I

103D CONGRESS

1ST SESSION H. R. 59

To increase the amount of credit available to fuel economic growth by reducing the regulatory burden imposed upon depository institutions, and

for other purposes.

IN THE HOUSE OF REPRESENTATIVES

JANUARY 5, 1993

Mr. BEREUTER introduced the following bill; which was referred to the

Committee on Banking, Finance and Urban Affairs

A BILL

To increase the amount of credit available to fuel economic

growth by reducing the regulatory burden imposed upon

depository institutions, 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.

4 This Act may be cited as the ‘‘Depository Institution

5 Burden Relief Act of 1993’’.

6 SEC. 2. PURPOSES.

7 The purposes of this Act are as follows:

8 (1) To increase regulatory efficiency by elimi9 nating duplicative and needless regulatory require-
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1 ments that are unrelated to assuring the safety and

2 soundness of financial institutions.

3 (2) To reduce regulatory compliance burdens on

4 capital-efficient depository institutions, especially

5 small, community-oriented depository institutions,

6 which come in the form of costly software purchases

7 and hiring additional staff solely for regulatory com8 pliance duties.

9 (3) To decrease statutory prescription of regu10 lations of financial institutions.

11 (4) To increase the bank regulator’s supervisory

12 discretion, and thus, increase some flexibility in its

13 examinations of financial institutions.

14 (5) To encourage bank regulators to return to

15 a practice of reviewing its regulations and discarding

16 stale ones.

17 (6) To ensure that bank attention is focused on

18 complying with regulations that are designed to en19 sure safe and sound operation of the institutions.

20 (7) To reduce regulatory burdens for banks, the

21 cost of which is eventually borne by the public—ei22 ther by higher cost of services or in terms of less

23 service.

24 (8) To ensure that Federal banking agency re25 sources are targeted at those financial institutions
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1 operating in areas where banking services are a

2 problem or in dispute.

3 (9) To reduce the cost of regulation of the

4 banking industry to the Federal Government.

5 TITLE I—SUPERVISORY

6 REFORMS

7 SEC. 101. COORDINATION OF FEDERAL AND STATE EXAMI8 NATIONS TO REDUCE DUPLICATIVE EF9 FORTS.

10 (a) RECIPROCITY FOR STATE EXAMINATIONS.—Sec11 tion 10(d)(3) of the Federal Deposit Insurance Act (12

12 U.S.C. 1820(d)(3)) (as amended by section 111 of the

13 Federal Deposit Insurance Corporation Improvement Act

14 of 1991) is amended to read as follows:

15 ‘‘(3) STATE EXAMINATIONS ACCEPTABLE.—The

16 examination requirement established under para17 graph (1) may be satisfied by an examination of the

18 insured depository institution conducted by the ap19 propriate State bank supervisor during the 12-

20 month period if the appropriate Federal banking

21 agency determines that the State examination car22 ries out the purposes of this subsection.’’.

23 (b) STATE COORDINATION WITH FEDERAL EXAMI24 NATIONS.—The appropriate Federal banking agencies and
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1 appropriate State bank supervisors shall, to the greatest

2 extent practicable—

3 (1) coordinate examinations of insured deposi4 tory institutions; and

5 (2) obtain and use copies of reports of examina6 tions of insured depository institutions made by any

7 other appropriate Federal banking agency or appro8 priate State bank supervisor.

9 (c) TECHNICAL AND CONFORMING AMENDMENT.—

10 Section 3(r) of the Federal Deposit Insurance Act (12

11 U.S.C. 1813(r)) is amended to read as follows:

12 ‘‘(r) APPROPRIATE STATE BANK SUPERVISOR.—The

13 term ‘appropriate State bank supervisor’ means any offi14 cer, agency, or other entity of any State which has primary

15 regulatory authority over State banks or State savings as16 sociations in such State.’’.

17 SEC. 102. COORDINATION OF FEDERAL AND STATE RE18 PORTING REQUIREMENTS TO REDUCE DU19 PLICATIVE EFFORTS.

20 (a) STATE ACCESS TO FEDERAL AGENCY RE21 PORTS.—The 1st sentence of section 7(a)(2)(A) of the

22 Federal Deposit Insurance Act (12 U.S.C. 1817(a)(2)(A))

23 is amended by inserting ‘‘and any appropriate State bank

24 supervisor’’ after ‘‘The Corporation’’.
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1 (b) STATE COORDINATION WITH FEDERAL REPORT2 ING REQUIREMENTS.—The Federal banking agencies and

3 State bank supervisors shall, to the greatest extent prac4 ticable—

5 (1) coordinate the number, types, and frequency

6 of reports (as defined in section 44(b)(4) of the Fed7 eral Deposit Insurance Act) required to be submitted

8 by insured depository institutions and the type and

9 amount of information required to be included in

10 such reports; and

11 (2) obtain and use copies of reports of condition

12 and other reports submitted by such institutions to

13 any such agency or supervisor.

14 SEC. 103. CONSOLIDATED REPORTS IN THE CASE OF CAP15 ITAL-EFFICIENT DEPOSITORY INSTITUTION

16 SUBSIDIARIES OF DEPOSITORY INSTITUTION

17 HOLDING COMPANIES.

18 (a) IN GENERAL.—The Federal Deposit Insurance

19 Act (12 U.S.C. 1811 et seq.) is amended by adding at

20 the end the following new section:

21 ‘‘SEC. 44. REPORT AND REGULATORY RELIEF PROVISIONS.

22 ‘‘(a) CONSOLIDATED REPORTS ALLOWED.—Notwith23 standing any provision of this Act, title LXII of the Re24 vised Statutes, the Federal Reserve Act, the Home Own25 ers’ Loan Act, or the Bank Holding Company Act of 1956
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1 or any regulation prescribed under any such law, any pro2 vision of any such law which requires the submission of

3 any report to any appropriate Federal banking agency by

4 any capital-efficient insured depository institution which

5 is a subsidiary of a depository institution holding company

6 may be satisfied with respect to such depository institution

7 by a consolidated report by the holding company which

8 consolidates the information required to meet the require9 ments of such provision with respect to each capital-effi10 cient insured depository institution subsidiary of the hold11 ing company.’’.

12 (b) CAPITAL-EFFICIENT INSURED DEPOSITORY IN13 STITUTION DEFINED.—Section 3(c) of the Federal De14 posit Insurance Act (12 U.S.C. 1813(c)) is amended by

15 adding at the end the following new paragraph:

16 ‘‘(6) CAPITAL-EFFICIENT INSURED DEPOSITORY

17 INSTITUTION.—The term ‘capital-efficient insured

18 depository institution’ means an insured depository

19 institution which—

20 ‘‘(A) is adequately capitalized (as defined

21 in section 38); and

22 ‘‘(B) has a CAMEL composite rating of 1

23 or 2 under the Uniform Financial Institution

24 Rating System or an equivalent rating under a

25 comparable system.’’.
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1 SEC. 104. APPLICABILITY OF CERTAIN REQUIREMENTS RE2 LATING TO EARLY IDENTIFICATION OF NEED3 ED IMPROVEMENTS.

4 Section 36 of the Federal Deposit Insurance Act (12

5 U.S.C. 1831m) is amended by adding at the end the fol6 lowing new subsection:

7 ‘‘(k) APPLICABILITY TO CAPITAL-EFFICIENT IN8 SURED DEPOSITORY INSTITUTIONS.—This section shall

9 not apply with respect to any capital-efficient insured de10 pository institution.’’.

