§ 1972. Certain tying arrangements prohibited; correspondent accounts

Legislative history

Reconstructed from this section’s Code source credit and amendment notes, resolved against the local Statutes at Large. Editorial notes are evidence, not the law that made the change.

1. 1970

   Bank Holding Company Act Amendments of 1970

   Pub. L. 91–607 title I § 106(b) · 84 Stat. 1760

   Enacted · 12 U.S.C. § 1972

   Pub. L. 91–607, title I, § 106(b), Dec. 31, 1970, 84 Stat. 1766

   Source evidence

   Code source credit
   Pub. L. 91–607, title I, § 106(b), Dec. 31, 1970, 84 Stat. 1766

   Enacted provision · exact public law section
   (b) A bank shall not in any manner extend credit, lease or sell property of any kind, or furnish any service, or fix or vary the consideration for any of the foregoing, on the condition or requirement— (1) that the customer shall obtain some additional credit, property, or service from such bank other than a loan, discount, deposit, or trust service; (2) that the customer shall obtain some additional credit, property, or service from a bank holding company of such bank, or from any other subsidiary of such bank holding company; (3) that the customer provide some additional credit, property, or service to such bank, other than those related to and usually provided in connection with a loan, discount, deposit, or trust service; (4) that the customer provide some additional credit, property, or service to a bank holding company of such bank, or to any other subsidiary of such bank holding company; or (5) that the customer shall not obtain some other credit, property, or service from a competitor of such bank, a bank holding company of such bank, or any subsidiary of such bank holding company, other than a condition or requirement that such bank shall reasonably impose in a credit transaction to assure the soundness of the credit. The Board may by regulation or order permit such exceptions to the Exceptions. foregoing prohibition as it considers will not be contrary to the purposes of this section.

2. 1978

   Financial Institutions Regulatory and Interest Rate Control Act of 1978

   Pub. L. 95–630 title VIII § 801 · 92 Stat. 3641

   1. Amended · 12 U.S.C. § 1972

      Pub. L. 95–630 designated existing provisions as par. (1)

   2. Redesignated · 12 U.S.C. § 1972

      Pub. L. 95–630 redesignated former pars. (1) to (5) as subpars. (A) to (E)

   3. Added · 12 U.S.C. § 1972

      Pub. L. 95–630 added par. (2)

   Source evidence

   Code amendment note
   Pub. L. 95–630 designated existing provisions as par. (1), redesignated former pars. (1) to (5) as subpars. (A) to (E), and added par. (2).

