Title 12 — Banks and BankingRelease 119-73not60
§615 Powers of Corporation
Title 12 › Chapter 6— FOREIGN BANKING › Subchapter II— ORGANIZATION OF CORPORATIONS TO DO FOREIGN BANKING › § 615
Summary
Gives corporations formed under this law the power to do many banking and financial activities when the Federal Reserve Board sets the rules. They can buy, sell, lend, borrow, and deal in many kinds of financial papers and instruments (like notes, checks, drafts, acceptances, and cable transfers). They can trade securities (including U.S. and state debt but not ordinary corporate stock except as allowed), issue letters of credit, trade coin and bullion, and issue bonds or promissory notes under Board limits. They may take deposits from outside the United States and only take U.S. deposits that are needed for foreign business. The Board can limit their total liabilities. If they take U.S. deposits, they must hold reserves the Board requires. May open branches or agencies in foreign countries, colonies, dependencies, or U.S. possessions with Board approval. With the Board’s consent, they may buy stock in other similar banks or companies that do not trade goods in the U.S. Without Board approval, no single investment may exceed 10% of the corporation’s capital and surplus, except 15% is allowed for a bank. They may not own stock in a direct competitor. They may buy stock to avoid a loss on a good-faith debt, but must sell it within six months unless the Board agrees to more time.
Full Legal Text
Title 12, §615
Banks and Banking — Source: USLM XML via OLRC
(a)To purchase, sell, discount, and negotiate, with or without its indorsement or guaranty, notes, drafts, checks, bills of exchange, acceptances, including bankers’ acceptances, cable transfers, and other evidences of indebtedness; to purchase and sell, with or without its indorsement or guaranty, securities, including the obligations of the United States or of any State thereof but not including shares of stock in any corporation except as herein provided; to accept bills or drafts drawn upon it subject to such limitations and restrictions as the Board of Governors of the Federal Reserve System may impose; to issue letters of credit; to purchase and sell coin, bullion, and exchange; to borrow and to lend money; to issue debentures, bonds, and promissory notes under such general conditions as to security and such limitations as the Board of Governors of the Federal Reserve System may prescribe; to receive deposits outside of the United States and to receive only such deposits within the United States as may be incidental to or for the purpose of carrying out transactions in foreign countries or dependencies or insular possessions of the United States; and generally to exercise such powers as are incidental to the power conferred by this Act or as may be usual, in the determination of the Board of Governors of the Federal Reserve System, in connection with the transaction of the business of banking or other financial operations in the countries, colonies, dependencies, or possessions in which it shall transact business and not inconsistent with the powers specifically granted herein. Nothing contained in this subchapter shall be construed to prohibit the Board of Governors of the Federal Reserve System, under its power to prescribe rules and regulations, from limiting the aggregate amount of liabilities of any or all classes incurred by the corporation and outstanding at any one time. Whenever a corporation organized under this subchapter receives deposits in the United States authorized by this subchapter, it shall carry reserves in such amounts as the Board of Governors of the Federal Reserve System may prescribe for member banks of the Federal Reserve System.
(b)To establish and maintain for the transaction of its business branches or agencies in foreign countries, their dependencies or colonies, and in the dependencies or insular possessions of the United States, at such places as may be approved by the Board of Governors of the Federal Reserve System and under such rules and regulations as it may prescribe, including countries or dependencies not specified in the original organization certificate.
(c)With the consent of the Board of Governors of the Federal Reserve System to purchase and hold stock or other certificates of ownership in any other corporation organized under the provisions of this subchapter, or under the laws of any foreign country or a colony or dependency thereof, or under the laws of any State, dependency, or insular possession of the United States but not engaged in the general business of buying or selling goods, wares, merchandise, or commodities in the United States, and not transacting any business in the United States except such as in the judgment of the Board of Governors of the Federal Reserve System may be incidental to its international or foreign business: Provided, however, That, except with the approval of the Board of Governors of the Federal Reserve System, no corporation organized under this subchapter shall invest in any one corporation an amount in excess of 10 per centum of its own capital and surplus, except in a corporation engaged in the business of banking, when 15 per centum of its capital and surplus may be so invested: Provided further, That no corporation organized under this subchapter shall purchase, own, or hold stock or certificates of ownership in any other corporation organized under this subchapter or under the laws of any State which is in substantial competition therewith, or which holds stock or certificates of ownership in corporations which are in substantial competition with the purchasing corporation. Nothing contained herein shall prevent corporations organized under this subchapter from purchasing and holding stock in any corporation where such purchase shall be necessary to prevent a loss upon a debt previously contracted in good faith; and stock so purchased or acquired in corporations organized under this subchapter shall, within six months from such purchase, be sold or disposed of at public or private sale, unless the time to so dispose of same is extended by the Board of Governors of the Federal Reserve System.
Legislative History
Notes & Related Subsidiaries
Editorial Notes
References in Text
Each corporation organized as provided in sections 611 to 614 of this title, referred to in first par., was in the original “Each corporation so organized”. This act, referred to in subsec. (a), is act Dec. 23, 1913, ch. 6, 38 Stat. 251, known as the Federal Reserve Act, which is classified principally to chapter 3 (§ 221 et seq.) of this title. For complete classification of this Act to the Code, see
References in Text
note set out under section 226 of this title and Tables. This subchapter, referred to in subsecs. (a) and (c), was in the original “this section”, meaning section 25A of act Dec. 23, 1913, which is classified to this subchapter (§ 611 et seq.). Organized under this subchapter, referred to in subsec. (c), was in the original “organized hereunder”, meaning under section 25A of act Dec. 23, 1913, which comprises this subchapter. Codification Section is comprised of pars. 6 and 7 (undesignated) of section 25A of act Dec. 23, 1913, which comprises this subchapter. For complete classification of section 25A of this Act, see Codification note set out under section 611 of this title.
Amendments
1978—Subsec. (a). Pub. L. 95–369, § 3(d), struck out “, but in no event having liabilities outstanding thereon at any one time exceeding ten times its capital stock and surplus” after “under such general conditions as to security and such limitations as the Board of Governors of the Federal Reserve System may prescribe”. Pub. L. 95–369, § 3(e), which directed substituting “for member banks of the Federal Reserve System” for “, but in no event less than ten per centum of its deposits,” in the third sentence, was executed by making the substitution for “, but in no event less than 10 per centum of its deposits” to reflect the probable intent of Congress.
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.
Reference
Citations & Metadata
Citation
12 U.S.C. § 615
Title 12 — Banks and Banking
Last Updated
Apr 3, 2026
Release point: 119-73not60