Whereas some of said securities originally deposited as aforesaid have been from time to time withdrawn and other securities of equal value and approved by the said commissioner of banking have been deposited with the State treasurer of the State of Wisconsin; and Whereas said bank has never done any business whatsoever as trustee, etc., or in any other fiduciary capacity, and is not now acting as trustee, etc., or in any other fiduciary capacity, and has no funds in its possession as trustee, etc., or in any other fiduciary capacity, and does not intend to do any business as trustee, etc., or in any other fiduciary capacity; and Whereas it is the judgment of the directors of said bank that it surrender to the Federal Reserve Board of Washington, D. C., and to the State Banking Department of the State of Wisconsin its permit and authority heretofore granted as aforesaid authorizing it to act as trustee, etc., or in any fiduciary capacity, and that this bank petition the said board and the said banking department to cancel the said permits heretofore issued to it and revoke its authority to act as trustee, etc., or in any other fiduciary capacity; now, therefore, be it Resolved, That the president or vice president and the cashier of the National Bank of Wis., forward to the Federal Reserve Board of Washington, D. C., and to the State Banking Department of the State of Wisconsin, and to the State treasurer of the State of Wisconsin, certified copies of this resolution. That the president or vice president and the cashier of this bank surrender to the Federal Reserve Board of Washington, D. C., for cancellation or revocation the permit heretofore issued to it on or about the 24th day of November, 1925, and request said Federal Reserve Board to cancel and revoke said permit. That the president or vice president and the cashier of this bank surrender to the State Banking Department of the State of Wisconsin for cancellation or revocation any permit heretofore issued by said State banking department authorizing this bank to act as trustee, etc., or in any other fiduciary capacity, and request said State banking department to cancel and revoke said permit. That the president or vice president and the cashier of this bank petition the treasurer of the State of Wisconsin for the return to this bank of the securities deposited with the treasurer of the State of Wisconsin pursuant to section 223.02 of the Wisconsin statutes. That in the event said securities are not returned to this bank by the State treasurer of the State of Wisconsin upon due request for the return thereof, then the executive officers of this bank are authorized to institute legal proceedings on behalf of this bank against the State treasurer of the State of Wisconsin, the commissioner of banking of the State of Wisconsin, and any other necessary parties to compel the return of said securities to this bank. In conformity with section 2a, of Rule XIII, of the House Rules, there is herewith printed section 11 of the Federal reserve act, as it will read with the amendment proposed in this bill, such amendment being printed in italics, as follows: SEC. 11. The Federal Reserve Board shall be authorized and empowered: (a) To examine at its discretion the accounts, books, and affairs of each Federal reserve bank and of each member bank and to require such statements and reports as it may deem necessary. The said board shall publish once each week a statement showing the condition of each Federal reserve bank and a consolidated statement for all Federal reserve banks. Such statements shall show in detail the assets and liabilities of the Federal reserve banks, single and combined, and shall furnish full information regarding the character of the money held as reserve and the amount, nature, and maturities of the paper and other investments owned or held by Federal reserve banks. (b) To permit, or, on the affirmative vote of at least five members of the Reserve Board to require Federal reserve banks to rediscount the discounted paper of other Federal reserve banks at rates of interest to be fixed by the Federal Reserve Board. (c) To suspend for a period not exceeding thirty days, and from time to time to renew such suspension for periods not exceeding fifteen days, any reserve requirements specified in this act: Provided, That it shall establish a graduated tax upon the amounts by which the reserve requirements of this act may be permitted to fall below the level hereinafter specified: And provided further, That when the gold reserve held against Federal reserve notes falls below forty per centum, the Federal Reserve Board shall establish a graduated tax of not more than one per centum per annum upon such deficiency until the reserves fall to thirty-two and one-half per centum, and when said reserve falls below thirty-two and one-half per centum, a tax at the rate increasingly of not less than one and one-half per centum per annum upon each two and one-half per centum or fraction thereof that such reserve falls below thirty-two and one-half per centum. The tax shall be paid by the reserve bank, but the reserve bank shall add an amount equal to said tax to the rates of interest and discount fixed by the Federal Reserve Board. (d) To supervise and regulate through the bureau under the charge of the Comptroller of the Currency the issue and retirement of Federal reserve notes, and to prescribe rules and regulations under which such notes may be delivered by the comptroller to the Federal reserve agents applying therefor. (e) To add to the number of cities classified as reserve and central reserve cities under existing law in which