Examination Parity and Year 2000 Readiness for Financial Institutions Act

Summary: Examination Parity and Year 2000 Readiness for Financial Institutions Act - Requires each Federal banking agency and the National Credit Union Administration Board (Board) to offer seminars to all depository institutions and insured credit unions under their respective jurisdictions on the implication of the Year 2000 computer problem for:  (1) the safety and soundness of such institutions; and (2) their transactions with other financial institutions (including Federal reserve banks and Federal home loan banks).  Requires such agencies and the Board to make available to all the institutions under their jurisdiction model approaches to common Year 2000 computer problems with regard to project management, vendor contracts, testing regimes, and business continuity planning. 
Defines Year 2000 computer problem as any problem which prevents information technology from accurately processing, calculating, comparing, or sequencing date or time data:  (1) from, into, or between the 20th and 21st centuries, or the years 1999 and 2000; or (2) with regard to leap year calculations. 
Amends the Home Owners' Loan Act to place under the regulatory authority of the Director of the Office of Thrift Supervision a service corporation or subsidiary owned by a savings association. Permits the Director to authorize any other Federal banking agency to examine the service corporation or subsidiary if the agency supervises any other person maintaining an ownership interest in it.  Subjects the corporation or subsidiary to the insurance termination prescriptions of the Federal Deposit Insurance Act. 
Provides that if such service corporation or subsidiary causes services to be performed for itself that are also authorized under this Act, such services shall also fall within the Director's regulatory purview. 
Amends the Federal Credit Union Act to subject a credit union organization owned in whole or in part by an insured credit union to examination and regulation by the Board to the same extent as an insured credit union.  Permits the Board to authorize any other Federal agency to examine a credit union organization if such agency has supervisory authority over any activity of a credit union organization, or over any person maintaining an ownership interest in such organization. 
Subjects such corporation or subsidiary to the insurance termination and disciplinary requirements of the Federal Credit Union Act. 
Provides that if an insured credit union or credit union organization causes services to be performed for itself that are also authorized under this Act, such services shall also fall within the Board's regulatory purview. 
Terminates all power and authority conferred upon the Board by this Act as of December 31, 2001.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Examination Parity and Year 2000 
Readiness for Financial Institutions Act''.

SEC. 2. YEAR 2000 READINESS FOR FINANCIAL INSTITUTIONS.

    (a) Findings.--The Congress finds that--
            (1) the Year 2000 computer problem poses a serious 
        challenge to the American economy, including the Nation's 
        banking and financial services industries;
            (2) thousands of banks, savings associations, and credit 
        unions rely heavily on internal information technology and 
        computer systems, as well as outside service providers, for 
        mission-critical functions, such as check clearing, direct 
        deposit, accounting, automated teller machine networks, credit 
        card processing, and data exchanges with domestic and 
        international borrowers, customers, and other financial 
        institutions; and
            (3) Federal financial regulatory agencies must have 
        sufficient examination authority to ensure that the safety and 
        soundness of the Nation's financial institutions will not be at 
        risk.
    (b) Definitions.--For purposes of this section--
            (1) the terms ``depository institution'' and ``Federal 
        banking agency'' have the same meanings as in section 3 of the 
        Federal Deposit Insurance Act;
            (2) the term ``Federal home loan bank'' has the same 
        meaning as in section 2 of the Federal Home Loan Bank Act;
            (3) the term ``Federal reserve bank'' means a reserve bank 
        established under the Federal Reserve Act;
            (4) the term ``insured credit union'' has the same meaning 
        as in section 101 of the Federal Credit Union Act; and
            (5) the term ``Year 2000 computer problem'' means, with 
        respect to information technology, any problem which prevents 
        such technology from accurately processing, calculating, 
        comparing, or sequencing date or time data--
                    (A) from, into, or between--
                            (i) the 20th and 21st centuries; or
                            (ii) the years 1999 and 2000; or
                    (B) with regard to leap year calculations.
    (c) Seminars and Model Approaches to Year 2000 Computer Problem.--
            (1) Seminars.--
                    (A) In general.--Each Federal banking agency and 
                the National Credit Union Administration Board shall 
                offer seminars to all depository institutions and 
                insured credit unions under the jurisdiction of such 
                agency on the implication of the Year 2000 computer 
                problem for--
                            (i) the safe and sound operations of such 
                        depository institutions and credit unions; and
                            (ii) transactions with other financial 
                        institutions, including Federal reserve banks 
                        and Federal home loan banks.
                    (B) Content and schedule.--The content and schedule 
                of seminars offered pursuant to subparagraph (A) shall 
                be determined by each Federal banking agency and the 
                National Credit Union Administration Board taking into 
                account the resources and examination priorities of 
                such agency.
            (2) Model approaches.--
                    (A) In general.--Each Federal banking agency and 
                the National Credit Union Administration Board shall 
                make available to each depository institution and 
                insured credit union under the jurisdiction of such 
                agency model approaches to common Year 2000 computer 
                problems, such as model approaches with regard to 
                project management, vendor contracts, testing regimes, 
                and business continuity planning.
                    (B) Variety of approaches.--In developing model 
                approaches to the Year 2000 computer problem pursuant 
                to subparagraph (A), each Federal banking agency and 
                the National Credit Union Administration Board shall 
                take into account the need to develop a variety of 
                approaches to correspond to the variety of depository 
                institutions or credit unions within the jurisdiction 
                of the agency.
            (3) Cooperation.--In carrying out this section, the Federal 
        banking agencies and the National Credit Union Administration 
        Board may cooperate and coordinate their activities with each 
        other, the Financial Institutions Examination Council, and 
        appropriate organizations representing depository institutions 
        and credit unions.

SEC. 3. REGULATION AND EXAMINATION OF SERVICE PROVIDERS.

    (a) Regulation and Examination of Savings Association Service 
Companies.--
            (1) Amendment to home owners' loan act.--Section 5(d) of 
        the Home Owners' Loan Act (12 U.S.C. 1464(d)) is amended by 
        adding at the end the following:
            ``(7) Regulation and examination of savings association 
        service companies, subsidiaries, and service providers.--
                    ``(A) General examination and regulatory 
                authority.--A service company or subsidiary that is 
                owned in whole or in part by a savings association 
                shall be subject to examination and regulation by the 
                Director to the same extent as that savings 
                association.
                    ``(B) Examination by other banking agencies.--The 
                Director may authorize any other Federal banking agency 
                that supervises any other owner of part of the service 
                company or subsidiary to perform an examination 
                described in subparagraph (A).
                    ``(C) Applicability of section 8 of the federal 
                deposit insurance act.--A service company or subsidiary 
                that is owned in whole or in part by a saving 
                association shall be subject to the provisions of 
                section 8 of the Federal Deposit Insurance Act as if 
                the service company or subsidiary were an insured 
                depository institution. In any such case, the Director 
                shall be deemed to be the appropriate Federal banking 
                agency, pursuant to section 3(q) of the Federal Deposit 
                Insurance Act.
                    ``(D) Service performed by contract or otherwise.--
                Notwithstanding subparagraph (A), if a savings 
                association, a subsidiary thereof, or any savings and 
                loan affiliate or entity, as identified by section 
                8(b)(9) of the Federal Deposit Insurance Act, that is 
                regularly examined or subject to examination by the 
                Director, causes to be performed for itself, by 
                contract or otherwise, any service authorized under 
                this Act or, in the case of a State savings 
                association, any applicable State law, whether on or 
                off its premises--
                            ``(i) such performance shall be subject to 
                        regulation and examination by the Director to 
                        the same extent as if such services were being 
                        performed by the savings association on its own 
                        premises; and
                            ``(ii) the savings association shall notify 
                        the Director of the existence of the service 
                        relationship not later than 30 days after the 
                        earlier of--
                                    ``(I) the date on which the 
                                contract is entered into; or
                                    ``(II) the date on which the 
                                performance of the service is 
                                initiated.
                    ``(E) Administration by the director.--The Director 
                may issue such regulations and orders, including those 
                issued pursuant to section 8 of the Federal Deposit 
                Insurance Act, as may be necessary to enable the 
                Director to administer and carry out this paragraph and 
                to prevent evasion of this paragraph.
            ``(8) Definitions.--For purposes of this section--
                    ``(A) the term `service company' means--
                            ``(i) any corporation--
                                    ``(I) that is organized to perform 
                                services authorized by this Act or, in 
                                the case of a corporation owned in part 
                                by a State savings association, 
                                authorized by applicable State law; and
                                    ``(II) all of the capital stock of 
                                which is owned by 1 or more insured 
                                savings associations; and
                            ``(ii) any limited liability company--
                                    ``(I) that is organized to perform 
                                services authorized by this Act or, in 
                                the case of a company, 1 of the members 
                                of which is a State savings 
                                association, authorized by applicable 
                                State law; and
                                    ``(II) all of the members of which 
                                are 1 or more insured savings 
                                associations;
                    ``(B) the term `limited liability company' means 
                any company, partnership, trust, or similar business 
                entity organized under the law of a State (as defined 
                in section 3 of the Federal Deposit Insurance Act) that 
                provides that a member or manager of such company is 
                not personally liable for a debt, obligation, or 
                liability of the company solely by reason of being, or 
                acting as, a member or manager of such company; and
                    ``(C) the terms `State savings association' and 
                `subsidiary' have the same meanings as in section 3 of 
                the Federal Deposit Insurance Act.''.
            (2) Conforming amendments to section 8 of the federal 
        deposit insurance act.--Section 8 of the Federal Deposit 
        Insurance Act (12 U.S.C. 1818) is amended--
                    (A) in subsection (b)(9), by striking ``to any 
                service corporation of a savings association and to any 
                subsidiary of such service corporation'';
                    (B) in subsection (e)(7)(A)(ii), by striking 
                ``(b)(8)'' and inserting ``(b)(9)''; and
                    (C) in subsection (j)(2), by striking ``(b)(8)'' 
                and inserting ``(b)(9)''.
    (b) Regulation and Examination of Service Providers for Credit 
Unions.--Title II of the Federal Credit Union Act (12 U.S.C. 1781 et 
seq.) is amended by inserting after section 206 the following new 
section:

