Resolution Trust Corporation Loss Reduction and Funding Act of 1993

Summary: Resolution Trust Corporation Loss Reduction and Funding Act of 1993 - Amends the Federal Home Loan Bank Act to direct the Secretary of the Treasury to provide additional funding to the Resolution Trust Corporation (RTC). 
Prohibits any court from taking into account the supervisory goodwill buy-back program (established by this Act) when considering litigation between certain savings associations and the United States. 
Sets guidelines for a supervisory goodwill buy-back program which replaces the supervisory goodwill of a qualified savings association with tangible capital (thus precluding the closing of such institutions).  Provides that if a qualified savings association meets all fully phased in capital standards after receiving funds for its goodwill, then such standards will apply to the association. 
Prescribes annual assessment guidelines for such qualified savings associations.  Prohibits a savings association from making any capital distribution or paying any dividend until the sum of its imposed assessments equals or exceeds the replacement amount it has received. 
Requires the Director of the Office of Thrift Supervision to promptly determine upon enactment of this Act those savings associations eligible for inclusion in the supervisory goodwill buy-back program.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Resolution Trust Corporation Loss 
Reduction and Funding Act of 1993''.

SEC. 2. FUNDING.

    Section 21A(i) of the Federal Home Loan Bank Act (12 U.S.C. 
1441a(i)) is amended--
            (1) in paragraph (3), by striking ``until April 1, 1992''; 
        and
            (2) by adding at the end the following new paragraphs:
            ``(4) Additional funding.--Pursuant to the request of the 
        President and in addition to amounts provided under paragraphs 
        (2) and (3), the Secretary of the Treasury shall provide, out 
        of any money in the Treasury not otherwise appropriated, to the 
        Corporation such sums as may be necessary not to exceed 
        $25,000,000,000 to carry out the purposes of this section until 
        April 1, 1994.
            ``(5) Reduction in funding in amount equal to supervisory 
        goodwill buy-back program savings.--Of the amounts appropriated 
        under paragraphs (3) and (4), the amount available for 
        obligation shall be reduced by the amount which the Secretary 
        determines is equal to the net reduction in the expenditures of 
        the Corporation due to the supervisory goodwill buy-back 
        program established under section 15 of the Home Owners' Loan 
        Act.''.

SEC. 3. REDUCTION OF RTC LOSSES.

    (a) Purpose.--
            (1) In general.--It is the purpose of this section to 
        directly reduce the amount of taxpayer funds which would 
        otherwise be required to be appropriated to the Resolution 
        Trust Corporation by removing the threat of large losses which 
        would accrue in connection with the resolution of savings 
        associations which would be healthy associations but for the 
        supervisory goodwill acquired by such associations in 
        transactions with Federal regulatory agencies.
            (2) No effect on supervisory goodwill litigation not 
        involving qualified savings associations.--No court may take 
        into account section 15 of the Home Owners' Loan Act (as added 
        by the amendment made by subsection (b)) or the program 
        established under such section 15 in considering any litigation 
        between any savings association which is not a qualified 
        savings association (as defined in such section 15) and the 
        United States with regard to supervisory goodwill.
    (b) Establishment of Supervisory Goodwill Buy-Back Program.--The 
Home Owners' Loan Act (12 U.S.C. 1461 et seq.) is amended by adding at 
the end the following new section:

``SEC. 15. SUPERVISORY GOODWILL BUY-BACK PROGRAM.