national banking associations are subject to the reserve requirements set forth in section twenty of this act; or to reclassify existing reserve and central reserve cities or to terminate their designation as such. (f) To suspend or remove any officer or director of any Federal reserve bank, the cause of such removal to be forthwith communicated in writing by the Federal Reserve Board to the removed officer or director and to said bank. (g) To require the writing off of doubtful or worthless assets upon the books and balance sheets of Federal reserve banks. (h) To suspend, for the violation of any of the provisions of this act, the operations of any Federal reserve bank, to take possession thereof, administer the same during the period of suspension, and, when deemed advisable, to liquidate or reorganize such bank. (i) To require bonds of Federal reserve agents, to make regulations for the safeguarding of all collateral, bonds, Federal reserve notes, money or property of any kind deposited in the hands of such agents, and said board shall perform the duties, functions, or services specified in this act, and make all rules and regulations necessary to enable said board effectively to perform the same. (j) To exercise general supervision over said Federal reserve banks. (k) To grant by special permit to national banks applying therefor, when not in contravention of State or local law, the right to act as trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver, committee of estates of lunatics, 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 laws of the State in which the national bank is located. Whenever the laws of such State authorize or permit the exercise of any or all of the foregoing powers by State banks, trust companies, or other corporations which compete with national banks, the granting to and the exercise of such powers by national banks shall not be deemed to be in contravention of State or local law within the meaning of this act. National banks exercising any or all of the powers enumerated in this subsection shall segregate all assets held in any fiduciary capacity from the general assets of the bank and shall keep a separate set of books and records showing in proper detail all transactions engaged in under authority of this subsection. Such books and records shall be open to inspection by the State authorities to the same extent as the books and records of corporations organized under State law which exercise fiduciary powers, but nothing in this act shall be construed as authorizing the State authorities to examine the books, records, and assets of the national bank which are not held in trust under authority of this subsection. No national bank shall receive in its trust department deposits of current funds subject to check or the deposit of checks, drafts, bills of exchange, or other items for collection or exchange purposes. Funds deposited or held in trust by the bank awaiting investment shall be carried in a separate account and shall not be used by the bank in the conduct of its business unless it shall first set aside in the trust department United States bonds or other securities approved by the Federal Reserve Board. In the event of the failure of such bank the owners of the funds held in trust for investment shall have a lien on the bonds or other securities so set apart in addition to their claim against the estate of the bank. Whenever the laws of a State require corporations acting in a fiduciary capacity, to deposit securities with the State authorities for the protection of private or court trusts, national banks so acting shall be required to make similar deposits and securities so deposited shall be held for the protection of private or court trusts, as provided by the State law. National banks in such cases shall not be required to execute the bond usually required of individuals if State corporations under similar circumstances are exempt from this requirement. National banks shall have power to execute such bond when so required by the laws of the State. In any case in which the laws of a State require that a corporation acting as trustee, executor, administrator, or in any capacity specified in this section, shall take an oath or make an affidavit, the president, vice president, cashier, or trust officer of such national bank may take the necessary oath or execute the necessary affidavit. It shall be unlawful for any national banking association to lend any officer, director, or employee any funds held in trust under the powers conferred by this section. Any officer, director, or employee making such loan, or to whom such loan is made, may be fined not more than $5,000, or imprisoned not more than five years, or may be both fined and imprisoned, in the discretion of the court. In passing upon applications for permission to exercise the powers enumerated in this subsection, the Federal Reserve Board may take into consideration the amount of capital and surplus of the applying bank, whether or not such capital and surplus is sufficient under the circumstances of the case, the needs of the community to be served, and any other facts and circumstances that seem to it proper, and may grant or refuse the application accordingly: Provided, That no permit shall be issued to any national banking association having a capital and surplus less than the capital and surplus required by State law of State banks, trust companies, and corporations exercising such powers. Any national banking association desiring to surrender its right to exercise the powers granted under this subsection, in order to relieve itself from the necessity of complying