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gold. When the funds of the Treasury on hand justify, he may purchase and retire such outstanding bonds and notes.
Sec. 27. The provisions of the Act of May thirtieth, nineteen hundred and eight, authorizing national currency associations, the issue of additional national-bank circulation, and creating a National Monetary Commission, which expires by limitation under the terms of such Act on the thirtieth day of June, nineteen hundred and fourteen, are hereby extended to June thirtieth, nineteen hundred and fifteen, and sections fifty-one hundred and fifty-three, fifty-one hundred and seventy-two, fifty-one hundred and ninety-one, and fifty-two hundred and fourteen of the Revised Statutes of the United States, which were amended by the Act of May thirtieth, nineteen hundred and eight, are hereby reenacted to read as such sections read prior to May thirtieth, nineteen hundred and eight, subject to such amendments or modifications as are prescribed in this Act: Provided, however, That section nine of the Act first referred to in this section is hereby amended so as to change the tax rates fixed in said Act by making the portion applicable thereto read as follows:
National banking associations having circulating notes secured otherwise than by bonds of the United States, shall pay for the first three months a tax at the rate of three per centum per annum upon the average amount of such of their notes in circulation as are based upon the deposit of such securities, and afterwards an additional tax rate of one-half of one per centum per annum for each month until a tax of six per centum per annum is reached, and thereafter such tax of six per centum per annum upon the average amount of such notes.
Sec. 28. Section fifty-one hundred and forty-three of the Revised Statutes is hereby amended and reenacted to read as follows: Any association formed under this title may, by the vote of shareholders owning two-thirds of its capital stock, reduce its capital to any sum not below the amount required by this title to authorize the formation of associations; but no such reduction shall be allowable which will reduce the capital of the association below the amount required for its outstanding circulation, nor shall any reduction be made until the amount of the proposed reduction has been reported to the Comptroller of the Currency and such reduction has been approved by the said Comptroller of the Currency and by the Federal Reserve Board, or by the organization committee pending the organization of the Federal Reserve Board.
Sec. 29. If any clause, sentence, paragraph, or part of this Act shall for any reason be adjudged by any court of competent jurisdiction to be invalid, such judgment shall not affect, impair, or invalidate the remainder of this Act, but shall be confined in its operation to the clause, sentence, paragraph, or part thereof directly involved in the controversy in which such judgment shall have been rendered.
Sec. 30. The right to amend, alter, or repeal this Act is hereby expressly reserved.
Approved, December 23, 1913.
TEXTUAL CHANGES MADE IN FEDERAL RESERVE ACT BY
(Italics indicate new matter inserted by the amendments, and canceled words indicate old matter
AUGUST 4, 1914.
Section 27 of the act of December 23, 1913, was amended by the act of August 4, 1914, by adding at the end of the second and last paragraph thereof, the following:
"--: Provided, further, That whenever in his judgment he may deem it desirable, the Secretary of the Treasury shall have power to suspend the limitations imposed by section one and section three of the Act referred to in this section, which prescribe that such additional circulation secured otherwise than by bonds of the United States shall be issued only to National banks having circulating notes outstanding secured by the deposit of bonds of the United States to an amount not less than forty per centum of the capital stock of such banks, and to suspend also the conditions and limitations of section five of said Act except that no bank shall be permitted to issue circulating notes in excess of one hundred and twenty-five per centum of its unimpaired capital and surplus. He shall require each bank and currency association to maintain on deposit in the Treasury of the United States a sum in gold suficient in his judgment for the redemption of such notes, but in no event less than five per centum. He may permit National banks, during the period for which such provisions are suspended, to issue additional circulation under the terms and conditions of the Act referred to as herein amended: Provided, further, That the Secretary of the Treasury, in his discretion, is further authorized to extend the benefits of this Act to all qualified State banks and trust companies, which have joined the Federal reserve system, or which may contract to join within fifteen days after the passage of this Act."
AUGUST 15, 1914. Section 19 of the act of December 23, 1913, was amended by the act of August 15, 1914 (beginning with the fourth paragraph under (b), as follows:
For a period of 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 resepte or central reserve cities as now defined by law.
“After said thirty-six 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 the option of the member bank.
13 "(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 deposits
and five per centum of its time deposits, as follows: 14 "In its vaults six-eighteenths thereof. 15 “In the Federal reserve bank seven-eighteenths. 16 “The balance of said reserves shall be held in its own vaults
or in the Federal reserve bank, at its option. 17 “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 thirteen properly
indorsed and acceptable to the said reserve bank. 18 “If a State bank or trust company is required or permitted by
the law of its State to keep its reserves either in its own vaults or with another State bank or trust company; or with a national bank, such reserve deposits so kept in such State bank, or trust company, or National bank 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 reserve bank under the provisions of this Act except
by permission of the Federal Reserve Board. 19 “The reserve carried by a member bank with a Federal
reserve bank may, under the regulations and subject to such penalties as may be prescribed by the Federal Reserve Board, be checked against and withdrawn by such member bank for the purpose of meeting existing liabilities: Provided, however, That no bank shall at any time make new loans or shall pay any dividends unless and until the total reserve required
by law is fully restored. 20 "In estimating the reserves required by this Act, the net
balance of amounts due to and from other banks shall be taken as the basis for ascertaining the bank deposits against which reserves shall be determined. Balances in reserve banks due to member banks shall, to the extent herein provided, be counted as reserves.”