   Enacted provision · exact public law section
   Sec. 801. Section 106(b) of the Bank Holding Company Act Amendments of 1970 (12 U.S.C. 1972) is amended by redesignating paragraphs (1) through (5) as subparagraphs (A) through (E), respectively, by inserting “(1)” immediately after “(b)”, and by inserting at the end thereof the following new paragraph: “(2) (A) No bank which maintains a correspondent account in the name of another bank shall make an extension of credit to an executive officer or director of, or to any person who directly or indirectly or acting through or in concert with one or more persons owns, controls, or has the power to vote more than 10 per centum of any class of voting securities of, such other bank unless such extension of credit is made on substantially the same terms, including interest rates and collateral as those prevailing at the time tor comparable transactions with other persons and does not involve more than the normal risk of repayment or present other unfavorable features. “(B) No bank shall open a correspondent account at another bank while such bank has outstanding an extension of credit to an executive officer or director of, or other person who directly or indirectly or acting through or in concert with one or more persons owns, controls, or has the power to vote more than 10 per centum of any class of voting securities of, the bank desiring to open the account, unless such extension of credit was made on substantially the same terms, including interest rates and collateral as those prevailing at the time for comparable transactions with other persons and does not involve more than the normal risk of repayment or present other unfavorable features. “(C) No bank which maintains a correspondent account at another bank shall make an extension of credit to an executive officer or director of, or to any person who directly or indirectly acting through or in concert with one or more persons owns, controls, or has the power to vote more than 10 per centum of any class of voting securities of, such other bank, unless such extension of credit is made on substantially the same terms, including interest rates and collateral as those prevailing at the time for comparable transactions with other persons and does not involve more than the normal risk of repayment or present other unfavorable features. “(D) No bank which has outstanding an extension of credit to an executive officer or director of, or to any person who directly or indirectly or acting through or in concert with one or more persons owns, controls, or has the power to vote more than 10 per centum of any class of voting securities of, another bank shall open a correspondent account at such other bank, unless such extension of credit was made on substantially the same terms, including interest rates and collateral as those prevailing at the time for comparable transactions with other persons and does not involve more than the normal risk of repayment or present other unfavorable features. “(E) For purposes of this paragraph, the term ‘extension of “Extension of credit” and “executive officer.” credit’ shall have the same meaning given it in section 23A of the Federal Reserve Act and the term ‘executive officer’ shall have the same meaning given it under section 22(g) of the Federal Reserve Act. “(F) (i) Any bank which violates or any officer, director, employee, Civil penalty. agent, or other person participating in the conduct of the affairs of such bank who violates any provision of section 106(b)(2) shall forfeit and pay a civil penalty of not more than $1,000 per day for each day during which such violation continues. The penalty shall be assessed and collected Notice. by the Comptroller of the Currency in the case of a national bank, the Board in the case of a State member bank, or the Federal Deposit Insurance Corporation in the case of an insured nonmember State bank, by written notice. As used in this section, the term ‘violates’ “Violates.” includes without any limitation any action (alone or with another or others) for or toward causing, bringing about, participating in, counselling, or aiding or abetting a violation. “(ii) In determining the amount of the penalty the Comptroller of the Currency, the Board or the Federal Deposit Insurance Corporation, as the case may be, shall take into account the appropriateness of the penalty with respect to the size of the financial resources and good faith of the bank or person charged, the gravity of the violation, the history of previous violations, and such other matters as justice may require. “(iii) The bank or person assessed shall be afforded an opportunity for agency hearing, upon request made within ten days after issuance of the notice of assessment. In such hearing, all issues shall be determined on the record pursuant to section 554 of title 5, United States Code. The agency determination shall be made by final order which may be reviewed only as provided in subsection (iv). If no hearing is requested as herein provided, the assessment shall constitute a final and unappealable order. “(iv) Any bank or person against whom an order imposing a civil money penalty has been entered after agency hearing under this section may obtain review by the United States court of appeals for the circuit in which the home office of the bank is located, or the United States Court of Appeals for the District of Columbia Circuit, by filing a notice of appeal in such court within ten days from the date of such order, and simultaneously sending a copy of such notice by registered or certified mail to the Comptroller of the Currency, the Board or the Federal Deposit Insurance Corporation, as the case may be. Certification. The Comptroller of the Currency, the Board or the Federal Deposit Insurance Corporation, as the case may be, shall promptly certify and file in such court the record upon which the penalty was imposed, as provided in section 2112 of title 28, United States Code. The findings of the Comptroller of the Currency, the Board or the Federal Deposit Insurance Corporation, as the case may be, shall be set aside if found to be unsupported by substantial evidence as provided by section 706(2)(E) of title 5, United States Code. “(v) If any bank or person fails to pay an assessment after it has become a final and unappealable order, or after the court of appeals has entered final judgment in favor of the agency, the Comptroller of the Currency, the Board or the Federal Deposit Insurance Corporation, as the case may be, shall refer the matter to the Attorney General, who shall recover the amount assessed by action in the appropriate United States district court. In such action the validity and apropriateness of the final order imposing the penalty shall not be subject to review. “(vi) The Comptroller of the Currency, the Board and the Federal Deposit Insurance Corporation shall promulgate regulations establishing procedures necessary to implement this section. “(vii) All penalties collected under authority of this section shall be covered into the Treasury of the United States. “(G) (i) Each executive officer and each stockholder of record who directly or indirectly owns, controls, or has the power to vote more than 16 per centum of any class of voting securities of an insured bank shall make a written report to the board of directors of such bank for any year during which such executive officer or shareholder has outstanding an extension of credit from a bank which maintains a corresponding account in the name of such bank. Such report shall include the following information: “(1) the maximum amount of indebtedness to the bank maintaining the correspondent account during such year of (a) such executive officer or stockholder of record, (b) each company controlled by such executive officer or stockholder, or (c) each political or campaign committee the funds or services of which will benefit such executive officer or stockholder, or which is controlled by such executive officer or stockholder; “(2) the amount of indebtedness to the bank maintaining the correspondent account outstanding as of a date not more than ten days prior to the date of filing of such report of (a) such executive officer or stockholder of record, (b) each company controlled by such executive officer or stockholder, or (c) each political or campaign committee the funds or services of which will benefit such executive officer or stockholder; “(3) the range of interest rates charged on such indebtedness of such executive officer or stockholder of record; and “(4) the terms and conditions of such indebtedness of such executive officer or stockholder of record. “(ii) Each insured bank shall compile the reports filed pursuant to Reports compilation. subparagraph (G)(i) and forward such compilation to the Comptroller of the Currency in the case of a national bank, the Board in the case of a State member bank, and the Federal Deposit Insurance Corporation in the case of an insured nonmember State bank. “(iii) Each insured bank shall include in the report required to be made under subsection (k)(1) of the Federal Deposit Insurance Act (12 U.S.C. 1817(k)(1)) a list by name of each executive officer or stockholder of record who directly or indirectly owns, controls, or has the power to vote more than 10 per centum of any class of voting securities of the bank who files information required by subparagraph (G)(i) and the aggregate amount of all extensions of credit by correspondent banks to such executive officers or stockholders of record, any company controlled by such executive officers or stockholders, and any political or campaign committee the funds or services of which will benefit such executive officers or stockholders, or which is controlled by such executive officers or stockholders.”.

