---
kind: "range"
citation: "12 U.S.C. §§ 342–348"
title: "12"
from: "342"
to: "348"
count: 11
release: "119-102"
url: "https://uscodex.org/usc/12/342..348"
---

# §342. Deposits; exchange and collection; member and nonmember banks or other depository institutions; charges


Any Federal [reserve bank](/usc/12/221.md) may receive from any of its [member banks](/usc/12/221.md), or other [depository institutions](/usc/12/24a.md?p=g-2), and from the United States, [deposits](/usc/12/5301.md?p=18-A) of current [funds](/usc/12/4702.md?p=10) in lawful money, national-[bank](/usc/12/1426a.md?p=g-1) notes, Federal reserve notes, or checks, and drafts, payable upon presentation or other items, and also, for collection, maturing notes and bills; or, solely for purposes of exchange or of collection may receive from other Federal [reserve banks](/usc/12/221.md) [deposits](/usc/12/5301.md?p=18-A) of current [funds](/usc/12/4702.md?p=10) in lawful money, national-[bank](/usc/12/1426a.md?p=g-1) notes, or checks upon other Federal [reserve banks](/usc/12/221.md), and checks and drafts, payable upon presentation within its [district](/usc/12/221.md) or other items, and maturing notes and bills payable within its [district](/usc/12/221.md); or, solely for the purposes of exchange or of collection, may receive from any nonmember bank or trust [company](/usc/12/24a.md?p=g-1) or other [depository institution](/usc/12/24a.md?p=g-2) [deposits](/usc/12/5301.md?p=18-A) of current [funds](/usc/12/4702.md?p=10) in lawful money, national-[bank](/usc/12/1426a.md?p=g-1) notes, Federal reserve notes, checks and drafts payable upon presentation or other items, or maturing notes and bills: Provided, Such nonmember bank or trust [company](/usc/12/24a.md?p=g-1) or other [depository institution](/usc/12/24a.md?p=g-2) maintains with the Federal [Reserve bank](/usc/12/221.md) of its [district](/usc/12/221.md) a balance in such amount as the [Board](/usc/12/221.md) determines taking into account items in transit, services provided by the Federal [Reserve bank](/usc/12/221.md), and other factors as the [Board](/usc/12/221.md) may deem appropriate: Provided further, That nothing in this or any other section of this chapter shall be construed as prohibiting a [member](/usc/12/1426a.md?p=g-1) or nonmember bank or other [depository institution](/usc/12/24a.md?p=g-2) from making reasonable charges, to be determined and regulated by the [Board](/usc/12/221.md) of Governors of the Federal Reserve System, but in no case to exceed 10 cents per $100 or fraction thereof, based on the total of checks and drafts presented at any one time, for collection or payment of checks and drafts and remission therefor by exchange or otherwise; but no such charges shall be made against the Federal [reserve banks](/usc/12/221.md).


# §343. Discount of obligations arising out of actual commercial transactions


Upon the indorsement of any of its [member banks](/usc/12/221.md), which shall be deemed a waiver of demand, notice and protest by such [bank](/usc/12/1426a.md?p=g-1) as to its own indorsement exclusively, any Federal [reserve bank](/usc/12/221.md) may discount notes, drafts, and bills of exchange arising out of actual commercial transactions; that is, notes, drafts, and bills of exchange issued or drawn for agricultural, industrial, or commercial purposes, or the proceeds of which have been used, or are to be used, for such purposes, the [Board](/usc/12/221.md) of Governors of the Federal Reserve System to have the right to determine or define the character of the paper thus eligible for discount, within the meaning of this chapter. Nothing in this chapter contained shall be construed to prohibit such notes, drafts, and bills of exchange, secured by staple agricultural products, or other goods, wares, or merchandise from being eligible for such discount, and the notes, drafts, and bills of exchange of factors issued as such making advances exclusively to producers of staple agricultural products in their raw [state](/usc/12/1707.md?p=d) shall be eligible for such discount; but such definition shall not include notes, drafts, or bills covering merely investments or issued or drawn for the purpose of carrying or trading in stocks, bonds, or other investment securities, except [bonds and notes of the Government of the United States](/usc/12/221.md). Notes, drafts, and bills admitted to discount under the terms of this paragraph must have a maturity at the time of discount of not more than ninety days, exclusive of grace.

