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Can you summarize 12 CFR Part 212?
BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM > MANAGEMENT OFFICIAL INTERLOCKS
Short Summary
These legal documents, found in the Code of Federal Regulations under the Banks and Banking section, govern management official interlocks between depository organizations. They aim to foster competition by generally prohibiting a management official from serving two nonaffiliated depository organizations in situations where the management interlock likely would have an anticompetitive effect. The documents apply to management officials of state member banks, bank holding companies, and their affiliates. They provide definitions for various terms used in the context of management official interlocks and outline the applicability of these definitions to depository organizations. The documents also provide exemptions for certain management officials, including depository organizations in liquidation or under the control of a receiver, conservator, or similar official, and corporations operating under specific sections of the Federal Reserve Act. However, no specific penalties are mentioned for non-compliance with these definitions and exemptions. The documents further specify the prohibitions related to management official interlocks between depository organizations. They state that a management official of a depository organization cannot simultaneously serve as a management official of an unaffiliated depository organization if they have offices in the same community or the same relevant metropolitan statistical area (RMSA), provided that the depository organizations have total assets of $50 million or more. Additionally, a management official of a depository organization with total assets exceeding $10 billion (or any affiliate of such an organization) cannot serve as a management official of an unaffiliated depository organization with total assets exceeding $10 billion (or any affiliate of such an organization), regardless of location. The documents mention that the thresholds may be adjusted based on changes in the Consumer Price Index. The Board of Governors of the Federal Reserve System has the authority to exempt an interlock from the prohibitions if it determines that the interlock would not result in a monopoly or substantial lessening of competition and would not present safety and soundness concerns. The documents also outline the termination and transition period for management officials in case of a change in circumstances that causes a previously permissible interlock to become prohibited. The Board administers and enforces the Interlocks Act with respect to state member banks, bank holding companies, and their affiliates, and may refer any case of a prohibited interlocking relationship involving these entities to the Attorney General of the United States for enforcement. However, if an affiliate of a state member bank or a bank holding company is subject to the primary regulation of another Federal depository organization supervisory agency, then the Board does not administer and enforce the Interlocks Act with respect to that affiliate.
Whom does it apply to?
Management officials of state member banks, bank holding companies, and their affiliates
What does it govern?
Management official interlocks between depository organizations
What are exemptions?
Exemptions include depository organizations in liquidation or under the control of a receiver, conservator, or similar official; corporations operating under section 25 or section 25A of the Federal Reserve Act; credit unions being served by a management official of another credit union; depository organizations that do not conduct business within the United States except as an incidental activity; State-chartered savings and loan guaranty corporations; Federal Home Loan Banks and bankers' banks; depository organizations that are closed or in danger of closing and are acquired by another depository organization; and diversified savings and loan holding companies with respect to the service of a director who is also a director of an unaffiliated depository organization, subject to certain conditions and regulatory agency approval.
What are the Penalties?
No specific penalties are mentioned in these documents.
Jurisdiction
U.S. Federal Government