3. 1982

   Garn-St Germain Depository Institutions Act of 1982

   Pub. L. 97–320 § 428(a)(1) · 96 Stat. 1469

   Inserted · 12 U.S.C. § 1972(2)(A)(D)

   Pub. L. 97–320, § 428(a)(1)–(4), inserted “or to any related interest of such person” after “such other bank” in subpar. (A), “desiring to open the account” in subpar. (B), “such other bank” in subpar. (C), and “another bank” in subpar. (D)

   Source evidence

   Code amendment note
   Par. (2)(A) to (D). Pub. L. 97–320, § 428(a)(1)–(4), inserted “or to any related interest of such person” after “such other bank” in subpar. (A), “desiring to open the account” in subpar. (B), “such other bank” in subpar. (C), and “another bank” in subpar. (D).

   Enacted provision · exact public law section
   (1) by inserting in subparagraph (A) after the phrase “such other bank” the phrase “or to any related interest of such person”;

4. 1982

   Garn-St Germain Depository Institutions Act of 1982

   Pub. L. 97–320 § 410(f) · 96 Stat. 1469

   Substituted · 12 U.S.C. § 1972(2)(E)

   Pub. L. 97–320, § 410(f), substituted “the meaning prescribed by the Board pursuant to section 375b of this title” for “the same meaning given it in section 371c of this title”

   Source evidence

   Code amendment note
   Par. (2)(E). Pub. L. 97–320, § 410(f), substituted “the meaning prescribed by the Board pursuant to section 375b of this title” for “the same meaning given it in section 371c of this title”.

