12 USC 1443 - Forms of bank stock and obligations

Collapse to view only § 1443. Forms of bank stock and obligations

§ 1421. Short title
§ 1422. Definitions
§§ 1422a, 1422b. Repealed.
§ 1423. Federal Home Loan Bank districts; number and boundaries; establishment of Federal Home Loan Banks; names
§ 1424. Eligibility for membership
§§ 1425 to 1425b. Repealed.
§ 1426. Capital structure of Federal home loan banks
§ 1426a. Exclusion from certain requirements
§ 1427. Directors
§ 1428. Examination of State laws, regulations, and procedures; studies of values, etc.
§ 1428a. Repealed.
§ 1429. Eligibility to secure advances
§ 1430. Advances to members
§ 1430a. Omitted
§ 1430b. Advances to nonmember mortgagee; terms and conditions
§ 1430c. Housing goals
§ 1431. Powers and duties of banks
§ 1432. Incorporation of banks; corporate powers; housing project loans
§ 1433. Exemption from taxation; obligations acceptable as credit on debt of home owner
§ 1434. Depositaries of public money; financial agents
§ 1435. Obligations as lawful investments; liability of United States for debentures, etc., issued by banks
§ 1436. Reserves and dividends; emergency suspensions of requirements
§ 1437. Repealed.
§ 1438. Omitted
§ 1438a. Nonadministrative expenses; expenses of studies and investigations
§§ 1439, 1439-1. Repealed.
§ 1439a. Deposits in special fund; availability for all purposes of Federal Home Loan Bank Board and Federal Home Loan Bank Administration
§ 1440. Examinations and audits
§ 1440a. Sharing of information among Federal Home Loan Banks
§ 1441. Financing Corporation
§ 1441a. Repealed.
§ 1441a-1. Definitions
§ 1441a-2. Authorization for State housing finance agencies and nonprofit entities to purchase mortgage-related assets
§ 1441a-3. RTC and FDIC properties
§ 1441b. Resolution Funding Corporation established
§ 1442. Member financial information
§ 1442a. Repealed.
§ 1443. Forms of bank stock and obligations
§ 1444. Eligibility to membership in banks
§ 1445. Succession of Federal Home Loan Banks
§ 1446. Liquidation or reorganization; acquisition of assets by other banks; assumption of liabilities
§ 1447. Repealed.
§ 1448. Effect of partial invalidity of chapter
§ 1449. Reservation of right to amend or repeal chapter

§ 1421. Short title

This chapter may be cited as the “Federal Home Loan Bank Act.”

(July 22, 1932, ch. 522, § 1, 47 Stat. 725.)

§ 1422. DefinitionsAs used in this chapter—

(1)

(A)Bank.—The term “Federal Home Loan Bank” or “Bank” means a bank established under the authority of this chapter.

(B)Bank system.—The term “Federal Home Loan Bank System” means the Federal Home Loan Banks under the supervision of the Director.

(2)State.—The term “State”, in addition to the States of the United States, includes the District of Columbia, Guam, Puerto Rico, the United States Virgin Islands, American Samoa, and the Commonwealth of the Northern Mariana Islands.

(3) The term “member” means any institution which has subscribed for the stock of a Federal Home Loan Bank.

(4) The term “home mortgage loan” means a loan made by a member upon the security of a home mortgage.

(5) The term “home mortgage” means a mortgage upon real estate, in fee simple, or on a leasehold (1) under a lease for not less than ninety-nine years which is renewable or (2) under a lease having a period of not less than fifty years to run from the date the mortgage was executed, upon which is located, or which comprises or includes, one or more homes or other dwelling units, all of which may be defined by the Director 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 chapter 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.

(6) 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 shares or stock are pledged as security for the loan, the payments made on such shares or stock plus earnings or dividends apportioned or credited thereon.

(7) An “amortized” or “installment” home mortgage loan shall, for the purposes of this chapter, be a home mortgage loan to be repaid or liquidated in not less than eight years by means of regular weekly, 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.

(8)Savings association.—The term “savings association” has the meaning given to such term in section 3 of the Federal Deposit Insurance Act [12 U.S.C. 1813].

(9)Insured depository institution.—The term “insured depository institution” means—

(A) an insured depository institution (as defined in section 3 of the Federal Deposit Insurance Act [12 U.S.C. 1813]), and

(B) except as used in sections 1441a 1

1 See References in Text note below.

and 1441b of this title, an insured credit union (as defined in section 1752 of this title).

(10)Community financial institution.—

(A)In general.—The term “community financial institution” means a member—

(i) the deposits of which are insured under the Federal Deposit Insurance Act [12 U.S.C. 1811 et seq.]; and

(ii) that has, as of the date of the transaction at issue, less than $1,000,000,000 in average total assets, based on an average of total assets over the 3 years preceding that date.

(B)Adjustments.—The $1,000,000,000 limit referred to in subparagraph (A)(ii) shall be adjusted annually by the Director, based on the annual percentage increase, if any, in the Consumer Price Index for all urban consumers, as published by the Department of Labor.

(11)Director.—The term “Director” means the Director of the Federal Housing Finance Agency.

(12)Agency.—The term “Agency” means the Federal Housing Finance Agency, established under section 4511 of this title.

(July 22, 1932, ch. 522, § 2, 47 Stat. 725; June 27, 1934, ch. 847, § 507, 48 Stat. 1264; May 28, 1935, ch. 150, § 1, 49 Stat. 293; July 14, 1952, ch. 723, § 10(c), 66 Stat. 604; Pub. L. 86–70, § 9(a), June 25, 1959, 73 Stat. 142; Pub. L. 86–624, § 5(a), July 12, 1960, 74 Stat. 411; Pub. L. 87–779, § 2(a), Oct. 9, 1962, 76 Stat. 779; Pub. L. 101–73, title VII, §§ 701(a), 710(b)(1), Aug. 9, 1989, 103 Stat. 411, 418; Pub. L. 106–102, title VI, § 602, Nov. 12, 1999, 113 Stat. 1450; Pub. L. 110–289, div. A, title II, §§ 1203, 1204(8), (10), 1211(a), July 30, 2008, 122 Stat. 2785, 2786, 2790.)

§§ 1422a, 1422b. Repealed. Pub. L. 110–289, div. A, title II, § 1204(1), July 30, 2008, 122 Stat. 2785

§ 1423. Federal Home Loan Bank districts; number and boundaries; establishment of Federal Home Loan Banks; names

(a) In general

(b) Authority to reduce districts

Notwithstanding subsection (a), the number of districts may be reduced to a number less than 8—

(1) pursuant to a voluntary merger between Banks, as approved pursuant to section 1446(b) of this title; or

(2) pursuant to a decision by the Director to liquidate a Bank pursuant to section 4617 of this title.

(July 22, 1932, ch. 522, § 3, 47 Stat. 726; July 14, 1952, ch. 723, § 10(c), 66 Stat. 604; Pub. L. 101–73, title VII, § 701(b)(1), (3)(A), Aug. 9, 1989, 103 Stat. 412; Pub. L. 110–289, div. A, title II, §§ 1204(8), 1210, July 30, 2008, 122 Stat. 2786, 2790.)

§ 1424. Eligibility for membership

(a) Criteria for eligibility

(1) In general

Any building and loan association, savings and loan association, cooperative bank, homestead association, insurance company, savings bank, community development financial institution, or any insured depository institution (as defined in section 1422 of this title), shall be eligible to become a member of a Federal Home Loan Bank if such institution—

(A) is duly organized under the laws of any State or of the United States;

(B) is subject to inspection and regulation under the banking laws, or under similar laws, of the State or of the United States or, in the case of a community development financial institution, is certified as a community development financial institution under the Community Development Banking and Financial Institutions Act of 1994 [12 U.S.C. 4701 et seq.].; 1

1 So in original.

and

(C) makes such home mortgage loans as, in the judgment of the Director, are long-term loans (except that in the case of a savings bank, this subparagraph applies only if, in the judgment of the Director, its time deposits, as defined in section 461 of this title, warrant its making such loans).

(2) Qualified thrift lender

An insured depository institution that is not a member on January 1, 1989, may become a member of a Federal Home Loan Bank only if—

(A) the insured depository institution (other than a community financial institution) has at least 10 percent of its total assets in residential mortgage loans;

(B) the insured depository institution’s financial condition is such that advances may be safely made to such institution; and

(C) the character of its management and its home-financing policy are consistent with sound and economical home financing.

(3) Certain institutions

(4) Limited exemption for community financial institutions

(5) Certain privately insured credit unions

(A) In general

(B) Certification by appropriate supervisor

(i) In general

(ii) Certification deemed valid

(C)

Notwithstanding any provision of State law authorizing a conservator or liquidating agent of a credit union to repudiate contracts, no such provision shall apply with respect to—

(i) any extension of credit from any Federal home loan bank to any credit union which is a member of any such bank pursuant to this paragraph; or

(ii) any security interest in the assets of such credit union securing any such extension of credit.

(D) Protection for certain Federal home loan bank advances

Notwithstanding any State law to the contrary, if a Bank makes an advance under section 1430 of this title to a State-chartered credit union that is not federally insured—

(i) the Bank’s interest in any collateral securing such advance has the same priority and is afforded the same standing and rights that the security interest would have had if the advance had been made to a federally insured credit union; and

(ii) the Bank has the same right to access such collateral that the Bank would have had if the advance had been made to a federally insured credit union.

(b) Location requirement

(July 22, 1932, ch. 522, § 4, 47 Stat. 726; June 13, 1933, ch. 64, § 3, 48 Stat. 129; Pub. L. 101–73, title VII, §§ 701(b)(1), (3)(A), 704(a), 710(b)(1), Aug. 9, 1989, 103 Stat. 412, 415, 418; Pub. L. 106–102, title VI, § 605, Nov. 12, 1999, 113 Stat. 1452; Pub. L. 110–289, div. A, title II, §§ 1204(8), 1206, July 30, 2008, 122 Stat. 2786, 2787; Pub. L. 114–94, div. G, title LXXXII, § 82001(a), Dec. 4, 2015, 129 Stat. 1795.)

§§ 1425 to 1425b. Repealed. Pub. L. 101–73, title VII, §§ 705, 716, 720, Aug. 9, 1989, 103 Stat. 416, 421, 423

§ 1426. Capital structure of Federal home loan banks

(a) Regulations

(1) Capital standardsNot later than 18 months after November 12, 1999, the Director shall issue regulations prescribing uniform capital standards applicable to each Federal home loan bank, which shall require each such bank to meet—

(A) the leverage requirement specified in paragraph (2); and

(B) the risk-based capital requirements, in accordance with paragraph (3).

