frsbog_mim_v25_0398.pdf

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FEDERAL BSSEEVS AGENT.

1 . Number of examiners Total sa la ri es pa id

2 .

Number

of

a s s i s t an t s Tota l sa la r i es pa id

3 .

Number

of

other employees

a t

headquar ters Total sa la ri es pai d

4 . How a r e

examiners selected

and

organized?

I s t h e

personnel

of the ex-

amining force made up of men qua l i f i ed and t r a i ned f o r their work?

5 . I s examining force capable o f conducting an examination, independent of

s t a t e fo r ce , of the large hanks i n your d i s t r i c t?

6 . When add it i on al as si st an ce i s needed f o r examination of large hanks o r

f o r o ther purposes, how s e lec ted and from what source o bta ine d - qua l i -

f i ca t i ons?

7 .

Sa l a r i e s

an d

expenses paid

f o r

such assistance?

8 Bow

many examiners

do you

have capable

of

making independent credit

i n -

ves t iga t ions? Of this number how many a r e n o t regularly engaged i n

this work?

Give

t h e

information

a s

indicated

b y t h e s i x

questions below

as t o

each

examiner , ass is tant an d other employees i n t h e department;

1 . Name Age

2 . Salary

3 .

Length

of

s e rv ice

a s

examiner

4 .

Previou s experie nce

5. Any special personal qua l i f ica t io ns

6 . General ab i l i t y an d professional judgment

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399

X-4747

MEMBER STATS BANKS

Give t h e information indicated b y t h e nine questions below, b y s t a t es ,

as to

each bank

i n t h e

d i s t r ic t , making separate l i s t s

f o r

each class

of

banks:

1 . Commercial banks Commercial & t r u s t companies

Tru st companies Trust

and

savings banks

Savings banks

2 .

tUaaie

an d

locat ion

3 .

Capital

4 . Surplus

5 .

P r o f i t s

6 .

Deposits

7 .

Loans

8 .

Fixed as se ts

9 .

Total as se ts

In

add i t ion

t o t h e

foregoing information, please give separately

t h e

information cal led

f o r

under questions below:

1 .

ITumber

of

member state banks closed

in 1925

<?-.

Uumber

of

member state banks closed

in 1926

3 . Number of non-member banks

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400

X-4747

EXPENSES

Separate

by

years

-

1925-1926

1 .

Number

of

state member banks

2 . Combined resou rces

3 .

Cost

of and

charge made

f o r

examinations

4 . Method of assist ing banks

5 . Tra vel ing expenses

6 .

Off ic e suppl ies , p r i n t i ng

and

s ta t ionery

7 . Tehephone, te le gr ap h

8 . Stenographic

9 . Addit ional help , d t c .

10 i A l l

other expenses

11. Has th e

cost

o f a l l

examinat ions made been charged?

I f n o t ,

g ive l i s t

of

banks n o t charged and reasons therefor ,

12. Has cost o f a l l c r e di t i nv es ti ga ti on s made been absorbed b y t h e reserve

banks? I f n o t , gi ve names of banks charged and r easons therefor .

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A

J/Mim TOHi

X-4-747

1 .

Scope

- Do the

examinations

now

made give

t h e

necessary information

to

enable t h e Federal Recerve Board to determine whether o r n o t t h e member

banks a r e operat ing within t h e requirements o f t h e Federal Reserve Act ,

th o

r egu l a t i ons

o f t h e

Board

and the

condi t ions

o f

membership?

Do examinations include complete inspection o f a l l a s s e t s and l i a b i l i t i e s ?

2 . Procedure - Do examiners upon entering bank promptly an d immediately

place a l l books, records an d tangible assets under seal and do they

maintain custody and control unti l work o f inspect ion as to p a r t i cu l a r

groups of a s s e t s o r accounts h a s been completed?

3 . Frequency

4 . A r e a l l

examinations

so

conducted

as to

develop

as to

each class

of

a s s e t s

and

accounts examined

t h e

ess ent ial fa ct s? ( Informat ion

i n

response

to

this question involves

an

inquiry

a s to how an

individual

examiner conducts every step in an examination)

5 . What examinat ion of l i a b i l i t i e s i s made by Federal reserve examiners when

making examinations?

