Division of Earnings. Stockholders of re serve banks are entitled to annual cumula tive dividends of six per cent. after the pay ment of which the remaining net earnings shall be paid to the United States as a fran chise tax, except that one-half thereof shall be paid into a surplus fund until it shall amount to forty per cent. of the paid-in cap ital of such bang.
Reserve banks, including the stock, sur plus and income, shall be exempt from all taxation except on real estate.
R. S. § 5154, is amended to provide that any bank incorporated under special or gen eral law of any state or of the United States and having an unimpaired capital sufficient to entitle it to become a national bank may, by a vote of not less than fifty-one per cent. of the capital stock and the approval of the Comptroller, become a national bank, if such conversion shall not be in contravention of the state law.
State Banks as Members. Any bank in corporated by special law of any state or organized under the general laws of any state or of the United States may apply to the committee or to the reserve board for the right to subscribe for reserve bank stock within its district, but the applying bank must have a paid-up unimpaired capital suf ficient to entitle it to become a national bank.
Power is given in certain cases to the re serve board to require member banks to sur render their stock in the reserve bank upon repayment of the cash-paid subscriptions as aforesaid, less any liability to the reserve bank except for subscriptions not previously called. The reserve board may in a proper case restore the membership.
A federal reserve board is created, which shall consist of the secretary of the treasury, the comptroller of the currency, ex officio, and five members appointed by the president by and with the advice and consent of the senate. Not more than one of such five ap pointive members shall be selected from any reserve district, and the president shall have due regard to a fair representation of the different commercial, industrial and geo graphical divisions of the country. The five appointive members shall receive salaries of $12,000, and the comptroller shall receive $7,000 for his services as a member of the board. At least two of such five members shall be "persons experienced in banking or finance." One shall be designated by the president to serve for two years, one for four years, one for six years; one for eight years and one for ten years. Thereafter the terms shall be ten years, unless sooner removed for cause by the president. One of the persons shall be designated by the president as gov ernor and one as vice-governor of the board.
Nothing in the act shall take away any powers heretofore vested in the secretary of the treasury in regard to the treasury de partment, and wherever any power vested by this act in the reserve board or the re serve agent appears to conflict with the pow ers of the secretary of the treasury, such powers shall be exercised subject to the su pervision and control of the secretary.
A bureau in the treasury department is created, charged with. the execution of all laws relating to the issue and regulation of national currency, etc.; the comptroller of the currency is to be chief of such bureau.
The reserve board is empowered to ex amine the accounts, books and affairs of each federal reserve bank and each mem ber bank and to require such statements and reports as it may deem necessary ; it shall publish once a week a statement .showing the condition of each reserve bank and a consolidated statement of all reserve banks. It may permit or, on the affirmative note of at least five of its members, require reserve banks to rediscount the discounted paper of other reserve banks, at rates of interest to be fixed by it.
It may suspend for a period not exceed ing thirty days, and from time to time re new such suspension for periods not exceed ing fifteen days, "any reserve requirement specified in this act," but with certain pro visos.
It may add to the number of reserve cities or central reserve cities or reclassify them.
It may remove or suspend any officer or director of any reserve bank. It may re quire the writing off of doubtful or worth less assets by any reserve bank; for any vio lation of the act suspend the operations of any reserve bank, take possession thereof, administer the same, and liquidate or re organize it. It has general supervision over reserve banks. It may grant by special per mit to national banks applying therefor, wheri not in contravention of state or local law, the right to act as trustee. executor. ad ministrator, or registrar of stocks and bonds. Federal Advisory Council. A "federal ad is created to consist of as many members as there are federal reserve districts. Each federal reserve bank ap points one member thereof. The council meets at Washington at least four times a year and oftener if called by the reserve board, and it may meet there or elsewhere as they may deem necessary. It has power to confer directly with the reserve hoard on general business conditions, to make oral or written representations concerning matters within the jurisdiction of the board, to call for information and to make recommenda tions in regard to discount rates, rediscount business, note issues, reserve conditions in the various districts, the purchase and sale of gold or securities by reserve banks, open market operations by said banks and the general affairs of the reserve banking sys tem.