(2) Leverage requirement

(A) In general

(B) Treatment of stock and retained earnings

(3) Risk-based capital standards

(A) Risk-based capital standards

(B) Consideration of other risk-based standards

(4) Other regulatory requirementsThe regulations issued by the Director under paragraph (1) shall—

(A) permit each Federal home loan bank to issue, with such rights, terms, and preferences, not inconsistent with this chapter and the regulations issued hereunder, as the board of directors of that bank may approve, any 1 or more of—

(i) Class A stock, which shall be redeemable in cash and at par 6 months following submission by a member of a written notice of its intent to redeem such shares; and

(ii) Class B stock, which shall be redeemable in cash and at par 5 years following submission by a member of a written notice of its intent to redeem such shares;

(B) provide that the stock of a Federal home loan bank may be issued to and held by only members of the bank, and that a bank may not issue any stock other than as provided in this section;

(C) prescribe the manner in which stock of a Federal home loan bank may be sold, transferred, redeemed, or repurchased; and

(D) provide the manner of disposition of outstanding stock held by, and the liquidation of any claims of the Federal home loan bank against, an institution that ceases to be a member of the bank, through merger or otherwise, or that provides notice of intention to withdraw from membership in the bank.

(5) Definitions of capitalFor purposes of determining compliance with the capital standards established under this subsection—

(A) permanent capital of a Federal home loan bank shall include—

(i) the amounts paid for the Class B stock; and

(ii) the retained earnings of the bank (as determined in accordance with generally accepted accounting principles); and

(B) total capital of a Federal home loan bank shall include—

(i) permanent capital;

(ii) the amounts paid for the Class A stock;

(iii) consistent with generally accepted accounting principles, and subject to the regulation of the Director, a general allowance for losses, which may not include any reserves or allowances made or held against specific assets; and

(iv) any other amounts from sources available to absorb losses incurred by the bank that the Director determines by regulation to be appropriate to include in determining total capital.

(6) Transition period

(b) Capital structure plan

(1) Approval of plansNot later than 270 days after the date of publication by the Director of final regulations in accordance with subsection (a), the board of directors of each Federal home loan bank shall submit for approval by the Director a plan establishing and implementing a capital structure for such bank that—

(A) the board of directors determines is best suited for the condition and operation of the bank and the interests of the members of the bank;

(B) meets the requirements of subsection (c); and

(C) meets the minimum capital standards and requirements established under subsection (a) and other regulations prescribed by the Director.

(2) Approval of modifications

(c) Contents of planThe capital structure plan of each Federal home loan bank shall contain provisions addressing each of the following:

(1) Minimum investment

(A) In general

(B) Investment alternatives

(i) In general

(ii) Authorized requirementsA requirement is referred to in this clause if it is a requirement for—(I) a stock purchase based on a percentage of the total assets of a member; or(II) a stock purchase based on a percentage of the outstanding advances from the bank to the member.

(D) Adjustments to minimum required investment

(2) Transition rule

(A) In general

(B) Interim purchase requirements

(3) Disposition of shares

(4) Classes of stock

(A) In general

(B) Rights requirement

(D) Liquidation of claims

(5) Limited transferability of stockThe capital structure plan of a Federal home loan bank shall—

(A) provide that any stock issued by that bank shall be available only to and held only by members of that bank and tradable only between that bank and its members; and

(B) establish standards, criteria, and requirements for the issuance, purchase, transfer, retirement, and redemption of stock issued by that bank.

(6) Bank review of planBefore filing a capital structure plan with the Director, each Federal home loan bank shall conduct a review of the plan by—

(A) an independent certified public accountant, to ensure, to the extent possible, that implementation of the plan would not result in any write-down of the redeemable bank stock investment of its members; and

(B) at least one major credit rating agency, to determine, to the extent possible, whether implementation of the plan would have any material effect on the credit ratings of the bank.

(d) Termination of membership

(1) Voluntary withdrawal

(2) Involuntary withdrawal

(A) In generalThe board of directors of a Federal home loan bank may terminate the membership of any institution if, subject to regulations of the Director, it determines that—

(i) the member has failed to comply with a provision of this chapter or any regulation prescribed under this chapter; or

(ii) the member has been determined to be insolvent, or otherwise subject to the appointment of a conservator, receiver, or other legal custodian, by a Federal or State authority with regulatory and supervisory responsibility for the member.

(B) Stock dispositionAn institution, the membership of which is terminated in accordance with subparagraph (A)—

(i) shall surrender redeemable stock to the Federal home loan bank, and shall receive in cash the par value of the stock, upon the expiration of the applicable notice period under subsection (a)(4)(A);

(ii) shall receive any dividends declared on its redeemable stock, during the applicable notice period under subsection (a)(4)(A); and

(iii) shall not be entitled to any other rights or privileges accorded to members after the date of the termination.

(C) Commencement of notice periodWith respect to an institution, the membership of which is terminated in accordance with subparagraph (A), the applicable notice period under subsection (a)(4) for each class of redeemable stock shall commence on the earlier of—

(i) the date of such termination; or

(ii) the date on which the member has provided notice of its intent to redeem such stock.

(3) Liquidation of indebtedness

(e) Redemption of excess stock

(1) In general

(2) Excess stock

(3) Priority

(f) Impairment of capital

(g) Rejoining after divestiture of all shares

(1) In general

(2) Exception for withdrawals from membership before 1998

(h) Treatment of retained earnings

(1) In general

(2) Exception

(3) Limitation

(July 22, 1932, ch. 522, § 6, 47 Stat. 727; June 27, 1934, ch. 847, § 509, 48 Stat. 1264; May 28, 1935, ch. 150, § 2, 49 Stat. 293; June 27, 1950, ch. 369, § 2, 64 Stat. 257; Aug. 11, 1955, ch. 783, title I, § 109(a)(1), 69 Stat. 640; Pub. L. 87–210, §§ 1, 2, Sept. 8, 1961, 75 Stat. 482, 483; Pub. L. 96–153, title III, § 327, Dec. 21, 1979, 93 Stat. 1121; Pub. L. 97–320, title III, §§ 353, 355, Oct. 15, 1982, 96 Stat. 1507, 1508; Pub. L. 97–457, § 16, Jan. 12, 1983, 96 Stat. 2509; Pub. L. 101–73, title VII, §§ 701(b)(1), (3)(A), 706, 710(b)(2), (3), 715, Aug. 9, 1989, 103 Stat. 412, 416, 418, 421; Pub. L. 106–102, title VI, § 608, Nov. 12, 1999, 113 Stat. 1456; Pub. L. 106–569, title XII, § 1224, Dec. 27, 2000, 114 Stat. 3036; Pub. L. 110–289, div. A, title I, § 1110(b), title II, § 1204(4), (10), July 30, 2008, 122 Stat. 2676, 2786.)

§ 1426a. Exclusion from certain requirements

(a) In general

The Federal Home Loan Banks shall be exempt from compliance with—

(1) sections 78m(e), 78n(a), and 78n(c) of title 15, and related Commission regulations;

(2) section 78o of title 15, and related Commission regulations, with respect to transactions in the capital stock of a Federal Home Loan Bank;

(3)section 78q–1 of title 15, and related Commission regulations, with respect to the transfer of the securities of a Federal Home Loan Bank; and

(4) the Trust Indenture Act of 1939 [15 U.S.C. 77aaa et seq.].

(b) Member exemption

(1) Capital stock

The capital stock issued by each of the Federal Home Loan Banks under section 1426 of this title are—

(A) exempted securities, within the meaning of section 77c(a)(2) of title 15; and

(B) exempted securities, within the meaning of section 78c(a)(12)(A) of title 15, except to the extent provided in section 78oo of title 15.

(2) Other obligations

The debentures, bonds, and other obligations issued under section 1431 of this title are—

(A) exempted securities, within the meaning of section 77c(a)(2) of title 15;

(B) government securities, within the meaning of section 78c(a)(42) of title 15; and

(3) Brokers and dealers

A person (other than a Federal Home Loan Bank effecting transactions for members of the Federal Home Loan Bank System) that effects transactions in the capital stock or other obligations of a Federal Home Loan Bank, for the account of others or for that person’s own account, as applicable, is a broker or dealer, as those terms are defined in paragraphs (4) and (5), respectively, of section 78c(a) of title 15, but is excluded from the definition of—

(A) the term “government securities broker” under section 78c(a)(43) of title 15; and

(B) the term “government securities dealer” under section 78c(a)(44) of title 15.

(d) Exemption from reporting requirements

The Federal Home Loan Banks shall be exempt from periodic reporting requirements under the securities laws pertaining to the disclosure of—

(1) related party transactions that occur in the ordinary course of the business of the Banks with members; and

(2) the unregistered sales of equity securities.

(e) Tender offers

(f) Regulations

(1) In general

(2) Considerations

In issuing regulations under this section, the Commission shall consider the distinctive characteristics of the Federal Home Loan Banks when evaluating—

(A) the accounting treatment with respect to the payment to the Resolution Funding Corporation;

(B) the role of the combined financial statements of the Federal Home Loan Banks;

(D) the accounting treatment related to the joint and several nature of the obligations of the Banks.

(g) Definitions

As used in this section—

(1) the terms “Bank”, “Federal Home Loan Bank”, “member”, and “Federal Home Loan Bank System” have the same meanings as in section 1422 of this title;

(2) the term “Commission” means the Securities and Exchange Commission; and

(3) the term “securities laws” has the same meaning as in section 78c(a)(47) of title 15.

(Pub. L. 110–289, div. A, title II, § 1208, July 30, 2008, 122 Stat. 2788.)

§ 1427. Directors

(a) Number; election; qualifications; conflicts of interest

(1) In general

(2) Board makeup

The board of directors of each Bank shall be comprised of—

(A) member directors, who shall comprise at least the majority of the members of the board of directors; and

(B) independent directors, who shall comprise not fewer than ⅖ of the members of the board of directors.

(3) Selection criteria

(A) In general

Each member of the board of directors shall be—

(i) elected by plurality vote of the members, in accordance with procedures established under this section; and

(ii) a citizen of the United States.