6 .

What examina tion

of

l i a b i l i t i e s

i s

made

by

Federal reserve examiners when

making credit analysis?

7. Are p roofs of C/D - cashiers checks, e t c . , ca rr ie d forward from one exam-

ina t ion

to

another

( a

continuous proof)

by

ei ther state department

o r

Federal reserve

examiners-?

8. Any a t t en t io n given to bank accounts, e t c . , - reconci led o r inspected?

9. Do examiners,during th e examination a n d while a t t h e bank, inq uir e into

and examine t h e fol lowing:

a . Whether the law wi th reference t o t h e stock ownership of Federal

reserve bank h a s been complied with?

b . Whether th e bank has had any withdrawal o r impairment o f cap -

ital since last examination?

c . Whether t h e bank h a s un impai red capi ta l suf f ic ient to e n t i t l e

i t t o b e

national bank

i n

same situation

o r

equal

to 60$

with provis ions f o r paying addi t ional 4 0 $ o u t o f n e t income?

d . Whether t h e bank rediscounts with Federal reserve bank paper

of a

borrower

who i s

l i a b l e

to

bank

in

excess

of

provis ions

of Federal Reserve Act?

e . Whether bank c e r t i f i e s any checks against funds which a r e n o t

• a c t u a l l y on deposi t a t t h e time of c e r t i f i c a t i o n ?

f . Whether bank h a s rediscounted with Federal reserve bank f o r

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EXAMINATIONS (Cont d)

an y per son , company, fi rm .o r corpo rat ion any n o t e s , d r a f t s o r

b i l l s t e a r i n g t h e s ignature o r endorsement of any one borrower

i n excess of 10fo of th e unimpaired capital an d su rp lus of the

bank, excepting b i l l s

of

exchange drawn

i n

good faith against

actual exist ing values,

g . Whether bank h a s accepted f o r a ny one pe rs on , company, fi rm

o r co rporat ion an amount i n excess of 10$ o f i t s p a id u p

a n d unimpaired capital and surplus? I f so , whether e x -

c e s s l i a b i l i t y i s secured by documents or by some other

actual security growing

ou t of t h e

same transaction

a s

t h e acce ptance? Whether any such acceptances have more

than s i x months t o run?

h . Whether t h e bank h a s l i a b i l i t y f o r a ccep ted b i l l s to an

amount equal i n t h e aggregate more than one-half o f i t s

paid

up and

unimpaired capital

a n d

surplus?

I f so ,

whether Federal Reserve Board

h a s

given permission

to

accept such excess?

i . Whether bank h a s accepted i n domest ic t ransact ions b i l l s

drawn in excess of 50$ o f i t s p a id up and unimpaired c a p -

i t a l

and

surplus?

j . Whether bank h a s accepted draf t s o r b i l l s of exchange f o r

t h e purpose of fu rn is hi ng dol la r exchange? I f so , whether

Sect ion 13 of th e Federal Reserve A c t h a s been complied with?

k .

Whether

t h e

bank

h a s

received special permission

o f t h e

Fed-*

eral Reserve Board to accept do lla r exchange b i l l s ?

1 . Whether a l l of t h e acceptances made b y bank drawn i n lawful

t r ansac t ions

a r e

wi thin

t h e

l im i t a t ion

a s

s t a t ed

i n

Regula-

t ion

C of th e

Federal Reserve Board?

m. Whether t h e bank acts a s a medium or as an agent of a non-

member bank i n applying f o r discounts from t h e Federal

reserve banks?

n . Whether t h e bank makes new loans o r pays any dividends

when required reserves

a r e

d e f i c i en t ,

o . Whether t h e bank or any o f f i c e r , d i r ec t o r o r employee

thereof

h a s

made

any

loan

o r

granted

any

g r a t u i t y

to any

bank examiner?

p . Whether any o f f i c e r , d i r ect o r o r employee o r a t t o rney of

t h e bank h a s accepted favor f o r procuring credi t?

q . Whether bank h a s contracted f o r t h e purchase from any of

i t s

d i r e c t o r s

o r

d i r e c t o r s f i r m s, s ecu r i t i e s

o r

other

p roper ty ,

on

terms less favorable

t o

bank than those

o f -

f e r e d t o o thers? I f so , whether account was authorized

b y ma jo r i ty of the board of d i r e c t o r s n o t i n t e r e s t ed i n

t h e t ransact ion?

