12 CFR § 242.1 - Authority and purpose.

---
identifier: "/us/cfr/t12/s242.1"
source: "ecfr"
legal_status: "authoritative_unofficial"
title: "12 CFR § 242.1 - Authority and purpose."
title_number: 12
title_name: "Banks and Banking"
section_number: "242.1"
section_name: "Authority and purpose."
chapter_name: "FEDERAL RESERVE SYSTEM"
subchapter_number: "A"
subchapter_name: "BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM"
part_number: "242"
part_name: "DEFINITIONS RELATING TO TITLE I OF THE DODD-FRANK ACT (REGULATION PP)"
positive_law: false
currency: "2026-04-05"
last_updated: "2026-04-05"
format_version: "1.1.0"
generator: "[email protected]"
authority: "12 U.S.C. 5311."
regulatory_source: "78 FR 20776, Apr. 5, 2013, unless otherwise noted."
cfr_part: "242"
---


# 242.1 Authority and purpose.

(a) *Authority.* This part is issued by the Board pursuant to sections 102(a)(7) and (b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) (12 U.S.C. 5311(a)(7) and (b)).

(b) *Purpose.* (1) This part establishes the criteria for determining if a company is “predominantly engaged in financial activities” as required under section 102(b) of the Dodd-Frank Act (12 U.S.C. 5311(b)) for purposes of Title I of the Dodd-Frank Act.

(2) This part defines the terms “significant nonbank financial company” and “significant bank holding company” as provided in section 102(a)(6) of the Dodd-Frank Act for purposes of—

(i) Section 113 of the Dodd-Frank Act (12 U.S.C. 5323) relating to the designation of nonbank financial companies by the Financial Stability Oversight Council (Council) for supervision by the Board; and

(ii) Section 165(d)(2) of the Dodd-Frank Act (12 U.S.C. 5365(d)(2)) relating to the credit exposure reports required to be filed by—

(A) A nonbank financial company supervised by the Board; and

(B) A bank holding company or foreign bank subject to the Bank Holding Company Act (BHC Act) (12 U.S.C. 1841 *et seq.*) that is a bank holding company described in section 165(a) of the Dodd-Frank Act (12 U.S.C. 5365(a)).

[78 FR 20776, Apr. 5, 2013, as amended at 84 FR 59096, Nov. 1, 2019]