text: The Federal Reserve Act, the FDIA and the rules adopted under these statutes restrict the extent to which we 
  can borrow or otherwise obtain credit from, or engage in certain other transactions with, our depository subsidiaries. 
  These laws regulate “covered transactions” between insured depository institutions and their subsidiaries, on the one 
  hand, and their nondepository affiliates, on the other hand. “Covered transactions” include a loan or extension of 
  credit to a nondepository affiliate, a purchase of securities issued by such an affiliate, a purchase of assets from such 
  an affiliate (unless otherwise exempted by the Federal Reserve Board), an acceptance of securities issued by such an 
  affiliate as collateral for a loan, and an issuance of a guarantee, acceptance, or letter of credit for the benefit of such 
  an affiliate. The “covered transactions” that an insured depository institution and its subsidiaries are permitted to 
  engage in with their nondepository affiliates are limited to the following amounts: (1) in the case of any one such 
  affiliate, the aggregate amount of “covered transactions” cannot exceed ten percent of the capital stock and the 
  surplus of the insured depository institution; and (2) in the case of all affiliates, the aggregate amount of “covered 
  transactions” cannot exceed twenty percent of the capital stock and surplus of the insured depository institution. In 
  addition, extensions of credit that constitute “covered transactions” must be collateralized in prescribed amounts. 
  Further, a bank holding company and its subsidiaries are prohibited from engaging in certain tie-in arrangements in 
  connection with any extension of credit, lease or sale of property or furnishing of services. Finally, when we and 
  our subsidiary banks conduct transactions internally among us, we are required to do so at arm’s length. 