   Enacted provision · exact public law section
   Sec. 410. banking affiliates (a) This section may be cited as the “Banking Affiliates Banking Affiliates Act of 1982. 12 USC 226 note. Act of 1982”. (b) Section 23A of the Federal Reserve Act (12 U.S.C. 3710 is amended to read as follows: “Sec. 23A. (a) Restrictions on Transactions with Affiliates.— “(1) A member bank and its subsidiaries may engage in a covered transaction with an affiliate only if— “(A) in the case of any affiliate, the aggregate amount of covered transactions of the member bank and its subsidiaries will not exceed 10 per centum of the capital stock and surplus of the member bank; and “(B) in the case of all affiliates, the aggregate amount of covered transactions of the member bank and its subsidiaries will not exceed 20 per centum of the capital stock and surplus of the member bank. “(2) For the purpose of this section, any transaction by a member bank with any person shall be deemed to be a transaction with an affiliate to the extent that the proceeds of the transaction are used for the benefit of, or transferred to, that affiliate. “(3) A member bank and its subsidiaries may not purchase a low-quality asset from an affiliate unless the bank or such subsidiary, pursuant to an independent credit evaluation, committed itself to purchase such asset prior to the time such asset was acquired by the affiliate. “(4) Any covered transactions and any transactions exempt under subsection (d) between a member bank and an affiliate shall be on terms and conditions that are consistent with safe and sound banking practices. “(b) Definitions.— For the purpose of this section— “(1) the term ‘affiliate’ with respect to a member bank means— “(A) any company that controls the member bank and any other company that is controlled by the company that controls the member bank; “(B) a bank subsidiary of the member bank; “(C) any company— “(i) that is controlled directly or indirectly, by a trust or otherwise, by or for the benefit of shareholders who beneficially or otherwise control, directly or indirectly, by trust or otherwise, the member bank or any company that controls the member bank; or “(ii) in which a majority of its directors or trustees constitute a majority of the persons holding any such office with the member bank or any company that controls the member bank; “(D) (i) any company, including a real estate investment trust, that is sponsored and advised on a contractual basis by the member bank or any subsidiary or affiliate of the member bank; or “(ii) any investment company with respect to which a member bank or any affiliate thereof is an investment advisor as defined in section 2(a)(20) of the Investment 15 USC 80a–2. Company Act of 1940; and “(E) any company that the Board determines by regulation or order to have a relationship with the member bank or any subsidiary or affiliate of the member bank, such that covered transactions by the member bank or its subsidiary with that company may be affected by the relationship to the detriment of the member bank or its subsidiary; and “(2) the following shall not be considered to be an affiliate: “(A) any company, other than a bank, that is a subsidiary of a member bank, unless a determination is made under paragraph (1)(E) not to exclude such subsidiary company from the definition of affiliate; “(B) any company engaged solely in holding the premises of the member bank; “(C) any company engaged solely in conducting a safe deposit business; “(D) any company engaged solely in holding obligations of the United States or its agencies or obligations fully guaranteed by the United States or its agencies as to principal and interest; and “(E) any company where control results from the exercise of rights arising out of a bona fide debt previously contracted, but only for the period of time specifically authorized under applicable State or Federal law or regulation or, in the absence of such law or regulation, for a period of two years from the date of the exercise of such rights or the effective date of this Act, whichever date is later, subject, upon application, to authorization by the Board for good cause shown of extensions of time for not more than one year at a time, but such extensions in the aggregate shall not exceed three years; “(3) (A) a company or shareholder shall be deemed to have control over another company if— “(i) such company or shareholder, directly or indirectly, or acting through one or more other persons owns, controls, or has power to vote 25 per centum or more of any class of voting securities of the other company; “(ii) such company or shareholder controls in any manner the election of a majority of the directors or trustees of the other company; or “(iii) the Board determines, after notice and opportunity for hearing, that such company or shareholder, directly or indirectly, exercises a controlling influence over the management or policies of the other company; and “(B) notwithstanding any other provision of this section, no company shall be deemed to own or control another company by virtue of its ownership or control of shares in a fiduciary capacity, except as provided in paragraph (1)(C) of this subsection or if the company owning or controlling such shares is a business trust; “(4) the term ‘subsidiary’ with respect to a specified company means a company that is controlled by such specified company; “(5) the term ‘bank’ includes a State bank, national bank, banking association, and trust company; “(6) the term ‘company’ means a corporation, partnership, business trust, association, or similar organization and, unless specifically excluded, the term ‘company’ includes a ‘member bank’ and a ‘bank’; “(7) the term ‘covered transaction’ means with respect to an affiliate of a member bank— “(A) a loan or extension of credit to the affiliate; “(B) a purchase of or an investment in securities issued by the affiliate; “(C) a purchase of assets, including assets subject to an agreement to repurchase, from the affiliate, except such purchase of real and personal property as may be specifically exempted by the Board by order or regulation; “(D) the acceptance of securities issued by the affiliate as collateral security for a loan or extension of credit to any person or company; or “(E) the issuance of a guarantee, acceptance, or letter of credit, including an endorsement or standby letter of credit, on behalf of an affiliate; “(8) the term ‘aggregate amount of covered transactions’ means the amount of the covered transactions about to be engaged in added to the current amount of all outstanding covered transactions; “(9) the term ‘securities’ means stocks, bonds, debentures, notes, or other similar obligations; and “(10) the term ‘low-quality asset’ means an asset that falls in any one or more of the following categories: “(A) an asset classified as ‘substandard’, ‘doubtful’, or ‘loss’ or treated as ‘other loans especially mentioned’ in the most recent report of examination or inspection of an affiliate prepared by either a Federal or State supervisory agency; “(B) an asset in a nonaccrual status; “(C) an asset on which principal or interest payments are more than thirty days past due; or “(D) an asset whose terms have been renegotiated or compromised due to the deteriorating financial condition of the obligor. “(c) Collateral for Certain Transactions With Affiliates.— “(1) Each loan or extension of credit to, or guarantee, acceptance, or letter of credit issued on behalf of, an affiliate by a member bank or its subsidiary shall be secured at the time of the transaction by collateral having a market value equal to— “(A) 100 per centum of the amount of such loan or extension of credit, guarantee, acceptance, or letter of credit, if the collateral is composed of— “(i) obligations of the United States or its agencies; “(ii) obligations fully guaranteed by the United States or its agencies as to principal and interest; “(iii) notes, drafts, bills of exchange or bankers’ acceptances that are eligible for rediscount or purchase by a Federal Reserve Bank; or “(iv) a segregated, earmarked deposit account with the member bank; “(B) 110 per centum of the amount of such loan or extension of credit, guarantee, acceptance, or letter of credit if the collateral is composed of obligations of any State or political subdivision of any State; “(C) 120 per centum of the amount of such loan or extension of credit, guarantee, acceptance, or letter of credit if the collateral is composed of other debt instruments, including receivables; or “(D) 130 per centum of the amount of such loan or extension of credit, guarantee, acceptance, or letter of credit if the collateral is composed of stock, leases, or other real or personal property. “(2) Any such collateral that is subsequently retired or amortized shall be replaced by additional eligible collateral where needed to keep the percentage of the collateral value relative to the amount of the outstanding loan or extension of credit, guarantee, acceptance, or letter of credit equal to the minimum percentage required at the inception of the transaction. “(3) A low-quality asset shall not be acceptable as collateral for a loan or extension of credit to, or guarantee, acceptance, or letter of credit issued on behalf of, an affiliate. “(4) The securities issued by an affiliate of the member bank shall not be acceptable as collateral for a loan or extension of credit to, or guarantee, acceptance, or letter of credit issued on behalf of, that affiliate or any other affiliate of the member bank. “(5) The collateral requirements of this paragraph shall not be applicable to an acceptance that is already fully secured either by attached documents or by other property having an ascertainable market value that is involved in the transaction. “(d) Exemptions.— The provisions of this section, except paragraph (a)(4), shall not be applicable to— “(1) any transaction, except for the purchase of a low-quality asset which is prohibited, with a bank— “(A) which controls 80 per centum or more of the voting shares of the member bank; “(B) in which the member bank controls 80 per centum or more of the voting shares; or “(C) in which 80 per centum or more of the voting shares are controlled by the company that controls 80 per centum or more of the voting shares of the member bank; “(2) making deposits in an affiliated bank or affiliated foreign bank in the ordinary course of correspondent business, subject to any restrictions that the Board may prescribe by regulation or order; “(3) giving immediate credit to an affiliate for uncollected items received in the ordinary course of business; “(4) making a loan or extension of credit to, or issuing a guarantee, acceptance, or letter of credit on behalf of, an affiliate that is fully secured by— “(A) obligations of the United States or its agencies; “(B) obligations fully guaranteed by the United States or its agencies as to principal and interest; or “(C) a segregated, earmarked deposit account with the member bank; “(5) purchasing securities issued by any company of the kinds described in section 4(c)(1) of the Bank Holding Company Act of 1956; 12 USC 1843. “(6) purchasing assets having a readily identifiable and publicly available market quotation and purchased at that market quotation or purchasing loans on a non-recourse basis from affiliated banks; and “(7) purchasing from an affiliate a loan or extension of credit that was originated by the member bank and sold to the affiliate subject to a repurchase agreement or with recourse. “(e) Rulemaking and Additional Exemptions.— “(1) The Board may issue such further regulations and orders, including definitions consistent with this section, as may be necessary to administer and carry out the purposes of this section and to prevent evasions thereof. “(2) The Board may, at its discretion, by regulation or order exempt transactions or relationships from the requirements of this section if it finds such exemptions to be in the public interest and consistent with the purposes of this section.”. (c) Section 23A of the Federal Reserve Act, as amended by this section, shall apply to any transaction entered into after the date of enactment of this Act, except for transactions which are the subject of a binding written contract or commitment entered into on or before July 28, 1982, and except that any renewal of a participation in a loan outstanding on July 28, 1982, to a company that becomes an affiliate as a result of the enactment of this Act, or any participation in a loan to such an affiliate emanating from the renewal of a binding written contract or commitment outstanding on July 28, 1982, shall not be subject to the collateral requirements of this Act. (d) Section 18(j) of the Federal Deposit Insurance Act (12 U.S.C. 1828(j)) is amended by striking out “, within the meaning of section 2 12 USC 221a. of the Banking Act of 1933, and”. (e) Section 22(h)(6)(C) of the Federal Reserve Act (12 U.S.C. 375b–(6)(C)) is repealed and subparagraphs (D) through (G) of such section are redesignated as subparagraphs (C) through (F), respectively. (f) Section 106(b)(2)(E) of the Bank Holding Company Amendments of 1970 (12 U.S.C. 1972(2)(E)) is amended by striking out “the same meaning given it in section 23A of the Federal Reserve Act” and inserting in lieu thereof “the meaning prescribed by the Board pursuant to section 22(h) of the Federal Reserve Act (12 U.S.C. 375b),”. (g) Section 10(d) of the Federal Deposit Insurance Act (12 U.S.C. 1820(d)) is amended by inserting “as in section 2(b) of the Banking Act of 1933 (12 U.S.C. 221a(b)) and” after “shall have the same meaning”.

