NATIONAL BANKING UNDER THE FEDERAL RESERVE SYSTEM 
for the purpose of conducting or settling accounts resulting from a 
transaction or transactions involving any one of the following: 
(a) The shipment of goods between the United States and any foreign country, 
or between the United States or any of its dependencies, or between foreign 
countries; 
(b) The shipment of goods within the United States, providing shipping docu- 
ments conveying security title are attached at the time of acceptance; | 
(c) The storage of readily marketable staples,’ providing the bill is secured at 
the time of acceptance by a warehouse receipt, or other such document con- 
veying security title. 
In order to be eligible, acceptances for any one customer in excess 
of 10 per cent. of the capital and surplus of the accepting bank must 
remain actually secured throughout the life of the acceptance. In 
the case of acceptances of member banks this security must consist 
of shipping documents, warehouse receipts or other such documents, 
or some other actual security growing out of the same transaction as 
the acceptance. 
Although a Federal Reserve Bank may legally rediscount an ac- 
ceptance having a maturity at the time of not more than 90 days, 
or six months in case of agricultural acceptance, it may decline to 
rediscount any acceptance the maturity of which is in excess of the 
usual or customary period of credit required to finance the underlying 
transaction or which is in excess of that period reasonably necessary 
to finance such transaction. 
Special conditions of eligibility for rediscount by the Federal 
Reserve Bank are laid down in greater detail by the Federal Reserve 
Board. 
111 
Bills of exchange, trade acceptances, and bankers’ 
acceptances purchased in the open market 
by the Federal Reserve Bank 
The Federal Reserve Banks may, under rules and regulations pre- 
scribed by the Federal Reserve Board, purchase and sell in the open 
market, at home or abroad, from or to domestic or foreign banks, 
firms, corporations, or individuals, bankers’ acceptances and bills of 
18ee note, page 74. 
79