(B) Independent director criteria

(i) In general

(ii) Public interest

(iii) Conflicts of interest

(4) Definitions

For purposes of this section, the following definitions shall apply:

(A) Independent director

(B) Member director

(b) Directorships

(1) Member directorships

(2) Independent directorships

(A) Elections

Each independent director—

(i) shall be elected by the members entitled to vote, from among eligible persons nominated, after consultation with the Advisory Council of the Bank, by the board of directors of the Bank; and

(ii) shall be elected by a plurality of the votes of the members of the Bank at large, with each member having the number of votes for each such directorship as it has under paragraph (1) in an election to fill member directorships.

(B) Criteria

(d) Terms; rules and regulations governing nominations and elections

(e) Continuation of existing terms; directorship for the Commonwealth of Puerto Rico

(f) Vacancies

(1) In general

(2) Election process

(g) Chairperson and Vice Chairperson

(1) Election

(2) Terms

(3) Acting Chairperson

(4) Procedures

(h) Appointment where members hold less than $1,000,000 of capital stock

(i) Directors’ compensation

(1) In general

(2) Annual report

(j) Duties of directors

(k) Indemnification of directors, officers, and employees

(l)2

2 So in original. Two subsecs. (l) have been enacted.

Withholding of compensation

(l)2 Transition rule

(July 22, 1932, ch. 522, § 7, 47 Stat. 730; May 28, 1935, ch. 150, § 3, 49 Stat. 294; Aug. 11, 1955, ch. 783, title I, § 109(a)(2), 69 Stat. 640; Pub. L. 86–349, §§ 1, 2, Sept. 22, 1959, 73 Stat. 625; Pub. L. 87–211, § 1, Sept. 8, 1961, 75 Stat. 486; Pub. L. 87–676, Sept. 19, 1962, 76 Stat. 559; Pub. L. 93–541, § 3, Dec. 26, 1974, 88 Stat. 1739; Pub. L. 101–73, title VII, §§ 707, 710(b)(4), Aug. 9, 1989, 103 Stat. 417, 418; Pub. L. 106–102, title VI, § 606(a), (b), Nov. 12, 1999, 113 Stat. 1452, 1453; Pub. L. 110–289, div. A, title I, § 1113(b)(3), title II, §§ 1202, 1204(8)–(10), July 30, 2008, 122 Stat. 2678, 2783, 2786.)

§ 1428. Examination of State laws, regulations, and procedures; studies of values, etc.

The Director shall cause to be made from time to time examinations of the laws of the various States of the United States and the regulations and procedure thereunder governing conditions under which institutions of the kinds which may become members or nonmember borrowers under this chapter 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 Director, that under the laws of any such State or the regulations or procedure thereunder there would be inadequate protection to a Federal Home Loan Bank in making or collecting advances under this chapter, the Director may withhold or limit the operation of any Federal Home Loan Ban

(July 22, 1932, ch. 522, § 8, 47 Stat. 731; Pub. L. 101–73, title VII, § 701(b)(1), (3)(A), Aug. 9, 1989, 103 Stat. 412; Pub. L. 110–289, div. A, title II, § 1204(8), (9), July 30, 2008, 122 Stat. 2786.)

§ 1428a. Repealed. Pub. L. 101–73, title VII, § 718, Aug. 9, 1989, 103 Stat. 422

§ 1429. Eligibility to secure advances

Any member of a Federal Home 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. Such Federal Home Loan Bank may at its discretion deny any such application, or may grant it on such conditions as the Federal Home Loan Bank may prescribe.

(July 22, 1932, ch. 522, § 9, 47 Stat. 731; Pub. L. 101–73, title VII, §§ 701(b)(1), (3)(A), 710(a), Aug. 9, 1989, 103 Stat. 412, 418; Pub. L. 106–102, title VI, § 606(f)(1), Nov. 12, 1999, 113 Stat. 1455.)

§ 1430. Advances to members

(a) In general

(1) All advances

(2) Purposes of advances

A long-term advance may only be made for the purposes of—

(A) providing funds to any member for residential housing finance; and

(B) providing funds to any community financial institution for small businesses, small farms, small agri-businesses, and community development activities.

(3) Collateral

A Bank, at the time of origination or renewal of a loan or advance, shall obtain and maintain a security interest in collateral eligible pursuant to one or more of the following categories:

(A) Fully disbursed, whole first mortgages on improved residential property (not more than 90 days delinquent), or securities representing a whole interest in such mortgages.

(B) Securities issued, insured, or guaranteed by the United States Government or any agency thereof (including without limitation, mortgage-backed securities issued or guaranteed by the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Corporation, and the Government National Mortgage Association).

(D) Other real estate related collateral acceptable to the Bank if such collateral has a readily ascertainable value and the Bank can perfect its interest in the collateral.

(E) Secured loans for small business, agriculture, or community development activities or securities representing a whole interest in such secured loans, in the case of any community financial institution.

(4) Additional bank authority

(5) Review of certain collateral standards

(6) Definitions

(b) Appraisals and other investigations; acceptance of home mortgages as collateral security only by approval of Director

(d) Obligation to repay; additional security; sale of advances to other banks

(e) Priority of certain secured interests

Notwithstanding any other provision of law, any security interest granted to a Federal Home Loan Bank by any member of any Federal Home Loan Bank or any affiliate of any such member shall be entitled to priority over the claims and rights of any party (including any receiver, conservator, trustee, or similar party having rights of a lien creditor) other than claims and rights that—

(1) would be entitled to priority under otherwise applicable law; and

(2) are held by actual bona fide purchasers for value or by actual secured parties that are secured by actual perfected security interests.

(g)1

1 So in original. No subsec. (f) has been enacted.

Community support requirements

(1) In general

(2) Factors to be included

(h) Special liquidity advances

(1) In general

Subject to paragraph (2), the Federal Home Loan Banks may, upon the request of the Director of the Office of Thrift Supervision, make short-term liquidity advances to a savings association that—

(A) is solvent but presents a supervisory concern because of such association’s poor financial condition; and

(B) has reasonable and demonstrable prospects of returning to a satisfactory financial condition.

(2) Interest on and security for special liquidity advances

(i) Community investment program

(1) In general

(2) Community-oriented mortgage lending

For purposes of this subsection, the term “community-oriented mortgage lending” means providing loans—

(A) to finance home purchases by families whose income does not exceed 115 percent of the median income for the area,

(B) to finance purchase or rehabilitation of housing for occupancy by families whose income does not exceed 115 percent of median income for the area,

(C) to finance commercial and economic development activities that benefit low- and moderate-income families or activities that are located in low- and moderate-income neighborhoods, and

(D) to finance projects that further a combination of the purposes described in subparagraphs (A) through (C).

(j) Affordable housing program

(1) In general

(2) Standards

The Board’s 2

2 So in original. Probably should be “The Director’s”.

regulations shall permit Bank members to use subsidized advances received from the Banks to—

(A) finance homeownership by families with incomes at or below 80 percent of the median income for the area;

(B) finance the purchase, construction, or rehabilitation of rental housing, at least 20 percent of the units of which will be occupied by and affordable for very low-income households for the remaining useful life of such housing or the mortgage term; or

(C) during the 2-year period beginning on July 30, 2008, use such percentage as the Director may by regulation establish of any subsidized advances set aside to finance homeownership under subparagraph (A) to refinance loans that are secured by a first mortgage on a primary residence of any family having an income at or below 80 percent of the median income for the area.

(3) Priorities for making advances

In using advances authorized under paragraph (1), each Bank member shall give priority to qualified projects such as the following:

(A) purchase of homes by families whose income is 80 percent or less of the median income for the area,

(B) purchase or rehabilitation of housing owned or held by the United States Government or any agency or instrumentality of the United States; and

(C) purchase or rehabilitation of housing sponsored by any nonprofit organization, any State or political subdivision of any State, any local housing authority or State housing finance agency.

(4) Report

(5) Contribution to program

Each Bank shall annually contribute the percentage of its annual net earnings prescribed in the following subparagraphs to support subsidized advances through the Affordable Housing Program:

(A) In 1990, 1991, 1992, and 1993, 5 percent of the preceding year’s net income, or such prorated sums as may be required to assure that the aggregate contribution of all the Banks shall not be less than $50,000,000 for each such year.

(B) In 1994, 6 percent of the preceding year’s net income, or such prorated sum as may be required to assure that the aggregate contribution of the Banks shall not be less than $75,000,000 for such year.

(C) In 1995, and subsequent years, 10 percent of the preceding year’s net income, or such prorated sums as may be required to assure that the aggregate contribution of the Banks shall not be less than $100,000,000 for each such year.

(6) Grounds for suspending contributions

(A) In general

(B) Financial instability

(D) Monitoring suspension

(E) Limitations on grounds for suspension

(F) Congressional notification and action

(7) Failure to use amounts for affordable housing

(8) Net earnings

The net earnings of any Federal Home Loan Bank shall be determined for purposes of this paragraph—

(A) after reduction for any payment required under section 1441 or 1441b of this title; and

(B) before declaring any dividend under section 1436 of this title.

(9) Regulations

The Director shall promulgate regulations to implement this subsection. Such regulations shall, at a minimum—

(A) specify activities eligible to receive subsidized advances from the Banks under this program;

(B) specify priorities for the use of such advances;

(C) ensure that advances made under this program will be used only to assist projects for which adequate long-term monitoring is available to guarantee that affordability standards and other requirements of this subsection are satisfied;

(D) ensure that a preponderance of assistance provided under this subsection is ultimately received by low- and moderate-income households;

(E) ensure that subsidies provided by Banks to member institutions under this program are passed on to the ultimate borrower;

(F) establish uniform standards for subsidized advances under this program and subsidized lending by member institutions supported by such advances, including maximum subsidy and risk limitations for different categories of loans made under this subsection; and

(G) coordinate activities under this subsection with other Federal or federally-subsidized affordable housing activities to the maximum extent possible.

(10) Other programs

(11) Advisory Council

(12) Reports to Congress

(A) The Director shall monitor and report annually to the Congress and the Advisory Council for each Bank the support of low-income housing and community development by the Banks and the utilization of advances for these purposes.

(B) The analyses submitted by the Advisory Councils to the Director under paragraph (11) shall be included as part of the report required by this paragraph.

(C)Reports.—The Director shall annually report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives on the collateral pledged to the Banks, including an analysis of collateral by type and by Bank district.

(D)Submission to congress.—The Director shall submit the reports under subparagraphs (A) and (C) to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives, not later than 180 days after July 30, 2008.