- (3)
  - (A) [^1] In unusual and exigent circumstances, the [Board](/usc/12/221.md) of Governors of the Federal Reserve System, by the affirmative vote of not less than five [members](/usc/12/1426a.md?p=g-1), may authorize any Federal [reserve bank](/usc/12/221.md), during such periods as the said [board](/usc/12/221.md) may determine, at rates established in accordance with the provisions of [section 357 of this title](/usc/12/357.md), to discount for any participant in any program or facility with broad-based eligibility, notes, drafts, and bills of exchange when such notes, drafts, and bills of exchange are indorsed or otherwise secured to the satisfaction of the Federal [reserve bank](/usc/12/221.md): Provided, That before discounting any such note, draft, or bill of exchange, the Federal [reserve bank](/usc/12/221.md) shall obtain evidence that such participant in any program or facility with broad-based eligibility is unable to secure adequate [credit](/usc/12/5481.md?p=7) accommodations from other banking institutions. All such discounts for any participant in any program or facility with broad-based eligibility shall be subject to such limitations, restrictions, and regulations as the [Board](/usc/12/221.md) of Governors of the Federal Reserve System may prescribe.
  - (B)
    - (i) As soon as is practicable after July 21, 2010, the [Board](/usc/12/221.md) shall establish, by regulation, in consultation with the Secretary of the Treasury, the policies and procedures governing emergency lending under this paragraph. Such policies and procedures shall be designed to ensure that any emergency lending program or facility is for the purpose of providing liquidity to the financial system, and not to aid a failing financial [company](/usc/12/24a.md?p=g-1), and that the security for emergency loans is sufficient to protect taxpayers from losses and that any such program is terminated in a timely and orderly fashion. The policies and procedures established by the [Board](/usc/12/221.md) shall require that a Federal [reserve bank](/usc/12/221.md) assign, consistent with sound risk management practices and to ensure protection for the taxpayer, a lendable value to all collateral for a loan executed by a Federal [reserve bank](/usc/12/221.md) under this paragraph in determining whether the loan is secured satisfactorily for purposes of this paragraph.
    - (ii) The [Board](/usc/12/221.md) shall establish procedures to prohibit borrowing from programs and facilities by borrowers that are insolvent. Such procedures may include a certification from the chief [executive officer](/usc/12/1831o.md?p=b-2-H) (or other authorized officer) of the borrower, at the time the borrower initially borrows under the program or facility (with a duty by the borrower to update the certification if the information in the certification materially changes), that the borrower is not insolvent. A borrower shall be considered insolvent for purposes of this subparagraph, if the borrower is in bankruptcy, resolution under title II of the Dodd-Frank Wall Street Reform and [Consumer](/usc/12/5481.md?p=4) Protection Act [[12 U.S.C. 5381](/usc/12/5381.md) et seq.], or any other Federal or [State](/usc/12/1707.md?p=d) insolvency proceeding.
    - (iii) A program or facility that is structured to remove assets from the balance sheet of a single and specific [company](/usc/12/24a.md?p=g-1), or that is established for the purpose of assisting a single and specific [company](/usc/12/24a.md?p=g-1) avoid bankruptcy, resolution under title II of the Dodd-Frank Wall Street Reform and [Consumer](/usc/12/5481.md?p=4) Protection Act, or any other Federal or [State](/usc/12/1707.md?p=d) insolvency proceeding, shall not be considered a program or facility with broad-based eligibility.
    - (iv) The [Board](/usc/12/221.md) may not establish any program or facility under this paragraph without the prior approval of the Secretary of the Treasury.
  - (C) The [Board](/usc/12/221.md) shall provide to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives—
    - (i) not later than 7 days after the [Board](/usc/12/221.md) authorizes any loan or other financial assistance under this paragraph, a report that [includes](/usc/12/25b.md?p=a-3)—
      - (I) the justification for the exercise of authority to provide such assistance;
      - (II) the identity of the recipients of such assistance;
      - (III) the date and amount of the assistance, and form in which the assistance was provided; and
      - (IV) the material terms of the assistance, [including](/usc/12/25b.md?p=a-3)—
        - (aa) duration;
        - (bb) collateral pledged and the value thereof;
        - (cc) all interest, fees, and other revenue or items of value to be received in exchange for the assistance;
        - (dd) any requirements imposed on the recipient with respect to employee compensation, distribution of dividends, or any other corporate decision in exchange for the assistance; and
        - (ee) the expected costs to the taxpayers of such assistance; and
    - (ii) once every 30 days, with respect to any outstanding loan or other financial assistance under this paragraph, written updates on—
      - (I) the value of collateral;
      - (II) the amount of interest, fees, and other revenue or items of value received in exchange for the assistance; and
      - (III) the expected or final cost to the taxpayers of such assistance.
  - (D) The information required to be submitted to Congress under [subparagraph (C)](#3-C) related to—
    - (i) the identity of the participants in an emergency lending program or facility commenced under this paragraph;
    - (ii) the amounts borrowed by each participant in any such program or facility;
    - (iii) identifying details concerning the assets or collateral held by, under, or in connection with such a program or facility,

    shall be kept confidential, upon the written request of the Chairman of the [Board](/usc/12/221.md), in which case such information shall be made available only to the Chairpersons or Ranking [Members](/usc/12/1426a.md?p=g-1) of the Committees described in [subparagraph (C)](#3-C).

  - (E) If an entity to which a Federal [reserve bank](/usc/12/221.md) has provided a loan under this paragraph becomes a covered financial [company](/usc/12/24a.md?p=g-1), as defined in [section 201](/usc/12/201.md) of the Dodd-Frank Wall Street Reform and [Consumer](/usc/12/5481.md?p=4) Protection Act [[12 U.S.C. 5381](/usc/12/5381.md)], at any time while such loan is outstanding, and the Federal [reserve bank](/usc/12/221.md) incurs a realized net loss on the loan, then the Federal [reserve bank](/usc/12/221.md) shall have a claim equal to the amount of the net realized loss against the covered entity, with the same priority as an obligation to the Secretary of the Treasury under [section 210(b)](/usc/12/210.md) of the Dodd-Frank Wall Street Reform and [Consumer](/usc/12/5481.md?p=4) Protection Act [[12 U.S.C. 5390(b)](/usc/12/5390.md?p=b)].

# §344. Discount or purchase of bills to finance agricultural shipments


Upon the indorsement of any of its [member banks](/usc/12/221.md), which shall be deemed a waiver of demand, notice, and protest by such [bank](/usc/12/1426a.md?p=g-1) as to its own indorsement exclusively, and subject to regulations and limitations to be prescribed by the [Board](/usc/12/221.md) of Governors of the Federal Reserve System, any Federal [reserve bank](/usc/12/221.md) may discount or purchase bills of exchange payable at sight or on demand which grow out of the domestic shipment or the exportation of nonperishable, readily marketable agricultural and other staples and are secured by bills of lading or other shipping documents conveying or securing title to such staples: Provided, That all such bills of exchange shall be forwarded promptly for collection, and demand for payment shall be made with reasonable promptness after the arrival of such staples at their destination: Provided further, That no such bill shall in any event be held by or for the account of a Federal [reserve bank](/usc/12/221.md) for a period in excess of ninety days. In discounting such bills Federal [reserve banks](/usc/12/221.md) may compute the interest to be deducted on the basis of the estimated life of each bill and adjust the discount after payment of such bills to conform to the actual life thereof.


# §345. Rediscount of notes, drafts, and bills for member banks; limitation of amount


The aggregate of notes, drafts, and bills upon which [any person](/usc/12/1715z–4a.md?p=a-2), copartnership, [association](/usc/12/1828.md?p=s-4-E-i), or [corporation](/usc/12/2277a.md?p=2) is liable as maker, acceptor, indorser, drawer, or guarantor, rediscounted for any [member bank](/usc/12/221.md), shall at no time exceed the amount for which such [person](/usc/12/5481.md?p=19), copartnership, [association](/usc/12/1828.md?p=s-4-E-i), or [corporation](/usc/12/2277a.md?p=2) may lawfully become liable to a [national banking association](/usc/12/221.md) under the terms of [section 84 of this title](/usc/12/84.md): Provided, however, That nothing in this section shall be construed to change the character or class of paper now eligible for rediscount by Federal [reserve banks](/usc/12/221.md).


