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FED ER A L RESERVE BANK
O F N E W YORK
Na 9 0 9 7 1
June 25, 1981
J
C Circular
INTERNATIONAL BANKING FACILITIES
Amendments to Regulations D and Q, Effective December 3, 1981
To A ll Deposit&ry Institutions, and Others Concerned,
in the Second Federal Reserve District:
Following is the text of a statement issued by the Board of Governors of the Federal Reserve
System:
The Federal Reserve Board has amended its regulations regarding reserve requirements and payment of
interest on deposits to permit the establishment of International Banking Facilities (IB Fs) in the United States.
The Board acted after consideration of comment received on its December proposal to revise its regula
tions to permit the establishment of IBFs.
IBFs may be established, subject to conditions specified by the Board, by United States depository insti
tutions, by Edge and Agreement Corporations and by United States branches and agencies of foreign banks.
In general, under the rules adopted by the Board, an IBF may accept deposits from and extend credit to
foreign residents or other IBFs. All such funds will be exempt from reserve requirements of Regulation D
and from interest rate limitations of Regulation Q. The Board believes that establishment of IBFs at U.S.
banking offices will enhance the international competitive position of banking institutions in the United States.
The Board made its action effective December 3, 1981, in order to give all interested banking institutions
time to make necessary arrangements for implementation of IBFs.
In amending its regulations respecting reserve requirements and interest rate ceilings to permit the
establishment of IBFs, the Board made a general statement of policy regarding the use of IBF deposits and
IBF loans.
The policy statement, which is contained in the attached notice to the Board’s action, said in part:
\ The Board expects that, with respect to nonbank customers located outside the United States,
1 IBFs will accept only deposits that support the customer’s operations outside the United States
and will extend credit only to finance the customer’s non-U.S. operations. Deposits should not
be used as a means of circumventing interest rate restrictions or reserve requirements.. . .
♦
*
*
Under the rules established by the Board, IBFs may, free of Federal reserve requirements or interest
rate limitations:
1. Offer to foreign nonbank residents time deposits with a minimum maturity, or required notice period
prior to withdrawal, of two business days. Such deposit accounts require minimum deposits and with
drawals of $100,000.
2. Offer time deposits to foreign offices of United States depository institutions or foreign banks, to other
IBFs or to the parent institution of an IBF with a minimum one day (overnight) maturity.
3. Extend credit to foreign residents (including banks), to other IBFs, or to the parent institution of
an IBF.
IBF loans and deposits, may be denominated either in United States dollars or in foreign currencies.
Advances by an IBF to United States offices of its parent institution will be subject to the reserve
requirement on Eurocurrency liabilities of the United States office in the same manner as advances from a
foreign office to its United States office.
IBFs will be subject to the same examination and supervisory procedures as apply to other operations of
its parent institution. The Board may require special reports from IBFs for monitoring monetary and credit
conditions and for other purposes.
Enclosed is a copy of the amendments to the Board’s Regulations D and Q, effective
December 3, 1981. Questions thereon should be directed to our Consumer Affairs and Bank
Regulations Department (Tel. No. 212-791-5914) or our Legal Department (Tel. No. 212-791-5031
or 212-791-5222). Questions concerning the filing of a notice of establishment of an IBF should be
directed to the Foreign Banking Applications Department (Tel. No. 212-791-5881).
A
n t h o n y
M.
S
o l o m o n
,
President.
TITLE
CHAPTER
SUBCHAPTER
A—
BOARD
12—
II—
OF
BANKS
AND
FEDERAL
GOVERNORS
RESERVE
OF
[Regulations
(Docket
PART
204—
RESERVE
217—
AGENCY:
Board
of
ACTION:
Final
rules.
SUMMARY:
ments
The
of
Interest
1981,
Board
on
the
("IBFs")
United
and
deposits
IBFs.
Such
to
from
offer
with
at
to
offer
or
the
from
foreign
will
own
only
IBF
the
the
DATE:
FURTHER
Paige
B.
Frankel,
the
[Enc.
to
extend
be
that
Cir.
United
large
other
the
to
the
to
beginning
Board,
banks)
or
Q.
IBFs
denomination
IBFs
prior
will
offices
IBF.
foreign
Funds
foreign
IBF.
in
from
other
Regulation
will
time
be
deposits
withdrawal
be
permitted
U.
S.
depository
central
banks,
by
an
residents,
to
other
Eurocurrency
IBFs
derived
reserve
at
position
U.
of
3,
by
IBF
an
IBFs,
institution
requirements.
S.
banking
banking
offices
institutions
1981.
CONTACT:
Paul
S.
Attorney
Economist
Division
Reserve
of
Gilbert
Pilecki,
T.
(202/452-3265),
(202/452-3578),
International
System,
Schwartz,
Senior
Washington,
Legal
or
C.
J.
Board
20551.
