ance of subpenas, and all related activities in connection with examinations of insured institutions and affiliates thereof conducted under section 407 (m) (2) of the Act; and

(d) "Designated representative" means the person or persons empowered by the Board to conduct an investigative proceeding or a formal examination proceeding.

ន

§ 512.3 Confidentiality of proceedings. All formal examination proceedings shall be private and, unless ordered otherwise by the Board, all investigative proceedings shall also be private. Unless otherwise ordered or permitted by the Board, or required by law, and except as provided in §§ 512.4 and 512.5, the entire record of any investigative proceeding or formal examination proceeding, including the Board resolution authorizing the proceeding, the transcript of such proceeding, and all documents and information obtained by the designated representative during the course of said proceeding, shall be for the confidential use of only the Board and its staff, and no part of such record shall be made public. § 512.4 Transcripts.

Transcripts, if any, of investigative proceedings or formal examination proceedings shall be recorded solely by an official reporter or by any other person or means authorized by the designated representative. A person who has submitted documentary evidence or given testimony in an investigative proceeding or formal examination proceeding shall be entitled to procure a copy of his documentary evidence or a transcript of his own testimony on payment of the cost thereof: Provided, That, in a private proceeding, a person seeking a transcript of his own testimony shall file a written request with the Board stating the reason he desires to procure such transcript, and the Board may for good cause deny such request. In any event, any witness (or his counsel) upon proper identification, shall have the right to inspect the transcript of the witness' own testimony.

§ 512.5 Rights of witnesses.

(a) Any person who is compelled or requested to furnish documentary evidence or give testimony at an investigative proceeding or formal examination proceeding shall have the right to examine, upon request, the Board resolution authorizing such proceeding. Copies of

such resolution shall be furnished, for their retention, to such persons only with the approval of the Director or the Deputy Director of the Office of Examinations and Supervision and the concurrence therewith of the General Counsel, the Deputy General Counsel, or an Associate General Counsel of the Board.

(b) Any witness at an investigative proceeding or formal examination proceeding may be accompanied, represented, and advised by counsel, who may be present with him during any investigative proceeding or formal examination proceeding. Such counsel may advise the witness before, during, and after the taking of his testimony and may briefly question the witness, on the record, at the conclusion of his testimony, for the sole purpose of clarifying any of the answers the witness has given. During the taking of the testimony of a witness, such counsel may make summary notes solely for the use of his client. All witnesses shall be sequestered, and, unless permitted in the discretion of the designated representative, no witness or accompanying counsel may be permitted to be present during the taking of the testimony of any other witness called in such proceeding.

(c) Unless otherwise ordered by the Board, in any public investigative proceeding (but in no other proceeding under this part), if the record shall contain implications of wrongdoing by any person, such person shall have the right to appear on the record; and in addition to the rights afforded other witnesses under this part, he shall have an opportunity to cross-examine and produce rebuttal testimony and/or documentary evidence. Such person shall be granted as full an opportunity to assert his position as may be consistent with administrative efficiency and with avoidance of undue delay, in the discretion of the designated representative.

§ 512.6 Obstruction of the proceedings.

The designated representative shall report to the Board any instances where any witness or counsel has engaged in dilatory, obstructionist, or contumacious conduct or has otherwise violated any provision of this part during the course of an investigative proceeding or formal examination proceeding; and the Board may take such action as the circumstances warrant, including the exclusion of counsel from further participation in such proceeding.

§ 512.7 Subpenas.

(a) Service. Service of a subpena in connection with an investigative proceeding or formal examination proceeding shall be made upon the person named in the subpena by delivering a copy of the subpena to such person and by tendering the fees for 1 day's attendance and the mileage as specified by paragraph (c) of this section. When the subpena is issued at the instance of the Board or its staff, fees and mileage need not be tendered at the time of service. Delivery of a copy of a subpena and, when appropriate, tender of the fees to a natural person may be made by handing them to such person; or by leaving them at his office with the person in charge thereof or, if there is no one in charge, by leaving them in a conspicuous place therein; or by leaving them at his dwelling place or usual place of abode with some person of suitable age and discretion then residing therein; or by mailing them by registered or certified mail to him at his last known address; or by any method whereby actual notice is given to him and the fees are made available prior to the return date. When the person to be served is not a natural person, delivery of a copy of the subpena and tender of the fees (when appropriate) may be effected by handing them to a registered agent for service, or to any officer, director, or agent in charge of any office of such person; or by mailing them by registered or certified mail to any such representative at his last known address; or by any method whereby actual notice is given to any such representative and the fees are made available prior to the return date.