``SEC. 206A. REGULATION AND EXAMINATION OF CREDIT UNION ORGANIZATIONS 
              AND SERVICE PROVIDERS.

    ``(a) Regulation and Examination of Credit Union Organizations.--
            ``(1) General examination and regulatory authority.--A 
        credit union organization shall be subject to examination and 
        regulation by the Board to the same extent as that insured 
        credit union.
            ``(2) Examination by other banking agencies.--The Board may 
        authorize to make an examination of a credit union organization 
        in accordance with paragraph (1)--
                    ``(A) any Federal regulator agency that supervises 
                any activity of a credit union organization; or
                    ``(B) any Federal banking agency that supervises 
                any other person who maintains an ownership interest in 
                a credit union organization.
    ``(b) Applicability of Section 206.--A credit union organization 
shall be subject to the provisions of section 206 as if the credit 
union organization were an insured credit union.
    ``(c) Service Performed by Contract or Otherwise.--Notwithstanding 
subsection (a), if an insured credit union or a credit union 
organization that is regularly examined or subject to examination by 
the Board, causes to be performed for itself, by contract or otherwise, 
any service authorized under this Act or, in the case of a State credit 
union, any applicable State law, whether on or off its premises--
            ``(1) such performance shall be subject to regulation and 
        examination by the Board to the same extent as if such services 
        were being performed by the insured credit union or credit 
        union organization itself on its own premises; and
            ``(2) the insured credit union or credit union organization 
        shall notify the Board of the existence of the service 
        relationship not later than 30 days after the earlier of--
                    ``(A) the date on which the contract is entered 
                into; or
                    ``(B) the date on which the performance of the 
                service is initiated.
    ``(d) Administration by the Board.--The Board may issue such 
regulations and orders as may be necessary to enable the Board to 
administer and carry out this section and to prevent evasion of this 
section.
    ``(e) Definitions.--For purposes of this section--
            ``(1) the term `credit union organization' means any entity 
        that--
                    ``(A) is not a credit union;
                    ``(B) is an entity in which an insured credit union 
                may lawfully hold an ownership interest or investment; 
                and
                    ``(C) is owned in whole or in part by an insured 
                credit union; and
            ``(2) the term `Federal banking agency' has the same 
        meaning as in section 3 of the Federal Deposit Insurance Act.
    ``(f) Expiration of Authority.--This section and all powers and 
authority of the Board under this section shall cease to be effective 
as of December 31, 2001.''.