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In 1935, what changes were made to the Federal Reserve System?

A central group of banks were authorized to lend to each other in times of need.

The Federal Reserve System was given more centralized power.

There was an increase of Federal District Banks from 10 to 12 banks.

The problems of regional banks were no longer the concern of Federal District Banks.

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In 1935, significant changes were made to the Federal Reserve System, including the following:

  • The Federal Reserve System was given more centralized power. This was primarily accomplished through the Banking Act of 1935, which reorganized the Federal Reserve and aimed to make its governance more effective. It centralized authority by placing more power in the hands of the Board of Governors in Washington, D.C.

To clarify, while the statement about the increase of Federal District Banks from 10 to 12 is incorrect (the original number of districts was already 12), the main takeaway is that the Federal Reserve was indeed given more centralized power through reforms in 1935.

Therefore, the correct statement reflecting the changes made in 1935 is: The Federal Reserve System was given more centralized power.