General
(202/452-3281),
Division;
Sydney
Finance,
D.
Associate
Attorney
D
permitted
raised
Funds
of
of
Agreement
IBF m a y
of
to
3,
banking
and
an
Require
Q—
December
located
requirements
IBFs,
competitive
Edge
banks
the
period
foreign
Reserve
States.
December
9097]
foreign
by
D—
Regulation
international
(including
establishment
international
Senior
No.
subject
the
of
addition,
credit
establishing
would
Winebarger,
Federal
to
and
institutions,
notice
to
establishing
INFORMATION
(202/452-3522),
of
In
banks,
(202/452-3625),
or
days.
204)
Regulation
residents
required
Regulation
reserve
of
System.
authorize
adopted
from
deposits
foreign
believes
in
Counsel
time
institution
EFFECTIVE
FOR
or
enhance
located
business
institution
Board
or
Reserve
of
residents
exempt
nonbank
maturity
two
used
its
foreign
rules
INSTITUTIONS
Facilities
Part
to
agencies
limitations
overnight
be
The
from
the
SYSTEM
DEPOSITS
States
depository
and
rate
the
to
Under
217)
interest
to
could
S.
RESERVE
Q]
amended
United
be
least
to
U.
Part
the
will
institutions
or
by
in
FEDERAL
DEPOSITORY
ON
(12 C F R
funds
a minimum
of
(12 C F R
OF
Federal
has
SYSTEM
R-0214)
Banking
the
Governors
branches
States.
accept
of
Institutions
Deposits
facilities
and
of
establishment
Corporations,
the
Governors
Depository
No.
and
INTEREST
International
THE
D
REQUIREMENTS
PART
BANKING
Key,
of
or
Allen
Economist
Governors
2
SUPPLEMENTARY
public
Reserve
(45
Q—
(w I B F s " ) b y
banking
and
foreign
rate
banks
be
and
only
to
to
its
16,
would
period
1981.
be
for
institutions
and
favor
concept
of
technical
they
would
changes
would
as
the
operate.
the
and
of
Policy
Board
Edge
and
located
outside
support
extend
Agreement
banks.
the
only
should
restrictions
1/
tions
and
total
worldwide
sured
and
Federal
Q
uninsured
and
state
a
on
the
of
of
as
bank
requirements.
IBFs
general,
on
primarily
commentators
a
number
indicated
that
in
conjunction
comments
under
number
with
which
received
other
IBFs
from
the
certain
modifications,
of
will
1981.
of
of
U.
will
of
S.
the
branches
to
only
United
non-U.
to
and
U.
U.
Edge
S.
and
customers
that
will
branches
Agreement
parent
foreign
assets
in
excess
of
$1
rate
depository
of
state
and
interest
S.
offices
uninsured
agencies
operations.
circumventing
to
and
nonbank
deposits
States
S.
enhance
institutions
respect
accept
applicable
banks,
IBFs
depository
with
customer's
branches,
ended
suggested
with
Corporations
S.
to
IBFs
outside
to member
or
institution
many
authorization
a means
interest
be
IBFs,
an
proposal
environment
3,
funds
from
could
respondents,
In
only
the
and
IBF
by
of
foreign
Such
D
reserve
IBF
79
However,
offices
the
from
IBFs.
obtained
from
proposal
expects
Agreement
agencies.
other
institutions,
agencies
deposits
Eurocurrency
requirements
Federal
international
other
proposal
S.
and
Regulation
significant
States,
consolidated
promote
to
IBFs.
that
U.
or
Funds
that,
following
facilitate
facilities
residents,
and
applies
the
D—
and
would
an
December
U.
used
204)
banking
depository
time
associations.
operations
be
or
to
the
finance
that
by
Corporations,
reserve
Edge
Regulation
to
not
or
institutions,
to
requested
Regulation
Part
raised
Board
United
customer's
credit
Deposits
The
the
Funds
Activities
believes
to
S.
of
competitive
effective
CFR
branches
banks
IBF.
the
and
of
U.
S.
comment
and
adopted
position
all
received
of
of
Part
Board
amend
international
accept
consideration
Regarding
competitive
foreign
has
below,
The
the
After
Board
indicated
General
adoption
regulatory
of
U.
foreign
trade
modifications,
favor
in
public,
the
to
the
were
banking
at
Q,—
public
Comments
of
217)
and
subject
were
in
(12, C F R
foreign
to
to
(12
institutions
IBFs
Regulation
credit
the
Institutions
requirements
establishing
IBF
The
March
of
from
1980,
proposal
States.
permitted
reserve
16,
a
States
other
United
borrow
extend
own
and
be
on
Deposits
United
proposal,
from
institution
from
on
the
Corporations,
would
exempt
December
84070)
Depository
the
the
limitations
used
the
in
Agreement
residents
would
in
depository
activity
Under
Edge
of
Interest
establishment
On
Fed. Reg.
