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TITLE 12-BANKS AND BANKING

Chapter II—Board of Governors of the Federal Reserve System.
Chapter III—Federal Deposit Insurance Corporation..

Part 201 302

CHAPTER II-BOARD OF GOVERNORS OF THE FEDERAL

RESERVE SYSTEM

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Part 223 Financing of war production and

war contract termination. (Revised)

Part 201 Discounts for and advances to

member banks by Federal Re

serve banks. (Amended) 222 Consumer credit. (Amended] PART 201-DISCOUNTS FOR AND

ADVANCES TO MEMBER BANKS BY FEDERAL RESERVE BANKS

INTRODUCTION Sec. 201.1 Discount of notes, drafts, and bills of

member banks. (Amended] $ 201.1 Discount of notes, drafts, and bills of member banks.

(h) Determination of eligibility. * The requirement of this section that a note, draft, or bill of exchange be negotiable shall not be applicable with respect to any note, draft, or bill of exchange evidencing a loan which is in whole or in part the subject of a guarantee or commitment made pursuant to Executive Order No. 9112 or the Contract Settlement Act of 1944. [Last sentence amended, effective Sept. 11, 1944, 9 F.R. 11147)

(d) Statement of transaction. * The statement of transaction need not include a description of the article if it is purchased by means of a coupon • book or similar medium of instalment

credit upon which a cash down payment of at least one-third of its purchase value has been made. (Sentence added Mar. 23, 1944, effective Apr. 3, 1944, 9 F.R. 3443)

§ 222,5 Charge accounts.

(d) Curing defaults. In the case of any charge account obligation of any member or former member of the armed forces of the United States incurred prior to his induction into such service, a default may be cured by the purchaser entering into a written agreement in good faith to make payment according to such terms as the registrant shall deem it appropriate to require.

CODIFICATION: The text set forth above was added to $ 222.5 (d) following subparagraph (3) thereof by Regulations, Board of Governors of the Federal Reserve System, Mar. 23, 1944, effective Apr. 3, 1944, 9 F.R. 3443.

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PART 222_CONSUMER CREDIT Sec. 222.4 Instalment sales. (Amended) 222.5 Charge accounts. (Amended) 222.6 Instalment loans. (Amended] 222.7

Single payment loans. (Amended] 222.8 Exceptions. (Amended] 222.10 Renewal, revisions, and additions of

instalment credit. (Amended] 222.12 Miscellaneous provisions. (Amended] 222.13 Listed articles, down payments and

maximum credit values. (Amended) $ 222.4 Instalment sales. (a) Down payment.

(3) In the case of articles the cash price of which is $10.00 or less, no down payment is required. [Subparagraph (3) amended Mar. 23, 1944, effective Apr. 3, 1944, 9 F.R. 3443)

(f) Authorizationof small items. CODIFICATION; In § 222.5 (f) "30 days" was substituted for "15 days" by Regulations, Board of Governors of the Federal Reserve System, Mar, 23, 1944, effective Apr. 3, 1944, 9 F.R. 3443.

(g) Small defaults. A charge account shall not be deemed to be “in default" within the meaning of $$ 222.5 (c) or 222.12 (m) if the amount in default is less than $10.00. [Paragraph (g)

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amended Mar. 23, 1944, effective Apr. 3, ment loan, except under the provisions 1944, 9 F.R. 3443)

of § 222.7 (c), unless he shall have ac

cepted in good faith a signed Statement § 222.6 Instalment loans.

of the Borrower as to the purposes of the

loan. Such statement shall state (d) Statement of the borrower. No

whether or not any of the proceeds of registrant shall make any instalment

the loan are to be used to make a down loan, except under the provisions of

payment on the purchase of a listed § 222.10 (a), unless he shall have ac

article or to be used to purchase any cepted in good faith a signed Statement

listed article having a cash price of $15 or of the Borrower as to the purposes of the

more, and, if any of the proceeds of the loan. Such statement shall state

loan are to be so used, such statement whether or not any of the proceeds of the loan are to be used to make a down pay

shall identify such listed article and

shall state the cash price thereof and the ment on the purchase of a listed article or to be used to purchase any listed

value of any trade-in. If a registrant

relies in good faith on the facts set out article having a cash price of $15.00 or

by the obligor in such statement, it shall more, and, any of the proceeds of the

be deemed to be correct for the purposes loan are to be so used, such statement

of the registrant. (The registrant, at shall identify such listed article and shall state the cash price thereof and the value

his option, may use either his own form

or the most recent Statement of Borof any trade-in. Such statement shall state also whether or not any of the

rower form prescribed by the Board.) proceeds of the loan are to be used to effective Apr. 3, 1944, 9 F.R. 3444]

