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surance: The amount of each policy, the § 2.3 Statutory requirements to be comrate and premium, date of commence

plied with by national bank desiring ment, term, and date of expiration, as to act as broker or agent in making well as a description of property insured, or procuring loans on real estate. with name of assured and to whom loss

(a) The bank must be located in a is payable. As to life insurance: Amount

place the population of which does not and date of policy, with premium, and a

exceed 5,000 as shown by the last precedstatement as to under what form the

ing decennial census. insurance is written, giving also name of

(b) The real estate by which the loans assured and beneficiary. As to any and

negotiated are secured must be located all other forms of insurance: The fullest

within 100 miles of the place in which possible particulars as to amounts, dates,

the negotiating bank is located. rate, premiums, and what is insured by

(c) The bank may receive for such the policy, and of collection of all pre

services a reasonable fee or commission. miums collected for account of the com

(d) The bank shall in no case guarpany, refunds made, the proportion of

antee either the principal or interest of premium credited to the profits of the

any such loans. bank under its agreement with the com

(e) The powers conferred are to be pany, the proportion due the company,

exercised under such regulations as may the amounts and dates of all remittances

be prescribed by the Comptroller of the made to the insurance company on ac

Currency. count of premiums collected, and the balance, if any, due from the bank to the § 2.4 Regulations for national bank act. insurance company.

ing as broker or agent in making or

procuring loans on real estate. (e) The bank will be required to carry on its general ledger an account which

(a) A bank intending to avail itself of will, at all times, show the amount due to

this provision of the law must adopt by insurance companies for which it is act

its board of directors a resolution in the ing as agent, on account of premiums

following form: collected but not remitted, and this li- Be is resolved, That the officers of the ability must be shown in reports of con

National Bank of dition and in the published statements

are hereby authorized and empowered on of the bank under the heading “other

behalf of this bank, as broker or agent, to liabilities on account of insurance pre

accept from customers of this bank deposits

of funds to be invested for account of said miums collected and not remitted,” un

customers, in loans secured by real estate, less specifically provided for in the

and to procure, as broker or agent, for cusreport.

tomers of this bank loans which shall be (f) The bank should also keep such secured by real estate, under the provisions records as may be required by each in- of the act approved September 7, 1916; Prosurance company in the manner and un

vided, That the investment of such funds der the forms prescribed by the various

as stated, and all such procuring of loans or

lending of funds for clients shall be undercompanies; all of which should be avail

taken only under written instructions from able for inspection by the Examiner on the customer for whom this bank, through request.

its officers, may act as broker or agent, such (g) The agent bank must not assume written instructions in each case to be first any responsibility or liability for either delivered to an oficer of this bank. Such the adjustment, settlement, or payment

instructions shall, in all cases, state clearly of losses under any policy issued by or

that the bank in acting as broker or agent through its agency.

in no way guarantees payment of either the

principal or interest of any loan so nego(h) The records of all profits derived tiated. from the insurance agency should be

(b) A certified copy of such resolucarried in a separate account on the

tion, attested by the president or vice books of the bank, and the records

president and cashier and by a majority should be so kept as to enable the Exam

of the directors of the bank, must be iner readily to trace to the source all

forwarded to this office, on forms to be items of profit derived in this connection.

furnished by this ofice. (Regs., Dec. 1, 1916, as amended at 22 F.R. (c) No bank snall charge more than 10075, Dec. 17, 1957)

one commission or brokerage on the

making of any loan; that is to say, if it (h) No bank shall advance or use its shall charge a brokerage or commission own funds in connection with real esto the party borrowing the money, it tate loans negotiated as broker or agent. shall not charge a brokerage or commis- (1) No loans secured by real estate, sion to the party to whom money is so which the bank has negotiated as broker loaned, and vice versa.

or agent, should become a part of the (d) Each bank acting under th pro- assets of the bank even temporarily, unvision of law will be required to keep for less such loans conform to the provisions a period of five years a record showing of section 24 of the Federal Reserve Act as to each loan negotiated by the bank: (38 Stat. 273; 12 U.S.C. 371) as

(1) The name and address of the amended. principal for whom the bank is acting, (j) There should be available in the

(2) Date of written instructions from bank for inspection by the National the principal,

Bank Examiner: (3) Name and address of maker of (1) An authoritative statement shownote,

ing the population of the town accord(4) Date of note,

ing to the last preceding decennial cen(5) Date of maturity of note,

sus. (6) Brief description of property se- (2) All records pertaining to the necuring note, showing location and dis- gotiation of real estate loans as broker tance from place in which bank is lo- or agent. cated,

(Reg., Dec. 1, 1916, as amended at 22 F.R. (7) Character of improvements, etc., 10075, Dec. 17, 1957)

(8) Name and address of party to whom note was transferred or delivered

§ 2.5 Application forms to be executed by the bank,

by applicants when national bank (9) Date of such transfer or delivery,

acts as broker for the placing of

loans. (10) Amount of principal of note, (11) Rate of interest or discount,

(a) These applications should show: (12) Rate of commission or broker- (1) Location of property. age charged by bank for acting as broker (2) Acreage. or agent, and

(3) Assessed valuation. (13) Amount of such commission or (4) Estimated present value. brokerage, and whether said commission (5) Brief descriptions of buildings was paid by borrower of the money or

thereon, and estimated value of them. by the party for whom it was loaned.

