10312, Feb. 22, 1977; 43 FR 58081, Dec. 12, 1978]

PART 332-POWERS INCONSISTENT WITH PURPOSES OF FEDERAL DEPOSIT INSURANCE LAW

Sec.

332.1 Inconsistent powers. 332.2 Exercise prohibited.

§ 332.1 Inconsistent powers.

A State nonmember insured bank (except a District bank) which does not have any of the powers hereinafter enumerated, or which, although it has any such power, does not exercise the same, shall not hereafter exercise, take, or assume the power: (a) To do a surety business; (b) to insure the fidelity of others; (c) to engage in insuring, guaranteeing or certifying titles to real estate; or (d) to guarantee or become surety upon the obligations of others.1

(Secs. 6, 9, 64 Stat. 876, 881; 12 U.S.C. 1816, 1819)

[39 FR 29178, Aug. 14, 1974]

REGULATIONS

§ 333.1 Classification of general character of business.

State nonmember insured banks are divided into five categories for the purpose of classifying their general character or type of business,2 viz: commercial banks, banks and trust companies, savings banks (including mutual and stock), industrial banks, and cash depositories.

[15 FR 8644, Dec. 6, 1950]

§ 333.2 Change in general character of business.

No State nonmember insured bank (except a District bank) or branch thereof shall hereafter cause or permit any change to be made in the general character or type of business exercised by it after the effective date of this part without the prior written consent of the Corporation.

[15 FR 8644, Dec. 6, 1950]

INTERPRETATIONS

§ 333.101 Prior consent not required.

(a) The extension by any State nonmember insured bank of its business to include personal, character or installment loans, or the extension by an industrial bank of its business to include the business of a commercial bank, is not a change in the general character or type of business requiring the prior written consent of the Corporation.

(b) An insured State nonmember bank not exercising trust powers may act as trustee or custodian of Individual Retirement Accounts established pursuant to the Employee Retirement Income Security Act of 1974 and SelfEmployed Retirement Plans established pursuant to the Self-Employed Individuals Retirement Act of 1962 without the prior written consent of the Corporation provided: (1) The bank's duties as trustee or custodian are essentially custodial or ministerial in nature, (2) the bank is required to invest the funds from such plans only in its own time or savings deposits, and (3) the bank's acceptance of such ac

2A bank's business may include two or more of the general classifications.

§ 334.1 Authority and scope.

This part implements the provisions of section 5 of the Bank Service Corporation Act, Public Law 87-856, approved October 23, 1962 (76 Stat. 1132), in the application thereof to arrangements for the performance of bank services for insured State nonmember banks. Under this section of the Act, no insured State nonmember bank may cause to be performed, by contract or otherwise, any bank services for itself, whether on or off its premises, unless assurances satisfactory to the Board of Directors of the Federal Deposit Insurance Corporation are furnished to the Board of Directors by both the bank and the party performing such services that the performance thereof will be subject to regulation and examination by the Board of Directors to the same extent as if such services were being performed by the bank itself on its own premises. Such assurances are required by the Act whether the bank services are performed by bank service corporations in which the Act authorizes banks to invest, or by others. Under section 1(b) of the Act, the term "bank services" means services such as check and deposit sorting and posting, computation and posting of interest and other credits and charges preparation and mailing of checks, statements, notices, and similar items, or other clerical bookkeeping, accounting, statistical, or similar functions performed for a bank.

[28 FR 3201, Apr. 3, 1963]

§ 334.2 Form of assurances.

Unless additional or different assurances are considered necessary by the Board of Directors in specific cases, the assurances referred to in § 334.1 may be submitted in the form of a letter (or authorized officer of the insured State non-member bank and by the party (or a duly separate letters) signed by a duly au-authorized officer or representative of such party) that will perform the services for the bank, stating, in substance, that the bank and the party performing such services have entered into an agreement that the performance of the services will be subject to regulation and examination by the Board of Directors to the same extent as if such services were being performed by the bank itself on its own premises. All such letters of assurances shall be addressed to the Regional Director of the Federal Deposit Insurance Corporation Region in which the insured State nonmember bank has its main office.

[28 FR 3201, Apr. 3, 1963, as amended at 36 FR 1248, Jan. 27, 1971]

§ 334.3 Time for furnishing assurances.