[Paragraph (d) amended Mar. 23, 1944, reduce or retire any instalment sale or instalment loan, or any single-payment loan which is subject to this regulation, $ 222.8 Exceptions. or any charge account arising in whole

(m) Fuel conservation credits. or in part from the sale of a listed article,

(1) the conversion of heating and, if any of the proceeds are to be so

equipment to the use of any other fuel, used, shall state the amount of such obligation and the terms of payment.

the repair of heating equipment, or the If a registrant relies in good faith on

replacement of heating equipment if it the facts set out by the obligor in such

is worn out, damaged beyond repair, or statement, it shall be deemed to be cor

destroyed.

(Subparagraph rect for the purposes of the registrant.

(1) amended Mar. 23, 1944, effective (The registrant, at his option, may use

Apr. 3, 1944, 9 F.R. 3445] either his own form or the most recent Statement of Borrower form prescribed (p) Loans to Indians. Any extension by the Board.) (Paragraph (d) amend of credit made in accordance with regued Mar. 23, 1944, effective Apr. 3, 1944,

lations of the Secretary of the Interior 9 F.R. 3444]

for the economic development or reha$ 222.7 Single payment loans. * bilitation of Indians. [Paragraph (p) (c) Renew als and extensions. added Mar. 23, 1944, effective Apr. 3,

1944, 9 F.R. 3445) (3) (i) with respect to any

(q) Servicemen's guaranteed loans. obligation of any member or former Any extension of credit guaranteed in member of the armed forces of the whole or in part by the Administrator United States incurred prior to his in of Veterans' Affairs pursuant to the production into such service. [Subdivision

visions of Title III of the Servicemen's (i) amended Mar. 23, 1944, effective Apr.

Readjustment Act of 1944. (Paragraph 3, 1944, 9 F.R. 3444]

(q) added Nov. 3, 1944, effective Nov. 6,

1944, 9 F.R. 13193] (d) Statement of the borrower. No registrant shall make any single-pay

$ 222.10 Renewals, revisions and ad

ditions of instalment credit_(a) Re1 This requirement does not apply to a newals or revisions.

(1) with single-payment loan made for business pur

respect to any obligation of any member poses, to a business enterprise, or for agricultural purposes, to a person engaged in

or former member of the armed forces agriculture, unless the proceeds are to be

of the United States incurred prior to used to purchase a listed article.

his induction into such service.

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(Subparagraph (1) amended Mar. 23, 1944, effective Apr. 3, 1944, 9 F.R. 3445]

(d) Statement of necessity to prevent undue hardship.

CODIFICATION: In the second paragraph of $ 222.10 (d), the phrase "in form and content prescribed by the Board,” was deleted by Regulations, Board of Governors of the Federal Reserve System, Mar. 23, 1944, effective Apr. 3, 1944, 9 F.R. 3445.

$ 222.12 Miscellaneous provisions.

whether or not there has been compliance with the requirements of the regulations in this part, every person required to be licensed under $ 222.3 shall permit the Board or any Federal Reserve Bank, by its duly authorized representatives, to make such inspections of his business operations as the Board or Federal Reserve Bank may deem necessary or appropriate, including inspections of books of account, contracts, letters or other relevant papers wherever located, and, for such purpose, shall furnish such reports as the Board or the Federal Reserve Bank may require. When ordered to do so by the Board, every such person shall furnish, under oath or otherwise, such information relative to any transaction within the scope of the Executive order as the Board may deem necessary or appropriate for such purpose, including the production of books of account, contracts, letters or other papers in the custody or control of such person. [Paragraph (i) amended Mar. 23, 1944, effective Apr. 3, 1944, 9 F.R. 3445]

