12 U.S.C. § 222 — Federal reserve districts; membership of national banks

submitted 113 years ago by ch. 6 to r/title-12-BANKS-AND-BANKING · 231 words · no verdicts yet

in plain englishAI-generated · not legal advice

This law divides the continental United States into 8 to 12 Federal Reserve districts, which the Board of Governors can redraw over time. It requires every national bank to become a member of the Federal Reserve System, or face a penalty.

This section sets up the Federal Reserve districts and requires national banks to join the system. The continental United States, not counting Alaska, is split into at least 8 and at most 12 Federal Reserve districts. The Board of Governors of the Federal Reserve System can redraw these districts or create new ones over time, as long as the total never goes above 12. The districts do not have to follow state lines — they must instead be drawn based on convenience and normal business patterns. Each district is called a "Federal reserve district" and may be identified by a number. If Alaska or Hawaii later join the Union, the Board of Governors must redraw the districts so that the new state is included in one of them. Every national bank must become a member of the Federal Reserve System. It does this by buying stock in the Federal Reserve bank of its district. A bank must do this either when it starts doing business, or within 90 days after its state joins the Union, whichever applies. Once it joins, the bank automatically becomes an insured bank under the Federal Deposit Insurance Act. If a bank fails to join as required, it faces the penalty set out in section 501a of this title.

the actual law source: uscode.house.gov ↗public domain

The continental United States, excluding Alaska, shall be divided into not less than eight nor more than twelve districts. Such districts may be readjusted and new districts may from time to time be created by the Board of Governors of the Federal Reserve System, not to exceed twelve in all: Provided, That the districts shall be apportioned with due regard to the convenience and customary course of business and shall not necessarily be coterminous with any State or States. Such districts shall be known as Federal reserve districts and may be designated by number. When the State of Alaska or Hawaii is hereafter admitted to the Union the Federal Reserve 1 districts shall be readjusted by the Board of Governors of the Federal Reserve System in such manner as to include such State. Every national bank in any State shall, upon commencing business or within ninety days after admission into the Union of the State in which it is located, become a member bank of the Federal Reserve System by subscribing and paying for stock in the Federal Reserve bank of its district in accordance with the provisions of this chapter and shall thereupon be an insured bank under the Federal Deposit Insurance Act [12 U.S.C. 1811 et seq.], and failure to do so shall subject such bank to the penalty provided by section 501a of this title.

Source credit: (Dec. 23, 1913, ch. 6, § 2 (part), 38 Stat. 251; Aug. 23, 1935, ch. 614, title II, § 203(a), 49 Stat. 704; Pub. L. 85–508, § 19, July 7, 1958, 72 Stat. 350; Pub. L. 86–3, § 17, Mar. 18, 1959, 73 Stat. 12.)

history & why it existsrecord from the source credit

1913Enacted · Act of Dec. 23, 1913, ch. 6 · 38 Stat. 251
1935Amended · Act of Aug. 23, 1935, ch. 614 · 49 Stat. 704
1958Amended · Pub. L. 85-508 · 72 Stat. 350
1959Amended · Pub. L. 86-3 · 73 Stat. 12

A history note hasn’t been published yet. The record shows enactment by ch. 6 on 1913-12-23.

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