A banking organization may wish to involve some of its affiliates as participants in a particular transaction, but may find itself hindered by a U.S. statute that restricts and in some cases prohibits a U.S. bank from engaging in a transaction with its non-U.S. affiliate. This month’s column will provide a brief overview of these restrictions and prohibitions, known as Regulation W, focusing on those aspects more relevant to non-U.S. banks.
Legal Authority
Regulation W1 is derived from sections 23A and 23B of the U.S. Federal Reserve Act,2 which imposes quantitative and qualitative restrictions on a U.S. bank’s ability to do business with its affiliates. “Bank” in this context (and as used in this column) refers to a bank with insured deposits, any other institution that is a member of the Federal Reserve System (such as an uninsured national trust company) and, for limited purposes, U.S. branches and agencies of non-U.S. banks. The legislative intent was to protect the bank from losses arising from its transactions with its affiliates.
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.
For questions call 1-877-256-2472 or contact us at [email protected]
