§321 Application for membership

Summary

Most kinds of banks set up by a state, under the District of Columbia code, or under general state or federal law — including Morris Plan and similar banks — may apply to the Board of Governors of the Federal Reserve to buy stock in the Federal Reserve Bank for their district. The Board sets the rules for the application. Each bank must subscribe for the same amount of stock a national bank would have to buy. For membership, a bank’s "capital" also counts any outstanding capital notes and debentures it issued that were bought by the Reconstruction Finance Corporation. The Board can admit the bank as a Federal Reserve stockholder if it follows this chapter and any conditions the Board sets. If a national bank becomes a state bank, or merges with a nonmember state bank, the new or continuing state bank can be admitted under these rules; otherwise the national bank’s Federal Reserve stock will be canceled and paid under section 287. If a national bank merges with a state bank that is already a member under a state charter, that state bank keeps its membership. A state bank that on February 25, 1927 lawfully had branches may keep and operate them while it is or becomes a Federal Reserve stockholder, but a state bank cannot keep or get Federal Reserve stock if it has branches opened after February 25, 1927 outside the city, town, or village of its main office. State member banks may open branches in the United States, its possessions, or foreign countries on the same terms as national banks, but they must get approval from the Board of Governors (not the Comptroller) before opening or keeping such branches.