Title 12--Banks and Banking

CHAPTER III--FEDERAL DEPOSIT INSURANCE CORPORATION

PART 330--DEPOSIT INSURANCE COVERAGE

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Sec. 330.1 Definitions

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    For the purposes of this part:
    (a) Act means the Federal Deposit Insurance Act (12 U.S.C. 1811 et 
seq.).
    (b) Corporation means the Federal Deposit Insurance Corporation.
    (c) Default has the same meaning as provided under section 3(x) of 
the Act (12 U.S.C. 1813(x)).
    (d) Deposit has the same meaning as provided under section 3(l) of 
the Act (12 U.S.C. 1813(l)).
    (e) Deposit account records means account ledgers, signature cards, 
certificates of deposit, passbooks, corporate resolutions authorizing 
accounts in the possession of the insured depository institution and 
other books and records of the insured depository institution, including 
records maintained by computer, which relate to the insured depository 
institution's deposit taking function, but does not mean account 
statements, deposit slips, items deposited or cancelled checks.
    (f) FDIC means the Federal Deposit Insurance Corporation.
    (g) Independent activity. A corporation, partnership or 
unincorporated association shall be deemed to be engaged in an 
``independent activity'' if the entity is operated primarily for some 
purpose other than to increase deposit insurance.
    (h) Insured branch means a branch of a foreign bank any deposits in 
which are insured in accordance with the provisions of the Act.
    (i) Insured deposit has the same meaning as that provided under 
section 3(m)(1) of the Act (12 U.S.C. 1813(m)(1)).
    (j) Insured depository institution is any depository institution 
whose deposits are insured pursuant to the Act, including a foreign bank 
having an insured branch.
    (k) Natural person means a human being.
    (l) Non-contingent trust interest means a trust interest capable of 
determination without evaluation of contingencies except for those 
covered by the present worth tables and rules of calculation for their 
use set forth in Sec. 20.2031-7 of the Federal Estate Tax Regulations 
(26 CFR 20.2031-7) or any similar present worth or life expectancy 
tables which may be adopted by the Internal Revenue Service.
    (m) Sole proprietorship means a form of business in which one person 
owns

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all the assets of the business, in contrast to a partnership or 
corporation.
    (n) Trust estate means the determinable and beneficial interest of a 
beneficiary or principal in trust funds but does not include the 
beneficial interest of an heir or devisee in a decedent's estate.
    (o) Trust funds means funds held by an insured depository 
institution as trustee pursuant to any irrevocable trust established 
pursuant to any statute or written trust agreement.
    (p) Trust interest means the interest of a beneficiary in an 
irrevocable express trust (other than an employee benefit plan) created 
either by written trust instrument or by statute, but does not include 
any interest retained by the settlor.

Sec. 330.2 Purpose.

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    The purpose of this part is to clarify the rules and define the 
terms necessary to afford deposit insurance coverage under the Act and 
provide rules for the recognition of deposit ownership in various 
circumstances.

Sec. 330.3 General Principles.

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    (a) Ownership rights and capacities. The insurance coverage provided 
by the Act and this part is based upon the ownership rights and 
capacities in which deposit accounts are maintained at insured 
depository institutions. All deposits in an insured depository 
institution which are maintained in the same right and capacity (by or 
for the benefit of a particular depositor or depositors) shall be added 
together and insured in accordance with this part. Deposits maintained 
in different rights and capacities, as recognized under this part, shall 
be insured separately from each other. (Example: Single ownership 
accounts and joint ownership accounts are insured separately from each 
other.)
    (b) Deposits maintained in separate insured depository institutions 
or in separate branches of the same insured depository institution. Any 
deposit accounts maintained by a depositor at one insured depository 
institution are insured separately from, and without regard to, any 
deposit accounts that the same depositor maintains at any other 
separately chartered and insured depository institution, even if two or 
more separately chartered and insured depository institutions are 
affiliated through common ownership. (Example: Deposits held by the same 
individual at two different banks owned by the same bank holding company 
would be insured separately, per bank.)
    The deposit accounts of a depositor maintained in the same right and 
capacity at different branches or offices of the same insured depository 
institution are not separately insured; rather they shall be added 
together and insured in accordance with this part.
    (c) Deposits maintained by foreigners and deposits denominated in 
foreign currency. The availability of deposit insurance is not limited 
to citizens and residents of the United States. Any person or entity 
that maintains deposits in an insured depository institution is entitled 
to the deposit insurance provided by the Act and this part. In addition, 
deposits denominated in a foreign currency shall be insured in 
accordance with this part. Deposit insurance for such deposits shall be 
determined and paid in the amount of United States dollars that is 
equivalent in value to the amount of the deposit denominated in the 
foreign currency as of close of business on the date of default of the 
insured depository institution. The exchange rates to be used for such 
conversions are the 12 PM rates (the ``noon buying rates for cable 
transfers'') quoted for major currencies by the Federal Reserve Bank of 
New York on the date of default of the insured depository institution, 
unless the deposit agreement specifies that some other widely recognized 
exchange rates are to be used for all purposes under that agreement, in 
which case, the rates so specified shall be used for such conversions.
    (d) Deposits in insured branches of foreign banks. Deposits in an 
insured branch of a foreign bank which are payable by contract in the 
United States shall be insured in accordance with this part, except that 
any deposits to the credit of the foreign bank, or any office, branch, 
agency or any wholly owned subsidiary of the foreign bank, shall not be 
insured. All deposits held by a depositor in the same right and capacity 
in more than one insured

