12 U.S.C. § 1432 — Incorporation of banks; corporate powers;

Page 306 TITLE 12—BANKS AND BANKING § 1432 1 So in original. in the judgment of at least 4 members of the board an emergency exists requiring such action’’ after ‘‘empow- ered to permit,’’, was executed by striking out ‘‘or whenever in the judgment of at least four members of the board an emergency exists requiring such action’’, as the probable intent of Congress. The amendment probably should also have struck out the comma after ‘‘empowered to permit’’ and the words ‘‘, to require,’’ after ‘‘such action’’. Pub. L. 101–73, § 701(b)(1), (3)(A), substituted ‘‘Board’’ for ‘‘board’’ wherever appearing. Subsec. (g). Pub. L. 101–73, § 710(b)(6), struck out ‘‘or nonmember borrowers’’ after ‘‘made to members’’ wherever appearing. Subsec. (h). Pub. L. 101–73, § 710(b)(6), struck out ‘‘or nonmember borrowers’’ after ‘‘advances to members’’. Pub. L. 101–73, § 701(b)(1), (3)(A), substituted ‘‘Board’’ for ‘‘board’’. Subsec. (i). Pub. L. 101–73, § 701(c)(2), inserted ‘‘Fed- eral’’ before ‘‘Home Loan Bank System’’. Pub. L. 101–73, § 701(b)(1), (2), substituted ‘‘Chair- person of the Board’’ for ‘‘Chairman of the Federal Home Loan Bank Board’’. Subsec. (k). Pub. L. 101–73, § 709(3), amended subsec. (k) generally. Prior to amendment, subsec. (k) read as follows: ‘‘The Federal Home Loan Banks are hereby au- thorized, as directed by the Board, to make loans to the Federal Savings and Loan Insurance Corporation. All such loans shall be made in accordance with the provi- sions of section 1725(d) of this title.’’ 1982—Subsec. (k). Pub. L. 97–320 added subsec. (k). 1980—Subsec. (e). Pub. L. 96–221 designated existing provisions as par. (1) and added par. (2). 1979—Subsec. (h). Pub. L. 96–153 inserted provisions relating to stock, obligations, or other securities of any small business investment company formed pursuant to section 681(d) of title 15, for the purpose of aiding mem- bers of the Federal Home Loan Bank System. 1974—Subsec. (h). Pub. L. 93–383 inserted reference to mortgages, obligations, or other securities sold by the Federal Home Loan Mortgage Corporation pursuant to section 1454 or 1455 of this title. Subsec. (i). Pub. L. 93–495 substituted ‘‘obligations under this paragraph’’ for ‘‘obligations under this sub- section’’ wherever appearing in fourth sentence of ini- tial par., in second par. substituted provisions author- izing purchase of obligations issued pursuant to this section in amounts not to exceed $2,000,000,000, for pro- visions relating to exercise of authority of this sub- section by the Secretary of the Treasury, and added third par. 1970—Subsec. (g). Pub. L. 91–609 substituted ‘‘five years’’ for ‘‘one year’’ in items (3) and (4). 1969—Subsec. (i). Pub. L. 91–151 increased the bor- rowing limit to $4,000,000,000 and made it a requirement that the rate charged on such borrowing be set at the current market yield on Treasury obligations and added a new paragraph which allows the Secretary to permit members of the Home Loan Bank System to continue to supply funds to the mortgage market dur- ing tight market conditions. 1968—Subsec. (h). Pub. L. 90–448 inserted ‘‘or the Gov- ernment National Mortgage Association, in the stock of the Federal National Mortgage Association’’. 1964—Subsec. (h). Pub. L. 88–560 substituted ‘‘in obli- gations, participations, or other instruments of or issued by the Federal National Mortgage Association’’ for ‘‘in obligations of the Federal National Mortgage Association’’. 1954—Subsec. (h). Act Aug. 2, 1954, inserted reference to obligations of the Federal National Mortgage Asso- ciation. 1950—Subsec. (g). Act June 27, 1950, § 3, struck out re- quirement that sums paid in on outstanding capital subscriptions of members from the base for deter- mining the amount of money which the Federal Home Loan Banks shall at all times have invested. Subsecs. (i), (j). Act June 27, 1950, § 4, added subsecs. (i) and (j). 1934—Subsecs. (i), (j). Act June 27, 1934, among other changes, struck out subsecs. (i) and (j). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2010 AMENDMENT Amendment by Pub. L. 111–203 effective 1 day after July 21, 2010, except as otherwise provided, see section 4 of Pub. L. 111–203, set out as an Effective Date note under section 5301 of this title. EFFECTIVE DATE OF 2006 AMENDMENT Amendment by Pub. L. 109–173 effective Mar. 31, 2006, see section 9(j) of Pub. L. 109–173, set out as a note under section 24 of this title. Amendment by Pub. L. 109–171 effective no later than the first day of the first calendar quarter that begins after the end of the 90-day period beginning Feb. 8, 2006, see section 2102(c) of Pub. L. 109–171, set out as a Merger of BIF and SAIF note under section 1821 of this title. EFFECTIVE DATE OF 1996 AMENDMENT Amendment by section 2704(d)(11)(A) of Pub. L. 104–208 effective Jan. 1, 1999, if no insured depository in- stitution is a savings association on that date, see sec- tion 2704(c) of Pub. L. 104–208, formerly set out as a note under section 1821 of this title. EFFECTIVE DATE OF 1968 AMENDMENT For effective date of amendment by title VIII of Pub. L. 90–448, see section 808 of Pub. L. 90–448, set out as an Effective Date note under section 1716b of this title. § 1432. Incorporation of banks; corporate powers; housing project loans (a) The directors of each Federal Home Loan Bank shall, in accordance with such rules and regulations as the Director may prescribe, make and file with the Director at the earliest prac- ticable date after the establishment of such bank, an organization certificate which shall contain such information as the Director may require. Upon the making and filing of such or- ganization certificate with the Director, such bank shall become, as of the date of the execu- tion of its organization certificate, a body cor- porate, and as such and in its name as des- ignated by the Director it shall have power to adopt, alter, and use a corporate seal; to make contracts; to purchase or lease and hold or dis- pose of such real estate as may be necessary or convenient for the transaction of its business; to sue and be sued, to complain and to defend, in any court of competent jurisdiction, State or Federal; to select, employ, and fix the com- pensation of such officers, employees, attorneys, and agents as shall be necessary for the trans- action of its business,; 1 to define their duties, require bonds of them and fix the penalties thereof, and to dismiss at pleasure such officers, employees, attorneys, and agents; and, by the board of directors of the bank, to prescribe, amend, and repeal by-laws governing the man- ner in which its affairs may be administered, consistent with applicable laws and regulations, as administered by the Director. No officer, em- ployee, attorney, or agent of a Federal home loan bank who receives compensation, may be a member of the board of directors. Each such bank shall have all such incidental powers, not inconsistent with the provisions of this chapter, as are customary and usual in corporations gen- erally. (b) Subject to such regulations as may be pre- scribed by the Director, one or more Federal Page 307 TITLE 12—BANKS AND BANKING § 1435 1 So in original. Word ‘‘in’’ probably should not appear. home loan banks may acquire, hold, or dispose of, in whole or in part, or facilitate such acquisi- tion, holding, or disposition by members of any such bank of, housing project loans, or interests therein, having the benefit of any guaranty under section 2181 of title 22, as now or hereafter in effect, or loans, or interests therein, having the benefit of any guaranty under section 2184 of title 22 or any commitment or agreement with respect to such loans, or interests therein, made pursuant to either of such sections. This author- ity extends to the acquisition, holding, and dis- position of loans, or interests therein, having the benefit of any guaranty under section 2181 or 2182 of title 22 or such sections as hereafter amended or extended, or of any commitment or agreement for any such guaranty. (July 22, 1932, ch. 522, § 12, 47 Stat. 735; Pub. L. 89–754, title X, § 1016(a), Nov. 3, 1966, 80 Stat. 1293; Pub. L. 90–448, title XVII, § 1717, Aug. 1, 1968, 82 Stat. 609; Pub. L. 91–609, title IX, § 907(a), Dec. 31, 1970, 84 Stat. 1811; Pub. L. 101–73, title VII, § 701(b)(1), (3)(A), Aug. 9, 1989, 103 Stat. 412; Pub. L. 106–102, title VI, § 606(d), Nov. 12, 1999, 113 Stat. 1454; Pub. L. 110–289, div. A, title II, § 1204(8), (10), July 30, 2008, 122 Stat. 2786.) Editorial Notes REFERENCES IN TEXT Section 2184 of title 22, referred to in subsec. (b), which related to housing projects in Latin American countries, was omitted in the general amendment made by section 105 of Pub. L. 91–175, Dec. 30, 1969, 83 Stat. 807. See section 2182 of Title 22, Foreign Relations and Intercourse. AMENDMENTS 2008—Subsec. (a). Pub. L. 110–289 substituted ‘‘admin- istered by the Director’’ for ‘‘administered by the Fi- nance Board’’ and ‘‘the Director’’ for ‘‘the Board’’ wher- ever appearing. Subsec. (b). Pub. L. 110–289, § 1204(8), substituted ‘‘the Director’’ for ‘‘the Board’’. 