X-4747

402

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408

X-4747

EXAMINATIONS (Cont d)

r . Whether bank h a s so ld secu r i t i es o r p roper ty to any d i rector

i n regular course of business on terms more favorable to

such director than offered t o others?

o f f i ce r s

s . Whether bank h a s pa id to any d i r e c t o r , / a t t o r n e y o r employee

a g r ea t e r r a t e of i n t e r e s t on deposi t s of such per son than

^ tha t paid to o ther deposi tors on s imilar deposi ts?

t .

Whether bank

h a s

notified Federal Reserve Board

o f a n y i n -

crease

of

c ap i t a l

o r

surplus

o r

addi t ional stock issues.

Do examiners, du ring t h e examination a nd while a t t h e bank, in qu ir e into

Regulation H - Ten condit ions of membership?

a .

Whether bank

h a s

made

any

change

i n

general character

of

a s s e t s

or in

scope

of

funct ions such

a s

tend

t o

a f f e c t

m a t e r i a l l y i t s standard maintained a t time of admission

t o Federal Reserve System?

b . Whether bank gi ve s due regard t o s a f e t y o f customers?

c .

Whether bank

h a s

reduced capital without permission

of


d . Whether bank h a s establ ished branches, agencies o r add i t ion -

a l of f i c e without permission of Federal Reserve Board?

e . Whether bank h a s consol idated o r absorbed, purchased o r a c -

qui red in teres t i n excess of 20$ in another bank, or d i r e c t l y

o r indirect ly promoted a new bank without permission of the


f . Whether bank ha s a ny excess loans?

g . Whether bank h a s deposits with non-members i n excess of 10$

o f i t s c a p i t a l and surplus?

h .

Whether bank

h a s

accepted

i n

excess

of 50$ of

c ap i t a l

and

surp lus f o r dollar exchange, o r i s gross acceptance greater

than 50$ of c a p i t a l an d surplus, without permission of the


i . Whether board of d i re ct or s have passed res olu t io n authoriz ing

interchange

of

r ep o r t s

and

information between Federal reserve

bank and banking au thor i t ies of s t a t e i n which bank i s located?

j . Whether bank h a s complied with any o ther spe cia l condit ions

which Federal Reserve Board imposed upon i t a t time of admis-

sion to System?

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SXAI,1IHATI0HS( Cont d)

X-4747

404

1 1 . When making examinat ions do Fede ral res erv e examiners examine t r u s t de^-

partments and safekeeping departments - Procedure? A re con t ro l l ing

trust documents studied and under s tood su f f i c i en t ly by examiners t o

give them a practical knowledge of the purposes of the various t rusts?

(See,national bank form

on

t r u s t s ) .

1 3 . When c r e d i t an al ys is i s made do examiners inspect an d pass judgment on

proofs

of

l i ab i l i t i e s passed them

by the

state examiners?

1 3 . When making j o i n t exam ina tions, do state examiners a s k f o r o r expect

as si st an ce from Fed era l re se rv e examiners when ana lys ing loa ns o r

other assets?

14 . How f a r do

Federal reserve examiners rely

on

state examinations?

By

what means do the Federal reserve banks determine whether state exam-

ina t ions a r e adequate f o r their purposes a nd a r e the methods b y which

they determine whether state examinations should b e accepted adequate?

1 5 . Where Federa l re se rv e examiners pa rt ic ip a te with st a te examiners i n

their examinations

of

s ta te member banks does such p a r t i c i p a t i o n

tend to r a i s e t h e s tandard of state examinations?

16. How soon a f t e r examinations a r e reports forwarded to Federal Reserve Agent?

How soon a f t e r examinations a r e reports forwarded t o t h e Federal Reserve

Board? Inclu des s t a t e re pos ts ?

1 7 . When t h e Federal deserve bank receives reports of examinations o r makes

cred i t i nves t iga t ions

o r

o therwise obtains information with relat ion

t o t h e condit ion of a member bank, i s t h e inform ation pro per ly analyzed

and f i l e d so t h a t i t can be readily obtained?

