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72d CONGRESS.

SESS. I.

CHS. 521, 522.

725

JULY 21, 22, 1932.

(b) Subdivision (1) of section 502 of such Act, as amended Direct loans.
(U. S. C., Sup. V, title 38, sec. 642 (1)), is amended by striking out creased.
41/2 per centum" and inserting in lieu thereof " 3Y2 per centum ".
af
(c) The amendments made by subsections (a) and (b) of this Prior loans not section shall not apply with respect to interest accrued prior to the fte
date of the enactment of this Act.
SEC. 3. Subdivision (m) of section 502 of such Act, as amended
(U. S. C., Sup. V, title 38, sec. 642 (m)), is hereby amended to
read as follows:
"(m) Loans made by the Administrator of Veterans' Affairs under Funds available for
this section may at his option be made out of the United States loV. 43, p. 128.
Government life insurance fund, or out of the Adjusted Service
Certificate Fund created under section 505. In case of loans made
out of the United States Government life insurance fund the fund
shall be entitled to receive interest at the rate of 4 2per centum per inpnte ation of
annum, compounded annually, but, in respect of interest on any
such loan accruing after this subdivision as amended takes effect,
the amount by which interest at such rate exceeds 31/2 per centum
per annum, compounded annually, shall be paid to the United States
Government life insurance fund out of the Adjusted Service
Certificate Fund ".
Approved, July 21, 1932.
[CHAPTER 522.]

AN ACT
July 22, 1932.

[H. R. 12280.]
[Public, No. 304.]

To create Federal Home Loan Banks, to provide for the supervision thereof, and
for other purposes.

Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled, That this Act may Federal Home Loan
Bank Act.
be cited as the " Federal Home Loan Bank Act."
Definitions.

DEFINITIONS

SEC. 2. As used in this Act(1) The term "board" means the Federal Home Loan Bank
Board.
(2) The term "Federal Home Loan Bank" means a bank established by the board under authority of this Act.
(3) The term " State " includes the District of Columbia, Puerto

Rico, the Virgin Islands of the United States, and the Territories
of Alaska and Hawaii.
(4) The term "member" (except when used in reference to a
member of the board) means any institution which has subscribed
for the stock of a Federal Home Loan Bank.

"Board."
ederal Home Lan
B

"state."
"Member,"
io

excep.

mortgage

(5) The term "home mortgage loan" means a loan made by a

"Home

(6) The term "home mortgage " means a first mortgage upon real

"Home mortgag."

member or a nonmember borrower upon the security of a home loan"
mortgage.
estate, in fee simple, or leasehold under a renewable lease for not
less than ninety-nine years, upon which there is located a dwelling
for not more than three families, and shall include, in addition to

first mortgages, such classes of first liens as are commonly given to
secure advances on real estate by institutions authorized under this
Act to become members, under the laws of the State in which the
real estate is located, together with the credit instruments, if any,
secured thereby.

726
"npaid

72d CONGRESS.

SESS. I.

CH. 522.

JULY 22,1932.

(7) The term " unpaid principal," when used in respect of a loan
secured by a home mortgage means the principal thereof less the
sum of (1) payments made on such principal, and (2) in cases where

principal."

shares or stock are pledged as security for the loan, the payments
,"Amortized"
"instalmnent" homeormortgage

loan.

made on such shares or stock plus earnings or dividends apportioned
or credited thereon.

(8) An "amortized" or " installment" home mortgage loan shall,
for the purposes of this Act, be a home mortgage loan to be repaid

or liquidated in not less than eight years by means of regular weekly,

"Nonmember

bor-

monthly, or quarterly payments made directly in reduction of the
debt or upon stock or shares pledged as collateral for the repayment
of such loan.
(9) The term "nonmember borrower" includes an institution

authorized to secure advances from a Federal Home Loan Bank
under the provisions of section 6 (e).
Federal Home Loan
Banks.

fDesignate
bank in each

FEDERAL HOME LOAN BANKS

mctber
SEC. 3. As soon as practicable the board shall divide the condistrict tinental United States, Puerto Rico, the Virgin Islands, and the

Territories of Alaska and Hawaii into not less than eight nor more
than twelve districts. Such districts shall be apportioned with due
regard to the convenience and customary course of business of the
institutions eligible to and likely to subscribe for stock of a Federal
Home Loan Bank to be formed under this Act, but no such district
shall contain a fractional part of any State. The districts thus
created may be readjusted and new districts may from time to time
be created by the board, not to exceed twelve in all. Such districts
shall be known as Federal Home Loan Bank districts and may be
designated by number. As soon as practicable the board shall establish, in each district, a Federal Home Loan Bank at such city as may
be designated by the board. Its title shall include the name of the
city at which it is established.

Member and nonmember borrowers.

ElIGIBILITY OF MEMIBERS AND NONIMEIBER BORROWERS

SEa. 4. (a) Any building and loan association, savings and loan
association, cooperative bank, homestead association, insurance company, or savings bank, shall be eligible to become a member of, or a
Conditions.
nonmember borrower of, a Federal Home Loan Bank if such institution (1) is duly organized under the laws of any State or of the
United States; (2) is subject to inspection and regulation under the
banking laws, or under similar laws, of the State or of the United
States; and (3) makes such home mortgage loans as, in the judgment of the board, are long-term loans (and in the case of a savings
bank, if, in the judgment of the board, its time deposits, as defined
in section 19 of the Federal Reserve Act, warrant its making such
Disquaifications.
loans). No institution shall be eligible to become a member of, or
a nonmember borrower of, a Federal Home Loan Bank if, in the
judgment of the board, its financial condition is such that advances
may not safely be made to such institution or the character of its
management or its home-financing policy is inconsistent with sound
and economical home financing, or with the purposes of this Act.
Membership and
(b) An institution eligible to become a member or a nonmember
rie restrictionsborrower under this section may become a member only of, or secure
Eligible institutions.

advances from, the Federal Home Loan Bank of the district in which

is located the institution's principal place of business, or of tle bank
of a district adjoining such district, if demanded by convenience and
then only with the approval of the board.

72d CONGRESS.

SESS. I.

CH. 522.

727

JULY 22,1932.

(c) Notwithstanding the provisions of clause (2) of subsection Building, etc., as(a) of this section requiring inspection and regulation under law gible
tate ifsubjecting
regulationelito
as a condition with respect to eligibility for memberhip, any building prescre i subpectiont.

and loan association which would be eligible to become a member of
a Federal Home Loan Bank except for the fact that it is not subject
to inspection and regulation under the banking laws or similar laws
of the State in which such association is organized shall, upon
subjecting itself to such inspection and regulation as the board shall
prescribe, be eligible to become a member.

