1863 Passage of the National Bank Act 1864. Thorough revision and strengthening of the Act 1866 Complete Monopoly of note issue given to the national banks 1874 Substitution of a 5% redemption fund in the Treasury for a required reserve against national bank notes 1900 National bank notes could be issued up to 100% of the bonds back of thdm, instead of 90%, as before. Minimum capital requirement reduced from $50,000 to |25,000 for banks in small towns. 1913 Many important changes made by Fed. Res. Act: (1) pover granted to natl. banks to rediscount paper with newly established Reserve banks; (2) reserve requirements reduced and much lower requirement at- tached to time deposits; A3) natl. banks required to joint Fed. Res. System; (4) powers of natl. banks extended to making loans on real estate, accepting bills drawn in foreign trade, engaging in trust and savings business. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis 1916 Reserve Act revised to permit members to borrow on their ovn promissory notes secured by obligations of the government or by eligible paper. Power to ac- cept drafts broadened to include domestic shipments, commodities in storage, and the creation of dollar exchange. 1917 Reserve requirements of member banks further reduced, and whole of the required reserve had to be carried in Reserve Banks 1927 McFadden Pepper Act. Natl, banks permitted to retail existing branches but acquisition of others confined to city in which head office was located. No branches permitted where state banks were forbidden to establish them. Further leeway granted with respect to loans upon real estate. National banks permitted to enter field of investment banking. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis 1933 Federal Deposit Guaranty system established. Natl* bank permitted to exercise same freedom re creation of branches as is accorded to state ba banks in the state where natl. bank is situated. Natl* banks must conform to capital and other re- quirements laid down by the Federal Government. Minimum capitalization increased to $50,000 for new natl. banks. Double liability abolished on new stock. Regulation and supervision imposed upon chain and group banking. Payment of interest on demand deposits forbidden and rates paid on time deposits subjected to regulation by B/G of FRS. Restrictions placed upon purchases of securities by member banks. Members were required to dispose of their investment depts. or affiliates. Guaranty of bank deposits introduced through establishment of Federal Deposit Insurance Corporation. An emergency banking act, also in 1933, authorized the issue of cumulative preferred stock by natl. banks, in order to improve the ratio of capital to deposit liabilities. Officers and directors of banks may be f 1 removed by B/G for unsound practices. Member banks forbidden to lend to their officers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis 1935 National bank notes abolished* B/G of FRS given permanent power to change reserve requirements; power to make loans on real estate considerably extended. Double liability of stockholders abolished for all stock. Required surplus in- creased to 10056 of the capital stock. Maximum amount of deposit guaranteed by F.D.I.C. set at |5,000 and required annual premium fixed at 1/12 of 1% of the insured ban&s deposits. Direct loans from a Reserve bank may be obtained for as long as A months, and on any sort of collateral acceptable to the Reserve bank. Loans to of- ficers permitted, but not to exceed $2,500. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis AILES, M. 5. National banking system and federal bond issues, THE ANNALS OF THE AMERICAN ACADEMY OP POLITICAL & SOCIAL SCIENCE, XXXVI, 1910, pp. 592-606. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis ANDERSON, George L. Western Attitude toward National Banks, 1873-1874. paper presented at annual meeting of the MISSISSIPPI VALLEY HISTORICAL ASSOCIATION, 27th annuel meeting at Columbia, Missouri, April 26-28, 1934. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis ANDERSON, G. La V. THE NATIONAL BANKING SYSTEM, 1865-1875, A SECTIONAL INSTITUTION. Urbana, I l l i n o i s : 1933. 9 pp. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis Anonymous History of the national banking system, RAND-MGNALLT BANKERS MONTHLY, December, 1<?04. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis BOLLES, A. S. THE NATIONAL BANK ACT AND ITS JUDICIAL MEANING, WITH AN APPENDIX. New York: 1st ed., 1333. Pp. xix, 375 (Supplement) 1392. Philadelphia: 4th ed., 1910. Pp. lvi, 556. Indianapolis: 10th ed., 1900. 11th ed., new and enl., 1903. Pp. ix, 491. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis &„. , . , l<r„X U . * f ^ ' lUe }0*biMo\ Qo^Ki-?^ Jt^s/eu*. • /i ft UiLAVO^f Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis