Evening star., 1962-09-19

AAC SE-uleuQO6T group Inc
three attorneys specializing in
bank law and a selection of
National Bank officers and was
appointed by Controller of the
Currency James j. Saxon last
February /.
Its report wasB received by
President John F. Kennedy at
a brief White House ceremony
and discussed at a Treasury
press conference by Mr.. Saxon.
Transfer Proposed
The report recommended
legislation to accomplish these
purposes:
/. Transfer to the Controller
all supervisory, examination
and regulatory authority relat-
ing to the operation of Ma
tionai Banks. and all authority
relating to the formation and
expansion of bank holding
companies.
Q. Transfer to the Federal
Deposit Insurance Corp. all
Federal supervisory, examina-
ton and regulatory authority
over insured State chartered
banks.
3. a.'Reorganize the FDIC under
q single administrator and
transfer its functions to the
Department of the Treasury.
4. Divest the Federal Reserve
Board of all nonmonetary func-
tions by confining its opera
tions to the administration of
Regulations A, B, c, D, E, G, |
j. and N: with regulations G
and j to be carried out without |
regard to membership in the
Federal Reserve System.
IS. Relinquish to the individ-
ual State bank supervisory
agencies final authority TO ap-
prove branches of State-char-
tered banks.
g. Transfer to the Secretary
Of the Treasury responsibilities
for administration of Regula-
ttons @. T. and U.
: 1,5OO Banks Questioned |
The report, entitled National
Banks and the Future" was
compiled after study of ma
teTiar from 1900 national |
banks who were requested to
suggest changes. Frank E.
Mckinney, board chairman Of
the American Fletcher National
Bank & Trust Co. Of Indian
apolis. Ind, headed the conf
mittee.
The report urged that limits
on a national banks lending
to any one borrower be speci-
fed as 10 per cent Of the cap
ital,. surplus and undivided
profits, or such higher per-
centage not in excess of is
per cent, as the Controller may
approve in individual cases.
The present limit is 10 per cent
Of capital and surplus.
Real estate loans should be
allowable up to 80 per cent of
appraised value and for periods
UP to Is years on an aSnortized
basis, the report declared. SUBJ
ject to the 10 per cent limit,
the banks also should be per-
mitted to underwrite and in
vest m revenue bonds of States
and political subdivisions of
quality suitable for bank in
vestment, it added.
Branch Changes Urged
"The committee believes that
expanding needs of our econ
orly for banking facilities and
services require re-examina-
ton Of both Federal and State
laws with respect to the branch
ing privileges Of banks" the
report said.
"on the national level, the
basic question is whether the
public interest will be best
served by the Congress author
izing establishment of branches
by National Banks irrespective
of the law of the State in which
the National Bank is located.
sWhile the committee is we'll .
aware that there is a lack of .
unanimity on this question,
with three members dissenting,
the majority believes that such |
action by Congress is in the |
public interest and recommends |
thai the law be amended so
that any National Bank, in |
ambition to its present right to
branch in accordance with |
State law, be permitted two
years after the amendatory bill |
is effective, to establish |
branches within a limited area !
within the State in which the |
principal office of the particu-
lar National Bank is located, F"
the report continued.
Is Miles Suggested
With respect to boundaries
Of such areas, the concept Of
trading areas has much to
commend it but poses obvious
difficulties of definition. At
leastsinitially, branching within
a fixed radius of 25 miles from
the principal office seems ap-
propriate."
The report also said national
banks should be permitted to
discount leases of personal
property. or otherwise acquire a
lesser's interest in the lease and
leased property. without re-
course to the lessor, and to pur-
chase personal property for the
purpose of simultaneous leas-
ing