11 SEC. 105. REDUCTION IN SUBMISSION OF DUPLICATIVE IN12 FORMATION.

13 Section 44 of the Federal Deposit Insurance Act (as

14 added by section 5 of this Act) is amended by inserting

15 after subsection (a) the following new subsection:

16 ‘‘(b) REDUCTION IN SUBMISSION OF DUPLICATIVE

17 INFORMATION.—

18 ‘‘(1) DESCRIBING INFORMATION PREVIOUSLY

19 SUBMITTED.—In the case of any information

20 which—

21 ‘‘(A) is required to be included in a report

22 submitted by any insured depository institution

23 to an appropriate Federal banking agency pur24 suant to any provision of this Act, title LXII of

25 the Revised Statutes, the Federal Reserve Act,

26 the Home Owners’ Loan Act, or the Bank
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1 Holding Company Act of 1956, or any regula2 tion prescribed under any such law; and

3 ‘‘(B) was included in a report submitted by

4 such institution (before the date of the submis5 sion of the report referred to in subparagraph

6 (A)) to such agency or any other Federal bank7 ing agency,

8 the requirement to include such information in the

9 report referred to in subparagraph (A) shall be

10 deemed to be met if the report contains an explicit

11 reference to the report in which such information

12 was previously included.

13 ‘‘(2) COORDINATION OF INFORMATION RE14 QUIREMENTS.—

15 ‘‘(A) SUBMISSION OF DUPLICATIVE INFOR16 MATION PROHIBITED.—Notwithstanding any

17 provision of this Act, title LXII of the Revised

18 Statutes, the Federal Reserve Act, the Home

19 Owners’ Loan Act, or the Bank Holding Com20 pany Act of 1956, or any regulation prescribed

21 under any such law, a Federal banking agency

22 may not require the submission by any insured

23 depository institution of information which is

24 available from any other Federal banking

25 agency.
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1 ‘‘(B) CONSULTATION REQUIRED.—The ap2 propriate Federal banking agencies shall con3 sult with each other through the Financial In4 stitutions Examination Council on a regular

5 basis to—

6 ‘‘(i) coordinate the manner in which

7 information is collected from insured de8 pository institutions; and

9 ‘‘(ii) ensure compliance with subpara10 graph (A) and section 1012 of the Federal

11 Financial Institutions Examination Council

12 Act of 1978.

13 ‘‘(3) PROHIBITION ON REQUIRING THE SUBMIS14 SION OF MORE THAN 1 COPY OF ANY REPORT.—A

15 Federal banking agency may not require the submis16 sion of more than 1 copy of any report, including

17 any exhibit or other material required to be filed

18 with any report, submitted by any insured depository

19 institution to such agency.

20 ‘‘(4) REPORTS DEFINED.—For purposes of this

21 section, the term ‘report’ includes any application,

22 notice, or other document.’’.
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1 SEC. 106. PROHIBITION ON DATA COLLECTION WHICH IS

2 UNRELATED TO SAFETY AND SOUNDNESS.

3 (a) LIMITATION ON DATA COLLECTION AUTHOR4 ITY.—Section 44 of the Federal Deposit Insurance Act (as

5 added by section 5 of this Act) is amended by inserting

6 after subsection (b) (as added by section 7 of this Act)

7 the following new subsection:

8 ‘‘(c) PROHIBITION ON DATA COLLECTION WHICH IS

9 NOT RELATED TO SAFETY AND SOUNDNESS.—Notwith10 standing any other provision of this Act other than section

11 8, an appropriate Federal banking agency may not require

12 an insured depository institution to submit any informa13 tion which is not related to—

14 ‘‘(1) the safety or soundness of the institution;

15 ‘‘(2) the insured deposits of the institution; or

16 ‘‘(3) reserve requirements applicable with re17 spect to the institution,

18 in connection with any report, application, notice or other

19 document otherwise authorized or required under this

20 Act.’’.

21 (b) REPEAL OF OTHER REPORTING BURDENS.—

22 (1) Section 122 of the Federal Deposit Insur23 ance Corporation Improvement Act of 1991 is re24 pealed.
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1 (2) Section 477 of the Federal Deposit Insur2 ance Corporation Improvement Act of 1991 is

3 repealed.

4 SEC. 107. REDUCTION OF CALL REPORT BURDENS.

5 (a) ‘‘SHORT FORM’’ CALL REPORT FOR CAPITAL-EF6 FICIENT DEPOSITORY INSTITUTIONS.—Section 44 of the

7 Federal Deposit Insurance Act (as added by section 5 of

8 this Act) is amended by inserting after subsection (c) (as

9 added by section 8 of this Act) the following new sub10 section:

11 ‘‘(d) ‘SHORT FORM’ CALL REPORT.—

12 ‘‘(1) IN GENERAL.—Notwithstanding any provi13 sion of this Act, title LXII of the Revised Statutes,

14 the Federal Reserve Act, or the Home Owners’ Loan

15 Act, or any regulation prescribed pursuant to any

16 such provision, no capital-efficient insured depository

17 institution shall be required by any appropriate Fed18 eral banking agency to include any information in

19 any report of condition submitted by such institution

20 other than the following information:

21 ‘‘(A) Income statement.

22 ‘‘(B) Balance sheet, including risk-based

23 capital.

24 ‘‘(C) Schedule of off-balance sheet items.
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1 ‘‘(2) NONAPPLICABILITY IN CASE OF FALSE OR

2 MISLEADING REPORTS.—This subsection shall not

3 apply to any insured depository institution which—

4 ‘‘(A) fails to make any report of condition

5 described in paragraph (1) within the period of

6 time required, or submits a false or misleading

7 report of condition during the 10-year period

8 beginning on the date the appropriate Federal

9 banking agency determines that such action or

10 failure to act has occurred, unless the institu11 tion demonstrates to the satisfaction of such

12 agency—

13 ‘‘(i) that—

14 ‘‘(I) the institution maintains

15 procedures reasonably adapted to

16 avoid any inadvertent error; and

17 ‘‘(II) the failure to file the report

18 within the period of time required or

19 the submission of a false or mislead20 ing report was unintentional and a re21 sult of such inadvertent error; or

22 ‘‘(ii) in the case of a report submitted

23 after the period of time required, that—

24 ‘‘(I) the report was minimally

25 late; and
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1 ‘‘(II) the late submission by the

2 institution was inadvertent; or

3 ‘‘(B) is required by order to file a report

4 of condition.’’.

5 (b) REPEAL OF PUBLICATION REQUIREMENTS.—

6 (1) The 5th sentence of section 5211(a) of the

7 Revised Statutes (12 U.S.C. 161(a)) is amended by

8 striking ‘‘; and the statement of resources and liabil9 ities in the same form in which it is made to the

10 Comptroller shall be published in a newspaper’’ and

11 all that follows through the period and inserting a

12 period.

13 (2) Section 5211(c) of the Revised Statutes (12

14 U.S.C. 161(c)) is amended by striking the 5th sen15 tence.

16 (3) Section 7(a)(1) of the Federal Deposit In17 surance Act (12 U.S.C. 1817(a)(1)) is amended by

18 striking the 4th sentence.

19 (4) The last sentence of the 6th undesignated

20 paragraph of section 9 of the Federal Reserve Act

21 (12 U.S.C. 324) is amended by striking ‘‘and shall

22 be published’’ and all that follows through the end

23 of the sentence and inserting a period.

24 (c) REDUCTION OF OTHER CALL REPORT BUR25 DENS.—
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1 (1) IN GENERAL.—Before the end of the 120-

2 day period beginning on the date of enactment of

3 this Act, each appropriate Federal banking agency

4 shall review the regulatory burden and costs in5 curred by insured depository institutions in connec6 tion with their preparation of reports of condition.

