Notice: Function _load_textdomain_just_in_time was called incorrectly. Translation loading for the wp-migrate-db domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /srv/app/gotoiba-dev/htdocs/web/wp-includes/functions.php on line 6121
Under Regulation U, may a customer pledge stock as security for a loan? – IBA Compliance Connection

IBA Compliance Connection

Your go to source for compliance!

Under Regulation U, may a customer pledge stock as security for a loan?

—

by

We do not believe that Regulation U would apply. The rule states that its restrictions apply to lenders that “extend credit for the purpose of buying or carrying margin stock.” 12 CFR 221.1. Therefore, Regulation U would not apply to a transaction in which the customer uses the stock as security for a loan (and is not using the loan proceeds to purchase margin stock).