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S-97 Reg. 0INTERPRETATION OF LAW OR REGULATION (Copies to be sent to all Federal reserve banks) May 21, 1938. Mr. E. H. Gough, Deputy Comptroller of the Currency, Washington, D. C. Dear Mr. Gough: This refers to your letter of April 30, 1938, with regard to the applicability of section 22(g) of the Federal Reserve Act to a transaction involving an executive officer of a national bank. Your letter states that a national bank purchased from one of its affiliates a note of Mr. , who is personal secretary to an executive officer of the national bank, and that the note in question was made for the accommodation of the executive officer and was guaranteed by such officer. Section 1(c) of the Board's Regulation 0 defines the terms "loan", "loaning", "extension of credit", and "extend credit" to include the acquisition by discount, purchase, exchange , or otherwise of any note, draft, bill of exchange or other evidence of indebtedness upon which an executive officer may be liable as maker, drawer, indorser, guarantor, or surety. Since, as stated in your letter, the national bank purchased the note upon which one of its executive officers is liable as guarantor, it seems clear that the transaction falls within the provisions of section 22(g) and Regulation 0. The fact that the note in question was acquired by the bank from its affiliate does not affect this conclusion. Very truly yours, (Signed) L. P. Bethea L. P. Bethea, Assistant Secretary.
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