7 (2) FACTORS TO BE CONSIDERED.—In conduct8 ing the review required under paragraph (1), each

9 agency shall consider all relevant factors that the

10 agency determines to be necessary to correctly deter11 mine the extent of the burden and costs, including—

12 (A) the actual dollar cost to insured depos13 itory institutions in preparing such reports;

14 (B) the time and resources expended to

15 meet regulatory directives;

16 (C) the frequency with which the agency

17 has modified the types of information required

18 to be reported in such reports and the costs and

19 burdens associated with complying with such

20 modifications;

21 (D) the types of report of condition infor22 mation required of other types of insured depos23 itory institutions by such institutions’ appro24 priate Federal banking agencies; and
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1 (E) the extent to which such costs and

2 burdens impact upon the availability of credit.

3 (3) CORRECTIVE MEASURES.—

4 (A) IN GENERAL.—After conducting the

5 review required under paragraph (1), each ap6 propriate Federal banking agency shall, in con7 sultation with the other appropriate Federal

8 banking agencies, revise the agency’s report of

9 condition requirements to eliminate any unnec10 essary burdens and costs.

11 (B) CONSIDERATION OF BURDENS AND

12 COSTS.—Before making any subsequent modi13 fication in report of condition requirements,

14 each appropriate Federal banking agency shall

15 consider the extent to which such modifications

16 impose unnecessary regulatory burdens and

17 costs upon insured depository institutions.

18 (4) AMENDMENT RELATING TO NATIONAL

19 BANKS.—Section 5211(a) of the Revised Statutes

20 (12 U.S.C. 161(a)) is amended by adding at the end

21 the following sentence: ‘‘Any change in the form of

22 report of condition made under this subsection shall

23 be effective only once in a particular calendar year,

24 and only after at least 6 months from the date that

25 notice of the change is published in the Federal Reg-
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1 ister, except that such a change may be effective on

2 a subsequent date or after less notice if the Comp3 troller makes a specific finding that an additional

4 change in the form or a shorter advance-notice pe5 riod is necessary because of an emergency or change

6 in Federal law.’’.

7 (5) AMENDMENT RELATING TO STATE NON8 MEMBER INSURED BANKS.—Section 7(a) of the Fed9 eral Deposit Insurance Act (12 U.S.C. 1817(a) is

10 amended by adding at the end the following new

11 paragraph:

12 ‘‘(10) TRANSITION PERIOD FOR CHANGES IN

13 REPORT REQUIREMENTS.—Any change in the form

14 of reports of condition made under this subsection

15 shall be effective only once in a particular calendar

16 year, and only after at least 6 months from the date

17 that notice of the change is published in the Federal

18 Register, except that such a change may be effective

19 on a subsequent date or after less notice if the

20 Board of Directors makes a specific finding that an

21 additional change in the form or a shorter advance22 notice period is necessary because of an emergency

23 or change in Federal law.’’.

24 (6) AMENDMENT RELATING TO STATE MEMBER

25 BANKS.—The 6th undesignated paragraph of section
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1 9 of the Federal Reserve Act (12 U.S.C. 324) is

2 amended by adding at the end the following sen3 tence: ‘‘Any change in the form of report of condi4 tion made under this subsection shall be effective

5 only once in a particular calendar year, and only

6 after at least 6 months from the date that notice of

7 the change is published in the Federal Register, ex8 cept that such a change may be effective on a subse9 quent date or after less notice if the Board of Gov10 ernors of the Federal Reserve System makes a spe11 cific finding that an additional change in the form

12 or a shorter advance-notice period is necessary be13 cause of an emergency or change in Federal law.’’.

14 (7) AMENDMENT RELATING TO SAVINGS ASSO15 CIATION.—Section 5(v) of the Home Owners’ Loan

16 Act (12 U.S.C. 1464(v)) is amended by adding at

17 the end the following new paragraph:

18 ‘‘(9) TRANSITION PERIOD FOR CHANGES IN RE19 PORT REQUIREMENTS.—Any change in the form of

20 reports of condition made under this subsection shall

21 be effective only once in a particular calendar year,

22 and only after at least 6 months from the date that

23 notice of the change is published in the Federal Reg24 ister, except that such a change may be effective on

25 a subsequent date or after less notice if the Director
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1 makes a specific finding that an additional change in

2 the form or a shorter advance-notice period is nec3 essary because of an emergency or change in Fed4 eral law.’’.

5 (8) AMENDMENT RELATING TO CREDIT

6 UNIONS.—Section 202(a)(1) of the Federal Credit

7 Union Act (12 U.S.C. 1782(a)(1)) is amended by

8 adding at the end the following sentence: ‘‘Any

9 change in the form of reports of condition made

10 under this subsection shall be effective only once in

11 a particular calendar year, and only after at least 6

12 months from the date that notice of the change is

13 published in the Federal Register, except that such

14 a change may be effective on a subsequent date or

15 after less notice if the Board makes a specific find16 ing that an additional change in the form or a short17 er advance-notice period is necessary because of an

18 emergency or change in Federal law.’’.

19 (9) DEFINITIONS.—For purposes of this sub20 section, the terms ‘‘insured depository institution’’

21 and ‘‘appropriate Federal banking agency’’ shall

22 have the same meanings as provided in section 3 of

23 the Federal Deposit Insurance Act.

24 (d) EFFECTIVE DATE.—The amendment made by

25 subsection (a) shall apply with respect to reports of condi-
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1 tions for periods beginning after the first September 30

2 which occurs not less than 6 months after the date of the

3 enactment of this Act.

4 SEC. 108. REGULATORY STANDARDS FOR CAPITAL-EFFI5 CIENT DEPOSITORY INSTITUTIONS.

6 Section 39 of the Federal Deposit Insurance Act (as

7 added by section 132 of the Federal Deposit Insurance

8 Corporation Improvement Act of 1991) is amended—

9 (1) by redesignating subsections (d), (e), (f),

10 and (g) as subsections (e), (f), (g), and (h), respec11 tively; and

12 (2) by inserting after subsection (c) the follow13 ing new subsection:

14 ‘‘(d) STANDARDS FOR CAPITAL-EFFICIENT DEPOSI15 TORY INSTITUTIONS.—Subsections (a), (b), and (c) shall

16 not apply with respect to any capital-efficient insured de17 pository institution.’’.

18 SEC. 109. AMENDMENT RELATING TO CERTAIN NOTICE RE19 QUIREMENTS.

20 Section 42 of the Federal Deposit Insurance Act (12

21 U.S.C. 1831s) is amended by adding at the end the follow22 ing new subsections:

23 ‘‘(d) APPLICABILITY TO ‘OUTSTANDING’ INSTITU24 TIONS.—This section shall not apply with respect to any

25 insured depository institution which received a rating of
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1 ‘outstanding record of meeting community credit needs’

2 in the most recent examination of such institution under

3 section 804 of the Community Reinvestment Act of 1977.

4 ‘‘(e) BRANCH DEFINED.—For purposes of this sec5 tion, the term ‘branch’ shall not include—

6 ‘‘(1) an automated teller machine;

7 ‘‘(2) a branch acquired through merger, consoli8 dation, purchase, assumption or other method that

9 is located in a local market area currently served by

10 another branch of the acquiring institution;

11 ‘‘(3) a branch that is closed and reopened in

12 another location within the same local market area

13 which would continue to provide banking services to

14 substantially all of the customers currently served by

15 the branch that is closed;

16 ‘‘(4) a branch that is closed in connection

17 with—

18 ‘‘(A) an emergency acquisition under—

19 ‘‘(i) section 11(n); or

20 ‘‘(ii) subsections (f) or (k) of section

21 13; or

22 ‘‘(B) any assistance provided by the Cor23 poration under section 13(c); and

24 ‘‘(5) any other branch that is closed and for

25 which exemption from the notice requirements of
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1 this section would not produce a result inconsistent

2 with the purposes of this section, as determined by

3 the appropriate Federal banking agency by regula4 tion.’’.