Requirements
Regulation
the
INFORMATION:
comment
and
Corpora
banks
having
billion:
branches,
and
in
3
agencies
of
in w r i t i n g
account
foreign
to
an
of
receipt
such
of
U.
The
S.
It
is
foreign
by
be
The
or
loan
of
U.
by
opening
to
a
be
loan
to
communicated
or
Furthermore,
deposit
nonbank
acknowledge
line
by
of
foreign
in
writing
non-U.
of
only
operations
located
credit
to
its
S.
finance
foreign
model
nonbank
credit
the
the
non-U.
affiliates)
such
to
advise
could
by
may
the
be
depositor
United
S.
States
only
its
and
facilities
of
outside
by
deposits
used
operations
used
Federal
(or
banking
located
be
of
customers,
IBFs
a
the
to
U.
S.
obtain
notice
upon
the
opening
of
customers
that
are
foreign
affiliates
relationship may
or
a
international
statement
of
nonbank
of
outside
by
IBFs
policy:
Governors
facilities
(A l o a n
of
Board
used
Board's
banking
from
residents.
the
be
the
international
receipt
relationship
of
of
to
(or
of
could
respect
granting
a
be
established
loan
other
a
deposit
either
than
under
a
credit.)
______________, a
of
the
that
Federal
ternational
the
non-U.
S.
by
foreign
the
IBF
that
the
non-U.
affiliates)
solely
or
to
that
Establishing
an
An
finance
of
its
institution
for
primarily
of
its
its
foreign
that
(or
funds
used
of
the
it
solely
its
borrowings
operations
of
to
its
and
af
extensions
be
used
(or
S.
with
support
foreign
in
foreign
deposits
in
by
customer
U.
S.,
support
that
may
a
U.
Governors
received
facilities
outside
the
of
only
States
operations
that
be
used
depositor
United
located
or
be
banking
S.
outside
Board
deposits
may
a
the
of
its
affiliates,
and
used
from
the
IBF
will
outside
the
United
be
States,
affiliates.
IBF
structure
operated
operations,
proceeds
that
the
o f ______________ w i l l
S.
of
of
_____________ a c k n o w l e d g e s
non-U.
located
policy
System
outside
the
entity
facilities
international
finance
its
the
operations
of
to
is
Reserve
banking
located
credit
nonbank
it
filiates)
only
be
time
required
customers
that,
affiliates)
understands
zational
required
the
with
following
acknowledgment
of
be
statement
policy
the
used
an
a
will
loan
extensions
customer
line
the
support
may
is
at
established.
model
and
System
received
S.
first
residents
deposit
that
policy
customer
notice.
Reserve
to
is
following
nonbank
This
nonbank
relationship
affiliates
their
banks.
IBF
is
an
as
not
IBF.
a
required
it
is
to
establish
contemplated
recordkeeping
entity
a
separate
that
an
IBF
similar
to
an
organi
would
offshore
shell
branch.
entity
that
Deposits
and
initially
that
by
IBF.-'
for
its
IBF
assets
any
other
in
IBF.
to
notify
An
to
the
by
types
or
of
Permissible
to
from
of
at
from
general
rules,
Q
but
other
of
of
IBF
rate
limitations
For
assets
an
IBF
is
Board's
However,
not
an
IBF
such
any
or
an
IBFs.
of
IBF
least
by
IBF
business.
to
establish
its
IBF m a y
be
be
14
it
the
required
days
intends
conditions
Application
an
IBF.
established
primary
on
to m a i n t a i n
will
which
abide
to
may
restrictions
authority
restrictions
by
rate
at
an
IBFs
requirements
during
its
with
Failure
business
an
to
accounts
report
comply
district
required
to
which
matter,
in
is
to
IBF
also
and
U.
How
by
supervisor
its
concerning
engaged.
from
will
be
to
the
IBF
subject
from
the
such
IBFs
to
required
to
any
other
Federal
to
within
to
such
be
to
and
its
made
notice
funds
or
be
foreign
in
States
the
instruments.
Reserve
interest
requirements.
establishment
four-week
and
under
amounts
non-United
may
notice
acknowledgment
subsequent
shorter
in
obtain
similar
with
deposits
subject
deposits
be
reserve
such
customers
obtain
provide
upon
time
deposits
Federal
prior
IBF
provide
or
or
to
accept
institutions
States
time
to
will
permitting
of
permitted
United
institution
required)
be
depository
exempt
to
below,
types
withdrawals
placements,
be
permitted
deposits
detail
other
will
S.
be
Such
and
institution.
an
will
greater
deposits
other
concerning
(if
IBF
applicable
not
by
an
residents.
transferred
custcmer.
