PART 1269—STANDBY LETTERS OF CREDIT Authority: 12 U.S.C. 1429, 1430, 1430b, 1431, 4511, 4513 and 4526. Source: 63 FR 65699, Nov. 30, 1998, unless otherwise noted. Redesignated at 65 FR 8256, Feb. 18, 2000, and further redesignated at 67 FR 12853, Mar. 20, 2002, and 75 FR 8240, Feb. 24, 2010. § 1269.1 Definitions. As used in this part: Applicant Beneficiary Community lending Confirm Document Issuer Presentation Residential housing finance (1) The purchase or funding of “residential housing finance assets,” as that term is defined in § 1266.1 of this chapter; or (2) Other activities that support the development or construction of residential housing. SHFA associate Standby letter of credit standby letter of credit [63 FR 65699, Nov. 30, 1998, as amended at 65 FR 8265, Feb. 18, 2000; 65 FR 44431, July 18, 2000. Redesignated and amended at 67 FR 12853, Mar. 20, 2002; 75 FR 8240, Feb. 24, 2010; 75 FR 76623, Dec. 9, 2010; 78 FR 2324, Jan. 11, 2013; 78 FR 67009, Nov. 8, 2013] § 1269.2 Standby letters of credit on behalf of members. (a) Authority and purposes. (1) To assist members in facilitating residential housing finance; (2) To assist members in facilitating community lending; (3) To assist members with asset/liability management; or (4) To provide members with liquidity or other funding. (b) Fully secured. (c) Eligible collateral. (2) A standby letter of credit issued or confirmed on behalf of a member for a purpose described in paragraphs (a)(1) or (a)(2) of this section may, in addition to the collateral described in paragraph (c)(1) of this section, be secured by obligations of state or local government units or agencies, where such obligations have a readily ascertainable value, can be reliably discounted to account for liquidation and other risks, and can be liquidated in due course. [63 FR 65699, Nov. 30, 1998, as amended at 65 FR 8265, Feb. 18, 2000; 65 FR 44431, July 18, 2000. Redesignated and amended at 67 FR 12853, Mar. 20, 2002; 75 FR 8240, Feb. 24, 2010; 75 FR 76623, Dec. 9, 2010; 78 FR 67009, Nov. 8, 2013] § 1269.3 Standby letters of credit on behalf of housing associates. (a) Housing associates. (1) To assist housing associates in facilitating residential housing finance; (2) To assist housing associates in facilitating community lending; (3) To assist housing associates with asset/liability management; or (4) To provide housing associates with liquidity or other funding. (b) SHFA associates. [63 FR 65699, Nov. 30, 1998, as amended at 65 FR 8265, Feb. 18, 2000; 65 FR 44431, July 18, 2000; 75 FR 8240, Feb. 24, 2010; 75 FR 76623, Dec. 9, 2010] § 1269.4 Obligation to Bank under all standby letters of credit. (a) Obligation to reimburse. (1) Established with the Bank a cash account pursuant to §§ 1266.17(b)(2)(i)(B), 1266.17(d), or 1270.3 of this chapter; and (2) Assumed an unconditional obligation to reimburse the Bank for value given by the Bank to the beneficiary under the terms of the standby letter of credit by depositing immediately available funds into the account described in paragraph (a)(1) of this section not later than the date of the Bank's payment of funds to the beneficiary. (b) Prompt action to recover funds. (c) Obligation financed by advance. [63 FR 65699, Nov. 30, 1998, as amended at 65 FR 8265, Feb. 18, 2000; 65 FR 44431, July 18, 2000. Redesignated and amended at 67 FR 12853, Mar. 20, 2002; 75 FR 8240, Feb. 24, 2010; 75 FR 76623, Dec. 9, 2010; 78 FR 2324, Jan. 11, 2013; 81 FR 76298, Nov. 2, 2016] § 1269.5 Additional provisions applying to all standby letters of credit. (a) Requirements. (1) Contain a specific expiration date, or be for a specific term; and (2) Require approval in advance by the Bank of any transfer of the standby letter of credit from the original beneficiary to another person or entity. (b) Additional collateral provisions. (2) Collateral pledged by a member or housing associate to secure a letter of credit issued or confirmed on its behalf by a Bank shall be subject to the provisions of §§ 1266.7(d), 1266.7(e), 1266.8, 1266.9 and 1266.10 of this chapter. [63 FR 65699, Nov. 30, 1998, as amended at 65 FR 8265, Feb. 18, 2000; 65 FR 44431, July 18, 2000. Redesignated and amended at 67 FR 12853, Mar. 20, 2002; 75 FR 8240, Feb. 24, 2010]