HOUSE BILL

BANK RESERVES.

PASSED BY SENATE.

SECTION 20.

BANK RESERVES.

CONFERENCE AGREEMENT.

prescribe in denominations of one hundred dollars, or any multiple thereof, bearing interest at the rate of three per centum per annum, payable quarterly, such Treasury notes to be payable not more than one year from the date of their issue in gold coin of the present standard value, and to be exempt as to principal and interest from the payment of all taxes and duties of the United States except as provided by this Act, as well as from taxes in any form by or under State, municipal or local authorities. And for the same purpose, the Secretary is authorized and empowered to issue United States gold bonds at par, bearing three per centum interest payable thirty years from date of issue, such bonds to be of the same general tenor and effect and to be issued under the same general terms and conditions as the United States three per centum bonds without the circulation privilege now issued and outstanding.

Upon application of any Federal reserve bank, approved by the Federal Reserve Board, the Secretary may issue at par such three per bonds in exchange for the one year gold notes herein provided for.

BANK RESERVES.

centum

SEC. 20. That from and after the date when the Secretary of the Treasury shall have officially announced, in such manner as he may elect, the fact that a Federal reserve bank has been established in any designated district, every banking association within said district which shall have subscribed for stock in such Federal reserve bank shall be required to establish and maintain reserves as follows:

(a) If a country bank as defined by existing law, it shall hold and maintain a reserve equal to twelve per centum of the aggregate amount of its deposits, not including savings

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SEC. 19. Demand liabilities within the meaning of this Act shall comprise all liabilities maturing or payable within thirty days, and time deposits shall comprise all deposits payable after thirty days, and all savings accounts and certificates of deposit which are subject to not less than thirty days' notice before payment.

When the Secretary of the Treasury shall have officially announced, in such manner as he may elect, the establishment of a Federal reserve bank in any district, every subscribing member bank shall establish and maintain reserves as follows:

(a) A bank not in a reserve or central reserve city as now or hereafter defined shall hold and maintain reserves equal to twelve per centum of the aggregate amount of its demand

SEC. 19. Demand [liabilities] DEPOSITS within the meaning of this Act shall comprise all liabilities maturing or] DEPOSITS payable within thirty days, and time deposits shall comprise all deposits payable after thirty days, and all savings accounts and certifi cates of deposit which are subject to not less than thirty days' notice before payment.

When the Secretary of the Treasury shall have officially announced, in such manner as he may elect, the establishment of a Federal reserve bank in any district, every subscribing member bank shall establish and maintain reserves as follows:

(a) A bank not in a reserve or cen tral reserve city as now or hereafter defined shall hold and maintain reserves equal to twelve per centum of the aggregate amount of its demand

HOUSE BILL.

required may, for a period of thirtysix months from and after the date fixed by the Secretary of the Treasury as hereinbefore provided, consist of balances due from national banks in reserve or central reserve cities as now defined by law. From and after a date thirty-six months subsequent to the date fixed by the Secretary of the Treasury as hereinbefore provided the said remainder of the twelve per centum reserve required of each country bank shall consist either in whole or in part of reserve money in the bank's own vaults or of credit balance with the Federal reserve bank of its district.

(b) If a reserve city bank as defined by existing law, it shall hold and maintain, for a period of sixty days from the date fixed by the Secretary of the Treasury as hereinbefore provided, a reserve equal to twenty per centum of the aggregate amount of its deposits, not including savings deposits hereinafter provided for, and permanently thereafter eighteen per centum. At least one-half of such reserve shall consist of money which national banks may under existing law count as legal reserve, held actually in the bank's own vaults. After sixty days from the date aforesaid, and for a period of one year, at least threeeighteenths and permanently thereafter at least five-eighteenths of

such reserve shall consist of a credit

PASSED BY SENATE.

liabilities and five per centum of its time deposits, as follows:

In its vaults for a period of twentyfour months after said date fourtwelfths thereof.

In the Federal reserve bank of its district, for a period of six months after said date, two-twelfths, and for each succeeding six months an additional one-twelfth, until five-twelfths have been so deposited, which shall be the amount permanently required.

For a period of twenty-four months after said date the balance of the reserves may be held in its own vaults, or in the Federal reserve bank, or in banks in reserve or central reserve cities as now defined by law.

After said twenty-four months' period said reserves, other than those hereinbefore required to be held in the reserve bank, shall be held in the vaults of the member bank or in the Federal reserve bank, or in both, at its option.

(b) A bank in a reserve city, as now or hereafter defined, shall hold and maintain reserves equal to fifteen per centum of the aggregate amount of its demand liabilities and five per centum of its time deposits, as follows:

In its vaults six-fifteenths thereof.

In the Federal reserve bank of its district for a period of six months after the date aforesaid at least threefifteenths, and for each succeeding six months an additional one-fifteenth, until six-fifteenths have been so deposited, which shall be the amount permanently required.

CONFERENCE AGREEMENT.

liabilities] DEPOSITS and five per centum of its time deposits, as follows:

In its vaults for a period of [twentyfour] THIRTY-SIX months after said date [four-twelfths] FIVE-TWELFTHS thereof AND PERMANENTLY THERE

AFTER FOUR-TWELFTHS.

In the Federal reserve bank of its district, for a period of [six] TWELVE months after said date, two-twelfths, and for each succeeding six months an additional one-twelfth, until fivetwelfths have been so deposited, which shall be the amount permanently required.

For a period of [twenty-four] THIRTY-SIX months after said date the balance of the reserves may be held in its own vaults, or in the Federal reserve bank, or in NATIONAL banks in reserve or central reserve cities as now defined by law.

