HOUSE BILL.

Section fifty-two hundred and two of the Revised Statutes of the United States is hereby amended so as to read as follows: No association shall at any time be indebted, or in any way liable, to an amount exceeding the amount of its capital stock at such time actually paid in and remaining undiminished by losses or otherwise, except on account of demands of the nature following:

First. Notes of circulation. Second. Moneys deposited with or collected by the association..

Third. Bills of exchange or drafts drawn against money actually on deposit to the credit of the association, or due thereto.

Fourth. Liabilities to the stockholders of the association for dividends and reserve profits.

Fifth. Liabilities incurred under the provisions of sections two, five, and fourteen of the Federal reserve Act.

OWEN AMENDMENT.

no time exceed ten per centum of the unimpaired capital and surplus of said bank; but this restriction shall not apply to the discount of bills of exchange drawn in good faith against actually existing val

ues.

Any national bank may, at its discretion, accept drafts or bills of exchange drawn upon it having not more than six months sight to run and growing out of transactions involving the importation, er exportation, or domestic shipment of goods having not more than six months sight to run; but no bank shall accept such bills to an amount equal at any time in the aggregate to more than one-half the face value of its paid-up and unimpaired capital stock and surplus.

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Section fifty-two hundred and two of the Revised Statutes of the United States is hereby amended so as to read as follows: No association shall at any time be indebted, or in any way liable, to an amount exceeding the amount of its capital stock at such time actually paid in and remaining undiminished by losses or otherwise, except on account of demands of the nature following:

First. Notes of circulation. Second. Moneys deposited with or collected by the association

Third. Bills of exchange or drafts drawn against money actually on deposit to the credit of the association, or due thereto.

Fourth. Liabilities to the stockholders of the association for dividends and reserve profits.

Fifth. Liabilities incurred under the provisions of sections two, five, and fourteen of the Federal reserve this Act.

The Federal Reserve Board may authorize the reserve bank of the district to discount the direct obligations of member banks, secured by the pledge and deposit of satisfactory securities; but in no case shall the amount so loaned by a Federal reserve bank exceed three fourths of the actual value of the securities so pledged.

HITCHCOCK AMENDMENT.

no time exceed ten per centum of the unimpaired capital and surplus of said bank; but this restriction shall not apply to the discount of bills of exchange drawn in good faith against actually existing values.

Any national bank may, at its discretion, accept drafts or bills of exchange drawn upon it having not more than six months sight-to-run and growing out of transactions involving the importation or exportation of goods having not more than six months to run or growing out of the domestic shipment of goods and having not more than four months to run; but no bank shall accept such bills to an amount equal at any time in the aggregate to more than one half the face par value of its paid-up and unimpaired capital.

Section fifty two hundred and two of the Revised Statutes of the United States is hereby amended so as to read as follows: No associa, tion shall at any time be indebted or in any way liable, to an amount exceeding the amount of its capital steek at such time actually paid in and remaining undiminished by losses or otherwise, except on ae count of demands of the nature fol lowing:

43

First. Notes of circulation. Second. Moneys deposited with or collected by the association.

Third. Bills of exchange or drafts drawn against money actually on deposit to the credit of the associa tion, or due thereto.

Fourth. Liabilities to the stockholders of the association for divi dends and reserve profits.

Fifth. Liabilities incurred under the provisions of sections two, five, and fourteen of the Federal reserve Aet.

The Federal Reserve Board may authorize the reserve bank of the district to discount the direct obligations of member banks, secured by the pledge and deposit of satisfactory securities; but in no case shall the amount so loaned by a reserve bank exceed threefourths of the actual market value of the securities so pledged or one-half the amount of the paid-up and unimpaired capital of the member bank.

SEC. 15. That any Federal reserve bank may, under rules and regulations prescribed by the Federal Reserve Board, purchase and sell in the open market, either from or to domestic or foreign banks, firms, corporations, or individuals, prime bankers' bills, and bills of exchange of the kinds and maturities by this Act made eligible for rediscount, and cable transfers.

Every Federal reserve bank shall have power (a) to deal in gold coin and bullion both at home and abroad, to make loans thereon, and to contract for loans of gold coin or bullion, giving therefor, when necessary, acceptable security, including the hypothecation of

OWEN AMENDMENT.

The rediscount by any Federal reserve bank of any bills receivable and of domestic and foreign 45 bills of exchange and acceptances shall be subject to such restrictions, limitations, and regulations as may be imposed by the Federal Reserve Board.

SECTION 15.

OPEN-MARKET OPERATIONS.

.SEC. 15 14. That any Any Federal reserve bank may, under rules and regulations prescribed by the Federal Reserve Board, purchase and sell in the open market, at home or abroad, either from or to domestic or foreign banks, firms, corporations, or individuals, prime cable transfers and bankers' bills acceptances and bills of exchange of the kinds and maturities by this Act made eligible for rediscount, and eable transfers with or without the indorsement of a member bank.

Every Federal reserve bank shall have power: (a) to deal in gold coin and bullion both at home and or abroad, to make loans thereon, exchange Federal reserve notes for gold, gold coin, or gold certificates, and to contract for loans of gold coin or bullion, giving therefor, when necessary, acceptable security, including the hypothecation of United States bonds or other securities which Federal reserve banks are authorized

HITCHCOCK AMENDMENT.

The rediscount by any Federal reserve bank of any bills receivable and of domestic and foreign bills of exchange shall be subject to such regulations as may be imposed by the board.

