republic-os/legal/us/code/title-12/chapter-40/section-3907.md

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LegalText	12 U.S.C. § 3907	Capital adequacy	us	united_states_code	code_section	12	BANKS AND BANKING	40	INTERNATIONAL LENDING SUPERVISION	3907	12 U.S.C. § 3907	current	119-100	2026-06-26	official	https://uscode.house.gov/download/releasepoints/us/pl/119/100/xml_usc12@119-100.zip	/us/usc/t12/s3907	data/legal/raw/us/code/title-12/usc12.xml	74e1ad1e63fc16c23d870c7fe8fcd4533f234fffbe3356471b784275d9ab803f	e6b98700ef4156ac33fde5d105824845d727afa91a53f3762be2cf4d1a3b01fa	cc9729c428febc53c50d6eb5f247e83e1d4f5acf99dd9d3089f933b7f8cccbca	2026-07-04	official	legal us-code

12 U.S.C. § 3907 - Capital adequacy

Text

(a) (1) Each appropriate Federal banking agency shall cause banking institutions to achieve and maintain adequate capital by establishing minimum levels of capital for such banking institutions and by using such other methods as the appropriate Federal banking agency deems appropriate. Each appropriate Federal banking agency shall seek to make the capital standards required under this section or other provisions of Federal law for insured depository institutions countercyclical so that the amount of capital required to be maintained by an insured depository institution increases in times of economic expansion and decreases in times of economic contraction, consistent with the safety and soundness of the insured depository institution.

(2) Each appropriate Federal banking agency shall have the authority to establish such minimum level of capital for a banking institution as the appropriate Federal banking agency, in its discretion, deems to be necessary or appropriate in light of the particular circumstances of the banking institution.

(b) (1) Failure of a banking institution to maintain capital at or above its minimum level as established pursuant to subsection (a) may be deemed by the appropriate Federal banking agency, in its discretion, to constitute an unsafe and unsound practice within the meaning of section 1818 of this title.

(2) (A) In addition to, or in lieu of, any other action authorized by law, including paragraph (1), the appropriate Federal banking agency may issue a directive to a banking institution that fails to maintain captial 11 So in original. Probably should be “capital”. at or above its required level as established pursuant to subsection (a).

(B) (i) Such directive may require the banking institution to submit and adhere to a plan acceptable to the appropriate Federal banking agency describing the means and timing by which the banking institution shall achieve its required capital level.

(ii) Any such directive issued pursuant to this paragraph, including plans submitted pursuant thereto, shall be enforceable under the provisions of section 1818(i) of this title to the same extent as an effective and outstanding order issued pursuant to section 1818(b) of this title which has become final.

(3) (A) Each appropriate Federal banking agency may consider such banking institution’s progress in adhering to any plan required under this subsection whenever such banking institution, or an affiliate thereof, or the holding company which controls such banking institution, seeks the requisite approval of such appropriate Federal banking agency for any proposal which would divert earnings, diminish capital, or otherwise impede such banking institution’s progress in achieving its minimum capital level.

(B) Such appropriate Federal banking agency may deny such approval where it determines that such proposal would adversely affect the ability of the banking institution to comply with such plan.

(C) The Chairman of the Board of Governors of the Federal Reserve System and the Secretary of the Treasury shall encourage governments, central banks, and regulatory authorities of other major banking countries to work toward maintaining and, where appropriate, strengthening the capital bases of banking institutions involved in international lending.

(Pub. L. 98–181, title I [title IX, § 908], Nov. 30, 1983, 97 Stat. 1280; Pub. L. 111–203, title VI, § 616(c), July 21, 2010, 124 Stat. 1615.)

Notes

Editorial Notes

Amendments2010—Subsec. (a)(1). Pub. L. 111–203 inserted at end “Each appropriate Federal banking agency shall seek to make the capital standards required under this section or other provisions of Federal law for insured depository institutions countercyclical so that the amount of capital required to be maintained by an insured depository institution increases in times of economic expansion and decreases in times of economic contraction, consistent with the safety and soundness of the insured depository institution.”

Statutory Notes and Related Subsidiaries

Effective Date of 2010 AmendmentAmendment by Pub. L. 111–203 effective on the transfer date, see section 616(e) of Pub. L. 111–203, set out as a note under section 1467a of this title.