the United States, of certain foreign banks of which the federal reserve banks are the American agencies, and of certain foreign governments. See text, pp. 70-71, 80; Act, sec. 14, par. (e); and Regulation J issued by the federal reserve board June 22, 1917, Federal Reserve Bulletin, July 1, 1917, pp. 549-550.

22 This item represents the total amount of federal reserve notes issued to the federal reserve banks and now outstanding (exclusive of the amount now held by federal reserve banks. See text, pp. 51-57; and Act, sec. 16.

23 These are the federal reserve bank notes described above in note 14. The net liability represents the total amount outstanding less the amount of cash deposited with the treasurer of the United States for the retirement of such notes. See text, pp. 5051; Act of March 4, 1907, sec. 4 amending Act of July 12, 1882.

24 This represents the net credit balance on a variety of miscellaneous accounts. It includes the excess of earned and unearned discount and interest over expenses and certain unproductive assets. Compare note 15 above.

Definitions of terms.

APPENDIX B

FEDERAL RESERVE ACT

(APPROVED DEC. 23, 1913)

As amended Aug. 4, 1914 (38 Stat., 682; Chap. 225); Aug. 15, 1914 (38 Stat., 691; Chap. 252); Mar. 3, 1915 (38 Stat., 958; Chap. 93); Sept. 7, 1916 (39 Stat., 752; Chap. 461); June 21, 1917 (40 Stat., Chap. 82); Sept. 26, 1918; Sept. 17, 1919; and Dec. 24, 1919.

An Act To provide for the establishment of Federal reserve banks, to furnish an elastic currency, to afford means of rediscounting commercial paper, to establish a more effective supervision of banking in the United States, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the short title of this Act shall be the "Federal Reserve Act."

Wherever the word "bank" is used in this Act, the word shall be held to include State bank, banking association, and trust company, except where national banks or Federal reserve banks are specifically referred to.

The terms "national bank" and "national banking association" used in this Act shall be held to be synonymous and interchangeable. The term "member bank" shall be held to mean any national bank, State bank, or bank or trust company which has become a member of one of the reserve banks created by this Act. The term "board" shall be held to mean Federal Re

serve Board; the term "district" shall be held to mean Federal reserve district; the term "reserve bank" shall be held to mean Federal reserve bank.

FEDERAL RESERVE DISTRICTS

Determina

tricts.

SEC. 2. As soon as practicable, the Secretary of the Treasury, the Secretary of Agriculture and the Comptroller of the Currency, act- tion of ing as "The Reserve Bank Organization Committee," shall designate not less than eight nor more than twelve cities to be known as Federal reserve cities, and shall divide the continental United States, excluding Alaska, into districts, each district to contain only one of such Federal reserve cities. The determination of said organization committee shall not be subject to review except by the Federal Reserve Board when organized: Provided, That the districts shall be apportioned with due regard to the convenience and customary course of business and shall not necessarily be coterminous with any State or States. The districts thus created may be readjusted and new districts may from time to time be created by the Federal Reserve Board, not to exceed twelve in all. Such districts shall be known as Federal reserve districts and may be designated by number. A majority of the organization committee shall constitute a quorum with authority to act.

Said organization committee shall be authorized to employ counsel and expert aid, to take testimony, to send for persons and papers, to administer oaths, and to make such investigation as may be deemed necessary by the said committee in determining the reserve districts and in designating the cities within such districts where such Federal reserve banks shall be severally located. The said committee shall su

dis

Nationa?

tem; state

trust

nies permitted to join.

pervise the organization in each of the cities designated of a Federal reserve bank, which shall include in its title the name of the city in which it is situated, as "Federal Reserve Bank of Chicago."

Under regulations to be prescribed by the banks requir. organization committee, every national banking ed to join sys- association in the United States is hereby rebanks and quired, and every eligible bank in the United compa: States and every trust company within the District of Columbia, is hereby authorized to signify in writing, within sixty days after the passage of this Act, its acceptance of the terms and provisions hereof. When the organization committee shall have designated the cities in which Federal reserve banks are to be organized, and fixed the geographical limits of the Federal reserve districts, every national banking association within that district shall be required within thirty days after notice from the organization committee, to subscribe to the capital stock of such Federal reserve bank in a sum equal to six per centum of the paid-up capital stock and surplus of such bank, one-sixth of the subscription to be payable on call of the organization committee or of the Federal Reserve Board, one-sixth within three months and one-sixth within six months thereafter, and the remainder of the subscription, or any part thereof, shall be subject to call when deemed necessary by the Federal Reserve Board, said payments to be in gold or gold certificates.

Stock subscriptions.

holders.

The shareholders of every Federal reserve Double lia. bank shall be held individually responsible, bility of stock equally and ratably, and not one for another, for all contracts, debts, and engagements of such bank to the extent of the amount of their subscriptions to such stock at the par value thereof in addition to the amount subscribed, whether

such subscriptions have been paid up in whole or in part, under the provisions of this Act.

Any national bank failing to signify its acceptance of the terms of this Act within the sixty days aforesaid, shall cease to act as a reserve agent, upon thirty days' notice, to be given within the discretion of the said organization committee or of the Federal Reserve Board.

National banks not joining sys

forfeit their charters.

Should any national banking association in the United States now organized fail within one year after the passage of this Act to become tem a member bank or fail to comply with any of the provisions of this Act applicable thereto, all of the rights, privileges, and franchises of such association granted to it under the national-bank Act, or under the provisions of this Act, shall be thereby forfeited. Any noncompliance with or violation of this Act shall, however, be determined and adjudged by any court of the United States of competent jurisdiction in a suit brought for that purpose in the district or territory in which such bank is located, under direction of the Federal Reserve Board, by the Comptroller of the Currency in his own name before the association shall be declared dissolved. In cases of such noncompliance or violation, other than the failure to become a member bank under the provisions of this Act, every noncompliance director who participated in or assented to the with act. same shall be held liable in his personal or individual capacity for all damages which said bank, its shareholders, or any other person shall have sustained in consequence of such violation. Such dissolution shall not take away or impair any remedy against such corporation, its stockholders or officers, for any liability or penalty which shall have been previously incurred. scriptions to Should the subscriptions by banks to the stock of said Federal reserve banks or any one or more of them be, in the judgment of the organi

Penalties for

Public sub

stock to be authorized un

der certain contingencies.