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The discount provisions of this Act shall be equitably extended to all of its member banks by each reserve bank upon equal terms, and each member bank shall be entitled as a matter of right to the rediscount of eligible paper to the full amount of its capital stock upon the lowest current rate of discount, and no member bank shall be permitted to discount an amount of paper exceeding the amount of its capital stock except upon payment of a higher rate of discount, the increase in rate of discount to be one per centum for an additional fifty per centum of discounts or part thereof and two per centum for all in excess. In no case shall a Federal reserve bank discount paper for a member bank in excess of twice the amount of its capital_stock without special authority by the board.

OPEN-MARKET OPERATIONS.

SEC. 15. That any Any Federal reserve bank may, under rules and regulations prescribed by the Federal Reserve Board, purchase and sell in the open market, either from or to domestic or foreign banks, firms, corporations, or individuals, prime bankers' bills, and bills of exchange of the kinds and maturities by this Act made eligible for rediscount, and cable transfers.

Every Federal reserve bank shall have power (a) to deal in gold coin and bullion both at home and abroad, to make loans thereon, and to contract for loans of gold coin or bullion, giving therefor, when necessary, acceptable security, including the hypothecation of interest-bearing obligations of the United States

HOUSE BILL.

United States bonds; (b) to invest in United States bonds, and bonds issued by any State, county, district, or municipality;

(c) to purchase from member banks and to sell, with or without its indorsement, bills of exchange arising out of commercial transactions, as hereinbefore defined, payable in foreign countries; but such bills of exchange must have not exceeding ninety days to run and must bear the signature of two or more responsible parties, of which the last shall be that of a member bank; (d) to establish each week, or as much oftener as required, subject to review and determination of the Federal Reserve Board, a rate of discount to be charged by such bank for each class of paper, which shall be fixed with a view of accommodating the commerce of the country; and

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(e) with the

consent of the Federal Re

serve Board, to open and maintain banking accounts in foreign countries and establish agencies in such countries wheresoever it may deem best for the purpose of purchasing, selling, and collecting foreign bills of exchange, and to buy and sell with or without its indorsement, through such correspondents or agencies, prime foreign bills of exchange arising out of commercial transactions which have not exceeding ninety days to run and which bear the signature of two or more responsible parties.

OWEN AMENDMENT.

to hold; (b) to invest in buy and sell at home or abroad, bonds and notes of the United States bonds, and bonds issued by any State, county, dis triet, or municipality bills, notes,

revenue bonds, and warrants 46 with a maturity from date of purchase of not exceeding six months, issued in anticipation of the collection of taxes or in anticipation of the receipt of assured revenues by any State, county, district, political subdivision, or municipality in the continental United States, such purchases to be made in accordance with rules and regulations prescribed by the Federal Reserve Board:

(c) to purchase from member banks and to sell, with or without its indorsement, bills of exchange arising out of commercial transactions, as hereinbefore defined, payable in foreign countries; but such bills of exchange must-have not exceeding ninety days to run and must bear the sig nature of two or more responsible parties, of which the last shall be that of a member-bank; (d) to establish each week, or as much oftener as required from time to time, subject to review and determination of the Federal Reserve Board, a rate rates of discount to be charged by such the Federal reserve bank for each class of paper, which shall be fixed with a view of accommodating the commerce of the country and business; and (e) to establish accounts with other Federal reserve

banks for exchange purposes and, with the consent of the Federal Reserve Board, to open and maintain banking accounts in foreign countries, appoint correspondents, and establish agencies in such countries wheresoever it may deem best for the purpose of purchasing, sell

47

ing, and collecting foreign bills of exchange, and to buy and sell with or without its indorsement, through such correspondents or agencies, prime for eign bills of exchange arising out of actual commercial transactions which have not exceeding more than ninety days to run and which bear the signature of two or more .responsible parties.

HITCHCOCK AMENDMENT.

bonds; (b) to invest in United States bonds, and bonds issued by any State, county, district, or municipality (b) to buy and sell interest-bearing obligations of the United

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the

States and of its dependencies when payment of principal and interest is guaranteed by United States, and bonds or warrants of any State, county, or municipality, or short-time interestbearing obligations issued by foreign governments, with a maturity from date of purchase of not exceeding one year, such purchases to be made in accordance with rules and regulations prescribed by the Federal Reserve Board; (c) to purchase from a member banks bank and to sell, with or without its own indorsement, bills of exchange arising out of commercial transactions, as herein before defined, payable in foreign coun tries; but such bills of exchange must have not exceeding ninety days to run and must bear the sig nature of two or more responsible parties, of which the last shall be that of a member bank; (d) to establish each week, or as much oftener as required publicly from time to time, subject to review and determination of the Federal Reserve Board, a rate of discount to be charged by such bank for each class of paper, which shall be fixed with a view of accommodating the commerce of the country and promoting stability in business; and (e) establish accounts with other reserve banks

and with the consent of the Federal Reserve Board, to open and maintain banking accounts in foreign countries and establish agencies in such countries wheresoever it may deem best for the purpose of purchasing, selling, and collecting foreign bills of exchange, letters of credit, and travelers' checks, and to buy and sell with or without its in

46

dorsement, through such correspondents or agencies, prime foreign bills of exchange arising out of commercial transactions which have not exceeding ninety days to run and which bear the signature of two or more responsible parties.