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U.S. Code as of:
01/19/04
Section 414. Authority of Board of Governors respecting issuance of notes; interest; lien
The Board of Governors of the Federal Reserve System shall have
the right, acting through the Federal Reserve agent, to grant in
whole or in part, or to reject entirely the application of any
Federal Reserve bank for Federal Reserve notes; but to the extent
that such application may be granted the Board of Governors of the
Federal Reserve System shall, through its local Federal Reserve
agent, supply Federal Reserve notes to the banks so applying, and
such bank shall be charged with the amount of the notes issued to
it and shall pay such rate of interest as may be established by the
Board of Governors of the Federal Reserve system on only that
amount of such notes which equals the total amount of its
outstanding Federal Reserve notes less the amount of gold
certificates held by the Federal Reserve agent as collateral
security. Federal Reserve notes issued to any such bank shall, upon
delivery, together with such notes of such Federal Reserve bank as
may be issued under subchapter XIII (!1) of this chapter upon
security of United States 2 per centum Government bonds, become a
first and paramount lien on all the assets of such bank.
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