NATIONAL BANKING UNDER THE FEDERAL RESERVE SYSTEM
shall, upon delivery, together with such notes of such Federal reserve bank as may be
issued under section eighteen of this act upon security of United States two per centum
Government bonds, become a first and paramount lien on all the assets of such bank.
Any Federal reserve bank may at any time reduce its liability for outstanding Fed-
eral reserve notes by depositing with the Federal reserve agent its Federal reserve
notes, gold, gold certificates, or lawful money of the United States. Federal reserve
notes so deposited shall not be reissued, except upon compliance with the conditions
of an original issue.
The Federal reserve agent shall hold such gold, gold certificates, or lawful money
available exclusively for exchange for the outstanding Federal reserve notes when
offered by the reserve bank of which he is a director. Upon the request of the Secretary
of the Treasury the Federal Reserve Board shall require the Federal reserve agent to
transmit to the Treasurer of the United States so much of the gold held by him as
collateral security for Federal reserve notes as may be required for the exclusive pur-
pose of the redemption of such Federal reserve notes, but such gold when deposited
with the Treasurer shall be counted and considered as if collateral security on deposit
with the Federal reserve agent.
Any Federal reserve bank may at its discretion withdraw collateral deposited with
the local Federal reserve agent for the protection of its Federal reserve notes issued to
it and shall at the same time substitute therefor other collateral of equal amount with
the approval of the Federal reserve agent under regulations to be prescribed by the
Federal Reserve Board. Any Federal reserve bank may retire any of its Federal
reserve notes by depositing them with the Federal reserve agent or with the Treasurer
of the United States, and such Federal reserve bank shall thereupon be entitled to
receive back the collateral deposited with the Federal reserve agent for the security of
such notes. Federal reserve banks shall not be required to maintain the reserve or the
redemption fund heretofore provided for against Federal reserve notes which have
been retired. Federal reserve notes so deposited shall not be reissued except upon
compliance with the conditions of an original issue.
All Federal reserve notes and all gold, gold certificates, and lawful money issued to
or deposited with any Federal reserve agent under the provisions of the Federal
reserve act shall hereafter be held for such agent, under such rules and regulations as
the Federal Reserve Board may prescribe, in the joint custody of himself and the
Federal reserve bank to which he is accredited. Such agent and such Federal reserve
bank shall be jointly liable for the safe-keeping of such Federal reserve notes, gold,
gold certificates, and lawful money. Nothing herein contained, however, shall be
construed to prohibit a Federal reserve agent from depositing gold or gold certificates
with the Federal Reserve Board, to be held by such board subject to his order, or with
the Treasurer of the United States for the purposes authorized by law.
In order to furnish suitable notes for circulation as Federal reserve notes, the Comp-
troller of the Currency shall, under the direction of the Secretary of the Treasury,
cause plates and dies to be engraved in the best manner to guard against counterfeits
and fraudulent alterations, and shall have printed therefrom and numbered such
quantities of such notes of the denominations of $5, $10, $20, $50, $100, $500, $1000,
$5000, $10,000 as may be required to supply the Federal reserve banks. Such notes
shall be in form and tenor as directed by the Secretary of the Treasury under the pro-
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