12 U.S.C. § 371b — Rate of interest on time deposits; pay-

Page 139 TITLE 12—BANKS AND BANKING § 371b Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1982 AMENDMENT Pub. L. 97–320, title IV, § 403(c), Oct. 15, 1982, 96 Stat. 1511, provided that: ‘‘This section [amending this sec- tion and section 92 of this title] shall take effect upon the expiration of one hundred and eighty days after the date of its enactment [Oct. 15, 1982].’’ REPEALS Repealing provisions of Consolidated Farmers Home Administration Act of 1961 as not having the effect of repealing the amendments to this section enacted by act July 22, 1937, § 15(a), as added Aug. 14, 1946, and Aug. 28, 1937, § 10(f), as added Aug. 17, 1954, see section 341(a) of Pub. L. 87–128, title III, Aug. 8, 1961, 75 Stat. 318, set out as a References in Other Laws note under section 1921 of Title 7, Agriculture. Executive Documents EXCEPTION AS TO TRANSFER OF FUNCTIONS Functions vested by any provision of law in Comp- troller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under section 1 of this title. § 371a. Repealed. Pub. L. 111–203, title VI, § 627(a)(1), July 21, 2010, 124 Stat. 1640 Section, act Dec. 23, 1913, ch. 6, § 19(i), formerly § 19 par. (12), as added June 16, 1933, ch. 89, § 11(b), 48 Stat. 181; amended Aug. 23, 1935, ch. 614, title III, § 324(c), 49 Stat. 714; Proc. No. 2695, eff. July 4, 1946, 11 F.R. 7517, 60 Stat. 1352; renumbered § 19(i), Pub. L. 89–597, § 2(b), Sept. 21, 1966, 80 Stat. 824; Pub. L. 96–161, title I, § 101(a), Dec. 28, 1979, 93 Stat. 1233; Pub. L. 96–221, title III, §§ 302(a), 307, Mar. 31, 1980, 94 Stat. 145, 147, prohibited member banks from paying interest on any deposit payable on demand but included savings provisions and exceptions. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF REPEAL Pub. L. 111–203, title VI, § 627(b), July 21, 2010, 124 Stat. 1640, provided that: ‘‘The amendments made by subsection (a) [amending sections 1464 and 1828 of this title and repealing this section] shall take effect 1 year after the date of the enactment of this Act [July 21, 2010].’’ § 371b. Rate of interest on time deposits; pay- ment of time deposits before maturity; waiv- er of notice requirements for withdrawal of savings deposits The Board may from time to time, after con- sulting with the Board of Directors of the Fed- eral Deposit Insurance Corporation and the Fed- eral Home Loan Bank Board, prescribe rules governing the advertisement of interest on de- posits by member banks on time and savings de- posits. The provisions of this section shall not apply to any deposit which is payable only at an office of a member bank located outside of the States of the United States and the District of Columbia. During the period commencing on Oc- tober 15, 1962, and ending on October 15, 1968, the provisions of this paragraph shall not apply to the rate of interest which may be paid by mem- ber banks on time deposits of foreign govern- ments, monetary and financial authorities of foreign governments when acting as such, or international financial institutions of which the United States is a member. (Dec. 23, 1913, ch. 6, § 19(j), formerly § 19 (par. 13), as added June 16, 1933, ch. 89, § 11(b), 48 Stat. 182; amended Aug. 23, 1935, ch. 614, title III, § 324(c), 49 Stat. 714; Pub. L. 87–827, § 1, Oct. 15, 1962, 76 Stat. 953; Pub. L. 89–79, § 1, July 21, 1965, 79 Stat. 244; renumbered § 19(j) and amended Pub. L. 89–597, § 2(b), (c), Sept. 21, 1966, 80 Stat. 824; Pub. L. 90–505, § 2(a), Sept. 21, 1968, 82 Stat. 856; Pub. L. 96–221, title II, § 207(b)(4)–(6), Mar. 31, 1980, 94 Stat. 144.) Editorial Notes AMENDMENTS 1980—Pub. L. 96–221 struck out provisions relating to payment of interest on deposits, prescribing of dif- ferent limitations by the Board for different classes of deposits, and payment of time deposits before matu- rity. 1968—Pub. L. 90–505 gave Board power to prescribe rules governing the payment and advertising of inter- est on deposits. 1966—Pub. L. 89–597, § 2(c), made authority of Board to prescribe maximum permissible rates of interest that may be paid by member banks on time and savings de- posits discretionary rather than mandatory, required prior consultations with the FDIC Board and the FHLB Board, authorized different rate limitations for dif- ferent classes of deposits, for deposits of different amounts, or according to such other reasonable bases as the Board may deem desirable in the public interest, and struck out provision for rate limitation according to the varying discount rates of member banks in the several Federal Reserve districts. 