FEDERAL RESERVE BOARD WASHINGTON

A D D R E S S OFFICIAL C O R R E S P O N D E N C E T O T H E FEDERAL R E S E R V E B O A R D

October 23, 193^ B-1025

SUBJECT: Call Condition Reports of State Bank Members and their A f f i l i a t e s

Dear Sir:

There have been forwarded to you today under separate cover the

indicated number of copies of the f ive forms and schedules attached

hereto, for the use of State bank members and their a f f i l i a t e s in sub-

mitting reports as of the next cal l date:

Number of copies Form

Form 105, Report of condition of State bank member.

Schedule "0", Loans and advances to a f f i l i a t e s and irvAstmmnts in and loans secured by obligations of a f f i l i a t e s .

Form 220; Report of a f f i l i a t e or holding company a f f i l i a t e .

Form 220a, Publisher's copy of report of a f f i l i a t e or holding company a f f i l i a t e .

Form 220b, Instructions for preparation of reports of a f f i l i a t e s and holding company a f f i l i a t e s .

Kindly mail to each State bank member that has not been formally

placed in liquidation or receivership or possession of which has not

been taken by a conservator or other State o f f i c i a l 3 copies of Form

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

- 2 - ; 546 105 and Schedule "0" and an appropriate number of Forms 220, 220-a" acid

220-b, based on the number required at the time of the l a s t c a l l for

reports , with the request that the forms and the accompanying schedule

be held pending a c a l l for reports thereon. Member banks should be

ins tructed to submit the reports in duplicate , both the or ig ina l and

dupl icate copies to be signed and f u l l y executed. The o r i g i n a l s of

the reports should be retained for the f i l e s of your bank and the

copies forwarded to the Federal Reserve Board.

A number of changes have been made i n Form 105, a l l of which a r e

b e l i e v e d to be s e l f - e x p l a n a t o r y . However, i t i s sugges ted t h a t , i n

t r a n s m i t t i n g t h e forms to S t a t e bank members, you c a l l t h e i r a t t e n t i o n

to the fo l lowing :

Item 3 of A s s e t s has been amended to read "United S t a t e s Govern-

ment o b l i g a t i o n s , d i r e c t and /or f u l l y gua ran t eed" . As i n d i c a t e d by

Schedule F, t he i tem should inc lude not only the d i r e c t o b l i g a t i o n s of

t h e United S t a t e s Government h e r e t o f o r e r e p o r t e d as Uni ted S t a t e s

Government s e c u r i t i e s , but a l s o o b l i g a t i o n s of t h e Recons t ruc t i on F in -

ance Corporat ion, the Federa l Farm Mortgage Corpora t ion , and the Home

Owners Loan Corporat ion, guaranteed by the Uni ted S t a t e s Government as

to bo th i n t e r e s t and p r i n c i p a l . Home Owners Loan Corporat ion 4 percent

bonds, which a r e guaranteed by the United S t a t e s Government as t o i n -

t e r e s t only, should be inc luded in Asset i tem 4 and shown a g a i n s t i tem

1 - a of Schedule G.

L i a b i l i t y i tem 23, "Obl iga t ions on i n d u s t r i a l advances t r a n s f e r r e d

to Federa l Reserve bank", has been added, a g a i n s t which S t a t e bank mem-

b e r s should r e p o r t t h e i r l i a b i l i t i e s on i n d u s t r i a l advances d iscounted

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

: 517, - 3 -

with or sold to the Federal Reserve bank under the provisions of Sec-

tion 13b of the Federal Reserve Act, as amended June 19, 193*+. De-

tai led instructions regarding the reporting of such l i a b i l i t i e s were

contained in the Board's le t ter X-80U6 of October 6, 1 9 3 w h i c h you

were requested to send to a l l State bank members.

Liability item 29, "Dividends declared but not yet payable, and

amounts set aside for dividends not declared and for accrued interest

on capital notes and debentures", has been added, against which should

be reported: (1) Dividends declared on or before the date of the call

report but not payable until after such date, which have heretofore

been required to be included in "Other l i a b i l i t i e s " ; and (2) Amounts

that have been set aside from undivided profits for dividends not yst

declared either on preferred or common stock and/or for accrued in-

terest on capital notes and debentures.

Item 6 of Schedule S has been amended so as to provide that loans

described in Section 50^b of the National Housing Act should not be

classed as real estate loans for the purpose of condition reports on

Form 105. Such loans should be included in "All other loans", item 8

of Schedule E. The pertinent provision of Section 505b of the National

Housing Act reads as follows:

"Loans made to finance the construction of residential or farm buildings and having maturities of not to exceed s ix months, whether or not secured by a mortgage or similar l i en on the real estate upon which the residential or farm building i s being constructed, shall not be considered as loans secured by real estate within the meaning of this section but shall be classed as ordinary commercial loans".

The item "Deposits the payment of which has been deferred beyond

the time originally contemplated, either by agreement with depositors

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

- 4 - a 548 or otherwise", which appeared in Schedule L of the last condition re-

port, has been eliminated. Any such deposits held by a State bank

member should be included in the aporcoriate item of Schedule J , K

or L, depending on their character and maturity on the date of the

condition report.

It i s requested that as promptly as practicable after the issue

of the call you inform the Board, with respect to each State whose

capital city l i e s in your d i s tr i c t , whether or not State authorities

issued a call for condition reports as of the same date as the cal l

issued by the Board, and, i f not, the date of the nearest cal l thereto

issued by the State authorities. In case reports submitted in response

to such calls were not required to be published, information i s re-

quested as to the nearest date when publication of such reports was

required.

If you are sat i s f i ed that additional time i s needed for the pre-

paration of the report of any a f f i l i a t e , you are authorized on behalf

of the Federal Reserve Board to grant an extension of not to exceed

20 days, in addition to the original period of 10 days from the receipt

by the member bank of the cal l for the report. Please furnish the

Board with a copy of each le t ter granting an extension of time.

Very truly yours,

Chester Morrill, Secretary.

Inclosures.

TO ALL F3DERAL HESERVE AGENTS Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis