--- kind: "section" citation: "12 U.S.C. § 5212" title: "12" title_heading: "Banks and Banking" number: "5212" heading: "Insurance of troubled assets" release: "119-102" url: "https://uscodex.org/usc/12/5212" units: - "Chapter 52 — Emergency Economic Stabilization" - "Subchapter I — Troubled Assets Relief Program" --- # §5212. Insurance of troubled assets - (a) **Authority—** - (1) **In general—** If the [Secretary](/usc/12/5202.md?p=7) establishes the program authorized under [section 5211 of this title](/usc/12/5211.md), then the [Secretary](/usc/12/5202.md?p=7) shall establish a program to guarantee [troubled assets](/usc/12/5202.md?p=9) originated or issued prior to March 14, 2008, [including](/usc/12/25b.md?p=a-3) [mortgage](/usc/12/1707.md?p=a)-backed securities. - (2) **Guarantees—** In establishing any program under this subsection, the [Secretary](/usc/12/5202.md?p=7) may develop guarantees of [troubled assets](/usc/12/5202.md?p=9) and the associated premiums for such guarantees. Such guarantees and premiums may be determined by category or class of the [troubled assets](/usc/12/5202.md?p=9) to be guaranteed. - (3) **Extent of guarantee—** Upon request of a [financial institution](/usc/12/5202.md?p=5), the [Secretary](/usc/12/5202.md?p=7) may guarantee the timely payment of principal of, and interest on, [troubled assets](/usc/12/5202.md?p=9) in amounts not to exceed 100 percent of such payments. Such guarantee may be on such terms and conditions as are determined by the [Secretary](/usc/12/5202.md?p=7), provided that such terms and conditions are consistent with the purposes of this chapter. - (b) **Reports—** Not later than 90 days after October 3, 2008, the [Secretary](/usc/12/5202.md?p=7) shall report to the [appropriate committees of Congress](/usc/12/5202.md?p=1) on the program established under [subsection (a)](#a). - (c) **Premiums—** - (1) **In general—** The [Secretary](/usc/12/5202.md?p=7) shall collect premiums from any [financial institution](/usc/12/5202.md?p=5) participating in the program established under [subsection (a)](#a). Such premiums shall be in an amount that the [Secretary](/usc/12/5202.md?p=7) determines necessary to meet the purposes of this chapter and to provide sufficient reserves pursuant to [paragraph (3)](#c-3). - (2) **Authority to base premiums on product risk—** In establishing any premium under [paragraph (1)](#c-1), the [Secretary](/usc/12/5202.md?p=7) may provide for variations in such rates according to the [credit](/usc/12/5481.md?p=7) risk associated with the particular troubled asset that is being guaranteed. The [Secretary](/usc/12/5202.md?p=7) shall publish the methodology for setting the premium for a class of [troubled assets](/usc/12/5202.md?p=9) together with an explanation of the appropriateness of the class of assets for [participation](/usc/12/2206a.md?p=a-1) in the program established under this section. The methodology shall ensure that the premium is consistent with [paragraph (3)](#c-3). - (3) **Minimum level—** The premiums referred to in [paragraph (1)](#c-1) shall be set by the [Secretary](/usc/12/5202.md?p=7) at a level necessary to create reserves sufficient to meet anticipated claims, based on an actuarial analysis, and to ensure that taxpayers are fully protected. - (4) **Adjustment to purchase authority—** The purchase authority limit in [section 5225 of this title](/usc/12/5225.md) shall be reduced by an amount equal to the difference between the total of the outstanding guaranteed obligations and the balance in the [Troubled Assets](/usc/12/5202.md?p=9) Insurance Financing [Fund](/usc/12/4702.md?p=10). - (d) **Troubled Assets Insurance Financing Fund—** - (1) **Deposits—** The [Secretary](/usc/12/5202.md?p=7) shall [deposit](/usc/12/5301.md?p=18-A) fees collected under this section into the [Fund](/usc/12/4702.md?p=10) established under [paragraph (2)](#d-2). - (2) **Establishment—** There is established a [Troubled Assets](/usc/12/5202.md?p=9) Insurance Financing [Fund](/usc/12/4702.md?p=10) that shall consist of the amounts collected pursuant to [paragraph (1)](#d-1), and any balance in such [fund](/usc/12/4702.md?p=10) shall be invested by the [Secretary](/usc/12/5202.md?p=7) in United States Treasury securities, or kept in cash on hand or on [deposit](/usc/12/5301.md?p=18-A), as necessary. - (3) **Payments from Fund—** The [Secretary](/usc/12/5202.md?p=7) shall make payments from amounts deposited in the [Fund](/usc/12/4702.md?p=10) to fulfill obligations of the guarantees provided to [financial institutions](/usc/12/5202.md?p=5) under [subsection (a)](#a). ## Source credit (Pub. L. 110–343, div. A, title I, § 102, Oct. 3, 2008, 122 Stat. 3768.) ## Notes ### Editorial Notes ### References in Text This chapter, referred to in subsecs. (a)(3) and (c)(1), was in the original “this Act” and was translated as reading “this division”, meaning div. A of Pub. L. 110–343, Oct. 3, 2008, 122 Stat. 3765, known as the Emergency Economic Stabilization Act of 2008, to reflect the probable intent of Congress. For complete classification of division A to the Code, see Short Title note set out under section 5201 of this title and Tables.