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branch of the same foreign bank shall be added together for the purpose 
of determining the amount of deposit insurance.
    (e) Deposits payable solely outside of the United States and certain 
other locations. Any obligation of an insured depository institution 
which is payable solely at an office of such institution located outside 
the States of the United States, the District of Columbia, Puerto Rico, 
Guam, the Commonwealth of the Northern Mariana Islands, American Samoa, 
the Trust Territory of the Pacific Islands, and the Virgin Islands, is 
not a deposit for the purposes of this part.
    (f) International banking facility deposits. An ``international 
banking facility time deposit,'' as defined by the Board of Governors of 
the Federal Reserve System in Regulation D (12 CFR 204.8(a)(2)), or in 
any successor regulation, is not a deposit for the purposes of this 
part.
    (g) Bank investment contracts. As required by section 11(a)(8) of 
the Act (12 U.S.C. 1821(a)(8)), any liability arising under any 
investment contract between any insured depository institution and any 
employee benefit plan which expressly permits ``benefit responsive 
withdrawals or transfers'' (as defined in section 11(a)(8) of the Act) 
are not insured deposits for purposes of this part. The term 
``substantial penalty or adjustment'' used in section 11(a)(8) of the 
Act means, in the case of a deposit having an original term which 
exceeds one year, all interest earned on the amount withdrawn from the 
date of deposit or for six months, whichever is less; or, in the case of 
a deposit having an original term of one year or less, all interest 
earned on the amount withdrawn from the date of deposit or three months, 
whichever is less.
    (h) Application of state or local law to deposit insurance 
determinations. In general, deposit insurance is for the benefit of the 
owner or owners of funds on deposit. However, while ownership under 
state law of deposited funds is a necessary condition for deposit 
insurance, ownership under state law is not sufficient for, or decisive 
in, determining deposit insurance coverage. Deposit insurance coverage 
is also a function of the deposit account records of the insured 
depository institution and of the provisions of this part, which, in the 
interest of uniform national rules for deposit insurance coverage, are 
controlling for purposes of determining deposit insurance coverage.
    (i) Determination of the amount of a deposit--(1) General rule. The 
amount of a deposit is the balance of principal and interest 
unconditionally credited to the deposit account as of the date of 
default of the insured depository institution, plus the ascertainable 
amount of interest to that date, accrued at the contract rate (or the 
anticipated or announced interest or dividend rate), which the insured 
depository institution in default would have paid if the deposit had 
matured on that date and the insured depository institution had not 
failed. In the absence of any such announced or anticipated interest or 
dividend rate, the rate for this purpose shall be whatever rate was paid 
in the immediately preceding payment period.
    (2) Discounted certificates of deposit. The amount of a certificate 
of deposit sold by an insured depository institution at a discount from 
its face value is its original purchase price plus the amount of accrued 
earnings calculated by compounding interest annually at the rate 
necessary to increase the original purchase price to the maturity value 
over the life of the certificate.
    (3) Waiver of minimum requirements. In the case of a deposit with a 
fixed payment date, fixed or minimum term, or a qualifying or notice 
period that has not expired as of such date, interest thereon to the 
date of closing shall be computed according to the terms of the deposit 
contract as if interest had been credited and as if the deposit could 
have been withdrawn on such date without any penalty or reduction in the 
rate of earnings.
    (j) Continuation of insurance coverage following the death of a 
deposit owner. The death of a deposit owner shall not affect the 
insurance coverage of the deposit for a period of six months following 
the owner's death unless the deposit account is restructured. The 
operation of this grace period, however, shall not result in a reduction 
of coverage. If an account is not restructured

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within six months after the owner's death, the insurance shall be 
provided on the basis of actual ownership in accordance with the 
provisions of Sec. 330.5(a)(1).

[63 FR 25756, May 11, 1998, as amended at 64 FR 15656, Apr. 1, 1999]

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    Whenever the liabilities of one or more insured depository 
institutions for deposits are assumed by another insured depository 
institution, whether by merger, consolidation, other statutory 
assumption or contract:
    (a) The insured status of the institutions whose liabilities have 
been assumed terminates on the date of receipt by the FDIC of 
satisfactory evidence of the assumption; and
    (b) The separate insurance of deposits assumed continues for six 
months from the date the assumption takes effect or, in the case of a 
time deposit, the earliest maturity date after the six-month period. In 
the case of time deposits which mature within six months of the date the 
deposits are assumed and which are renewed at the same dollar amount 
(either with or without accrued interest having been added to the 
principal amount) and for the same term as the original deposit, the 
separate insurance applies to the renewed deposits until the first 
maturity date after the six-month period. Time deposits that mature 
within six months of the deposit assumption and that are renewed on any 
other basis, or that are not renewed and thereby become demand deposits, 
are separately insured only until the end of the six-month period.

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    (a) Recognition of deposit ownership--(1) Evidence of deposit 
ownership. Except as indicated in this paragraph (a)(1) or as provided 
in Sec. 330.3(j), in determining the amount of insurance available to 
each depositor, the FDIC shall presume that deposited funds are actually 
owned in the manner indicated on the deposit account records of the 
insured depository institution. If the FDIC, in its sole discretion, 
determines that the deposit account records of the insured depository 
institution are clear and unambiguous, those records shall be considered 
binding on the depositor, and the FDIC shall consider no other records 
on the manner in which the funds are owned. If the deposit account 
records are ambiguous or unclear on the manner in which the funds are 
owned, then the FDIC may, in its sole discretion, consider evidence 
other than the deposit account records of the insured depository 
institution for the purpose of establishing the manner in which the 
funds are owned. Despite the general requirements of this paragraph 
(a)(1), if the FDIC has reason to believe that the insured depository 
institution's deposit account records misrepresent the actual ownership 
of deposited funds and such misrepresentation would increase deposit 
insurance coverage, the FDIC may consider all available evidence and pay 
claims for insured deposits on the basis of the actual rather than the 
misrepresented ownership.
    (2) Recognition of deposit ownership in custodial accounts. In the 
case of custodial deposits, the interest of each beneficial owner may be 
determined on a fractional or percentage basis. This may be accomplished 
in any manner which indicates that where the funds of an owner are 
commingled with other funds held in a custodial capacity and a portion 
thereof is placed on deposit in one or more insured depository 
institutions without allocation, the owner's insured interest in the 
deposit in any one insured depository institution would represent, at 
any given time, the same fractional share as his or her share of the 
total commingled funds.
    (b) Fiduciary relationships--(1) Recognition. The FDIC will 
recognize a claim for insurance coverage based on a fiduciary 
relationship only if the relationship is expressly disclosed, by way of 
specific references, in the ``deposit account records'' (as defined in 
Sec. 330.1(e)) of the insured depository institution. Such relationships 
include, but are not limited to, relationships involving a trustee, 
agent, nominee, guardian, executor or custodian pursuant to which funds 
are deposited. The express indication that the account is held in a 
fiduciary capacity will not be