(13) Definitions

For purposes of this subsection—

(A) Low- or moderate-income household

(B) Very low-income household

(D) Affordable for very-low income households

(k) Public use database

(1) Data

Each Federal Home Loan Bank shall provide to the Director, in a form determined by the Director, census tract level data relating to mortgages purchased, if any, including—

(A) data consistent with that reported under section 4543 of this title;

(B) data elements required to be reported under the Home Mortgage Disclosure Act of 1975 [12 U.S.C. 2801 et seq.]; and

(2) Public use database

(A) In general

(B) Proprietary information

(July 22, 1932, ch. 522, § 10, 47 Stat. 731; Apr. 27, 1934, ch. 168, § 10, 48 Stat. 646; June 27, 1934, ch. 847, § 501, 48 Stat. 1261; May 28, 1935, ch. 150, §§ 5, 6, 49 Stat. 294, 295; Mar. 28, 1941, ch. 31, § 7, 55 Stat. 62; Aug. 1, 1947, ch. 431, 61 Stat. 714; Apr. 20, 1950, ch. 94, title V, § 501, 64 Stat. 80; Sept. 1, 1951, ch. 378, title II, § 208, 65 Stat. 303; Aug. 2, 1954, ch. 649, title V, § 502, 68 Stat. 634; Pub. L. 85–857, § 13(e), Sept. 2, 1958, 72 Stat. 1264; Pub. L. 87–779, § 2(b), Oct. 9, 1962, 76 Stat. 779; Pub. L. 88–560, title IX, § 906, Sept. 2, 1964, 78 Stat. 805; Pub. L. 93–449, § 4(c), Oct. 18, 1974, 88 Stat. 1367; Pub. L. 95–128, title IV, § 406, Oct. 12, 1977, 91 Stat. 1137; Pub. L. 97–320, title III, § 352, Oct. 15, 1982, 96 Stat. 1507; Pub. L. 97–457, § 15, Jan. 12, 1983, 96 Stat. 2509; Pub. L. 100–86, title I, § 105, title III, § 306(d), Aug. 10, 1987, 101 Stat. 575, 601; Pub. L. 101–73, title VII, §§ 701(b)(1), (3)(A), 710(b)(4), (5), (c), 714, 721, Aug. 9, 1989, 103 Stat. 412, 418, 419, 423; Pub. L. 102–550, title XIII, § 1392(a), Oct. 28, 1992, 106 Stat. 4009; Pub. L. 106–102, title VI, §§ 604(a)–(c), 606(f)(2), Nov. 12, 1999, 113 Stat. 1451, 1452, 1455; Pub. L. 110–289, div. A, title II, §§ 1204(5), (8)–(10), (12), 1211(b), 1212, 1218, July 30, 2008, 122 Stat. 2786, 2790, 2793.)

§ 1430a. Omitted

§ 1430b. Advances to nonmember mortgagee; terms and conditions

(a) In general

(b) Exception

An advance made to a State housing finance agency for the purpose of facilitating mortgage lending that benefits individuals and families that meet the income requirements set forth in section 142(d) or 143(f) of title 26, need not be collateralized by a mortgage insured under title II of the National Housing Act [12 U.S.C. 1707 et seq.] or otherwise, if—

(1) such advance otherwise meets the requirements of this subsection; and

(2) such advance meets the requirements of section 1430(a) of this title, and any real estate collateral for such loan comprises single family or multifamily residential mortgages.

(July 22, 1932, ch. 522, § 10b, as added May 25, 1935, ch. 150, § 7, 49 Stat. 295; amended Pub. L. 101–73, title VII, § 701(b)(1), (3)(A), Aug. 9, 1989, 103 Stat. 412; Pub. L. 102–550, title XIII, § 1392(b), Oct. 28, 1992, 106 Stat. 4009; Pub. L. 110–289, div. A, title II, § 1204(8), July 30, 2008, 122 Stat. 2786.)

§ 1430c. Housing goals

(a) In general

(b) Considerations

(d) Monitoring and enforcement of goals

(e) Annual report

(July 22, 1932, ch. 522, § 10C, as added Pub. L. 110–289, div. A, title II, § 1205, July 30, 2008, 122 Stat. 2786.)

§ 1431. Powers and duties of banks

(a) Borrowing money; issuing bonds and debentures; general powers

(b) Issuance of consolidated Federal Home Loan Bank debentures; restrictions

(d) Additional or substituted collateral on adjustment of equities

(e) Acceptance of deposits; restrictions on transaction of banking business; collection and settlement of checks, drafts, etc.; charges; rules and regulations

(1) Each Federal Home Loan Bank shall have power to accept deposits made by members of such bank or by any other Federal Home Loan Bank or other instrumentality of the United States, upon such terms and conditions as the Director may prescribe, but no Federal Home Loan Bank shall transact any banking or other business not incidental to activities authorized by this chapter.

(2)

(A) The Director may, subject to such rules and regulations, including definitions of terms used in this paragraph, as the Director shall from time to time prescribe, authorize Federal Home Loan Banks to be drawees of, and to engage in, or be agents or intermediaries for, or otherwise participate or assist in, the collection and settlement of (including presentment, clearing, and payment of, and remitting for), checks, drafts, or any other negotiable or nonnegotiable items or instruments of payment drawn on or issued by members of any Federal Home Loan Bank or by institutions which are eligible to make application to become members pursuant to section 1424 of this title, and to have such incidental powers as the Director shall find necessary for the exercise of any such authorization.

(B) A Federal Home Loan Bank shall make charges, to be determined and regulated by the Director consistent with the principles set forth in section 248a(c) of this title, or utilize the services of, or act as agent for, or be a member of, a Federal Reserve bank, clearinghouse, or any other public or private financial institution or other agency, in the exercise of any powers or functions pursuant to this paragraph.

(C) The Director is authorized, with respect to participation in the collection and settlement of any items by Federal Home Loan Banks, and with respect to the collection and settlement (including payment by the payor institution) of items payable by Federal savings and loan associations and Federal mutual savings banks, to prescribe rules and regulations regarding the rights, powers, responsibilities, duties, and liabilities, including standards relating thereto, of such Federal Home Loan Banks, associations, or banks and other parties to any such items or their collection and settlement. In prescribing such rules and regulations, the Director may adopt or apply, in whole or in part, general banking usage and practices, and, in instances or respects in which they would otherwise not be applicable, Federal Reserve regulations and operating letters, the Uniform Commercial Code, and clearinghouse rules.

(f) Rediscount of notes held by other banks; purchase of bonds of other banks

(g) Reserves

(h) Investment of surplus funds

(i) Treasury purchase of banks’ obligations; exercise of authority

(j) Audits

(k) Bank loans to the Deposit Insurance Fund

(1) Loans authorized

(2) Liability of the Fund

(3) Interest on and security for such loans

Any loan by a Federal Home Loan Bank pursuant to paragraph (1) shall—

(A) bear a rate of interest not less than such Bank’s current marginal cost of funds, taking into account the maturities involved; and

(B) be adequately secured.

(l) Temporary authority of Treasury to purchase obligations; conditions

(1) Authority to purchase

(A) General authority

(B) Emergency determination required

In connection with any use of this authority, the Secretary must determine that such actions are necessary to—

(i) provide stability to the financial markets;

(ii) prevent disruptions in the availability of mortgage finance; and

(iii) protect the taxpayer.

To protect the taxpayers, the Secretary of the Treasury shall take into consideration the following in connection with exercising the authority contained in this paragraph:

(i) The need for preferences or priorities regarding payments to the Government.

(ii) Limits on maturity or disposition of obligations or securities to be purchased.

(iii) The Federal Home Loan Bank’s plan for the orderly resumption of private market funding or capital market access.

(iv) The probability of the Federal Home Loan Bank fulfilling the terms of any such obligation or other security, including repayment.

(v) The need to maintain the Federal Home Loan Bank’s status as a private shareholder-owned company.

(vi) Restrictions on the use of Federal Home Loan Bank resources, including limitations on the payment of dividends and executive compensation and any such other terms and conditions as appropriate for those purposes.

(D) Reports to Congress

(2) Rights; sale of obligations and securities

(A) Exercise of rights

(B) Sale of obligations

The Secretary of the Treasury shall deposit in the General Fund of the Treasury any amounts received by the Secretary from the sale of any obligation acquired by the Secretary under this subsection, where such amounts shall be—

(i) dedicated for the sole purpose of deficit reduction; and

(ii) prohibited from use as an offset for other spending increases or revenue reductions.

(D) Application of sunset to purchased obligations

(3) Funding

(4) Termination of authority

(5) Authority of the Director with respect to executive compensation

(July 22, 1932, ch. 522, § 11, 47 Stat. 733; June 27, 1934, ch. 847, § 503, 48 Stat. 1261; June 27, 1950, ch. 369, §§ 3, 4, 64 Stat. 257; Aug. 2, 1954, ch. 649, title II, § 204(a), 68 Stat. 622; Pub. L. 88–560, title VII, § 701(d)(1), Sept. 2, 1964, 78 Stat. 800; Pub. L. 90–448, title VIII, § 807(k), Aug. 1, 1968, 82 Stat. 545; Pub. L. 91–151, title I, § 3, Dec. 23, 1969, 83 Stat. 374; Pub. L. 91–609, title IX, § 914, Dec. 31, 1970, 84 Stat. 1815; Pub. L. 93–383, title VIII, § 805(c)(2), Aug. 22, 1974, 88 Stat. 727; Pub. L. 93–495, title I, § 112, Oct. 28, 1974, 88 Stat. 1506; Pub. L. 96–153, title III, § 324, Dec. 21, 1979, 93 Stat. 1121; Pub. L. 96–221, title III, § 311, Mar. 31, 1980, 94 Stat. 149; Pub. L. 97–320, title I, § 125(c), Oct. 15, 1982, 96 Stat. 1485; Pub. L. 101–73, title VII, §§ 701(b)(1)–(3)(A), (c), 709, 710(b)(6), Aug. 9, 1989, 103 Stat. 412, 418; Pub. L. 104–208, div. A, title II, § 2704(d)(11)(A), div. D, title II, § 208(h)(2), Sept. 30, 1996, 110 Stat. 3009–489, 3009–747; Pub. L. 108–271, § 8(b), July 7, 2004, 118 Stat. 814; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 9(d)(1), Feb. 15, 2006, 119 Stat. 3616; Pub. L. 110–289, div. A, title I, § 1117(c), title II, § 1204(3), (8), (9), July 30, 2008, 122 Stat. 2686, 2786; Pub. L. 111–203, title XIII, § 1304(c), July 21, 2010, 124 Stat. 2134.)