in
will
required
policy
acknowledgment
and
held
are
not
and
be
first
established
establish
agree
may
the
has
interest
period
to
conducting
borrowings,
liabilities
that
to
same
deposits,
IBF
its
in
authority,
An
of
IBFs,
the
form
an
to
subject
requiring
offices
Such
2/
than
$100,000.
from
desires
and
for
reserve
the
under
assets
located,
institution's
Bank
is
discussed
least
banks,
for
States
foreign
operations
the
of
to
liabilities
and
during
Board,
type
and
Q
segregated
is
Board
the
imposition
deposits
of
These
IBF
the
the
on
computation
Board
is
by
and
institution
the
Other
established
assets
only
reporting
Deposits
maturities
Regulation
the
basis
each
Accounts,
be
D
to m a i n t a i n
which
by
IBFs.
the
required
that
Board
the
non-United
special
minimum
a
in
deposits
licensing
IBF
as
Reserve
IBF
the
by
after
for
IBF m a y
existing
to
required
IBF's
activities
As
only
is
reserve
institution
chartering
the
first
accepting
an
in
An
reserve-free
revocation
Federal
approval
ever,
a
IBF
Regulations
applicable
periods
institution
the
established
or
or
in
one
Transaction
segregating
restrictions
the
of
2900).
established
result
Q,
FR
office
Board's
could
Regulation
to
the
subjecting
begin
on
liabilities
the
an
to
IBF
within
of
prior
provisions
requirements
engage
and
establish
Report
definitions
institution
and
with
(Form
computation
IBFs
IBF,
the
the
An
comply
the
to
may
separate
identifying
reserve
the
a
Cash
under
regulatory
transferred
four
institution
Vault
qualify
other
An
submits
of
the
thereof.
obtain
extension
of
period,
of
such
credit
Restrictions
only
States
be
on
that
IBF
will
be
Maturity
of
from
office
IBF
institution,
from
from
the
be
on
prior
be
to
foreign
not
on
be
deposits
may
be
overnight
be
the
may
be
Edge
of
prior
the
to
or
of
provide
for
business
In
a
the
of
from
depository
other
well
depository
foreign
notice
withdrawal
maturity
such
maturity
period
may
thereafter,
addition,
funds
S.
obligations
nonbank
Fixed
fixed
U.
as
required
day
deposit.
both
of
Notice
of
such
or
IBFs
obtain
Corporation,
deposits
renewable.
to
institutions,
maturity
will
insure
deposit,
another
operations
days.
help
residents,
of
United
IBF
instruments.
of
of
above,
of
the
to
permitted
maturity
any
date
be
States
Agreement
time
business
States
bearer
official
The
IBF
automatically
established
will
a minimum
deposit
to
or
domestic
IBF.
to
two
or
order
certificates
United
and
and
basis.
of
IBF
discussed
affiliates
operating
In
non-United
the
banks
the
subject
date
given
or
branches
establishing
will
An
As
foreign
IBFs.
negotiable
outside
bank,
to
in
negotiable
deposits.
central
withdrawal
given
may
other
deposits.
institution
deposits
issuing
or
IBF
including
the
restricted
located
foreign
an
residents
time
of
and
time
from
foreign
institution
may
are
acceptances,
any
IBFs,
to m a i n t a i n
deposits
holders
residents,
other
prohibited
bankers'
IBFs,
States
entities,
eligible
as
eligible
non-United
but
IBF
time
accounts
and
a
notice
period.
An
since
such
an
size
established
business
IBF
that
the
some
at
to
the
same
of
average
of
of
out
amount.
accounts
an
IBF
and
than
will
enable
the
customers
of
any
deposit
on
whether
authorize
be
daily
require
of
to
a minimum
$100,000
for
from
public
the
could
in
and
that
an
al
daily
deposit
the
ability
banking
the
requirement
operationally
burdensome.
the
average
The
IBF
of
subject
has
time
of
determined
deposits
of
balance
is
if
transaction
Board
institutions
nature
Board
from
average
or
indicated
restrict
international
permitted
account.
be
amount
be
banking
comment
received,
not
should
As
engage
wholesale
will
IBFs
$500,000.
withdrawals
more
that
be
amount
is
requirements.
international
minimum
received
$100,000
deposit
accounts,
to m a i n t a i n
would
business,
No minimum
a
the
that
would
comments
reserve
believes
amount
currently
balance
the
preserving
bank
public
transaction
deposits
less
that
account
transaction
customers
a wholesale
Comments
that
accept
from
Board
in
a minimum
minimum
$100,000.
close
IBF
deposit
and
conducting
limitation
deposits
The
engage
requested
time
view
withdrawal
lower
Board
minimum
of
exempt
proposed
daily
In
is m a d e
to
transactions.
require
nonbanks
offices
from
$500,000
from
foreign
enable
an
or
institutions
a minimum
A
S.
to
to
to
$500,000
activity
to
U.
permitted
transactions.