(6) Whether buildings are insured, (e) A book should be kept showing the and, if so, for what amounts and in what date on which each mortgage or deed companies. of trust negotiated by the bank has been (7) Whether property is already enadmitted to record, the court in which cumbered, and, if so, for what amount. the same is recorded, and the recorda- (8) If property is farm property tion fees paid in each case.

applicant should state whether or not (f) The records of all profits derived the dwelling is provided with sanitary from acting as broker or agent in ne- arrangements approved by the local gotiating loans on real estate should be board of health, and, if not, what sanicarried in a separate account on the tary arrangements there are. books of the bank, and the records should (b) At the foot of this application be so kept as to enable the Examiner should be printed below the signature readily to trace to the source all items of the applicant a statement to the efof profit derived in this connection. fect that “The statements in the forego

(g) Deposits of money received by the ing application have been submitted to bank as broker or agent to be invested this bank by the applicant for the loan, in loans secured by real estate as pre

but this bank does not undertake to scribed by law, must be treated as trust guarantee the correctness of any of the funds and kept separate and apart from statements made by the applicant." the other assets of the bank. Such funds (c) If any applicant for a loan makes must in no case be permitted to pass statements in his application which any from the possession of the bank until officers of the bank before whom the the loan for which they are to be paid application may come may have reason out is formally accepted by or in behalf to think are not correct, the attention of of the party for whose account nego- the applicant should be called to the tiated.

possible discrepancy.

PART 3-NATIONAL BANK LOANS

SECURED OR COVERED BY GOV.

ERNMENTAL GUARANTIES $ 3.1 Definition of terms.

(a) The requirement of exception 10 (R.S. 5200, 12 U.S.C. 84(10)) that a guaranty or a commitment or agreement to take over or to purchase, referred to collectively herein as "agreement,” must be unconditional means that the protection afforded to the bank thereby against loss resulting from factors beyond its control, must not be substantially diminished or impaired. This protection is not materially diminished or impaired by procedural requirements (for example, requirement that notification of a default be given by the lender to the guarantor within 20 days of its occurrence, even though demand for payment under the guaranty cannot be made until after the expiration of 90 days) or by requirements of good faith on the part of the bank. Such requirements, therefore, would not prevent an agreement from being unconditional for the purposes of this statute.

(b) An agreement is not unconditional within the meaning of exception 10 if liability thereunder (1) is contingent upon the happening of an event or a condition precedent not within the control of the bank, or (2) is subject to defeasance by a contingency or a condition subsequent not within the control of the bank.

(c) An agreement may be unconditional even though it is to take over a loan only in the event of default. The requirement of the exception that the agreement must be unconditional and must be performed by payment in cash within sixty days after demand does not imply that there must be a right to demand performance prior to default. (R.S. 5200; 12 U.S.C. 84(10)) (29 F.R. 14981, Nov. 5, 1964)

99-127 0-69-6

PART 4-DESCRIPTION OF OFFICE,

PROCEDURES, PUBLIC INFORMA-
TION 1

4.5

Sec. 4.1 Authority. 4.1a Central and field organization; delega

tions. 4.1b Regulations. 4.2 Organization of national bank. 4.3 Conversion of state bank into national

bank. 4.4 Merger, consolidation, purchase, and

assumption. Establishment of branch banks and

seasonal agencies. 4.6 Change of location of main or branch

office. 4.7 Change of bank name. 4.8 Conversion national bank into state

bank. 4.9

Voluntary liquidation. 4.10 Receivership and conservatorship. 4.11 Supervision of bank operations. 4.12 Rules of general application. 4.13 Forms and instructions. 4.14 Publications available to public. 4.15 Orders, opinions, etc. available to

public. 4.16 Other documents available to public;

exceptions. 4.17 Obtaining access to public documents. 4.18 Other rules of disclosure. 4.19 Testimony and production of docu

ments in court. AUTHORITY: The provisions of this Part 4 issued under 12 U.S.C. 1 et seq., 5 U.S.C. 552, unless otherwise noted.

SOURCE: The provisions of this Part 4 appear at 29 F.R. 7413, June 9, 1964, unless otherwise noted.

(2) First Deputy Comptroller. The First Deputy Comptroller of the Currency performs such duties as the Comptroller prescribes, including general supervision of all matters pertaining to all National Bank Regions. He is aided by an Assistant Chief National Bank Examiner. During a vacancy in the Office of the Comptroller or during the absence or disability of the Comptroller, he possesses the powers and performs the duties of the Comptroller.

