legislation was designed to minimize the potential for illegal activities by establishing uniform standards for entry by foreign banks and, if illegal activities are suspected, to provide as many regulatory and supervisory tools as possible to investigate and enforce compliance.
Although the Board believes that these provisions go too far, the Board believes that some provisions of FBSEA
should be reevaluated--most notably the inflexible requirement that the Board not approve an application unless a foreign bank is subject to comprehensive consolidated supervision by home country authorities.
The FBSEA also imposed new restrictions on deposit taking by foreign banks.
The immediate effectiveness of major portions of the FBSEA required that implementation proceed quickly.
On December 19, 1991, the Board and the OCC issued a joint statement to guide foreign bank branches and agencies with respect to the new statutory limitation in the FBSEA on deposit taking.
6) A recent technical amendment to the FBSEA, adopted in October 1992, has clarified that the statutory prohibition on accepting deposits under $100,000 is limited to domestic retail deposits that require deposit insurance protection and does not apply to the broader category of all deposits "having balances of less than $100,000.
It also implemented in Regulation K provisions of the FBSEA that permit disclosure of certain information to foreign supervisors and establish limits on loans to a single borrower by state branches and agencies.
The FBSEA imposes the following two mandatory standards for the establishment by a foreign bank of a branch, agency, or commercial lending company subsidiary: