[Code of Federal Regulations]
[Title 12, Volume 3, Parts 220 to 299]
[Revised as of January 1, 2001]
From the U.S. Government Printing Office via GPO Access
[CITE: 12CFR225.92]

[Page 117-118]
 
                       TITLE 12--BANKS AND BANKING
 
                   CHAPTER II--FEDERAL RESERVE SYSTEM
 
PART 225--BANK HOLDING COMPANIES AND CHANGE IN BANK CONTROL (REGULATION Y)--Table of Contents
 
                 Subpart I--Financial Holding Companies
 
Sec. 225.92  How does an election by a foreign bank become effective?

    (a) In general. An election described in Sec. 225.91 is effective on 
the 31st day after the date that an election was received by the 
appropriate Federal Reserve Bank, unless the Board notifies the foreign 
bank or company prior to that time that:
    (1) The election is ineffective; or
    (2) The period is extended with the consent of the foreign bank or 
company making the election.
    (b) Earlier notification that an election is effective. The Board or 
the appropriate Federal Reserve Bank may notify a foreign bank or 
company that its election to be treated as a financial holding company 
is effective prior to the 31st day after the election was filed with the 
appropriate Federal Reserve Bank. Such notification must be in writing.
    (c) Under what circumstances will the Board find an election to be 
ineffective? An election to be treated as financial holding company 
shall not be effective

[[Page 118]]

if, during the period provided in paragraph (a) of this section, the 
Board finds that:
    (1) The foreign bank certificant, or any foreign bank that operates 
a branch or agency or owns or controls a commercial lending company in 
the United States and is controlled by a foreign company certificant, is 
not both well capitalized and well managed;
    (2) Any insured depository institution controlled by the foreign 
bank or company (except an institution excluded under paragraph (d) of 
this section) or any U.S. branch of a foreign bank that is insured by 
the Federal Deposit Insurance Corporation has not achieved at least a 
rating of ``satisfactory record of meeting community needs'' under 
Community Reinvestment Act at the institution's most recent examination;
    (3) Any U.S. depository institution subsidiary of the foreign bank 
or company is not both well capitalized and well managed; or
    (4) The Board does not have sufficient information to assess whether 
the foreign bank or company making the election meets the requirements 
of this subpart.
    (d) How is CRA performance of recently acquired insured depository 
institutions considered? An insured depository institution will be 
excluded for purposes of the review of CRA ratings described in 
paragraph (c)(2) of this section consistent with the provisions of 
Sec. 225.82(e).
    (e) Factors used in the Board's determination regarding 
comparability of capital and management. In determining whether a 
foreign bank is well capitalized and well managed in accordance with 
comparable capital and management standards, the Board will give due 
regard to national treatment and equality of competitive opportunity. In 
this regard, the Board may take into account the foreign bank's 
composition of capital, accounting standards, long-term debt ratings, 
reliance on government support to meet capital requirements, the extent 
to which the foreign bank is subject to comprehensive consolidated 
supervision, and other factors that may affect analysis of capital and 
management. The Board will consult with the home country supervisor for 
the foreign bank as appropriate.

[Reg. Y, 65 FR 15056, Mar. 21, 2000]