5 SEC. 110. REGULATORY BURDEN REVIEW.

6 (a) IN GENERAL.—Before the end of each 4-year pe7 riod beginning on the date of the enactment of this Act,

8 each Federal banking agency, in consultation with individ9 uals representing insured depository institutions, consum10 ers, community groups, and other interested parties,

11 shall—

12 (1) review the regulations, policies and proce13 dures, and recordkeeping and documentation re14 quirements used to monitor and enforce compliance

15 with all laws under the jurisdiction of the Federal

16 banking agencies;

17 (2) determine whether such regulations, poli18 cies, procedures, and requirements impose unneces19 sary burdens on insured depository institutions; and

20 (3) identify and prescribe any revisions of such

21 regulations, policies, procedures, and requirements

22 that could reduce unnecessary burdens on insured

23 depository institutions without in any respect—
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1 (A) diminishing either compliance with or

2 enforcement of consumer laws in any respect;

3 or

4 (B) endangering the safety and soundness

5 of insured depository institutions.

6 (b) REPORT.—At the end of each 4-year period be7 ginning on the date of the enactment of this Act, each

8 Federal banking agency shall submit to the Congress a

9 report describing the revisions identified under subsection

10 (a)(3).

11 (c) UNIFORM REGULATIONS.—In prescribing regula12 tions on any matter or issuing any interpretation of any

13 such regulation, each appropriate Federal banking agency

14 shall ensure, subject to any other applicable provision of

15 law, that the regulation, and any formal or informal inter16 pretation of such regulation, are uniform with the regula17 tions and interpretations of each other appropriate Fed18 eral banking agency regarding such matter.

19 (d) DEFINITIONS.—For purposes of this section—

20 (1) APPROPRIATE FEDERAL BANKING AGEN21 CY.—The term ‘‘appropriate Federal banking agen22 cy’’ has the meaning given to such term in section

23 3(q) of the Federal Deposit Insurance Act.

24 (2) INSURED DEPOSITORY INSTITUTION.—The

25 term ‘‘insured depository institution’’ has the mean-
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1 ing given to such term in section 3(c)(2) of the Fed2 eral Deposit Insurance Act.

3 SEC. 111. REPEAL OF INTERBANK LIABILITY PROVISIONS.

4 Section 23 of the Federal Reserve Act (12 U.S.C.

5 371b–2) is repealed.

6 SEC. 112. APPROVALS FOR CAPITAL-EFFICIENT STATE

7 BANKS.

8 Section 24(g) of the Federal Deposit Insurance Act

9 (12 U.S.C. 1831a(g)) is amended to read as follows:

10 ‘‘(g) DETERMINATIONS.—

11 ‘‘(1) IN GENERAL.—Except as provided in para12 graph (2), the Corporation shall make determina13 tions under this section by regulation or order.

14 ‘‘(2) EXPEDITED APPROVAL FOR CERTAIN

15 WELL-QUALIFIED INSURED STATE BANKS.—If—

16 ‘‘(A) any State bank which is a capital-effi17 cient insured depository institution files a notice

18 with the Corporation which states the bank’s

19 intention to engage, directly or through a sub20 sidiary, in any activity which is subject to sub21 section (a) or (d) and describes such activity;

22 and

23 ‘‘(B) before the end of the 45-day period

24 beginning on the date such notice is filed the

25 Corporation has not determined that such activ-
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1 ity poses a significant risk to the appropriate

2 deposit insurance fund,

3 the Corporation shall be deemed to have determined

4 as of the end of such period that such activity poses

5 no significant risk to the appropriate deposit insur6 ance fund.’’.

7 SEC. 113. COMMUNITY REINVESTMENT ACT AMENDMENTS.

8 (a) SELF-CERTIFICATION.—The Community Rein9 vestment Act of 1977 (12 U.S.C. 2901 et seq.) is amended

10 by adding after section 808 the following new sections:

11 ‘‘SEC. 809. SELF-CERTIFICATION.

12 ‘‘(a) SCOPE.—

13 ‘‘(1) IN GENERAL.—This section shall only

14 apply during a calendar year to a regulated financial

15 institution that—

16 ‘‘(A) has not been found to be in violation

17 of section 701(a) of the Equal Credit Oppor18 tunity Act, or any other substantive provision of

19 such Act, for the 5-year period preceding such

20 calendar year;

21 ‘‘(B) does not currently have a rating of

22 ‘needs to improve’ or ‘substantial noncompli23 ance’ from the appropriate Federal financial su24 pervisory agency under section 807(b); and
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1 ‘‘(C) had total assets, as of the preceding

2 December 31, less than $250,000,000.

3 ‘‘(2) INDEXING OF MINIMUM TOTAL ASSET RE4 QUIREMENT.—For purposes of paragraph (1), the

5 amount referred to in paragraph (1)(C) shall be ad6 justed annually after December 31, 1992, by the an7 nual percentage increase in the Consumer Price

8 Index for Urban Wage Earners and Clerical Work9 ers published by the Bureau of Labor Statistics.

10 ‘‘(b) MODIFIED REPORTING.—In lieu of being evalu11 ated under section 804 and receiving a written evaluation

12 under section 807 during the calendar year referred to in

13 subsection (a), a regulated financial institution described

14 in subsection (a) shall—

15 ‘‘(1) declare in writing to the appropriate Fed16 eral financial supervisory agency that—

17 ‘‘(A) the institution is a regulated financial

18 institution described in subsection (a); and

19 ‘‘(B) the institution is in compliance with

20 the requirements of this subsection;

21 ‘‘(2) display any notices that may be required

22 by the appropriate Federal financial supervisory

23 agency concerning the institution’s compliance with

24 the requirements of this Act; and
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1 ‘‘(3) make available for public inspection the

2 following information regarding the record of such

3 institution in meeting the credit needs of the institu4 tion’s entire community:

5 ‘‘(A) An identification of the community

6 served by the institution.

7 ‘‘(B) A list of the types of credit offered by

8 the institution.

9 ‘‘(C) Any public comments received within

10 the previous 2 years regarding the institution’s

11 service of the entire community’s credit needs.

12 ‘‘(D) Copies of any declaration submitted

13 under paragraph (1).

14 ‘‘(c) PENALTIES.—If the appropriate Federal finan15 cial supervisory agency finds that a regulated financial in16 stitution has submitted intentionally false information to

17 the appropriate Federal financial supervisory agency or

18 otherwise has willfully violated the requirements of sub19 section (b), such institution—

20 ‘‘(1) shall, notwithstanding this section, be sub21 ject to the requirements of section 804 for a period

22 of not more than 10 years; and

23 ‘‘(2) shall be subject to a fine of not more than

24 $10,000.
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1 ‘‘(d) COMMUNITY CHALLENGE.—The appropriate

2 Federal financial supervisory agency shall investigate any

3 allegation filed against a regulated financial institution

4 subject to this section that relates to whether such institu5 tion is helping to meet the credit needs of the institution’s

6 entire community, consistent with the safe and sound op7 eration of such institution.

8 ‘‘SEC. 810. SAFE HARBOR.

9 ‘‘Notwithstanding section 804(2), an application for

10 a deposit facility by a regulated financial institution shall

11 not be denied on the basis of such institution’s compliance

12 with this Act if such institution—

13 ‘‘(1) received a rating ‘Outstanding record of

14 meeting community credit needs’ or ‘Satisfactory

15 record of meeting community credit needs’ in the in16 stitution’s last evaluation under section 804; or

17 ‘‘(2) maintains continued compliance with sec18 tion 809.

19 ‘‘SEC. 811. STATE EXAMINATIONS.

20 ‘‘The appropriate Federal financial supervisory agen21 cy may accept examinations conducted by State super22 visory agencies pursuant to comparable State community

23 reinvestment laws in order to satisfy the requirements of

24 this Act.
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1 ‘‘SEC. 812. EXPEDITED EXAMINATION PROCEDURES.

