Archive

REGULATION O MODIFIED FOR PPP LOANS

On April 17 the Federal Reserve Board published an interim final rule that excludes loans that are guaranteed under the Small Business Administration’s Paycheck Protection Program (PPP) from many of the requirements of Regulation O. The rule is effective upon publication in the Federal Register, which is expected soon. The comment period expires 45 days after publication in the Federal Register. The final rule excludes from all requirements of Regulation O, except for the executive […]

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OTTING MISSTATEMENT

Last week Comptroller of the Currency Joseph M. Otting issued a statement after meeting with Mick Mulvaney, Acting Director of the Consumer Financial Protection Bureau. According to the news release (NR 2018-14) from the Office of the Comptroller of the Currency (OCC)  Comptroller Otting stated “Acting Director Mulvaney has helped reduce the burden on the banking system by delaying implementation of his agency’s Home Mortgage Disclosure Act rule, committing to reconsider its payday lending rule, and […]

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REGULATION O – LENDING TO INSIDERS

Congress enacted the Financial Institutions Regulatory and Interest Control Act in 1978. The insider lending provisions of the law were implemented as Regulation O. Historical data show that insider abuse is at the heart of many bank failures. Examiners take very seriously their mission to prevent insider abuse. They frequently cite violations of Regulation O during examinations, and often take enforcement action. Enforcement actions may take the form of civil monetary penalties , a Memorandum of […]

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DODD-FRANK CHANGES TO REGULATION O

The Dodd-Frank Act contains over 2,000 pages of law. One page buried deep within the massive law has made two changes that impact Regulation O, the regulation that limits lending to insiders. The laws upon which Regulation O is based have been changed; the regulation itself has not been changed yet. The first change expands the definition of “extension of credit,” to include extending credit to a person and having credit exposure to the person […]

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