(d) Any home owner who comes within the limits of this Act obmemoer moeay
obtain mortgage money
and who is unable to obtain mortgage money from any other source ifunableelsewhere.
may obtain same from any bank organized under this Act: Pro- Limitation.

vided, That this subsection shall not be effective when the Federal
Government has had its stock retired.
SEC. 5. No institution shall be admitted to or retained in member-

Home

mortgage

ship, or granted the privileges of nonmember borrowers, if the corm- Institution disqualibined total of the amounts paid to it for interest, commission, bonus, ome"onetchaxeeto
discount, premium, and other similar charges, less a proper deduction legal rate, etc.

for all dividends, refunds, and cash credits of all kinds, creates an
actual net cost to the home owner in excess of the maximum legal
rate of interest or, in case there is a lawful contract rate of interest

applicable to such transactions, in excess of such rate (regardless of
any exemption from usury laws), or, in case there is no legal rate of
interest or lawful contract rate of interest applicable to such
transactions, in excess of 8 per centum per annumi the State where
such property is located. This section applies only to home mortgage
loans made after the enactment of this Act.
CAPITAL OF FEDERAL HOME LOAN BANKS AND SUBSCRIPTIONS

Contract

interest

rate

Federal Home Loan
THERETO Banks.

SEC. 6. (a) As soon as practicable after the enactment of this Act

Minimum capital.

the board, with the approval of the Secretary of the Treasury,
shall determine the minimum capital of each Federal Home Loan
Bank which shall be not less than $5,000,000.

The board shall, as

Subscriptions.

soon as practicable thereafter, open books in each district established
under section 3 for subscription to the capital stock of the Federal
Home Loan Bank of the district.
(b) The capital stock of each Federal Home Loan Bank shall be

Sh "esofstock.

divided into shares of a par value of $100 each. The minimum
capital stock shall be issued at par. Stock issued thereafter shall be
issued at such price not less than par as may be fixed by the board.
(c) The original stock subscription for each institution eligible to

Originalnvestment.

become a member under section 4 shall be an amount equal to 1 per
centum of the aggregate of the unpaid principal of the subscriber's
home mortgage loans, but not less than $1,500. The board shall from
time to time adjust the amount of stock held by each member so that,

Adjustments

of

as nearly as possible such member shall at all times have invested
in the stock of the Federal Home Loan Bank at least an amount
calculated in the manner provided in the preceding sentence (but

not less than $1,500). If the board finds that the investment of any if stoc hld
member in stock is greater than that required under this section, ngsmaybereduced.

upon application of such member, the bank shall pay such member
for each share of stock in excess of the amount so required an
amount equal to the value of such stock, or, at the election of the bank,
the whole or any part of the payments which would be so made shall
be credited upon the indebtedness of the member to the bank. In Paymntforae
either such event, stock equal in value to the amount of the payment
or credit, or both, as the case may be, shall be surrendered and
canceled. No share of stock shall be surrendered and canceled if the

effect of such surrender and cancellation would be to violate the

Rcpio

d

728

72d CONGRESS.

SESS. I.

CH. 522.

JULY 22,1932.

provisions of section 10 (c) requiring the amount of stock held by
such member to equal at least one-twelfth of the outstanding
advances to such member.
stockshubspat
for
(d) Stock subscriptions other than by the United States shall be
ay
Installment P - paid for in cash, and shall be paid for at the time of application
therefor, or, at the election of the subscriber, in installments, but not
less than one-fourth of the total amount payable shall be paid at
the time of filing application, and a further sum of not less than
one-fourth of such total shall have been paid at the end of each
succeeding period of four months.
Istitetio
(e) If the law of the State under which an institution described
State
laws dono
not here
permit stock purchase.
in section 4 operates does not permit such institution to subscribe for
stock in the Federal Home Loan Bank but if such institution has
Admitted to barrow- the power to borrow money and give security therefor, the board
uingprivileges on specifed terms, etc.
may permit such institution to obtain advances on the same terms
and conditions and subject to the same limitations as members
(except that such institution shall not be required, during the period
during which advances may be made under this subsection, to subscribe for stock in the Federal Home Loan Bank or to deposit such
stock as collateral security as required in section 10), but such instiSecurityrequired.
tution shall be required to keep on deposit such security, in addition
to home mortgages, for such advances, as the board shall determine,
which shall equal in value 1 per centum of the aggregate unpaid
permissive only principal of such institution's home mortgage loans (but not less
pending State asutori- than $1,500).
No advance to any such institution shall be made
zation.
under authority of this subsection after the State in which the institution is organized enacts legislation authorizing such institution to
subscribe for Federal Home Loan Bank stock or after the expiration
quidation and ter- of the next regular session of the legislature of such State begun
minttion if authority after the enactment of this Act, whichever is earlier. If, at the end
withheld,
of such time, such institution is not authorized to subscribe for stock,
the bank shall proceed to liquidate the indebtedness of such instituLimitation on ad. tion to the bank and to terminate its relations with such institution.
vances.
No advance shall be made under authority of this subsection which
matures more than one year after the advance is made, but the bank
may renew any such advance for yearly periods, or less, thereafter.
The maturity of no advance authorized under this subsection shall
be later than the time of the enactment of legislation authorizing
such institution to become a member or the expiration of such sessiof
of the legislature of the State, whichever is earlier.
tiois of lSinri'lllm er
(f) Tile Secretary of the Treasury shall subscribe, on behalf of
italtohbetakteovertby
the United States, for such part of the mini.mum capital of each
ury.

Federal Home Loan Bank as is not subscribed for by members under

subsection (c) of this section within thirty days after books have
Shsurn
been opened for stock subscriptions as provided in subsection (a).
subjettocallbyboans. Payments for stock subscriptions by the Secretary of the Treasury
shall be subject to call in whole or in part by the board, with the
approval of the Secretary of the Treasury, at such time or times as
Recelpts to issue; may be deemed advisable. Each Federal-Home Loan Bank receiving
such payments shall issue receipts therefor to the Secretary of the
Treasury, and such receipts shall be evidence of the stock ownership
cm for stock pur- of the United States. The aggregate amount expended by the
chaelimited.
lRecoutruetion
Fi- Tnited States for the purchase of stock under this Act shall not
"amendment.Act'n
exceed $125,000,00.
The Reconstruction Finance Corporation Act,
Ante,P. 5.
approved January 22, 1932, is amended by adding at the end of
Neeessary funds for section 2 thereof the following new paragraph
pament to be fr'"Inorder to enable the Secretary of the Treasury to make paynihed by corporation. ments upon stock of Federal Home Loan Banks subscribed for by

him in accordance with the Federal Home Loan Bank Act, the sum

72d CONGRESS.

SESS. I.

CH. 522.

JULY 22, 1932.

729

of $125,000,000, or so much thereof as may be necessary for such
purpose, is hereby allocated and made available to the Secretary of
the Treasury out of the capital of the corporation and/or the proceeds
of notes, debentures, bonds, and other obligations issued by the
corporation.

