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§ 1831d. —  Statechartered insured depository institutions and insured branches of foreign banks.



[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
  January 24, 2002 and December 19, 2002]
[CITE: 12USC1831d]

 
                       TITLE 12--BANKS AND BANKING
 
            CHAPTER 16--FEDERAL DEPOSIT INSURANCE CORPORATION
 
Sec. 1831d. State-chartered insured depository institutions and 
        insured branches of foreign banks
        

(a) Interest rates

    In order to prevent discrimination against State-chartered insured 
depository institutions, including insured savings banks, or insured 
branches of foreign banks with respect to interest rates, if the 
applicable rate prescribed in this subsection exceeds the rate such 
State bank or insured branch of a foreign bank would be permitted to 
charge in the absence of this subsection, such State bank or such 
insured branch of a foreign bank may, notwithstanding any State 
constitution or statute which is hereby preempted for the purposes of 
this section, take, receive, reserve, and charge on any loan or discount 
made, or upon any note, bill of exchange, or other evidence of debt, 
interest at a rate of not more than 1 per centum in excess of the 
discount rate on ninety-day commercial paper in effect at the Federal 
Reserve bank in the Federal Reserve district where such State bank or 
such insured branch of a foreign bank is located or at the rate allowed 
by the laws of the State, territory, or district where the bank is 
located, whichever may be greater.

(b) Interest overcharge; forfeiture; interest payment recovery

    If the rate prescribed in subsection (a) of this section exceeds the 
rate such State bank or such insured branch of a foreign bank would be 
permitted to charge in the absence of this section, and such State fixed 
rate is thereby preempted by the rate described in subsection (a) of 
this section, the taking, receiving, reserving, or charging a greater 
rate of interest than is allowed by subsection (a) of this section, when 
knowingly done, shall be deemed a forfeiture of the entire interest 
which the note, bill, or other evidence of debt carries with it, or 
which has been agreed to be paid thereon. If such greater rate of 
interest has been paid, the person who paid it may recover in a civil 
action commenced in a court of appropriate jurisdiction not later than 
two years after the date of such payment, an amount equal to twice the 
amount of the interest paid from such State bank or such insured branch 
of a foreign bank taking, receiving, reserving, or charging such 
interest.

(Sept. 21, 1950, ch. 967, Sec. 2[27], as added Pub. L. 96-221, title V, 
Sec. 521, Mar. 31, 1980, 94 Stat. 164; amended Pub. L. 100-86, title I, 
Sec. 101(g)(2), Aug. 10, 1987, 101 Stat. 563; Pub. L. 101-73, title II, 
Sec. 201(a), Aug. 9, 1989, 103 Stat. 187.)


                            Prior Provisions

    Provisions similar to this section were contained in section 1831a 
of this title prior to its repeal by Pub. L. 96-221.


                               Amendments

    1989--Subsec. (a). Pub. L. 101-73 substituted ``insured depository 
institutions'' for ``insured banks''.
    1987--Subsec. (a). Pub. L. 100-86 struck out ``and insured mutual 
savings banks'' after ``insured savings banks''.


                             Effective Date

    Section applicable only with respect to loans made in any State 
during the period beginning on April 1, 1980, and ending on the date, on 
or after April 1, 1980, on which such State adopts a law or certifies 
that the voters of such State have voted in favor of any provision, 
constitutional or otherwise, which states explicitly and by its terms 
that such State does not want this section to apply with respect to 
loans made in such State, except that this section shall apply to a loan 
made on or after the date such law is adopted or such certification is 
made if such loan is made pursuant to a commitment to make such loan 
which was entered into on or after April 1, 1980, and prior to the date 
on which such law is adopted or such certification is made, see section 
525 of Pub. L. 96-221, set out as an Effective Date of 1980 Amendment 
note under section 1785 of this title.


               Choice of Highest Applicable Interest Rate

    In any case in which one or more provisions of, or amendments made 
by, title V of Pub. L. 96-221, section 1735f-7 of this title, or any 
other provisions of law, including section 85 of this title, apply with 
respect to the same loan, mortgage, credit sale, or advance, such loan, 
mortgage, credit sale, or advance may be made at the highest applicable 
rate, see section 528 of Pub. L. 96-221, set out as a note under section 
1735f-7a of this title.


                         Definition of ``State''

    For purposes of this section, the term ``State'' to include the 
several States, the Commonwealth of Puerto Rico, the District of 
Columbia, Guam, the Trust Territories of the Pacific Islands, the 
Northern Mariana Islands, and the Virgin Islands, see section 527 of 
Pub. L. 96-221, set out as a note under section 1735f-7a of this title.

                  Section Referred to in Other Sections

    This section is referred to in section 1831u of this title.



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