance

Corporation, or

when auth-

orized

by the

Federal Reserve

:Board

and subject to

such conditions,

regulations,

limitations, andre-

str ict ions as the

said

board may prescribe, may

m l ~ e advances for periods not exceeding

ninety

days

to i ts member banks on

their promissory notes

secured

by

such notes, drafts, i l l of

exchange,

or

bankers

acceptances

as are

eligible

for rediscount

or

for

purchase

by Federal reserve banks

under the provi-

sions of

this

Act. All

such

advances shall be made

at

rates of interest

to be

established

by such

Fed-

eral reserve banks, subject to the review and

deter-

mination of the Federal

Reserve

Board.

7/17/2019 frsbog_mim_v28_0320.pdf


COPY

X-5090-h

70th CONGRESS

1st Session

H. R. 6491

IN

THE .SEUATE OF THE UNITED STATES

February

1 (calendar day February 2), 1928

Read twice and

referred

to the Committee on Banking and Currency

A L ~ ACT

To

amend section 8 of the Act entit led An Act to sup.plement exist-

ing laws

against

unlawful restraints and

monopolies,

n ~ for

other

purposes approved October 15, 1914, as amended.

e i t enacted by tho Senate and House

of

Representa-

tives

of

the United

States of

America

.in

Congress

assembled,

That

the l st proviso of the second paragraph

of section

8

of

the Act entitled A. 1. Act to supplement existing laws against

u n l ~ w f u l restraints and monopolies, and for

other purposes,

found in t i t le

15, chapter

1,

section 19,

United States Code

approved October

15,'

1914 as amended is amended

to read

as

follows:

And provided

further,

That nothing in

this

.Act

shall

prohibit any private banker from

being

an officer, director,

or employee of not more than two banks• banking associations,

or trust companies or prohibit any officer, director,

or

employee

of

any bank

banking association, or trust

company

or any Class A director of a Federal reserve bank, from

7/17/2019 frsbog_mim_v28_0320.pdf


l

-2-

X-5090-h

beiug

an

officer director or

e ~ ~ o y e e

of

not

more tl1an

tvro

other

banks banking

ass

ocia

tiol1S

or

trt.lS t companie.s

whotrer

organized U... lder the

10.'7S

of

the

United

States

or

any

State

i in

~ l y such caso

there is force a permit

therefor issued by

the

Feuera1 Reserve Board; and the Fed-

oral Reserve

Board is

authorized to issue

such

permit

i

in i t s

judgment

i t is not incompatible with the public

interest a:J?.d. to

revoke any

such permit '-'J henever i t

finds

after

reasonable notice

m d

opportunity

to be heard that

the

public

interest requires

i t s revocation.

Passed

the House

of Representatives

February

1

1928.

Attest:

WM TYL R PAGE,

Clerk.

7/17/2019 frsbog_mim_v28_0320.pdf


X-509D-i

A BILL

To amend

Section

4 of the Federal

Reserve

Act and for other purposes.

:BE IT ENACTED BY

TEE

SENATE .AND HOUSE OF REPRESE1lTATITIS OF T n::J UNITED

STATES OF M.iElRICA

r

cmTGRESS .ASSEI il3L:ED That

Section

4 of the Act approved

e c e ~ b e r

23,

1913 known as the Federal

Reserve Act,

as amended be further

amended by striking out that part of said section which

reads as

follows:

lio director

of

Class

::S

shall be

an officer,

director

or

employee of any bank.

11

Uo

director of

Class

C

shall

be

an officer, director,

employee or stockholder of any ba.11k.

And by substituting t ~ c r e f o r the following:

No director of Class :B shall be an officer, director,

or employee of any bank other than a mutual savings bank

not having a capital stock

represented

by shares.

Uo d i r ~ c t o r of

Class

C shall be an officer, director,

employee

or stockholder

of any batik

other

t r ~ n a mutual

savings

bank

not

having

a

capital

stock

represented

by

shares.

7/17/2019 frsbog_mim_v28_0320.pdf


A :SILL

~ ) ~ ~ ~ · ·

uuv

L

X 5090 j

To amend

section

9 of the Federal Reserve Act and

for

other purposes.

:BE IT ENACTED :BY Tr:::E SEl ATE AliD HOUSE OF REPRES:E :TTATIVES OF THE

UJ:U IillD

STATES

OF .Al.iERICA IN COliGrolSS .ASSEI,:BL:ED, That the second

para

..