For the purposes of this paragraph, the corporation iBon ds, et.,

shall issue such notes, bonds, debentures, and other obligations as
may be necessary."

to be

(g) After the amount of capital of a Federal Home Loan Bank CiSsttockheldb
paid in by members equals the amount paid in by the Secretary of To be retired when
the Treasury under subsection (f), such bank shall apply annually bers is at
mep.

to the payment and retirement of the shares of the capital stock held
by the United States, 50 per centum of all sums thereafter paid in as
capital until all such capital stock held by the United States is retired
at par. Stock held by the United States may at any time, in the tme ment
rt
discretion of the Federal Home Loan Bank, and with the approval mit.
of the board, be paid off at par and retired in whole or in part; and
the board may at any time require such stock to be paid off at par
and retired in whole or in part if in the opinion of the board the
Federal Home Loan Bank has resources available therefor: Provided, J^O
That accumulated dividends, as provided in subsection (k), have dends.

My

d

been paid.
(h)

Stock subscribed for otherwise than by the United States, and fei,Unauthoriazed
etc.

the right to the proceeds thereof, shall not be transferred or hypothecated except as hereinafter provided and the certificates therefor
shall so state.
(i) Any member may withdraw from membership in a Federal

Home Loan Bank six months after filing with the board written
notice of intention so to do, and the board may, after hearing, remove
any member from membership, or deprive any nonmemberborrower
of the privilege of obtaining further advances, if, in the opinion of
the board, such member or nonmember borrower has failed to comply
with any provision of this Act or the regulations of the board
made pursuant thereto or if, in the opinion of the board, such
member or nonmember borrower is insolvent.

In any such case,

(j) A Federal Home Loan Bank may, with the approval of the
board, permit the disposal of stock to another member, or to an
institution eligible to become a member, but only to enable such

Iundbtedess to

oU

ransrof stock.

an institution to become a member.

Dividens.

dividend distributions without preference, except that stock sub-

S

(k) All stock of any Federal Home Loan Bank shall share in

fr

mewhmehip

the indebtedness of such member or nonmember borrower to the
Federal Home Loan Bank shall be liquidated, and the capital stock
in the Federal Home Loan Bank owned by such member shall be
surrendered and canceled. Upon the liquidation of such indebtedness
such member or nonmember borrower shall be entitled to the return etc.b o
of its collateral, and, upon surrender and cancellation of such capital
stock, the member shall receive a sum equal to its cash paid sub- Ep .
scriptions for the capital stock surrendered, except that if at any time
the board finds that the paid-in capital of a Federal Home Loan
Bank is or is likely to be impaired as a result of losses in or depreciation of the assets held, the Federal Home Loan Bank shall on the
order of the board withhold from the amount to be paid in retirement
of the stock a pro rata share of the amount of such impairment as
determined by the board.

trans-

dbU

scribed for by the United States shall be entitled to dividends at ssto.chdbu
a rate of 2 per centum per annum cumulative from the date of
investment but in any case in which the rate of dividend is in excess

o

m

be

730

72d CONGRES

SESS.
S.I.

CH. 522.

JULY 22,1932.

of 2 per centum, the stock subscribed for by the United States shall
be entitled to dividends at a rate not in excess of that paid on
other stock.
MANAGEMENST OF BANKS
Management of
SEC. 7. (a) The management of each Federal Home Loan Bank
bTobevestedinboard shall be vested in a board of eleven directors, all of whom shall

be citizens of the United States and bona fide residents of the district
in which such bank is located.
Appointment of two
(b) Two of such directors shall be appointed by the board. The
Terms.
terms of such directors shall expire one year and two years,
respectively, from the end of the calendar year 1932, and their successors shall be appointed by the board for terms of three years.
Division of nine di(c) Nine of such directors, three of whom shall be known as
groups. into three class A directors, three of whom shall be known as class B directors,
uppoi'ntent, to be and three of whom shall be known as class C directors, shall be first
elected forthree years. appointed by the board, and shall serve until the end of the calendar year 1932. Their successors shall be elected as provided in
subsection (d), and of such successors first elected one of each such
class shall serve for one, two, and three years, respectively. Thereafter all such directors shall serve for three years. Directors of
classes A, B, and C, whether appointed or elected, shall be chosen
from among persons connected with the home-financing business.
be dividedmi
tree
(d) The board shall divide all the members of each Federal
groups.
Home Loan Bank into three groups which shall be designated as
ions groups A, B, and C, which groups shall represent, respectively, and
as fairly as may be, group A, the large, group B, the medium-sized,
etc

f diretors,

and group C, the small members, the size of such members to be
determined according to the aggregate unpaid principal of the
member's home mortgage loans. The board may revise the memberDirectors elected by ship of such groups from time to time. Of the directors elected as
hereinafter provided, each class A director shall be an officer or
director of a member in group A, each class B director shall be an
officer or director of a member in group B, and each class C director
iegnulations goSvern shall be an officer or director of a member in group C. Each nmember shall be entitled to nominate suitably qualified persons for elec-

elections.

tion as directors of the class corresponding to the group to which
such member belongs, and shall east one vote for each director in
its class. The directors of each class shall be nominated and elected
in accordance with such rules and regulations as may be prescribed
Fiingvaanes
Chairman and vice
hairan to be designated.

stock hlld is less tbn

$1,000,000.

Copensaton

and

by the board.

(e) Any director appointed or elected as provided in this section
to fill a vacancy shall hold office only until the expiration of the
termf of his predecessor.
f)

The board shall designate one of the directors of each bank

to be chairman, and one to be vice chairman, of the board of directors
of such bank.
(g) If at any time when nominations are required, members
shall hold less than $1,000,000 of the capital stock of the Federal

Home Loan Bank, the board shall appoint a director or directors
to fill the place or places for which such nominations are required.
A director so appointed shall serve until the expiration of the calendar year during which he takes office.
(h) Each bank may pay its directors reasonable compensation for
the time required of them, and their necessary expenses, in the performance of their duties, in accordance with the resolutions adopted
by such directors, subject to the approval of the board.

72d CONGRESS.

SESS. I.

CH. 522.

(i) Such board of directors shall administer the affairs of the bank
fairly and impartially and without discrimination in favor of or
against any member or nonmember borrower, and shall, subject to
the provisions hereof, extend to each institution authorized to secure
advances such advances as may be made safely and reasonably with
due regard for the claims and demands of other institutions, and
with due regard to the maintenance of adequate credit standing for
the Federal Home Loan Bank and its obligations.
EXAMINATIONS

AND

731

JULY 22,1932.

Administration.

