[Code of Federal Regulations]

[Title 12, Volume 6]

[Revised as of January 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 12CFR711.4]



[Page 524-525]

 

                       TITLE 12--BANKS AND BANKING

 

            CHAPTER VII--NATIONAL CREDIT UNION ADMINISTRATION

 

PART 711_MANAGEMENT OFFICIAL INTERLOCKS--Table of Contents

 

Sec. 711.4  Interlocking relationships permitted by statute.



    The prohibitions of Sec. 711.3 do not apply in the case of any one 

or more of the following organizations or to a subsidiary thereof:

    (a) A depository organization that has been placed formally in 

liquidation, or which is in the hands of a receiver, conservator, or 

other official exercising a similar function;

    (b) A corporation operating under section 25 or section 25A of the 

Federal Reserve Act (12 U.S.C. 601 et seq. and 12 U.S.C. 611 et seq., 

respectively) (Edge Corporations and Agreement Corporations);

    (c) A credit union being served by a management official of another 

credit union;

    (d) A depository organization that does not do business within the 

United States except as an incident to its activities outside the United 

States;

    (e) A State-chartered savings and loan guaranty corporation;

    (f) A Federal Home Loan Bank or any other bank organized solely to 

serve depository institutions (a bankers' bank) or solely for the 

purpose of providing securities clearing services and services related 

thereto for depository institutions and securities companies;

    (g) A depository organization that is closed or is in danger of 

closing as determined by the appropriate Federal depository institutions 

regulatory agency and is acquired by another depository organization. 

This exemption lasts for five years, beginning on the date the 

depository organization is acquired; and

    (h)(1) A diversified savings and loan holding company (as defined in 

section 10(a)(1)(F) of the Home Owners' Loan Act (12 U.S.C. 

1467a(a)(1)(F)) with respect to the service of a director of such 

company who also is a director of an unaffiliated depository 

organization if:

    (i) Both the diversified savings and loan holding company and the 

unaffiliated depository organization notify their appropriate Federal 

depository institutions regulatory agency at least 60 days before the 

dual service is proposed to begin; and

    (ii) The appropriate regulatory agency does not disapprove the dual 

service before the end of the 60-day period.

    (2) The NCUA Board or its designee may disapprove a notice of 

proposed service if it finds that:



[[Page 525]]



    (i) The service cannot be structured or limited so as to preclude an 

anticompetitive effect in financial services in any part of the United 

States;

    (ii) The service would lead to substantial conflicts of interest or 

unsafe or unsound practices; or

    (iii) The notificant failed to furnish all the information required 

by NCUA.

    (3) The NCUA Board or its designee may require that any interlock 

permitted under this paragraph (h) be terminated if a change in 

circumstances occurs with respect to one of the interlocked depository 

organizations that would have provided a basis for disapproval of the 

interlock during the notice period.