(b) Extension of credit for mixed purposes. In case an extension of credit is partly subject to one section of this regulation and partly subject to another section, the amount and terms of such extension of credit shall be such as would result if the credit were divided into two or more parts and each part were treated as if it stood alone. In case an extension of credit is partly subject to this regulation and partly not subject to the regulation, the amount and terms of such extension of credit shall be such as would result if the credit were divided and the part subject to the regulation were treated according to the applicable provisions of the regulation; the part not subject to the regulation may be treated as if the regulation did not exist. (Paragraph (b) amended June 20, 1944, effective June 22, 1944, 9 F.R. 6937]

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(n) Mail orders. An instalment sale shall not be deemed to be in violation of § 222.4 (a) if the sale is made upon the receipt of a mail order for one or more articles and the cash deposit received with the order fails by less than $1.00 to equal the sum of the down payments required by the regulations in this part for all of the articles included in the order. (Paragraph (n) added Mar. 23, 1944, effective Apr. 3, 1944, 9 F.R. 3445)

$ 222.13 Listed articles, down payments and maximum credit values.

(h) Preservation of records. Every registrant shall preserve, for the life of the obligation to which they relate, such books of account, records, and other papers (including any statements required by or obtained pursuant to the regulations in this part) as are relevant to establishing whether or not an extension of credit within the scope of the regulations in this part was in conformity with the requirements thereof, Provided, however, That the statement of the Borrower obtained pursuant to $ 222.6 (d) or $ 222.7 (d) shall be preserved for the life of the obligation to which it relates or for one year, whichever period is longer, And provided further, That the registrant may preserve photographic reproductions in lieu of such books of accounts, records, or papers.

(Paragraph (h) amended Mar. 23, 1944, effective Apr. 3, 1944, 9 F.R. 3445]

(1) Inspections and production of records. For the purpose of determining

(c) Down payment on automobiles and motorcycles. For a new or used automobile or a new or used motorcycle, the down payment (which may be in cash or in the form of a trade-in or in both forms) shall be one-third of the cash price. [Paragraph (c) amended, June 16, 1944, effective July 10, 1944, 9 F.R. 6802]

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(e) Marimum amount of loan.

A loan to purchase a new or used automobile or a new or used motorcycle shall not exceed two-thirds of the cash price. [Last undesignated paragraph amended June 16, 1944, effective July 10, 1944, 9 F.R. 6802]

PART 223—FINANCING OF

WAR PRODUCTION AND WAR CON

TRACT TERMINATION [REVISED] Sec. 223.1 Objective of the Federal Reserve Sys

tem. 223.2 Operations of the Federal Reserve

Banks. 223.3 Rates. 223.4 Responsibility and expenses of Fed

eral Reserve Banks. 293.5 Reports.

AUTHORITY: $ $ 223.1 to 223.5, inclusive, issued under 38 Stat. 262, 265, 48 Stat, 1105, as amended, 56 Stat. 355, 58 Stat. 649; 12 U.S.C. and Sup., 248, 391, 352 (a), 50 U.S.C. App., Sup., 1107.

SOURCE: $ $ 223.1 to 223.5, inclusive, contasned in Regulation V, Board of Governors of the Federal Reserve System, revised effective Sept. 11, 1944, 9 F.R. 11148.

CROSS REFERENCE: For interim financing regulations of the Office of Contract Settlement, see Title 32, Chapter XX, infra.

§ 223.1 Objective of the Federal Reserve System. The objective of the Federal Reserve System in carrying out the purposes of the applicable provisions of the Executive order and of the Settlement Act is to facilitate and expedite the financing of contractors, subcontractors and others in connection with war production and in connection with claims arising out of the termination of war contracts or operations. The Board of Governors of the Federal Reserve System and the Federal Reserve Banks will cooperate fully in order to achieve this objective. The Federal Reserve Banks have heretofore been designated as fiscal agents of the United States by the Secretary of the Treasury pursuant to the terms of the Executive order and are authorized by the Settlement Act to act on behalf of the contracting agencies 1 as fiscal agents of the United States in carrying out the purposes of the act.

'$ 223.2 Operations of the Federal Reserve Banks. The operations of the Federal Reserve Banks pursuant to the provisions of the Executive order and

of the Settlement Act will be conducted, under the supervision of the Board of Governors of the Federal Reserve System, in accordance with such instructions as may be issued by the contracting agencies.

$ 223.3 Rates. Rates of interest, guarantee and commitment fees, and other charges with respect to loans made or guaranteed in whole or in part by any contracting agency through the agency of any Federal Reserve Bank will from time to time be prescribed, either specifically or by maximum limits or otherwise, by the Board of Governors of the Federal Reserve System with the concurrence of the Director of Contract Settlement.