5. 1982

   Garn-St Germain Depository Institutions Act of 1982

   Pub. L. 97–320 § 424(c) · 96 Stat. 1469

   1. Inserted · 12 U.S.C. § 1972(2)(F)(i)

      Pub. L. 97–320, § 424(c), (d)(11), inserted proviso giving agency discretionary authority to compromise, etc., any civil money penalty imposed under such authority

   2. Substituted · 12 U.S.C. § 1972(2)(F)(i)

      Pub. L. 97–320, § 424(c), (d)(11), substituted “may be assessed” for “shall be assessed”

   Source evidence

   Code amendment note
   Par. (2)(F)(i). Pub. L. 97–320, § 424(c), (d)(11), inserted proviso giving agency discretionary authority to compromise, etc., any civil money penalty imposed under such authority, and substituted “may be assessed” for “shall be assessed”.

   Enacted provision · exact public law section
   (c) Section 29(a) of the Federal Reserve Act (12 U.S.C. 504(a)); section 8(i)(2)(i) of the Federal Deposit Insurance Act (12 U.S.C. 1818(i)(2)(i)); and section 106(b)(2)(F)(i) of the Bank Holding Company Act Amendments of 1970 (12 U.S.C. 1972(2)(F)(i)) are amended by inserting before the period at the end of the first sentence thereof the following: “: Provided, That the agency having authority to impose a civil money penalty may, in its discretion, compromise, modify, or remit any civil money penalty which is subject to imposition or has been imposed under such authority”.

6. 1982

   Garn-St Germain Depository Institutions Act of 1982

   Pub. L. 97–320 § 424(e) · 96 Stat. 1469

   Substituted · 12 U.S.C. § 1972(2)(F)(iv)

   Pub. L. 97–320, § 424(e), substituted “twenty days from the service” for “ten days from the date”

   Source evidence

   Code amendment note
   Par. (2)(F)(iv). Pub. L. 97–320, § 424(e), substituted “twenty days from the service” for “ten days from the date”.