2 ‘‘(a) IN GENERAL.—In connection with an examina3 tion of a regulated financial institution, the appropriate

4 Federal financial supervisory agency shall establish a 2-

5 tiered approach to evaluating a regulated financial institu6 tion pursuant to section 804.

7 ‘‘(b) CONDITION FOR COMPREHENSIVE EXAMINA8 TION.—A comprehensive and in-depth examination of per9 formance pursuant to section 804 shall only be conducted

10 if the appropriate Federal financial supervisory agency is

11 not satisfied that credit is being extended throughout the

12 community in a nondiscriminatory manner.’’.

13 (b) DUPLICATIVE INFORMATION COLLECTION.—Sec14 tion 804 of the Community Reinvestment Act of 1977 (12

15 U.S.C. 2903) is amended—

16 (1) by striking ‘‘and’’ at the end of paragraph

17 (1);

18 (2) by striking the period at the end of para19 graph (2) and inserting instead ‘‘; and’’; and

20 (3) by adding after paragraph (2) following new

21 paragraph:

22 ‘‘(3) not require a regulated financial insti23 tution to collect, prepare, file or maintain data

24 or information for purposes of assessing the in25 stitution’s record of helping to meet the credit

26 needs of its entire community, if such data or
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1 information is also required to be submitted

2 under the Home Mortgage Disclosure Act of

3 1975.’’.

4 (c) PUBLIC DISCLOSURE.—Section 807(b)(1)(B) of

5 the Community Reinvestment Act of 1977 (12 U.S.C.

6 2906(b)(1)(B)) is amended by striking ‘‘and data’’.

7 SEC. 114. CLARIFICATION OF DEFINITION.

8 Section 803(b) of the Community Reinvestment Act

9 of 1977 (12 U.S.C. 2902(b)) in the 2d paragraph which

10 is designated as paragraph (2) (defining regulated finan11 cial institution) by inserting ‘‘and does not include any

12 bank described in section 2(c)(2)(F) of the Bank Holding

13 Company Act of 1956’’ before the semicolon.

14 SEC. 115. ASSESSMENT BASE FOR DEPOSIT INSURANCE

15 PREMIUMS.

16 Section 7 of the Federal Deposit Insurance Act (12

17 U.S.C. 1817) is amended—

18 (1) in the 3d sentence of subsection (a)(3)—

19 (A) by striking ‘‘, and the reports on such

20 dates shall be the basis for the certified state21 ment to be filed in July pursuant to subsection

22 (c) of this section’’; and

23 (B) by striking ‘‘, and the reports on such

24 dates shall be the basis for the certified state-
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1 ment to be filed in January pursuant to sub2 section (c) of this section’’; and

3 (2) in subsection (b)(3) (as in effect before the

4 effective date of the amendment made by section

5 302(a) of Federal Deposit Insurance Corporation

6 Improvement Act of 1991) is amended by adding at

7 the end the following new sentence: ‘‘Notwithstand8 ing the preceding sentence, if the Corporation deter9 mines that the implementation of filing of certified

10 statements under subsection (c) would be facilitated,

11 the Corporation may adopt procedures under which

12 the average assessment base is calculated using the

13 assessment base on the last date in the immediately

14 preceding assessment period in which the institution

15 was required to make a report of condition in lieu

16 of the assessment base on the last date in the cur17 rent assessment period for which the institution was

18 required to make a report of condition.’’.

19 SEC. 116. ECONOMIC ANALYSIS OF CERTAIN BANKING REG20 ULATIONS.

21 (a) STATEMENT REQUIRED.—An appropriate Fed22 eral banking agency that certifies, pursuant to section

23 605(b) of title 5, United States Code, that a proposed or

24 final rule will not have a significant economic impact on

25 a substantial number of all small banks or savings associa-
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•HR 59 IH

1 tions, shall publish with such certification a detailed state2 ment that contains—

3 (1) an explanation of why the rule will not have

4 such an economic impact;

5 (2) an estimate of the number of small banks

6 or savings associations affected by the rule;

7 (3) an estimate of the costs and benefits to

8 each small bank or savings association attributable

9 to compliance with the rule; and

10 (4) in the case of a proposed rule, a request for

11 public comments on the economic impact of and the

12 number of small banks or savings associations af13 fected by the rule.

14 (b) FINAL RULES.—The preamble of each final rule

15 prescribed by an appropriate Federal banking agency

16 which has been preceded by a proposed rule shall—

17 (1) specifically respond to comments from the

18 public addressing the economic impact of, or the

19 number of small banks or savings associations af20 fected by, the proposed rule; and

21 (2) explain whether and how the final rule re22 sponds to those comments.

23 (c) DEFINITIONS.—For purposes of this section—

24 (1) APPROPRIATE FEDERAL BANKING AGEN25 CY.—The term ‘‘appropriate Federal banking agen-
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1 cy’’ has the meaning given to such term in section

2 3 of the Federal Deposit Insurance Act.

3 (2) SMALL BANK OR SAVINGS ASSOCIATION.—

4 The term ‘‘small bank or savings association’’ means

5 a bank or savings association (as defined in section

6 3 of the Federal Deposit Insurance Act) that has

7 total assets of not more than $250,000,000.

8 (3) SUBSTANTIAL NUMBER.—The term ‘‘sub9 stantial number’’ means more than 20 percent.

10 SEC. 117. OFFICE OF REGULATORY QUALITY.

11 The Federal Deposit Insurance Act (12 U.S.C. 1811

12 et seq.) is amended by inserting after section 44 (as added

13 by section 5 of this Act) the following new section:

14 ‘‘SEC. 45. OFFICE OF REGULATORY QUALITY.

15 ‘‘(a) ESTABLISHMENT REQUIRED.—Each appro16 priate Federal banking agency shall—

17 ‘‘(1) establish, within 180 days of the enact18 ment of this section, a separate Office of Regulatory

19 Quality to determine and monitor the accuracy, con20 sistency and quality of the examination activities of

21 such agency; and

22 ‘‘(2) establish the position of director of the Of23 fice of Regulatory Quality as the head of such office.

24 ‘‘(b) REGIONAL EMPLOYEES.—
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1 ‘‘(1) ASSIGNMENT.—The director of the Office

2 of Regulatory Quality of each appropriate Federal

3 banking agency shall assign 1 or more employees of

4 the Office of Regulatory Quality to each regional of5 fice of such agency.

6 ‘‘(2) NUMBER OF EMPLOYEES.—The number of

7 employees assigned to each regional office under

8 paragraph (1) shall be sufficient to adequately mon9 itor and maintain the quality of the examinations of

10 that regional office.

11 ‘‘(c) REPORTS OF COMPLAINTS OR QUESTIONS.—

12 Any insured depository institution and any officer, direc13 tor, employee or other representative of any insured depos14 itory institution may report to the Office of Regulatory

15 Quality of the appropriate Federal banking agency respon16 sible for the supervision of that insured depository institu17 tion any complaints or questions that such institution or

18 person may have regarding the examination activities of

19 the Federal banking agency or any employee of that

20 agency.

21 ‘‘(d) DEVELOPMENT OF UNIFORM STANDARDS OF

22 ACCURACY, CONSISTENCY, AND QUALITY.—

23 ‘‘(1) IN GENERAL.—The directors of the Offices

24 of Regulatory Quality of the appropriate Federal

25 banking agencies shall, on a coordinated basis, de-
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1 velop a uniform form which sets forth the standards

2 upon which the accuracy, consistency and quality of

3 the examination activities of each appropriate Fed4 eral banking agency shall be evaluated.

5 ‘‘(2) AVAILABILITY OF FORM.—The forms pre6 pared pursuant to paragraph (1) shall be made

7 available to each insured depository institution for

8 use in evaluating the appropriate Federal banking

9 agencies.

