PRIA, Government Policy, Made Personal

Summary

Requires the Corporation to keep a minimum amount of core capital. Under the regular rule, that minimum is 2.75% of its total on-balance-sheet assets plus 0.75% of its off-balance-sheet obligations. Off-balance items include unpaid principal on guaranteed securities backed by pools of qualified loans, similar guaranteed instruments, and other off-balance commitments. Transitional rules change the percentages for certain dates. Before January 1, 1997: 0.45% of off-balance obligations, 0.45% of “designated” on-balance assets, and 2.50% of other on-balance assets. For the year ending December 31, 1997: 0.55% off-balance, 1.20% designated, 2.55% other. For the year ending December 31, 1998: if core capital was at least $25,000,000 on January 1, 1998 then 0.65% off-balance, 1.95% designated, 2.65% other; otherwise use the regular rule. From January 1, 1999 onward, use the regular rule. Designated on-balance assets: assets acquired under section 2279aa–6(d) and qualified loans bought and held under section 2279aa–3(c)(13).

Title 12, §2279bb–2

Banks and Banking, Source: USLM XML via OLRC

(a)Except as provided in subsection (b), for purposes of this part, the minimum capital level for the Corporation shall be an amount of core capital equal to the sum of

(1)2.75 percent of the aggregate on-balance sheet assets of the Corporation, as determined in accordance with generally accepted accounting principles; and

(2)0.75 percent of the aggregate off-balance sheet obligations of the Corporation, which, for the purposes of this part, shall include

(A)the unpaid principal balance of outstanding securities that are guaranteed by the Corporation and backed by pools of qualified loans;

(B)instruments that are issued or guaranteed by the Corporation and are substantially equivalent to instruments described in subparagraph (A); and

(C)other off-balance sheet obligations of the Corporation.

(b)(1)For purposes of this part, the minimum capital level for the Corporation—

(A)prior to January 1, 1997, shall be the amount of core capital equal to the sum of—

(i)0.45 percent of aggregate off-balance sheet obligations of the Corporation;

(ii)0.45 percent of designated on-balance sheet assets of the Corporation, as determined under paragraph (2); and

(iii)2.50 percent of on-balance sheet assets of the Corporation other than assets designated under paragraph (2);

(B)during the 1-year period ending December 31, 1997, shall be the amount of core capital equal to the sum of—

(i)0.55 percent of aggregate off-balance sheet obligations of the Corporation;

(ii)1.20 percent of designated on-balance sheet assets of the Corporation, as determined under paragraph (2); and

(iii)2.55 percent of on-balance sheet assets of the Corporation other than assets designated under paragraph (2);

(C)during the 1-year period ending December 31, 1998, shall be the amount of core capital equal to—

(i)if the Corporation’s core capital is not less than $25,000,000 on January 1, 1998, the sum of—

(I)0.65 percent of aggregate off-balance sheet obligations of the Corporation;

(II)1.95 percent of designated on-balance sheet assets of the Corporation, as determined under paragraph (2); and

(III)2.65 percent of on-balance sheet assets of the Corporation other than assets designated under paragraph (2); or

(ii)if the Corporation’s core capital is less than $25,000,000 on January 1, 1998, the amount determined under subsection (a); and

(D)on and after January 1, 1999, shall be the amount determined under subsection (a).

(2)For purposes of this subsection, the designated on-balance sheet assets of the Corporation shall be—

(A)the aggregate on-balance sheet assets of the Corporation acquired under section 2279aa–6(d) of this title; and

(B)the aggregate amount of qualified loans purchased and held by the Corporation under section 2279aa–3(c)(13) of this title.

Notes & Related Subsidiaries

Editorial Notes

Amendments

2018—Subsec. (b)(2)(A). Pub. L. 115–334 substituted “section 2279aa–6(d)” for “section 2279aa–6(e)”. 1996—Pub. L. 104–105 amended section generally, substituting present provisions for provisions relating to minimum capital level, including general provisions, provisions relating to 18-month transition, and provisions relating to linked portfolio assets.

§2279bb–2 Minimum Capital Level

Summary

Title 12, §2279bb–2

Notes & Related Subsidiaries

Editorial Notes

Amendments

Citations & Metadata