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necessary, however, in instances where the FDIC determines, in its sole 
discretion, that the titling of the deposit account and the underlying 
deposit account records sufficiently indicate the existence of a 
fiduciary relationship. This exception may apply, for example, where the 
deposit account title or records indicate that the account is held by an 
escrow agent, title company or a company whose business is to hold 
deposits and securities for others.
    (2) Details of fiduciary relationships. If the deposit account 
records of an insured depository institution disclose the existence of a 
relationship which might provide a basis for additional insurance 
(including the exception provided for in paragraph (b)(1) of this 
section), the details of the relationship and the interests of other 
parties in the account must be ascertainable either from the deposit 
account records of the insured depository institution or from records 
maintained, in good faith and in the regular course of business, by the 
depositor or by some person or entity that has undertaken to maintain 
such records for the depositor.
    (3) Multi-tiered fiduciary relationships. In deposit accounts where 
there are multiple levels of fiduciary relationships, there are two 
methods of satisfying paragraphs (b)(1) and (b)(2) of this section to 
obtain insurance coverage for the interests of the true beneficial 
owners of a deposit account.
    (i) One method is to:
    (A) Expressly indicate, on the deposit account records of the 
insured depository institution, the existence of each and every level of 
fiduciary relationships; and
    (B) Disclose, at each level, the name(s) and interest(s) of the 
person(s) on whose behalf the party at that level is acting.
    (ii) An alternative method is to:
    (A) Expressly indicate, on the deposit account records of the 
insured depository institution, that there are multiple levels of 
fiduciary relationships;
    (B) Disclose the existence of additional levels of fiduciary 
relationships in records, maintained in good faith and in the regular 
course of business, by parties at subsequent levels; and
    (C) Disclose, at each of the levels, the name(s) and interest(s) of 
the person(s) on whose behalf the party at that level is acting. No 
person or entity in the chain of parties will be permitted to claim that 
they are acting in a fiduciary capacity for others unless the possible 
existence of such a relationship is revealed at some previous level in 
the chain.
    (4) Exceptions--(i) Deposits evidenced by negotiable instruments. If 
any deposit obligation of an insured depository institution is evidenced 
by a negotiable certificate of deposit, negotiable draft, negotiable 
cashier's or officer's check, negotiable certified check, negotiable 
traveler's check, letter of credit or other negotiable instrument, the 
FDIC will recognize the owner of such deposit obligation for all 
purposes of claim for insured deposits to the same extent as if his or 
her name and interest were disclosed on the records of the insured 
depository institution; provided, that the instrument was in fact 
negotiated to such owner prior to the date of default of the insured 
depository institution. The owner must provide affirmative proof of such 
negotiation, in a form satisfactory to the FDIC, to substantiate his or 
her claim. Receipt of a negotiable instrument directly from the insured 
depository institution in default shall, in no event, be considered a 
negotiation of said instrument for purposes of this provision.
    (ii) Deposit obligations for payment of items forwarded for 
collection by depository institution acting as agent. Where an insured 
depository institution in default has become obligated for the payment 
of items forwarded for collection by a depository institution acting 
solely as agent, the FDIC will recognize the holders of such items for 
all purposes of claim for insured deposits to the same extent as if 
their name(s) and interest(s) were disclosed as depositors on the 
deposit account records of the insured depository institution, when such 
claim for insured deposits, if otherwise payable, has been established 
by the execution and delivery of prescribed forms. The FDIC will 
recognize such depository institution forwarding such items for the 
holders thereof as agent for such holders for the purpose of making an 
assignment to the FDIC of their rights against the insured depository 
institution in default and for

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the purpose of receiving payment on their behalf.

[63 FR 25756, May 11, 1998, as amended at 64 FR 15656, Apr. 1, 1999]

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    (a) Individual accounts. Funds owned by a natural person and 
deposited in one or more deposit accounts in his or her own name shall 
be added together and insured up to $100,000 in the aggregate. 
Exception: Despite the general requirement in this paragraph (a), if 
more than one natural person has the right to withdraw funds from an 
individual account (excluding persons who have the right to withdraw by 
virtue of a Power of Attorney), the account shall be treated as a joint 
ownership account (although not necessarily a qualifying joint account) 
and shall be insured in accordance with the provisions of Sec. 330.9, 
unless the deposit account records clearly indicate, to the satisfaction 
of the FDIC, that the funds are owned by one individual and that other 
signatories on the account are merely authorized to withdraw funds on 
behalf of the owner.
    (b) Sole proprietorship accounts. Funds owned by a business which is 
a ``sole proprietorship'' (as defined in Sec. 330.1(m)) and deposited in 
one or more deposit accounts in the name of the business shall be 
treated as the individual account(s) of the person who is the sole 
proprietor, added to any other individual accounts of that person, and 
insured up to $100,000 in the aggregate.
    (c) Single-name accounts containing community property funds. 
Community property funds deposited into one or more deposit accounts in 
the name of one member of a husband-wife community shall be treated as 
the individual account(s) of the named member, added to any other 
individual accounts of that person, and insured up to $100,000 in the 
aggregate.
    (d) Accounts of a decedent and accounts held by executors or 
administrators of a decedent's estate. Funds held in the name of a 
decedent or in the name of the executor, administrator, or other 
personal representative of his or her estate and deposited into one or 
more deposit accounts shall be added together and insured up to $100,000 
in the aggregate; provided, however, that nothing in this paragraph (d) 
shall affect the operation of Sec. 330.3(j). The deposit insurance 
provided by this paragraph (d) shall be separate from any insurance 
coverage provided for the individual deposit accounts of the executor, 
administrator, other personal representative or the beneficiaries of the 
estate.

