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Interpretations and Actions: November 2002

Vol. 15, No. 11

PLEASE NOTE: Interpretive Letters and No-Objection Letters reflect the views of the Comptroller's legal staff. Corporate Decisions, CRA Decisions and Conditional Approvals are from the office of Bank Organization and Structure. The list of CRA Ratings is from the Communications Division. For copies of the CRA evaluations, you may either contact the bank directly, or you may write to the Office of the Comptroller of the Currency (OCC) in any of three ways: by mail to the OCC, Attn: Public Information Room, Mail Stop 1-5, Washington, D.C. 20219; by fax to (202) 874-4448; or by e-mail to You may also write to the OCC for copies of enforcement actions and charters with standard conditions.

Members of the news media are encouraged to cite the letter number when reporting or summarizing documents from this package. This helps us to process single requests based upon your citation in a more timely manner.

Interpretive Letters

Letter No. Topic
945 Under risk-based capital guidelines, bank may lower risk weight from 100% to 20% on assets covered by credit default purchased from and OECD bank. However, where the stated maturity on the reference assets is 35 years but the premium paid on the credit default swap is refixed in three and a half years based on then prevailing market prices and the outstanding portfolio amount, the bank may only risk weight the covered assets at the lower 20% risk weight for the three and a half years and provided that the amount of credit protection is reduced 25% in the last four quarter of the three and half year period. 06/13/2000
946 Letter discusses capital treatment of five proposed credit derivative transactions: (1) cash securitization, (2) credit linked note, (3) credit default referencing a credit linked note held by the counterparty, (4) credit default swap directly on the reference portfolio, and (5) variable funding credit linked note. 09/27/2001
947 Bank purchase of credit card securitization required to be consolidated on the books of the Bank under generally accepted accounting practices because the Bank was not the original transferor of the assets held in the trust. As old receivables are paid down and replenished by new receivables, the trust will receive sales treatment. 05/28/2002

CRA Decisions

Letter No. Topic
112 Application by U.S. Bank National Association, Cincinnati, Ohio, to purchase certain assets and assume certain liabilities of 57 California branches of Bay View Bank, National Association, San Mateo, California. (Control Number 2002 CE 02 020), 10/10/2002
113 Application by The Baraboo National Bank, Baraboo, Wisconsin, to merge with State Bank of Wonewoc, Wonewoc, Wisconsin, under the charter and title of the Baraboo National Bank. (Control Number 2002 CE 02 0018), 10/28/2002

Corporate Decisions

Letter No. Topic
2002-15 Request by Wachovia Bank, National Association (F/K/A First Union National Bank, Successor by merger to First Union National Bank of North Carolina) to be relieved from certain commitments noted in the OCC's April 15, 1994 approval letter permitting First Union National Bank of North Carolina to acquire the partnership interests of Lieber & Company and the assets and liabilities of Evergreen Asset Management Corporation. (Control Number 2002 ML 12 0250), 10/07/2002

Approvals with Conditions Enforceable under 12 U.S.C. 1818

Letter No. Topic
553 Application to merger Frontier National Bank, Sylacauga, Alabama into Frontier National Bank, LaGrange, Georgia. (Control Number 2002 SE 02 0019), 10/02/2002
554 Application to charter Merchants Bank, National Association, La Crescent, Minnesota and the application by the new bank to purchase certain assets and assume certain liabilities of Merchants Bank, NA, La Crescent, Minnesota ("existing"). (Control Numbers 2002 MW 01 0009 and 2002 MW 02 0021), 10/21/2002
555 Application to relocate the main office of Merchants Bank, National Association, La Crescent, Minnesota to Onalaska, Wisconsin and to reduce its capital stock. (Control Numbers 2002 MW 07 0019 and 2002 MW 12 0143), 10/21/2002
556 Application by Neuberger Berman Inc. to charter a national trust bank with the title of New NBTC, National Association, New York, New York, and the application to merge Neuberger Berman Trust Company, National Association, Seattle, Washington, with and into New NBTC, National Association, New York, New York, under the charter of the latter and with the charter number and title of the former. (Control Number 2002 NE 02 0027), 10/24/2002

Charters with Standard Condition

Each of the following charter application(s) were approved with a standard condition enforceable under 12 U.S.C. 1818 that requires the bank to provide notice and obtain OCC's non-objection in advance of any significant deviations or changes from its business plan or operations.

Letter No. Topic
557 Application to charter Community National Bank of Lakeway Area, Morristown, Tennessee. (Control Number 2002 SE 01 008), 10/03/2002

Final Enforcement Actions

Enclosed is a copy of the OCC's news release number 2002-88, announcing the availability of enforcement actions. Copies of the final actions are available by writing to the OCC, Public Reference Room, Mailstop 1-5, Washington, D.C. 20219. When ordering, specify the appropriate enforcement action number.

Community Reinvestment Act (CRA) Performance Evaluations

Enclosed is a list of CRA performance evaluations that became public during the period of October 15 through November 14, 2002.

The Office of the Comptroller of the Currency publishes INTERPRETATIONS AND ACTIONS monthly. Subscriptions are available at a rate of $175 per year by writing to the Comptroller of the Currency, P.O. Box 73150, Chicago, IL 60673. Prepayment is requested. Suggestions, comments or questions may be sent to Jacqueline J. England, Communications Division, Comptroller of the Currency, Mail Stop 3-2, Washington, DC 20219.