offer
of
be
therefore,
the
withdrawal
of
of
not
intended
primarily
and,
to
balance
will
not
at
withdrawal
ternative,
an
is
accounts
Minimum
or
IBF
IBF
to
IBF
to
such
required.
believes
operate
that
IBFs
business.
any
minimum
the
while
IBF
time
transaction
6
Permissible
IBF
An
to
other
Assets
IBF
IBFs,
will
or
tution
establishing
parent
institution
currency
to
its
deposit,
the
S.
placement,
Board's
provided
the
be
in
same
credit
credit
to
to
U.
the
S.
reserve
may
extended
be
or
other
their
to
foreign
the
of
from
in
the
the
a
insti
IBF's
on
Euro
foreign
form
of
similar
asset.
nonbank
foreign
operations
customers,
depository
requirement
advances
extended
in
to
of
offices
as
be
used
credit
offices
manner
security
may
are
extend
S.
Advances
advance,
funds
to
non-U.
subject
the
IBF
actions,
that
and
IBF.
will
office.
permitted
S.
the
liabilities
U.
be
t o U.
outside
a
office
loan,
Under
residents
the
United
States.
Foreign
Currency
The
business
accept
Other
in
Operations
Board
the
make
of
IBFs
Activities
which
an
chartering
in
IBF
or
activities
Supervision
the
other
same
the
on
such
of
IBFs
will
may
be
of
of
the
of
its
credit
conditions
as
well
Date
The
reserve
of
IBF
sponding
reserve
§§
461
sections
et
a
19,
s e q . , 601
is
allowing
than
not
U.
an
banking
IBFs
S.
by
IBF
to
dollars.
limiting
authorized
the
the
could
activities
institution's
engage
services.
in
institution
procedures
It
is
conjunction
as
for
other
of
be
subject
apply
that
with
to
IBF.
to
of
However,
submit
monitoring
the
supervisory
examination
the
institution
purposes
will
that
expected
establishing
for
reports
monetary
and
purposes.
to Reg u l a t i o n s
beginning
December
et
depository
establishing
period
25,
if
supervisor,
IBF
maintenance
Effective
under
by
Operations
amendments
computation
and
institution
activities
international
other
Board
fiduciary
supervision
conducted
the
Beginning
the
institution.
the
require
currencies
above,
of
facilitated
Requirements
and
the
conduct
be
Consequently,
authority
operations
of
in
providing
examination
operations
Board
as
Reporting
operations
review
other
indicated
the
will
loans
engage.
licensing
and
IBF
to
as
may
IBFs
that
States
and
Except
in
believes
United
deposits
of
and
period
3,
D
and
December
beginning
1981,
Q
of
the
s e q . , 611
et
s e q .) and
effective
for
1981,
and
the
December
17,
1981.
pursuant
25(a)
are
3,
to
Federal
the
Board's
Reserve
section
Act
7 of
the
corre
authority
(12 U . S . C .
the
International
7
Banking
and
Act
of
1978
Regulation
Q
(12 U . S . C .
(12 C F R
1.
agraph
(h)
Part
In
is
revised
to
§
section
read
as
SECTION
*
(h)
3105),
217),
are
Regulation
D
amended
follows:
204.2
of
204.2—
*
Regulation
*
the
sum,
and
its
if
positive,
of
the
(12
CFR
204)
Part
204),
par
lia b i l i t i e s " means:
under
the
laws
a
of
depository
the
United
institution
or
an
Edge
or
States,
following:
(i)
international
D
Part
*
For
organized
CFR
DEFINITIONS
*
"E u r o c u r r e n c y
Corporation
(12
follows:
(1)
Agreement
as
net
banking
facilities
balances
("IBFs")
from
(A)
a
due
its
to
its
United
non-United
States
offic
States
offices;
(ii)
under
the
laws
acquired
from
offices,
by
Edge
or
of
its
its
the
United
IBF,
Agreement
United
or
States,
States
by
assets
offices
non-United
Corporation;— ^
for
depository
(including
and
held
States
by
its
offices
held
by
its
offices
States
participations)
of
non-United
States
from
offices,
S.
or
offices
of
an
affiliated
foreign
by
parent
Edge
its
balances
(A)
or
due
from
its
less
that
to
at
no
to Uni t e d
banking
United
time
or
Agreement
facility,
or
(D)
reserves
on
1/
subparagraph
This
before
such
October
7,
credit
entity
period
its
to
resident,
computation
exceeding
an
in
the
(B)
by
period
$1
States
affiliated
to
this
not
apply
(2)
that
before
the
end
to
assets
the
by
outstanding
credit
net
of
States
$100,000
office
outstanding
an
will
be
maintaining
(1)
international
extended
that
by
an
reserve
non-United
extended
amount
to
acquired
fourth
its
and
(C)
Credit
Corporation,
and
from
acquired
credit
Agreement
and
States
Corporation;-'
had
or
non-Uiiited
non-United
that
Edge
offices
non-United
or
aggregate
Part.