MARCH 3, 1915.
Section 13, paragraphs 3, 4, and 5, of the act of December 23, 1913, was amended by the act of March 3, 1915, as follows:
"Any Federal reserve bank may discount acceptances which are based on the importation or exportation of goods and which have a maturity at time of discount of not more than three months and indorsed by at least one member
bank. The amount of acceptances so discounted shall at no time exceed one-half the paid up and unimpaired capital stock and surplus of the bank for which the rediscounts are made-, ercept by authority of the Federal Reserve Board, under such general regulations as said board may prescribe, but not to
exceed the capital stock and surplus of such bank. 4 “The aggregate of such notes and bills bearing the signa
ture or indorsement of any one person, company, firm, or corporation rediscounted for any one bank shall at 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. 5 “Any member bank may accept drafts or bills of exchange
drawn upon it and growing out of transactions involving the importation or exportation 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 of its paid-up and unimpaired capital stock and surplus-, except by authority of the Federal Reserve Board, under such general regulations as said board may prescribe, but not to exceed the capital stock and surplus of such bank, and such regulations shall apply to all banks alike regardless of the amount of capital stock and surplus.''
SEPTEMBER 7, 1916.
Section 11 of the act of December 23, 1913, was amended by the act of September 7, 1916, by adding thereto subsection (m), as follows:
“(m) Upon the affirmative vote of not less than five of its members the Federal Reserve Board shall have power, from time to time, by general ruling, covering all districts alike, to permit member banks to carry in the Federal reserve banks of their respective districts any portion of their reserves now required
by section nineteen of this Act, to be held in their own va uits.' Section 13 of the act of December 23, 1913, as amended by the act of March 3, 1915, was amended by the act of September 7, 1916, as follows:
"Any Federal reserve bank may receive from any of its member banks, and from the United States, deposits of current funds in lawful money, national bank notes, Federal reserve notes, or checks, and drafts, upon-solvent-tember banks; payable upon presentation, and also, for collection, maturing bills: or; solely for purposes of exchange purposes
: or of collection, may receive from other Federal reserve banks deposits of current funds in lawful money, national bank notes, or checks and drafte upon solvent member of other Federal reserve banks, and checks and drafts, payable upon presentation within its district, and maturing bills payable within its district.
“Upon the indorsement of any of its member banks, with which shall be deemed a waiver of demand, notice and protest by such bank; as to its own indorsement exclusively; any Federal reserve bank may discount notes, drafts, and bills of exchange arising out of actual commercial transactions; that is, notes, drafts, and bills of exchange issued or drawn for agricultural, industrial, or commercial purposes, or the proceeds of which have been used, or are to be used, for such purposes, the Federal Reserve Board to have the right to determine or define the character of the paper thus eligible for discount, within the meaning of this Act. Nothing in this Act contained shall be construed to prohibit such notes, drafts, and bills of exchange, secured by staple agricultural products, or other goods, wares, or merchandise from being eligible for such discount; but such definition shall not include notes, drafts, or bills covering merely investments or issued or drawn for the purpose of carrying or trading in stocks, bonds, or other investment securities, except bonds and notes of the Government of the United States. Notes, drafts, and bills admitted to discount under the terms of this paragraph must have a maturity at the time of discount of not more than ninety daysă, exclusive of days of grace: Provided, That notes, drafts, and bills drawn or issued for agricultural purposes or based on live stock and having a maturity not exceeding six months, exclusive of days of grace, may be discounted in an amount to be limited to a percentage of the eapitał assets of the Federal reserve bank, to be ascer
tained and fixed by the Federal Reserve Board. 4 3 “The aggregate of such notes, drafts, and bills bearing the
signature or indorsement of any one borrower, whether a person, company, firm, or corporation, rediscounted for any one bank shall at 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. 4 " Any Federal reserve bank may discount acceptances
which are based on the importation-or-exportation of geeds and of the kinds hereinafter described, which have a maturity at the time of discount of not more than three months, months' sight, exclusive of days of grace, and which are indorsed by at least one member bank. The amount-of-heeeptanees so-discounted-shell-at-ho-time-exceed-one-half-the-paid-up capital steek and surplus of-the-bank-for-whieh-the-redis
counts-are-made. 5 “Any member bank may accept drafts or bills of exchange
drawn upon it and having not more than six months' sight to run, exclusive of days of grace, which growing out of transactions involving the importation or exportation of goods, having-hot-more-than-six-months-sight-to-pun:-but or which grow out of transactions involving the domestic shipment of goods provided shipping documents conveying or securing title are attached at the time of acceptance; or which are secured at the time of acceptance by a warehouse receipt or other such