# §346. Discount of acceptances


Any Federal [reserve bank](/usc/12/221.md) may discount acceptances of the kinds hereinafter described, which have a maturity at the time of discount of not more than ninety days’ sight, exclusive of days of grace, and which are indorsed by at least one [member bank](/usc/12/221.md): Provided, That such acceptances if drawn for an agricultural purpose and secured at the time of acceptance by warehouse receipts or other such documents conveying or securing title covering readily marketable staples may be discounted with a maturity at the time of discount of not more than six months’ sight exclusive of days of grace.


# §347. Advances to member banks on their notes


Any Federal [reserve bank](/usc/12/221.md) may make advances for periods not exceeding fifteen days to its [member banks](/usc/12/221.md) on their promissory notes secured by the [deposit](/usc/12/5301.md?p=18-A) or pledge of bonds, notes, certificates of indebtedness, or Treasury bills of the United States, or by the [deposit](/usc/12/5301.md?p=18-A) or pledge of debentures or other such obligations of Federal intermediate [credit](/usc/12/5481.md?p=7) [banks](/usc/12/221a.md?p=a) which are eligible for purchase by Federal [reserve banks](/usc/12/221.md) under [section 350 of this title](/usc/12/350.md), or by the [deposit](/usc/12/5301.md?p=18-A) or pledge of bonds issued under the provisions of [subsection (c)](/usc/12/1463.md?p=c) of section 1463[^1] of this title; and any Federal [reserve bank](/usc/12/221.md) may make advances for periods not exceeding ninety days to its [member banks](/usc/12/221.md) on their promissory notes secured by such notes, drafts, bills of exchange, or bankers’ acceptances as are eligible for rediscount or for purchase by Federal [reserve banks](/usc/12/221.md) under the provisions of this chapter, or secured by such obligations as are eligible for purchase under [section 355 of this title](/usc/12/355.md). All such advances shall be made at rates to be established by such Federal [reserve banks](/usc/12/221.md), such rates to be subject to the review and determination of the [Board](/usc/12/221.md) of Governors of the Federal Reserve System. If any [member bank](/usc/12/221.md) to which any such advance has been made shall, during the life or continuance of such advance, and despite an official warning of the [reserve bank](/usc/12/221.md) of the [district](/usc/12/221.md) or of the [Board](/usc/12/221.md) of Governors of the Federal Reserve System to the contrary, increase its outstanding loans secured by collateral in the form of stocks, bonds, debentures, or other such obligations, or loans made to [members](/usc/12/1426a.md?p=g-1) of any organized stock exchange, investment house, or dealer in securities, upon any obligation, note, or bill, secured or unsecured, for the purpose of purchasing and/or carrying stocks, bonds, or other investment securities (except obligations of the United States) such advance shall be deemed immediately due and payable, and such [member bank](/usc/12/221.md) shall be ineligible as a borrower at the [reserve bank](/usc/12/221.md) of the [district](/usc/12/221.md) under the provisions of this section for such period as the [Board](/usc/12/221.md) of Governors of the Federal Reserve System shall determine: Provided, That no temporary carrying or clearance loans made solely for the purpose of facilitating the purchase or delivery of securities offered for public subscription shall be included in the loans referred to in this section.


# §347a. Advances to member bank groups; inadequate amounts of eligible and acceptable assets; liability of individual banks in group; distribution of loans among banks of group; rate of interest; notes accepted for advances as collateral security for Federal reserve notes; foreign obligations as security for advances


