Section 32.1 - Authority, purpose and scope(a)Authority. This part is issued pursuant to 12 U.S.C. 1 et seq.,12 U.S.C. 84 , 93a , 1462a , 1463 , 1464(u) , and 5412(b)(2)(B) .(b)Purpose. The purpose of this part is to protect the safety and soundness of national banks and savings associations by preventing excessive loans to one person, or to related persons that are financially dependent, and to promote diversification of loans and equitable access to banking services.(c)Scope.(1) Except as provided by paragraphs (c) and (d) of this section, this part applies to all loans and extensions of credit made by national banks and their domestic operating subsidiaries and to all loans and extensions of credit made by savings associations, their operating subsidiaries, and their service corporations that are consolidated under Generally Accepted Accounting Principles (GAAP). For purposes of this part, the term "savings association" includes Federal savings associations and state savings associations, as those terms are defined in 12 U.S.C. 1813(b) .(2) This part does not apply to loans or extensions of credit made to the bank's or savings association's: (i) Affiliates, as that term is defined in 12 U.S.C. 371c(b)(1) and (e) , as implemented by 12 CFR 223.2(a) (Regulation W);(ii) Operating subsidiaries;(iii) Edge Act or Agreement Corporation subsidiaries; or(iv) Any other subsidiary consolidated with the bank or savings association under GAAP.(3) The lending limits in this part are separate and independent from the investment limits prescribed by 12 U.S.C. 24 (Seventh) or 12 U.S.C. 1464(c) , as applicable, and 12 CFR Part 1 and 12 CFR 160.30 , and a national bank or savings association may make loans or extensions of credit to one borrower up to the full amount permitted by this part and also hold eligible securities of the same obligor up to the full amount permitted under 12 U.S.C. 24 (Seventh) or 12 U.S.C. 1464(c) , as applicable, and 12 CFR part 1 and 12 CFR 160.30 .(4) Loans and extensions of credit to executive officers, directors and principal shareholders of national banks, savings associations, and their related interests are subject to limits prescribed by 12 U.S.C. 375a and 375b in addition to the lending limits established by 12 U.S.C. 84 or 12 U.S.C. 1464(u) as applicable, and this part.(5) In addition to the foregoing, loans and extensions of credit must be consistent with safe and sound banking practices.(d)Temporary exception. The requirements of this part shall not apply to the credit exposure arising from a derivative transaction or securities financing transaction until October 1, 2013.60 FR 8532, Feb. 15, 1995, as amended at 73 FR 22251 , Apr. 24, 2008; 77 FR 37275 , June 21, 2012; 77 FR 76842 , Dec. 31, 2012; 78 FR 37943 , June 25, 2013