As to any arrangement for the performance of bank services entered into or renewed after the effective date of this part, assurances complying with § 334.2 shall be furnished prior to the performance of any services for the bank under the bank service arrangement. With respect to any bank service arrangement entered into prior to the effective date of this part, such assurances shall be furnished within 30 days after the effective date of this part, unless a letter of assurance covering such bank service arrangement has been furnished previously pursuant to the Board of Directors' "Statement for State Nonmember insured Banks on the 'Bank Service Corporation Act'" issued October 24, 1962.

[28 FR 3201, Apr. 3, 1963]

§ 334.4 Special situations.

It is the policy of the Corporation that assurances complying with § 334.2 need not be furnished in connection with arrangements for bank services which are immediately necessary be

cause of emergency conditions or situations, or are required for short periods of time due to unusually heavy work demands, if the insured State nonmember bank promptly advises the Regional Director of the Federal Deposit Insurance Corporation Region in which it has its main office of the circumstances involved and of the length of time during which any of the bank's books or records or any banking media will be removed from the bank's premises and of the location thereof, and unless the bank is advised by the Regional Director that such assurances must be furnished. Unless specifically requested by the Board of Directors, assurances complying with § 334.2 need not be furnished in connection with any arrangement by an insured State nonmember bank for the performance of legal, advisory, and administrative services, such as transportation or guard services.

[28 FR 3201, Apr. 3, 1963, as amended at 32 FR 9638, July 4, 1967; 36 FR 1248, Jan. 27, 1971]

Sec.

335.46 Form for registration of additional class of securities of a bank pursuant to section 12(b) or section 12(g) of the Securities Exchange Act of 1934 (Form F10).

335.47 Form for statement to be filed pursuant to § 335.4(h)(2) or 335.5(1) of Part 335 (Form F-11).

335.51 Form for proxy statement; statement where management does not solic

it proxies (Form F-5).

335.52 Form for statement in election contests (Form F-6).

335.53 Form for statement to be filed pursuant to § 335.5(m) of Part 335 (Form F12).

335.54 Tender offer statement to be filed pursuant to section 14(d)(1) of the Securities Exchange Act of 1934 (Form F13).

335.61 Initial statement of beneficial ownership of equity securities (Form F-7). 335.62 Statement of changes in beneficial ownership of equity securities (Form F8).

335.71 Forms for financial statements (Forms F-9A, B, C, D and E).

AUTHORITY: Sec. 12(i) of the Securities Exchange Act of 1934, as amended (15 U.S.C. 787(i)).

SOURCE: 40 FR 47346, Oct. 8, 1975, unless otherwise noted.

§ 335.1 Scope of part.

This part is issued by the Federal Deposit Insurance Corporation (the "Corporation") pursuant to section 12(i) of the Securities Exchange Act of 1934, as amended (15 U.S.C. 78) (the “Act”) and applies to all securities of a bank which is organized under State law, is insured by the Federal Deposit Insurance Corporation and is not a member of the Federal Reserve System ("bank”) that are subject to the registration requirements of section 12(b) or section 12(g) of the Act. § 335.2 Definitions.

For the purposes of this Part, including all forms and instructions promulgated for use in connection herewith, unless the context otherwise requires:

(a) The terms "exchange", "director", "person", "security" and "equity security" have the meanings given them in section 3(a) of the Act.

(b) The term "affiliate" (whether referred to as an "affiliate" of, or a

person "affiliated” with, a specified person) means a person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the person specified.

(c) The term "amount", when used with respect to securities, means the principal amount if relating to evidences of indebtedness, the number of shares if relating to shares, and the number of units if relating to any other kind of security.

(d) The term "associate", when used to indicate a relationship with any person, means (1) any corporation or organization (other than the bank or a subsidiary of the bank) of which such person is an officer or partner or is, directly or indirectly, either alone or together with one or more members of his immediate family, the beneficial owner of 10 percent or more of any class of equity securities, (2) any trust or other estate in which such person has a substantial beneficial interest or as to which such person serves as a trustee or in a similar fiduciary capacity, and (3) any relative or spouse of such person or any relative of such spouse, who has the same home as such person or who is a director or officer of the bank or any of its parents or subsidiaries.

(e) The terms "beneficial ownership", "beneficially owned", and the like, when used with respect to the reporting of ownership of the bank's equity securities in any statement or report required by this Part, shall include, in addition to direct and indirect beneficial ownership by the reporting person, ownership of such securities (1) by the spouse (except where legally separated) and minor children of such reporting person, and (2) by any other relative of the reporting person who has the same home as such person.

