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Federal R eserve Bank OF DALLAS ROBERT AND D. M c T E E R , J R . p re s id e n t C H IE F E X E C U T IV E D ALLAS. TE X A S O F F IC E R April 23, 1993 Notice 93-47 TO: The Chief Executive Officer of each financial institution in the Eleventh Federal Reserve District SUBJECT Amendments to Regulation 0 (Loans to Executive Officers, Directors, and Principal Shareholders of Member Banks) DETAILS The Board of Governors of the Federal Reserve System has published amendments in slip-sheet form to Regulation 0, effective February 1993. The new slip sheet should be inserted in your Regulations binder. ENCLOSURE The new slip sheet is enclosed. MORE INFORMATION For more information, please contact Jane Anne Schmoker at (214) 922-5104. For additional copies of this B a n k ’s notice and the slip sheet, please con tact the Public Affairs Department at (214) 922-5254. Sincerely yours, For additional copies, bankers and others are encouraged to use one of the following toll-free numbers in contacting the Federal Reserve Bank of Dallas: Dallas Office (800) 333-4460; El Paso Branch Intrastate (800) 592-1631, Interstate (800) 351-1012; Houston Branch Intrastate (800) 392-4162, Interstate (800) 221-0363; San Antonio Branch Intrastate (800) 292-5810. This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) Board of Governors of the Federal Reserve System Amendments to Regulation O Loans to Executive Officers, Directors, and Principal Shareholders of Member Banks February 1993* 1. Effective December 17, 1992, section 215.2 (I) is am ended to read as follows: (I)(I) Principal shareholder means a per son (other than an insured bank) that directly or indirectly, or acting through or in concert with one or more persons, owns, controls, or has the power to vote more than 10 percent of any class of vot ing securities of a member bank or com pany. Shares owned or controlled by a member of an individual’s immediate family are considered to be held by the individual. (2) A principal shareholder of a mem ber bank includes— (i) a principal shareholder of a com pany of which the member bank is a subsidiary, and (ii) a principal shareholder of any other subsidiary of that company. (3) A principal shareholder of a mem ber bank does not include a company of which a member bank is a subsidiary. officers, diectors, principal sharehold ers, or employees of the bank; (B) does not involve more than the normal risk of repayment or present other unfavorable features; and (C) the bank follows credit under writing procedures that are not less stringent than those applicable to comparable transactions by the bank with persons who are not executive officers, directors, principal sharehold ers, or employees of the bank. 2. Section 22(h)(2) o f the Federal Reserve Act is corrected to read as follows: (2 ) A member bank may extend credit to its executive officers, directors, or principal shareholders, or to any related interest of such a person, only if the extension of cred it— (A ) is made on substantially the same terms, including interest rates and collat eral, as those prevailing at the time for comparable transactions by the bank with persons who are not executive *A complete Regulation O, as amended effective Decem ber 17, 1993, consists of— • • the regulation pam phlet dated July 1992 (see inside cover) and this slip sheet. 1
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