---
kind: "section"
citation: "12 C.F.R. § 225.1"
title: "12"
number: "225.1"
heading: "Authority, purpose, and scope."
url: "https://uscodex.org/cfr/12/225.1"
---

# §225.1. Authority, purpose, and scope.

- (a) **Authority.** This part 1 (Regulation Y) is issued by the Board of Governors of the Federal Reserve System (Board) under section 5(b) of the Bank Holding Company Act of 1956, as amended ([12 U.S.C. 1844(b)](/usc/12/1844.md?p=b)) (BHC Act); sections 8 and 13(a) of the International Banking Act of 1978 (12 U.S.C. [3106](/usc/12/3106.md) and [3108](/usc/12/3108.md)); section 7(j)(13) of the Federal Deposit Insurance Act, as amended by the Change in Bank Control Act of 1978 ([12 U.S.C. 1817(j)(13)](/usc/12/1817.md?p=j-13)) (Bank Control Act); section 8(b) of the Federal Deposit Insurance Act ([12 U.S.C. 1818(b)](/usc/12/1818.md?p=b)); [section 914](/cfr/12/914.md) of the Financial Institutions Reform, Recovery and Enforcement Act of 1989 ([12 U.S.C. 1831i](/usc/12/1831i.md)); section 106 of the Bank Holding Company Act Amendments of 1970 ([12 U.S.C. 1972](/usc/12/1972.md)); and the International Lending Supervision Act of 1983 (Pub. L. 98-181, title IX). The BHC Act is codified at [12 U.S.C. 1841](/usc/12/1841.md), et seq.
- (b) **Purpose.** The principal purposes of this part are to:
  - (1) Regulate the acquisition of control of banks by companies and individuals;
  - (2) Define and regulate the nonbanking activities in which bank holding companies and foreign banking organizations with United States operations may engage; and
  - (3) **Set forth the procedures for securing approval for these transactions and activities.**
- (c) **Scope—**
  - (1) **Subpart A—** contains general provisions and definitions of terms used in this regulation.
  - (2) **Subpart B—** governs acquisitions of bank or bank holding company securities and assets by bank holding companies or by any company that will become a bank holding company as a result of the acquisition.
  - (3) **Subpart C—** defines and regulates the nonbanking activities in which bank holding companies and foreign banking organizations may engage directly or through a subsidiary. The Board's Regulation K governs certain nonbanking activities conducted by foreign banking organizations and certain foreign activities conducted by bank holding companies ([12 CFR part 211](/cfr/12/part211.md), International Banking Operations).
  - (4) **Subpart D—** specifies situations in which a company is presumed to control voting securities or to have the power to exercise a controlling influence over the management or policies of a bank or other company; sets forth the procedures for making a control determination; and provides rules governing the effectiveness of divestitures by bank holding companies.
  - (5) **Subpart E—** governs changes in bank control resulting from the acquisition by individuals or companies (other than bank holding companies) of voting securities of a bank holding company or state member bank of the Federal Reserve System.
  - (6) **Subpart F—** specifies the limitations that govern companies that control so-called nonbank banks and the activities of nonbank banks.
  - (7) **Subpart G—** prescribes minimum standards that apply to the performance of real estate appraisals and identifies transactions that require state certified appraisers.
  - (8) **Subpart H—** identifies the circumstances when written notice must be provided to the Board prior to the appointment of a director or senior officer of a bank holding company and establishes procedures for obtaining the required Board approval.
  - (9) Subpart I establishes the procedure by which a bank holding company may elect to become a financial holding company, enumerates the consequences if a financial holding company ceases to meet a requirement applicable to a financial holding company, lists the activities in which a financial holding company may engage, establishes the procedure by which a person may request the Board to authorize additional activities as financial in nature or incidental thereto, and establishes the procedure by which a financial holding company may seek approval to engage in an activity that is complementary to a financial activity.
  - (10) **Subpart J—** governs the conduct of merchant banking investment activities by financial holding companies as permitted under section 4(k)(4)(H) of the Bank Holding Company Act ([12 U.S.C. 1843(k)(4)(H)](/usc/12/1843.md?p=k-4-H)).
  - (11) **Subpart K—** governs the period of time that firms subject to section 13 of the Bank Holding Company Act ([12 U.S.C. 1851](/usc/12/1851.md)) have to bring their activities, investments and relationships into compliance with the requirements of such section.
  - (12) -(13) [Reserved]
  - (14) **Appendix D—** contains the Board's Capital Adequacy Guidelines for measuring tier 1 leverage for bank holding companies.
  - (15) [Reserved]
  - (16) **Appendix F—** contains the Interagency Guidelines Establishing Information Security Standards.

## Notes

### Amendments

[Reg. Y, 62 FR 9319, Feb. 28, 1997, as amended at 65 FR 16472, Mar. 28, 2000; 66 FR 414, Jan. 3, 2001; 66 FR 8484, Jan. 31, 2001; 66 FR 8636, Feb. 1, 2001; 76 FR 8275, Feb. 14, 2011; 79 FR 62290, Oct. 11, 2013]

### Source

Source: Reg. Y, 62 FR 9319, Feb. 28, 1997, unless otherwise noted.

### Authority

Authority: 12 U.S.C. 1817(j)(13), 1818, 1828(o), 1831i, 1831p-1, 1843(c)(8), 1844(b), 1972(1), 3106, 3108, 3310, 3331-3351, 3354, 3906, 3907, and 3909; 15 U.S.C. 1681s, 1681w, 6801 and 6805.

### Source

Source: Reg. Y, 49 FR 818, Jan. 5, 1984, unless otherwise noted.

### Amendments

[Reg. Y, 62 FR 9319, Feb. 28, 1997, as amended at 65 FR 16472, Mar. 28, 2000; 66 FR 414, Jan. 3, 2001; 66 FR 8484, Jan. 31, 2001; 66 FR 8636, Feb. 1, 2001; 76 FR 8275, Feb. 14, 2011; 79 FR 62290, Oct. 11, 2013]