STUDIES BY THE BOARD

SEC. 8. The board shall cause to be made from time to time exam- Examination and
inations of the laws of the various States of the United States and sdi by the b
the regulations and procedure thereunder governing conditions under
which institutions of the kinds which may become members or nonmember borrowers under this Act are permitted to be formed or
to do business, or relating to the conveying or recording of land
titles, or to homestead and other rights, or to the enforcement of
the rights of holders of mortgages on lands securing loans, or otherwise. If any such examination shall indicate, in the opinion of the Operatons restricted
board, that under the laws of any such State or the regulations or satisfactory.
procedure thereunder there would be inadequate protection to a
Federal Home Loan Bank in making or collecting advances under
this Act, the board may withhold or limit the operation of any Federal Home Loan Bank in such State until satisfactory conditions of
ofe
Estabishment
law, regulation, or procedure shall be established. In any State. amination
of borrowers
where State examination of members or nonmember borrowers is where State law inadequa
te.
deemed inadequate for the purposes of the Federal Home Loan
Banks, the board shall establish such examination, all or part of
the cost of which may be considered as part of the cost of making
advances in such State. The banks and/or the board may make Trends of values to
studies of trends of home and other property values, methods of bestudied.
appraisals, and other subjects such as they may deem useful for the
general guidance of their policies and operations and those of institutions authorized to secure advances.
ELIGIBILITY TO SECURE ADVANCES

Eligibility to secure
advances.

cat
°
SEC. 9. Any member or nonmember borrower of a Federal Home et rm of app s ion,
Loan Bank shall be entitled to apply in writing for advances. Such
application shall be in such form as shall be required by the Federal Home Loan Bank with the approval of the board. Such Fed- Discretlonarystion.
eral Home Loan Bank may at its discretion deny any such application or, subject to the approval of the board, may grant it on such
conditions as the Federal Home Loan Bank may prescribe.
ADVANCES TO MEMBERS

SEC. 10. (a) Each Federal Home Loan Bank is authorized to make
advances to members and nonmember borrowers, upon the security
of home mortgages, such advances to be made subject to such regulations, restrictions, and limitations as the board may prescribe. Any
such advance shall be subject to the following limitations as to
amount:
(1) If secured by a home mortgage given in respect of an amortized home mortgage loan which was for an original term of eight
years or more, or in cases where shares of stock, which are pledged
as security for such loan, mature in a period of eight years or more,

Advances to ra.
s to m
be

Authority

to

make,

mortgages conerred.
sibatto

sp c f

e ed

tiefed nbytmorgage.

732

72d CONGRESS.

SESS. I.

CH. 522.

JULY 22,1932.

the advance may be for an amount not in excess of 60 per centum
Maximum amount. of the unpaid principal of the home mortgage loan; in no case shall
the amount of the advance exceed 40 per centum of the value of the
real estate securing the home mortgage loan.
secured by home
mortgage given on any
othermortgageloan.

(2) If

secured by a home mortgage given in respect of any other

home mortgage loan, the advance shall not be for an amount in
excess of 50 per centum of the unpaid principal of the home mortgage
loan; in no case shall the amount of such advance exceed 30 per

Limitation.

centum of the value of the real estate securing the home mortgage
loan.
Acceptance as collat(b) No home mortgage shall be accepted as collateral security for
den in specified eases. an advance by a Federal Home Loan Bank if, at the time such
advance is made (1) the home mortgage loan secured by it has more
than fifteen years to run to maturity, or (2) the value of the real
estate with respect to which the home mortgage is given exceeds
$20,000, or (3) is past due more than six months when presented.
Value of real estate For the purposes of this subsection and subsection (a) the value of
considered as when real estate shall be as of the time the advance is made and shall be
loan made.
established by such certification by the borrowing institution, or such
Investigations.
other evidence, as the board may require. For the purposes of this
section, each Federal Home Loan Bank shall have power to make, or
to cause or require to be made, such appraisals and other investigaRestriction where tions as it may deem necessary. No home mortgage otherwise eligible
agent is personally to be accepted as collateral security for an advance by a Federal
iable.
Home Loan Bank shall be accepted if any director, officer, employee,
attorney, or agent of the Federal Home Loan Bank or of the borrowing institution is personally liable thereon, unless the board has
specifically approved by formal resolution such acceptance.
Advances made on
properly secured notes.

Stock of h
furt;her seu'rity

(c) Such advances shall be made upon the note or obligation of

the member or nonmember borrower secured as provided in this
section, bearing such rate of interest as the board may approve or
and the Federal Home Loan Bank shall have a lien upon
r adetermine,
s

and shall hold the stock of such member as further collateral security

for all indebtedness of the member to the Federal Home Loant Bank.
t n time shall the aggrega.te outstanding advances made by any
XAdvlmces not tio
exeed twelve times Federal Hlome Loan Bankl
to any member exceed twelve times the
amount of eaitaleld, amounts paid in by such member for outstanding capital stock held

by it, or made to a onmebe brrower
bexeedtl
twelve times the
value of the seeurity required to be deposited under section 6 (e).
(d) The institutiolL applying for an advance shall enter into a
Applicants r0euired
toenter into oblratior primary and unconditional obligation to pay off all advances, together
topay, etc.
with interest and any unpaid costs and expenses in connection therewith according to the terms under which they were made, in such
form as shall meet the requirements of the bank and the approval
of the board. The bank shall reserve the right to require at any time,
additional secity
seurty re-d.
re when deemed necessary for its protection, deposits of additional
additiond
served.
collateral security or substitutions of security by the borrowing
institution, and each borrowing institution shall assign additional or
Saleet. of advaaces substituted security when and as so required. Subject to the
to other Home Loan approval of the board. any Federal Home Loan Bank shall have
Banks.

power to sell to any other Federal Home Loan Bank, with or without
recourse, any advance made under the provisions of this Act, or to
allow to such bank a participation therein, and any other Federal
Home Loan Bank shall have power to purchase such advance or to
accept a participation therein, together with an appropriate assignment of security therefor.

72d CONGRESS.

SESS. I.

CH. 522.

733

JULY 22,1932.

GENERAL POWERS AND DUTIES OF BANKS

SEC. 11. (a) Each Federal Home Loan Bank shall have power,

subject to the approval of the board, (1) to borrow money, to give
security therefor, and to pay interest thereon, and (2) to issue
bonds and debentures having such maturities as may be determined
by the board, secured by the transfer of eligible obligations of borrowing institutions on advances made by the bank to borrowing
institutions and by the deposit of home mortgages.
(b) The board shall prescribe rules and regulations governing

the assignment, deposit, custody, substitution, and release of the
obligations of borrowing institutions to the bank which are transferred and of the home mortgages securing such bonds and debentures, the forms and terms of such bonds and debentures, and the
conditions under which they may be issued and retired, including
any option with respect to payment and retirement thereof in
advance of maturity, and such regulations shall provide for the
deposit in trust, under such terms and conditions as it may deem
advisable, of the home mortgages securing such bonds and debentures. For the purposes of this section the board is authorized to
appoint, and fix the compensation and prescribe the duties of, a
registrar in each district, who shall not be connected with or interested in any Federal Home Loan Bank, any member, any nonmem-

General powers and
duties.

Borrow money, etc.

