Title 12 — Banks and BankingRelease 119-73not60
§329 Capital Stock Required as Condition Precedent to Membership
Title 12 › Chapter 3— FEDERAL RESERVE SYSTEM › Subchapter VIII— STATE BANKS AS MEMBERS OF SYSTEM › § 329
Summary
To join the Federal Reserve, a bank must have capital and surplus for its assets and deposits, as the Federal Reserve Board decides. Deposit banks (not trust funds) must meet national‑bank capital rules or have FDIC approval. State members may not cut capital stock without Board consent.
Full Legal Text
Title 12, §329
Banks and Banking — Source: USLM XML via OLRC
No applying bank shall be admitted to membership unless it possesses capital stock and surplus which, in the judgment of the Board of Governors of the Federal Reserve System, are adequate in relation to the character and condition of its assets and to its existing and prospective deposit liabilities and other corporate responsibilities: Provided, That no bank engaged in the business of receiving deposits other than trust funds, which does not possess capital stock and surplus in an amount equal to that which would be required for the establishment of a national banking association in the place in which it is located, shall be admitted to membership unless it is, or has been, approved for deposit insurance under the Federal Deposit Insurance Act [12 U.S.C. 1811 et seq.]. The capital stock of a State member bank shall not be reduced except with the prior consent of the Board.
Legislative History
Notes & Related Subsidiaries
Editorial Notes
References in Text
The Federal Deposit Insurance Act, referred to in text, is act Sept. 21, 1950, ch. 967, § 2, 64 Stat. 873, which is classified generally to chapter 16 (§ 1811 et seq.) of this title. For complete classification of this Act to the Code, see
Short Title
note set out under section 1811 of this title and Tables. Codification Section is comprised of the eleventh par. of section 9 of act Dec. 23, 1913, as amended. The eleventh par. constituted the ninth par. of section 9 in 1917 (40 Stat. 232), became the tenth par. in 1927 (44 Stat. 1229), and became the eleventh par. in 1950 (64 Stat. 458). For further details, see Codification note set out under section 321 of this title.
Amendments
1952—Act
July 15, 1952, vested in Board of Governors discretion with respect to admission of State banks to membership. 1933—Act
June 16, 1933, dropped alternative method of meeting the capital requirement and inserted proviso.
Reference
Citations & Metadata
Citation
12 U.S.C. § 329
Title 12 — Banks and Banking
Last Updated
Apr 3, 2026
Release point: 119-73not60