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Interpretations and Actions: October 2004

Vol. 17, No. 10

Interpretive Letters

Letter No. Topic
1008 Letter states that the OCC will consider a bank's investment in separate-account bank-owned life insurance to be a qualified investment under the Community Reinvestment Act (CRA) if the separate account in which the bank invests is comprised of investments intended to be qualified under the CRA. 07/19/2004
1009 Letter notes that the executive officer residence exception in Regulation O can only apply to a single loan secured by a first lien on one residence. Letter also notes that the Federal Home Loan Mortgage Corporation (FHLMC) is not a department, agency, bureau, board, commission or establishment of the United States or a corporation wholly owned by the United States for the purpose of the exception in Regulation O for loans secured by certain unconditional takeout commitments or guarantees of such entities; and that a contract to sell conforming loans to the FHLMC is not a participation of a particular loan. 08/12/2004
1010 Letter responds to the Bank's request concerning the permissibility of financial warranties issued by the Bank and its wholly owned subsidiary in connection with a specified mutual fund ("Fund"). The circumstances involve a factually complex financial transaction. The financial warranties, in effect, guarantee that the investment structuring advice and asset allocation monitoring services provided by the Ban in the creation and operation of the Fund will result in the designed return to investors. Known in the industry as "principal protected" funds, the Fund is designed so that investors will not lose any principal over a designated holding period and will earn a minimum fixed rate of return. Under the specific facts described and subject to satisfying the safety and soundness considerations discussed, we conclude the Bank and its subsidiary may provide the financial warranties under 12 CFR 7.1017. 09/07/2004

Community Development Investment Letters

Letter No. Topic
2004-1 New Markets Tax Credit Investment Fund – A national bank invested in a leveraged new markets tax credit multi-investor limited partnership (Fund). The sponsor of the Fund is a Community Development Entity certified by the U.S. Treasury Department's Community Development Financial Institutions Fund. The Fund will make loans to or investments in qualified, active, low-income community businesses that, in turn, will qualify the Fund to receive new markets tax credits that have previously been allocated to the sponsor. 08/30/2004

Corporate Decisions

Letter No. Topic
2004-15 Application to merge Jackson Federal Bank, Fullerton, California with and into Union Bank of California, N.A., San Francisco, California. (Control Number 2004 WE 02 0037), 09/08/2004
2004-16 Application by First National Bank in Durant, Durant, Oklahoma, to establish a limited partnership as an operating subsidiary with a wholly owned LLC as the limited partner and a wholly owned corporation as a general partner. (Control Number 2004 SO 08 0017), 09/10/2004

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

Letter No. Topic
649 Application to merge SunBank, Lewisburg, Pennsylvania with and into Omega Bank, National Association, Huntingdon, Pennsylvania under the charter and title of the latter, following the merger of Sun Bancorp, Inc., Lewisburg, Pennsylvania into Omega Financial Corporation, State College, Pennsylvania. (Control Number 2004 NE 02 0036), 09/08/2004
650 Application to establish a new national limited purpose credit card bank with the title of "RBS National Bank," Bridgeport, Connecticut. (Control Number 2004 WE 01 0009), 09/15/2004
651 Application to charter a de novo bank with the title of THE National Bank," Edina, Minnesota and request to waive to the residency requirements for proposed directors. 09/17/2004
652 Application filed on behalf of Bessemer Trust Company, New York, New York, to establish a new national trust bank, which will engage solely in fiduciary activities, with the title of "Bessemer Trust Company of Delaware, National Association," Wilmington, Delaware. (Control Numbers 2004 NE 01 0009 & 2004 NE 08 0021), 09/27/2004
653 Application by Treasury Bank, National Association, Alexandria, Virginia, for a material non-cash contribution to capital surplus. (Control Number 2004 WE 12 0304), 09/28/2004

Charters with Standard Conditions


Letter No. Topic
654 Application to charter Valliance Bank, National Association, Oklahoma City, Oklahoma. (Control Number 2004 SO 01 0012), 08/31/2004
655 Application to establish Community National Bank, Great Neck Estates Village, New York. 09/13/2004
656 Application to convert BNY Western Trust Company, Los Angeles, California, to a national bank with the title of The Bank of New York Trust Company. (Control Number 2004 WE 01 0008), 09/13/2004
657 Application to establish Paragon National Bank, Memphis, Tennessee. (Control Number 2004 SO 01 0013), 09/29/2004

Final Enforcement Actions

Enclosed is a copy of the OCC's news release number 2004-97, 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 September 15 through October 14, 2004.

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 Licensing. The Community Development Investment Letters are from the office of Community Affairs. 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.

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, ATTN: Accounts Receivable, Mail Stop 4-8, 250 E Street, S.W., Washington, DC 20219. Prepayment is requested. Suggestions, comments or questions may be sent to Jacqueline J. England, Comptroller of the Currency, Communications Division, Mail Stop 3-2, Washington, DC 20219.