FepERAL RESERVE ACT
hundred miles of the place in which said bank may be located, receiving for such services
a reasonable fee or commission: Provided, however, That no such bank shall in any case
guarantee either the principal or interest of any such loans or assume or guarantee the
payment of any premium on insurance policies issued through its agency by its princi-
pal: And provided further, That the bank shall not guarantee the truth of any statement
made by an assured in filing his application for insurance.
Any member bank may accept drafts or bills of exchange drawn upon it having not
more than three months’ sight to run, exclusive of days of grace, drawn under regula-
tions to be prescribed by the Federal Reserve Board by banks or bankers in foreign
countries or dependencies or insular possessions of the United States for the purpose of
furnishing dollar exchange as required by the usages of trade in the respective countries,
dependencies, or insular possessions. Such drafts or bills may be acquired by Federal
reserve banks in such amounts and subject to such regulations, restrictions, and limita-
tions as may be prescribed by the Federal Reserve Board: Provided, however, That no
member bank shall accept such drafts or bills of exchange referred to in this paragraph
for any one bank to an amount exceeding in the aggregate ten per centum of the paid-
up and unimpaired capital and surplus of the accepting bank unless the draft or bill of
exchange is accompanied by documents conveying or securing title or by some other
adequate security: Provided further, That no member bank shall accept such drafts or
bills in an amount exceeding at any time the aggregate of one-half of its paid-up and
unimpaired capital and surplus.
Added by act approved Mar, §, 1923.
Sec. 13a. Upon the indorsement of any of its member banks, which shall be deemed
2 waiver of demand, notice, and protest by such bank as to its own indorsement exclu-
sively, any Federal reserve bank may, subject to regulations and limitations to be pre-
scribed by the Federal Reserve Board, discount notes, drafts, and bills of exchange
issued or drawn for an agricultural purpose, or based upon live stock, and having a
maturity, at the time of discount, exclusive of days of grace, not exceeding nine months,
and such notes, drafts, and bills of exchange may be offered as collateral security for the
issuance of Federal reserve notes under the provisions of section 16 of this Act: Pro-
vided, That notes, drafts, and bills of exchange with maturities in excess of six months
shall not be eligible as a basis for the issuance of Federal reserve notes unless secured
by warehouse receipts or other such negotiable documents conveying or securing title
to readily marketable staple agricultural products or by chattel mortgage upon live
stock which is being fattened for market.
That any Federal reserve bank may, subject to regulations and limitations to be pre-
scribed by the Federal Reserve Board, rediscount such notes, drafts, and bills for any
Federal Intermediate Credit Bank, except that no Federal reserve bank shall rediscount
for a Federal Intermediate Credit Bank any such note or obligation which bears the
indorsement of a nonmember State bank or trust company which is eligible for mem-
bership in the Federal reserve system, in accordance with section 9 of this Act.
Any Federal reserve bank may also buy and sell debentures and other such obliga-
tions issued by a Federal Intermediate Credit Bank or by a National Agricultural
Credit Bank or by a National Agricultural Credit Corporation, but only to the same
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