(f) The term "charter" includes articles of incorporation, declarations of trust, articles of association or partnership, or any similar instrument, as amended, effecting (either with or without filing with any governmental agency) the organization or creation of an incorporated or unincorporated person.

(g) The term “control” (including the terms "controlling", "controlled by", and "under common control with") means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract, or otherwise.

(h) The term "employee" does not include a director, trustee or officer.

(i) The term "equity capital accounts" means capital stock, surplus, undivided profits, and reserve for contingencies and other capital reserves.

(j) The term "50-percent-owned person", in relation to a specified person, means a person approximately 50 percent of whose outstanding voting securities is owned by the specified person either directly, or indirectly through one or more intermediaries.

(k) The term "fiscal year" means the annual accounting period or, if no closing date has been adopted, the calendar year ending on December 31.

(i) In any case where the records of security holders have not been maintained in accordance with accepted practice, any additional person who would be identified as such an owner on such records if they had been maintained in accordance with accepted practices shall be included as a holder of record.

(ii) Securities identified as held of record by a corporation, a partnership, a trust whether or not the trustees are named, or other organization shall be included as so held by one person.

(iii) Securities identified as held of record by one or more persons as trustees, executors, guardians, custodians, or in other fiduciary capacities with respect to a single trust, estate, or account shall be included as held of record by one person.

(iv) Securities held by two or more persons as co-owners shall be included as held by one person.

(v) Each outstanding unregistered or bearer certificate shall be included as held of record by a separate person, except to the extent that the bank can establish that, if such securities were registered, they would be held of record, under the provisions of this paragraph, by a lesser number of per

sons.

(vi) Securities registered in substantially similar names, where the bank has reason to believe because of the address or other indications that such names represent the same person, may be included as held of record by one person.

(2) Notwithstanding paragraph (1)(1) of this section:

(i) Securities held subject to a voting trust, deposit agreement, or similar arrangement shall be included as held of record by the record holders of the voting trust certificates, certificates of deposit, receipts, or similar evidences of interest in such securities; provided, however, that the bank may rely in good faith on such information as is received in response to its request from a nonaffiliated issuer of the certificates or interests.

(ii) If the bank knows or has reason to know that the form of holding securities of record is used principally to circumvent the provisions of section 12(g)(1) of the Act, the beneficial owners of such securities shall be deemed to be record owners thereof.

(m) The term "immediate family" includes a person's father, mother, spouse, brothers, sisters, sons and daughters, stepparents and stepchildren, and lineal ascendents and descendents. For the purpose of determining whether any of the foregoing relationships exist, a legally adopted child shall be considered a child by blood.

(n) The term "information statement" means the statement required by § 335.5(a), whether or not contained in a single document.

(0) The term "last fiscal year" of bank means the last fiscal year of bank ending prior to the date of the meeting with respect to which an in

formation statement is required to be distributed.

(p) The term "listed" means admitted to full trading privileges upon application by the bank and includes securities for which authority to add to the list on official notice of issuance has been granted.

(q) The term "majority-owned subsidiary" means a subsidiary more than 50 percent of whose outstanding securities representing the right, other than as affected by events of default, to vote for the election of directors is owned by the subsidiary's parent and/ or one or more of the parent's other majority-owned subsidiaries.

(r) The term "material", when used to qualify a requirement for furnishing of information as to any subject, limits the information required to those matters as to which an average prudent investor ought reasonably to be informed.

(s) The term "officer" or "principal officer" means a Chairman of the Board of Directors, Vice Chairman of the Board, Chairman of the Executive Committee, President, Vice President (except as indicated in the next sentence), Cashier, Treasurer, Secretary, Comptroller, and any other person who participates in major policymaking functions of the bank. In some banks (particularly banks with officers bearing titles such as Executive Vice President, Senior Vice President, or First Vice President as well as a number of "Vice Presidents"), some or all "Vice Presidents" do not participate in major policy-making functions, and such persons are not officers for the purpose of this Part.

(t) The term "option" means any option, warrant, or right other than those issued to security holders on a pro rata basis.

(u) The term "parent" of a specified person is a person controlling such person directly, or indirectly through one or more intermediaries.

(v) The term "plan" includes all plans, contracts, authorizations, or arrangements, whether or not set forth in any formal document.

(w) The term "predecessor" means a person the major portion of the business and assets of which another