10 ‘‘(3) NOTICE OF AVAILABILITY OF FORM.—

11 Upon the completion of any examination involving

12 an insured depository institution, the appropriate

13 Federal banking agency shall notify such institution

14 of the availability of the forms prepared pursuant to

15 paragraph (1).

16 ‘‘(e) RESPONSE TO QUESTIONS AND COMPLAINTS

17 RELATING TO AGENCY OPERATIONS.—

18 ‘‘(1) INVESTIGATION AND RESPONSE.—An Of19 fice of Regulatory Quality shall promptly investigate

20 and respond to each complaint and question received

21 under subsection (c) with respect to the Federal

22 banking agency of which the Office is a part.

23 ‘‘(2) REFERRAL.—If an Office receives a com24 plaint or question regarding another Federal bank25 ing agency, or an employee of another Federal bank-
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•HR 59 IH

1 ing agency, it shall promptly refer such complaint or

2 question to the appropriate Office of Regulatory

3 Quality for that agency.

4 ‘‘(f) ACCESS TO AGENCY RECORDS.—The director of

5 an Office of Regulatory Quality, and any duly authorized

6 representative of that Office, shall have access to, and the

7 right to examine and copy, all records and recorded infor8 mation in any form within the possession or control of that

9 Federal banking agency or any employee or representative

10 of that agency which the director of the Office of Regu11 latory Quality deems relevant to the investigation under

12 this section.

13 ‘‘(g) ACCESS TO AGENCY INFORMATION.—The direc14 tor of an Office of Regulatory Quality shall have the same

15 right of access to information under this section with re16 spect to the appropriate Federal banking agency, and the

17 same right to enforce this access, as the Comptroller Gen18 eral pursuant to section 716 of title 31, United States

19 Code.

20 ‘‘(h) SUBPOENA AUTHORITY; CONFIDENTIALITY.—

21 ‘‘(1) SUBPOENA AUTHORITY.—The provisions

22 of section 716(c) of title 31, United States Code,

23 shall apply to the director of an Office of Regulatory

24 Quality, or any representative of that Office, with

25 respect to information which is necessary for the Of-
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1 fice to carry out the purposes of this section in the

2 same manner such section applies to the Comptroller

3 of the Currency.

4 ‘‘(2) CONFIDENTIALITY OF INFORMATION, COM5 PLAINT, AND COMPLAINANT.—An Office of Regu6 latory Quality, and the director and any representa7 tive of such Office, shall maintain the confidentiality

8 of—

9 ‘‘(A) any information contained in any

10 form described in subsection (d) which is sub11 mitted to the Office;

12 ‘‘(B) any complaint or question received

13 from any insured depository institution or any

14 representative of that institution; and

15 ‘‘(C) the identity of any insured depository

16 institution and any representative of an institu17 tion which submits any such form, complaint,

18 or question.

19 ‘‘(i) ANNUAL REPORT.—

20 ‘‘(1) REPORT REQUIRED.—The director of the

21 Office of Regulatory Quality for each appropriate

22 Federal banking agency shall submit an annual re23 port to the Congress which shall contain informa24 tion, with respect to the 12-month period for which

25 such report is made, regarding the accuracy, consist-
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•HR 59 IH

1 ency and quality of the examination activities of

2 such agency, the nature and number of complaints

3 and questions received regarding such agency and its

4 employees and the actions taken by that Office of

5 Regulatory Quality to improve the accuracy, consist6 ency and quality of the examination activities of the

7 agency.

8 ‘‘(2) RECOMMENDATIONS.—The director of

9 such Office shall also include within that report rec10 ommendations to simplify and streamline such exam11 ination activities.’’.

12 SEC. 118. PRIORITY OF SAFETY AND SOUNDNESS EXAMINA13 TIONS.

14 Section 10 of the Federal Deposit Insurance Act (12

15 U.S.C. 1820) is amended by adding at the end the follow16 ing new subsection:

17 ‘‘(g) PRIORITY OF SAFETY AND SOUNDNESS EXAMI18 NATIONS.—No insured depository institution shall be sub19 ject to any routine examination, other than an examina20 tion for purposes of determining the safety and soundness

21 of such institution, more frequently than the frequency at

22 which the institution is subject to full-scope, on-site exami23 nations required under subsection (d).’’.
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1 SEC. 119. BANK HOLDING COMPANY FORMATION THROUGH

2 REORGANIZATIONS.

3 (a) EXCEPTION TO APPROVAL REQUIREMENTS IN

4 CONNECTION WITH CERTAIN BANK REORGANIZA5 TIONS.—The 2d sentence of section 3(a) of the Bank

6 Holding Company Act of 1956 (12 U.S.C. 1842(a)) is

7 amended—

8 (1) by striking out ‘‘or (B)’’ and inserting in

9 lieu thereof ‘‘(B)’’; and

10 (2) by inserting before the period at the end the

11 following: ‘‘; or (C) the acquisition by a company of

12 control of a bank in connection with a reorganization

13 described in paragraph (1) of subsection (h) if the

14 requirements of such subsection are met’’.

15 (b) EXPEDITED PROCEDURES FOR CERTAIN REOR16 GANIZATIONS OF BANKS INTO HOLDING COMPANIES.—

17 Section 3 of the Bank Holding Company Act of 1956 (12

18 U.S.C. 1842) is amended by adding at the end thereof

19 the following new subsection:

20 ‘‘(h) EXPEDITED PROCEDURES FOR CERTAIN REOR21 GANIZATIONS OF BANKS INTO HOLDING COMPANIES.—

22 ‘‘(1) REORGANIZATION DESCRIBED.—For pur23 poses of subparagraph (C) of the second sentence of

24 subsection (a), a reorganization is described in this

25 paragraph if—
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1 ‘‘(A) the transaction represents the ex2 change, by the shareholders of the bank, of sub3 stantially all of the shares of a capital-efficient

4 bank for shares of a newly-formed bank holding

5 company;

6 ‘‘(B) each shareholder of the newly-formed

7 bank holding company holds, after such ex8 change, substantially the same proportionate in9 terest in the bank holding company as each

10 such shareholder held in the bank before such

11 exchange, other than any change in the share12 holders’ proportionate interest in such holding

13 company which resulted from the exercise of

14 dissenting shareholders’ rights under State or

15 Federal law; and

16 ‘‘(C) immediately following the reorganiza17 tion, the resulting bank holding company meets

18 the capital and other financial standards pre19 scribed by the Board by regulation for a bank

20 holding company.

21 ‘‘(2) EXPEDITED PROCEDURE.—The exception

22 provided by subparagraph (C) of the second sentence

23 of subsection (a) to the approval requirement of

24 such subsection shall apply with respect to a reorga-
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1 nization described in paragraph (1) of this sub2 section, if—

3 ‘‘(A) the bank referred to in paragraph

4 (1)(A) provides notice to the Board of such re5 organization at least 30 days before the date on

6 which such reorganization is scheduled to begin;

7 and

8 ‘‘(B) the Board has not—

9 ‘‘(i) issued an order before such date

10 disapproving such reorganization; or

11 ‘‘(ii) issued a notice before such date

12 that the provisions of this subsection are

13 not applicable to such reorganization by

14 reason of paragraph (3).

15 ‘‘(3) EXCEPTION IN CASE OF CERTAIN NON16 BANKING ACTIVITIES.—This subsection shall not

17 apply to any reorganization described in paragraph

18 (1) if, as a result of such reorganization, the bank

19 holding company would be engaging in any activity

20 other than banking or managing and controlling

21 banks.

