The Madisonian. (Richmond, Ky.) 1913-1914, 1913-06-24
CONGRESS GETS
CURRENCY BILL
Wide Reform Is Provided For in
New Measure.
RIGID RULES FOR BANKS
"Details Of the Proposed Law Which
Has the Endorsement Of President
WilsSsr--FederaI Board to
Have Control.

w dSulnSJOu, June 1U-- 4 ne OWcuS-
Glass-McAdoo banking and currency
bill was introduced in both houses Of
congress today.
This bill, which has the approval OF
President Wilson. may be modified In
some particulars during its considera-
ton by congress, but in most of its
features it will be the law Of the land,
lin ali probability, before the adjourn
cment of the present session of con-
gress.
Summary of Provisions.
Summarized, the bill is as follows:
The secretary of the treasury, the
attorney general, and the controller of
the currency are formed into an or
ganization committee for the purpose
of dividing the United States into not
less than IL districts, each district to
contain a federal reserve city.
In each federal reserve city the or
ganization committee will organize a
federal reserve bank
Every national bank within a re-
serve district must subscribe 20 per
cent. Of its unimpaired capital to the
capital stock of the federal reserve
bank Of that district, the capital stock
to be not less than $5,0O0,000.
Limit or Branch Houses.
Each federal reserve bank may es-
'tablish branch offices, the number of
which must not exceed one for each
100000 of the capital stock of such
federal reserve bank
Every federal reserve bank shall be
incorporated and shall have success
sion for period of 20 years from it's
organization
Every federal reserve bank shall be
controlled by board of nine direc-
tors holding Office for three years,
three of whom shall be chosen by the
: stockholding banks, three represent
Ing the general public interests of the
reserve district, and three designated
by the federal reserve board. Share
holders IN federal reserve bank shall
ne entitled to an annual dividend of s
per cent. on the paid up capital
Raising of Surplus Fund.
One-half Of the net earnings shall
be paid into the surplus fund until
that fund amounts to 20 per cent. of
the banks capital, and the remaining
halt shall be paid to the United States
When the surplus fund amounts to
20 per cent. Of the capital and the
: shareholders have received their five
per cent. dividends, all excess earn
ings shall be paid to the United
= States.
Any state bank, banking associa-
TTton, or trust company may subscribe
TO the stock of federal reserve bank.
A federal reserve board Is created
consisting of nine members, the secre-
tary of the treasury, the secretary of
agriculture, and the comptroller of the
currency, three members chosen by
the president Of the United States and
by and with, the advice and consent of
the senate, for term of six years,
one of whoIa is to be the governor, an
other the vice-governor, and the third
the secretary; and three members
chosen by the electors of the federal
reserve banks
Powers of Federal Board.
The federal board as empow-
cred:
To examine accounts and books OF
federal reserve banks.
To require or permit federal re-
serve bank to rediscount the paper of
any Of the federal reserve banks.
To establish each week or oftener q
rate Of discount which shall be mand-
-atory upon each federal reserve bank
for each class of paper
To supervise and regulate the is.
sue Of treasury notes to federal re
serve banks.
To require the removal of federal
reserve bank officials for incompe
tency, dereliction of duty, fraud
or deceit
To require the writing off Of doubt
full or 7orthless assets upon the
books and balance sheets of fedora
reserve banks.
To suspend the further operations
of any federal reserve bank and ap
point a receiver therefor
Limit of Banks Business.
federal reserve bank may re
ceive from any of its stockholders de
posits of current funds, national banl
notes, federal reserve notes or check
and drafts upon solvent banks
Upon the endorsement of any mem
her bank it may discount notes AMI
bills of exchange arising out of com
mercial transactions.
Such notes or bills, however, shall
mot be discounted for specializing pun
poses.
Various restrictions are imposed Il
reference to the extent of the loanin
power of federal reserve bank
The federal reserve board may al
thorize the reserve bank of distric
ito discount the direct obligations @
lmember banks.
Certain open market operations ar
permitted 10 reserve banks.
Fiscal Agents Of Government.
All moneys now held In the generi
fund os the treasury will be deposite
In federal reserve banks, which sha
act as fiscal agents of the government
All revenues of the government: sha