After said twenty-four] THIRTYSIX months' period said reserves, other than those hereinbefore required to be held in the VAULTS OF THE MEMBER BANK AND IN THE FEDERAL reserve bank, shall be held in the vaults of the member bank or in the Federal reserve bank, or in both, at [its] THE option OF THE MEMBER

BANK.

(b) A bank in a reserve city, as now or hereafter defined, shall hold and maintain reserves equal to fifteen per centum of the aggregate amount of its demand liabilities] DEPOSITS and five per centum of its time deposits, as follows:

In its vaults FOR A PERIOD OF THIRTY-SIX MONTHS AFTER SAID

DATE six-fifteenths thereof, AND PER

MANENTLY THEREAFTER FIVE-FIFTEENTHS

In the Federal reserve bank of its district for a period of [six] TWELVE months after the date aforesaid at least three-fifteenths, and for each succeeding six months an additional one-fifteenth, until sixfifteenths have been so deposited, which shall be the amount permanently required.

FOR A PERIOD OF THIRTY-SIX MONTHS AFTER SAID DATE THE BALANCE OF THE RESERVE MAY BE HELD IN ITS OWN VAULTS, OR IN THE FEDERAL RESERVE BANK, OR IN NATIONAL BANKS IN RESERVE OR CENTRAL RESERVE CITIES AS NOW DEFINED BY LAW.

HOUSE BILL

From and after a date thirty-six months subsequent to the date fixed by the Secretary of the Treasury as herein before provided, the said remainder of the eighteen per centum reserve required of each reserve city bank shall consist either in whole or in part of reserve money in the bank's own vaults or of credit balance with the Federal reserve bank of its district.

(c) If a central reserve city bank as defined by existing law, it shall hold and maintain for a period of sixty days from the date fixed by the Secretary of the Treasury as hereinbefore provided a reserve equal to twenty per centum of the aggregate amount of its deposits, not including savings deposits hereinafter provided for, and permanently thereafter eighteen per centum. At least one-half of such reserve shall consist of money which national banks may under existing law count as legal reserve, held actually in the bank's own vaults. After sixty days from the date aforesaid, and thereafter for a period of one year, at least three-eighteenths and permanently thereafter at least five-eighteenths of such reserve shall consist of a credit balance with the Federal reserve bank of its dis

trict. The remainder of the 39 eighteen per centum reserve required of each central reserve city bank shall consist either in whole or in part of reserve money actually held in its own vaults or of credit balance with the Federal reserve bank of its district.

PASSED BY SENATE.

After said twenty-four months' period all of said reserves, except those hereinbefore required to be held permanently in the Federal reserve bank, shall be held in its vaults or in the Federal reserve bank, or in both, at its option.

(c) A bank in a central reserve city, as now or hereafter defined, shall hold and maintain a reserve equal to eighteen per centum of the aggregate amount of its demand liabilities and five per centum of its time deposits, as follows:

In its vaults six-eighteenths thereof. In the Federal reserve bank for a period of six months after the date aforesaid at least three-eighteenths, and permanently thereafter sixeighteenths.

The balance of said reserves shall be held in its own vaults or in the Federal reserve bank at its option.

Any Federal reserve bank may receive from the member banks as reserves, not exceeding one half of each installment, eligible paper as described in section fourteen properly indorsed and acceptable to the said reserve bank.

If a State bank or trust company is required by the law of its State to keep its reserves either in its own vaults or with another State bank or trust company, such reserve deposits so kept in such State bank or trust company shall be construed, within the meaning of this section, as if they were reserve deposits in a national bank in a reserve or central reserve city for a period of three years after the Secretary of the Treasury shall have officially announced the establishment of a Federal reserve bank in the district in which such State bank or trust company is situate. Except as thus provided no member bank shall keep on deposit with any nonmember bank a sum in excess of ten per centum of its own paid-up capital and surplus. No member bank shall act as the medium or agent of a nonmember bank in applying for or receiving discounts from a Federal

CONFERENCE AGREEMENT

After said [twenty-four] THIRTYsix months' period all of said reserves, except those hereinbefore required to be held permanently in the

VAULTS OF THE MEMBER BANK AND

IN THE Federal reserve bank, shall be held in its vaults or in the Federal reserve bank, or in both, at [its] THE option OF THE MEMBER BANK.

(c) A bank in a central reserve city, as as now or hereafter defined, shall hold and maintain a reserve equal to eighteen per centum of the aggregate amount of its demand liabilities] DEPOSITS and five per centum of its time deposits, as follows:

In its vaults six-eighteenths thereof. In the Federal reserve bank for a period of six months after the date aforesaid at least three-eighteenths, and permanently thereafter sixeighteenths] SEVEN-EIGHTEENTHS.

The balance of said reserves shall be held in its own vaults or in the Federal reserve bank, at its option.

Any Federal reserve bank may receive from the member banks as reserves, not exceeding one-half of each installment, eligible paper as described in section fourteen properly indorsed and acceptable to the said reserve bank.

is

If a State bank or trust company required by the law of its State to keep its reserves either in its own vaults or with another State bank or trust company, such reserve deposits so kept in such State bank or trust company shall be construed, within the meaning of this section, as if they were reserve deposits in a national bank in a reserve or central reserve city for a period of three years after the Secretary of the Treasury shall have officially announced the establishment of a Federal reserve bank in the district in which such State bank or trust company is situate. Except as thus provided, no member bank shall keep on deposit with any nonmember bank a sum in excess of ten per centum of its own paid-up capital and surplus. No member bank shall act as the medium or agent of a nonmember bank in applying for or receiving discounts from a Federal