use to be made from time to time examinations of States of the United States and the regulations and verning conditions under which institutions of the !subscribers of banks hereunder are permitted to be s, or relating to the conveying or recording of land id other rights, or to the enforcement of the rights of a lands securnig loans, or otherwise. If any such te, in the opinion of the board, that under the laws of regulations or procedure thereunder there would be a Federal home loan bank in making or collecting the board may withhold the establishment or prevent any Federal home-loan bank in such State until satisw, regulation, or procedure shall be established. In xamination of members is deemed inadequate for the home loan banks, the board shall establish such inspecost of which may be considered as part of the cost of Ich State. The banks and/or the board may make e and other property values methods of appraisals, and hey may deem useful for the general guidance of their and those of subscribers.

ELIGIBILITY TO SECURE ADVANCES

in a Federal home loan bank shall become eligible rom such bank upon the granting of an application for such advances. Such application shall be in such form the Federal home loan bank with the approval of the home loan bank may at its discretion deny any such to the approval of the board, may grant it on such al home loan bank may prescribe.

ADVANCES TO MEMBERS

leral home loan bank is authorized to make advances ecome eligible to apply therefor, as provided in section f home mortgages, such advances to be made subject strictions, and limitations as the board may prescribe. I be subject to the following limitations as to amounthome mortgage given in respect of an amortized home was for an original term of eight years or more, the amount not in excess of 60 per centum of the unpaid mortgage loan;

home mortgage given in respect of any other home vance shall not be for an amount in excess of 50 per rincipal of the home mortgage loan;

1 the amount of the advance exceed 40 per centum of n of the real estate securing the home mortgage loan. gage shall be accepted as collateral security for an home loan bank if, at the time such advance is made e loan secured by it has more than twenty years to run ne principal sum of the home mortgage loan secured by s of the appraised valuation of the real estate securing is amortized, or exceeds 60 per centum of the appraised estate securing such loan if such loan is not amortized; ncipal of such home-mortgage loan exceeds $15,000. For ubsection and subsection (a) the appraised valuation of tablished by such certification by the borrowing member e as the board may require. For the purposes of this home loan bank shall have power to make, or to cause e, such appraisals and other investigations as it may home mortgage otherwise eligible to be accepted as coladvance by a Federal home loan bank shall be accepted , employee, attorney, or agent of the Federal home loan owing member is personally liable thereon, unless the approved such acceptance.

shall be made upon the note or obligation of the member r provided, bearing such rate of interest as the board

may approve or determine, and the Federal home loan bank shall have a lien upon and shall hold the stock of such member as further collateral security for all indebtedness of the member to the Federal home loan bank. At no time shall the aggregate outstanding advances made by any Federal home loan bank to any member exceed twelve times the amounts paid in by such member for capital stock subscribed for by it.

(d) The applying subscriber shall enter into a primary and unconditional obligation to pay off all advances, together with interest and any unpaid costs and expenses in connection therewith according to the terms under which they were made, in such form as shall meet the requirements of the bank and the approval of the board. The bank shall reserve the right to require at any time. when deemed necessary for its protection, deposits of additional collateral security or substitutions of security by the member, and each member shall assign additional or substituted security when and as so required. Subject to the approval of the board, any Federal home loan bank shall have power to sell to any other Federal home loan bank, with or without recourse, any advance made under the provisions of this act, or to allow to such bank a participation therein, and any other Federal home loan bank shall have power to purchase such advance or to accept a participation therein, together with an appropriate assignment of security therefor, including a proportionate part of any proceeds of the retirement of capital stock of the selling bank subscribed for by the member to which such advances were made.

GENERAL POWERS AND DUTIES OF BANKS

SEC. 9. (a) Each Federal home loan bank shall have power, subject to the approval of the board, (1) to borrow money, to give security therefor, and to pay interest thereon, and (2) to issue bonds and debentures having such maturities as may be determined by the board, secured by the deposit of home mortgages.

(b) The board shall prescribe rules and regulations governing the assignment, deposit, custody, substitution, and release of home mortgages securing such bonds and debentures, the forms and terms of such bonds and debentures, and the conditions under which they may be issued and retired, including any option with respect to payment and retirement thereof in advance of maturity, and such regulations shall provide for the deposit in trust, under such terms and conditions as it may deem advisable, of the home mortgages securing such bonds and debentures.

(c) Such deposits in trust shall be so maintained that the aggregate unpaid principal of the home mortgage loans secured by the home mortgages deposited as security for any issue of bonds or debentures shall, as nearly as possible, be at all times not less than an amount equal to 190 per centum of the total outstanding amount of such issue, Cash deposited under authority of subsection (d) shall be included in the computation of the aggregate unpaid principal of home mortgage loans under this subsetion.

