republic-os/legal/us/code/title-12/chapter-40/section-3904a.md

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LegalText	12 U.S.C. § 3904a	Additional reserve requirements	us	united_states_code	code_section	12	BANKS AND BANKING	40	INTERNATIONAL LENDING SUPERVISION	3904a	12 U.S.C. § 3904a	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/s3904a	data/legal/raw/us/code/title-12/usc12.xml	0e85ae23c6a6cd44e09da2cf759c46e7e10f1ca1245868ea63281950808b2b5a	e6b98700ef4156ac33fde5d105824845d727afa91a53f3762be2cf4d1a3b01fa	9d7875bf90e32ccc4fc49ec5042bcf0bd5d2743194913b526ab675040c6f83be	2026-07-04	official	legal us-code

12 U.S.C. § 3904a - Additional reserve requirements

Text

(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), 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), any loan—

(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).

(2) Report Each appropriate Federal banking agency shall include in each report required to be made under section 3912(d) 11 See References in Text note below. 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) 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.

(Pub. L. 98–181, title I [title IX, § 905A], as added Pub. L. 101–240, title IV, § 402(b), Dec. 19, 1989, 103 Stat. 2501.)

Notes

Editorial Notes

References in TextSection 3912(d) of this title, referred to in subsec. (c)(2), was repealed by Pub. L. 104–208, div. A, title II, § 2224(c), Sept. 30, 1996, 110 Stat. 3009–415.

Statutory Notes and Related Subsidiaries

Congressional FindingsPub. L. 101–240, title IV, § 402(a), Dec. 19, 1989, 103 Stat. 2501, provided that: “The Congress finds that— “(1) since the adoption of the International Lending Supervision Act of 1983 [12 U.S.C. 3901 et seq.], the credit quality of loans by United States banking institutions to highly indebted countries has deteriorated and the prospects for full repayment of such loans have diminished; “(2) in general during this period, the level of country exposure and transfer risk associated with loans by United States banking institutions to highly indebted countries has not been adequately reflected in the reserve levels established by many individual United States banking institutions or the reserve requirements imposed by Federal banking agencies pursuant to such Act; “(3) during the last 3 years and particularly in recent months, United States banking institutions have increased their reserves for possible losses from loans to highly indebted countries but such reserves remain, in some cases, significantly lower than reserves established by banking institutions in a number of foreign countries and may not be adequate to deal with potential risks; and “(4) in order to fulfill the purposes of such Act, the Federal banking agencies should take a more active role in reviewing reserve levels established by United States banking institutions for potential losses from loans to highly indebted countries and in requiring appropriate levels of both special and general reserves to reflect the increased risk of such loans.”