§358 — Title 12 Banks and Banking | U.S. Code

Summary

Federal Reserve banks can set up accounts with other Reserve banks to handle exchanges. With the Board of Governors’ permission and under its rules, a Reserve bank may open accounts or offices in other countries and hire foreign correspondents or agents to buy, sell, and collect short-term commercial bills and acceptances that come from real business deals, last no more than ninety days (not counting grace days), and carry the signatures of two or more responsible parties. The Board’s OK is also needed to open bank accounts for those foreign correspondents, for foreign banks or bankers, or for foreign states (as defined elsewhere). If one Reserve bank opens a foreign account or appoints an agent with the Board’s consent, other Reserve banks may be allowed, with the Board’s approval and under its rules, to use that same account or agent to do the same kinds of transactions.

Title 12, §358

Banks and Banking — Source: USLM XML via OLRC

Every Federal reserve bank shall have power to establish accounts with other Federal reserve banks for exchange purposes and, with the consent or upon the order and direction of the Board of Governors of the Federal Reserve System and under regulations to be prescribed by said Board, to open and maintain accounts in foreign countries, appoint correspondents, and establish agencies in such countries wheresoever it may be deemed best for the purpose of purchasing, selling, and collecting bills of exchange, and to buy and sell, with or without its indorsement, through such correspondents or agencies, bills of exchange (or acceptances) arising out of actual commercial transactions which have not more than ninety days to run, exclusive of days of grace, and which bear the signature of two or more responsible parties, and, with the consent of the Board of Governors of the Federal Reserve System, to open and maintain banking accounts for such foreign correspondents or agencies, or for foreign banks or bankers, or for foreign states as defined in section 632 of this title. Whenever any such account has been opened or agency or correspondent has been appointed by a Federal reserve bank, with the consent of or under the order and direction of the Board of Governors of the Federal Reserve System, any other Federal reserve bank may, with the consent and approval of the Board of Governors of the Federal Reserve System, be permitted to carry on or conduct, through the Federal reserve bank opening such account or appointing such agency or correspondent, any transaction authorized by this section under rules and regulations to be prescribed by the board.

Notes & Related Subsidiaries

Editorial Notes

Codification Section is comprised of subsec. (e) of section 14 of act Dec. 23, 1913. For classification to this title of remainder of section 14, see Codification note under section 353 of this title.

Amendments

1941—Act Apr. 7, 1941, inserted in first sentence “, or for foreign banks or bankers, or for foreign states as defined in section 632 of this title” after “foreign correspondents or agencies”.

Statutory Notes and Related Subsidiaries

Change of Name

section 203(a) of act Aug. 23, 1935, changed name of Federal Reserve Board to Board of Governors of the Federal Reserve System.

§358 Establishment of Accounts for Purposes of Open-market Operations; Correspondents and Agencies