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    (a) Agency or nominee accounts. Funds owned by a principal or 
principals and deposited into one or more deposit accounts in the name 
of an agent, custodian or nominee, shall be insured to the same extent 
as if deposited in the name of the principal(s). When such funds are 
deposited by an insured depository institution acting as a trustee of an 
irrevocable trust, the insurance coverage shall be governed by the 
provisions of Sec. 330.13.
    (b) Guardian, custodian or conservator accounts. Funds held by a 
guardian, custodian, or conservator for the benefit of his or her ward, 
or for the benefit of a minor under the Uniform Gifts to Minors Act, and 
deposited into one or more accounts in the name of the guardian, 
custodian or conservator shall, for purposes of this part, be deemed to 
be agency or nominee accounts and shall be insured in accordance with 
paragraph (a) of this section.
    (c) Accounts held by fiduciaries on behalf of two or more persons. 
Funds held by an agent, nominee, guardian, custodian, conservator or 
loan servicer, on behalf of two or more persons jointly, shall be 
treated as a joint ownership account and shall be insured in accordance 
with the provisions of Sec. 330.9.
    (d) Mortgage servicing accounts. Accounts maintained by a mortgage 
servicer, in a custodial or other fiduciary capacity, which are 
comprised of payments by mortgagors of principal and interest, shall be 
insured in accordance with paragraph (a) of this section for the 
interest of each owner (mortgagee, investor or security holder) in such 
accounts. Accounts maintained by a mortgage servicer, in a custodial or 
other fiduciary capacity, which are comprised of payments by mortgagors 
of taxes and insurance premiums shall

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be added together and insured in accordance with paragraph (a) of this 
section for the ownership interest of each mortgagor in such accounts.
    (e) Custodian accounts for American Indians. Paragraph (a) of this 
section shall not apply to any interest an individual American Indian 
may have in funds deposited by the Bureau of Indian Affairs of the 
United States Department of the Interior (the ``BIA'') on behalf of that 
person pursuant to 25 U.S.C. 162(a), or by any other disbursing agent of 
the United States on behalf of that person pursuant to similar 
authority, in an insured depository institution. The interest of each 
American Indian in all such accounts maintained at the same insured 
depository institution shall be added together and insured, up to 
$100,000, separately from any other accounts maintained by that person 
in the same insured depository institution.

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    (a) Funds held by an insurance company or other corporation in a 
deposit account for the sole purpose of funding life insurance or 
annuity contracts and any benefits incidental to such contracts, shall 
be insured separately in the amount of up to $100,000 per annuitant, 
provided that, pursuant to a state statute:
    (1) The corporation establishes a separate account for such funds;
    (2) The account cannot be charged with the liabilities arising out 
of any other business of the corporation; and
    (3) The account cannot be invaded by other creditors of the 
corporation in the event that the corporation becomes insolvent and its 
assets are liquidated.
    (b) Such insurance coverage shall be separate from the insurance 
provided for any other accounts maintained by the corporation or the 
annuitants at the same insured depository institution.

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    (a) Separate insurance coverage. Qualifying joint accounts, whether 
owned as joint tenants with the right of survivorship, as tenants in 
common or as tenants by the entirety, shall be insured separately from 
any individually owned (single ownership) deposit accounts maintained by 
the co-owners. (Example: If A has a single ownership account and also is 
a joint owner of a qualifying joint account, A's interest in the joint 
account would be insured separately from his or her interest in the 
individual account.) Qualifying joint accounts in the names of both 
husband and wife which are comprised of community property funds shall 
be added together and insured up to $200,000, separately from any funds 
deposited into accounts bearing their individual names.
    (b) Determination of insurance coverage. The interests of each co-
owner in all qualifying joint accounts shall be added together and the 
total shall be insured up to $100,000. (Example: ``A&B'' have a 
qualifying joint account with a balance of $60,000; ``A&C'' have a 
qualifying joint account with a balance of $80,000; and ``A&B&C'' have a 
qualifying joint account with a balance of $150,000. A's combined 
ownership interest in all qualifying joint accounts would be $120,000 
($30,000 plus $40,000 plus $50,000); therefore, A's interest would be 
insured in the amount of $100,000 and uninsured in the amount of 
$20,000. B's combined ownership interest in all qualifying joint 
accounts would be $80,000 ($30,000 plus $50,000); therefore, B's 
interest would be fully insured. C's combined ownership interest in all 
qualifying joint accounts would be $90,000 ($40,000 plus $50,000); 
therefore, C's interest would be fully insured.)
    (c) Qualifying joint accounts. (1) A joint deposit account shall be 
deemed to be a qualifying joint account, for purposes of this section, 
only if:
    (i) All co-owners of the funds in the account are ``natural 
persons'' (as defined in Sec. 330.1(k)); and
    (ii) Each co-owner has personally signed a deposit account signature 
card; and
    (iii) Each co-owner possesses withdrawal rights on the same basis.
    (2) The signature-card requirement of paragraph (c)(1)(ii) of this 
section shall not apply to certificates of deposit, to any deposit 
obligation evidenced by a negotiable instrument, or to any account 
maintained by an agent, nominee, guardian, custodian or conservator on 
behalf of two or more persons.

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    (3) All deposit accounts that satisfy the criteria in paragraph 
(c)(1) of this section, and those accounts that come within the 
exception provided for in paragraph (c)(2) of this section, shall be 
deemed to be jointly owned provided that, in accordance with the 
provisions of Sec. 330.5(a), the FDIC determines that the deposit 
account records of the insured depository institution are clear and 
unambiguous as to the ownership of the accounts. If the deposit account 
records are ambiguous or unclear as to the manner in which the deposit 
accounts are owned, then the FDIC may, in its sole discretion, consider 
evidence other than the deposit account records of the insured 
depository institution for the purpose of establishing the manner in 
which the funds are owned. The signatures of two or more persons on the 
deposit account signature card or the names of two or more persons on a 
certificate of deposit or other deposit instrument shall be conclusive 
evidence that the account is a joint account (although not necessarily a 
qualifying joint account) unless the deposit records as a whole are 
ambiguous and some other evidence indicates, to the satisfaction of the 
FDIC, that there is a contrary ownership capacity.
    (d) Nonqualifying joint accounts. A deposit account held in two or 
more names which is not a qualifying joint account, for purposes of this 
section, shall be treated as being owned by each named owner, as an 
individual, corporation, partnership, or unincorporated association, as 
the case may be, and the actual ownership interest of each individual or 
entity in such account shall be added to any other single ownership 
accounts of such individual or other accounts of such entity, and shall 
be insured in accordance with the provisions of this part governing the 
insurance of such accounts.
    (e) Determination of interests. The interests of the co-owners of 
qualifying joint accounts, held as tenants in common, shall be deemed 
equal, unless otherwise stated in the depository institution's deposit 
account records. This section applies regardless of whether the 
conjunction ``and'' or ``or'' is used in the title of a joint deposit 
account, even when both terms are used, such as in the case of a joint 
deposit account with three or more co-owners.