(b) Motions to quash. Any person to whom a subpena is directed may, prior to the time specified therein for compliance, but on no event more than 5 days after the date of service of such subpena, apply to the designated representative, or if he is unavailable, to the Board, to quash or modify such subpena, accompanying such application with a brief statement of the reasons therefor. The designated representative or the Board, as the case may be, may: (1) Deny the application; (2) quash or revoke the subpena; (3) modify the subpena; or (4) condition the granting of the application on such terms as the designated representative or the Board, as the case may be, determines, in his or its discretion, to be just, reasonable, and proper.

(c) Attendance of witnesses. Subpenas issued in connection with any investigative proceeding or formal examination proceeding may require the attendance and testimony of witnesses from any State or territory of the United States and the production by such witnesses of documentary or other tangible evidence at any designated place where the proceeding is being (or is to be) conducted. Witnesses summoned in any proceeding under this part shall be paid the same fees and mileage that are paid witnesses in the district courts of the United States. Witness fees and mileage shall be paid by the Board, except that whenever a person, during the course of a public investigative proceeding, calls witnesses on his own behalf as provided for by paragraph (c) of § 512.5, such person shall be responsible for the payment of fees and mileage with respect to those witnesses called by him.

of its officials who has been duly authorized by the Federal Home Loan Bank Board to act in its behalf.

§ 521.4 Creditor liabilities.

The term "creditor liabilities" means every form of obligation or debt, secured or unsecured, including deposits, investment certificates, certificates of indebtedness, and all taxes, which the member is directly obligated to pay.

§ 521.5 Deposits in banks or trust companies.

The term "deposits in banks or trust companies" includes a checking account maintained by a Federal Home Loan Bank with the Treasurer of the United States, or a deposit in another Federal Home Loan Bank.

§ 521.6 Home mortgage.

The term" home mortgage" means a mortgage upon real estate in fee simple, or on a leasehold (a) under a lease for not less than 99 years which is renewable or (b) under a lease for not less than 50 years to run from the date the mortgage was executed, upon which is located, or which comprises or includes, one or more homes or other dwelling units, and includes, in addition to first mortgages, real estate sales contracts and such other classes of first liens as are commonly given to secure advances on real estate by institutions authorized under the act to become members under the laws of the State in which the real estate is located, together with the credit instruments, if any, secured thereby.

(Secs. 2, 10, 47 Stat. 725, as amended, 731, as amended; 12 U.S.C. 1422, 1430) [28 F.R. 4838, May 15, 1963]

The term "home" means a structure designed for residential use for one family.

(Secs. 2, 10, 47 Stat. 725, as amended, 731 as amended; 12 U.S.C. 1422, 1430) [28 F.R. 4838, May 15, 1963]

§ 521.6-2 Other dwelling unit.

The term "other dwelling unit" means a single combination of rooms suitable for a family, in a structure designed primarily for residential use that is not a home as defined in § 521.6-1.

(Secs, 2, 10, 47 Stat. 725, as amended, 781 as amended; 12 U.S.C. 1422, 1480) [28 FR. 4838, May 15, 1963]

§ 521.7 Member.

The term "member" means an institution which has been admitted to membership in a Federal Home Loan Bank. § 521.8 Net assets.

The term "net assets" means gross assets less:

(a) An amount equivalent to the book value of shares pledged in connection with loans of the share account sinking fund type;

(b) An amount equivalent to unapplied credits or mortgage loans;

(c) An amount equivalent to mortgages in process carried as a liability;

(d) An amount equivalent to unassumed mortgages on real estate owned if carried as a liability;

(e) Inter-series loans;
(f) Delinquent dues;

(g) An amount equivalent to reserves for depreciation on office building and furniture and fixtures unless these assets are carried at net figures with the reserves shown as a deduction from the original cost;

(h) An amount equivalent to special reserves established pursuant to § 545.18 of Subchapter C of this chapter and similar reserves established by Statechartered institutions pursuant to rules and regulations of State supervisory authorities;

(1) Current expenses;

(j) Any other similar contra item of an off-setting, bookkeeping nature. § 521.9 Obligations of the United States.

The term "obligations of the United States" means all evidences of indebtedness issued by the United States or fully guaranteed as to principal and interest by the United States.

§ 521.10 State.

Except as defined in § 522.27 of this subchapter, the term "State" means any one of the States, the District of Columbia, Puerto Rico, the Virgin Islands of the United States, or Guam.

[27 F.R. 8825, Sept. 5, 1962; 27 F.R. 9248, Sept. 19, 1962]

§ 521.11 Paid-in value.

The term "paid-in value" of stock in a Federal Home Loan Bank means the aggregate par value of stock in such Bank which is fully paid, and the sum of payments on the par value of stock which is not fully paid.

tained in section 6(a) of the act, shall be sold at par unless a price in excess of par has been designated by the Board. § 522.6 Dividends.