were
of
by
except
a
an
States
assets
million,
institution
or
establishment.
than
offices),
offices
pursuant
does
1979,
establishing
after
the
residents
(other
States
States
States
during
States
residents
United
non-United
any
IBF,
credit
States
from'its
its
United
institution,
(iii)
to United
an
for
U.
organized
or
acquired
its
offices
non-United
of
(B)
(including
institution
participations)
were
IBF
from
acquired
from
its
computation
States
8
non-United
States
subsidiary,
controlled
extended
finance
of
by
to
one
or
or
from
IBFs
outside
a
foreign
if
the
the
sum,
if
is
the
United
of
the
controlling
States
of
the
following:
will
the
offices
national
of
the
less
banking
the
sum
(C)
the
of
the
(A)
demand
laws
of
after
United
cash
the
from
foreign
due
from
its
IBF,
its
and
non-United
States
in
due
United
due
the
deducting
States
items
balances
balances
outside
an
process
States
and
from
foreign
bank,
and
and
the
(E)
to
the
be
its
United
sold
by
foreign
S t a t e s ) , by
or
an
IBF
States
Federal
bank
its
of
or
parent
an
or
State
agency
(other
supervisory
offices
holding
affiliated
to
foreign
positive
or
by
located
non-United
Agreement
(D)
balances
States
(including
held
the
States
Corporation,
by
United
offices
or
by
its
IBFs.^
1/
This
before
subparagraph
October
7,
not
apply
or
(2)
that
before
the
end
establishing
entity
period
after
its
2.
In
3.
Section
4.
By
note
to
assets
were
of
(1)
acquired
the
fourth
that
by
an
reserve
were
IBF
acquired
from
its
computation
establishment.
section
2 0 4 . 2(t),
footnote
1
is
redesignated
as
foot
2.
Definitions.
apply:
204.8
adding
SECTION
(a)
does
1979,
a
new
204.8—
For
is
redesignated
section
204.8,
INTERNATIONAL
purposes
of
section
this
as
Part,
204.9.
follows:
BANKING
the
FACILITIES
following
bank
cent
required
and
foreign
fore
unposted
United
outside
a
assets
banks;
assets
authorities)
thereof
company,
Edge
than
its
of
organized
net
bank's
to
agency
inter
8 per
(B)
or
due
its
total
assets
branch
(including
and
equal
foreign
branch
balances
institutions
other
and
credit
to
or
States
agency's
collection;
depository
banks;
offices;
of
or
(ii)
from
borrower
States)
amount
branch's
from
central
United
as
used
corporation(s).
net
located
facility
following:
debits;
under
thereof
be
a United
(i)
cluding
affiliate")
regarded
domestic
For
positive,
not
of
office,
("foreign
proceeds
(2)
bank,
branch,
establishment
corporations
resident
affiliates
to
foreign
domestic
States
operations
foreign
or
other
more
a United
the
other
offices
affiliate
definitions
participations)
acqu
- 9 -
(1)
of
asset
of
a
and
"International
liability
depository
bank,
or
banking
an
facility
tensions
of
or
United
time
deposits
"International
by
a
instrument
that
overnight;
and
a
not
or
note,
in
(A)
that
must
(B)
that
is
depository
of
an
Edge
or
a
foreign
from
( 12 C F R
of
the
(ii)
time
not
rate
any
the
less
the
given
date
of
of
only
a
foreign
international
facility
ex
time
or
on
of
d e p o s i t " or
or
advance,
bearer
deposit
similar
form,
at
the
"IBF
obligation
or
similar
and
IBF
at
least
to
office
located
outside
under
located
date
than
by
the
the
the
laws
United
of
the
States
United
outside
the
United
States
States
an
the
IBF;
or
a
non-United
IBF;
or
institution
limitations
office
whose
under
time
section
deposits
217.3(g)
of
are
Regulation
or
(A)
that
is
on
of
deposit;
two
business
depositor
withdrawal;
a United
establishing
(5)
(3)
be
set
Corporation;
another
(2)
to
a
records
agency
banking
borrowing
organized
(4)
(1)
after
remain
office
Agreement
entity
interest
217.3(g));
days
or
and
bank;
office
exempt
"IBF" means
books
includes
acknowledgment
issued
any
(3)
States
facility
negotiable
institution
(2)
of
branch
that
placement,
issued
(1)
States
the
international
banking
deposit,
promissory
is
(i)
another
and
on
States
Agreement Corporation
deposit" means
represented
of
f a c i l i t y " or
segregated
credit.