1999—Subsec. (a). Pub. L. 106–102, § 606(d)(1), struck out ‘‘, but, except with the prior approval of the Board, no bank building shall be bought or erected to house any such bank, or leased by such bank under any lease for such purpose which has a term of more than ten years’’ after ‘‘convenient for the transaction of its busi- ness’’, struck out ‘‘subject to the approval of the Board’’ after ‘‘necessary for the transaction of its busi- ness’’, substituted ‘‘and, by the board of directors of the bank, to prescribe, amend, and repeal by-laws gov- erning the manner in which its affairs may be adminis- tered, consistent with applicable laws and regulations, as administered by the Finance Board. No officer, em- ployee, attorney, or agent of a Federal home loan bank’’ for ‘‘and, by its Board of directors, to prescribe, amend, and repeal bylaws, rules, and regulations gov- erning the manner in which its affairs may be adminis- tered; and the powers granted to it by law may be exer- cised and enjoyed subject to the approval of the Board. The president of a Federal Home Loan Bank may also be a member of the Board of directors thereof, but no other officer, employee, attorney, or agent of such bank,’’, and, in penultimate sentence, substituted ‘‘board of directors’’ for ‘‘Board of directors’’ after ‘‘may be a member of the’’. Subsec. (b). Pub. L. 106–102, § 606(d)(2), substituted ‘‘Federal home loan banks’’ for ‘‘Federal home loans banks’’. 1989—Subsec. (a). Pub. L. 101–73 substituted ‘‘Board’’ for ‘‘board’’ wherever appearing. 1970—Subsec. (b). Pub. L. 91–609 extended authority to make housing project loans to acquisition, holding, and disposition of loans, or interest therein, having benefit of any guaranty under section 2181 or 2182 of title 22 or such sections as hereafter amended or extended, or of any commitment or agreement for any such guaranty. 1968—Pub. L. 90–448 designated existing provisions as subsec. (a) and added subsec. (b). 1966—Pub. L. 89–754 substituted ‘‘but, except with the prior approval of the board, no bank building shall be bought or erected to house any such bank, or leased by such bank under any lease’’ for ‘‘but no bank building shall be bought or erected to house any such bank, nor shall any such bank make any lease’’ in second sen- tence. § 1433. Exemption from taxation; obligations ac- ceptable as credit on debt of home owner Any and all notes, debentures, bonds, and other such obligations issued by any bank, and consolidated Federal Home Loan Bank bonds and debentures, shall be exempt both as to prin- cipal and interest from all taxation (except surtaxes, estate, inheritance, and gift taxes) now or hereafter imposed by the United States, by any Territory, dependency, or possession thereof, or by any State, county, municipality, or local taxing authority. The bank, including its franchise, its capital, reserves, and surplus, its advances, and its income, shall be exempt from all taxation now or hereafter imposed by the United States, by any Territory, depend- ency, or possession thereof, or by any State, county, municipality, or local taxing authority; except that in 1 any real property of the bank shall be subject to State, Territorial, county, municipal, or local taxation to the same extent according to its value as other real property is taxed. The notes, debentures, and bonds issued by any bank, with unearned coupons attached, shall be accepted at par by such bank in pay- ment of or as a credit against the obligation of any home-owner debtor of such bank. (July 22, 1932, ch. 522, § 13, 47 Stat. 735; May 28, 1935, ch. 150, § 8, 49 Stat. 295.) Editorial Notes AMENDMENTS 1935—Act May 28, 1935, inserted ‘‘and consolidated Federal Home Loan Bank bonds and debentures’’ in first sentence. § 1434. Depositaries of public money; financial agents When designated for that purpose by the Sec- retary of the Treasury, each Federal Home Loan Bank shall be a depositary of public money, ex- cept receipts from customs, under such regula- tions as may be prescribed by said Secretary; and it may also be employed as a financial agent of the Government; and it shall perform all such reasonable duties as depositary of public money and financial agent of the Government as may be required of it. (July 22, 1932, ch. 522, § 14, 47 Stat. 736.) § 1435. Obligations as lawful investments; liabil- ity of United States for debentures, etc., issued by banks Obligations of the Federal Home Loan Banks issued with the approval of the Board or the Di-