Atlanta Georgian. [volume] (Atlanta, Ga.) 1912-1939, 1914-01-20
Four Hundred and Fifty Bankers of State at
Great Rally Banquet to Boost Gate City for
Center of Federal Regional Reserve District

of the district will be located. In
other cities there will be established
branches of the reserve bank. Every
national bank In the district is re-
quired to subscribe per cent Of its
capital and surplus to the stock Of
the reserve bank. One-half of this
is to be paid in during a period of
months in cash. The rest will be sub
ject TO call.
The reserves of national banks.
from this time on, when not located
In reserve cities, are fixed at IL per
cent of their demand deposits and 5
per cent of their time deposits. Four
twelfths of this reserve permanently
will be retained in the vaults Of the
home bank: five twelfths in the re-
serve bank of the district and three
tWelfths in Its own vaults, or in the
vaults Of the Federal reserve bank,
according to the preference of the
home bank.
Supervision by Board.
"A reserve board Of seven located
in Washington will have general su
pervision over the reserve banks.
Each Federal reserve bank will be
controlled by nine directors, six of
whom will be elected by the member
banks, stockholders in the particular
Federal bank, and three appointed
by the reserve board. Two Of those
appointed by the reserve board must
be skilled in banking Three Of those
selected by the member banks can
be chosen by them without limita-
ton. The other three chosen by the
member banks must be engaged in
commerce, agriculture or some other
industrial pursuit in their respective
districts and can not be officers, d.
rectors or employees of banks.
The Federal reserve banks can
only do business with member banks
and with other Federal reserve banks,
Each Federal reserve bank will
have available to meet the money
or currency wants of the member
banks of it's district: the capital stock
paid in by the member banks, the re-
serve of member banks on deposit
with It, and such funds from time to
time as the treasury of the United
States, in cooperation with the Re
serve Board, may deposit with It.
Latitude of deposit has been given
to the Secretary of the Treasury that
the surplus funds of the Government
may be placed in that district in
which at the time they may be most
needed
The Reserve Board can permit, or
hv vote of five of the seven members,
require one Federal reserve bank to
rediscount the discounted paper of
another Federal reserve bank, thus
making II practicable to move the
surplus money of the country to the
locality in the country in which, at
the time, It is especially needed.
Reserve Agent for Each Bank.
h
operation between the banks Of the
country for the mobilizatio of the
surplus money and currency of the
country with a general board OF su-
pervision free from any interest what
ever in any bank given the power to
control the Federal reserve banks and
to compel a mobilization in the pub
lie interest.
an addition to this, at each Fed
eral reserve bank there will be sta
toned a Federal reserve agent.
Through this Federal reserve agent,
under the rules prescribed by the re-
serve board, the Federal reserve
banks can rediscount paper and OBJ
tain Federal reserve notes, these notes
being new issues intended to make
1t possible temporarily to expand and
contract currency. This feature of
under which the Bank of Germany,
the Bank of France and the Bank OF
England enlarge and contract their
paper currency to meet special needs
in their respective countries. 1t is
from this source that each bank,
properly managed, which has loaned
the money to it's depositors on good
paper to solvent debtors, has the OPP
portunity of rediscount with the re-
serve bank to meet any emergency
and to prevent the possibility of
disastrous run upon bank.
Dividend for Stockholders.
after the expense of each Federal
bank has been paid, the stockholders
are to receive an annual cumulative
dividend of per cent on the paid in
capital After the payment of this
dividend, the net earnings are to be
paid to the United States as fran
chise tax, except that one-half of the
net earnings above the 6 per cent div
idend are to be put into a surplus
fund until 1t shall amount to 40 per
cent of the paid-in capital stock OF
such bank
Ordinary discounts by member
banks with the Federal reserve banks
are limited to paper with a maturity
at the time of discount of not more
than 80 days.
TT is however. provided that paper
issued FOR agricultural purposes. having
maturity of not exceeding six months,
may be discounted in amount proper
toned to the capital OF the Federal re-