To prescrib 6e

rla-

tiens governing obltgationsofborrowinginstitutions, etc.

ber borrower, or any institution of a class eligible to become a
member or a nonmember borrower under this Act, and to require pointed in ae dstricp
of such registrar a bond, in such amount and with such sureties as Surety requ"ed.

the board may fix, conditioned on the faithful performance of the
duties required of him.
(c) Such deposits in trust shall be so maintained that the aggre-

Isseo

bonds, etc.

gate unpaid principal of the home mortgage loans secured by the mortgs depositedas
home mortgages deposited as security for bonds or debentures shall, furity'eor,tmoustequ
as nearly as possible, be at all times not less than an amount equal
to 190 per centum of the total outstanding amount of such issue.
Cash deposited under authority of subsection (d) shall be security
for an amount of bonds and debentures equal to the amount of cash
deposited. Direct obligations of the United States deposited under
authority of subsection (d) shall be security for an amount of bonds
and debentures equal to the par value of such obligations.
Depsit of addition
(d) The board may at any time require any Federal Home Loan or sulbstiution as so

Bank to deposit additional home mortgages or to make substitutions curity
of home mortgages to secure such bonds and debentures, except that
when in the opinion of the board home mortgages are not available
for such purpose, it may permit, for such limited periods as it may
deem advisable, the deposit of cash or direct obligations of the

Cash eto.. In eu.

United States in lieu of the deposit of substitute or additional home

loan mortgages.
(e) The board shall approve or determine the rates of interest
to be paid by the Federal Home Loan Banks upon the notes, deben-

rates
notes, bonds, etc.
Limtati-n.

tures, or bonds which they may issue except that no bond or debenture issued within seven years after the enactment of this Act shall
bear a rate of interest in excess of 512 per centum per annum, and

no bond or debenture issued thereafter shall bear a rate of interest

M

in excess of 5 per centum per annum, and shall provide such margins peM'
(not to exceed 1/2 per centum) between interest rates received upon
advances made to borrowing institutions and interest paid upon obligations which the Federal Home Loan Bank may issue as will cover

to o

-

expenses of operation and reserves and, under such regulations as Retiet oFedermay be provided by the board, some part of such reserve may be asubscription.

devoted to retirement of the stock subscribed by the United States.

734

72d CONGRESS.

Joint,etc.,liabilityof
s
an .

Proziso.

peific accounts.

Mutual

arrange-

gations authorizned.i

Liabilitynotwaived.

Deposit restrictions.

bGener

Board to fix price of
t

ls
rateseand red
eoun

CH. 522.

JULY 22,1932.

(f) The Federal Home Loan Banks shall be jointly and severally
liable for the payment when due of all bonds and debentures, and
of notes and other obligations issued by any Federal Home Loan
Bank, and interest thereon, in accordance with their terms: Proided, That this shall not prevent any particular Federal Home Loan
Bank, when specifically so authorized by the board, from borrowing funds temporarily under the terms of obligations which shall
expressly state in substance in such manner as shall be approved by
the board that the liability therefor is confined to the issuing bank.
The Federal Home Loan Banks shall from time to time in accordance with rules, regulations, and orders of the board make adequate

agreements and arrangements among themselves for meeting the
payment of the bonds, debentures, notes, or other obligations on
which they are jointly and severally liable, and the interest thereon,
but such agreements and arrangements shall not restrict in any
respect the joint and several liability herein established.
(g)
Each Federal Home Loan Bank shall have power to accept
only such deposits as are made by members and nonmember borrowers of such bank, or by other Federal Home Loan Banks. Such
deposits shall not be subject to check, and no rate of interest in
excess of 2 per centum per annum shall be paid thereon. " Deposits "
as used in this section, does not include deposits made under section

fobanking 6 (e).

Rediscounts, etc.

SESS. I.

No Federal Home Loan Bank shall transact any banking

or other business not expressly authorized by this Act.
(h) The board is authorized and empowered to permit, or, whenever in the judgment of at least four members of the board an
emergency exists requiring such action, to require, Federal Home
Loan Banks to rediscount the discounted notes of members or nonmember borrowers held by other Federal Home Loan Banks, or to
purchase the bonds issued by any other Federal Home Loan Bank,
or to make deposits with other Federal Home Loan Banks. In any
case in which the board requires the purchase of bonds, the board

shall fix the price therefor, or if the board requires the acceptance
of a deposit, it shall fix the security therefor. The rediscount rates
and the rates of interest to be paid upon deposits shall be fixed by
the board.
Duties of bank.
To carry stum equal
to capital Useftitions, aetc, invtel ill
Deposit in banks,
ethort-termloans.

(i) Each Federal Home Loan Bank shall at all times have an
o
amount, equal to the sums paid in on outstanding capital subscriptions of its members, plus an amount, equal to tle current deposits
received froim its menmbers and from nonueirber borrowers, invested
in (1) obligations of the. United States, (2) deposits in banks or

trust companies, (8) advances with maturity not greater than one
year made to members or nonmember borrowers, upon such terms
and conditions as the board may prescribe, and (4) advances with
maturity not greater than one year made to members or nonmember
borrowers the amount of whose creditor liabilities (not including
advances from the Federal Home Loan Bank) does not exceed 5 per
Advances without centum of such member's or nonmember borrower's net assets, which
mortgage securit.
advances may be made without the security of home mortgages or

other security, upon such terms and conditions as the board may
prescribe.
Investent o desig-

(j) Such part of the assets of each Federal Home Loan Bank
(except reserves and except sums provided for in subsection (i)) as

such bank may deem available therefor, and as are not required for
advances to members or nonmember borrowers, may be invested,
subject to such regulations, restrictions, and limitations as may be
prescribed by the board, in direct obligations of the United States

72d CONGRESS.

SESS. I.

CH. 522.

735

JULY 22, 1932.

and in such securities as fiduciary and trust funds may be invested
in under the laws of the State in which the Federal Home Loan
Bank is located.
INCORPORATION OF BANKS, AND CORPORATE POWERS

SEC. 12. The directors of each Federal Home Loan Bank shall,
in accordance with such rules and regulations as the board may prescribe, make and file with the board at the earliest practicable date
after the establishment of such bank, an organization certificate
which shall contain such information as the board may require.
Upon the making and filing of such organization certificate with the
board, such bank shall become, as of the date of the execution of its
organization certificate, a body corporate, and as such and in its

name as designated by the board it shall have power to adopt, alter,
and use a corporate seal; to make contracts; to purchase or lease
and hold or dispose of such real estate as may be necessary or convenient for the transaction of its business, but no bank building
shall be bought or erected to house any such bank, nor shall any such
bank make any lease for such purpose which has a term of more
than ten years; to sue and be sued, to complain, and to defend, in
any court of competent jurisdiction, State or Federal; to select,
employ, and fix the compensation of such officers, employees, attorneys, and agents as shall be necessary for the transaction of its
business, subject to the approval of the board; to define their duties,
require bonds of them and fix the penalties thereof, and to dismiss
at pleasure such officers, employees, attorneys, and agents; and, by
its board of directors, to prescribe, amend, and repeal by-laws, rules,
and regulations governing the manner in which its affairs may be
administered; and the powers granted to it by law may be exercised
and enjoyed subject to the approval of the board. The president of

Ipoerp ofrn

an

Establishment,

d

on

tinfcate.

