Indiana Code 28-6.1-9-6. Exceptions to lending limitations
(1) Loans or extensions of credit arising from the discount of commercial or business paper evidencing an obligation to the person negotiating the loan or extension of credit with recourse are not subject to any limitation based on capital and surplus.
Terms Used In Indiana Code 28-6.1-9-6
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- person: includes an individual, an association, a business trust, a corporation, an estate, a joint venture, a sole proprietorship, a partnership, a trust, a government, or an agency, an instrumentality, or a political subdivision of a government, or any similar entity. See Indiana Code 28-6.1-9-3
- Property: includes personal and real property. See Indiana Code 1-1-4-5
- Recourse: An arrangement in which a bank retains, in form or in substance, any credit risk directly or indirectly associated with an asset it has sold (in accordance with generally accepted accounting principles) that exceeds a pro rata share of the bank's claim on the asset. If a bank has no claim on an asset it has sold, then the retention of any credit risk is recourse. Source: FDIC
- United States: includes the District of Columbia and the commonwealths, possessions, states in free association with the United States, and the territories. See Indiana Code 1-1-4-5
(3) Loans and extensions of credit secured by bills of lading, warehouse receipts, or similar documents transferring or securing title to readily marketable staples are subject to a limitation of thirty-five percent (35%) of capital and surplus in addition to the general limitations if the market value of the staples securing each additional loan or extension of credit at all times equals or exceeds one hundred fifteen percent (115%) of the outstanding amount of the loan or extension of credit. The staples shall be fully covered by insurance whenever it is customary to insure them.
(4) Loans or extensions of credit secured by bonds, notes, certificates of indebtedness, or treasury bills of the United States or by other similar obligations fully guaranteed as to principal and interest by the United States are not subject to any limitation based on capital and surplus.
(5) Loans or extensions of credit to or secured by unconditional takeout commitment or guarantees of an agency, a board, a bureau, a commission, a department, or other establishment of the United States or corporation wholly owned directly or indirectly by the United States are not subject to any limitation based on capital and surplus.
(6) Loans or extensions of credit secured by a segregated deposit account in the lending bank are not subject to any limitation based on capital and surplus.
(7) Loans or extensions of credit to a financial institution or to a receiver, conservator, superintendent of banks, or other agent in charge of the business and property of the financial institution, when the loans or extensions of credit are approved by the director, are not subject to any limitation based on capital and surplus.
As added by P.L.42-1993, SEC.72.