By member banks classified in Group 1 on October 21, 1997, that is, member banks with capital and surplus of more than $1 billion on that date)

To the Member Banks of the Second Federal Reserve District:

In accordance with section 4 of the Federal Reserve Act, as amended, and Circular No. 10989, dated October 21, 1997, on the nomination of directors of this Bank for terms of office ending December 31, 2000, to succeed J. Carter Bacot, class A director, and Eugene R. McGrath, class B director, whose terms expire December 31, 1997, there are shown on the following pages the names of the candidates nominated for such offices, and by whom nominated.

To each member bank classified in Group 1 on October 21, 1997, the following are being sent with this circular:

1. Ballot for use in voting for candidates for class A director and class B director.
2. Pink ballot envelope in which the ballot is to be sealed.
3. Certificate envelope bearing on its face the certificate in regard to the vote.
4. Addressed envelope in which all of the foregoing should be returned to me.

The ballot and the certificate on the certificate envelope must be executed by an officer who has been authorized to cast the vote. A list of the officers designated for this purpose by the member banks in Group 1 was contained in the above-mentioned circular dated October 21, 1997; the list is also contained herein. In order that the ballot may be secret, the name of the bank and the name and title of the voting officer should not be written on the ballot, but should be written only on the certificate envelope.

1. The ballot should be marked.
2. The marked ballot should be placed in the pink ballot envelope and that envelope sealed.
3. Then the sealed pink ballot envelope should be placed within the certificate envelope, and the certificate envelope should be sealed and the certificate thereon executed.
4. Then the certificate envelope containing the sealed pink ballot envelope should be returned to me in the enclosed addressed envelope.

The law provides that the ballot shall be cast within 15 days after receipt of the list of candidates transmitted herewith. The polls will open at 10 a.m., December 1, 1997, and will close at 12 noon on Tuesday, December 16, 1997, and in order to be counted as valid the ballot must be received at or before the latter time. Upon the closing of the polls the ballot box will be opened, the votes counted and checked by tellers, and the results of the election announced. The candidates may, if they so desire, be present or represented on this occasion. Because banks in Groups 2 and 3 will not vote in this election, this circular is sent to them without forms and for their information only.

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Candidate for Class A Director

WALTER V. SHIPLEY
Chairman and Chief Executive Officer
The Chase Manhattan Bank
New York, New York

WALTER V. SHIPLEY was born in Newark, New Jersey, on November 2, 1935. He attended Williams College and received a B.S. degree from New York University in 1961.

Mr. Shipley joined Chemical Bank in 1956. He became president of Chemical in 1982 and chairman in 1983. After the bank merged with Manufacturers Hanover Trust Company, Mr. Shipley became president of the merged bank in 1992 and its chairman and chief executive officer in 1994. He has served as chairman and chief executive officer of The Chase Manhattan Bank since the merger with Chemical in April 1996.

Mr. Shipley is a director of Champion International Corporation, Bell Atlantic Corporation, and the Reader's Digest Association, Inc. Among his civic activities, he is president and a director of Goodwill Industries of Greater New York, Inc., and serves on the boards of Lincoln Center for the Performing Arts Inc., the New York City Partnership and Chamber of Commerce, United Way of Tri-State, and United Cerebral Palsy Research and Educational Foundation Inc. He is on the Board of Trustees of the American Museum of Natural History and is a member of The Bankers Roundtable, The Business Roundtable, The Business Council, and the U.S.-Japan Business Council.

Mr. Shipley has also served as President of the Federal Advisory Council in 1997.

Nominated by the following member banks in Group 1

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NEW YORK

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Candidate for Class B Director

EUGENE R. McGRATH
Chairman, President, and Chief Executive Officer
Consolidated Edison Company of New York, Inc.
New York, New York

EUGENE R. McGRATH was born in New York City on February 4, 1942. He received a mechanical engineering degree from Manhattan College in 1963 and an M.B.A. from Iona College in 1980. He also completed the Advanced Management Program at Harvard University in 1989.

Mr. McGrath began his career with Con Ed in 1963, holding positions in the utility's major operating and customer service areas and managing the fossil-fired and nuclear generating plants. He was elected vice president in 1978, senior vice president in 1981, executive vice president in 1982, and president and chief operating officer in 1989. He has been chairman, president, and chief executive officer since 1990.

Among his civic affiliations, Mr. McGrath is chairman of the Empire State Business Alliance and co-chairman of the 14th Street-Union Square Local Development Corporation. He is a director of the American Museum of Natural History, the American Woman's Economic Development Corporation, the Atlantic Mutual Insurance Company, Barnard College, the Business Council of New York State, the Committee for Economic Development, the Cornell/Foundation House Experiments in Distance Learning, the Fresh Air Fund, the Hudson River Foundation for Science and Environmental Research, Inc., Manhattan College, the National Action Council for Minorities in Engineering, the New York City Partnership and Chamber of Commerce, the New York City Public/Private Initiatives, Inc., the United Way of New York City, the United Way of Tri-State, and the Wildlife Conservation Society. Within the energy industry, Mr. McGrath is a member of the Energy Association of New York State and the Executive Committee of the New York Power Pool. He is a director of the Advanced Reactor Corporation, the American Gas Association, the Association of Edison Illuminating Companies, the Electric Power Research Institute, the Utility Business Education Coalition and the Edison Electric Institute.

Mr. McGrath is currently a class B director of the Federal Reserve Bank of New York for the term ending December 31, 1997.

Nominated by the following member banks in Group 1

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NEW YORK

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Election of Directors

For Terms of Office Ending December 31, 2000

List of the 8 Member Banks in Group 1

(Group 1 consists of member banks with capital and surplus of more than $1 billion, as of October 21, 1997.)

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NEW JERSEY

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NEW YORK

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NEW YORK CITY

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