Every reserve bank shall maintain a re serve in gold or lawful money of not less than thirty-five per cent. against its deposits and reserves in gold of not less than forty per cent. against its reserve notes in actual circulation and not offset by gold or lawful money deposited with the federal reserve agent.
The reserve board shall require each re serve bank to maintain on deposit in the United States treasury a sum in gold suffi cient in the judgment of the secretary for the redemption of federal reserve notes and in no event less than five per cent., but such deposit shall be included as part of the forty per cent. reserve above required. Any re serve bank may reduce its liability for out standing reserve notes by depositing with the federal reserve agent, its federal reserve notes, gold, gold certificates or lawful mon ey of the United States. ' Bank Reserves. Demand deposits within the act shall comprise all 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.
After a federal reserve bank is established in any district, every subscribing member bank shall maintain reserves according to an elaborate scheme, as to which reference must be made to the act.
Bank Bownanations. The comptroller, with the approval of the secretary of the treasury, shall appoint examiners, who shall examine every member bank at least twice a year and oftener if necessary ; the reserve board may authorize examination by the state authorities to be accepted in the case of state banks or trust companies and may at any time direct the special examination of state banks or trust companies that are stockholders of a reserve bank.
The reserve board shall at least once a year order an examination of each reserve bank and upon joint application of ten mem ber banks shall order a special examination of and a report upon any such bank.
Loans on Farm Lands. Any national bank not situated in a central reserve city may make loans secured by improved and unin cumbered farm land situate within its re serve district, but not for more than five years nor exceeding one-half of the actual value of the property offered as security. Such loans may be made in an aggregate sum not exceeding twenty-five per cent. of its capital and surplus and one-third of its time deposits. The reserve board shall have power from time to time to add to its list of cities from which its members shall not be permitted to make loans on real estate.
Foreign Branches. Any national bank with a capital and surplus of $1,000,000 or more may apply to the reserve board for au thority to establish branches in foreign coun tries or dependencies of the United States and to act as fiscal agents of the United States.
National banks having circulating notes secured otherwise than by United States bonds shall pay for the first three months a tax at the.rate of three per cent. per annum upon the average amount of such of their notes in circulation as are based on the de posit of such securities, and afterwards an additional tax rate of one-half of one per cent. per annum for each month until a tax of six per cent. per annum is reached, and thereafter a tax of six per cent. per annum upon the average amount of such notes.
Certain changes are made in the national banking act, as to which attention is called to the act.
Finally, if any part of the act shall be ad judged invalid, it shall not affect the remain der of the •act ; the right to alter, amend or repeal the act is expressly reserved.
See DEPOSIT; INTEREST; PROXY; RESERVE; BANK.