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§ 3901. —  Congressional declaration of policy.

[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
  January 24, 2002 and December 19, 2002]
[CITE: 12USC3901]

                       TITLE 12--BANKS AND BANKING
Sec. 3901. Congressional declaration of policy

    (a)(1) It is the policy of the Congress to assure that the economic 
health and stability of the United States and the other nations of the 
world shall not be adversely affected or threatened in the future by 
imprudent lending practices or inadequate supervision.
    (2) This shall be achieved by strengthening the bank regulatory 
framework to encourage prudent private decisionmaking and by enhancing 
international coordination among bank regulatory authorities.
    (b) The Federal banking agencies shall consult with the banking 
supervisory authorities of other countries to reach understandings aimed 
at achieving the adoption of effective and consistent supervisory 
policies and practices with respect to international lending.

(Pub. L. 98-181, title IX, Sec. 902, Nov. 30, 1983, 97 Stat. 1278.)

                      Short Title of 1989 Amendment

    Pub. L. 101-240, title IV, Sec. 401, Dec. 19, 1989, 103 Stat. 2501, 
provided that: ``This title [enacting section 3904a of this title and 
enacting provisions set out as notes under section 3904a of this title 
and section 2291 of Title 22, Foreign Relations and Intercourse] may be 
cited as the `Foreign Debt Reserving Act of 1989'.''

                               Short Title

    Section 901 of title IX of Pub. L. 98-181 provided that: ``This 
title [enacting this chapter] may be cited as the `International Lending 
Supervision Act of 1983'.''

   Encouragement of Debt-for-Development Swaps Through Local Currency 

    Pub. L. 101-240, title V, Sec. 531, Dec. 19, 1989, 103 Stat. 2513, 
provided that:
    ``(a) Statement of Policy.--It is the sense of the Congress that--
        ``(1) debt-for-development swaps, where payment is made in local 
    currency at the free market rate, serve a useful purpose by 
    providing banking institutions with constructive opportunities for 
    the reduction of the external debt of highly indebted developing 
    countries in a process that involves the participation of private, 
    nonprofit groups in providing a stimulus to the economic and social 
    development of such developing countries;
        ``(2) debt-for-development swaps provide highly indebted 
    developing countries with a creative method of reducing external 
    debt burdens, while promoting their economic growth and 
    restructuring objectives;
        ``(3) banking institutions should give careful consideration to 
    engaging in such swaps as one means of strengthening overall loan 
    portfolios through the reduction of high external debt burdens while 
    expanding economic opportunities through private sector initiatives; 
        ``(4) in order to avoid any bias against such swaps in the 
    regulatory framework applicable to the financial reporting of 
    banking institutions, where payment is made in local currency at the 
    free market rate, appropriate recognition of the fair market 
    exchange value of the currency so received should be made.
    ``(b) Notification Relating to Local Currency Repayment Through 
Debt-for-Development Swaps.--Before the end of the 6-month period 
beginning on the date of the enactment of this section [Dec. 19, 1989], 
each appropriate Federal banking agency shall adopt uniform guidelines 
that will effectuate the policy set forth in subsection (a) concerning 
the regulatory framework and accounting treatment of debt-for-
development swaps involving repayment in local currency at the free 
market rate. For the purpose of such guidelines, the impact of such 
swaps on reported loan loss reserves shall be determined by valuing 
currency received in such swaps at fair market exchange value.
    ``(c) Definitions.--As used in this section:
        ``(1) Appropriate federal banking agency.--The term `appropriate 
    Federal banking agency' has the meaning given such term in section 
    903(1) of the International Lending Supervision Act of 1983 [12 
    U.S.C. 3902(1)].
        ``(2) Banking institution.--The term `banking institution' has 
    the meaning given such term in section 903(2) of the International 
    Lending Supervision Act of 1983.
        ``(3) Debt-for-development swap.--The term `debt-for-development 
    swap' has the meaning given such term in section 1608(b)(2) of the 
    International Financial Institutions Act [22 U.S.C. 262p-4c(b)(2)].
        ``(4) Highly indebted country.--The term `highly indebted 
    country' means any country designated as a `Highly Indebted Country' 
    in the annual World Debt Tables most recently published by the 
    International Bank for Reconstruction and Development before the 
    date of the enactment of this section [Dec. 19, 1989].''