Powers and Limitations of the Bank

The Bank, in accordance with its Articles of Agreement, is empowered to provide assistance in the following manner listed under subitems

(a)through (i), and has the limitation listed under subitem

(j)below:

(a)by the preparation, financing, and execution of development plans and projects, including the consideration of priorities, and the formulation of loan proposals on specific national or regional development projects;

(b)by the development and advanced training, through seminars and other forms of instruction of personnel specializing in the formulation and implementation of development plans and projects;

(c)by making or participating indirect loans;

(d)by investment of funds; CH. 1 OFFICE OF I MAGA’HÅGA/MAGA’LÅHI [THE GOVERNOR]

(e)by guaranteeing, whether as primary or secondary obligator, in whole or in part, loans for economic development;

(f)by acquiring and selling such securities, mortgages, bonds and other instrument as may be appropriate to the conduct of its business in the carrying out of its purpose;

(g)to act as, or appoint, attorneys or custodians to administer and supervise funds;

(h)to purchase, lease or dispose of assets, business and property within the limitations of its authority;

(i)to deposit funds in financial institutions in Micronesia, the United States and elsewhere as may be appropriate; and

(j)the Bank is prohibited from engaging in banking activities for the benefit of the general public such as maintaining deposit accounts and paying interest on balances thereon as well as engaging in the trust business or acting as a fiduciary in receiving funds, moneys, properties, or securities, and holding or investing such funds, moneys, properties, or securities for the account of such members of the general public; provided, however, that nothing in this subitem

(j)shall prohibit the Bank from performing any activities for the benefit of its Members as defined in the Agreement, or performing any activity considered to be normal for a development financial institution.