PART B-PURCHASES

SECTION 1-DATA FOR PROPERTY LOCATED WITHIN THOSE SMSAS IN WHICH INSTITUTION HAS HOME OR BRANCH OFFICES

SMSA TOTAL

[47 FR 751, Jan. 7, 1982]

SECTION 2-LOANS ON ALL PROPERTY LOCATED ELSEWHERE

§ 204.1 Authority, purpose and scope.

(a) Authority. This part is issued under the authority of section 19 (12 U.S.C. 461 et seq.) and other provisions of the Federal Reserve Act and of section 7 of the International Banking Act of 1978 (12 U.S.C. 3105).

(b) Purpose. This part relates to reserves that depository institutions are required to maintain for the purpose of facilitating the implementation of monetary policy by the Federal Reserve System.

(c) Scope. (1) The following depository institutions are required to maintain reserves in accordance with this part:

(i) Any insured bank as defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813(h)) or any bank that is eligible to apply to become an insured bank under section 5 of such Act (12 U.S.C. 1815);

(ii) Any savings bank or mutual savings bank as defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813(f), (g));

(iii) Any insured credit union as defined in section 101 of the Federal Credit Union Act (12 U.S.C. 1752(7)) or any credit union that is eligible to apply to become an insured credit union under section 201 of such Act (12 U.S.C. 1781);

(iv) Any member as defined in section 2 of the Federal Home Loan Bank Act (12 U.S.C. 1422(4)); and

(v) Any insured institution as defined in section 401 of the National Housing Act (12 U.S.C. 1724(a)) or any institution which is eligible to apply to become an insured institution under section 403 of such Act (12 U.S.C. 1726).

(2) Except as may be otherwise provided by the Board, a foreign bank's branch or agency located in the United States is required to comply with the provisions of this part in the same manner and to the same extent as if the branch or agency were a member bank, if its parent foreign bank (i) has total worldwide consolidated bank assets in excess of $1 billion; or (ii) is controlled by a foreign company or by a group of foreign companies that own or control foreign banks that in the aggregate have total worldwide consolidated bank assets in excess of $1 billion. In addition, any other foreign bank's branch located in the United States that is eligible to apply to become an insured bank under section 5 of the Federal Deposit Insurance Act (12 U.S.C. 1815) is required to maintain reserves in accordance with this part as a nonmember depository institution.

(3) Except as may be otherwise provided by the Board, an Edge Corporation (12 U.S.C. 611 et seq.) or an Agreement Corporation (12 U.S.C. 601 et seq.) is required to comply with the provisions of this part in the same manner and to the same extent as a member bank.

(4) This part does not apply to any financial institution that (i) is organized solely to do business with other financial institutions; (ii) is owned primarily by the financial institutions with which it does business; and (iii) does not do business with the general public.

(5) The provisions of this part do not apply to any deposit that is payable only at an office located outside the United States.

For purposes of this part, the following definitions apply unless otherwise specified:

(a)(1) "Deposit" means:

(i) The unpaid balance of money or its equivalent received or held by a depository institution in the usual course of business and for which it has given or is obligated to give credit, either conditionally or unconditionally, to an account, including interest credited, or which is evidenced by an instrument on which the depository institution is primarily liable;

(ii) Money received or held by a depository institution, or the credit given for money or its equivalent received or held by the depository institution in the usual course of business for a special or specific purpose, regardless of the legal relationships established thereby, including escrow funds, funds held as security for securities loaned by the depository institution, funds deposited as advance payment on subscriptions to United States government securities, and funds held to meet its acceptances;

(iii) An outstanding draft, cashier's check, money order, or officer's check drawn on the depository institution and issued in the usual course of business for any purpose, including payment for services, dividends, or purchases;

(iv) Any due bill or other liability or undertaking on the part of a depository institution to sell or deliver securities to, or purchase securities for the account of, any customer (including another depository institution), involving either the receipt of funds by the depository institution, regardless of the use of the proceeds, or a debit to an account of the customer before the securities are delivered. A deposit arises thereafter, if after three business days from the date of issuance of the obligation, the depository institution does not deliver the securities purchased or does not fully collateralize its obligation with securities similar to the securities purchased. A security is similar if it is of the same type and if it is of comparable maturity to that purchased by the customer;

(v) Any liability of a depository institution's affiliate that is not a deposi

tory institution, on any note, acknowledgment of adv bill, or similar obligation (v oral), with a maturity of less years, to the extent that the are used to supply or to mai availability of funds (other t tal) to the depository in except any such obligation th been issued directly by the d institution, would not constit posit. If an obligation of an a a depository institution is reg a deposit and is used to assets from the depository in the maturity of the deposit mined by the shorter of the of the obligation issued or the ing maturity of the assets pu If the proceeds from an affilia gation are placed in the depos stitution in the form of a re deposit, no reserves need b tained against the obligation o filiate since reserves are requir maintained against the deposi by the depository institution. er, the maturity of the deposi to the affiliate shall be the sh the maturity of the affiliate's tion or the maturity of the dep (vi) Credit balances;

(vii) Any liability of a deposi stitution on any promissory n knowledgment of advance, bank ceptance, or similar obligation ( or oral), including mortgage bonds, that is issued or underta a depository institution as a m obtaining funds, except any suc gation that:

(A) Is issued or undertaken ar for the account of:

(1) An office located in the States of another depository i tion, foreign bank, Edge or Agre Corporation, or New York Inves (Article XII) Company;

(2) The United States governm an agency thereof; or

(3) The Export-Import Bank United States, Minbanc Capital ( ration, the Government Develop Bank for Puerto Rico, a Federa serve Bank, a Federal Home Bank, or the National Credit 1 Administration Central Liquidit

cility;