Reg. O Loan Limit Exemption

Question:

I thought I heard Jack Holzknecht say in his Reg. O webinar that the $100,000 limitation on executive officers did not apply to related interests of the executive officer. I cannot find that exemption in the regulations. Can you tell me if this is true, and, if so, where I can find it in the regulations?

Answer:

There is no such exemption, because none is needed. The provisions of 12 CFR 215.5 only apply to an "executive officer." There is no mention of any other insiders, including related interests. Compare this section to the general Regulation O lending limit in 12 CFR 215.4, which references "any insider" and "related interests."

First published on BankersOnline.com 1/3/05