Upon receiving the consent of not less than five [members](/usc/12/1426a.md?p=g-1) of the [Board](/usc/12/221.md) of Governors of the Federal Reserve System, any Federal [reserve bank](/usc/12/221.md) may make advances, in such amount as the [board](/usc/12/221.md) of [directors](/usc/12/2279bb.md?p=3) of such Federal [reserve bank](/usc/12/221.md) may determine, to groups of five or more [member banks](/usc/12/221.md) within its [district](/usc/12/221.md), a majority of them independently owned and controlled, upon their time or demand promissory notes, provided the [bank](/usc/12/1426a.md?p=g-1) or [banks](/usc/12/221a.md?p=a) which receive the proceeds of such advances as herein provided have no adequate amounts of eligible and acceptable assets available to enable such [bank](/usc/12/1426a.md?p=g-1) or [banks](/usc/12/221a.md?p=a) to obtain sufficient [credit](/usc/12/5481.md?p=7) accommodations from the Federal [reserve bank](/usc/12/221.md) through rediscounts or advances other than as provided in [section 347b](/usc/12/347b.md)[^1] of this title. The liability of the individual [banks](/usc/12/221a.md?p=a) in each group must be limited to such proportion of the total amount advanced to such group as the [deposit](/usc/12/5301.md?p=18-A) liability of the respective [banks](/usc/12/221a.md?p=a) bears to the aggregate [deposit](/usc/12/5301.md?p=18-A) liability of all [banks](/usc/12/221a.md?p=a) in such group, but such advances may be made to a lesser number of such [member banks](/usc/12/221.md) if the aggregate amount of their [deposit](/usc/12/5301.md?p=18-A) liability constitutes at least 10 per centum of the entire [deposit](/usc/12/5301.md?p=18-A) liability of the [member banks](/usc/12/221.md) within such [district](/usc/12/221.md). Such [banks](/usc/12/221a.md?p=a) shall be authorized to distribute the proceeds of such loans to such of their number and in such amount as they may agree upon, but before so doing they shall require such recipient [banks](/usc/12/221a.md?p=a) to [deposit](/usc/12/5301.md?p=18-A) with a suitable trustee, representing the entire group, their individual notes made in favor of the group protected by such collateral security as may be agreed upon. Any Federal [reserve bank](/usc/12/221.md) making such advance shall charge interest or discount thereon at a rate not less than 1 per centum above its discount rate in effect at the time of making such advance. No such note upon which advances are made by a Federal [reserve bank](/usc/12/221.md) under this section shall be eligible under [section 412 of this title](/usc/12/412.md) as collateral security for Federal reserve notes.

No obligations of any foreign government, individual, partnership, [association](/usc/12/1828.md?p=s-4-E-i), or [corporation](/usc/12/2277a.md?p=2) organized under the laws thereof shall be eligible as collateral security for advances under this section.

[Member banks](/usc/12/221.md) are authorized to obligate themselves in accordance with the provisions of this section.


# §347b. Advances to individual member banks on time or demand notes; maturities; time notes secured by mortgage loans covering one-to-four family residences

- (a) **In general—** Any Federal [Reserve bank](/usc/12/221.md), under rules and regulations prescribed by the [Board](/usc/12/221.md) of Governors of the Federal Reserve System, may make advances to any [member bank](/usc/12/221.md) on its time or demand notes having maturities of not more than four months and which are secured to the satisfaction of such Federal [Reserve bank](/usc/12/221.md).

  Notwithstanding the foregoing, any Federal [Reserve bank](/usc/12/221.md), under rules and regulations prescribed by the [Board](/usc/12/221.md) of Governors of the Federal Reserve System, may make advances to any [member bank](/usc/12/221.md) on its time notes having such maturities as the [Board](/usc/12/221.md) may prescribe and which are secured by [mortgage](/usc/12/1707.md?p=a) loans covering a one-to-four [family](/usc/12/1715z–1.md?p=j-2-A) residence. Such advances shall bear interest at a rate equal to the lowest discount rate in effect at such Federal [Reserve bank](/usc/12/221.md) on the date of such note.

- (b) **Limitations on advances—**
  - (1) **Limitation on extended periods—** Except as provided in [paragraph (2)](#b-2), no advances to any [undercapitalized depository institution](#b-5-D) by any Federal [Reserve bank](/usc/12/221.md) under this section may be outstanding for more than 60 days in any 120-day period.
  - (2) **Viability exception—**
    - (A) **In general—** If—
      - (i) the head of the [appropriate Federal banking agency](/usc/12/24a.md?p=g-2) certifies in advance in writing to the Federal [Reserve bank](/usc/12/221.md) that any [depository institution](/usc/12/24a.md?p=g-2) is viable; or
      - (ii) the [Board](/usc/12/221.md) conducts an examination of any [depository institution](/usc/12/24a.md?p=g-2) and the Chairman of the [Board](/usc/12/221.md) certifies in writing to the Federal [Reserve bank](/usc/12/221.md) that the institution is viable,

      the limitation contained in [paragraph (1)](#b-1) shall not apply during the 60-day period beginning on the date such certification is received.