   Enacted provision · exact public law section
   (e) Sections 29(d) and 19(l)(4) of the Federal Reserve Act (12 U.S.C. 504(d) and 505(4)), 18(j)(3)(D) and 8(i)(2)(iv) of the Federal Deposit Insurance Act (12 U.S.C. 1828(j)(3)(D) and 1818(i)(2)(iv)), 407(k)(3)(D) of the National Housing Act (12 U.S.C. 1730(k)(3)(D)), 5(d)(8)(B)(iv) of the Home Owners’ Loan Act of 1933 (12 U.S.C. 1464(d)(8)(B)(iv)), 206(j)(2)(D) of the Federal Credit Union Act (12 U.S.C. 1786(j)(2)(D)), and 106(b)(2)(F)(iv) of the Bank Holding Company Act Amendments of 1970 (12 U.S.C. 1972(2)(F)(iv)) are amended by striking out “ten days from the date” in each section and inserting in lieu thereof “twenty days from the service”.

7. 1982

   Garn-St Germain Depository Institutions Act of 1982

   Pub. L. 97–320 § 428(b)(1) · 96 Stat. 1469

   Substituted · 12 U.S.C. § 1972(2)(G)(ii)

   Pub. L. 97–320, § 428(b)(1), substituted “(ii) The appropriate Federal banking agencies are authorized to issue rules and regulations, including definitions of terms, to require the reporting and public disclosure of information by any bank or executive officer or principal shareholder thereof concerning any extension of credit by a correspondent bank to the reporting bank’s executive officers or principal shareholders, or the related interests of such persons.” for “(ii) Each insured bank shall compile the reports filed pursuant to subparagraph (G)(i) and forward such compilation to the Comptroller of the Currency in the case of a national bank, the Board in the case of a State member bank, and the Federal Deposit Insurance Corporation in the case of an insured nonmember State bank.”

   Source evidence

   Code amendment note
   Par. (2)(G)(ii). Pub. L. 97–320, § 428(b)(1), substituted “(ii) The appropriate Federal banking agencies are authorized to issue rules and regulations, including definitions of terms, to require the reporting and public disclosure of information by any bank or executive officer or principal shareholder thereof concerning any extension of credit by a correspondent bank to the reporting bank’s executive officers or principal shareholders, or the related interests of such persons.” for “(ii) Each insured bank shall compile the reports filed pursuant to subparagraph (G)(i) and forward such compilation to the Comptroller of the Currency in the case of a national bank, the Board in the case of a State member bank, and the Federal Deposit Insurance Corporation in the case of an insured nonmember State bank.”

   Enacted provision · exact public law section
   (1) by striking out subparagraph (ii) and inserting in lieu thereof the following: “(ii) The appropriate Federal banking agencies are authorized to issue rules and regulations, including definitions of terms, to require the reporting and public disclosure of information by any bank or executive officer or principal shareholder thereof concerning any extension of credit by a correspondent bank to the reporting bank’s executive officers or principal shareholders, or the related interests of such persons.”; and

8. 1982

   Garn-St Germain Depository Institutions Act of 1982

   Pub. L. 97–320 § 428(b)(2) · 96 Stat. 1469

   Struck · 12 U.S.C. § 1972(2)(G)(iii)

   Pub. L. 97–320, § 428(b)(2), struck out cl. (iii) which required insured banks to include in their section 1817(k)(1) report a list of names of executive officers or stockholders of record owning, controlling, or having more than a 10 per centum voting control of any class of voting securities of the bank who file information required by subpar. (G)(i) and aggregate amount of extensions of credit by correspondent banks to such executive officers or stockholders of record, any company controlled by such persons, and any political or campaign committee the funds or services of which will benefit such persons, or which is controlled by such persons

   Source evidence

   Code amendment note
   Par. (2)(G)(iii). Pub. L. 97–320, § 428(b)(2), struck out cl. (iii) which required insured banks to include in their section 1817(k)(1) report a list of names of executive officers or stockholders of record owning, controlling, or having more than a 10 per centum voting control of any class of voting securities of the bank who file information required by subpar. (G)(i) and aggregate amount of extensions of credit by correspondent banks to such executive officers or stockholders of record, any company controlled by such persons, and any political or campaign committee the funds or services of which will benefit such persons, or which is controlled by such persons.

   Enacted provision · exact public law section
   (2) by striking out subparagraph (iii).

9. 1982

   Garn-St Germain Depository Institutions Act of 1982

   Pub. L. 97–320 § 428(c) · 96 Stat. 1469

   Added · 12 U.S.C. § 1972(2)(H)

   Pub. L. 97–320, § 428(c), added subpar. (H)

   Source evidence

   Code amendment note
   Par. (2)(H). Pub. L. 97–320, § 428(c), added subpar. (H).

   Enacted provision · exact public law section
   (c) Section 106(b)(2) of the Bank Holding Company Act Amendments of 1970 (12 U.S.C. 1972(2)) is amended by adding at the end thereof the following: “(H) For the purpose of this paragraph— “(i) the term ‘bank’ includes a mutual savings bank; “(ii) the term ‘related interests of such persons’ includes any company controlled by such executive officer, director, or person, or any political or campaign committee the funds or services of which will benefit such executive officer, director, or person or which is controlled by such executive officer, director, or person; and “(iii) the terms ‘control of a company’ and ‘company’ have the same meaning as under section 22(h) of the Federal Reserve Act (12 U.S.C. 375b).”.