5Taph of section 9 of the Federal Reserve Act be amended by changing

the period

at

the end thereof to a comma and by adding the following

words:

provid.ed however

that the

establishment

or operation of any branch or

branches

in

a foreign country

or

dependency or

insular

possession

of the United States shall not

affect

the right of any such State bank to

retain or acquire

stock in

a Federal re-

serve

bank.

7/17/2019 frsbog_mim_v28_0320.pdf


A

:SILL

nA

L

·u :j:U

X-5090-k

To amend Section 6 and

Section

9 of the Federal Reserve Act and

for other

purposes.

:83

IT

El\I .A.CTED :BY TI IID SENATE AlTD

HOUSE O:B REPRES:SliT..i>.. :: IVES OF

THE

UNIT.ED STATES OF .Al :i:ERICA

IN

CONGRESS

ASS:SM:SLED, That Section 6 of

the

Act of December

23,

1913, known

as the Federal Reserve

Act

11

be

amended and re-enacted

to read as

follows:

Sec. 6.

f

any member bank shall be

declared

insolvent and

a receiver

appointed

therefor,

the

stock

held

by i t in

said Federal

reserve

b ~ ~ shall be canceled, without impairment

of

i ts l ia-

bil i ty,

and

al l cash-paid subscriptions

on

said stock, with

one

half of one per centum per month from the period of las t dividend,

not to

exceed

the

book

value

thereof,

shall

be

f i r s t

applied

to

al l debts

of the

insolvent

member ba11k

to the

Federal reserve bank,

and the balance, i f

any, shall be paid

to the

receiver

of the in

sol

vent banl<:.

If

any national bank which

has not

gone into liquidation

as

provided in Section 5220 of the Revised Statutes and for which a

receiver

has not

already

been

appointed

for other lawful cause,

shall discontinue i ts ba1iking operations for a

period

of 60 days

the

Comptroller

of

the Currency

may,

i f

he

deems

i t advisable,

appoint a receiver

for

such bank. The stock held by the said na

tional

baruc

in

the

Federal

reserve ba11k

of

i ts

distr ict

shall

thereupon be canceled and said national bank shall receive

in

pay

ment therefor, under

regulations to

be prescribed by

the Federal

Reserve

:Soard, a

sum

equal

to

i ts

cash

paid subscriptions on

the

shares canceled and one-half of one

per

centum a month from the

period of

the last dividend, not to

exceed

the

book

value thereof,

less ~ r l iabi l i ty of such national bank to the

Federal

reserve

bank.

Whenever

the

capital stock of a

Federal reserve ~ n k is re

duced either on account of a

reduction in

capital stock of any

member batik

or of the

liquidation

or

insolvency

of

such bank

or

on

account

of

the

appointment

of

a

receiver for

a

national

bank

following

discontinuance

of

i t s banking

operations as provided in

this section,

the

board of directors shall cause to be

executed

a cert if icate

to the

Comptroller

of the Currency

showing such re

duction of

capital

stock and the amount repaid

to

such bank.

1

Sec. 2. That the

eighth

paragraph of

Section

9 of the Federal ~ e -

serve

Act as ~ e n d e d be amended and re-enacted to

read

as follows:

11

I f at any time i t

shall

appear to the Federal Reserve

:Soard that a member bank has

fai led

to comply

with

the

provisions

of

this

section

or

the

regulations of

the Federal

Reserve

:Soard

made

pursuant

thereto,

or

has ceased to exercise banking functions

without a receiver

or

liquidating agent having been appointed

there

for, i t

shall

be

within

the power

of the

board after

hearing to re

in

7/17/2019 frsbog_mim_v28_0320.pdf


2

and

to forfei t

l l

rights and privileges of membership.

he Federal

Reserve :Board may

restore

membership upon

due

proof of

compliance

with

the

conditions

i ~ p o s e

by

this section.

c ~ . l - '

l

U ~ \ ; :

X 5090 k

7/17/2019 frsbog_mim_v28_0320.pdf


4 ~ ~

X-5090-1

A BILL

To

amend

Sections

9

and

21

of the Federal

Reserve

Act

and

Section

5240 of the Revised Statutes.

:BE lT

:81T.ACTED

:BY

T}:ID

SEllAT:il AUD HOUSE OF REP?JJS]ThTT.ATIVES

OF

THE

illHTED STNL'3S

OF .AMERICA HJ

COlTG RESS .ASS: :l.::BLED,

That the

s i ; ~ t h

and

seventh ~ a r a g r a : p h s of Section 9 of

the

Federal Reserve Act, as amended,

be further ruuended to read as follows:

As a condition of membership such banks

shall likevrise

be

subject

to e x ~ i ~ t i o n s

made

by

direction

of the

Federal

Reserve

Board

or

of

the Federal reserve batik by examiners selected or ap

proved

by

the

Federal

Reserve Board.

