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(a) Lending to
undercapitalized insured depository institutions. A Federal
Reserve Bank may make or have outstanding advances to or discounts for
a depository institution that it knows to be an undercapitalized
insured depository institution, only:
(1) If, in any 120-day period, advances or discounts from any
Federal Reserve Bank to that depository institution are not
outstanding for more than 60 days during which the institution is an
undercapitalized insured depository institution; or
(2) During the 60 calendar days after the receipt of a written
certification from the chairman of the Board of Governors or the head
of the appropriate federal banking agency that the borrowing
depository institution is viable; or
(3) After consultation with the Board of Governors. In unusual
circumstances, when prior consultation with the Board is not possible,
a Federal Reserve Bank should consult with the Board as soon as
possible after extending credit that requires consultation under this
paragraph (a)(3).
(b) Lending to critically undercapitalized insured depository
institutions. A Federal Reserve Bank may make or have outstanding
advances to or discounts for a depository institution that it knows to
be a critically undercapitalized insured depository institution only:
(1) During the 5-day period beginning on the date the institution
became a critically undercapitalized insured depository institution;
or (2) After consultation with the Board of Governors. In unusual
circumstances, when prior consultation with the Board is not possible,
a Federal Reserve Bank should consult with the Board as soon as
possible after extending credit that requires consultation under this
paragraph (b)(2).
(c) Assessments. The Board of Governors will
assess the Federal Reserve Banks for any amount that the Board pays to
the FDIC due to any excess loss in accordance with section 10B(b) of
the Federal Reserve Act. Each Federal Reserve Bank shall be assessed
that portion of the amount that the Board of Governors pays to the
FDIC that is attributable to an extension of credit by that Federal
Reserve Bank, up to 1 percent of its capital as reported at the
beginning of the calendar year in which the assessment is made. The
Board of Governors will assess all of the Federal Reserve Banks for
the remainder of the amount it pays to the FDIC in the ratio that the
capital of each Federal Reserve Bank bears to the total capital of all
Federal Reserve Banks at the beginning of the calendar year in which
the assessment is made, provided, however, that if any assessment
exceeds 50 percent of the total capital and surplus of all Federal
Reserve Banks, whether to distribute the excess over such 50 percent
shall be made at the discretion of the Board of Governors.
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