Authority,

duties,

Limitation on build-

Bank president may

a Federal Home Loan Bank may also be a member of the board ofso dito
directors thereof, but no other officer, employee, attorney, or agent No paid officer, etc.,
of such bank, who receives compensation, may be a member of the to be director.

board of directors. Each such bank shall have all such incidental
powers, not inconsistent with the provisions of this Act, as are customary and usual in corporations generally.
EXEMPTION

FROM TAXATION

SEC. 13. Any and all notes, debentures, bonds, or other such obli- Bank obligations to
gations issued by any bank shall be exempt both as to principal and beexempt from taxrs

interest from all taxation (except surtaxes, estate, inheritance, and
gift taxes) now or hereafter imposed by the United States, by any
Territory, dependency, or possession thereof, or by any State, county,
municipality, or local taxing authority. The bank, including its Designated resources
franchise, its capital, reserves, and surplus, its advances, and its ta
ances included.
income shall be exempt from all taxation now or hereafter imposed
by the United States, by any Territory, dependency, or possession
thereof, or by any State, county, municipality, or local taxing
authority; except that in any real property of the bank shall be Exception.
subject to State, Territorial, county, municipal, or local taxation to
the same extent according to its value as other real property is taxed.
The notes, debentures, and bonds issued by any bank, with unearned

coupons attached, shall be accepted at par by such bank in payment
of or as a credit against the obligation of any home-owner debtor

of such bank.

Acceptance of notes

., atpaif unearne
ou

at

736
Loan bankts
psitaies
of

72d CONGRESS.
hen so

public

Exepytion.
To act as financial
agents.

rbligations oBa

e-

SESS. I.

CH. 522.

JULY 22, 1932.

SEC. 14. When designated for that purpose by the Secretary of the
Treasury, each Federal Home Loan Bank shall be a depositary of
public money, except receipts from customs, under such regulations
as may be prescribed by said Secretary; and it may also be employed
as a financial agent of the Government; and it shall perform all such
reasonable duties as depositary of public money and financial agent
of the Government as may be required of it.
S E . 15. Obligations of the Federal Home Loan Banks issued with

the approval of the board under this Act shall be lawful investments,
of, as and may be accepted as security, for all fiduciary, trust, and public
securcptane
funds the investment or deposit of which shall be under the authority or control of the United States or any officer or officers thereof.
The Federal reserve banks are authorized to act as depositaries, custodians, and/or fiscal agents for Federal Home Loan Banks in the
To plainly state not general performance of their powers under this Act.
All obligations
Frederal obligations nor
guaranteed by United of Federal Home Loan Banks shall plainly state that such obligations
States.
are not obligations of the United States and are not guaranteed by the
United States.
RESERVES AND DIVIDENDS
Bank reserve.
Provisions for aceumulating, and mainte-

nance of.

Payment of
ends.

SEC. 16. Each Federal Home Loan Bank shall carry to a reserve
account semiannually 20 per centum of its net earnings until said
reserve account shall show a credit balance equal to 100 per centum
of the paid-in capital of such bank. After said reserve has reached
100 per centum of the paid-in capital of said bank, 5 per centum of
its net earnings shall be added thereto semiannually. Whenever said
reserve shall have been impaired below 100 per centum of the
paid-in capital it shall be restored before any dividends are paid.
Each Federal Home Loan Bank shall establish such additional
reserves and/or make such charge-offs on account of depreciation or
impairment of its assets as the board shall require from time to
divi- time. No dividends shall be paid except out of net earnings remaining after all reserves and charge-offs required under this Act have
been provided for, and then only with the approval of the board.
The reserves of each Federal Iome Loan Bank shall be invested,
subject to such regulations, restrictions, and limnitations as may
be prescribed by the board, in direct obligations of the United
States and in such securities as fiduciary and trust funds may be
invested in under the laws of the State in which the Federal Home
Loan Bank is located.

Federal Home Loan
Bank Board.

FEDERAL HOM1E LOAN BANK BOARD

SEC. 17. For the purposes of this Act there shall be a board, to be
known as the " Federal Home Loan Bank Board ", which shall contppointment osatnsist of five citizens of the United States appointed by the President
oiticalaftionet
of the United States, by and with the advice and consent of the
Senate. Not more than three members of the board shall be members

Composition.

of the same political party.

Tenrsofoffice.

Vaeancies.

Each member shall devote his entire time

to the business of the board. Before entering upon his duties each of
the members shall take an oath faithfully to discharge the duties of
his office. The President of the United States shall designate one of
the members of the board to serve for a term of two years, one for
three years, one for four years, one for five years, and one for six
years from the date of the enactment hereof, and thereafter the
term of each member shall be six years from the date of the expiration of the term for which his predecessor was appointed. Whenever
a vacancy shall occur among the members the person appointed

72d CONGRESS.

SESS. I.

CH. 522.

JULY 22,1932.

to fill such vacancy shall hold office for the unexpired portion of
the term of the member whose place he is selected to fill. Each
of the members of the board shall receive a salary at the rate of
$10,000 per annum: Provided, That during the fiscal year 1933
the salary shall be $9,000 per annum.

The President shall designate

one of the members as chairman of the board. The chairman shall
be the chief executive officer of the board and in his absence or
disability the duties of his office shall be performed by some one
of the other members to be designated as acting chairman by the
chairman in such order as he may determine. The board shall
supervise the Federal Home Loan Banks created by this Act, shall

737
Salary.
Proviso.
Salary, fiscal year
1933.
Chairman to be designated.

Authority,
board.

etc., of

perform the other duties specifically prescribed by this Act, and
shall have power to adopt, amend, and require the observance of
such rules, regulations, and orders as shall be necessary from time
to time for carrying out the purposes of the provisions of this Act.
The board shall have power to suspend or remove any director, officer

employee, or agent of any Federal Home Loan Bank, the cause of
such suspension or removal to be communicated in writing forthwith
to such director, officer, employee, or agent and to such Federal Home
Loan Bank.
ADMINISTRATIVE EXPENSES

Administrative
penses.

ex-

SEC. 18. (a) There is hereby authorized to be appropriated the saluriesandexpenesd.r
sum of not to exceed $300,000 for salaries, travel and subsistence
expenses, rents, printing and binding, furniture and equipment, law
books, books of reference, periodicals newspapers, maps, contract
stenographic reporting services, telephone and telegraph services,
and all other necessary expenses of the board, together with expenses
preliminary to the organization and establishment of the banks
created hereunder, until the end of the fiscal year 1933.
emianal
(b) The board shall have power to levy semiannually upon the ments to be levied
Federal Home Loan Banks, and they shall pay, on such equitable uponbanks.
basis as the board shall determine, an assessment sufficient in its
judgment to provide for the payment of its estimated expenses for
the half year succeeding the levying of each such assessment, begin- Available for pay
ning with the second half of the calendar year 1933. All expenses of mentof expenses.
the board incurred in carrying out the provisions of this Act, as
determined by it, beginning July 1, 1933 shall be paid from the
proceeds of such assessments, and if any deficiency shall occur in such Provison in event of

fund at any time between such semiannual assessments the board shall

have power to make an immediate assessment against the banks to
cover such deficiency on the same basis as the original assessment.
If any surplus shall remain from any assessment after the expiration
of the semiannual period for which it was levied, such surplus may
be deducted from the next following assessment.
SEC. 19. The board shall have power to select, employ, and fix
the compensation of such officers, employees, attorneys, and agents
as shall be necessary for the performance of its duties under this
Act without regard to the provisions of other laws applicable to the
employment or compensation of officers, employees, attorneys, and
agents of the United States. No such officer, employee, attorney, or
agent shall be paid compensation at a rate in excess of the rate provided in the case of members of the board. The board shall be entitled to the free use of the United States mails for its official business in the same manner as the executive departments of the Government; and shall determine its necessary expenditures under this
Act and the manner in which they shall be incurred, allowed, and
paid.
3051'--33---47

deficiency or surplus.

thorized

i

Paylimtaton.

kigpriileev.

a-

738

72d CONGRESS.

