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6.14 Restrictions on Transactions with Insiders

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6.14 Restrictions on Transactions with Insiders

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6.14.    Restrictions on Transactions with Insiders.


6.14.1.   Expanded Lending Limits to Insiders.  The statutory restrictions on extensions of credit to insiders implemented through the Fed's Regulation O will be expanded to take account of exposures arising from a derivative transaction, a repurchase agreement, reverse repurchase agreement, or a securities borrowing or lending transaction. This provision will become effective 1 year after the Transfer Date. [§614]

6.14.2.    Limitations on Purchases or Sales of Assets With Insiders.  The Act amends the FDI Act to provide that an insured depository institution may not purchase an asset from or sell an asset to an insider unless (i) the transaction is on market terms and, (ii) if the transaction involves more than 10 percent of the capital stock and surplus of the institution, there is an approval by a majority of the disinterested members of the board of directors of the institution.  This provision takes effect on the Transfer Date.  The Fed, in consultation with the OCC and FDIC, may adopt rules regarding this provision. [§ 615]