(2)
time
institution,
Edge
banking
accounts
payable
a
upon
date
expiration
days
upon
not
specified
after
written
less
than
of
the
a
less
than
specified
date
notice
two
not
of
that
period
deposit;
actually
business
days
two
business
of
or
is
prior
required
to
Q
10
(B)
of
a
non-United
affiliate,
by
one
only
or
or
to
of
or
States
other
more
foreign
domestic
support
its
that
the
which
except
no
located
that
withdrawal
a
deposit
an
of
"IBF
making
a
represented
loan,
advance,
or
bill,
transaction.
Such
is m a i n t a i n e d
of
an
any
by
a
Edge
or
transaction
funds
in
be
may
agreement
used
depositor
or
is
permitted
any
arrangement
permitted,
if
such
or
any
only
the
extension
supplies
account.
office
under
facility
IBF
security,
extended
organized
any
an
deposit
credit
Agreement
funds
Such
form
credit"
transactions
acknowledgment
other
of
by
of
of
credit
to
located
laws
of
outside
the
the
United
United
rate
office
located
outside
a United
another
an
the
the
United
States
of
a
the
under
of
the
whose
section
a
affiliate
controlled
funds
or
a
non-United
States
time
deposits
217.3(g)
of
are
exempt
Regulation
are
used
borrower
Acknowledgment
than
shall
those
(v)) at
the
of
from
Q
(12
by
one
only
or
of
or
or
to
non-United
other
more
foreign
domestic
finance
its
the
States
corporations
operations
affiliates
resident
establishment
located
or
foreign
provided
outside
outside
a
("foreign
the Un i t e d
the
United
States.
IBF
office
or
subsidiary,
affiliate")
States
IBF;
(vi)
(b)
of
IBF;
institution
limitations
2 1 7 . 3 ( g ) );
office,
An
States
States
Corporation;
establishing
(v)
interest
States
the
and
$100,000
is
banking
note,
agreement,
(iv)
that
an
of
controlled
are
bank;
institution
CFR
States
than
$100,000
where
a
promissory
(iii)
the
funds
States;
under
less
repurchase
institution
(ii)
foreign
of
than
(i)
or
United
credit
subsidiary,
affiliate")
such
United
the
account.
placing
due
depository
the
that
to
office,
("foreign
the
"International
loan" means
may
be
outside
less
deposited
branch,
provided
withdrawal
(3)
or
funds
foreign
outside
that
or
withdrawal
closes
a
establishment
operations
affiliates
or
corporations
(C)
under
represents
resident
of
provide
specified
time
a
use
of
written
in
IBF
deposits
notice
to
and
each
of
§ 2 0 4 . 8 (a) (2) (i) (B)
deposit
relationship
or
and
a
extensions
its
§
of
customers
credit.
(other
2 0 4 . 8 ( a ) ( 3 ) (i)
credit
relationship
through
is
branch,
another
11
first
established
the
Federal
ing
facilities
outside
the
of
outside
the
of
case
receipt
or
credit
(c)
to
of
of
may
(d)
of
Establishment
of
institution,
an
or
agency
a
it
is
IBF
legally
may
submit
(Form
(e)
be
to
establish
with
first
in
a
the
the
Part
by
to
to
for
§
writing
IBF
IBF
any
business.
entity
Other
residents,
a
deposit
is
subject
deposits
IBF
A
a United
depository
States
branch
location
is
Deposits
and
loans.
However,
that
an
IBF
which
rules
it
it
of
and
shall
is
of
this
uses
of
reserve
on
its
where
only
required
and
one
to
Vault
submit
and
reports
the
concerning
Such
institution
IBFs,
Cash
an
A
it
the
Part
this
Part
and
require
shall
to
Regulation
the
shall
comply
restrictions
accounting
this
in
of
will
of
under
result
Q
subject
interest
(12
revocation
CFR
of
the
IBF.
depository
asset
the
or
Bank
that
and
prior
intends
notification
including
under
applicable
requirements.
Reserve
requirements
deposits,
operate
records
Federal
the
days
institution
recordkeeping
the
be
fourteen
an
intent.
requirements
may
to
and
with
time
ability
Recordkeeping
books
that
IBF
by
least
that
the
its
concerning
funds,
to
limitations
of
intention
Part
At
period
notify
located
institution
217)
Reserve.
and
institution
liability
operations
of
accounts
its
IBF
as
shall
of
its
segregate
IBF
required
Board.
5.
In
sections
204.3(a),
2 0 4 . 3 (a) (1) ( i i ) , 2 0 4 . 3 ( a ) ( 2 ) ( i i ) ,
204.3(c),
204.4(b)(1),
204.4(d),
204. 4 ( g ) (2)(ii)(A), 2 0 4 . 4 (g)(2)(ii)(B), and
references
as
that
time
only
in
In
S.
to m a i n t a i n
facility.
IBF
U.
