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U.S. Code as of:
01/19/04
Section 3904a. Additional reserve requirements
(a) In general
Each appropriate Federal banking agency shall review the exposure
to risk of United States banking institutions arising from the
medium- and long-term loans made by such institutions that are
outstanding to any highly indebted country. Each agency shall
provide direction to such institutions regarding additions to
general reserves maintained by each banking institution for
potential loan losses and special reserves required by such agency
arising from such review.
(b) Determination of institutional exposure to risk
In determining the exposure of an institution to risk for
purposes of subsection (a) of this section, the appropriate Federal
banking agency -
(1) shall determine whether any country exposure that is, and
has been for at least 2 years, rated in the category "Other
Transfer Risk Problems" or the category "Substandard" by the
Interagency Country Exposure Review Committee should be
reevaluated;
(2) may exempt, in full or in part, from reserve requirements
established pursuant to subsection (a) of this section, any loan
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(A) to a country that enters into a debt reduction, debt
service reduction, or financing program with its bank creditors
that is supported by the International Bank for Reconstruction
and Development or the International Monetary Fund; or
(B) secured, in whole or in part, by appropriate collateral
for payment of interest or principal;
(3) take into account any other factors which bear on such
exposure and the particular circumstances of the institution; and
(4) shall consider as indicators of risk, where appropriate,
the average reserve levels maintained by or required of banking
institutions in foreign countries and secondary market prices for
such loans.
(c) Timing and report
(1) Determined by agency
Except as provided in paragraph (3), each appropriate Federal
banking agency shall determine the timing of any addition to
reserves required by subsection (a) of this section.
(2) Report
Each appropriate Federal banking agency shall include in each
report required to be made under section 3912(d) (!1) of this
title after 1989 a report on the actions taken pursuant to this
section.
(3) Deadline
Each Federal agency required to undertake a review described in
subsection (a) of this section shall complete the review not
later than December 31, 1990.
(d) "Highly indebted country" defined
As used in this section, the term "highly indebted country" means
any country designated as a "Highly Indebted Country" in the annual
World Debt Tables most recently published by the International Bank
for Reconstruction and Development before December 19, 1989.
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