Regulation X deals with what type of borrowers?

Regulation X, promulgated by the Federal Reserve, primarily pertains to the extension of credit for the purpose of purchasing or carrying securities. It is specifically designed to govern the terms under which financial institutions can extend credit to borrowers for these purposes, ensuring compliance with margin requirements set forth by federal law.

The regulation establishes rules that limit the amount of credit that can be provided based on the value of the securities being purchased. This regulation is crucial in maintaining a balanced approach to lending in the securities markets, preventing excessive borrowing against securities that could lead to financial instability.

While other choices involve different aspects of banking and financial regulation, they do not pertain directly to Regulation X's focus on securities credit. Thus, the connection of Regulation X with the specific type of borrower who engages in practices related to securities credit highlights the regulation's significance in protecting both lenders and borrowers in the financial system.