§ 1432. Incorporation of banks; corporate powers; housing project loans

(a) The directors of each Federal Home Loan Bank shall, in accordance with such rules and regulations as the Director may prescribe, make and file with the Director at the earliest practicable date after the establishment of such bank, an organization certificate which shall contain such information as the Director may require. Upon the making and filing of such organization certificate with the Director, 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 Director 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; 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,; 1

1 So in original.

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 the board of directors of the bank, to prescribe, amend, and repeal by-laws governing the manner in which its affairs may be administered, consistent with applicable laws and regulations, as administered by the Director. No officer, employee, attorney, or agent of a Federal home loan bank who receives compensation, may be a member of the board of directors. Each such bank shall have all such incidental powers, not inconsistent with the provisions of this chapter, as are customary and usual in corporations generally.

(b) Subject to such regulations as may be prescribed by the Director, one or more Federal home loan banks may acquire, hold, or dispose of, in whole or in part, or facilitate such acquisition, holding, or disposition by members of any such bank of, housing project loans, or interests therein, having the benefit of any guaranty under section 2181 of title 22, as now or hereafter in effect, or loans, or interests therein, having the benefit of any guaranty under section 2184 of title 22 or any commitment or agreement with respect to such loans, or interests therein, made pursuant to either of such sections. This authority extends to the acquisition, holding, and disposition of loans, or interests therein, having the benefit of any guaranty under section 2181 or 2182 of title 22 or such sections as hereafter amended or extended, or of any commitment or agreement for any such guaranty.

(July 22, 1932, ch. 522, § 12, 47 Stat. 735; Pub. L. 89–754, title X, § 1016(a), Nov. 3, 1966, 80 Stat. 1293; Pub. L. 90–448, title XVII, § 1717, Aug. 1, 1968, 82 Stat. 609; Pub. L. 91–609, title IX, § 907(a), Dec. 31, 1970, 84 Stat. 1811; Pub. L. 101–73, title VII, § 701(b)(1), (3)(A), Aug. 9, 1989, 103 Stat. 412; Pub. L. 106–102, title VI, § 606(d), Nov. 12, 1999, 113 Stat. 1454; Pub. L. 110–289, div. A, title II, § 1204(8), (10), July 30, 2008, 122 Stat. 2786.)

§ 1433. Exemption from taxation; obligations acceptable as credit on debt of home owner

Any and all notes, debentures, bonds, and other such obligations issued by any bank, and consolidated Federal Home Loan Bank bonds and debentures, shall be exempt both as to principal and 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 franchise, its capital, reserves, and surplus, its advances, and its 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 1

1 So in original. Word “in” probably should not appear.

any real property of the bank shall be 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.

(July 22, 1932, ch. 522, § 13, 47 Stat. 735; May 28, 1935, ch. 150, § 8, 49 Stat. 295.)

§ 1434. Depositaries of public money; financial agents

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.

(July 22, 1932, ch. 522, § 14, 47 Stat. 736.)

§ 1435. Obligations as lawful investments; liability of United States for debentures, etc., issued by banks

Obligations of the Federal Home Loan Banks issued with the approval of the Board or the Director under this chapter shall be lawful investments, and may be accepted as security, for all fiduciary, trust, and public 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 general performance of their powers under this chapter. All obligations of Federal Home Loan Banks shall plainly state that such obligations are not obligations of the United States and are not guaranteed by the United States.

(July 22, 1932, ch. 522, § 15, 47 Stat. 736; Pub. L. 101–73, title VII, § 701(b)(1), (3)(A), Aug. 9, 1989, 103 Stat. 412; Pub. L. 110–289, div. A, title II, § 1204(7), July 30, 2008, 122 Stat. 2786.)

§ 1436. Reserves and dividends; emergency suspensions of requirements

(a) Accumulation and maintenance of reserves; payment of dividends

(b) Assistance to member institutions in event of severe financial conditions

(1) In general

Notwithstanding subsection (a) of this section, if—

(A) a Federal Home Loan Bank incurs a chargeoff or an expense in connection with such bank’s investment in the stock of the Financing Corporation under section 1441 of this title;

(B) the Director determines there is an extraordinary need for the member institutions of the bank to receive dividends; and

(C) the bank has reduced all reserves (other than the reserve account required by the first 2 sentences of subsection (a)) to zero,

the Director may authorize such bank to declare and pay dividends out of undivided profits (as such term is defined in section 1441(d)(7) of this title) or the reserve account required by the first 2 sentences of subsection (a).

(2) Requirements of section 1441 of this title not affected

(July 22, 1932, ch. 522, § 16, 47 Stat. 736; Aug. 2, 1954, ch. 649, title II, § 204(a), 68 Stat. 622; Pub. L. 88–560, title VII, § 701(d)(2), Sept. 2, 1964, 78 Stat. 800; Pub. L. 90–448, title VIII, § 807(l), Aug. 1, 1968, 82 Stat. 545; Pub. L. 93–383, title VIII, § 805(c)(3), Aug. 22, 1974, 88 Stat. 727; Pub. L. 97–320, title I, § 124, Oct. 15, 1982, 96 Stat. 1485; Pub. L. 100–86, title III, § 306(a), Aug. 10, 1987, 101 Stat. 600; Pub. L. 101–73, title VII, §§ 701(b)(1), (3)(A), 724(a), Aug. 9, 1989, 103 Stat. 412, 428; Pub. L. 106–102, title VI, § 606(g), Nov. 12, 1999, 113 Stat. 1455; Pub. L. 110–289, div. A, title II, § 1204(8), July 30, 2008, 122 Stat. 2786.)

§ 1437. Repealed. Pub. L. 101–73, title VII, § 703(a), Aug. 9, 1989, 103 Stat. 415

§ 1438. Omitted

§ 1438a. Nonadministrative expenses; expenses of studies and investigations

On and after July 12, 1960, expenses of the Board in making studies or investigations specifically directed by law, or requested by the Congress or either House thereof or by a committee of either House, including services authorized by section 3109 of title 5, shall be considered as nonadministrative expenses.

(Pub. L. 86–626, title II, § 201, July 12, 1960, 74 Stat. 441.)

§§ 1439, 1439–1. Repealed. Pub. L. 101–73, title VII, §§ 708, 712, Aug. 9, 1989, 103 Stat. 418, 419

§ 1439a. Deposits in special fund; availability for all purposes of Federal Home Loan Bank Board and Federal Home Loan Bank Administration

All moneys and funds heretofore deposited in the Treasury of the United States under the last sentence of section 1439 1

1 See References in Text note below.

of this title (including unexpended balances of moneys appropriated therefrom for administrative expenses), and hereafter all moneys and funds which would, except for this provision, be so depositable thereunder, shall be deposited with the Treasurer of the United States in a special deposit account and shall be available, retroactively as well as prospectively, for expenditure for all purposes of the Federal Home Loan Bank Board and the Federal Home Loan Bank Administration, subject to subsections (a) and (b) of section 712a of title 15.

(June 26, 1943, ch. 145, title I, § 101, 57 Stat. 186; 1947 Reorg. Plan No. 3, eff. July 27, 1947, 12 F.R. 4981, 61 Stat. 954; Aug. 11, 1955, ch. 783, title I, § 109(a)(3), 69 Stat. 640.)

§ 1440. Examinations and audits

The Director shall from time to time, at least annually, require examinations and reports of condition of all Federal Home Loan Banks in such form as the Director shall prescribe and shall furnish periodically statements based upon the reports of the banks to the Director. For the purposes of this chapter, examiners appointed by the Director shall be subject to the same requirements, responsibilities, and penalties as are applicable to examiners under the National Bank Act [12 U.S.C. 21 et seq.] and the Federal Reserve Act [12 U.S.C. 221 et seq.], and shall have, in the exercise of functions under this chapter, the same powers and privileges as are vested in such examiners by law. In addition to such examinations, the Comptroller General may audit or examine the Director and the Banks, to determine the extent to which the Director and the Banks are fairly and effectively fulfilling the purposes of this chapter.

(July 22, 1932, ch. 522, § 20, 47 Stat. 738; June 27, 1950, ch. 369, § 10, 64 Stat. 259; Aug. 2, 1954, ch. 649, title VIII, § 802(f), 68 Stat. 643; Pub. L. 101–73, title VII, §§ 701(b)(1), (3)(A), 702(b), Aug. 9, 1989, 103 Stat. 412, 415; Pub. L. 110–289, div. A, title II, § 1204(8), (9), July 30, 2008, 122 Stat. 2786.)

§ 1440a. Sharing of information among Federal Home Loan Banks

(a) Information on financial condition

(b) Sharing of information

(1) In general

(2) Limitation

(d) No waiver of privilege

(July 22, 1932, ch. 522, § 20A, as added Pub. L. 110–289, div. A, title II, § 1207, July 30, 2008, 122 Stat. 2787.)

§ 1441. Financing Corporation

(a) Establishment

(b) Management of Financing Corporation

(1) DirectorateThe Financing Corporation shall be under the management of a directorate composed of 3 members as follows:

(A) The Director of the Office of Finance of the Federal Home Loan Banks (or the head of any successor to such office).

(B) 2 members selected by the Director from among the presidents of the Federal Home Loan Banks.

(2) Terms

(3) VacancyIf any member leaves the office in which such member was serving when appointed to the Directorate—

(A) such member’s service on the Directorate shall terminate on the date such member leaves such office; and

(B) the successor to the office of such member shall serve the remainder of such member’s term.

(4) Equal representation of banks

(5) Chairperson

(6) Staff

(A) No paid employees

(B) Powers

(7) Administrative expenses

(A) In general

(B) Pro rata distributionThe amount each Federal Home Loan Bank shall pay shall be determined by the Director by multiplying the total administrative expenses for any period by the percentage arrived at by dividing—

(i) the aggregate amount the Director required such bank to invest in the Financing Corporation (as of the time of such determination) under paragraphs (4) and (5) of subsection (d) (as computed without regard to paragraph (3) or (6) of such subsection); by

(ii) the aggregate amount the Director required all Federal Home Loan Banks to invest (as of the time of such determination) under such paragraphs.

(i) issuance costs (as such term is defined in subsection (g)(5)(A));

(ii) any interest on (and any redemption premium with respect to) any obligation of the Financing Corporation; or

(iii) custodian fees (as such term is defined in subsection (g)(5)(B)).

