I 

113TH CONGRESS 

1ST SESSION H. R. 1750 

To enhance the ability of community financial institutions to foster economic 

growth and serve their communities, boost small businesses, increase 

individual savings, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 25, 2013 

Mr. LUETKEMEYER (for himself, Mr. WESTMORELAND, and Mr. GARY G. 

MILLER of California) introduced the following bill; which was referred 

to the Committee on Financial Services 

A BILL 

To enhance the ability of community financial institutions 

to foster economic growth and serve their communities, 

boost small businesses, increase individual savings, and 

for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Community Lending Enhancement and Regulatory Re6 lief Act of 2013’’ or the ‘‘CLEAR Relief Act of 2013’’. 

7 (b) TABLE OF CONTENTS.—The table of contents for 

8 this Act is as follows: 


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Sec. 1. Short title; table of contents. 

Sec. 2. Changes required to small bank holding company policy statement on 

assessment of financial and managerial factors. 

Sec. 3. Escrow requirements. 

Sec. 4. Exception to annual privacy notice requirement under the GrammLeach-Bliley Act. 

Sec. 5. Accounting principles cost-benefit requirements. 

Sec. 6. Community bank exemption from annual management assessment of internal controls requirement of the Sarbanes-Oxley Act of 2002. 

Sec. 7. Certain loans included as qualified mortgages. 

Sec. 8. Increase in small servicer exemption. 

Sec. 9. Appraiser qualification threshold. 

Sec. 10. Coordination among financial institutions. 

1 SEC. 2. CHANGES REQUIRED TO SMALL BANK HOLDING 

2 COMPANY POLICY STATEMENT ON ASSESS3 MENT OF FINANCIAL AND MANAGERIAL FAC4 TORS. 

5 (a) SMALL BANK HOLDING COMPANY POLICY

6 STATEMENT ON ASSESSMENT OF FINANCIAL AND MANA7 GERIAL FACTORS.— 

8 (1) IN GENERAL.—Before the end of the 6- 

9 month period beginning on the date of the enact10 ment of this Act, the Board of Governors of the 

11 Federal Reserve System shall publish in the Federal 

12 Register proposed revisions to the Small Bank Hold13 ing Company Policy Statement on Assessment of Fi14 nancial and Managerial Factors (12 C.F.R. part 

15 225—appendix C) that provide that the policy shall 

16 apply to a bank holding company which has pro 

17 forma consolidated assets of less than 

18 $5,000,000,000 and that— 


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1 (A) is not engaged in any nonbanking ac2 tivities involving significant leverage; and 

3 (B) does not have a significant amount of 

4 outstanding debt that is held by the general 

5 public. 

6 (2) ADJUSTMENT OF AMOUNT.—The Board of 

7 Governors of the Federal Reserve System shall an8 nually adjust the dollar amount referred to in para9 graph (1) in the Small Bank Holding Company Pol10 icy Statement on Assessment of Financial and Man11 agerial Factors by an amount equal to the percent12 age increase, for the most recent year, in total assets 

13 held by all insured depository institutions, as deter14 mined by the Board. 

15 (b) INCREASE IN DEBT-TO-EQUITY RATIO OF SMALL

16 BANK HOLDING COMPANY.—Before the end of the 6- 

17 month period beginning on the date of the enactment of 

18 this Act, the Board of Governors of the Federal Reserve 

19 System shall publish in the Federal Register proposed re20 visions to the Small Bank Holding Company Policy State21 ment on Assessment of Financial and Managerial Factors 

22 (12 C.F.R. part 225—appendix C) such that the debt-to23 equity ratio allowable for a small bank holding company 

24 in order to remain eligible to pay a corporate dividend and 

25 to remain eligible for expedited processing procedures 


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1 under Regulation Y of the Board of Governors of the Fed2 eral Reserve System would increase from 1:1 to 3:1. 

3 SEC. 3. ESCROW REQUIREMENTS. 

4 (a) IN GENERAL.—Section 129D(c) of the Truth in 

5 Lending Act, as added by section 1461(a) of the Dodd6 Frank Wall Street Reform and Consumer Protection Act, 

7 is amended— 

8 (1) by redesignating paragraphs (1), (2), (3), 

9 and (4) as subparagraphs (A), (B), (C), and (D) 

10 and moving such subparagraphs 2 ems to the right; 

11 (2) striking ‘‘The Board’’ and inserting the fol12 lowing: 

13 ‘‘(1) IN GENERAL.—The Board’’; and 

14 (3) by adding at the end the following new 

15 paragraph: 

16 ‘‘(2) TREATMENT OF LOANS HELD BY SMALLER

17 CREDITORS.—The Board shall, by regulation, exempt 

18 from the requirements of subsection (a) any loan secured 

19 by a first lien on a consumer’s principle dwelling, if such 

20 loan is held by a creditor with assets of $10,000,000,000 

21 or less.’’. 


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1 SEC. 4. EXCEPTION TO ANNUAL PRIVACY NOTICE REQUIRE2 MENT UNDER THE GRAMM-LEACH-BLILEY 

3 ACT. 

4 Section 503 of the Gramm-Leach-Bliley Act (15 

5 U.S.C. 6803) is amended by adding at the end the fol6 lowing: 

7 ‘‘(f) EXCEPTION TO ANNUAL NOTICE REQUIRE8 MENT.—A financial institution that— 

9 ‘‘(1) provides nonpublic personal information 

10 only in accordance with the provisions of subsection 

11 (b)(2) or (e) of section 502 or regulations prescribed 

12 under section 504(b), and 

13 ‘‘(2) has not changed its policies and practices 

14 with regard to disclosing nonpublic personal infor15 mation from the policies and practices that were dis16 closed in the most recent disclosure sent to con17 sumers in accordance with this subsection, 

18 shall not be required to provide an annual disclosure under 

19 this subsection until such time as the financial institution 

20 fails to comply with any criteria described in paragraph 

21 (1) or (2).’’. 

22 SEC. 5. ACCOUNTING PRINCIPLES COST-BENEFIT REQUIRE23 MENTS. 

24 Section 19(b) of the Securities Act of 1933 (15 

25 U.S.C. 77s(b)) is amended by adding at the end the fol26 lowing: 


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1 ‘‘(3) GENERALLY ACCEPTED ACCOUNTING

2 PRINCIPLES COST-BENEFIT REQUIREMENTS.—The 

3 Commission or its designee shall conduct analyses of 

4 the costs and benefits (including economic benefits) 

5 of any new or amended accounting principle de6 scribed under paragraph (1), and may not recognize 

7 such new or amended accounting principle, unless 

8 the Commission or its designee determines that the 

9 benefits to investors of such new or amended ac10 counting principle significantly outweigh its costs.’’. 

11 SEC. 6. COMMUNITY BANK EXEMPTION FROM ANNUAL 

12 MANAGEMENT ASSESSMENT OF INTERNAL 

13 CONTROLS REQUIREMENT OF THE SAR14 BANES-OXLEY ACT OF 2002. 

15 Section 404 of the Sarbanes-Oxley Act of 2002 (15 

16 U.S.C. 7262) is amended by adding the following new sub17 section: 

18 ‘‘(d) COMMUNITY BANK EXEMPTION.— 

19 ‘‘(1) IN GENERAL.—This section shall not apply 

20 in any year to any insured depository institution 

21 which, as of the close of the preceding year, had 

22 total assets, as determined on a consolidated basis, 

23 of $10,000,000,000 or less. 

24 ‘‘(2) ADJUSTMENT OF AMOUNT.—The Commis25 sion shall annually adjust the dollar amount in paraVerDate Mar 15 2010 02:58 May 01, 2013 Jkt 029200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H1750.IH H1750

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1 graph (1) by an amount equal to the percentage in2 crease, for the most recent year, in total assets held 

3 by all depository institutions, as reported by the 

4 Federal Deposit Insurance Corporation.’’. 

5 SEC. 7. CERTAIN LOANS INCLUDED AS QUALIFIED MORT6 GAGES. 

7 Section 129C(b)(2) of the Truth in Lending Act (15 

8 U.S.C. 1639c(b)(2)) is amended— 

9 (1) in subparagraph (A)— 

10 (A) in clause (viii), by striking ‘‘and’’ at 

11 the end; 

12 (B) in clause (ix), by striking the period at 

13 the end and inserting ‘‘; and’’; and 

14 (C) by adding at the end the following: 

15 ‘‘(x) that is originated and retained in 

16 portfolio for a period of at least 3 years by 

17 a creditor having less than 

18 $10,000,000,000 in total assets.’’; and 

19 (2) in subparagraph (E)— 

20 (A) by striking ‘‘The Board may, by regu21 lation’’ and inserting ‘‘The Bureau shall, by 

22 regulation’’; and 

23 (B) by amending clause (iv) to read as fol24 lows: 


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1 ‘‘(iv) that is extended by a creditor 

2 that— 

3 ‘‘(I) originates and retains the 

4 balloon loans in portfolio for a period 

5 of at least 3 years; and 

6 ‘‘(II) together with all affiliates, 

7 has total assets of $10,000,000,000 or 

8 less.’’. 