18. Who an aly zes r epo rt s when rec eiv ed? What re co rd s a r e kept ? When i s

th is in form atio n used? How often reviewed?

19 . What re co rd s a r e held b y Federal Reserve Agent of banks examined? Are

they suff ic ien t?

2 0 . What in fo rm at io n i s i n t h e Federal reserve bank a s regards permission

t o exercise trust powers? To accept up to 100$ of c ap i t a l and surplus?

21 . Are the examining fo rc es making adequate c r e d it in ve st ig at io n, which i n -

volve t h e loan pol ic ie s , personnel and o rganizat ion , a s wel l as an

appra i sa l of the a s s e t s of a bank?

2 2 .

When cr ed it an al ys is

i s

made

do

examiners value

and

pass

on a ny o r a l l

as s e t s i n add i t ion to loans and discounts?

2 3 . Describe general determining f ac to r th at prompts you to i n s t i t u t e c r ed i t

invest igat ions?

24. Are

cred i t i nve st iga t io ns conducted re gul ar ly

o f a l l

s t a t e member banks

whether o r n o t substantial borrowers?

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m . * W 7 : ; :

mUMBATIOm (Cont'd)

4 . Q 5

25. Where i s credit information obtained other than from statements - this

includes a l l assets?

26* i r e the

Federal Reserve banks receiving adequate information

as to the

Conditions

of the

state member banks upon which they

may

safely

act

in

extending credit?

V . .

27. Do examiners hold directors meetings in connection with each examination

and credit analysis for the purpose of discussing matters subject to

criticism and informing directors of the general condition of the bank?

28. Do

examiners make

a

study

and

embody

in

report

a

brief economic survey

of

each place

or

section? Does Fetteral Reserve Agent

and

bank have

knowledge

of the

economic conditions under which

the

member bank

Is ,

operating?

29. To

what extent

are

Federal reserve banks aware

of -the

development

of

unfavorable conditions in member banks, through their dally contacts -

cash letters - loans, etc?

30. Are a l l

reports called

for by the

federal Reserve Board verified

a t

time

o f

next examination

or

credit investigation?

31.

Does

th e

Federal Reserve Agent

and

bank receive

a

copy? Aire they

inspected a t time of receipt?

32. Who makes examination when bank i s applying fo r membership? Nature

of

examination?

33. Who in

Federal reserve bank passes upon applications?

34.

Conditions imposed

a t

time

of

application

fo r

admission

- How

followed

up?

38*

What records

are

held pertaining

to

conditions imposed?

I s

Federal

Reserve Board advised whether conditions

are

being followed

up?

36. Are

examiners aware

of

these conditions when making examinations?

37 .

When state authorities accept Federal reserve examinations

and

reports

in lieu of their own,do they, when making own examinations, see that

conditions imposed by Federal Reserve Board are being followed up?

38*

practice

of

Federal Reserve Agent with respect

to

making examinations

and

dealing with unsatisfactory practices

and

conditions

in

state

banks?

In

national banks?

39.

Does Federal Reserve Agent receive copies

of

reports

of

examination

of state bank members from each State Bank Superintendent in the

district?

40.

Does

th e

Federal Reserve Agent

and

bank

get

copies

of

disciplinary

letters written to banks,by state authorities,not l a satisfactory

condition* and the answers received

from

them.

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X-4747

ummATiom cont«a) , 406

How does your treatment of •unsatisfactory conditions differ a s between

borrowing and non-borrowing banks?

Do

both state

and

federal examiners make specific recommendations

in

their reports as to the action which, in their opinion, the bank should

or mast take to correct conditions? What steps are taken by Federal

reserve banks to secure the correction of unsatisfactory conditions

in member banks? How fa r are suggestions and criticisms followed up?

In

general, what

can the

federal Reserve Board

do to

improve examinations

in districts or in states where they are most in need of Improvement?

Obtain information by states or parts o f states in each Federal reserve

district that will give an economic picture of the territories referred

to. •

frsbog_mim_v25_0398.pdf

Documents

s s e t s

i t i e s

s s i s t ance

i s t of banks

s s of banks

i s t s fo r

number of s t

d i s t r i c t