    ``(a) Supervisory Goodwill Replaced With Tangible Capital.--
            ``(1) In general.--Upon determining that a conservator or 
        receiver is to be appointed for a savings association on or 
        before the last day on which the Corporation may be appointed 
        as conservator or receiver for a savings association in 
        accordance with section 21A(b)(3)(A)(ii) of the Federal Home 
        Loan Bank Act if no action is taken under this section, the 
        Director shall, in consultation with the Resolution Trust 
        Corporation--
                    ``(A) determine whether the savings association is 
                a qualified savings association; and
                    ``(B) if the association is a qualified savings 
                association, pay the association the replacement amount 
                from amounts made available pursuant to subsection (f).
            ``(2) Reduction in supervisory goodwill.--On receipt of any 
        payment under paragraph (1), a qualified savings association 
        shall reduce its supervisory goodwill by the amount of such 
        payment.
    ``(b) Definitions.--For purposes of this section--
            ``(1) Qualified savings association.--The term `qualified 
        savings association' means a savings association described in 
        subsection (a)(1) which--
                    ``(A) would be, in the determination of the 
                Director, a viable association, and would not be 
                expected to fail, if the association participates in 
                the program; and
                    ``(B) has agreed to waive all claims the 
                association may have against the Federal Government 
                arising from changes in the statutory treatment of 
                supervisory goodwill as set forth in section 5(t) since 
                the creation of such goodwill on the books of the 
                association.
            ``(2) Replacement amount.--The term `replacement amount' 
        means, with respect to a qualified savings association, the 
        lesser of--
                    ``(A) the determined amount; and
                    ``(B) the least amount that, if paid to the 
                association, would cause the association to be 
                adequately capitalized (as defined in section 38 of the 
                Federal Deposit Insurance Act) under all fully phased 
                in capital standards.
            ``(3) Determined amount.--The term `determined amount' 
        means, with respect to a savings association, an amount 
        determined appropriate by the Office of Thrift Supervision, 
        taking into account the circumstances of the association, which 
        is--
                    ``(A) not less than the amount of the supervisory 
                goodwill of the association, as of the date of the 
                determination; and
                    ``(B) not more than the amount of the supervisory 
                goodwill of the association, as of the date of the 
                enactment of the Financial Institutions Reform, 
                Recovery, and Enforcement Act of 1989.
    ``(c) Capital Requirements.--
            ``(1) Fully phased in capital standards.--If, after receipt 
        of funds pursuant to subsection (a), a qualified savings 
        association meets all fully phased in capital standards, then 
        such standards shall apply to the association, notwithstanding 
        any other provision of law.
            ``(2) Additional requirements.--The Office of Thrift 
        Supervision may set additional capital requirements for 
        qualified savings associations to ensure that such associations 
        will progressively prepare to meet all applicable capital 
        requirements.
    ``(d) Assessment Imposed.--
            ``(1) In general.--The Director shall impose an annual 
        assessment on each qualified savings association which receives 
        the payment of any amount pursuant to subsection (a)(2)--
                    ``(A) beginning on or after the date of a 
                determination by the Director that the savings 
                association is sufficiently viable to begin paying such 
                assessment; and
                    ``(B) continuing until the aggregate amount of 
                assessments paid under this subsection by the 
                association equals or exceeds the aggregate amount 
                received under subsection (a)(2) by the association.
            ``(2) Amount of assessment.--The amount of the annual 
        assessment imposed on any savings association for any year 
        shall be determined by the Director after considering--
                    ``(A) the viability and profitability of the 
                association;
                    ``(B) the amortization period which was applicable 
                with respect to any supervisory goodwill of the 
                association as of the date such goodwill was first 
                entered on the books of the association; and
                    ``(C) the amount received by the association 
                pursuant to subsection (a)(2).
            ``(3) Deposit of assessments in treasury.--
                    ``(A) Transfer to secretary of the treasury.--All 
                amounts received by the Director under this subsection 
                shall be transferred to the Secretary of the Treasury.
                    ``(B) Public debt reduction.--Amounts received by 
                the Secretary of the Treasury under subparagraph (A) 
                shall be deposited in the general fund of the Treasury 
                and shall be used for the sole purpose of reducing the 
                national debt.
    ``(e) Additional Limitations and Requirements.--
            ``(1) Limitation on distribution of capital or payment of 
        dividends.--No savings association may make any capital 
        distribution or pay any dividend until the sum of the amount of 
        the assessments imposed under subsection (d) equals or exceeds 
        the replacement amount received by such association under 
        subsection (a)(1)(B).
            ``(2) Other requirements.--The Office of Thrift Supervision 
        may establish any other requirements needed to ensure the safe 
        and sound operation of qualified savings associations.
    ``(f) Funding Provided by RTC.--The Resolution Trust Corporation 
shall provide such funds as may be necessary to carry out this section 
to the Director of the Office of Thrift Supervision from amounts made 
available to the Corporation under section 21A of the Federal Home Loan 
Bank Act.''.
    (c) Applicability to Certain Associations.--Upon the enactment of 
this Act, the Director of the Office of Thrift Supervision shall 
promptly make the determination required under section 15(a)(1)(A) of 
the Home Owners' Loan Act (as added by subsection (a) of this section) 
for any savings association for which the determination to appoint a 
conservator or receiver had been made before the date of the enactment 
of this Act but for which a conservator or receiver had not been 
appointed as of such date.