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Can you summarize 12 USC 1831p1?
FEDERAL DEPOSIT INSURANCE CORPORATION > Standards for safety and soundness
Short Summary
This legal document, found in the United States Code under the section for the Federal Deposit Insurance Corporation, establishes standards for safety and soundness in the banking industry. It applies to all insured depository institutions. The document outlines operational and managerial standards that must be followed, including internal controls, loan documentation, credit underwriting, interest rate exposure, asset growth, and compensation. It also requires appropriate Federal banking agencies to prescribe standards related to asset quality, earnings, and stock valuation. The document further sets compensation standards, prohibiting excessive compensation or benefits that could lead to financial loss for the institution. It provides criteria for determining when compensation is excessive, taking into account factors such as the value of benefits, compensation history, financial condition of the institution, and comparable practices at other institutions. The document also establishes requirements for submitting plans to correct deficiencies and outlines actions that can be taken by the appropriate Federal banking agency if an institution fails to meet the prescribed standards. Overall, this document aims to ensure the safety and soundness of insured depository institutions in the United States banking system.
Whom does it apply to?
All insured depository institutions
What does it govern?
Standards for safety and soundness
What are exemptions?
No exemptions are mentioned.
What are the Penalties?
Penalties are not specified in the document.
Jurisdiction
U.S. Federal Government