SESS. I.

CH. 522. JULY 22,1932.

EXAMINATIONS AND REPORTS

Examinations

and

reprts.

Annual report
subited

SEC. 20. The board shall from time to time, at least twice annually, require examinations and reports of condition of all Fed-

eral Home Loan Banks in such form as the board shall prescribe
and shall furnish periodically statements based upon the reports
to be of the banks to the board. The board shall annually make a full

Emners.

report of its operations to the Speaker of the House of Representatives, who shall cause the same to be printed for the information of

the Congress. For the purposes of this Act, examiners appointed
by the board shall be subject to the same requirements, responsibilities, and penalties as are applicable to examiners under the National Bank Act and the Federal Reserve Act, and shall have, in
the exercise of functions under this Act, the same powers and privileges as are vested in such examiners by law.

Unlawful acts and
penalties.
Willfully overvaluv
ing security.

Punishmentor

unismenor.

UNLAWFUL ACTS, AND PENALTIES

SEC. 21. (a) Whoever makes any statement, knowing it to be false,
or whoever willfully overvalues any security, for the purpose of
influencing in any way the action of a Federal Home Loan Bank or
the board upon any application, advance, discount, purchase, or
repurchase agreement, or loan, under this Act, or any extension
thereof by renewal, deferment, or action or otherwise, or the

acceptance, release, or substitution of security therefor, shall be
punished by a fine of not more than $5,000, or by imprisonment for
not more than two years, or both.

ounterfeitg,etc.

Embezzlement, etc.

(b) Whoever (1) falsely makes, forges, or counterfeits any note,
debenture, bond, or other obligation, or coupon, in imitation of or
purporting to be a note, debenture, bond, or other obligation, or
coupon, issued by a Federal Home Loan Bank; or (2) passes, utters,
or publishes, or attempts to pass, utter, or publish, any false, forged,
or counterfeited note, debenture, bond, or other obligation, or coupon,
purporting to have been issued by a Federal Home Loan Bank,
knowing the same to be false, forged, or counterfeited; or (3) falsely
alters any note, debenture, bond, or other obligation, or coupon,
issued or purporting to have been issued by a LFederal Home Loan
Bank, or (4) passes, utters, or publishes, or attempts to pass, utter,
or publish, as true any falsely altered or spurious note, debenture,
bond, or other obligation, or coupon, issued or purporting to have
been issued by a Federal Home Loan Bank, knowing the same to be
falsely altered or spurious, shall be punished by a fine of not more
than $10,000, or by imprisonment for not more than five years, or
both.
bo

(c) Whoever, being connected in any capacity with the board or
a Federal Home Loan Bank, (1) embezzles, abstracts, purloins, or
willfully misapplies any moneys, funds, securities, or other things of
value, whether belonging to it or pledged or otherwise intrusted to
it; or (2) with intent to defraud the board or any Federal Home
Loan Bank, or any other body politic or corporate, or any individual, or to deceive any officer, auditor, or examiners of the
board or a Federal Home Loan Bank, makes any false entry in any
book, report, or statement of or to the board or a Federal Home
Loan Bank, or, without being duly authorized, draws any order
or issues, puts forth, or assigns any note, debenture, bond, or other
obligation, or draft, mortgage, judgment, or decree thereof, shall be
punished by a fine of not more than $10,000, or by imprisonment
for not more than five years, or both.

72d CONGRESS.

SESS. I.

CH. 522.

JULY 22,1932.

739

(d) It shall be unlawful for any individual, partnership, asso- Unauthorized

use of

elation, or corporation (1) which is not a Federal Home Loan Bank
to use the words " Federal home loan bank," or a combination of the
word " Federal" with any of such words, as a name or a part of a
name under which he or it shall do business (except in the case of
a name under which business is being done at the time of the

me etc

enactment of this Act), or (2) which is not a Federal Home Loan

Misrepresentations.

Bank, to advertise or represent in any way that he or it is a Federal
Home Loan Bank, or to publish or display any sign, symbol, or
advertisement reasonably calculated to convey the impression that
he or it is a Federal Home Loan Bank, or (3) which is not a member, Falsely claiming
to advertise or represent in any way that he or it is a member, or members
to publish or display any sign, symbol, or advertisement reasonably
calculated to convey the impression that he or it is a member.
Violations of this section shall be punishable by a fine of not Punishment for.
exceeding $1,000 or by imprisonment of not exceeding one year,
or both.
(e) The provisions of sections 112, 113, 114, 115, 116, and 117 Contracts andagree
of the Criminal Code of the United States (U. S. C., title 18, secs. mesignated provi.
proiiDesignaldn
202 to 207, inclusive), in so far as applicable, are extended to apply sindepplrimiable.

to contracts or agreements of any Federal Home Loan Bank under
this Act, which, for the purposes hereof, shall be held to include

Vol. 35 pp. lo-110i.
U..
.. 475.

advances, loans, discounts, and purchase and repurchase agreements;
extensions and renewals thereof; and acceptances, releases, and substitutions of security therefor.
MISCEIL.T.AEOJU

Miscellaneous.

SEC. 22. (a) In order to enable the board to carry out the pro- nDesiatoele ton
visions of this Act, the Treasury Department, the Comptroller of fdence, needed data,

the Currency, the Federal Reserve Board, and the Federal reserve etc.
banks are hereby authorized, under such conditions as they may
prescribe, to make available to the board in confidence for its use
and the use of any Federal Home Loan Bank such reports, records,
or other information as may be available, relating to the condition
of institutions with respect to which any such Federal Home Loan
Bank has had or contemplates having transactions under this Act
or relating to persons whose obligations are offered to or held by any
Federal Home Loan Bank, and to make through their examiners or
other employees, for the confidential use of the board or any
Federal Home Loan Bank, examinations of such institutions.
(b) Every institution which shall apply for advances under this tconsent t e

.x

Act shall, as a condition precedent thereto, consent to such exami- cedentetc.

nation as the bank or the board may require for the purposes of this
Act and/or that reports of examinations by constituted authorities
may be furnished by such authorities to the bank or the board upon
request therefor.

of sock, etc.
SEO. 23. In order that the Federal Home Loan Banks may be tForms
to be prepared.

supplied with such forms of stock, debentures, and bonds as may
be necessary under this Act, the Secretary of the Treasury is authorized to prepare such forms thereof as shall be suitable and approved
by the board, which shall be held in the Treasury subject to delivery,
upon order of the board.

