Registration Statement for Persons Who Extend Credit Secured by Margin Stock (Other Than Banks, Brokers, or Dealers)
Nonbank lenders making loans above stated thresholds that are secured by margin stock must register with the Federal Reserve using the FR G-1 registration statement, which collects information about the lender's background and volume of lending. A registered lender may apply to deregister using FR G-2 if the lender has not, during the preceding six months, had more than $200,000 of margin credit outstanding.
Purpose: The Federal Reserve uses the data to identify lenders subject to Regulation U, to verify compliance with the regulation, and to monitor margin credit.
The Securities Exchange Act of 1934 ('34 Act) authorizes the Board to regulate securities credit issued by banks, brokers and dealers, and other lenders. Until their 1998 revision, the securities credit regulations were distinguished by the type of lender to which they were applied, that is, banks, brokers and dealers, and others. Regulation T has governed the credit activities of brokers and dealers since 1934. Regulation U, governing banks, was adopted in 1936. The Federal Reserve adopted Regulation G in 1968 as a companion to Regulation U, to stop unregulated lenders from circumventing the margin requirements of Regulations T and U. The FR G-1 and FR G-2 have existed in some form since 1968. Effective April 1, 1998, the National Securities Markets Improvement Act of 1996 repealed section 8(a) of the '34 Act, which distinguished between bank and nonbank lenders with respect to broker-dealers. The amendment eliminated the need for separate regulations, and Regulation G was merged into Regulation U.
Nonbank lenders. Participation is required.
The FR G-l must be filed within thirty days following the end of the calendar quarter during which the lender becomes subject to the registration requirements.
The information collected on the FR G-1 is confidential.
Last Update: October 3, 2018