Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1913-12-31
NO new CHARTERS
Necessary for Banks in Fed
eraI Reserve System.
Committee Suggests Be Well TO
"Sound The Stockholders"
Two Weeks OF Strenuous Work Map
ped Out In Tour Of Country.

Washington, Dec. 30.-Banks which
enter the federal reserve system do not
need to take out new charters, but
both state and national banks become
members by making proper applica-
| ton and .bya becoming stockholders in
federal reserve banks, according to a
regulation issued today by the reserve
bank organization committee. In its
announcement the committee declares
also that action by a board Of direc-
tors is deemed sufficient to bring
bank into the new system, but advises
that banks which wish to be on the
safe side may sound out their stock
holders. The regulation reads as fol-
lows:
1.-THE federal reserve act provides
for membership of banks operating un-
der state charters as we'll as MEM
bership of national banks. No new
charter Is contemplated in either case.
Eligible banks become members by
becoming stockholders in federal re-
serve banks, when their applications
have been properly approved and stock
has been allotted to them. Such sub.
scription to the capital stock of the
federal reserve bank appears to be a
matter within the province of the
board of directors of the subscribing
bank The organization committee
therefore deems it unnecessary to re-
quire as condition precedent to mem
bership that the stockholders should
| take any formal action.
"Inasmuch, however, as the stock
holders of bank have the legal right
by necessary vote to force a solvent
bank to liquidate and, if dissatisfied
with the action of the board in be-
coming members they might exercise
this prerogative, banks desiring to
take the precautionary measure of
canvassing the sentiment of the stock
holders, may, by resolution of their
boards, submit the question to the
| stockholders, either at the next regu-
lar meeting or at a specially called
meeting. This course is not however,
insisted upon by the organization COM
mittee.
Those national banks passing reso-
lutions Of non-acceptance on or before
Feb. %. 1914. should, as soon there
after as convenient and before the ex-
piration of the IL months prescribed
in the federal reserve act, submit their
action to the stockholders for confir-
nation, since non-acceptance of the
provisions of the federal reserve act
will ultimately involve the liquida-
ton of such national bank"
When the reserve bank organiza-
ton committee begins its tour of the
country next week, it will hold hear
| ings morning and afternoon, six days
week, make 500 mile railroad jumps
overnight and in the odd moments
| aboard trains will boil down testimony
taken at hearings.
The committee has less than two
| months to complete it's work, in which
1t will visit IA cities and spend week
or more in Washington, giving hear
ings.
Endorsements of candidates for po-
sitions on the Federal Reserve Board
are pouring in at the White House
but are not going forwsrd to Presi-
dent Wilson at Pass Christian Many
direct applications for positions and
scores of letters and kilograms en-
| dorsing fairly well-known bankers or
business men have been received. The
attitude of President Wilson's close
friends, however, which is reflected by
practically all members of Congress-
has been to leave the President en-
tirely free in the selection Of his ap-
pointees.
In a letter to Sec. Tumulty today
the President wrote that he was en-
joying complete rest and relief from
official duties.