The board of directors of a Bank may, with the approval of the Board, declare dividends out of net earnings or undivided profits to stockholders of record at the close of business on June 30 and/or December 31 upon the paid-in value of capital stock outstanding on such record date payable on a date to be specified in the resolution declaring said dividend. On payments made on account of stock during the dividend period (after deducting amounts of any stock repurchased), dividends shall be computed for the time such payments were invested in the Bank's stock.

§ 522.10 Issuance of stock certificates.

When a Bank receives advice that an institution has been approved for membership by the Board, it shall issue as of the effective date of such membership, in the name of such member, a certificate of stock for the full amount of such member's stock subscription and upon the issuance of such certificate such member shall be deemed stockholder of record; but where such member has not made full and final payment on acount of its stock subscription, the Bank shall hold the stock certificates so issued until full payment therefor has been received by the Bank. Upon the change in the name of a member a new certificate shall be issued in the new name of the member.

[25 F.R. 2417, Mar. 23, 1960]

Upon the consolidation of two or more member institutions into a single institution operating under the charter of one of the consolidating institutions, the stock subscriptions of the institutions, other than the one surviving, may be refunded to the consolidated institution after adjustment to the minimum number of shares required to be held by the consolidated institution under the provisions of section 6(c) and/or section 10(c) of the act.

[25 F.R. 2417, Mar. 23, 1960]

§ 522.12 Stock certificates in reorgani zations.

If a member institution reorganizes by transfering all of its assets to another

institution or by transferring a portion of its assets to such institution and retaining the remainder for liquidating, the Bank shall, subject to the approval of the Board, and providing no advances are outstanding necessitating the holding of the stock as collateral, either refund to the member the value thereof (which shall not exceed the amount paid in), or, at its discretion, to the institution acquiring the assets; except, however, in lieu of the latter, if the institution acquiring the assets has made application and has been approved for membership, the Bank is authorized to apply as a payment on the stock subscription of such institution the refund value of the liquidating member's stock. [25 F.R. 2417, Mar. 23, 1960]

§ 522.13 Lost or destroyed certificates.

The Banks are authorized to issue certificates of stock to replace certificates lost or destroyed, upon preservation by the member of satisfactory evidence of such loss or destruction, and such certificates shall show on the face thereof that they are duplicates.

APPOINTMENT AND ELECTION OF DIRECTORS § 522.20 Appointive directors.

(a) The Board will appoint four directors for each bank. Each director must be a citizen of the United States and a bona fide resident of the district in which the bank is located.

(b) The term of each appointive director shall be four years. In the event of a vacancy in any appointive directorship, the Board shall appoint a director to fill such vacancy for the unexpired term thereof except that, if any director ceases to have the qualifications set forth in paragraph (a) of this section, the office held by such director shall immediately become vacant, but such director may continue to act as director until his successor assumes the vacated office or the term of such office expires, whichever shall first occur.

(Secs. 3, 7, 12, 26, 47 Stat. 726, 730, 735, 740, as amended; 12 U.S.C. 1423, 1427, 1432, 1446) [27 F.R. 3914, Apr. 25, 1962, as amended at 29 F.R. 312, Jan. 14, 1964]

which shall be designated to represent the members located in the Commonwealth of Puerto Rico under the provisions of the last sentence of subsection (e) of section 7 of the Federal Home Loan Bank Act, as amended. Notwithstanding the provisions of the preceding sentence, whenever the provisions of the second sentence of subsection (c) of section 7 of the act are applicable, the number of elective directors shall be increased by the Board to such number as may be necessary to comply with the provisions of the aforesaid second sentence of said subsection (c). The word "member" as used in this paragraph (a) shall have only the meaning set out in § 521.7 of this subchapter.

(b) The Board will designate the elective directorship or directorships for each particular State as representing the members located in such State, and any such directorship shall be filled only by a person who is an officer or director of a member located in that State who is a citizen of the United States and a bona fide resident of the district in which the Bank is located. For the purposes of §§ 522.21-522.28, the word "member" (except as hereinafter otherwise indicated), in addition to the meaning set out in § 521.7 of this subchapter, shall mean a member of a Bank at the end of the calendar year next preceding the election; and any such member shall be deemed to be located in the State in which it has its principal place of business. In the event a member does not have its principal place of business located in a State, the Board will designate the State in which such member shall be deemed to be located but may, however, in its discretion change any such designation from time to time.

(c) The Board will designate not less than one nor more than six elective directorships for each State. The number of elective directorships so designated shall be determined in the approximate ratio of the percentage of the required stock of the members located in each State in a Bank district to the total required stock of all members in such Bank district. In the event, however, that the number of elective directorships so designated for any State would be less than the total number of such directorships filed by officers or directors of members whose principal places of business were located in such State on December 31, 1960, the Board will add to the board of directors of the Bank of the district in