22 ‘‘(4) CAPITAL-EFFICIENT BANK DEFINED.—The

23 term ‘capital-efficient bank’ means a bank which is

24 a capital-efficient insured depository institution (as
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1 defined in section 3(c)(6) of the Federal Deposit

2 Insurance Act).’’.

3 SEC. 120. EXPEDITED PROCEDURES FOR CERTAIN BANK

4 HOLDING COMPANIES TO SEEK APPROVAL

5 TO ENGAGE IN CERTAIN NONBANKING AC6 TIVITIES.

7 (a) IN GENERAL.—Section 4 of the Bank Holding

8 Company Act of 1956 (12 U.S.C. 1843) is amended by

9 adding at the end the following new subsection:

10 ‘‘(j) NOTICE PROCEDURES FOR NONBANKING AC11 TIVITIES.—

12 ‘‘(1) GENERAL NOTICE PROCEDURE.—

13 ‘‘(A) NOTICE REQUIREMENT.—In the case

14 of a bank holding company the insured deposi15 tory institution subsidiaries of which consist

16 only of capital-efficient depository institutions

17 (as defined in section 3(c)(6) of the Federal

18 Deposit Insurance Act), the bank holding com19 pany may not engage in any nonbanking activ20 ity or acquire or retain ownership or control of

21 the shares of a company engaged in activities

22 pursuant to subsection (c)(8) without providing

23 the Board with written notice of the proposed

24 transaction or activity at least 45 days before
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1 the transaction or activity is proposed to occur

2 or commence.

3 ‘‘(B) CONTENTS OF NOTICE.—

4 ‘‘(i) IN GENERAL.—The notice sub5 mitted to the Board shall contain such in6 formation as the Board shall prescribe by

7 regulation or by specific request in connec8 tion with a particular notice.

9 ‘‘(ii) LIMITATION ON INFORMATION.—

10 The Board may only require a notice

11 under this subsection to contain such in12 formation as may be relevant to the nature

13 and scope of the proposed activities or

14 transaction or to the Board’s evaluation of

15 the criteria contained in paragraph (2).

16 ‘‘(C) PROCEDURE FOR AGENCY ACTION.—

17 ‘‘(i) NOTICE OF DISAPPROVAL.—Any

18 notice filed under this subsection shall be

19 deemed to be approved by the Board un20 less, before the end of the 45-day period

21 beginning on the date the Board receives a

22 complete notice under subparagraph (A),

23 the Board issues an order disapproving the

24 transaction or activity and setting forth

25 the reasons for disapproval.
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1 ‘‘(ii) EXTENSION OF PERIOD.—The

2 Board may extend the 45-day period re3 ferred to in clause (i) for an additional 45

4 days.

5 ‘‘(D) APPROVAL BEFORE END OF PE6 RIOD.—

7 ‘‘(i) IN GENERAL.—Any transaction

8 or activity may commence before the expi9 ration of any period for disapproval estab10 lished under this paragraph if the Board

11 issues a written notice of approval.

12 ‘‘(ii) SHORTER PERIODS BY REGULA13 TION.—The Board may prescribe regula14 tions which provide for no notice under

15 this paragraph or for a shorter notice pe16 riod with respect to particular activities or

17 transactions.

18 ‘‘(E) EXTENSION OF PERIOD.—

19 ‘‘(i) ACTIVITIES NOT PREVIOUSLY AP20 PROVED.—

21 ‘‘(I) IN GENERAL.—In the case

22 of any notice to engage in, or to ac23 quire or retain ownership or control of

24 shares of any company engaged in,

25 any activity pursuant to subsection
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1 (c)(8) that has not been previously ap2 proved by order or regulation, the

3 Board may extend the notice period

4 under this subsection for an addi5 tional 90 days.

6 ‘‘(II) DETERMINATION OF PE7 RIOD IN CASE OF PUBLIC HEARING.—

8 If a public hearing is conducted in

9 connection with any proposal referred

10 to in subclause (I), the Board may ex11 tend the notice period under this sub12 section for a period not to exceed 90

13 days from the conclusion of the hear14 ing procedure.

15 ‘‘(ii) SECTION 3 APPLICATION.—In

16 the case of any notice filed in connection

17 with an application under section 3, the

18 Board may extend the notice period for the

19 time necessary to complete action on the

20 application under section 3.

21 ‘‘(2) GENERAL STANDARDS FOR REVIEW.—

22 ‘‘(A) CRITERIA.—In connection with a no23 tice under this subsection, the Board may con24 sider the following criteria:
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1 ‘‘(i) The managerial resources of the

2 companies involved.

3 ‘‘(ii) The adequacy of the companies

4 financial resources, including capital, giv5 ing consideration to the financial resources

6 and capital of others engaged in similar ac7 tivities.

8 ‘‘(iii) Any material adverse effect on

9 the safety and soundness or financial con10 dition of any insured depository institution

11 affiliate.

12 ‘‘(iv) Whether performance of the ac13 tivity by a bank holding company or a sub14 sidiary of such company can reasonably be

15 expected to produce benefits to the public,

16 such as greater convenience, increased

17 competition, or gains in efficiency, that

18 outweigh possible adverse effects, such as

19 undue concentration of resources, de20 creased or unfair competition, conflicts of

21 interest, or unsound banking practices.

22 ‘‘(B) REQUIREMENTS FOR DIS23 APPROVAL.—The Board shall disapprove any

24 proposed transaction pursuant to a notice filed

25 under this subsection if the Board determines
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1 that any insured depository institution subsidi2 ary of the bank holding company—

3 ‘‘(i) is engaging in any unsafe and un4 sound practice; or

5 ‘‘(ii) is in an unsafe and unsound

6 condition.’’.

7 (b) TECHNICAL AND CONFORMING AMENDMENTS.—

8 (1) Section 4(c)(8) of the Bank Holding Com9 pany Act of 1956 (12 U.S.C. 1843(c)(8)) is amend10 ed—

11 (A) in the 1st clause, by inserting ‘‘subject

12 to subsection (j),’’ before ‘‘shares of any com13 pany’’; and

14 (B) in the 1st complete sentence, by insert15 ing ‘‘, except in the case of a notice filed under

16 subsection (j),’’ after ‘‘Board shall consider’’.

17 (2) The penultimate sentence of section 4(c) of

18 the Bank Holding Company Act of 1956 (12 U.S.C.

19 1843(c)) is amended by striking ‘‘In the event’’ and

20 inserting ‘‘Except with respect to a notice filed

21 under subsection (j), in the event’’.
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1 SEC. 121. REDUCTION OF POST-APPROVAL PERIOD FOR

2 BANK HOLDING COMPANY ACQUISITIONS

3 AND BANK MERGERS.

4 (a) BANK HOLDING COMPANY ACQUISITIONS.—The

5 4th sentence of section 11(b)(1) of the Bank Holding

6 Company Act of 1956 (12 U.S.C. 1849(b)(1)) is amended

7 by inserting ‘‘or such shorter period as the Board may

8 prescribe with the concurrence of the Attorney General’’

9 before the period.

10 (b) DEPOSITORY INSTITUTION MERGERS.—The last

11 sentence of section 18(c)(6) of the Federal Deposit Insur12 ance Act (12 U.S.C. 1828(c)(6)) is amended by inserting

13 ‘‘or such shorter period as the agency may prescribe with

14 the concurrence of the Attorney General’’ before the

15 period.

16 SEC. 122. BANK SECRECY ACT AMENDMENTS.

17 (a) STAFF COMMENTARIES.—Title 31 of the United

18 States Code is amended to add the following new section

19 5327:

20 ‘‘SEC. 5327. STAFF COMMENTARIES.

21 ‘‘The Secretary of the Treasury shall review all regu22 lations promulgated under this title on an annual basis

23 and seek comment from the public pursuant to this review.

24 The Secretary shall publish all written rulings interpreting

25 this title, as well as a staff commentary to the regulations
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1 issued under this title. This commentary shall be issued

2 on an annual basis.’’.