10. 1989

    Financial Institutions Reform, Recovery, and Enforcement Act of 1989

    Pub. L. 101–73 § 907(i) · 103 Stat. 183

    Amended · 12 U.S.C. § 1972(2)(F)

    Pub. L. 101–73, § 907(i), amended subpar. (F) generally, revising and restating as cls. (i) to (ix) provisions of former cls. (i) to (vii)

    Source evidence

    Code amendment note
    Par. (2)(F). Pub. L. 101–73, § 907(i), amended subpar. (F) generally, revising and restating as cls. (i) to (ix) provisions of former cls. (i) to (vii).

    Enacted provision · exact public law section
    (i) Banks.— Section 106(b)(2)(F) of the Bank Holding Company Act Amendments of 1970 (12 U.S.C. 1972(2)(F)) is amended to read as allows: “(B) Civil money penalty.— “(i) First tier.— Any bank which, and any institution-affiliated party (within the meaning of section 3(u) of the Federal Deposit Insurance Act) with respect to such bank who, violates any provision of this paragraph shall forfeit and pay a civil penalty of not more than $5,000 for each day during which such violation continues. “(ii) Second tier.— Notwithstanding clause (i), any bank which, and any institution-affiliated party (within the meaning of section 3(u) of the Federal Deposit Insurance Act) with respect to such bank who— “(I) (aa) commits any violation described in clause (i); “(bb) recklessly engages in an unsafe or unsound practice in conducting the affairs of such bank; or “(cc) breaches any fiduciary duty; “(II) which violation, practice, or breach— “(aa) is part of a pattern of misconduct; “(bb) causes or is likely to cause more than a minimal loss to such bank; or “(cc) results in pecuniary gain or other benefit to such party, shall forfeit and pay a civil penalty of not more than $25,000 for each day during which such violation, practice, or breach continues. “(iii) Third tier.— Notwithstanding clauses (i) and (ii), any bank which, and any institution-affiliated party (within the meaning of section 3(u) of the Federal Deposit Insurance Act) with respect to such bank who— “(I) knowingly— “(aa) commits any violation described in clause (i); “(bb) engages in any unsafe or unsound practice in conducting the affairs of such bank; or “(cc) breaches any fiduciary duty; and “(II) knowingly or recklessly causes a substantial loss to such bank or a substantial pecuniary gain or other benefit to such party by reason of such violation, practice, or breach, shall forfeit and pay a civil penalty in an amount not to exceed the applicable maximum amount determined under clause (iv) for each day during which such violation, practice, or breach continues. “(iv) Maximum amounts of penalties for any violation described in clause (iii).— The maximum daily amount of any civil penalty which may be assessed pursuant to clause (iii) for any violation, practice, or breach described in such clause is— “(I) in the case of any person other than a bank, an amount to not exceed $1,000,000; and “(II) in the case of a bank, an amount not to exceed the lessor of— “(aa) $1,000,000; or “(bb) 1 percent of the total assets of such bank. “(v) Assessment; etc.— Any penalty imposed under clause (i), (ii), or (iii) may be assessed and collected— “(I) in the case of a national bank, by the Comptroller of the Currency; “(II) in the case of a State member bank, by the Board; and “(III) in the case of an insured nonmember State bank, by the Federal Deposit Insurance Corporation, in the manner provided in subparagraphs (E), (F), (G), and (I) of section 8(i)(2) of the Federal Deposit Insurance Act for penalties imposed (under such section) and any such assessment shall be subject to the provisions of such section. “(vi) Hearing.— The bank or other person against whom any penalty is assessed under this subparagraph shall be afforded an agency hearing if such bank or person submits a request for such hearing within 20 days after the issuance of the notice of assessment. Section 8(h) of the Federal Deposit Insurance Act shall apply to any proceeding under this subparagraph. “(vii) Disbursement.— All penalties collected under authority of this subsection shall be deposited into the Treasury. “(viii) Violate defined.— For purposes of this paragraph, the term ‘violate’ includes any action (alone or with another or others) for or toward causing, bringing about, participating in, counseling, or aiding or abetting a violation. “(ix) Regulations.— The Comptroller of the Currency, the Board, and the Federal Deposit Insurance Corporation shall prescribe regulations establishing such procedures as may be necessary to carry out this subparagraph.”.

11. 1989

    Financial Institutions Reform, Recovery, and Enforcement Act of 1989

    Pub. L. 101–73 § 905(h) · 103 Stat. 183

    Added · 12 U.S.C. § 1972(2)(I)

    Pub. L. 101–73, § 905(h), added subpar. (I)

    Source evidence

    Code amendment note
    Par. (2)(I). Pub. L. 101–73, § 905(h), added subpar. (I).

    Enacted provision · exact public law section
    (h) Banks.— Section 106(b)(2) of the Bank Holding Company Act Amendments of 1970 (12 U.S.C. 1972(2)) is amended by adding at the end the following new subparagraph: “(I) Notice Under This Section After Separation From Service.— The resignation, termination of employment or participation, or separation of an institution-affiliated party (within the meaning of section 3(u) of the Federal Deposit Insurance Act) with respect to such a bank (including a separation caused by the closing of such a bank) shall not affect the jurisdiction and authority of the appropriate Federal banking agency to issue any notice and proceed under this section against any such party, if such notice is served before the end of the 6-year period beginning on the date such party ceased to be such a party with respect to such bank (whether such date occurs before, on, or after the date of the enactment of this subparagraph).

