Official titleSection 1. Short title and definitionsSection 2. Federal Reserve DistrictsSection 2A. Monetary policy objectivesSection 2B. Appearances Before and Reports to the CongressSection 3. Branch OfficesSection 4. Federal Reserve BanksSection 5. Stock Issues; Increase and Decrease of CapitalSection 6. Insolvency of member banksSection 7. Division of EarningsSection 8. Conversion of state banks into national banksSection 9. State Banks as MembersSection 9A. Participation in lotteries prohibitedSection 9B. Resolution of Clearing BanksSection 10. Board of Governors of the Federal Reserve SystemSection 10A. Emergency advances to groups of member banks*Section 10B. Advances to Individual Member Banks*Section 11. Powers of Board of Governors of the Federal Reserve SystemSection 11A. Pricing of ServicesSection 11B. Annual Independent Audits of Federal Reserve Banks and BoardSection 12. Federal Advisory CouncilSection 12A. Federal Open Market CommitteeSection 13. Powers of Federal Reserve BanksSection 13A.* Discount of agricultural paperSection 14. Open-Market OperationsSection 15. Government DepositsSection 16. Note IssuesSection 17. Deposit of bonds by national banksSection 18. Refunding BondsSection 19. Bank ReservesSection 20. National bank notes redemption fund as reserveSection 21. Bank ExaminationsSection 22. Offenses of examiners, member banks, officers, and directorsSection 23. Interbank Liabilities*Section 23A. Relations with affiliatesSection 23B. Restrictions on Transactions with AffiliatesSection 24. Real Estate LoansSection 24A. Investment in Bank Premises or Stock of Corporation Holding PremisesSection 25. Foreign BranchesSection 25A. Banking Corporations Authorized to Do Foreign Banking Business*Section 25B. Jurisdiction of suits*Section 25C. Potential Liability on Foreign AccountsSection 26. [Repealed]Section 27. Tax on national bank notesSection 28. Reduction of capital of national banksSection 29. Civil Money PenaltySection 30. Saving clauseSection 31. Reservation of right to amend

Section 23. Interbank Liabilities*

(a) Purpose. The purpose of this section is to limit the risks that the failure of a large depository institution (whether or not that institution is an insured depository institution) would pose to insured depository institutions.

(b) Aggregate Limits On Insured Depository Institutions' Exposure To Other Depository Institutions. The Board shall, by regulation or order, prescribe standards that have the effect of limiting the risks posed by an insured depository institution's exposure to any other depository institution.

[12 USC 371b-2(b). As added by act of Dec. 19, 1991 (105 Stat. 2362).]

(c) Exposure Defined.

  1. In General. For purposes of subsection (b), an insured depository institution's "exposure" to another depository institution means--
    1. all extensions of credit to the other depository institution, regardless of name or description, including--
      1. all deposits at the other depository institution;
      2. all purchases of securities or other assets from the other depository institution subject to an agreement to repurchase; and
      3. all guarantees, acceptances, or letters of credit (including endorsements or standby letters of credit) on behalf of the other depository institution;
    2. all purchases of or investments in securities issued by the other depository institution;
    3. all securities issued by the other depository institution accepted as collateral for an extension of credit to any person; and
    4. all similar transactions that the Board by regulation determines to be exposure for purposes of this section.
  2. Exemptions. The Board may, at its discretion, by regulation or order, exempt transactions from the definition of "exposure" if it finds the exemptions to be in the public interest and consistent with the purpose of this section.
  3. Attribution Rule. For purposes of this section, any transaction by an insured depository institution with any person is a transaction with another depository institution to the extent that the proceeds of the transaction are used for the benefit of, or transferred to, that other depository institution.

[12 USC 371b-2(c). As added by act of Dec. 19, 1991 (105 Stat. 2362.]

(d) Insured Depository Institution. For purposes of this section, the term "insured depository institution" has the same meaning as in section 3 of the Federal Deposit Insurance Act.

[12 USC 371b-2(d). As added by act of Dec. 19, 1991 (105 Stat. 2362).]

(e) Rulemaking Authority; Enforcement. The Board may issue such regulations and orders, including definitions consistent with this section, as may be necessary to administer and carry out the purpose of this section. The appropriate Federal banking agency shall enforce compliance with those regulations under section 8 of the Federal Deposit Insurance Act.

[12 USC 371b-2(e). As added by act of Dec. 19, 1991 (105 Stat. 2362).]

* The original section 23 was repealed by section 7 of the act of Sept. 8, 1959 (73 Stat. 457). This section 23 is effective Dec. 19, 1992.

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Last Update: February 14, 2017