3 (b) LOG REQUIREMENTS.—Section 5325(a)(1) of

4 title 31 of the United States Code is amended—

5 (1) by striking subparagraphs (A) and (B); and

6 (2) by inserting the following new paragraph

7 (1):

8 ‘‘(1) the individual has a transaction account

9 with such financial institution and the financial in10 stitution verifies that fact through a signature card

11 or other information maintained by such institution

12 in connection with the account of such individual.’’.

13 (c) EXEMPTION PROCESS.—Section 5318(a)(5) of

14 title 31 of the United States Code is amended—

15 (1) by inserting ‘‘or exception’’ after ‘‘an appro16 priate exemption’’; and

17 (2) by inserting ‘‘only after receiving comments

18 from the entities covered by this chapter. The Sec19 retary must take into account the effect that

20 changes to the exemption or exception process will

21 have on the cost and efficiency of the reporting proc22 ess.’’, after the words ‘‘under this subchapter’’.

23 (d) CUSTOMER FILINGS.—Section 5313(a) of title 31

24 of the United States Code is amended by striking ‘‘, the

25 institution and any other participant in the transaction
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1 the Secretary may prescribe shall file a report’’ and insert2 ing ‘‘the person who participates in the transaction shall

3 file a report’’.

4 (e) INFLATION ADJUSTMENTS ON CTR AMOUNTS.—

5 Section 5313(a) of title 31 of the United States Code is

6 amended by inserting after the second sentence the follow7 ing new sentence: ‘‘The Secretary must review the report8 ing requirements mentioned above by September 1 of each

9 calendar year to determine if the reporting amount pre10 scribed by the Secretary should be adjusted to account for

11 inflation, cost effectiveness of the requirement or the use12 fulness for law enforcement purposes. The Secretary must

13 submit a written report to the Congress each year disclos14 ing how the reporting threshold decision was reached. The

15 report must include an analysis of how the change will

16 affect domestic financial institutions.’’.

17 SEC. 123. AGGREGATE LENDING LIMITS FOR SMALL BANKS.

18 Section 22(h)(5) of the Federal Reserve Act (12

19 U.S.C. 375b(5)) is amended—

20 (1) by redesignating subparagraph (C) as sub21 paragraph (D); and

22 (2) by inserting after subparagraph (B) the fol23 lowing new subparagraph:

24 ‘‘(C) SMALL BANK EXCEPTION.—Notwith25 standing subparagraph (A), member banks with
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1 less than $100,000,000 in deposits may make

2 such extensions of credit in the aggregate to

3 persons specified in subparagraph (A) in an

4 amount not to exceed 2 times the bank’s

5 unimpaired capital and unimpaired surplus.’’;

6 and

7 (3) in subparagraph (D) (as redesignated), by

8 striking ‘‘less than $100,000,000’’ and inserting

9 ‘‘between $100,000,000 and $250,000,000’’.

10 SEC. 124. EFFECTIVE DATE.

11 Except as otherwise explicitly provided in any provi12 sion of this title, this title and amendments made by this

13 title shall take effect at the end of the 6-month period

14 beginning on the date of the enactment of this Act.

15 TITLE II—NONSUPERVISORY

16 REFORMS

17 Subtitle A—Expedited Funds Avail18 ability and Electronic Transfers

19 SEC. 201. AVAILABILITY SCHEDULES.

20 (a) TREASURY CHECKS.—Section 603(a)(2)(A) of

21 the Expedited Funds Availability Act (12 U.S.C.

22 4002(a)(2)(A)) is amended—

23 (1) by redesignating clauses (i) and (ii) as

24 clauses (ii) and (iii), respectively; and
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1 (2) by inserting before clause (ii) (as so redesig2 nated), the following new clause:

3 ‘‘(i) is deposited at a receiving depository

4 institution (other than by use of a propriety

5 ATM) which is staffed by individuals employed

6 by such institution;’’.

7 (b) PROPRIETARY ATM EXCEPTION.—Section

8 603(a)(2)(E)) of the Expedited Funds Availability Act (12

9 U.S.C. 4002(A)(2)(E)) is amended by inserting ‘‘(other

10 than by use of a proprietary ATM)’’ after ‘‘branch of a

11 depository institution’’.

12 (c) LOCAL CHECKS.—Section 603(b)(1) of the Expe13 dited Funds Availability Act (12 U.S.C. 4002(b)(1)) is

14 amended by striking ‘‘1 business day’’ and inserting ‘‘2

15 business days’’.

16 SEC. 202. DEFINITION OF A NEW ACCOUNT.

17 Section 604(a) of the Expedited Funds Availability

18 Act (12 U.S.C. 4003(a)) is amended by striking ‘‘30-day

19 period’’ and inserting ‘‘90-day period’’.

20 SEC. 203. AUTHORITY TO ESTABLISH RULES REGARDING

21 PAYMENT SYSTEM LOSSES AND LIABILITIES.

22 Section 611(f) of the Expedited Funds Availability

23 Act (12 U.S.C. 4010(f)) is amended in the first sentence

24 by inserting ‘‘, and other entities participating in the pay25 ments system, including States and political subdivisions
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1 of States on which checks are drawn,’’ after ‘‘depository

2 institutions’’.

3 Subtitle B—Amendments to the

4 Truth in Lending Act

5 SEC. 211. EXEMPTION FOR CERTAIN BORROWERS.

6 Section 104 of the Truth in Lending Act (15 U.S.C.

7 1603) is amended by adding at the end the following new

8 paragraph:

9 ‘‘(7) Credit transactions involving a consumer

10 who had individual income on excess of $200,000 in

11 each of the 2 most recent calendar years or who has

12 an individual net worth, or joint net worth with that

13 person’s spouse, at the time of the transaction, that

14 exceeds $1,000,000.’’.

15 SEC. 212. TRUTH IN LENDING ACT RIGHT OF RESCISSION.

16 Section 125(a) of the Truth in Lending Act (15

17 U.S.C. 1635(a)) is amended by adding at the end the fol18 lowing sentence: ‘‘The creditor shall be deemed to have

19 delivered to an obligor the information, rescission forms,

20 and statement of material disclosures required pursuant

21 to this section notwithstanding any errors included in such

22 information, forms or statement, unless any such error is

23 unintentional and does not materially understate the cost

24 of the transaction to the obligor.’’.
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1 Subtitle C—Homeownership

2 Amendments

3 SEC. 221. HOME MORTGAGE DISCLOSURE ACT EXEMPTION.

4 The Home Mortgage Disclosure Act of 1975 (12

5 U.S.C. 2801 et seq.) is amended—

6 (1) in section 304 (12 U.S.C. 2803), by striking

7 subsection (i); and

8 (2) in section 309 (12 U.S.C. 2808) by adding

9 at the end thereof ‘‘The dollar amount of total as10 sets referred to in this section shall be adjusted an11 nually on January 1 by the annual percentage

12 change in the Consumer Price Index reported for the

13 previous June 1.’’.

14 SEC. 222. HOMEOWNERSHIP DEBT COUNSELING NOTIFICA15 TION.

16 Section 106(c)(5) of the Housing and Urban Devel17 opment Act of 1968 (12 U.S.C. 1701x(c)(5)) is repealed.

18 SEC. 223. ELIMINATION OF DUPLICATIVE DATA COLLEC19 TION.

20 Effective 6 months after the date of enactment of this

21 Act, an appropriate Federal banking agency shall not re22 quire any insured depository institution (as defined in sec23 tion 3(q) of the Federal Deposit Insurance Act) to pre24 pare, file, or maintain data to further the purposes of, or

25 to fulfill the requirements of, the Fair Housing Act if the
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1 preparation, filing, or maintenance of such data is re2 quired under the Home Mortgage Disclosure Act of 1975.

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