9 SEC. 8. INCREASE IN SMALL SERVICER EXEMPTION. 

10 Section 6 of the Real Estate Settlement Procedures 

11 Act of 1974 (12 U.S.C. 2605) is amended by adding at 

12 the end the following: 

13 ‘‘(n) SMALL SERVICER EXEMPTION.—The Bureau 

14 shall, by regulation, provide exemptions to, or adjustments 

15 for, the provisions of this section for servicers that service 

16 20,000 or fewer mortgage loans, in order to reduce regu17 latory burdens while appropriately balancing consumer 

18 protections.’’. 

19 SEC. 9. APPRAISER QUALIFICATION THRESHOLD. 

20 Section 1112(b) of the Financial Institutions Reform, 

21 Recovery, and Enforcement Act of 1989 (12 U.S.C. 

22 3341(b)) is amended— 

23 (1) by striking ‘‘may establish a threshold level 

24 at or’’ and inserting ‘‘shall establish a threshold level 

25 of $250,000,’’; and 


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1 (2) by striking ‘‘transactions, if’’ and inserting 

2 ‘‘transactions. Each Federal financial institutions 

3 regulatory agency and the Resolution Trust Cor4 poration may establish a higher threshold than 

5 $250,000, if’’. 

6 SEC. 10. COORDINATION AMONG FINANCIAL INSTITUTIONS. 

7 Chapter 53 of title 31, United States Code, is amend8 ed— 

9 (1) by inserting after section 5332 the following 

10 new section: 

11 ‘‘§ 5333. Coordination among financial institutions 

12 ‘‘(a) IN GENERAL.—In the case of an entry received 

13 via an automated clearing house, no receiving depository 

14 financial institution shall be required to verify that the 

15 entry is not a prohibited transaction, if the originating de16 pository financial institution has warranted, pursuant to 

17 the automated clearing house rules governing such entry 

18 or otherwise, that the originating depository financial in19 stitution has complied with the sanctions programs admin20 istered by the Office of Foreign Assets Control in connec21 tion with such entry. 

22 ‘‘(b) DEFINITIONS.—For purposes of this section: 

23 ‘‘(1) AUTOMATED CLEARING HOUSE.—The 

24 term ‘automated clearing house’ means a funds 

25 transfer system governed by rules which provide for 


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1 the interbank clearing of electronic entries for par2 ticipating depository financial institutions. 

3 ‘‘(2) DEPOSITORY FINANCIAL INSTITUTION.— 

4 The term ‘depository financial institution’ means— 

5 ‘‘(A) any insured depository institution, as 

6 such term is defined under section 3 of the 

7 Federal Deposit Insurance Act (12 U.S.C. 

8 1813); 

9 ‘‘(B) any depository institution which is el10 igible to apply to become an insured depository 

11 institution under section 5 of the Federal De12 posit Insurance Act (12 U.S.C. 1815); 

13 ‘‘(C) any insured credit union, as defined 

14 in section 101 of the Federal Credit Union Act 

15 (12 U.S.C. 1752); and 

16 ‘‘(D) any credit union which is eligible to 

17 apply to become an insured credit union pursu18 ant to section 201 of the Federal Credit Union 

19 Act (12 U.S.C. 1781). 

20 ‘‘(3) ENTRY.—The term ‘entry’ means an order 

21 to request for the transfer of funds through an auto22 mated clearing house. 

23 ‘‘(4) ORIGINATING DEPOSITORY FINANCIAL IN24 STITUTION.—The term ‘originating depository finan25 cial institution’ means a depository financial instituVerDate Mar 15 2010 02:58 May 01, 2013 Jkt 029200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H1750.IH H1750

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1 tion that transmits entries via an automated clearing 

2 house for transmittal to a receiving depository finan3 cial institution. 

4 ‘‘(5) PROHIBITED TRANSACTION.—The term 

5 ‘prohibited transaction’ means a funds transfer 

6 originated on behalf of a person to or from whom 

7 funds transfers are restricted by a sanctions pro8 gram administered by the Office of Foreign Assets 

9 Control, including persons appearing on the list of 

10 specially designated nationals and blocked persons 

11 maintained by the Office of Foreign Assets Control. 

12 ‘‘(6) RECEIVING DEPOSITORY FINANCIAL INSTI13 TUTION.—The term ‘receiving depository financial 

14 institution’ means a depository financial institution 

15 that receives entries via an automated clearing house 

16 from an originating depository financial institution 

17 for debit or credit to the accounts of its customers.’’; 

18 and 

19 (2) in the table of contents for such chapter by 

20 inserting after the item relating to section 5332 the 

21 following new item: 

‘‘5333. Coordination among financial institutions.’’. 

Æ 


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