124 STAT. 1608 PUBLIC LAW 111–203—JULY 21, 2010 (b) INTERSTATE BANK MERGERS.—Section 44(b)(4)(B) of the Fed- eral Deposit Insurance Act (12 U.S.C. 1831u(b)(4)(B)) is amended by striking ‘‘will continue to be adequately capitalized and ade- quately managed’’ and inserting ‘‘will be well capitalized and well managed’’. (c) EFFECTIVE DATE.—The amendments made by this section shall take effect on the transfer date. SEC. 608. ENHANCING EXISTING RESTRICTIONS ON BANK TRANS- ACTIONS WITH AFFILIATES. (a) AFFILIATE TRANSACTIONS.—Section 23A of the Federal Reserve Act (12 U.S.C. 371c) is amended— (1) in subsection (b)— (A) in paragraph (1), by striking subparagraph (D) and inserting the following: ‘‘(D) any investment fund with respect to which a member bank or affiliate thereof is an investment adviser; and’’; and (B) in paragraph (7)— (i) in subparagraph (A), by inserting before the semicolon at the end the following: ‘‘, including a pur- chase of assets subject to an agreement to repurchase’’; (ii) in subparagraph (C), by striking ‘‘, including assets subject to an agreement to repurchase,’’; (iii) in subparagraph (D)— (I) by inserting ‘‘or other debt obligations’’ after ‘‘acceptance of securities’’; and (II) by striking ‘‘or’’ at the end; and (iv) by adding at the end the following: ‘‘(F) a transaction with an affiliate that involves the borrowing or lending of securities, to the extent that the transaction causes a member bank or a subsidiary to have credit exposure to the affiliate; or ‘‘(G) a derivative transaction, as defined in paragraph (3) of section 5200(b) of the Revised Statutes of the United States (12 U.S.C. 84(b)), with an affiliate, to the extent that the transaction causes a member bank or a subsidiary to have credit exposure to the affiliate;’’; (2) in subsection (c)— (A) in paragraph (1)— (i) in the matter preceding subparagraph (A), by striking ‘‘subsidiary’’ and all that follows through ‘‘time of the transaction’’ and inserting ‘‘subsidiary, and any credit exposure of a member bank or a subsidiary to an affiliate resulting from a securities borrowing or lending transaction, or a derivative transaction, shall be secured at all times’’; and (ii) in each of subparagraphs (A) through (D), by striking ‘‘or letter of credit’’ and inserting ‘‘letter of credit, or credit exposure’’; (B) by striking paragraph (2); (C) by redesignating paragraphs (3) through (5) as paragraphs (2) through (4), respectively; (D) in paragraph (2), as so redesignated, by inserting before the period at the end ‘‘, or credit exposure to an affiliate resulting from a securities borrowing or lending transaction, or derivative transaction’’; and 12 USC 1831u note.