12. 1991

    Federal Deposit Insurance Corporation Improvement Act of 1991

    Pub. L. 102–242 title III § 306(j) · 105 Stat. 2236

    Inserted · 12 U.S.C. § 1972(2)(H)(i)

    Pub. L. 102–242 inserted before semicolon at end “, a savings bank, and a savings association (as those terms are defined in section 1813 of this title)”

    Source evidence

    Code amendment note
    Par. (2)(H)(i). Pub. L. 102–242 inserted before semicolon at end “, a savings bank, and a savings association (as those terms are defined in section 1813 of this title)”.

    Enacted provision · exact public law section
    (j) Preventing Savings Associations From Making Preferential Extensions of Credit Through Correspondent Institutions.— Section 106(b)(2)(H)(i) of the Bank Holding Company Act Amendments of 1970 (12 U.S.C. 1972(2)(H)(i)) is amended by inserting “, a savings bank, and a savings association (as those terms are defined in section 3 of the Federal Deposit Insurance Act)” after “mutual savings bank”.

13. 1996

    Department of Commerce and Related Agencies Appropriations Act, 1997

    Pub. L. 104–208 div. A title II § 2216(a) · 110 Stat. 3009

    Inserted · 12 U.S.C. § 1972(1)

    Pub. L. 104–208, in concluding provisions, inserted “and the prohibitions of section 1843(f)(9) and 1843(h)(2) of this title” after “prohibition”

    Source evidence

    Code amendment note
    Par. (1). Pub. L. 104–208, in concluding provisions, inserted “and the prohibitions of section 1843(f)(9) and 1843(h)(2) of this title” after “prohibition”.

    Enacted provision · exact public law section
    (a) Federal Reserve Board Authority.— Section 106(b)(1) of the Bank Holding Company Act Amendments of 1970 (12 U.S.C. 1972(1)) is amended in the last sentence, by inserting “and the prohibitions of section 4(f)(9) and 4(h)(2) of the Bank Holding Company Act of 1956” after “prohibition”.

14. 2006

    Pub. L. 109–351 title VI § 601(b) · 120 Stat. 1966

    1. Redesignated · 12 U.S.C. § 1972(2)(G)(I)

       Pub. L. 109–351 redesignated subpars. (H) and (I) as (G) and (H), respectively

    2. Struck · 12 U.S.C. § 1972(2)(G)(I)

       Pub. L. 109–351 struck out former subpar. (G) which related to written reporting requirements relating to bank loans to executive officers or stockholders with power to vote more than 10 per centum of any class of voting securities of an insured bank

    Source evidence

    Code amendment note
    Par. (2)(G) to (I). Pub. L. 109–351 redesignated subpars. (H) and (I) as (G) and (H), respectively, and struck out former subpar. (G) which related to written reporting requirements relating to bank loans to executive officers or stockholders with power to vote more than 10 per centum of any class of voting securities of an insured bank.

    Enacted provision · exact public law section
    (b) Reporting Requirements Regarding Loans From Correspondent Banks to Executive Officers and Shareholders of Insured Banks.— Section 106(b)(2) of the Bank Holding Company Act Amendments of 1970 (12 U.S.C. 1972(2)) is amended— (1) by striking subparagraph (G); and (2) by redesignating subparagraphs (H) and (I) as subparagraphs (G) and (H), respectively.

15. 2010

    Enhancing Financial Institution Safety and Soundness Act of 2010

    Pub. L. 111–203 title III § 355 · 124 Stat. 1376

    Inserted · 12 U.S.C. § 1972(1)

    Pub. L. 111–203 inserted “issue such regulations as are necessary to carry out this section, and, in consultation with the Comptroller of the Currency and the Federal Deposit Insurance Company, may” after “The Board may” in concluding provisions

    Source evidence

    Code amendment note
    Par. (1). Pub. L. 111–203 inserted “issue such regulations as are necessary to carry out this section, and, in consultation with the Comptroller of the Currency and the Federal Deposit Insurance Company, may” after “The Board may” in concluding provisions.

    Enacted provision · exact public law section
    SEC. 355. BANK HOLDING COMPANY ACT AMENDMENTS OF 1970.   Section 106(b)(1) of the Bank Holding Company Act Amendments of 1970 (12 U.S.C. 1972(1)) is amended in the undesignated matter following subparagraph (E) by inserting “issue such regulations as are necessary to carry out this section, and, in consultation with the Comptroller of the Currency and the Federal Deposit Insurance Company, may” after “The Board may”.

    Effective date note
    Amendment by Pub. L. 111–203 effective on the transfer date, see section 351 of Pub. L. 111–203, set out as a note under section 906 of Title 2, The Congress.

19 of 19 references resolved to an enrolled provision