Business and Personal Finance Dictionary

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• EDGE ACT CORPORATION, EDGE CORPORATION
  
  Definition: A bank subsidiary corporation with a federal or state charter, created under the Edge Act (1919) to engage in international banking and investing. FRB Regulation K defines the equivalent "Edge Corporation" as a corporation formed under section 25(a) of the Federal Reserve Act (12 USC 611-631). (Source: Federal Reserve System Regulation K, 12 CFR 211; as amended effective October 8, 1993.) Application: Unlike its U.S. parent bank, the subsidiary can own a bank outside the U.S. and can invest in foreign commercial and industrial corporations. Comment: The motivation of the act was to allow U.S. firms more flexibility in competing with foreign firms.
  
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