11

Wnenever the Federal

Reserve

Board shall

approve

the ex

aminations made

by

the State authorit ies,

such examinations and

the reports thereof may be accepted in l ieu of

exruninations

made

by

examiners

selected

or approved

by the Federal

Reserve

:Board:.

PROVIDED,

nO'Ii::TI'ilTIR, That when i t deems t necessary

the Federal

Reserve

:Board may order

special

examinations by examiners

of

i t s

own

selection

and

shall in

l l

cases approve the form of the re

port. The expenses of l l examinations, other than

those made

by

State authorit ies, may, in the discretion of

the

Federal Reserve

Board, be

assessed against

the

b a 1 ~ c s

exmainod and, when so

as

sessed,

shall

be

paid

by

the

banks examined. Copies

of the

reports

of such exarninatio'ns may, in the discretion

of

the

Federal

Re-

serve Board, be furnished to

the State authorities

having

super

v1s1on of such banks, to officers, directors or receivers of such

banks, and to any other proper persons.

Sec. 2. That Section 21 of

the

Federal Reserve Act be

amended to read

as

follows:

BANK EXAldN.ATIOUS.

Sec.

21.

Section fifty-two hundred and forty, United States

Revised

Statutes, is amended to read as

f o l l o ~ s :

The

Comptroller

of the Currency, with the

approval

of

the

S e c r e t a ~ J

of

the

T+easury,

shall

appoint

examiners

who shall

e ~ -

amine·every

national bank t least twice

in

each

calendar

year

and oftener i f considered necessary.

The

examiner making the

examination

of any national bank shall have power to

make

a thorough

exan1ination of l l

the

affairs of the bank,

and

in doing so he

shall have power to a ~ i n i s t e r oaths

and

to examine

any of

the

officers

and

agents

thereof

under

oath and

shall make a

full and

detailed

report of the condition of

said

bank to

the Comptroller

of

the

Currency.

7/17/2019 frsbog_mim_v28_0320.pdf


X-5090-1

2

t

c ~ 4 . .

·

u

The Comytroller of the Currency shall fix

the salaries

of

al l

national

bank exaLJ.iners

and

malce

report thereof

to

Congress.

~ 1 e

expense of

the

exruninations herein provided for shall be

assessed by the Comptroller of

the

Currency upon

the

ba:nks exarnined

in proportion

to

assets or

resources

held

by

the

ba1iks

u ~ o n the

dates

of

exanh1.ation

of

tho

vttrious banks.

I11

addition

to

the

examinations of national

ba1iks

ma O e and

cor.ductod by the

Comptroller of the Currency

evcr3r Federal

re-

serve ba11 k may, with

the approval

of tho

Federal

reserve agent or

the

Federal

Reserve 3oard provide

for

special e x a m i 1 1 ~ t i o n

of

member banks

within i t s

district

The e ; ; ~ J e n s e of

such

examinations

may, in the

discretion

of the Federal

Reserve

:Board, oe

assessed

against

the

banks exrudned

and, when so

assensed

shall

be

paid

by

the

baru;:s exmnined. Such

examinations shall

be so

conducted

as to inform the Federal reserve

bank of

the condition

of

i t s

member

banks

and

of the lines of credit which are being

extended

by them.

Every

Federal reserve

bank

shall a t

al l

times furnish to

the Fe

eral

Reserve

:Soard such information as

ma;y· be dema:1ded concerning

the

condition of any

member

barik within

the

distr ict

of

the

s id

Federal reserve

bank.

Uo

bailie

shall

be

subject to

any

visi tatorial

powers

other

than such

as

are

authorized by law,

or

vested

in

the

courts

of

justice or

such

as shall be

or

shall have

been

exercised or -

rected by Congress

or

by

either

Eouse thereof

or 3T

any

comrni t tee

of

Congress

or o either

House

duly authorized.

The Federal Reserve :Board shall at

least

once each year

order

an

e x w ~ i n a t i o n of each Federal reserve bank,

and

upon joint

application

of

ton member

o a 1 u ~ s

the

Federal

Reserve Board

shall

order

a

spacial

examination

and report of the

condition

of any

Federal

reserve

b a ~ ~ n

Date post:	06-Jan-2016
Category:	Documents
Upload:	fedfraser
View:	214 times
Download:	0 times

frsbog_mim_v28_0320.pdf

Documents