Answer:
Section 215.3 (a) (4) of the Federal Reserve Regulation O defines as a covered "extension of credit" any acquisition of any note upon which an insider may be liable as a guarantor, and, thus, it would appear that the making of such a loan would be subject to the non-preferential, prior approval, and lending limit requirements of the regulation.
First published on BankersOnline.com 1/15/01