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Employee Loan Program

Answered by: 
Andy Zavoina

Question: 
Our bank is setting up a program to offer all employees a discount on loan rates. My understanding of Reg. O is that there is an exception for employee loan programs and that executive officers as employees of the bank could participate in these special programs offered to all bank employees. Is this correct, and would it also apply to an employee who is also on the board of directors?
Answer: 

215.4(a)(2) does allow this so long as it is part of your compensation program and employees are using it just as your "insiders" are. That is, if the insiders are not the only ones who either do use it, or are able to use it.

The compensation program should define who is able to participate.

First published on BankersOnline.com 9/6/04

First published on 09/06/2004

Filed under: 
Compliance
Filed under compliance as: 
Employee
Executive Officers
IT

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