[63 FR 25756, May 11, 1998, as amended at 64 FR 15656, Apr. 1, 1999; 64 
FR 62102, Nov. 16, 1999]

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    (a) General rule. Funds owned by an individual and deposited into an 
account with respect to which the owner evidences an intention that upon 
his or her death the funds shall belong to one or more qualifying 
beneficiaries shall be insured in the amount of up to $100,000 in the 
aggregate as to each such named qualifying beneficiary, separately from 
any other accounts of the owner or the beneficiaries. For purposes of 
this provision, the term ``qualifying beneficiaries'' means the owner's 
spouse, child/children, grandchild/grandchildren, parent/parents, 
brother/brothers or sister/sisters. (Example: If A establishes a 
qualifying account payable upon death to his spouse, sibling and two 
children, assuming compliance with the rules of this provision, the 
account would be insured up to $400,000 separately from any other 
different types of accounts either A or the beneficiaries may have with 
the same depository institution.) Accounts covered by this provision are 
commonly referred to as tentative or ``Totten trust'' accounts, 
``payable-on-death'' accounts, or revocable trust accounts.
    (b) Required intention. The required intention in paragraph (a) of 
this section that upon the owner's death the funds shall belong to one 
or more qualifying beneficiaries must be manifested in the title of the 
account using commonly accepted terms such as, but not limited to, ``in 
trust for,'' ``as trustee for,'' ``payable-on-death to,'' or any acronym 
therefor. In addition, the beneficiaries must be specifically named in 
the deposit account records of the insured depository institution. The 
settlor of a revocable trust account shall be presumed to own the funds 
deposited into the account.
    (c) Interests of nonqualifying beneficiaries. If a named beneficiary 
of an account covered by this section is not a qualifying beneficiary, 
the funds corresponding to that beneficiary shall be treated as 
individually owned (single

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ownership) accounts of such owner(s), aggregated with any other single 
ownership accounts of such owner(s), and insured up to $100,000 per 
owner. (Examples: If A establishes an account payable upon death to his 
or her nephew, the account would be insured as a single ownership 
account owned by A. Similarly, if B establishes an account payable upon 
death to her husband, son and nephew, two-thirds of the account balance 
would be eligible for POD coverage up to $200,000 corresponding to the 
two qualifying beneficiaries (i.e., the spouse and child). The amount 
corresponding to the non-qualifying beneficiary (i.e., the nephew) would 
be deemed to be owned by B in her single ownership capacity and insured 
accordingly.)
    (d) Joint revocable trust accounts. Where an account described in 
paragraph (a) of this section is established by more than one owner and 
held for the benefit of others, some or all of whom are within the 
qualifying degree of kinship, the respective interests of each owner 
(which shall be deemed equal unless otherwise stated in the insured 
depository institution's deposit account records) held for the benefit 
of each qualifying beneficiary shall be separately insured up to 
$100,000. However, where a husband and a wife establish a revocable 
trust account naming themselves as the sole beneficiaries, such account 
shall not be insured according to the provisions of this section but 
shall instead be insured in accordance with the joint account provisions 
of Sec. 330.9.
    (e) Definition of ``children'', ``grandchildren'', ``parents'', 
``brothers'' and ``sisters''. For the purpose of establishing the 
qualifying degree of kinship identified in paragraph (a) of this 
section, the term ``children'' includes biological, adopted and step-
children of the owner. The term ``grandchildren'' includes biological, 
adopted and step-children of any of the owner's children. The term 
``parents'' includes biological, adoptive and step-parents of the owner. 
The term ``brothers'' includes full brothers, half brothers, brothers 
through adoption and step-brothers. The term ``sisters'' includes full 
sisters, half sisters, sisters through adoption and step-sisters.
    (f) Living trusts. This section also applies to revocable trust 
accounts held in connection with a so-called ``living trust,'' a formal 
trust which an owner creates and retains control over during his or her 
lifetime. If a named beneficiary in a living trust is a qualifying 
beneficiary under this section, then the deposit account held in 
connection with the living trust may be eligible for deposit insurance 
under this section, assuming compliance with all the provisions of this 
part. If, however, for example, the living trust includes a ``defeating 
contingency'' relative to that beneficiary's interest in the trust 
assets, then insurance coverage under this section would not be 
provided. For purposes of this section, a ``defeating contingency'' is 
defined as a condition which would prevent the beneficiary from 
acquiring a vested and non-contingent interest in the funds in the 
deposit account upon the owner's death.

[63 FR 25756, May 11, 1998, as amended at 64 FR 15657, Apr. 1, 1999]

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    (a) Corporate accounts. (1) The deposit accounts of a corporation 
engaged in any ``independent activity'' (as defined in Sec. 330.1(g)) 
shall be added together and insured up to $100,000 in the aggregate. If 
a corporation has divisions or units which are not separately 
incorporated, the deposit accounts of those divisions or units shall be 
added to any other deposit accounts of the corporation. If a corporation 
maintains deposit accounts in a representative or fiduciary capacity, 
such accounts shall not be treated as the deposit accounts of the 
corporation but shall be treated as fiduciary accounts and insured in 
accordance with the provisions of Sec. 330.7.
    (2) Notwithstanding any other provision of this part, any trust or 
other business arrangement which has filed or is required to file a 
registration statement with the Securities and Exchange Commission 
pursuant to section 8 of the Investment Company Act of 1940 or that 
would be required so to register but for the fact it is not created 
under the laws of the United States or a state or but for sections 2(b), 
3(c)(1), or 6(a)(1) of that act shall

[[Page 250]]

be deemed to be a corporation for purposes of determining deposit 
insurance coverage.
    (b) Partnership accounts. The deposit accounts of a partnership 
engaged in any ``independent activity'' (as defined in Sec. 330.1(g)) 
shall be added together and insured up to $100,000 in the aggregate. 
Such insurance coverage shall be separate from any insurance provided 
for individually owned (single ownership) accounts maintained by the 
individual partners. A partnership shall be deemed to exist, for 
purposes of this paragraph, any time there is an association of two or 
more persons or entities formed to carry on, as co-owners, an 
unincorporated business for profit.
    (c) Unincorporated association accounts. The deposit accounts of an 
unincorporated association engaged in any independent activity shall be 
added together and insured up to $100,000 in the aggregate, separately 
from the accounts of the person(s) or entity(ies) comprising the 
unincorporated association. An unincorporated association shall be 
deemed to exist, for purposes of this paragraph, whenever there is an 
association of two or more persons formed for some religious, 
educational, charitable, social or other noncommercial purpose.
    (d) Non-qualifying entities. The deposit accounts of an entity which 
is not engaged in an ``independent activity'' (as defined in 
Sec. 330.1(g)) shall be deemed to be owned by the person or persons 
owning the corporation or comprising the partnership or unincorporated 
association, and, for deposit insurance purposes, the interest of each 
person in such a deposit account shall be added to any other deposit 
accounts individually owned by that person and insured up to $100,000 in 
the aggregate.

