Purpose Credit [Banks & Banking] Law and Legal Definition
According to 12 CFR 220.2 [Title 12 -- Banks and Banking; Chapter II -- Federal Reserve System; Subchapter A -- Board of Governors of the Federal Reserve System; Part 220 -- Credit by Brokers and Dealers (Regulation T)], purpose credit means “credit for the purpose of:
(1) Buying, carrying, or trading in securities; or
(2) Buying or carrying any part of an investment contract security which shall be deemed credit for the purpose of buying or carrying the entire security.”