Deposit-taking
IBF
or
that
IBF.
loans.
to m a k i n g
reporting
and
whenever
required
only
an
of
institution
banking
Accounts,
the
bank
operations
204. 8 ( a ) (3)(vi).
not
of
operations
affiliates
Corporation
in
finance
with
accepting
engage
each
to
An
or
Governors
international
depositor's
in
is
establish
computation
comply
the
in
restricted
may
Federal
reserve
institution's
and
are
bank
to
its
to
international
Failure
payment
Part
deposits
Transaction
statement
sources
ments.
(f)
of
this
of
by
2 0 4 . 8 ( a ) ( 2 ) (ii)(B)
foreign
requirements.
Agreement
authorized
Notification
district
on
foreign
§
only
established
of
time
an
or
the
acknowledged
first
IBFs
from
Board
2900).
the
include
be
in
used
specified
limited
established
to
on
Edge
a Report
FR
must
IBF
of
as
be
deposits
the
received
support
specified
may
States
are
activities
of
to
as
is
of
only
reserve
its
policy
deposits
requirements
IBFs
the
that
IBFs
or
notice
against
activities
lending
to
from
reserve
reserves
by
relationship
Exemption
the
used
United
such
is
States
credit
loans
it
System
be
United
extensions
the
that
Reserve
to
references
sections
to
2 0 4 . 4 (b)(1)(ii), 204.4(b)(2),
"204.8,"
sections
"204.8(a),"
"204.9,"
or
"204.9(a),"
2 0 4 . 4 (b) (2) (ii) ,
2 0 4 . 4 (g)(2)(iii),
"204.8(b)"
or
are
"204.9(b),"
redesignated
respectively.
12
6.
(b)
of
In
section
Regulation
217.1
are
Q
(12
revised
SECTION
For
unless
purposes
otherwise
of
this
CFR
to
217.1—
Part,
cludes
ing
on
every
paragraphs
(a)
and
follows:
DEFINITIONS
the
following
Demand
demand,"
hereinafter
deposit
facility
217),
as
definitions
apply
specified:
(a)
payable
Part
read
time
that
is
deposit,"
referred
not
or
a
deposit.
to
"time
as
a
deposit,"
"savings
The
term
"demand
"any
deposit
deposit,"
"international
deposit,"
as
defined
deposit.
The
in
which
is
means
"time
in
bank
this
section.
(b)
certificates
national
of
Time
deposit,"
banking
"time
facility
time
*
7.
as
deposits,
deposit,"
*
Section
open
as
term
account,"
defined
*
*
*
217.1
is
amended
by
in
"time
and
this
adding
deposit"
"inter
section.
a
new
paragraph
SECTION
*
217.1—
*
time
*
*
"I n t ernational
deposit" means
obligation
represented
or
instrument
similar
DEFINITIONS
*
(1)
"IBF
a
by
deposit,
a
that
placement,
promissory
is
not
note,
issued
in
banking
borrowing
facility
or
acknowledgment
negotiable
or
time
similar
of
advance
bearer
form
and
(1)
that
(A)
days
after
the
date
of
(B)
not
less
than
two
the
be
given
date
of
by
the
is
on
payable
a
upon
date
expiration
days
upon
depositor
withdrawal?
specified
not
less
than
two
business
deposit?
business
(C)
to
(1)
follows:
after
written
not
less
of
the
a
notice
than
specified
date
of
that
two
period
deposit?
actually
business
of
time
or
is
days
required
prior
to
d e p o s i t " or
13
(2)
a
non-United
affiliate,
or
trolled
one
by
that
States
other
or
resident
foreign
more
or
used
only
to
support
the
depositor
or
of
its
represents
foreign
the
operations
the
outside
that
the
credit
of
con
such
United
the
to
subsidiary,
affiliate")
provided
outside
located
deposited
office,
("foreign
corporations
affiliates
funds
branch,
establishment
domestic
are
a
funds
States
United
of
States;
and
(3)
which
cept
no
that
drawal
deposit
a
or
that
withdrawal
withdrawal
closes
8.
of
an
account.
In
section
of
less
less
than
217.7,
is
held
than
$100,000
paragraph
under
$100,000
is
(a)
an
agreement
is
permitted,
permitted
is
revised
if
to
such
read
or
arrangement
ex
with
as
follows:
SECTION
217.7—
MEMBER
MAXIMUM
BANKS
*
(a)
Time
deposits
is
no maximum
of
$100,000
rate
or
more
order
RATES
TIME
*
OF
AND
*
more
and
$100,000
or
of
interest
presently
or
on
of
the
IBF
time
*
Board
*
IBF
time
prescribed
issued
Governors,
June
James
Assistant
BY
deposits.
on
any
under
There
time
section
deposit
217.1(1).
*
(signed)
[SEAL)
PAYABLE
DEPOSITS
*
deposits
*
of
INTEREST
SAVINGS
*
of
*
By
ON
13,
1981.
James
McAfee
McAfee
Secretary of
the
Board
under
@FedFRASER