(d) The board may at any time require any Federal home loan bank to deposit additional home mortgages or to make substitutions of home mortgages to secure such bonds and debentures, except that when in the opinion of the board home mortgages are not available for such purpose, it may permit, for such limited periods as it may deem advisable, the deposit of cash in lieu of the deposit of substitute or additional home loan mortgages.

(e) The board shall approve or determine the rates of interest to be paid by the Federal home loan banks upon the notes, debentures, or bonds which it may issue except that no bond or debenture issued within seven years after the enactment of this act shall bear a rate of interest in excess of 51% per centum per annum, and no bond or debenture issued thereafter shall bear a rate of interest in excess of 5 per centum per annum and shail provide such margins between interest rates received upon advances made to members and interest paid upon obligations which the Federal home loan bank may issue as will cover expenses of operation and reserves and, under such regulations as may be provided by the board, some part of such reserve may be devoted to retirement of the stock subscribed by the United States.

(f) The Federal Home Loan Banks shall be jointly and severally liable for the payment when due of all bonds and debentures, and of notes and other obligations issued by any Federal Home Loan Bank, and interest thereon, in accordance with their terms: Provided, That this shall not prevent any par

an Bank, when specifically so authorized by the board, emporarily under the terms of obligations which shall nce in such manner as shall be approved by the board or is confined to the issuing bank. The Federal Home time to time in accordance with rules, regulations, and e adequate agreements and arrangements among themayment of the bonds, debentures, notes, or other obligajointly and severally liable, and the interest thereon, id arrangements shall not restrict in any respect the ty herein established.

>me Loan Bank shall have power to accept only such by members of such bank, or by other Federal Home posits shall not be subject to check, and no rate of er centum per annum shall be paid thereon. No Federal transact any banking or other business not expressly

horized and empowered to permit, or, whenever in the ur members of the board an emergency exists requiring Federal Home Loan Banks to rediscount the discounted by other Federal Home Loan Banks, or to purchase the er Federal Home Loan Bank, or to make deposits with an Banks. In any case in which the board requires the board shall fix the price therefor, or requires the acceptall fix the security therefor. The rediscount rates and be paid upon deposits shall be fixed by the board. >me Loan Bank shall at all times have an amount equal outstanding capital subscriptions of its members, plus e current deposits received from its members, invested Government securities, (2) interest-bearing deposits in es, and (3) advances with maturity not greater than one s, upon such terms and conditions as the board may

e assets of each Federal Home Loan Bank (except re› provided for in subsection (i)) as such bank may deem y be invested otherwise than in advances to members. I be made subject to such regulations, restrictions, and prescribed by the board.

ORATIONS OF BANKS, AND CORPORATE POWERS

rs of each Federal Home Loan Bank shall, in accordance regulations as the board may prescribe, make and file earliest practicable date after the establishment of such certificate which shall contain such information as the pon the making and filing of such organization certificate ank shall become, as of the date of the execution of its e, a body corporate, and as such and in its name as d it shall have power to adopt, alter, and use a corporate s; to purchase or lease and hold or dispose of such real essary or convenient for the transaction of its business; o complain, and to defend, in any court of competent Federal; to select, employ, and fix the compensation of es, attorneys, and agents as shall be necessary for the ness, subject to the approval of the board; to define their of them and fix the penalties thereof, and to dismiss at employees, attorneys, and agents; and, by its board of - amend, and repeal by-laws, rules, and regulations govwhich its affairs may be administered; and the powers may be exercised and enjoyed subject to the approval of lent of a Federal home loan bank may also be a member ors thereof, but no other officer, employee, attorney, or who receives compensation, may be a member of the ach such bank shall have all such incidental powers, not provisions of this act, as are customary and usual in

may approve or determine, and the Federal home loan bank shall have a lien upon and shall hold the stock of such member as further collateral security for all indebtedness of the member to the Federal home loan bank. At no time shall the aggregate outstanding advances made by any Federal home loan bank to any member exceed twelve times the amounts paid in by such member for capital stock subscribed for by it.

(d) The applying subscriber shall enter into a primary and unconditional obligation to pay off all advances, together with interest and any unpaid costs and expenses in connection therewith according to the terms under which they were made, in such form as shall meet the requirements of the bank and the approval of the board. The bank shall reserve the right to require at any time, when deemed necessary for its protection, deposits of additional collateral security or substitutions of security by the member, and each member shall assign additional or substituted security when and as so required. Subject to the approval of the board, any Federal home loan bank shall have power to sell to any other Federal home loan bank, with or without recourse, any advance made under the provisions of this act, or to allow to such bank a participation therein, and any other Federal home loan bank shall have power to purcha«e such advance or to accept a participation therein, together with an appropriate assignment of security therefor, including a proportionate part of any proceeds of the retirement of capital stock of the selling bank subscribed for by the member to which such advances were made.