(8) Regulation by Director

(9) No compensation from Financing Corporation

(c) Powers of Financing CorporationThe Financing Corporation shall have only the following powers, subject to the other provisions of this section and such regulations, orders, and directions as the Director may prescribe:

(1) To issue nonvoting capital stock to the Federal Home Loan Banks.

(2) To invest in any security issued by the Federal Savings and Loan Insurance Corporation under section 1725(b) of this title prior to August 9, 1989, and thereafter to transfer the proceeds of any obligation issued by the Financing Corporation to the FSLIC Resolution Fund.

(3) To issue debentures, bonds, or other obligations and to borrow, to give security for any amount borrowed, and to pay interest on (and any redemption premium with respect to) any such obligation or amount.

(4) To impose assessments in accordance with subsection (f).

(5) To adopt, alter, and use a corporate seal.

(6) To have succession until dissolved.

(7) To enter into contracts.

(8) To sue and be sued in its corporate capacity, and to complain and defend in any action brought by or against the Financing Corporation in any State or Federal court of competent jurisdiction.

(9) To exercise such incidental powers not inconsistent with the provisions of this section as are necessary or appropriate to carry out the provisions of this section.

(d) Capitalization of Financing Corporation

(1) Purchase of capital stock by Federal Home Loan Banks

(A) In general

(B) Par value; transferability

(2) Aggregate dollar amount limitation on all investments

(3) Maximum investment amount limitation for each Federal Home Loan BankThe cumulative amount of funds invested in nonvoting capital stock of the Financing Corporation by each Federal Home Loan Bank shall not exceed the aggregate amount of—

(A) the sum of—

(i) the reserves maintained by such bank on December 31, 1985, pursuant to the requirement contained in the first 2 sentences of section 1436 of this title; and

(ii) the undivided profits (as defined in paragraph (7)) of such bank on such date; and

(B) the sum of—

(i) the amounts added to reserves after December 31, 1985, pursuant to the requirement contained in the first 2 sentences of section 1436 of this title; and

(ii) the undivided profits of such bank accruing after such date.

(4) Pro rata distribution of 1st $1,000,000,000 invested in Financing Corporation by Home Loan Banks

(5) Pro rata distribution of amounts required to be invested in excess of $1,000,000,000With respect to any amount in excess of the $1,000,000,000 amount referred to in paragraph (4) which the Director may require the Federal Home Loan Banks to invest in capital stock of the Financing Corporation under this subsection, the amount which each Federal Home Loan Bank (or any successor to such bank) shall invest shall be determined by the Director by multiplying such excess amount by the percentage arrived at by dividing—

(A) the sum of the total assets (as of the most recent December 31) held by all Savings Association Insurance Fund members which are members of such bank; by

(B) the sum of the total assets (as of such date) held by all Savings Association Insurance Fund members which are members of any Federal Home Loan Bank.

(6) Special provisions relating to maximum amount limitations

(A) In generalIf the amount any Federal Home Loan Bank is required to invest in capital stock of the Financing Corporation pursuant to a determination by the Director under paragraph (5) (or under subparagraph (B) of this paragraph) exceeds the maximum investment amount applicable with respect to such bank under paragraph (3) at the time of such determination (hereinafter in this paragraph referred to as the “excess amount”)—

(i) the Director shall require each remaining Federal Home Loan Bank to invest (in addition to the amount determined under paragraph (5) for such remaining bank and subject to the maximum investment amount applicable with respect to such remaining bank under paragraph (3) at the time of such determination) in such capital stock on behalf of the bank in the amount determined under subparagraph (B);

(ii) the Director shall require the bank to subsequently purchase the excess amount of capital stock from the remaining banks in the manner described in subparagraph (C); and

(iii) the requirements contained in subparagraphs (D) and (E) relating to the use of net earnings shall apply to such bank until the bank has purchased all of the excess amount of capital stock.

(B) Allocation of excess amount among remaining Home Loan BanksThe amount each remaining Federal Home Loan Bank shall be required to invest under subparagraph (A)(i) is the amount determined by the Director by multiplying the excess amount by the percentage arrived at by dividing—

(i) the amount of capital stock of the Financing Corporation held by such remaining bank at the time of such determination; by

(ii) the aggregate amount of such stock held by all remaining banks at such time.

(D) Limitation on dividends

(E) Transfer to account for purchase of stock required

(7) Undivided profits definedFor purposes of paragraph (3), the term “undivided profits” means retained earnings minus the sum of—

(A) that portion required to be added to reserves maintained pursuant to the first two sentences of section 1436 of this title; and

(B) the dollar amounts held by the respective Federal Home Loan Banks in special dividend stabilization reserves on December 31, 1985, as determined under the following table:

(e) Obligations of Financing Corporation

(1) Limitation on amount of outstanding obligationsThe aggregate amount of obligations of the Financing Corporation which may be outstanding at any time (as determined by the Director) shall not exceed the lesser of—

(A) an amount equal to the greater of—

(i) 5 times the amount of the nonvoting capital stock of the Financing Corporation which is outstanding at such time; or

(ii) the sum of the face amounts (the amount of principal payable at maturity) of securities described in subsection (g)(2) which are held at such time in the segregated account established pursuant to such subsection; or

(B) $10,825,000,000.

(2) Termination of borrowing authority

(3) Limitation on term of obligationsNo obligation of the Financing Corporation may be issued which matures—

(A) more than 30 years after the date of issue; or

(B) after December 31, 2026.

(4) Investment of United States funds in obligations

(5) Market for obligations

(6) No full faith and credit of the United States

(7) Tax exempt status

(A) In general

(B) Exception

(8) Obligations are exempt securities

(9) Minority participation in public offerings

(f) Sources of funds for interest payments; Financing Corporation assessment authorityThe Financing Corporation shall obtain funds for anticipated interest payments, issuance costs, and custodial fees on obligations issued hereunder from the following sources:

(1) Preenactment assessments

(2) New assessment authority

(3) Receivership proceeds

(g) Use and disposition of assets of Financing Corporation not invested in FSLIC

(1) In generalSubject to such regulations, restrictions, and limitations as may be prescribed by the Director, assets of the Financing Corporation, which are not invested in capital certificates or capital stock issued by the Federal Savings and Loan Insurance Corporation under section 1725(b)(1)(A) of this title before August 9, 1989, and after August 9, 1989, in capital certificates issued by the FSLIC Resolution Fund, shall be invested in—

(A) direct obligations of the United States;

(B) obligations, participations, or other instruments of, or issued by, the Federal National Mortgage Association or the Government National Mortgage Association;

(C) mortgages, obligations, or other securities for sale by, or which have been disposed of by, the Federal Home Loan Mortgage Corporation under section 1454 or 1455 of this title; or

(D) any other security in which it is lawful for fiduciary and trust funds to be invested under the laws of any State.

(2) Segregated account for zero coupon instruments held to assure payment of principalThe Financing Corporation shall invest in, and hold in a segregated account, noninterest bearing instruments—

(A) which are securities described in paragraph (1); and

(B) the total of the face amounts (the amount of principal payable at maturity) of which is approximately equal to the aggregate amount of principal on the obligations of the Financing Corporation,

to assure the repayment of principal on obligations of the Financing Corporation. For purposes of the foregoing, the Financing Corporation shall be deemed to hold noninterest bearing instruments that it lends temporarily to primary United States Treasury dealers in order to enhance market liquidity and facilitate deliveries, provided that United States Treasury securities of equal or greater value have been delivered as collateral.

(3) Dollar amount limitation on investment in zero coupon instruments for segregated account

(4) Exception for payment of issuance costs, interest, and custodian feesNotwithstanding the requirements of paragraph (1), the assets of the Financing Corporation referred to in paragraph (1) which are not invested under paragraph (2) may be used to pay—

(A) issuance costs;

(B) any interest on (and any redemption premium with respect to) any obligation of the Financing Corporation; and

(5) DefinitionsFor purposes of this subsection—

(A) Issuance costsThe term “issuance costs”—

(i) means issuance fees and commissions incurred by the Financing Corporation in connection with the issuance or servicing of any obligation of the Financing Corporation; and

(ii) includes legal and accounting expenses, trustee and fiscal and paying agent charges, costs incurred in connection with preparing and printing offering materials, and advertising expenses, to the extent that any such cost or expense is incurred by the Financing Corporation in connection with issuing any obligation.

(B) Custodian feesThe term “custodian fee” means—

(i) any fee incurred by the Financing Corporation in connection with the transfer of any security to, or the maintenance of any security in, the segregated account established under paragraph (2); and

(ii) any other expense incurred by the Financing Corporation in connection with the establishment or maintenance of such account.

(h) Miscellaneous provisions relating to Financing Corporation

(1) Treatment for certain purposes

(2) Federal Reserve banks as depositaries and fiscal agents

(3) Applicability of certain provisions relating to Government corporation

(i) Termination of Financing Corporation

(1) In generalThe Financing Corporation shall be dissolved, as soon as practicable, after the earlier of—

(A) the maturity and full payment of all obligations issued by the Financing Corporation pursuant to this section; or

(B)December 31, 2026.

(2) Director authority to conclude the affairs of Financing Corporation

(j) Regulations

(k) DefinitionsFor purposes of this section, the following definitions shall apply:

(1) Directorate

(2) Net earnings

(3) Insured depository institution

(July 22, 1932, ch. 522, § 21, as added Pub. L. 100–86, title III, § 302, Aug. 10, 1987, 101 Stat. 585; amended Pub. L. 101–73, title V, § 512, title VII, §§ 701(b)(2), 713, Aug. 9, 1989, 103 Stat. 406, 412, 419; Pub. L. 102–233, title I, § 104, title III, § 302(b), Dec. 12, 1991, 105 Stat. 1762, 1767; Pub. L. 102–550, title XVI, § 1611(c), Oct. 28, 1992, 106 Stat. 4090; Pub. L. 104–208, div. A, title II, § 2703(a), Sept. 30, 1996, 110 Stat. 3009–485; Pub. L. 109–173, § 9(d)(2), Feb. 15, 2006, 119 Stat. 3616; Pub. L. 110–289, div. A, title II, § 1204(6), (8), (12), July 30, 2008, 122 Stat. 2786.)

§ 1441a. Repealed. Pub. L. 111–203, title III, § 364(b), July 21, 2010, 124 Stat. 1555

§ 1441a–1. Definitions

For purposes of section 1441a–2 of this title:

(1) State housing finance authority

The term “State housing finance authority” means any public agency, authority, or corporation which—

(A) serves as an instrumentality of any State or any political subdivision of any State; and

(B) functions as a source of residential mortgage loan financing in that State.

