margin regulations


margin regulations
USA
Regulation U (12 CFR 221) (REG U)
Regulation U. Also known as margin regulations.
The Federal Reserve Board regulation that governs loans made by banks for the purpose of buying securities. The regulation is intended to protect investors and limit speculative bubbles in the securities markets by limiting the amount of credit available to purchase securities. The importance to lenders is that it provides that no more than 50% of the value of the loan can be secured by publicly traded stock; loans made in violation of the regulation are void (Securities Exchange Act of 1934, Section 7).
The former Regulation G (which applied to non-bank, non-broker-dealer lenders in the US before 1998) was rolled into Regulation U.
For further information see Regulation U:

Practical Law Dictionary. Glossary of UK, US and international legal terms. . 2010.

Look at other dictionaries:

  • margin — The edge or border; the edge of a body of water where it meets the land. As applied to a boundary line of land, the margin of a river, creek, or other watercourse means the center of the stream. But in the case of a lake, bay, or natural pond,… …   Black's law dictionary

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  • Regulation U (12 CFR 221) — USA Regulation U (12 CFR 221) (REG U) Regulation U. Also known as margin regulations. The Federal Reserve Board regulation that governs loans made by banks for the purpose of buying securities. The regulation is intended to protect investors and… …   Law dictionary

  • REG U — USA Regulation U (12 CFR 221) (REG U) Regulation U. Also known as margin regulations. The Federal Reserve Board regulation that governs loans made by banks for the purpose of buying securities. The regulation is intended to protect investors and… …   Law dictionary

  • Reg U — USA Regulation U (12 CFR 221) (REG U) Regulation U. Also known as margin regulations. The Federal Reserve Board regulation that governs loans made by banks for the purpose of buying securities. The regulation is intended to protect investors and… …   Law dictionary

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