GENERAL POWERS AND DUTIES OF BANKS

SEC. 9. (a) Each Federal home loan bank shall have power, subject to the approval of the board, (1) to borrow money, to give security therefor, and to pay interest thereon, and (2) to issue bonds and debentures having such maturities as may be determined by the board, secured by the deposit of home mortgages.

(b) The board shall prescribe rules and regulations governing the assignment, deposit, custody, substitution, and release of home mortgages securing such bonds and debentures, the forms and terms of such bonds and debentures, and the conditions under which they may be issued and retired, including any option with respect to payment and retirement thereof in advance of maturity, and such regulations shall provide for the deposit in trust, under such terms and conditions as it may deem advisable, of the home mortgages securing such bonds and debentures.

(c) Such deposits in trust shall be so maintained that the aggregate unpaid principal of the home mortgage loans secured by the home mortgages deposited as security for any issue of bonds or debentures shall, as nearly as possible, be at all times not less than an amount equal to 190 per centum of the total outstanding amount of such issue. Cash deposited under authority of subsection (d) shall be included in the computation of the aggregate unpaid principal of home mortgage loans under this subsection.

(d) The board may at any time require any Federal home loan bank to deposit additional home mortgages or to make substitutions of home mortgages to secure such bonds and debentures, except that when in the opinion of the board home mortgages are not available for such purpose, it may permit, for such limited periods as it may deem advisable, the deposit of cash in lieu of the deposit of substitute or additional home loan mortgages,

(e) The board shall approve or determine the rates of interest to be paid by the Federal home loan banks upon the notes, debentures, or bonds which it may issue except that no bond or debenture issued within seven years after the enactment of this act shall bear a rate of interest in excess of 331⁄2 per centum per annum, and no bond or debenture issued thereafter shall bear a rate of interest in excess of 5 per centum per annum and shall provide such margins between interest rates received upon advances minde to members and interest paid upon obligations which the Federal home loan bank may issue as will cover expenses of operation and reserves and, under such regulations as may be provided by the board, some part of such reserve may be devoted to retirement of the stock subscribed by the United States,

(f) The Federal Home Loan Banks shall be jointly and severally liable for the payment when due of all bonds and debentures, and of notes and other obligations issued by any Federal Home Loan Bank, and interest thereon, in accordance with their terms: Provided, That this shall not prevent any par

Bank, when specifically so authorized by the board, orarily under the terms of obligations which shall in such manner as shall be approved by the board confined to the issuing bank. The Federal Home to time in accordance with rules, regulations, and dequate agreements and arrangements among thement of the bonds, debentures, notes, or other obligaintly and severally liable, and the interest thereon, arrangements shall not restrict in any respect the herein established.

Loan Bank shall have power to accept only such members of such bank, or by other Federal Home its shall not be subject to check, and no rate of centum per annum shall be paid thereon. No Federal ansact any banking or other business not expressly

rized and empowered to permit, or, whenever in the members of the board an emergency exists requiring deral Home Loan Banks to rediscount the discounted other Federal Home Loan Banks, or to purchase the Federal Home Loan Bank, or to make deposits with Banks. In any case in which the board requires the ard shall fix the price therefor, or requires the accept1 fix the security therefor. The rediscount rates and e paid upon deposits shall be fixed by the board.

e Loan Bank shall at all times have an amount equal Outstanding capital subscriptions of its members, plus current deposits received from its members, invested overnment securities, (2) interest-bearing deposits in , and (3) advances with maturity not greater than one upon such terms and conditions as the board may

assets of each Federal Home Loan Bank (except reprovided for in subsection (i)) as such bank may deem be invested otherwise than in advances to members. be made subject to such regulations, restrictions, and rescribed by the board.

ATIONS OF BANKS, AND CORPORATE POWERS

of each Federal Home Loan Bank shall, in accordance egulations as the board may prescribe, make and file arliest practicable date after the establishment of such ertificate which shall contain such information as the on the making and filing of such organization certificate nk shall become, as of the date of the execution of its a body corporate, and as such and in its name as it shall have power to adopt, alter, and use a corporate ; to purchase or lease and hold or dispose of such real sary or convenient for the transaction of its business; complain, and to defend, in any court of competent ederal; to select, employ, and fix the compensation of , attorneys, and agents as shall be necessary for the ess, subject to the approval of the board; to define their them and fix the penalties thereof, and to dismiss at employees, attorneys, and agents; and, by its board of amend, and repeal by-laws, rules, and regulations govwhich its affairs may be administered; and the powers ay be exercised and enjoyed subject to the approval of ent of a Federal home loan bank may also be a member rs thereof, but no other officer, employee, attorney, or ho receives compensation, may be a member of the ch such bank shall have all such incidental powers, not provisions of this act, as are customary and usual in