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    (a) Separate insurance coverage. ``Trust funds'' (as defined in 
Sec. 330.1(o)) held by an insured depository institution in its capacity 
as trustee of an irrevocable trust, whether held in its trust 
department, held or deposited in any other department of the fiduciary 
institution, or deposited by the fiduciary institution in another 
insured depository institution, shall be insured up to $100,000 for each 
owner or beneficiary represented. This insurance shall be separate from, 
and in addition to, the insurance provided for any other deposits of the 
owners or the beneficiaries.
    (b) Determination of interests. The insurance for funds held by an 
insured depository institution in its capacity as trustee of an 
irrevocable trust shall be determined in accordance with the following 
provisions:
    (1) Allocated funds of a trust estate. If trust funds of a 
particular ``trust estate'' (as defined in Sec. 330.1(n)) are allocated 
by the fiduciary and deposited, the insurance with respect to such trust 
estate shall be determined by ascertaining the amount of its funds 
allocated, deposited and remaining to the credit of the claimant as 
fiduciary at the insured depository institution in default.
    (2) Interest of a trust estate in unallocated trust funds. If funds 
of a particular trust estate are commingled with funds of other trust 
estates and deposited by the fiduciary institution in one or more 
insured depository institutions to the credit of the depository 
institution as fiduciary, without allocation of specific amounts from a 
particular trust estate to an account in such institution(s), the 
percentage interest of that trust estate in the unallocated deposits in 
any institution in default is the same as that trust estate's percentage 
interest in the entire commingled investment pool.
    (c) Limitation on applicability. This section shall not apply to 
deposits of trust funds belonging to a trust which is classified as a 
corporation under Sec. 330.11(a)(2).

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    (a) General rule. Funds representing the ``non-contingent trust 
interest(s)'' (as defined in Sec. 330.1(l)) of a beneficiary deposited 
into one or more deposit accounts established pursuant to one or more 
irrevocable trust agreements created by the same settlor(s) (grantor(s)) 
shall be added together and insured up to $100,000 in the aggregate. 
Such insurance coverage shall be separate from the coverage provided for 
other accounts maintained by the settlor(s),

[[Page 251]]

trustee(s) or beneficiary(ies) of the irrevocable trust(s) at the same 
insured depository institution. Each ``trust interest'' (as defined in 
Sec. 330.1(p)) in any irrevocable trust established by two or more 
settlors shall be deemed to be derived from each settlor pro rata to his 
or her contribution to the trust.
    (b) Treatment of contingent trust interests. In the case of any 
trust in which certain trust interests do not qualify as non-contingent 
trust interests, the funds representing those interests shall be added 
together and insured up to $100,000 in the aggregate. Such insurance 
coverage shall be in addition to the coverage provided for the funds 
representing non-contingent trust interests which are insured pursuant 
to paragraph (a) of this section.
    (c) Commingled accounts of bankruptcy trustees. Whenever a 
bankruptcy trustee appointed under Title 11 of the United States Code 
commingles the funds of various bankruptcy estates in the same account 
at an insured depository institution, the funds of each Title 11 
bankruptcy estate will be added together and insured up to $100,000, 
separately from the funds of any other such estate.

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    (a) ``Pass-through'' insurance. Except as provided in paragraph (b) 
of this section, any deposits of an employee benefit plan or of any 
eligible deferred compensation plan described in section 457 of the 
Internal Revenue Code of 1986 (26 U.S.C. 457) in an insured depository 
institution shall be insured on a ``pass-through'' basis, in the amount 
of up to $100,000 for the non-contingent interest of each plan 
participant, provided that the rules prescribed in Sec. 330.5 are 
satisfied.
    (b) Exception. ``Pass-through'' insurance shall not be provided 
pursuant to paragraph (a) of this section with respect to any deposit 
accepted by an insured depository institution which, at the time the 
deposit is accepted, may not accept brokered deposits pursuant to 
section 29 of the Act (12 U.S.C. 1831f) unless, at the time the deposit 
is accepted:
    (1) The institution meets each applicable capital standard; and
    (2) The depositor receives a written statement from the institution 
indicating that such deposits are eligible for insurance coverage on a 
``pass-through'' basis.
    (c) Aggregation--(1) Multiple plans. Funds representing the non-
contingent interests of a beneficiary in an employee benefit plan, or 
eligible deferred compensation plan described in section 457 of the 
Internal Revenue Code of 1986 (26 U.S.C. 457), which are deposited in 
one or more deposit accounts shall be aggregated with any other 
deposited funds representing such interests of the same beneficiary in 
other employee benefit plans, or eligible deferred compensation plans 
described in section 457 of the Internal Revenue Code of 1986, 
established by the same employer or employee organization.
    (2) Certain retirement accounts. (i) Deposits in an insured 
depository institution made in connection with the following types of 
retirement plans shall be aggregated and insured in the amount of up to 
$100,000 per participant:
    (A) Any individual retirement account described in section 408(a) of 
the Internal Revenue Code of 1986 (26 U.S.C. 408(a));
    (B) Any eligible deferred compensation plan described in section 457 
of the Internal Revenue Code of 1986 (26 U.S.C. 457); and
    (C) Any individual account plan defined in section 3(34) of the 
Employee Retirement Income Security Act (ERISA) (29 U.S.C. 1002) and any 
plan described in section 401(d) of the Internal Revenue Code of 1986 
(26 U.S.C. 401(d)), to the extent that participants and beneficiaries 
under such plans have the right to direct the investment of assets held 
in individual accounts maintained on their behalf by the plans.
    (ii) The provisions of this paragraph (c) shall not apply with 
respect to the deposits of any employee benefit plan, or eligible 
deferred compensation plan described in section 457 of the Internal 
Revenue Code of 1986, which is not entitled to ``pass-through'' 
insurance pursuant to paragraph (b) of this section. Such deposits shall 
be aggregated and insured in the amount of $100,000 per plan.