    - (B) **Extensions of period—** The 60-day period may be extended for additional 60-day periods upon receipt by the Federal [Reserve bank](/usc/12/221.md) of additional written certifications under [subparagraph (A)](#b-2-A) with respect to each such additional period.
    - (C) **Authority to issue a certificate of viability may not be delegated—** The authority of the head of any [agency](/usc/12/1422.md?p=12) to issue a written certification of viability under this paragraph may not be delegated to any other [person](/usc/12/5481.md?p=19).
    - (D) **Extended advances subject to paragraph (3)—** Notwithstanding [paragraph (1)](#b-1), an [undercapitalized depository institution](#b-5-D) which does not have a certificate of viability in effect under this paragraph may have advances outstanding for more than 60 days in any 120-day period if the [Board](/usc/12/221.md) elects to treat—
      - (i) such institution as [critically undercapitalized](#b-5-B) under [paragraph (3)](#b-3); and
      - (ii) any such advance as an advance described in [subparagraph (A)(i)](#b-3-A-i) of paragraph (3).
  - (3) **Advances to critically undercapitalized depository institutions—**
    - (A) **Liability for increased loss—** Notwithstanding any other provision of this section, if—
      - (i) in the case of any [critically undercapitalized](#b-5-B) [depository institution](/usc/12/24a.md?p=g-2)—
        - (I) any advance under this section to such institution is outstanding without payment having been demanded as of the end of the 5-day period beginning on the date the institution becomes a [critically undercapitalized](#b-5-B) [depository institution](/usc/12/24a.md?p=g-2); or
        - (II) any new advance is made to such institution under this section after the end of such period; and
      - (ii) after the end of that 5-day period, the [Deposit Insurance Fund](/usc/12/1813.md?p=y-1) of the Federal [Deposit](/usc/12/5301.md?p=18-A) Insurance [Corporation](/usc/12/2277a.md?p=2) incurs a loss exceeding the loss that the [Corporation](/usc/12/2277a.md?p=2) would have incurred if it had liquidated that institution as of the end of that period,

      the [Board](/usc/12/221.md) shall, subject to the limitations in [subparagraph (B)](#b-3-B), be liable to the Federal [Deposit](/usc/12/5301.md?p=18-A) Insurance [Corporation](/usc/12/2277a.md?p=2) for the excess loss, without regard to the terms of the advance or any collateral pledged to secure the advance.

    - (B) **Limitation on excess loss—** The liability of the [Board](/usc/12/221.md) under [subparagraph (A)](#b-3-A) shall not exceed the lesser of the following:
      - (i) The amount of the loss the [Board](/usc/12/221.md) or any Federal [Reserve bank](/usc/12/221.md) would have incurred on the increases in the amount of advances made after the 5-day period referred to in [subparagraph (A)](#b-3-A) if those increased advances had been unsecured.
      - (ii) The interest received on the increases in the amount of advances made after the 5-day period referred to in [subparagraph (A)](#b-3-A).
    - (C) **Federal Reserve to pay obligation—** The [Board](/usc/12/221.md) shall pay the Federal [Deposit](/usc/12/5301.md?p=18-A) Insurance [Corporation](/usc/12/2277a.md?p=2) the amount of any liability of the [Board](/usc/12/221.md) under [subparagraph (A)](#b-3-A).
    - (D) **Report—** The [Board](/usc/12/221.md) shall report to the Congress on any excess loss liability it incurs under [subparagraph (A)](#b-3-A), as limited by [subparagraph (B)(i)](#b-3-B-i), and the reasons therefore, not later than 6 months after incurring the liability.
  - (4) **No obligation to make advances—** A Federal [Reserve bank](/usc/12/221.md) shall have no obligation to make, increase, renew, or extend any advance or discount under this chapter to any [depository institution](/usc/12/24a.md?p=g-2).
  - (5) **Definitions—**
    - (A) **Appropriate Federal banking agency—** The term “[appropriate Federal banking agency](/usc/12/24a.md?p=g-2)” has the same meaning as in [section 1813 of this title](/usc/12/1813.md).
    - (B) **Critically undercapitalized—** The term “critically undercapitalized” has the same meaning as in [section 1831o](/usc/12/1831o.md) of this title.
    - (C) **Depository institution—** The term “[depository institution](/usc/12/24a.md?p=g-2)” has the same meaning as in [section 1813 of this title](/usc/12/1813.md).
    - (D) **Undercapitalized depository institution—** The term “undercapitalized depository institution” means any [depository institution](/usc/12/24a.md?p=g-2) which—
      - (i) is undercapitalized, as defined in [section 1831o](/usc/12/1831o.md) of this title; or
      - (ii) has a composite CAMEL rating of 5 under the Uniform [Financial Institutions](/usc/12/1715k.md?p=h-1-C) Rating System (or an equivalent rating by any such [agency](/usc/12/1422.md?p=12) under a comparable rating system) as of the most recent examination of such institution.
    - (E) **Viable—** A [depository institution](/usc/12/24a.md?p=g-2) is “viable” if the [Board](/usc/12/221.md) or the [appropriate Federal banking agency](/usc/12/24a.md?p=g-2) determines, giving due regard to the economic conditions and circumstances in the market in which the institution operates, that the institution—
      - (i) is not [critically undercapitalized](#b-5-B);
      - (ii) is not expected to become [critically undercapitalized](#b-5-B); and
      - (iii) is not expected to be placed in conservatorship or receivership.