(3) Administrative Assistant. The Administrative Assistant to the Comptroller performs such duties as the Comptroller prescribes, including general supervision of all internal administrative matters.

(4) Chief Counsel. The Chief Counsel is in charge of the Law Department. He advises and assists the Comptroller with respect to all legal matters concerning the functions, activities, and operations of the Office of Comptroller and all national banks.

(5) Deputies Comptroller. Two Deputies Comptroller of the Currency perform such duties as the Comptroller prescribes, including general supervision of all matters pertaining to the National Bank Regions for which each is responsible. Each such Deputy is aided by an Assistant Chief National Bank Examiner.

(6) Chief National Bank Examiner. The Chief National Bank Examiner performs such duties as the Comptroller prescribes, including general supervision of all examining personnel and of all matters pertaining to the National Bank Regions for which he is responsible. He is aided by an Assistant Chief National Bank Examiner.

(7) Deputy Comptroller (Economics). The Deputy Comptroller for Economics performs such duties relating to matters of economic studies as the Comptroller prescribes, including supervision of the Department of Banking and Economic Research and the Division of Statistics and Data Processing.

(8) Deputy Comptroller (Mergers and Branches). The Deputy Comptroller for Mergers and Branches performs such duties relating to branches, mergers, and other matters pertaining to the structure of the national banking system as the Comptroller prescribes.

§ 4.1 Authority.

This part is issued under the authority of the national banking laws (12 U.S.C., 1 et seq.). Portions of this part are issued pursuant to the provisions of the Administrative Procedure Act (5 U.S.C. 552). (32 F.R. 9513, July 1, 1967) § 4.la

Central and field organization; delegations. (a) Central office-(1) Comptroller. The Comptroller of the Currency is the head of the Office of Comptroller of the Currency. He is appointed by the President, by and with the advice and consent of the Senate, for a term of 5 years. His office is in the Treasury Department, 15th Street and Pennsylvania Avenue NW., Washington, D.C. 20220. He is assisted by the following officials who are responsible to him.

132 F.R. 9513, July 1, 1967.

(9) Deputy Comptroller (Trusts). The Deputy Comptroller for Trusts performs such duties as the Comptroller prescribes, including supervision of the Trust Division and all trust examiners.

(10) Deputy Comptroller (F.D.I.C. Affairs). The Deputy Comptroller for F.D.I.C. Affairs performs such duties relating to the Federal Deposit Insurance Corporation as the Comptroller prescribes.

(11) Special Assistant (Congressional · Affairs). The Special Assistant for Congressional Affairs performs such duties relating to Congressional liaison as the Comptroller prescribes.

(12) Special Assistant (Public Affairs). The Special Assistant for Public Affairs performs such duties relating to press and similar matters as the Comptroller prescribes.

(13) Special Assistant. The Special Assistant to the Comptroller performs such duties as the Comptroller prescribes.

(14) Bank Organization Director. The Director, Bank Organization Division, has supervision over the Bank Organization Division.

(15) International Director. The Director, International Division, has supervision over the International Division and all national bank examinersinternational.

(16) Law Department. The Law Department handles all legal matters in the Office of Comptroller, including interpretation of national banking laws, related statutes and proposed legislation, implementation and development of regulations and rulings applicable to operations of national banks, corporate organization of national banks, branching, mergers, capital changes, and other matters of national bank corporate functions. Generally, it assists the Department of Justice in litigation involving the Comptroller's Office. It, however, represents the Comptroller in bank merger litigation. The Chief Counsel is aided by

a Deputy Chief Counsel and five Associate Chief Counsels.

(17) Research Department. The Department of Banking and Economic Research studies various banking problems and reports its findings to the Comptroller. It publishes the National Banking Review and, from time to time, monographs and books dealing with banking and monetary subjects.

(18) Organization Division. The Bank Organization Division processes applications for national bank charters, branches, mergers, consolidations, purchases of assets and assumption of liabilities, resulting in national banks, and capital changes. The Director is aided by an Assistant Director, Bank Organization Division, who is responsible for merger, consolidation, and purchase and assumption matters. The Division also has a New Bank Section, a Branch Section, and a Capital Increase Section.

(19) International Division. The International Division is responsible for the examination of national bank branch offices located overseas.

(20) Trust Division. The Trust Division is responsible for supervision and examination of trust departments of national banks. It processes applications for fiduciary powers and monitors common trust funds of state and national banks. The Deputy Comptroller for Trusts is aided by a Chief Representative in Trusts.

(21) Administrative Activities. The administrative activities of the Office of Comptroller of the Currency are under the charge of the Administrative Assistant to the Comptroller. He is aided by a Deputy Administrative Assistant (Fiscal Management) and a Deputy Administrative Assistant (Personnel).

(b) Field offices. (1) Fourteen National Bank Regions cover the United States and the Virgin Islands. The office address of and the geographic area covered by each is as follows:

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