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§ 1828a. —  Prudential safeguards.



[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
  January 24, 2002 and December 19, 2002]
[CITE: 12USC1828a]

 
                       TITLE 12--BANKS AND BANKING
 
            CHAPTER 16--FEDERAL DEPOSIT INSURANCE CORPORATION
 
Sec. 1828a. Prudential safeguards


(a) Comptroller of the Currency

                           (1) In general

        The Comptroller of the Currency may, by regulation or order, 
    impose restrictions or requirements on relationships or transactions 
    between a national bank and a subsidiary of the national bank that 
    the Comptroller finds are--
            (A) consistent with the purposes of this Act, title LXII of 
        the Revised Statutes of the United States, and other Federal law 
        applicable to national banks; and
            (B) appropriate to avoid any significant risk to the safety 
        and soundness of insured depository institutions or any Federal 
        deposit insurance fund or other adverse effects, such as undue 
        concentration of resources, decreased or unfair competition, 
        conflicts of interests, or unsound banking practices.

                             (2) Review

        The Comptroller of the Currency shall regularly--
            (A) review all restrictions or requirements established 
        pursuant to paragraph (1) to determine whether there is a 
        continuing need for any such restriction or requirement to carry 
        out the purposes of the Act, including the avoidance of any 
        adverse effect referred to in paragraph (1)(B); and
            (B) modify or eliminate any such restriction or requirement 
        the Comptroller finds is no longer required for such purposes.

(b) Board of Governors of the Federal Reserve System

                           (1) In general

        The Board of Governors of the Federal Reserve System may, by 
    regulation or order, impose restrictions or requirements on 
    relationships or transactions--
            (A) between a depository institution subsidiary of a bank 
        holding company and any affiliate of such depository institution 
        (other than a subsidiary of such institution); or
            (B) between a State member bank and a subsidiary of such 
        bank;

    if the Board makes a finding described in paragraph (2) with respect 
    to such restriction or requirement.

                             (2) Finding

        The Board of Governors of the Federal Reserve System may 
    exercise authority under paragraph (1) if the Board finds that the 
    exercise of such authority is--
            (A) consistent with the purposes of this Act, the Bank 
        Holding Company Act of 1956 [12 U.S.C. 1841 et seq.], the 
        Federal Reserve Act [12 U.S.C. 221 et seq.], and other Federal 
        law applicable to depository institution subsidiaries of bank 
        holding companies or State member banks, as the case may be; and
            (B) appropriate to prevent an evasion of any provision of 
        law referred to in subparagraph (A) or to avoid any significant 
        risk to the safety and soundness of depository institutions or 
        any Federal deposit insurance fund or other adverse effects, 
        such as undue concentration of resources, decreased or unfair 
        competition, conflicts of interests, or unsound banking 
        practices.

                             (3) Review

        The Board of Governors of the Federal Reserve System shall 
    regularly--
            (A) review all restrictions or requirements established 
        pursuant to paragraph (1) or (4) to determine whether there is a 
        continuing need for any such restriction or requirement to carry 
        out the purposes of the Act, including the avoidance of any 
        adverse effect referred to in paragraph (2)(B) or (4)(B); and
            (B) modify or eliminate any such restriction or requirement 
        the Board finds is no longer required for such purposes.

                          (4) Foreign banks

        The Board may, by regulation or order, impose restrictions or 
    requirements on relationships or transactions between a branch, 
    agency, or commercial lending company of a foreign bank in the 
    United States and any affiliate in the United States of such foreign 
    bank that the Board finds are--
            (A) consistent with the purposes of this Act, the Bank 
        Holding Company Act of 1956, the Federal Reserve Act, and other 
        Federal law applicable to foreign banks and their affiliates in 
        the United States; and
            (B) appropriate to prevent an evasion of any provision of 
        law referred to in subparagraph (A) or to avoid any significant 
        risk to the safety and soundness of depository institutions or 
        any Federal deposit insurance fund or other adverse effects, 
        such as undue concentration of resources, decreased or unfair 
        competition, conflicts of interests, or unsound banking 
        practices.

