California · Financial Code
FIN §1471: (a) Subject to the limitations and exceptions in Sections 1481 and 1510, a bank may hold both obligations made by a person, and securities issued by that same person.
What this law says, in plain English
Banks may hold both debts and securities issued by the same person, subject to certain limitations and exceptions.
Read the full statutory text
(a) Subject to the limitations and exceptions in Sections 1481 and 1510, a bank may hold both obligations made by a person, and securities issued by that same person. (b) The total amount of obligations and securities held by a bank pursuant to subdivision (a) shall not exceed 25 percent of the sum of the shareholders’ equity, allowance for loan and lease losses, capital notes and debentures of the bank.
Verify at the official source: California legislative text
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