$ 223.4 Responsibility and expenses of Federal Reserve Banks. No Federal Reserve Bank shall have any responsibility or accountability except as agent in taking any action under the Executive order, the Settlement Act, or the regulations in this part. In any case in which any Federal Reserve Bank shall make or participate in making any loan, discount, advance, guarantee or commitment as agent of any contracting agency under authority of the Executive order or of the Settlement Act, all such funds as may be necessary to carry out any obligation assumed on behalf of such contracting agency shall be supplied by and disbursed under authority from such agency in accordance with such procedure as it may require. Each Federal Reserve Bank shall be reimbursed by each contracting agency for all expenses and losses (including, but not limited to, attorneys' fees and expenses of litigation) incurred by such Federal Reserve Bank in acting as fiscal agent of the United States on behalf of such contracting agency under or pursuant to the Executive order or the Settlement Act.

§ 223.5 Reports. Each Federal Reserve Bank shall make such reports as the Board of Governors of the Federal Reserve System shall require with respect to its operations pursuant the terms of the Executive order or the Settlement Act and of the regulations in this part.

1 The term "contracting agency" is used herein with the same meaning as that given it in the Contract Settlement Act of 1944.

CHAPTER III—FEDERAL DEPOSIT INSURANCE CORPORATION

Part 302 Assessments. [Amended] 303 Advertisement of membership.

(Amended] 304 Payment of deposits and interest

thereon by insured nonmember banks. [Amended]

Part 306 Agents for service of process.

[Revised] 309 Voluntary termination of insured

status. [Added]

minated under paragraphs (1) or (2) of subsection (i), of section 12B of the Federal Reserve Act, as amended (12 U.S.C. 264 (i) (1) and (2)), makes application to the Corporation, before the insurance of its deposits shall have ceased, to be permitted to continue or to resume its status as an insured bank and if the directors grant the application, the bank will be deemed, for assessment purposes, to continue as an insured bank and must thereafter furnish certified statements and pay assessments as though its insured status had not been terminated. (49 Stat. 688, 690, 693; 12 U.S.C. 264 (h), (i), (j)) [Res., June 15, 1944, 9 F.R. 8284]

PART 302-ASSESSMENTS Sec. 302.3 Payment of assessments by banks

whose insured status has termi

nated. (Revised] $ 302.3 Payment of assessments by banks whose insured status has terminated-(a) Assumed deposits of terminating bank become deposits of assuming bank. The deposit liabilities of one bank, if assumed by a second insured bank, will, except to the extent that depositors of the first bank by affirmative action signify their express intention to hold the first bank liable as a debtor, be presumed for assessment purposes to cease being deposit liabilities of the first bank on the date the assumption becomes effective, Provided, The requisite notice of assumption be given to the depositors. The assumed deposits, for assessment purposes, are deposit liabilities of the assuming bank from the date of assumption, whether or not the requisite notice of assumption has been given to the depositors.

(b) Payment of assessments by assuming bank on assumed deposits of terminating bank. Where the deposit liabilities of an insured bank are assumed by another insured bank and the assuming bank agrees to file the certified statement which the terminating bank is required to file, the filling of such certifed statement and the payment of the assessment thereon by the assuming bank shall be deemed the acts of the terminating bank: Provided, The requisite notice of assumption be given to the depositors of the terminating bank and, Provided further, That such certified statement shall be filed separately from that required to be filed by the assuming bank.

(c) Resumption of insured status before insurance of deposits ceases. If a bank whose insured status has been ter

PART 303—ADVERTISEMENT OF

MEMBERSHIP Sec. 303.1 Mandatory requirements with regard

to the official signs and their dis

play. (Amended] 303.2 Mandatory requirements with regard

to the official advertising statement and m a n n er of use.

(Amended] § 303.1 Mandatory requirements with regard to the official signs and their display.

(b) Official sign. The official sign referred to in paragraph (a) of this section shall be seven inches by three inches in size, and shall be of the following design:

NOTE: For illustration, see 12 CFR 303.1 (b).

Any insured bank may procure the standard signs from the Corporation or may use any other sign of the same size, wording and appearance which shall have been approved in writing by the Corporation as conforming to the requirements of this section. Such approval will be given only in individual cases where the standard sign does not

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