12 U.S.C. § 1825 — Issuance of notes, debentures, bonds, and

Page 1104 TITLE 12—BANKS AND BANKING § 1825 are employed therefor. There are hereby appropriated to the Secretary, for fiscal year 1989 and each fiscal year thereafter, such sums as may be necessary to carry out this section.’’ Statutory Notes and Related Subsidiaries CHANGE OF NAME Committee on Banking, Finance and Urban Affairs of House of Representatives treated as referring to Com- mittee on Banking and Financial Services of House of Representatives by section 1(a) of Pub. L. 104–14, set out as a note preceding section 21 of Title 2, The Con- gress. Committee on Banking and Financial Services of House of Representatives abolished and replaced by Committee on Financial Services of House of Rep- resentatives, and jurisdiction over matters relating to securities and exchanges and insurance generally trans- ferred from Committee on Energy and Commerce of House of Representatives by House Resolution No. 5, One Hundred Seventh Congress, Jan. 3, 2001. EFFECTIVE DATE OF 2006 AMENDMENT Amendment by Pub. L. 109–173 effective Mar. 31, 2006, see section 8(b) of Pub. L. 109–173, set out as a note under section 1813 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 Pub. L. 104–208 effective Jan. 1, 1999, if no insured depository institution is a savings asso- ciation on that date, see section 2704(c) of Pub. L. 104–208, formerly set out as a note under section 1821 of this title. EFFECTIVE DATE OF 1992 AMENDMENT Amendment by Pub. L. 102–550 effective as if included in the Federal Deposit Insurance Corporation Improve- ment Act of 1991, Pub. L. 102–242, as of Dec. 19, 1991, see section 1609(a) of Pub. L. 102–550, set out as a note under section 191 of this title. RETIREMENT AND CANCELLATION OF CAPITAL STOCK; PAYMENTS OF CAPITAL AND SURPLUS TO SECRETARY OF THE TREASURY Act Aug. 5, 1947, ch. 492, § 1, 61 Stat. 773, directed the Federal Deposit Insurance Corporation to retire its capital stock by paying the amount received therefor (whether received from the Secretary of the Treasury or the Federal Reserve banks) to the Secretary of the Treasury, to be covered into the Treasury as miscella- neous receipts, with the Corporation to pay to the Sec- retary so much of its capital and surplus as is in excess of $1,000,000,000, the balance of the amount to be paid to the Secretary in units of $10,000,000 except that the last unit to be paid could be less than $10,000,000. § 1825. Issuance of notes, debentures, bonds, and other obligations; exemptions (a) General rule All notes, debentures, bonds, or other such ob- ligations issued by the Corporation shall be ex- empt, both as to principal and interest, from all taxation (except estate and inheritance 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: Provided, That inter- est upon or any income from any such obliga- tions and gain from the sale or other disposition of such obligations shall not have any exemp- tion, as such, and loss from the sale or other dis- position of such obligations shall not have any special treatment, as such, under the Internal Revenue Code, or laws amendatory or supple- mentary thereto. The Corporation, including its franchise, its capital, reserves, and surplus, and its income, shall be exempt from all taxation 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, except that any real property of the Corporation 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. (b) Other exemptions When acting as a receiver, the following provi- sions shall apply with respect to the Corpora- tion: (1) The Corporation including its franchise, its capital, reserves, and surplus, and its in- come, shall be exempt from all taxation im- posed by any State, county, municipality, or local taxing authority, except that any real property of the Corporation 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, except that, notwithstanding the failure of any per- son to challenge an assessment under State law of such property’s value, such value, and the tax thereon, shall be determined as of the period for which such tax is imposed. (2) No property of the Corporation shall be subject to levy, attachment, garnishment, foreclosure, or sale without the consent of the Corporation, nor shall any involuntary lien at- tach to the property of the Corporation. (3) The Corporation shall not be liable for any amounts in the nature of penalties or fines, including those arising from the failure of any person to pay any real property, per- sonal property, probate, or recording tax or any recording or filing fees when due. (4) EXEMPTION FROM CRIMINAL PROSECUTION.— The Corporation shall be exempt from all pros- ecution by the United States or any State, county, municipality, or local authority for any criminal offense arising under Federal, State, county, municipal, or local law, which was allegedly committed by the institution, or persons acting on behalf of the institution, prior to the appointment of the Corporation as receiver. This subsection shall not apply with respect to any tax imposed (or other amount arising) under the Internal Revenue Code of 1986. (c) Limitation on borrowing (1) Cost estimate for outstanding obligations, guarantees, and liabilities As soon as practicable after August 9, 1989, the Corporation shall estimate the aggregate cost to the Corporation for all outstanding ob- ligations and guarantees of the Corporation which were issued, and all outstanding