(c) Federal Deposit Insurance Corporation

                           (1) In general

        The Federal Deposit Insurance Corporation may, by regulation or 
    order, impose restrictions or requirements on relationships or 
    transactions between a State nonmember bank (as defined in section 3 
    of the Federal Deposit Insurance Act [12 U.S.C. 1813]) and a 
    subsidiary of the State nonmember bank that the Corporation finds 
    are--
            (A) consistent with the purposes of this Act, the Federal 
        Deposit Insurance Act [12 U.S.C. 1811 et seq.], or other Federal 
        law applicable to State nonmember banks; and
            (B) appropriate to avoid any significant risk to the safety 
        and soundness of depository institutions or any Federal deposit 
        insurance fund or other adverse effects, such as undue 
        concentration of resources, decreased or unfair competition, 
        conflicts of interests, or unsound banking practices.

                             (2) Review

        The Federal Deposit Insurance Corporation shall regularly--
            (A) review all restrictions or requirements established 
        pursuant to paragraph (1) to determine whether there is a 
        continuing need for any such restriction or requirement to carry 
        out the purposes of the Act, including the avoidance of any 
        adverse effect referred to in paragraph (1)(B); and
            (B) modify or eliminate any such restriction or requirement 
        the Corporation finds is no longer required for such purposes.

(Pub. L. 106-102, title I, Sec. 114, Nov. 12, 1999, 113 Stat. 1369.)

                       References in Text

    This Act and the Act, referred to in text, probably are references 
to Pub. L. 106-102, Nov. 12, 1999, 113 Stat. 1338, known as the Gramm-
Leach-Bliley Act. For complete classification of this Act to the Code, 
see Short Title of 1999 Amendment note set out under section 1811 of 
this title and Tables.
    Title LXII of the Revised Statutes, referred to in subsec. 
(a)(1)(A), consists of R.S. Secs. 5133 to 5244, which are classified to 
sections 21, 22 to 24a, 25a, 26, 27, 29, 35 to 37, 39, 43, 52, 53, 55 to 
57, 59 to 62, 66, 71, 72 to 76, 81, 83 to 86, 90, 91, 93, 93a, 94, 141 
to 144, 161, 164, 181, 182, 192 to 194, 196, 215c, 481 to 485, 501, 541, 
548, and 582 of this title. See, also, sections 8, 333, 334, 475, 656, 
709, 1004, and 1005 of Title 18, Crimes and Criminal Procedure. For 
complete classification of R.S. Secs. 5133 to 5244 to the Code, see 
Tables.
    The Bank Holding Company Act of 1956, referred to in subsec. 
(b)(2)(A), (4)(A), is act May 9, 1956, ch. 240, 70 Stat. 133, as 
amended, which is classified principally to chapter 17 (Sec. 1841 et 
seq.) of this title. For complete classification of this Act to the 
Code, see Short Title note set out under section 1841 of this title and 
Tables.
    The Federal Reserve Act, referred to in subsec. (b)(2)(A), (4)(A), 
is act Dec. 23, 1913, ch. 6, 38 Stat. 251, as amended, which is 
classified principally to chapter 3 (Sec. 221 et seq.) of this title. 
For complete classification of this Act to the Code, see References in 
Text note set out under section 226 of this title and Tables.
    The Federal Deposit Insurance Act, referred to in subsec. (c)(1)(A), 
is act Sept. 21, 1950, ch. 967, Sec. 2, 64 Stat. 873, as amended, which 
is classified generally to this chapter. For complete classification of 
this Act to the Code, see Short Title note set out under section 1811 of 
this title and Tables.

                          Codification

    Section was enacted as part of the Gramm-Leach-Bliley Act, and not 
as part of the Federal Deposit Insurance Act which comprises this 
chapter.


                             Effective Date

    Section effective 120 days after Nov. 12, 1999, see section 161 of 
Pub. L. 106-102, set out as an Effective Date of 1999 Amendment note 
under section 24 of this title.

                  Section Referred to in Other Sections

    This section is referred to in section 3106 of this title.



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