The engraved plates, dies, and bed pieces Custody

of

plates,

executed in connection therewith shall remain in the custody of the
Secretary of the Treasury.

The board shall reimburse the Secre-

Rimbursmentofex-

tary of the Treasury for any expense incurred in the preparation,
custody, and delivery of such stock, debentures, and bonds.

SEC. 24. (a) Any organization organized under the laws of any beilty fo

State and subject to inspection and regulation under the banking

mem

-

ft

740

72d CONGRESS.

SESS. I.

CH. 522.

JULY 22,1932.

or similar laws of such State shall be eligible to become a member
under this Act if(1) it is organized solely for the purpose of supplying credit
to its members;
(2) its membership (A) is confined exclusively to building
and loan associations, savings and loan associations, cooperative
banks, and homestead associations; or (B) is confined exclusively
to savings banks; and
(3) of the institutions to which its membership is confined
which are organized within the State, its membership includes a
majority of such institutions.
To become member

(b) In all respects, but subject to such additional rules and regu-

as the board may provide, any such organization shall be a
member for the purposes of this Act.
SEC. 25. Each Federal Home Loan Bank shall have succession
until dissolved by the board under this Act or by further Act of
qlations

Succession.
Liquidation, reganization', etc.l

Congress.

SEC. 26. Whenever the board finds that the efficient and economi-

cal accomplishment of the purposes of this Act will be aided by
such action, and in accordance with such rules, regulations, and
orders as the board may prescribe, any Federal Home Loan Bank
may be liquidated or reorganized, and its stock paid off and retired
in whole or in part in connection therewith after paying or making
provision for the payment of its liabilities. In the case of any
such liquidation or reorganization, any other Federal Home Loan
Bank may, with the approval of the board, acquire assets of any
such liquidated or reorganized bank and assume liabilities thereof,
tElgibilit of inSt

stoetiosk.

in whole or in part.
SEC. 27 Any institution, except a national bank, trust company, or

other banking organization organized under any law of the United
States, inclu(ing the laws relating to the District of Columbia,
shall be authorized to subscribe for stock of a Federal Home Loan
Bank if otherwise eligible to make such subscription under the
terms of this Act, any provision in any such law to the contrary

noita tlt affeet rtsinr
of

e

notwithstauding.
Sl Ix. 28. If any provision of this Act, or the application thereof

to any person or ciremnstanees, is held invalid, the remainder of

the Act, and the application of such provision to other persons or

Ou
tstanding,o
beisueanensuinSlthleo

ciretunstances. shall not be affected therebv.
St 2..
9. Th notw.ithstanding any provisions of law prohibiting

bonds of the United States from bearing the circulation privilege,
cent interest, orlessto for a period of three years from the date of enactment of this Act
iete.r
.mttion priv- all outstanding bonds of the United States heretofore issued or
.
1026, issued during such period, bearing interest at a rate not exceeding

wSe'iS.

Vol. 31, p. 49.
LTS. C., p. 267.

3% per centum per annum,
shall be receivable by
securityfheisa
o the Treasurer of
the United States as security for the issuance o circulating notes
to national banking associations, and upon the deposit with the
Treasurer of the United States by a national banking association
of any such bonds, such association shall be entitled to receive circulating notes in the same manner and to the same extent and subject
to the same conditions and limitations no provided by law in the
ase of 2 per centun grold b o n ds of the United States bearing the

tionsnot applcable.

circulation privilege; except that the limitation contained in sec-

voa1.voI.

tion 9 of the Act of July 12, 1882, as amended, with respect to the
amount of lawful money which may be deposited with the Treasurer
of the Lnited States by national banking associations for the pur-

bse asbyerysnational
banks
ane of cirlating
nTSbe delivered on
deposit of bonds.

p.ss1.
. s.C.,p.271.

pose of withdrawing bonds held as security for their circulating

notes, shall not apply to the bonds of the United States to which
the circulation privilege is extended by this section and which are

72d CONGRESS.

SESS. I.

CHS. 522-525.

741

JULY 22,1932.

held as security for such notes. Nothing contained in this section aisting laws not
shall be construed to modify, amend, or repeal any law relating to aec
bonds of the United States which now bear the circulation privilege.
As used in this section, the word " bonds " shall not include notes, Useofword "bonds."
certificates, or bills issued by the United States.
There are hereby authorized to be appropriated such sums as tioNeeoSsryadpropr
may be necessary to carry out the provisions of this section.
SEC. 30. The right to alter, amend, or repeal this Act is hereby Amendment.
expressly reserved.
Approved, July 22, 1932.
[CHAPTER 523.]

A

July 22,1932.

AN ACT

[H. R. 12768.1

Making an appropriation for the Federal Home Loan Bank Board for the fiscal
year ending June 30, 1933.

[Public, No. 30.]

Be it enacted by the Senate and House of Representatives of the BFedeard
l Ho
Loan
United States of America in Congress assembled, That for the pay- Appropriation for exment of all authorized expenses of the Federal Home Loan Bank pen ses, fsc year 933.
Board in carrying out the provisions of the Act of the Seventy- Ate, p. 72&

second Congress entitled "An Act to create Federal Home Loan
Banks, to provide for the supervision thereof, and for other purposes," there is hereby appropriated, out of any money in the
Treasury not otherwise appropriated, the sum of $250,000 for the
fiscal year ending June 30, 1933, to be available for the purposes
and subject to the conditions and limitations specified in such Act,
including personal services and rent in the District of Columbia
and elsewhere and expenses preliminary to the organization and
establishment of the banks created thereunder.
Approved, July 22, 1932.
[CHAPTER 524.]

July 22, 1932.
IS.461.]

AN ACT
To repeal an Act entitled "An Act to legalize the incorporation of National
Trades Unions," approved June 29, 1886.

[

Be it enacted by the Senate and House of Representatives of the un^nsaonl Trades
United States of America in Congress assembled, That the Act Act legalizing incorentitled "An Act to legalize the incorporation of National Trades PVon. 24, Pra

Unions," approved June 29, 1886, be, and the same hereby is, repealed.
Approved, July 22, 1932.
[CHAPTER 525.]
JOINT RESOLUTION
Making appropriations to enable the Federal Farm Board to distribute Government-owned wheat and cotton to the American National Red Cross and
other organizations for relief of distress.

, e

peaed.

July 22,1932.
[H. J. Res. 461.]

[Pub. Res., No. 43.]

Resolved by the Senate and House of Representatives of the United wovearndmcottown.
States of America in Congress assembled, That to enable the Federal penses
Appropriation
foreexecuting disFarm Board to carry into effect the provisions of the public resolution tribution, by American
entitled "Joint resolution authorizing the distribution of Govern- National ed Cros.

ment-owned wheat and cotton to the American National Red Cross
and other organizations for relief of distress," approved July 5, 1932,
not to exceed $40,000,000 is hereby appropriated, out of any money
in the Treasury not otherwise appropriated, to be used only for the

Apo,

p. 7W.

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