liabil- ities which were incurred, by the Corporation before August 9, 1989. Page 1105 TITLE 12—BANKS AND BANKING § 1825 (2) Estimate of notes and other obligations re- quired Before issuing an obligation or making a guarantee, the Corporation shall estimate the cost of such obligations or guarantees. (3) Inclusion of estimates in financial state- ments The Corporation shall— (A) reflect in its financial statements the estimates made by the Corporation under paragraphs (1) and (2) of the aggregate amount of the costs to the Corporation for outstanding obligations and other liabilities, and (B) make such adjustments as are appro- priate in the estimate of such aggregate amount not less frequently than quarterly. (4) Estimate of other assets required The Corporation shall— (A) estimate the market value of assets held by it as a result of case resolution ac- tivities, with a reduction for expenses ex- pected to be incurred by the Corporation in connection with the management and sale of such assets; (B) reflect the amounts so estimated in its financial statements; and (C) make such adjustments as are appro- priate of such market value not less than quarterly. (5) Maximum amount limitation on out- standing obligations Notwithstanding any other provisions of this chapter, the Corporation may not issue or incur any obligation, if, after issuing or incur- ring the obligation, the aggregate amount of obligations of the Deposit Insurance Fund, outstanding would exceed the sum of— (A) the amount of cash or the equivalent of cash held by the Deposit Insurance Fund; (B) the amount which is equal to 90 per- cent of the Corporation’s estimate of the fair market value of assets held by the Deposit Insurance Fund, other than assets described in subparagraph (A); and (C) the total of the amounts authorized to be borrowed from the Secretary of the Treasury pursuant to section 1824(a) of this title. (6) ‘‘Obligation’’ defined (A) In general For purposes of paragraph (5), the term ‘‘obligation’’ includes— (i) any guarantee issued by the Corpora- tion, other than deposit guarantees; (ii) any amount borrowed pursuant to section 1824 of this title; and (iii) any other obligation for which the Corporation has a direct or contingent li- ability to pay any amount. (B) Valuation of contingent liabilities The Corporation shall value any contin- gent liability at its expected cost to the Cor- poration. (d) Full faith and credit The full faith and credit of the United States is pledged to the payment of any obligation issued after August 9, 1989, by the Corporation, with respect to both principal and interest, if— (1) the principal amount of such obligation is stated in the obligation; and (2) the term to maturity or the date of matu- rity of such obligation is stated in the obliga- tion. (Sept. 21, 1950, ch. 967, § 2[15], 64 Stat. 890; Pub. L. 101–73, title II, § 219, Aug. 9, 1989, 103 Stat. 261; Pub. L. 102–242, title I, § 102(a), (c), Dec. 19, 1991, 105 Stat. 2236, 2237; Pub. L. 103–325, title VI, § 602(a)(43), Sept. 23, 1994, 108 Stat. 2290; Pub. L. 104–208, div. A, title II, § 2704(d)(14)(R), Sept. 30, 1996, 110 Stat. 3009–493; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 8(a)(25), Feb. 15, 2006, 119 Stat. 3614; Pub. L. 109–351, title VII, § 720(a), Oct. 13, 2006, 120 Stat. 1998.) Editorial Notes REFERENCES IN TEXT The Internal Revenue Code, referred to in subsecs. (a) and (b), is classified to Title 26, Internal Revenue Code. PRIOR PROVISIONS Section is derived from subsec. (p) of former section 264 of this title. See Codification note set out under section 1811 of this title. AMENDMENTS 2006—Subsec. (b)(4). Pub. L. 109–351 added par. (4). Subsec. (c)(5). Pub. L. 109–173 substituted ‘‘the De- posit Insurance Fund’’ for ‘‘the Bank Insurance Fund or Savings Association Insurance Fund, respectively’’ in introductory provisions and in subpar. (A) and ‘‘the De- posit Insurance Fund’’ for ‘‘the Bank Insurance Fund or the Savings Association Insurance Fund, respectively’’ in subpar. (B). Pub. L. 109–171 repealed Pub. L. 104–208, § 2704(d)(14)(R). See 1996 Amendment note below. 1996—Subsec. (c)(5). Pub. L. 104–208, § 2704(D)(14)(R), which directed substitution of ‘‘the Deposit Insurance Fund’’ for ‘‘the Bank Insurance Fund or Savings Asso- ciation Insurance Fund, respectively’’ in introductory provisions and in subpar. (A) and ‘‘the Deposit Insur- ance Fund’’ for ‘‘the Bank Insurance Fund or the Sav- ings Association Insurance Fund, respectively’’ in sub- par. (B), was repealed by Pub. L. 109–171. See Effective Date of 1996 Amendment note below and 2006 Amend- ment note above. 1994—Subsec. (c)(1). Pub. L. 103–325 substituted ‘‘OBLI- GATIONS, GUARANTEES, AND LIABILITIES’’ for ‘‘OBLIGA- TIONS LIABILITIES’’ in heading. 1991—Subsec. (c)(5), (6). Pub. L. 102–242, § 102(a), added pars. (5) and (6) and struck out former par. (5) which provided for a 10-percent-minimum net worth require- ment for Bank Insurance Fund or Savings Association Insurance Fund and former par. (6) which provided ex- ception for up to $5,000,000,000 in additional liabilities beyond limitations of par. (5). Subsec. (c)(7). Pub. L. 102–242, § 102(c), struck out par. (7) which provided for calculation of net worth and asset valuation of Bank Insurance Fund and the Sav- ings Association Insurance Fund for purposes of par. (5). 1989—Subsec. (a). Pub. L. 101–73 designated existing provision as subsec. (a), inserted heading, and added subsecs. (b) to (d). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2006 AMENDMENT Amendment by Pub. L. 109–173 effective Mar. 31, 2006, see section 8(b) of Pub. L. 109–173, set out as a note under section 1813 of this title. Page 1106 TITLE 12—BANKS AND BANKING § 1826 1 See References in Text note below. 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 Pub. L. 104–208 effective Jan. 1, 1999, if no insured depository institution is a savings asso- ciation on that date, see section 2704(c) of Pub. L. 104–208, formerly set out as a note under section 1821 of this title. GAO REPORTS Pub. L. 102–242, title I, § 102(b), Dec. 19, 1991, 105 Stat. 2237, as amended by Pub. L. 103–325, title III, § 327, Sept. 23, 1994, 108 Stat. 2230; Pub. L. 104–66, title II, § 2061, Dec. 21, 1995, 109 Stat. 729, directed Comptroller General to submit report to congressional committees, not later than 90 days after end of any calendar quarter in which Federal Deposit Insurance Corporation had any out- standing obligations pursuant to section 1824 of this title, on Corporation’s compliance at the end of that quarter with subsec. (c) of this section, prior to repeal by Pub. L. 104–316, title I, § 106(c), Oct. 19, 1996, 110 Stat. 3831. § 1826. Forms of obligations; preparation by Sec- retary of the Treasury In order that the Corporation may be supplied with such forms of notes, debentures, bonds, or other such obligations as it may need for issuance under this chapter, the Secretary of the Treasury is authorized to prepare such forms as shall be suitable and approved by the Cor- poration, to be held in the Treasury subject to delivery, upon order of the Corporation. The en- graved plates, dies, bed pieces, and other mate- rial executed in connection therewith shall re- main in the custody of the Secretary of the Treasury. The Corporation shall reimburse the Secretary of the Treasury for any expenses in- curred in the preparation, custody, and delivery of such notes, debentures, bonds, or other such obligations. (Sept. 21, 1950, ch. 967, § 2[16], 64 Stat. 890.) Editorial Notes PRIOR PROVISIONS Section is derived from subsec. (q) of former section 264 of this title. See Codification note set out under section 1811 of this title. § 1827. Reports by Corporation; audit of financial transactions; report on audits; employment of certified public accountants for audits (a) Annual reports on the Deposit Insurance Fund and the FSLIC Resolution Fund (1) In general The Corporation shall annually submit a full report of its operations, activities, budget, re- ceipts, and expenditures for the preceding 12- month period. The report shall include, with respect to the Deposit Insurance Fund and the FSLIC Resolution Fund, an analysis by the Corporation of— (A) the current financial condition of each such fund; (B) the purpose, effect, and estimated cost of each resolution action taken for an in- sured depository institution during the pre- ceding year; (C) the extent to which the actual costs of assistance provided to, or for the benefit of, an insured depository institution during the preceding year exceeded the estimated costs of such assistance reported in a previous year under paragraph (A); (D) the exposure of the Deposit Insurance Fund to changes in those economic factors most likely to affect the condition of that fund; (E) a current estimate of the resources needed for the Deposit Insurance Fund or the FSLIC Resolution Fund to achieve the purposes of this chapter; and (F) any findings, conclusions, and rec- ommendations for legislative and adminis- trative actions considered appropriate to fu- ture resolution activities by the Corpora- tion. (2) Manner of submission Such report shall be submitted to the Presi- dent of the Senate and the Speaker of the House of Representatives, who shall cause the same to be printed for the information of Con- gress, and the President as soon as practicable after the first day of January each year. (3) Coordination with other report require- ments The report required under this subsection shall include the report required under section 57a(f)(7) 1 of title 15. (b) Quarterly reports to Treasury (1) Financial operating plans and forecasts Before the beginning of each fiscal quarter, the Corporation shall provide to the Secretary of the Treasury a copy of the Corporation’s fi- nancial operating plans and forecasts. (2) Financial condition and reports of oper- ations As soon as practicable after the end of each fiscal quarter, the Corporation shall submit to the Secretary of the Treasury a copy of the re- port of the Corporation’s financial condition as of the end of such fiscal quarter and the re- sults of the Corporation’s operations during such fiscal quarter. (3) Items to be included The plans, forecasts, and reports required under this subsection shall reflect the esti- mates required to be made under section 1825(b) of this title of the liabilities and obli- gations of the Corporation described in such section. (4) Rule of construction The requirement to provide plans, forecasts, and reports to the Secretary of the Treasury under this subsection may not be construed as implying any obligation on the part of the Corporation to obtain the consent or approval of such Secretary with respect to such plans, forecasts, and reports. (c) Reports to OMB (1) Financial information The Corporation shall continue to provide to the Director of the Office of Management and