(2) Nonprofit entity

(3) Mortgage-related assets

The term “mortgage-related assets” means—

(A) residential mortgage loans secured by 1- to 4-family or multifamily dwellings; and

(B) real property improved with 1- to 4-family or multifamily residential dwellings,

which are located within the jurisdiction of the applicable State housing finance authority or within the geographical area served by the nonprofit entity.

(4) Net income

(Pub. L. 101–73, title XIII, § 1301, Aug. 9, 1989, 103 Stat. 547.)

§ 1441a–2. Authorization for State housing finance agencies and nonprofit entities to purchase mortgage-related assets

(a) Authorization

(b) Investment requirement

(Pub. L. 101–73, title XIII, § 1302, Aug. 9, 1989, 103 Stat. 548.)

§ 1441a–3. RTC and FDIC properties

(a) Reports

(1) Submission

(2) Consultation

(b) Limitation on transfer

(1) Notice

(2) Expression of serious interest

(3) Prohibition of transfer

(4) Offers and permitted transfer

(1) Corporation concernedThe term “corporation concerned” means—

(A) the Federal Deposit Insurance Corporation, with respect to matters relating to the Federal Deposit Insurance Corporation; and

(B) the Resolution Trust Corporation, with respect to matters relating to the Resolution Trust Corporation.

(2) Covered propertyThe term “covered property” means any property—

(A) to which—

(i) the Resolution Trust Corporation has acquired title in its corporate or receivership capacity; or

(ii) the Federal Deposit Insurance Corporation has acquired title in its corporate capacity or which was acquired by the former Federal Savings and Loan Insurance Corporation in its corporate capacity; and

(B) that—

(i) is located within the John H. Chafee Coastal Barrier Resources System; or

(ii) is undeveloped, greater than 50 acres in size, and adjacent to or contiguous with any lands managed by a governmental agency primarily for wildlife refuge, sanctuary, open space, recreational, historical, cultural, or natural resource conservation purposes.

(3) Governmental agency

(4) UndevelopedThe term “undeveloped” means—

(A) containing few manmade structures and having geomorphic and ecological processes that are not significantly impeded by any such structures or human activity; and

(B) having natural, cultural, recreational, or scientific value of special significance.

(Pub. L. 101–591, § 10, Nov. 16, 1990, 104 Stat. 2939; Pub. L. 106–167, § 3(c)(5), Dec. 9, 1999, 113 Stat. 1804.)

§ 1441b. Resolution Funding Corporation established

(a) Purpose

(b) Establishment

(1) DirectorateThe Funding Corporation shall be under the management of a Directorate composed of 3 members as follows:

(A) The director of the Office of Finance of the Federal Home Loan Banks (or the head of any successor office).

(B) 2 members selected by the Thrift Depositor Protection Oversight Board from among the presidents of the Federal Home Loan Banks.

(2) Terms

(3) VacancyIf any member leaves the office in which such member was serving when appointed to the Directorate—

(A) such member’s service on the Directorate shall terminate on the date such member leaves such office; and

(B) the successor to the office of such member shall serve the remainder of such member’s term.

(4) Equal representation of banks

(5) Chairperson

(6) Staff

(A) No paid employees

(B) Powers

(7) Administrative expenses

(A) In general

(B) Pro rata distributionThe amount each Federal Home Loan Bank shall pay under subparagraph (A) shall be determined by the Thrift Depositor Protection Oversight Board by multiplying the total administrative expenses for any period by the percentage arrived at by dividing—

(i) the aggregate amount the Thrift Depositor Protection Oversight Board required such bank to invest in the Funding Corporation (as of the time of such determination) under paragraphs (4) and (5) of subsection (e) (computed without regard to paragraphs (3) or (6) of such subsection); by

(ii) the aggregate amount the Thrift Depositor Protection Oversight Board required all Federal Home Loan Banks to invest (as of the time of such determination) under such paragraphs.

(8) Regulation by Thrift Depositor Protection Oversight Board

(9) No compensation from Funding Corporation

(d) Powers of Funding CorporationThe Funding Corporation shall have only the powers described in paragraphs (1) through (9), subject to the other provisions of this section and such regulations, orders, and directions as the Thrift Depositor Protection Oversight Board may prescribe:

(1) Issue stock

(2) Purchase capital stock; transfer amounts

(3) Issue obligations

(4) Impose assessments

(5) Corporate seal

(6) Succession

(7) Contracts

(8) Authority to sue

(9) Incidental powers

(e) Capitalization of Funding Corporation, etc.

(1) In general

(A) Amount requiredThe Thrift Depositor Protection Oversight Board shall ensure that the aggregate of the amounts obtained under this subsection shall be sufficient so that—

(i) the Funding Corporation may transfer the amounts required under paragraph (8); and

(ii) the total of the face amounts (the amount of principal payable at maturity) of noninterest bearing instruments in the Funding Corporation Principal Fund are equal to the aggregate amount of principal on the obligations of the Funding Corporation.

(B) Purchases of stock by Federal Home Loan Banks

(2) Par value; transferability

(3) Maximum investment amount limitation for each Federal Home Loan BankThe cumulative amount of funds invested in nonvoting capital stock of the Funding Corporation by each Federal Home Loan Bank under paragraph (1) shall not at any time exceed the sum of the amounts calculated under subparagraphs (A) and (B), as adjusted in subparagraph (C), as follows:

(A) Reserves and undivided profits on December 31, 1988The sum on December 31, 1988, of—

(i) the reserves maintained by such Bank pursuant to the reserve requirement contained in the first 2 sentences of section 1436 of this title (as in effect on December 31, 1988); and

(ii) the undivided profits of such Bank, minus the amounts invested in the capital stock of the Financing Corporation pursuant to section 1441 of this title.

(B) Subsequent additions to reserves and undivided profitsThe amount, calculated until the date on which the Funding Corporation Principal Fund is fully funded, equal to—

(i) the sum of—(I) the amounts added to reserves by such Bank after December 31, 1988, pursuant to the reserve requirement contained in the first 2 sentences of section 1436 of this title (as in effect on December 31, 1988); and(II) the quarterly additions to undivided profits of the Bank after December 31, 1988; minus

(ii) the amounts invested by such Bank in the capital stock of the Financing Corporation after December 31, 1988, pursuant to the requirement contained in section 1441 of this title.

(i) Increase in limit

(ii) Decrease in limit

(4) Pro rata distribution of first $1,000,000,000 invested in Funding Corporation by Federal Home Loan Banks

(5) Pro rata distribution of amounts required to be invested in excess of $1,000,000,000Of any amount which the Thrift Depositor Protection Oversight Board may require the Federal Home Loan Banks to invest in capital stock of the Funding Corporation under this subsection in excess of the $1,000,000,000 amount referred to in paragraph (4), the amount which each Federal Home Loan Bank (or any successor to such Bank) shall invest shall be determined by the Thrift Depositor Protection Oversight Board by multiplying the excess amount by the percentage arrived at by dividing—

(A) the sum of the total assets (as of the most recent December 31) held by all Savings Association Insurance Fund members as of the date of funding which are members of such Bank; by

(B) the sum of the total assets (as of such date) held by all Savings Association Insurance Fund members as of the date of funding which are members of a Federal Home Loan Bank.

(6) Special provisions relating to maximum amount limitations

(A) In generalIf the amount of any Federal Home Loan Bank’s allocation under paragraph (5) exceeds the maximum amount applicable with respect to such Bank (in this paragraph referred to as a “deficient Bank”) under paragraph (3) at the time of such determination (in this paragraph referred to as the “excess amount”)—

(i) the Thrift Depositor Protection Oversight Board shall require each Federal Home Loan Bank that is not allocated an amount under paragraph (5) that exceeds its maximum under paragraph (3) (in this paragraph referred to as a “remaining Bank”) to purchase stock in the Funding Corporation (in addition to the amount determined under paragraph (5) for such remaining Bank and subject to the maximum amount applicable with respect to such remaining Bank under paragraph (3) at the time of such determination) on behalf of the deficient Bank the amount determined under subparagraph (B);

(ii) the Thrift Depositor Protection Oversight Board shall require the deficient Bank to subsequently reimburse the remaining Banks out of its net earnings (or reimbursements received from other Banks) in the manner described in subparagraphs (C) and (D); and

(iii) the requirements contained in subparagraph (D) relating to the use of net earnings shall apply to the deficient Bank until such Bank has reimbursed the remaining Banks for all of the excess amount.

(B) Allocation of excess amount among remaining Federal Home Loan Banks

(i) In generalThe amount of stock each remaining Federal Home Loan Bank shall be required to purchase under subparagraph (A)(i) is the amount determined by the Thrift Depositor Protection Oversight Board by multiplying the excess amount by the percentage arrived at by dividing—(I) the cumulative amount of stock in the Funding Corporation purchased under this subsection by such remaining Bank at the time of such determination; by(II) the aggregate of the cumulative amounts invested under this subsection by all remaining Banks at such time.

(ii) Reallocation

(i) In general

(ii) Determination of amounts

(D) Transfer to account for reimbursements required

(i) In general

(ii) Limitation

(f) Obligations of Funding Corporation

(1) Issuance

(2) Interest paymentsThe Funding Corporation shall pay the interest due on such obligations from funds obtained for such interest payments from the following sources:

(A) Earnings on certain assets

(B) Proceeds from Resolution Trust CorporationTo the extent the amounts available pursuant to subparagraph (A) are insufficient to cover the amount of interest payments, the Resolution Trust Corporation shall pay to the Funding Corporation—

(i) the liquidating dividends and payments made on claims received by the Resolution Trust Corporation from receiverships to the extent such proceeds are determined by the Thrift Depositor Protection Oversight Board to be in excess of funds presently necessary for resolution costs; and

(ii) any proceeds from warrants and participations acquired by the Resolution Trust Corporation.

(i) In general

(ii) Annual determination

(iii) Payment term alterations

(iv) Term beyond maturity

(v) Semiannual reports

(D) Proceeds from sale of assets

(E) Treasury backup

(i) In general

(ii) Liability of Funding Corporation

(iii) Appropriation of funds

(3) Principal payments

(4) Proceeds to be transferred to Resolution Trust CorporationSubject to terms and conditions approved by the Thrift Depositor Protection Oversight Board, the proceeds (less any discount, plus any premium, net of issuance costs) of any obligation issued by the Funding Corporation shall be used to—

(A) purchase the capital certificates issued by the Resolution Trust Corporation under section 1441a of this title; or

(B) refund any previously issued obligation the proceeds of which were transferred in the manner described in subparagraph (A).

