The Bridgeport evening farmer., 1915-01-20
0N IN FEDERAL RESERVE, BANK IS
 THERE TO STAY
Only Way to Leave Is Ky Ranks Winding Up Its Af- fairs Through Li-
 q1lidati0n-

Tn response to 3 number of re- quests, Thomas B Patton, gM11raa counsel of the Arner4ean Baukerg association. has prepared an opanaon on the question whether . stats Bank or trust company w14ch has bsnnune member of federal re-s seMva bank can. otaaersuaas than by voluntary hau1daxion, withdrew fFozn meznbershlps should such Wxthz71 asVa1 be deemed desirable for it's buai- neas ts1ssTasts. After giving the mat ter careful study; Mir. Patton reached the conr1ualon that if q state bank or E-ust 0onpany once j0inS x the system by sz1bseEfbing to it's stock, 1t cannot withdrew except through voluntary HdzaRdatton and closing up of it's aHairs or by pryoking an ex- pulsion by uon-compliance with the requirements of the federal reserve act 1dr. Patton is quoted in the New York Journal of Commerce as say members should have the right to, strrender their stock and with draw after once entering the system and suggests that the federal reserve act be amended to this end
 By Way Of Ldquidafion-
 A member bank whether state eF nattonaI can. says MT. Patton,
 
 stock and receive payment tharefor under rexulakfons to be pFescffbed by the federal reserve board (Sec. 69s or if member bank is de- c1ared lhsolVent and receiver is appointed, its stock in the federal reserve hank will be cancelled and payment tnersfor nads to the re- eeiver as provided in the act fSec. 69$ or K a state bank f1aa am Der fails to comply with the provisions Of 4 a 1nemberss or with regulations of the 1edera1 neBsrve board. such board is given power 60 compel as1rrentEer of itA stock and make repayment here for snsp9nAtng @ said band from privileges sf members hi D. and may 13rowided an that section But " fa4ae the oct as ahcwus contains provls- zons ltndef which "a national or state bank Eiennh CT may itndraw from the gyE&ega through EzOlantary liq1id- alton er will necessarily drop out when # becomes insolvenf, or ff as state bank member may be virtUalIy' expelled or auspended by the federal rserve board for non-co1np lance with requiRennenks there Is no pro- vision in the aet which applies to or covers the situation where soI- vent stnke bank member, without tn .. nec&ssity ofssgoiug into Hquidation s n1aght deaiEe to return stsA stock and 1eav tho system.
 Gaaamut Manufacture FsssIes
 The act being destitute Of any sx- press ptoyision permit ttlng state bank and truet Company mernber to sl1T4 render their stock and s's wit n eiI savT from their federal reserve bank it remains to be considered whether. there is anything in the act which would auth ortze CT ernpower. tn e ! federal reserve board to make rules aq1f5 44ivSsy <s7Sy erntnE T1thdrawaIs by solvent state bank and trust company members. If Bslch power can De found in the aet 1t Nould negative the conclusion of expreaz provision to deny tn II ght pE WtthdraNa1; otherwise it must doIlo7F fg1ef no right Of with draual being e3pressly provided In the act nor auth0ffE Ey to confer Such right being vested in the federal 1sseserve board, zle Tight does nos exist
 here does not seem to be any thing 1n seot1on which would give the federal reserve board. power to make rules and regulations per hitting the with hdrawaI of State Bank or trust company Il1ennber and pfoviding for the return ana can ce1atton of It's stock and repayraeIl Tt tftere1or. There is a power of ex- pdlston. but this only on condition that state bank member has failed 1 be poesfb1e for state bank which desires tp withdraw to- adopt the expedtsut Of non-cornp liance with some reuuirement Of the law and seek eompulsory ejecfment, but this Is nof t1ie question under scsnssff5faF- afton- There is certainly noth hing in those provisions of the section which give the federal reserve board power to require state bank mem, Der to surrender its. stock upon no. c6nnpIiance with the law which con1t be construed as giving it power tt permit the surrender qf stock ans NithdEawaI by solvent state sbani members when the law is fully com pied with.
 Treats All Alike.
 I-fle law provfdes for treatir1i all sIarehoIders alike and as stool issued and paid for by a state banl must De under the same rules an, banks. ana as no rules pern1ittin, y1ithdrawaIs can be framed for ma ffonal banks, it would seem elea that the federal reserve board wouI, have no power or authority to pro vide rules and regulations unde which solvent state banks could sur render their stock and Wi thdr avv iron the federal reserve banks.
 State banks and trust cornpanie tares of course, the creations of stat laws which define and limit thei powers, and iu some of the state enabling statutes have been passe swing such banks the power ito sub scribe to stock in the Federal Re lserve bank but the states could no of course, provide any conditions a to withdrawal which would be bind ing on the federal reserve banks
 Big Rubber Sale
 rse Sx,7EiIIs FstsSs.iss and R 1lE,t,e.r. 4,S. tl.1z sat1-affleAIri sI1c..rir,