# §347c. Advances to individuals, partnerships, and corporations; security; interest rate


Subject to such limitations, restrictions, and regulations as the [Board](/usc/12/221.md) of Governors of the Federal Reserve System may prescribe, any Federal [reserve bank](/usc/12/221.md) may make advances to any individual, partnership, or [corporation](/usc/12/2277a.md?p=2) on the promissory notes of such individual, partnership, or [corporation](/usc/12/2277a.md?p=2) secured by direct obligations of the United States or by any obligation which is a direct obligation of, or fully guaranteed as to principal and interest by any [agency](/usc/12/1422.md?p=12) of the United States. Such advances shall be made for periods not exceeding 90 days and shall bear interest at rates fixed from time to time by the Federal [reserve bank](/usc/12/221.md), subject to the review and determination of the [Board](/usc/12/221.md) of Governors of the Federal Reserve System.


# §347d. Transactions between Federal Reserve banks and branch or agency of foreign bank; matters considered


Subject to such restrictions, limitations, and regulations as may be imposed by the [Board](/usc/12/221.md) of Governors of the Federal Reserve System, each Federal [Reserve bank](/usc/12/221.md) may receive [deposits](/usc/12/5301.md?p=18-A) from, discount paper endorsed by, and make advances to any branch or agency of a foreign bank in the same manner and to the same extent that it may exercise such powers with respect to a [member bank](/usc/12/221.md) if such branch or agency is maintaining reserves with such [Reserve bank](/usc/12/221.md) pursuant to [section 3105 of this title](/usc/12/3105.md). In exercising any such powers with respect to any such branch or agency, each Federal [Reserve bank](/usc/12/221.md) shall give due regard to account balances being maintained by such branch or agency with such [Reserve bank](/usc/12/221.md) and the proportion of the assets of such branch or agency being held as reserves under [section 3105 of this title](/usc/12/3105.md). For the purposes of this paragraph, the terms “branch”, “agency”, and “foreign bank” shall have the same meanings assigned to them in [section 3101 of this title](/usc/12/3101.md).


# §348. Discount of obligations given for agricultural purposes or based upon livestock; collateral security for Federal reserve notes


Upon the indorsement of any of its [member banks](/usc/12/221.md), which shall be deemed a waiver of demand, notice, and protest by such [bank](/usc/12/1426a.md?p=g-1) as to its own indorsement exclusively, any Federal [reserve bank](/usc/12/221.md) may, subject to regulations and limitations to be prescribed by the [Board](/usc/12/221.md) of Governors of the Federal Reserve System, discount notes, drafts, and bills of exchange issued or drawn for an agricultural purpose, or based upon livestock, and having a maturity, at the time of discount, exclusive of days of grace, not exceeding nine months, and such notes, drafts, and bills of exchange may be offered as collateral security for the issuance of Federal reserve notes under the provisions of [section 16](/usc/12/16.md) of this Act: Provided, That notes, drafts, and bills of exchange with maturities in excess of six months shall not be eligible as a basis for the issuance of Federal reserve notes unless secured by warehouse receipts or other such negotiable documents conveying or securing title to readily marketable staple agricultural products or by chattel [mortgage](/usc/12/1707.md?p=a) upon livestock which is being fattened for market.