(5) Investment of United States funds in obligations

(6) Market for obligations

(7) Tax exempt status

(A) In general

(B) Exception

(8) Obligations not exempt securities

(A) In generalFor purposes of the laws administered by the Securities and Exchange Commission, obligations of the Funding Corporation—

(i) shall not be considered to be securities issued or guaranteed by a person controlled or supervised by, or acting as an instrumentality of, the Government of the United States; and

(ii) shall not be considered to be “exempted securities” within the meaning of section 78c(a)(12)(A)(i) of title 15, except that such obligations shall be considered to be exempted securities for purposes of section 78o of title 15.

(B) Authority of Commission

(9) Minority participation in public or negotiated offerings

(10) No full faith and credit of the United States

(g) Use and disposition of assets of Funding Corporation not transferred to Resolution Trust Corporation

(1) In general

(2) Separate account for zero coupon instruments held to ensure payment of principalExcept as provided in subsection (e)(8), the Funding Corporation shall invest amounts received pursuant to subsection (e) in, and hold in a separate account to be known as the Funding Corporation Principal Fund, noninterest bearing instruments—

(A) which are direct obligations of the United States issued by the Secretary; and

(B) the total of the face amounts (the amount of principal payable at maturity) of which is approximately equal to the aggregate amount of principal on the obligations of the Funding Corporation.

(h) Miscellaneous provisions

(1) Treatment for certain purposes

(2) Federal Reserve banks as depositaries and fiscal agents

(3) Applicability of certain provisions relating to Government corporations

(4) Jurisdiction and power to remove

(A) Federal court jurisdiction

(B) Removal

(i) Annual report

(1) In general

(2) ContentsThe report required under paragraph (1) shall include—

(A) audited statements and any information necessary to make known the financial condition and operations of the Funding Corporation in accordance with generally accepted accounting principles;

(B) the financial operating plans and forecasts (including estimates of actual and future spending, and estimates of actual and future cash obligations) of the Funding Corporation taking into account its financial commitments, guarantees, and other contingent liabilities; and

(C) the results of the annual audit of the financial transactions of the Funding Corporation conducted by the Comptroller General pursuant to section 9105(a) of title 31.

(3) Submission to Congress and President

(j) Termination of Funding Corporation

(1) In general

(2) Authority of Thrift Depositor Protection Oversight Board to conclude affairs of Funding Corporation

(k) DefinitionsFor purposes of this section, the following definitions shall apply:

(1) Administrative expensesThe term “administrative expenses” does not include—

(A) any interest on, or any redemption premium with respect to, any obligation of the Funding Corporation; or

(B) issuance costs.

(2) Custodian feeThe term “custodian fee” means—

(A) any fee incurred by the Funding Corporation in connection with the transfer of any security to, or the maintenance of any security in, the segregated account established under subsection (g); and

(B) any other expense incurred by the Funding Corporation in connection with the establishment or maintenance of such account.

(3) Funding Corporation

(4) Funding Corporation Principal Fund

(5) Issuance costsThe term “issuance costs”—

(A) means issuance fees and commissions incurred by the Funding Corporation in connection with the issuance or servicing of any obligation of the Funding Corporation; and

(B) includes legal and accounting expenses, trustee and fiscal and paying agent charges, costs incurred in connection with preparing and printing offering materials, and advertising expenses, to the extent that any such cost or expense is incurred by the Funding Corporation in connection with issuing any obligation.

(6) Net earnings

(7) Thrift Depositor Protection Oversight BoardThe term “Thrift Depositor Protection Oversight Board” means—

(A) the Thrift Depositor Protection Oversight Board of the Resolution Trust Corporation under section 1441a of this title; and

(B) after the termination of the Resolution Trust Corporation—

(i) the Secretary of the Treasury;

(ii) the Chairman of the Board 2

2 See 2008 Amendment note below.

of Governors of the Federal Reserve System; and

(iii) the Secretary of Housing and Urban Development.

(8) Secretary

(9) Undivided profitsThe term “undivided profits” means earnings retained after dividends have been paid minus the sum of—

(A) that portion required to be added to reserves maintained pursuant to the first 2 sentences of section 1436 of this title; and

(B) the dollar amounts held by the respective Federal Home Loan Banks in special dividend stabilization reserves on December 31, 1985, as determined by the table set forth in section 1441(d)(7) of this title.

(l) Regulations

(July 22, 1932, ch. 522, § 21B, as added Pub. L. 101–73, title V, § 511(a), Aug. 9, 1989, 103 Stat. 394; amended Pub. L. 102–233, title III, § 302(b), Dec. 12, 1991, 105 Stat. 1767; Pub. L. 102–550, title XVI, § 1613(a)(7), (9), Oct. 28, 1992, 106 Stat. 4092; Pub. L. 104–208, div. A, title II, § 2704(d)(5), (11)(E), (F), Sept. 30, 1996, 110 Stat. 3009–488, 3009–489; Pub. L. 106–102, title VI, § 607(a), Nov. 12, 1999, 113 Stat. 1455; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 9(d)(7), (8), Feb. 15, 2006, 119 Stat. 3617; Pub. L. 110–289, div. A, title II, §§ 1204(8)–(10), (12), 1213, July 30, 2008, 122 Stat. 2786, 2791.)

§ 1442. Member financial information

(a) In general

In order to enable the Federal Home Loan Banks to carry out the provisions of this chapter, the Secretary of the Treasury, the Comptroller of the Currency, the Chairman of the Board 1

1 See 2008 Amendment note below.

of Governors of the Federal Reserve System, the Chairperson of the Federal Deposit Insurance Corporation, the Chairperson of the National Credit Union Administration, and the Director of the Office of Thrift Supervision, upon request by any Federal Home Loan Bank—

(1) shall make available in confidence to any Federal Home Loan Bank, such reports, records, or other information as may be available, relating to the condition of any member of any Federal Home Loan Bank or any institution with respect to which any such Bank has had or contemplates having transactions under this chapter; and

(2) may perform through their examiners or other employees or agents, for the confidential use of the Federal Home Loan Bank, examinations of institutions for which such agency is the appropriate Federal banking regulatory agency.

In addition, the Comptroller of the Currency, the Chairman of the Board 1 of Governors of the Federal Reserve System, the Chairperson of the National Credit Union Administration, and the Director of the Office of Thrift Supervision shall make available to the Director or any Federal Home Loan Bank the financial reports filed by members of any Bank to enable the Director or a Bank to compile and publish cost of funds indices or other financial or statistical reports.

(b) Consent by members

Every member of a Federal Home Loan Bank shall, as a condition precedent thereto, be deemed—

(1) to consent to such examinations as the Bank or the Director may require for the purposes of this chapter;

(2) to agree that reports of examinations by local, State, or Federal agencies or institutions may be furnished by such authorities to the Bank or the Director upon request; and

(3) to agree to give the Bank or the Federal agency, upon request, such information as they may need to compile and publish cost of funds indices and to publish other reports or statistical summaries pertaining to the activities of Bank members.

(July 22, 1932, ch. 522, § 22, 47 Stat. 739; Pub. L. 101–73, title VII, § 719, Aug. 9, 1989, 103 Stat. 422; Pub. L. 110–289, div. A, title II, § 1204(8), July 30, 2008, 122 Stat. 2786.)

§ 1442a. Repealed. Pub. L. 106–102, title VI, § 606(c), Nov. 12, 1999, 113 Stat. 1454

§ 1443. Forms of bank stock and obligations

Any stock, debentures, bonds, notes, or other obligations issued under the authority of this chapter may be issued in uncertificated form, utilizing a book entry method, or in certificated form under such rules, regulations, or guidelines as the Director 1

1 See 2008 Amendment note below.

may provide.

(July 22, 1932, ch. 522, § 23, 47 Stat. 739; Pub. L. 101–73, title VII, § 717, Aug. 9, 1989, 103 Stat. 422; Pub. L. 110–289, div. A, title II, § 1204(8), (12), July 30, 2008, 122 Stat. 2786.)

§ 1444. Eligibility to membership in banks

(a) Any organization organized under the laws of any State and subject to inspection and regulation under the banking or similar laws of such State shall be eligible to become a member under this chapter 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.

(b) In all respects, but subject to such additional rules and regulations as the Director may provide, any such organization shall be a member for the purposes of this chapter.

(July 22, 1932, ch. 522, § 24, 47 Stat. 739; Pub. L. 101–73, title VII, § 701(b)(1), (3)(A), Aug. 9, 1989, 103 Stat. 412; Pub. L. 110–289, div. A, title II, § 1204(8), July 30, 2008, 122 Stat. 2786.)

§ 1445. Succession of Federal Home Loan Banks

Each Federal Home Loan Bank shall have succession until dissolved by the Director under this chapter or by further act of Congress.

(July 22, 1932, ch. 522, § 25, 47 Stat. 740; Pub. L. 101–73, title VII, § 701(b)(1), (3)(A), Aug. 9, 1989, 103 Stat. 412; Pub. L. 110–289, div. A, title II, § 1204(8), July 30, 2008, 122 Stat. 2786.)

§ 1446. Liquidation or reorganization; acquisition of assets by other banks; assumption of liabilities

(a) In general

(b) Voluntary mergers authorized

(1) In general

(2) Regulations required

(July 22, 1932, ch. 522, § 26, 47 Stat. 740; Pub. L. 101–73, title VII, § 701(b)(1), (3)(A), Aug. 9, 1989, 103 Stat. 412; Pub. L. 110–289, div. A, title II, §§ 1204(8), 1209, 1214, July 30, 2008, 122 Stat. 2786, 2789, 2791.)

§ 1447. Repealed. Pub. L. 106–102, title VI, § 606(c), Nov. 12, 1999, 113 Stat. 1454

§ 1448. Effect of partial invalidity of chapter

If any provision of this chapter, or the application thereof to any person or circumstances, is held invalid, the remainder of the chapter, and the application of such provision to other persons or circumstances, shall not be affected thereby.

(July 22, 1932, ch. 522, § 28, 47 Stat. 740.)

§ 1449. Reservation of right to amend or repeal chapter

The right to alter, amend, or repeal this chapter is expressly reserved.

(July 22, 1932, ch. 522, § 30, 47 Stat. 741.)