Bank is 100% owned by a holding company. The bank created a mortgage subsidiary 100% owned by the Bank. The holding company does not control the Mtg sub. Per §223.3
“Member bank” means any national bank, State bank, banking association, or trust company that is a member of the Federal Reserve System. For purposes of this definition, an operating subsidiary of a member bank is treated as part of the member bank.
Does this mean the subsidiary is not an affilate of the bank?
Do we have a Reg W problem in that we provide our subsidiary with a credit facility ($100 million line)to fund their operations and the rate is below the market rate?
The underlying collateral is the mortgage warehouse loans, does the the pledged loans need to be 130% of the amount borrowed.
Since it is not afinancial sub, the requirement restricting the total amount advanced to 20% of the bank’s capital stock and surplus wouldn't apply?.