Page:United States Statutes at Large Volume 96 Part 2.djvu/128

 96 STAT. 1490

"Qualified institution."

PUBLIC LAW 97-320—OCT. 15, 1982

subordinated to the claims of general creditors which were outstanding when any certificates were purchased, and over any right of equity holders to participate in future earnings. "(B) For the purposes of this paragraph, the term 'qualified institution' means an institution the deposits of which are insured under this title or insured or guaranteed under State law which, as determined by the Corporation— "(i) has net worth equal to or less than 3 per centum of its assets; "(ii) has incurred losses during the two previous quarters; "(iii) has not incurred such losses as a result of transactions involving speculation in futures or forward contracts, of management action designed solely for the purpose of qualifying for assistance, or of excessive operating expenses; "(iv) agrees to comply with all the terms and conditions established by the Corporation for receiving assistance pursuant to this paragraph, including those relating to reporting, compliance with laws, rules and regulations, execution and implementation of resolutions and agreements to merge or reorganize, submission and adoption of plans of operation, restrictions on operations, repayment of assistance received, and consent to supervisory action; "(v) will have a net worth of not less than one-half of one per centum of assets after any purchase of its net worth certificates by the Corporation, as determined by the Corporation in accordance with the methods for calculating net worth pursuant to this paragraph; and "(vi) has investments in residential mortgages or securities backed by such mortgages aggregating at least 20 per centum of its loans. "(C)(i) The Corporation may not condition the purchase of certificates under this paragraph on the agreement of the institution's board to allow such institution to be merged with or acquired by another company if the Corporation finds that such institution will have positive net worth for a period of at least six months after such certificates are purchased. "(ii) The Corporation may not condition the purchase of certificates under this paragraph on the agreement of the institution's board to make specified management personnel changes if the Corporation finds that if such institution will have positive net worth for a period of at least nine months after such certificates are purchased. "(D) In any case where the staff of the Corporation finds for the purpose of subparagraph (C) that the length of time during which the institution will have positive net worth after a purchase of certificates is less than six months or nine months, as the case may be, the institution may submit to the staff its plans and projections. If the staff does not change its position after considering such plans and projections, the institution may submit such plans and projections to the Board and the institution shall be entitled to an appeal to, and a review of the staffs findings by, the Board. "(E) The Corporation may initially purchase net worth certificates as follows: "(i) With respect to a qualified institution having net worth greater than 2 per centum and less than or equal to 3 per centum, the Corporation may purchase net worth certificates in any period from such institution in an amount equal to 50 per

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