[[Page 252]]

    (d) Determination of interests--(1) Defined contribution plans. The 
value of an employee's non-contingent interest in a defined contribution 
plan shall be deemed to be the employee's account balance as of the date 
of default of the insured depository institution, regardless of whether 
said amount was derived, in whole or in part, from contributions of the 
employee and/or the employer to the account.
    (2) Defined benefit plans. The value of an employee's non-contingent 
interest in a defined benefit plan shall be deemed to be the present 
value of the employee's interest in the plan, evaluated in accordance 
with the method of calculation ordinarily used under such plan, as of 
the date of default of the insured depository institution.
    (3) Amounts taken into account. For the purposes of applying the 
rule under paragraph (c)(2) of this section, only the present vested and 
ascertainable interests of each participant in an employee benefit plan 
or ``457 Plan,'' excluding any remainder interest created by, or as a 
result of, the plan, shall be taken into account in determining the 
amount of deposit insurance accorded to the deposits of the plan.
    (e) Treatment of contingent interests. In the event that employees' 
interests in an employee benefit plan are not capable of evaluation in 
accordance with the provisions of this section, or an account 
established for any such plan includes amounts for future participants 
in the plan, payment by the FDIC with respect to all such interests 
shall not exceed $100,000 in the aggregate.
    (f) Overfunded pension plan deposits. Any portion of an employee 
benefit plan's deposits which is not attributable to the interests of 
the beneficiaries under the plan shall be deemed attributable to the 
overfunded portion of the plan's assets and shall be aggregated and 
insured up to $100,000, separately from any other deposits.
    (g) Definitions of ``depositor'', ``employee benefit plan'', 
``employee organization'' and ``non-contingent interest''. Except as 
otherwise indicated in this section, for purposes of this section:
    (1) The term depositor means the person(s) administering or managing 
an employee benefit plan.
    (2) The term employee benefit plan has the same meaning given to 
such term in section 3(3) of the Employee Retirement Income Security Act 
of 1974 (ERISA) (29 U.S.C. 1002) and includes any plan described in 
section 401(d) of the Internal Revenue Code of 1986.
    (3) The term employee organization means any labor union, 
organization, employee representation committee, association, group, or 
plan, in which employees participate and which exists for the purpose, 
in whole or in part, of dealing with employers concerning an employee 
benefit plan, or other matters incidental to employment relationships; 
or any employees' beneficiary association organized for the purpose, in 
whole or in part, of establishing such a plan.
    (4) The term non-contingent interest means an interest capable of 
determination without evaluation of contingencies except for those 
covered by the present worth tables and rules of calculation for their 
use set forth in Sec. 20.2031-7 of the Federal Estate Tax Regulations 
(26 CFR 20.2031-7) or any similar present worth or life expectancy 
tables as may be published by the Internal Revenue Service.
    (h) Disclosure of capital status--(1) Disclosure upon request. An 
insured depository institution shall, upon request, provide a clear and 
conspicuous written notice to any depositor of employee benefit plan 
funds of the institution's leverage ratio, Tier 1 risk-based capital 
ratio, total risk-based capital ratio and prompt corrective action (PCA) 
capital category, as defined in the regulations of the institution's 
primary federal regulator, and whether, in the depository institution's 
judgment, employee benefit plan deposits made with the institution, at 
the time the information is requested, would be eligible for ``pass-
through'' insurance coverage under paragraphs (a) and (b) of this 
section. Such notice shall be provided within five business days after 
receipt of the request for disclosure.
    (2) Disclosure upon opening of an account. An insured depository 
institution shall, upon the opening of any account comprised of employee 
benefit

[[Page 253]]

plan funds, provide a clear and conspicuous written notice to the 
depositor consisting of an accurate explanation of the requirements for 
``pass-through'' deposit insurance coverage provided in paragraphs (a) 
and (b) of this section; the institution's PCA capital category; and a 
determination of whether or not, in the depository institution's 
judgment, the funds being deposited are eligible for ``pass-through'' 
insurance coverage.
    (3) Disclosure when ``pass-through'' coverage is no longer 
available. Whenever new, rolled-over or renewed employee benefit plan 
deposits placed with an insured depository institution would no longer 
be eligible for ``pass-through'' insurance coverage, the institution 
shall provide a clear and conspicuous written notice to all existing 
depositors of employee benefit plan funds of its new PCA capital 
category, if applicable, and that new, rolled-over or renewed deposits 
of employee benefit plan funds made after the applicable date shall not 
be eligible for ``pass-through'' insurance coverage under paragraphs (a) 
and (b) of this section. Such written notice shall be provided within 
ten business days after the institution receives notice or is deemed to 
have notice that it is no longer permitted to accept brokered deposits 
under section 29 of the Act and the institution no longer meets the 
requirements in paragraph (b) of this section.
    (4) Definition of ``employee benefit plan''. For purposes of this 
paragraph (h), the term ``employee benefit plan'' has the same meaning 
as provided under paragraph (g)(2) of this section but also includes any 
eligible deferred compensation plans described in section 457 of the 
Internal Revenue Code of 1986 (26 U.S.C. 457).

[63 FR 25756, May 11, 1998, as amended at 64 FR 15657, Apr. 1, 1999]

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    (a) Extent of insurance coverage--(1) Accounts of the United States. 
Each official custodian of funds of the United States lawfully 
depositing such funds in an insured depository institution shall be 
separately insured in the amount of:
    (i) Up to $100,000 in the aggregate for all time and savings 
deposits; and
    (ii) Up to $100,000 in the aggregate for all demand deposits.
    (2) Accounts of a state, county, municipality or political 
subdivision. (i) Each official custodian of funds of any state of the 
United States, or any county, municipality, or political subdivision 
thereof, lawfully depositing such funds in an insured depository 
institution in the state comprising the public unit or wherein the 
public unit is located (including any insured depository institution 
having a branch in said state) shall be separately insured in the amount 
of:
    (A) Up to $100,000 in the aggregate for all time and savings 
deposits; and
    (B) Up to $100,000 in the aggregate for all demand deposits.
    (ii) In addition, each such official custodian depositing such funds 
in an insured depository institution outside of the state comprising the 
public unit or wherein the public unit is located, shall be insured in 
the amount of up to $100,000 in the aggregate for all deposits, 
regardless of whether they are time, savings or demand deposits.
    (3) Accounts of the District of Columbia. (i) Each official 
custodian of funds of the District of Columbia lawfully depositing such 
funds in an insured depository institution in the District of Columbia 
(including an insured depository institution having a branch in the 
District of Columbia) shall be separately insured in the amount of:
    (A) Up to $100,000 in the aggregate for all time and savings 
deposits; and
    (B) Up to $100,000 in the aggregate for all demand deposits.
    (ii) In addition, each such official custodian depositing such funds 
in an insured depository institution outside of the District of Columbia 
shall be insured in the amount of up to $100,000 in the aggregate for 
all deposits, regardless of whether they are time, savings or demand 
deposits.
    (4) Accounts of the Commonwealth of Puerto Rico and other government 
possessions and territories. (i) Each official custodian of funds of the 
Commonwealth of Puerto Rico, the Virgin Islands, American Samoa, the 
Trust Territory of the Pacific Islands, Guam, or The Commonwealth of the 
Northern Mariana Islands, or of any county, municipality, or political 
subdivision

[[Page 254]]

thereof lawfully depositing such funds in an insured depository 
institution in Puerto Rico, the Virgin Islands, American Samoa, the 
Trust Territory of the Pacific Islands, Guam, or The Commonwealth of the 
Northern Mariana Islands, respectively, shall be separately insured in 
the amount of:
    (A) Up to $100,000 in the aggregate for all time and savings 
deposits; and
    (B) Up to $100,000 in the aggregate for all demand deposits.
    (ii) In addition, each such official custodian depositing such funds 
in an insured depository institution outside of the commonwealth, 
possession or territory comprising the public unit or wherein the public 
unit is located, shall be insured in the amount of up to $100,000 in the 
aggregate for all deposits, regardless of whether they are time, savings 
or demand deposits.
    (5) Accounts of an Indian tribe. Each official custodian of funds of 
an Indian tribe (as defined in 25 U.S.C. 1452(c)), including an agency 
thereof having official custody of tribal funds, lawfully depositing the 
same in an insured depository institution shall be separately insured in 
the amount of:
    (i) Up to $100,000 in the aggregate for all time and savings 
deposits; and
    (ii) Up to $100,000 in the aggregate for all demand deposits.
    (b) Rules relating to the ``official custodian''--(1) Qualifications 
for an ``official custodian''. In order to qualify as an ``official 
custodian'' for the purposes of paragraph (a) of this section, such 
custodian must have plenary authority, including control, over funds 
owned by the public unit which the custodian is appointed or elected to 
serve. Control of public funds includes possession, as well as the 
authority to establish accounts for such funds in insured depository 
institutions and to make deposits, withdrawals, and disbursements of 
such funds.
    (2) Official custodian of the funds of more than one public unit. 
For the purposes of paragraph (a) of this section, if the same person is 
an official custodian of the funds of more than one public unit, he or 
she shall be separately insured with respect to the funds held by him or 
her for each such public unit, but shall not be separately insured by 
virtue of holding different offices in such public unit or, except as 
provided in paragraph (c) of this section, holding such funds for 
different purposes.
    (3) Split of authority or control over public unit funds. If the 
exercise of authority or control over the funds of a public unit 
requires action by, or the consent of, two or more officers, employees, 
or agents of such public unit, then they will be treated as one 
``official custodian'' for the purposes of this section.
    (c) Public bond issues. Where an officer, agent or employee of a 
public unit has custody of certain funds which by law or under a bond 
indenture are required to be set aside to discharge a debt owed to the 
holders of notes or bonds issued by the public unit, any deposit of such 
funds in an insured depository institution shall be deemed to be a 
deposit by a trustee of trust funds of which the noteholders or 
bondholders are pro rata beneficiaries, and the beneficial interest of 
each noteholder or bondholder in the deposit shall be separately insured 
up to $100,000.
    (d) Definition of ``political subdivision''. The term ``political 
subdivision'' includes drainage, irrigation, navigation, improvement, 
levee, sanitary, school or power districts, and bridge or port 
authorities and other special districts created by state statute or 
compacts between the states. It also includes any subdivision of a 
public unit mentioned in paragraphs (a)(2), (a)(3) and (a)(4) of this 
section or any principal department of such public unit:
    (1) The creation of which subdivision or department has been 
expressly authorized by the law of such public unit;
    (2) To which some functions of government have been delegated by 
such law; and
    (3) Which is empowered to exercise exclusive control over funds for 
its exclusive use.

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    (a) Prior effective dates. Former Secs. 330.1(j), 330.10(a), 
330.12(c), 330.12(d)(3) and 330.13 (see 12 CFR part 330, as revised 
January 1, 1998) became effective on December 19, 1993.
    (b) Time deposits. Except with respect to the provisions in former 
Sec. 330.12 (a) and (b) (see 12 CFR part 330, as revised January 1, 
l998) and current Sec. 330.14(a)

[[Page 255]]

and (b), any time deposits made before December 19, 1991 that do not 
mature until after December 19, 1993, shall be subject to the rules as 
they existed on the date the deposits were made. Any time deposits made 
after December 19, 1991 but before December 19, 1993, shall be subject 
to the rules as they existed on the date the deposits were made. Any 
rollover or renewal of such time deposits prior to December 19, 1993 
shall subject those deposits to the rules in effect on the date of such 
rollover or renewal. With respect to time deposits which mature only 
after a prescribed notice period, the provisions of this part shall be 
effective on the earliest possible maturity date after June 24, 1993 
assuming (solely for purposes of this section) that notice had been 
given on that date.

                          PART 331  [RESERVED]

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