1965—Pub. L. 89–79 extended until Oct. 15, 1968, the pe- riod during which the provisions of this paragraph do not apply to the rate of interest payable by member banks on time deposits of foreign governments, mone- tary and financial authorities of foreign governments when acting as such, or international financial institu- tions of which the United States is a member. 1962—Pub. L. 87–827 inserted sentence making this paragraph inapplicable, during the period commencing on October 15, 1962, and ending upon the expiration of three years after such date, to the rate of interest which may be paid by member banks on time deposits of foreign governments, monetary and financial au- thorities of foreign governments when acting as such, or international financial institutions of which the United States is a member. 1935—Act Aug. 23, 1935, among other changes, inserted ‘‘except upon such conditions and in accordance with such rules and regulations as may be prescribed by the said Board’’ to second sentence and proviso. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1980 AMENDMENT Pub. L. 96–221, title II, § 207(b), Mar. 31, 1980, 94 Stat. 144, provided in part that the amendment made by that section is effective 6 years after Mar. 31, 1980. EFFECTIVE AND TERMINATION DATES OF 1966 AMENDMENT Pub. L. 89–597, § 7, Sept. 21, 1966, 80 Stat. 825, as amended, formerly set out as an Effective and Termi- nation Dates of 1966 Amendment note under section 461 of this title (which provided in part that amendment of this section by section 2(c) of Pub. L. 89–597 was effec- tive only to Dec. 15, 1980, and that on Dec. 15, 1980, this section was amended to read as it would without the amendment by section 2(c) of Pub. L. 89–597), was re- pealed by Pub. L. 96–221, title II, § 207(a), Mar. 31, 1980, 94 Stat. 144. TRANSFER OF FUNCTIONS Federal Home Loan Bank Board abolished and func- tions transferred, see sections 401 to 406 of Pub. L. 101–73, set out as a note under section 1437 of this title. Page 140 TITLE 12—BANKS AND BANKING § 371b–1 TIME DEPOSITS; INTEREST RATES, LIMITATION Pub. L. 93–123, Oct. 15, 1973, 87 Stat. 448, provided that in carrying out the Act of September 21, 1966 (Pub. L. 89–597) [enacting section 1425b of this title, amending sections 355, 371b, 461, and 1828 of this title and section 771 of former Title 31, repealing section 462a–1 of this title, and enacting provisions set out as notes under section 461 of this title] and other provisions of law, the Secretary of the Treasury, the Board of Governors of the Federal Reserve System, the Board of Directors of the Federal Deposit Insurance Corporation, and the Federal Home Loan Bank Board take action to limit rates of interest or dividends paid on time deposits of less than $100,000 by institutions regulated by them, prior to repeal by Pub. L. 96–221, title II, § 207(b)(13), Mar. 31, 1980, 94 Stat. 144, eff. 6 years after Mar. 31, 1980. § 371b–1. Repealed. Pub. L. 96–221, title V, § 529, Mar. 31, 1980, 94 Stat. 168 Section, act Dec. 23, 1913, ch. 6, § 19(k), as added Dec. 28, 1979, Pub. L. 96–161, title II, § 208, 93 Stat. 1238, pro- vided that no member bank or affiliate thereof, or any successor or assignee of such member bank or affiliate or any endorser, guarantor, or surety of such member bank or affiliate could plead, raise, or claim directly or by counterclaim, setoff, or otherwise, with respect to any deposit or obligation of such member bank or affil- iate, any defense, right, or benefit under any provision of a statute or constitution of a State or of a territory of the United States, or of any law of the District of Columbia, regulating or limiting the rate of interest which could be charged, taken, received, or reserved, that any such provision was preempted, and that no civil or criminal penalty which would otherwise have been applicable under such provision would apply to such member bank or affiliate or to any other person. Editorial Notes PRIOR PROVISIONS A prior section 371b–1, act Dec. 23, 1913, ch. 6, § 19(k), as added Nov. 5, 1979, Pub. L. 96–104, title II, § 201, 93 Stat. 792, identical to this section as added by Pub. L. 96–161, was repealed by section 212 of Pub. L. 96–161, ef- fective at the close of Dec. 27, 1979, except that its pro- visions would continue to apply to deposits made or ob- ligations issued in any State on or after Nov. 5, 1979, but prior to such repeal. See Effective Date of 1979 Amendment note set out below. A prior section 371b–1, act Dec. 23, 1913, ch. 6, § 19(k), as added Oct. 29, 1974, Pub. L. 93–501, title III, § 301, 88 Stat. 1560, identical to this section as added by Pub. L. 96–104, was repealed by section 1 of Pub. L. 96–104 except that its provisions shall continue to apply to any de- posit made or obligation issued in any State during the period specified in section 304 of Pub. L. 93–501. See Ef- fective and Termination Date of 1974 Amendment note set out below. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF REPEAL Pub. L. 96–221, title V, § 529, Mar. 31, 1980, 94 Stat. 168, provided in part that the repeal of this section is effec- tive at the close of Mar. 31, 1980. SAVINGS PROVISION Pub. L. 96–221, title V, § 529, Mar. 31, 1980, 94 Stat. 168, provided in part that, notwithstanding the repeal of Pub. L. 96–104 and title II of Pub. L. 96–161, this section [which had been enacted by those laws] shall continue to apply to any loan made, any deposit made, or any obligation issued in any State during any period when this section was in effect in such State. EFFECTIVE DATE OF 1979 AMENDMENTS Prior to repeal by Pub. L. 96–221, title V, § 529, Mar. 31, 1980, 94 Stat. 168, it was provided by Pub. L. 96–161, title II, § 211, Dec. 28, 1979, 93 Stat. 1239, that: ‘‘The amendments made by sections 208, 209, and 210 of this title [enacting this section and amending sections 1425b and 1828 of this title] shall apply only with respect to deposits made or obligations issued in any State during the period beginning on the date of the enactment of this Act [Dec. 28, 1979] and ending on the earliest of— ‘‘(1) in the case of a State statute, July 1, 1980; ‘‘(2) the date, after the date of the enactment of this Act [Dec. 28, 1979], on which such State adopts a law stating in substance that such State does not want the amendments made by sections 208, 209, and 210 of this title to apply with respect to such deposits and obligations; or ‘‘(3) the date on which such State certifies that the voters of such State, after the date of the enactment of this Act [Dec. 28, 1979], have voted in favor of, or to retain, any law, provision of the constitution of such state, or amendment to the constitution of such State which limits the amount of interest which may be charged in connection with such deposits and obli- gations.’’ Prior to its repeal by Pub. L. 96–161, title II, § 212, Dec. 28, 1979, 93 Stat. 1239, it was provided by Pub. L. 96–104, title II, § 204, Nov. 5, 1979, 93 Stat. 793, that: ‘‘The amendments made by this title [enacting this section and amending sections 1425b and 1828 of this title] shall apply only with respect to deposits made or obligations issued in any State during the period beginning on the date of the enactment of this Act [Nov. 5, 1979] and end- ing on the earlier of— ‘‘(1) July 1, 1981; ‘‘(2) the date, after the date of the enactment of this Act [Nov. 5, 1979], on which such State adopts a law stating in substance that such State does not want the amendments made by this title to apply with respect to such deposits and obligations; or ‘‘(3) the date on which such State certifies that the voters of such State, after the date of the enactment of this Act [Nov. 5, 1979], have voted in favor of, or to retain, any law, provision of the constitution of such State, or amendment to the constitution of such State which limits the amount of interest which may be charged in connection with such deposits and obli- gations.’’ EFFECTIVE AND TERMINATION DATES OF 1974 AMENDMENT Prior to repeal by Pub. L. 96–104, § 1, Nov. 5, 1979, 93 Stat. 789, it was provided by Pub. L. 93–501, title III, § 304, Oct. 29, 1974, 88 Stat. 1561, that: ‘‘The amendments made by this title [which enacted this section and amended sections 1425b and 1828 of this title] shall apply to any deposit made or obligation issued in any State after the date of enactment of this title [Oct. 29, 1974], but prior to the earlier of (1) July 1, 1977 or (2) the date (after such date of enactment) on which the State enacts a provision of law which limits the amount of interest which may be charged in connection with de- posits or obligations referred to in the amendments made by this title.’’ STATES HAVING CONSTITUTIONAL PROVISIONS REGARDING MAXIMUM INTEREST RATES Pub. L. 96–161, title II, § 213, Dec. 28, 1979, 93 Stat. 1240, provided that the provisions of title II of Pub. L. 96–161, which enacted this section, repealed former section 371b–1 of this title, and enacted provisions set out as a note under this section, continued to apply until July 1, 1981, in the case of any State having a constitutional provision regarding maximum interest rates. § 371b–2. Interbank liabilities (a) Purpose The purpose of this section is to limit the risks that the failure of a large depository insti- tution (whether or not that institution is an in- sured depository institution) would pose to in- sured depository institutions.