with the requirements of this subsection, or to have returned to it any securities which it may have deposited with the State authorities for the protection of private or court trusts, or for any other purpose, may file with the Federal Reserve Board a certified copy of a resolution of its board of directors signifying such desire. Upon receipt of such a resolution, the Federal Reserve Board, after satisfying itself that such bank has been relieved in accordance with State law of all duties as trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver, committee of estates of lunatics or other fiduciary, under court, private, or other appointments previously accepted under authority of this subsection, may, in its discretion, issue to such bank a certificate certifying that such bank is no longer authorized to exercise the powers granted by this subsection. Upon the issuance of such a certificate by the Federal Reserve Board, such bank (1) shall no longer be subject to the provisions of this subsection or the regulations of the Federal Reserve Board made pursuant thereto, (2) shall be entitled to have returned to it any securities which it may have deposited with the State authorities for the protection of private or court trusts, and (3) shall not exercise thereafter any of the powers granted by this subsection without first applying for and obtaining a new permit to exercise_such powers pursuant to the provisions of this subsection. The Federal Reserve Board is authorized and empowered to promulgate such regulations as it may deem necessary to enforce compliance with the provisions of this subsection and the proper exercise of the powers granted therein. (1) To employ such attorneys, experts, assistants, clerks, or other employees as may be deemed necessary to conduct the business of the board. All salaries and fees shall be fixed in advance by said board and shall be paid in the same manner as the salaries of the members of said board. All such attorneys, experts, assistants, clerks, and other employees shall be appointed without regard to the provisions of the act of January sixteenth, eighteen hundred and eighty-three (volume twenty-two, United States Statutes at Large, page four hundred and three), and amendments thereto, or any rule or regulation made in pursuance thereof: Provided, That nothing herein shall prevent the President from placing said employees in the classified service. (m) Upon the affirmative vote of not less than five of its members, the Federal Reserve Board shall have power to permit Federal reserve banks to discount for any member bank notes, drafts, or bills of exchange bearing the signature or indorsement of any one borrower in excess of the amount permitted by section 9 and section 13 of this act, but in no case to exceed 20 per centum of the member bank's capital and surplus: Provided, however, That all such notes, drafts, or bills of exchange discounted for any member bank in excess of the amount permitted under such sections shall be secured by not less than a like face amount of bonds or notes of the United States issued since April 24, 1917, for which the borrower shall in good faith, prior to January 1, 1921, have paid or agreed to pay not less than the full face amount thereof, or certificates of indebtedness of the United States: Provided further, That the provisions of this subsection (m) shall not be operative after October 31, 1921. O PERMITTING OFFICERS, DIRECTORS, OR EMPLOYEES OF MUTUAL SAVINGS BANKS TO SERVE AS DIRECTORS OF FEDERAL RESERVE BANKS IN CLASS B MAY 26, 1930.-Referred to the House Calendar and ordered to be printed Mr. MCFADDEN, from the Committee on Banking and Currency, submitted the following REPORT [To accompany S. 4079] The Committee on Banking and Currency, to whom was referred the bill (S. 4079) to amend section 4 of the Federal reserve act, having considered the same, report favorably thereon with the recommendation that the bill do pass without amendment. The enactment of this legislation is desired by the Federal Reserve Board. The purpose of this bill is to amend section 4 of the Federal reserve act permitting an officer, director, or employee of a mutual savings bank to serve as a class B director of a Federal reserve bank. Appended hereto and made a part of this report is the letter of Gov. R. A. Young of the Federal Reserve Board to the chairman of your committee under date of February 18, 1930, fully explaining the purpose of this bill and recommending its enactment, as follows: FEDERAL RESERVE BOARD, Hon. LOUIS T. MCFADDEN, House of Representatives, Washington, D. C. SIR: The Federal Reserve Board wishes to call attention to the desirability of an amendment to section 4 of the Federal reserve act which would permit an officer, director, or employee of a mutual savings bank to serve as a class B director of a Federal reserve bank. A draft of a bill for this purpose is respectfully submitted herewith. The Federal reserve act contemplates that class A directors of Federal reserve banks shall represent member banks; that class B directors shall represent the commercial, agricultural, and industrial interests of the community; and that class C directors shall represent the general public. In order to prevent member banks from having a disproportionate representation on the boards of directors of the Federal reserve banks, all officers, directors, or employees of banks are specifically made ineligible to serve as class B or class C directors. The Attorney General rendered an opinion several years ago to the effect that mutual savings banks are banks within the meaning of the provision prohibiting Federal reserve |