Inter-System transfer of funds and equities.

CFR · 2024-01-01 · US · Title 12

(a) Section 5.17(a)(6) of the Act authorizes the FCA to regulate the borrowing, repayment, and transfer of funds and equities between institutions of the System, including banks, associations, and service corporations chartered under the Act. This section sets forth the circumstances and procedures under which the FCA may direct such a transfer of funds and equities based on its determination with respect to the financial condition of one or more institutions of the System. For purposes of this section, the term “bond” refers to long-term notes, bonds, debentures, or other similar obligations, or short-term discount notes issued by one or more banks pursuant to section 4.2 of the Act. (b) The FCA may direct a transfer of funds or equities by one or more banks of the System to another bank of the System where it determines that: (1) The receiving institution will not be able to make payments of principal or interest on bonds for which it is primarily liable within the meaning of section 4.4(a) of the Act; or (2) The common or preferred stock, participation certificates, or allocated equities of the receiving institution have a book value less than their par or stated values; or (3) The total bonds outstanding for which the receiving institution is primarily liable exceed 20 times the combined capital and surplus accounts of the bank; or (4) Based on application to it of one or more of the following ratios, the receiving institution is not financially viable in that it will not

official document · source cfr-2024 · id 12:§ 611.1130