The sun. [volume] (New York [N.Y.]) 1833-1916, 1913-06-19
bank for additional deposits of security"
Banks Must Hold Reserve.

bank for additional deposits of security" "
Banks Must Hold Reserve.
Whenever any Federal reserve bank.
says the bill, shall pay out or disburse
Federal reserve Treasury notes OF the is-
su" herein produced. II shall hold in its
own vaults gold or lawful money in
amount to 33 i-3 per centum of the
Treasury notes so paid out by II. The
Federal board shall have the power In Its
discretion to require the Federal reserve
banks TO maintain on deposit in the
Treasury Of the United states Il sum of
gold or lawful money equal to . per
centum of whatever amount of Federal
reserve notes may be issued to them under
this act. but such ; per centum shall be
counted and included rs part Of the
80 la per centum reserve herein before
required 1t shall also have the right to
grant III whole or part. or 10 reject on
tirely, application " any Federal reserve
bank for Federal, r-serv" Treasury notes.
"But 10 the extent and in the amount
that such application may he granted. the
Federal reserve board shall through its
local Federal agent. deposit Treasury
notes with the bank so applying and such
bank shall be charged with III" amount Of
such notes and shall pay such rate Of
interest. or said amount as may be es-
tablished by the Federal reserve board
and tn" amount OF such Treasury notes
go issued to any such bank shall upon de
livery become a first and paramount lien
on all the assets of such bank"
May Reduce Liabilities.
Any Federal reserve bank may at
any time reduce It's liabilities for ont :
standing Federal reserve notes by the
deposit of Federal reserve notes
whether issued to such bank or to some
other member bank, other lawful
money of the United States, or gold
bullion. and such reduction shall be ac-
companied 10y "A corresponding reduc-
ton in the reserve fund If lawful
money set apart for the redemption of
said notes and ly the release of cor
responding amount of the collateral Sc
curitv deposited with the local Federal
rcscrN" agent
: Provision is made for an exchange
of collateral "f equal value with that
deposited originally for III" protection
of Federal reserve notes.
1T shall hc tn" duty Of every Federal
irs.rv. bank" says the hill. "to receive
on deposit at par and without charge for
cXchang. or collection checks and drafts
drawn by any Of It's drpositors upon any
other irpositor and checks and drafts
drawn by am, d.i'nsitor IN any other
Federal res.iv" bank upon funds to the
credit of said dcpos,'or IN said reserve
. bank last mentioned,
The Federal reserve board shall pro.
mulgatc regulations governing the
'ransfer Of funds at par among Fedora
reserve banks, and may exercise thu
; functions Of "A clearing house for such
/ Federal reserve banks. and may ais,
require each such bank To exercise the
functions of clearing house for rs
! shareholding banks.
Limit On issu~ "s NOi-s.
Section Is provides that no nationa
/ banking association shall receive OF
issue circulating notes in excess of the
! total amount Of such notes which such
bank may have outstanding AT the time
of passage Of the act. and no nationa
banking association which may reduc.
! its outstanding circulating notes shall
receive or issu" circulating notes II
excess of the SUN 70 which its out
standing notes shall have been reduced
by such withdrawal.
| Section |? provides for tn" repeal o
the law requiring national banking az
sociations before commencing bankinl
/ =.
business to deliver I" tn" Treasurer al
the United States certain amounts O.
United States registered bonds.
PROV lsion Is made in the hill for al
exchange in collateral of equal value
with that deposited originally for th'
Drot"ciio of the Federal reserve notes.
Section 90 Of tn" h!ll provides for IN.
"Xchangc Of the . per cent, bonds Of III,
h'''u states p'a'I'I "a c'fcu'a.'ol PRIV
states without tn. circulation privilege
This exchange shall be made upon ap
'pl.cation to tn, Secretary of tn. Treas