Newark evening star and Newark advertiser. [volume] (Newark, N.J.) 1909-1916, 1914-04-03

! Federal reserve organization com
mittee designating the cities in Whlcl
reserve banks are to be established
under the new currency system Au'l
| fixing the geographical limits OF lne
districts, was forwarded TO-DAY u
| each national bank and eligible IN
stitution by treasury department OF
| ficials Inclosed with the notices
were blank forms of resolutions to De
adopted by the boards of directors OF
the banks, authorizing a supserlP
ton to the capital stocks of the FED
eral reserve banks in their respective
districts.
According to the act creating the
new banking system, every natlohai
banking association shall be re-
quired within thirty days after notice
from the organization committee To
subscribe to the capital stock OF lts
reserve bank lin a sum equal 10
per cent. of the paid-up capltai
stock and surplus of such bank
what the Law STIMULATES.
The law also stipulates that one
sixth of the subscription shall De
payable on call of the organization
committee, or of the Federal lie
serve Board; one-sixth within three
months and one-s3xth within SIX
months thereafter, and the remainder
of the subscription or any part OF IL,
shall be subject to call when deemed
necessary.
With the dispatch of the notices to-
day, treasury officials prepared to re-
ceive the acceptance notifications 10
be returned by the institutions al
fected. 1t was pointed out that once
the necessary formaiities are com
pleted and the members of the Fed
eral Reserve Board appointed, the
task of organization Will practically
have been concluded and the system
put upon an operating basis.
disappointment for Congressman
Keen disappointment was apparent
today among members OF Congress
representing cities whose applications
for reserve banks We're denied Inc
Federal Reserve Board Will have
power to revise the list of cities, but
officials here do not think such ac-
ton will be considered.
The twelve cities designated as
locations for the federal reserve
banks by Secretary of the Treasury
McAdoo, Secretary of Agriculture
Houston and the controller of the
currency, John Shelton Williams, con-
stituting the organization commit
tee, are as follows: District No. 1,
Boston; District No. 2, New York
District No 3, Philadelphia; District
No. 4. Cleveland;l District No. ., Rich
mond, Va; District No. 6, Atlanta,
Ga; District No. Z, Chicago; District
No. 8, st. Louis; District No. g.,
Minneapolis; District No. 10, Kansas
City, Mo-; District No. II, Dallas,
Tex: District No 70, San Francisco.
To Name Reserve Board.
The next step toward putting the
new banking and currency system
into effect will be the nomination of
five persons, who, with the secretary
of the treasury and the controller OF
the currency, will constitute the Fed
eral Reserve Board. 1t is expected
that President Wilson will send these
nominations to the Senate early next
week.
The organization committee exer-
cised to the full the discretion vested
in it to divide the country into re-
serve bank districts. In the organic
law it is provided that there shall be
no fewer than eight districts nor
more than twelve, and in making the
larger numerical division the COM
mittee responded to a strong demand
from all parts of the country.
The act provides that the determin-
alton of the organization committee
as to the location of the Federal re-
serve banks "shall not be subject to
review except by the Federal Reserve
Board"
Rules of the Organization.
The organization committee may, at
any time, notify every national bank
in the different districts to subscribe
to the capital stock of the Federal
reserve banks. Within thirty days
after such notice they must make
such subscriptions to the extent of
six per cent. of their paid-up capital
stock and surplus. Under the law
one-sixth of this is to be paid on call
of the organization committee, one
sixth within three months, one-siXth
within six months, and the remainder
shall be subject to call when deemed
necessary by the Federal Reserve
Board, said payments to be in gold
or gold certificates"
The intent and purpose of the au-
thors of the law was to require the
banks which become members of the
system to pay in cash only one-half
the amount Of their subscriptions
during the first six months, following
the first call. The authors of the bill
did not believe that the other half of
the subscriptions ever would be called
for except in an emergency
The New York Bank.
be the Federal Reserve Bank of New
York. Its 6 per cent. stock subscrip-
ton will be $20,621, 606. The smallest
will be the Federal Reserve Bank OF
Atlanta. Its 6 per cent. stock SUBJ
scription will be $4!641, AIS.
Under the law the banks of New
York State and city will not be re-
quired to pay in their entire stock
subscription of $20,621, COG unless the
Federal Reserve Board elects to COM
pei them to do so. They must pay in,
however, S3,346 1874 of the stock sub
scription ION CALI of the organiza-
ton committee, another $3,346 934
within three months and another So
BAG, 1874 within six months after the
call.
In each of the districts all the ma
tional banks and such other banks as
| desire to join will become members
of the Federal Reserve Banking As
ISOLATION of that district. These
member banks will transact their
business through the Federal reserve
bank in their district The Federal
reserve bank is to establish branch
| banks in it's particular district. the
| branches to be operated by a board
of directors under rules and regula-
tions approved by the Federal Re-
serve Board.
| A statement prepared by the orga-
| nization committee describes the fer
ritory comprised in each district and
| gives the number of national banks
in each district which have accepted
the provisions of the reserve act. The
statement also contains the amount
| of capital stock each federal res E, y, .
| bank will have from the REQUIRED sinh