First Revision of Sec. 27


First Revision of Sec. 27


Strong, Benjamin, 1872-1928




No date


Benjamin Strong Jr. Papers, New York Federal Reserve Bank





Sec. 27. That the bank shall from time to time purchase from the several national banks at prices not over exceeding par and accured interest two per cent. bonds of the United States up to an amount not exceeding one-half of the total of such bonds on deposit at the date of the organization of the Bank with the Treasurer of the United States to secure circulation of such national banks. Such purchases shall be made from the several national banks up to amounts not exceeding the par value of one-half of the amounts of bonds owned by the respective national banks and securing their circulations outstanding at the date of the organization of the Bank, and thereupon the Bank shall be responsible for the redemption and retirement of the notes of each such national bank to the amount of the purchase price of the bonds, less interest, so purchased from it, which responsibility shall constitute payment to such national banks, respectively, for such bonds.Immedoiately after purchasing such bonds, the Bank shall, under regulations to be prescribed by the Secretary of the Treasury and the Board, exchange such bonds with the Comptroller Treasurer of the United States for an equal amount at par of rRefunding Notes hereinbefore authorized and upon the maturity of any such Refunding Notes the Bank shall pay such Notes, for the account of the United States, to the holders thereof, but it shall, at the option of the Secretary of the Treasury, for a period of twenty years from the date of the organization of the Bank, in lieu of reimbursement for such payments, accept in exchange for such Notes new Refunding Notes of an equal aggregate amount and of analagous form and tenor. The Bank shall pay semi-annually to the United States, out of its earnings and before reimbursement of advances made by the United States under the provisions of Sec. of this Act, a tax upon its circulating notes equal to an amount of one and one-half per cent. per annum, calculated upon the amount of refunding notes from time to time so outstanding.

Original Format




Strong, Benjamin, 1872-1928, “First Revision of Sec. 27,” No date, WWP18857, Benjamin Strong Jr. Papers, Woodrow Wilson Presidential Library & Museum, Staunton, Virginia.