United States · regulation · 12 CFR · 7,168 active provisions
(a) Authority. This part is issued pursuant to 12 U.S.C. 1 et seq., 12 U.S.C. 24 (Seventh), and 12 U.S.C. 93a. (b) Purpose This part prescribes standards under which national banks may purchase, sell, deal in, underwrite, and hold securities, consistent with the authority contained in 12 U.S.C. 24 (Seventh) and safe an…
(a) Capital and surplus means: (1) For qualifying community banking organizations that have elected to use the community bank leverage ratio framework, as set forth under the OCC's Capital Adequacy Standards at part 3 of this chapter: (i) A qualifying community banking organization's tier 1 capital, as used under § 3.1…
(a) Type I securities. A national bank may deal in, underwrite, purchase, and sell Type I securities for its own account. The amount of Type I securities that the bank may deal in, underwrite, purchase, and sell is not limited to a specified percentage of the bank's capital and surplus. (b) Type II securities. A nation…
(a) Calculation date. For purposes of determining compliance with 12 U.S.C. 24 (Seventh) and this part, a bank shall determine its investment limitations as of the most recent of the following dates: (1) The last day of the preceding calendar quarter; or (2) The date on which there is a change in the bank's capital cat…
(a) A national bank shall adhere to safe and sound banking practices and the specific requirements of this part in conducting the activities described in § 1.3. The bank shall consider, as appropriate, the interest rate, credit, liquidity, price, foreign exchange, transaction, compliance, and strategic risks presented…
A national bank may not purchase securities convertible into stock at the option of the issuer.
(a) Securities held in satisfaction of debts previously contracted. The restrictions and limitations of this part, other than those set forth in paragraphs (b),(c), and (d) of this section, do not apply to securities acquired: (1) Through foreclosure on collateral; (2) In good faith by way of compromise of a doubtful c…
(a) A national bank's investment in securities that no longer conform to this part but conformed when made will not be deemed in violation but instead will be treated as nonconforming if the reason why the investment no longer conforms to this part is because: (1) The bank's capital declines; (2) Issuers, obligors, or…
(a) Obligation issued by an obligor not possessing general powers of taxation. Pursuant to § 1.2(b), an obligation issued by an obligor not possessing general powers of taxation qualifies as a general obligation of a State or political subdivision for the purposes of 12 U.S.C. 24 (Seventh), if a party possessing genera…
(a) An obligation is considered supported by the full faith and credit of a State or political subdivision possessing general powers of taxation when the promise or other commitment of the State or the political subdivision will produce funds, which (together with any other funds available for the purpose) will be suff…
(a) An obligation qualifies as a Type I security if it is secured by an escrow fund consisting of obligations of the United States or general obligations of a State or a political subdivision, and the escrowed obligations produce interest earnings sufficient for the full and timely payment of interest on, and principal…
(a) Investment quality. An obligation issued for housing, university, or dormitory purposes is a Type II security only if it: (1) Qualifies as an investment security, as defined in § 1.2(e); and (2) Is issued for the appropriate purpose and by a qualifying issuer. (b) Obligation issued for university purposes. (1) An o…
(a) Authority. A national bank may provide credit life insurance to loan customers pursuant to 12 U.S.C. 24 (Seventh). (b) Purpose. The purpose of this part is to set forth the principles and standards that apply to a national bank's provision of credit life insurance and the limitations that apply to the receipt of in…
(a) Bank means a national banking association. (b) Credit life insurance means credit life, health, and accident insurance, sometimes referred to as credit life and disability insurance, and mortgage life and disability insurance. (c) Owning an interest includes: (1) Ownership through a spouse or minor child; (2) Owner…
(a) Distribution of credit life insurance income by a national bank must be consistent with the requirements and principles of this section. (b) It is an unsafe and unsound practice for any director, officer, employee, or principal shareholder of a national bank (including any entity in which this person owns an intere…
A bank employee or officer may participate in a bonus or incentive plan based on the sale of credit life insurance if payments to the employee or officer in any one year do not exceed the greater of: (a) Five percent of the recipient's annual salary; or (b) Five percent of the average salary of all loan officers partic…
(a) Nothing contained in this part prohibits a bank employee, officer, director, or principal shareholder who holds an insurance agent's license from agreeing to compensate the bank for the use of its premises, employees, or good will. However, the employee, officer, director, or principal shareholder shall turn over t…
(a) Purpose. This part establishes minimum capital requirements and overall capital adequacy standards for national banks and Federal savings associations. This part does not apply to Federal branches and agencies of foreign banks. This part includes methodologies for calculating minimum capital requirements, public di…
As used in this part: Additional tier 1 capital is defined in § 3.20(c). Adjusted allowances for credit losses (AACL) means, with respect to a national bank or Federal savings association that has adopted CECL, valuation allowances that have been established through a charge against earnings or retained earnings for ex…
For purposes of calculating risk-weighted assets under subparts D and E of this part: (a) Cleared transaction. In order to recognize certain exposures as cleared transactions pursuant to paragraphs (1)(ii), (iii) or (iv) of the definition of “cleared transaction” in § 3.2, the exposures must meet the applicable require…
(a) Minimum capital requirements. (1) A national bank or Federal savings association must maintain the following minimum capital ratios: (i) A common equity tier 1 capital ratio of 4.5 percent. (ii) A tier 1 capital ratio of 6 percent. (iii) A total capital ratio of 8 percent. (iv) A leverage ratio of 4 percent. (v) Fo…
(a) Capital conservation buffer—(1) Composition of the capital conservation buffer. The capital conservation buffer is composed solely of common equity tier 1 capital. (2) Definitions. For purposes of this section, the following definitions apply: (i) Eligible retained income. The eligible retained income of a national…
(a) Community bank leverage ratio framework. (1) Notwithstanding any other provision in this part, a qualifying community banking organization that has made an election to use the community bank leverage ratio framework under paragraph (a)(3) of this section shall be considered to have met the minimum capital requireme…
(a) Regulatory capital components. A national bank's or Federal savings association's regulatory capital components are: (1) Common equity tier 1 capital; (2) Additional tier 1 capital; and (3) Tier 2 capital. (b) Common equity tier 1 capital. Common equity tier 1 capital is the sum of the common equity tier 1 capital…
(a)(1) Applicability. For purposes of § 3.20, a national bank or Federal savings association that is not an advanced approaches national bank or Federal savings association is subject to the minority interest limitations in this paragraph (a) if a consolidated subsidiary of the national bank or Federal savings associat…