I

103D CONGRESS

2D SESSION H. R. 3841

To amend the Bank Holding Company Act of 1956, the Revised Statutes

of the United States, and the Federal Deposit Insurance Act to provide

for interstate banking and branching.

IN THE HOUSE OF REPRESENTATIVES

FEBRUARY 10, 1994

Mr. NEAL of North Carolina (for himself, Mr. MCCOLLUM, Mr. LAFALCE, Mr.

VENTO, Mr. SCHUMER, Mr. FRANK of Massachusetts, Mr. KANJORSKI,

Mr. KENNEDY, Mr. FLAKE, Mr. MFUME, Mr. LAROCCO, Mr. ORTON, Mr.

KLEIN, Mrs. MALONEY, Ms. PRYCE of Ohio, Mr. LINDER, Mr. LAZIO,

Mr. BACHUS of Alabama, Mrs. ROUKEMA, Mr. MCCANDLESS, and Mr.

KING) introduced the following bill; which was referred to the Committee

on Banking, Finance and Urban Affairs

A BILL

To amend the Bank Holding Company Act of 1956, the

Revised Statutes of the United States, and the Federal

Deposit Insurance Act to provide for interstate banking

and branching.

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 AND TABLE OF CONTENTS.

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

5 ‘‘Interstate Banking Efficiency Act of 1994’’.

6 (b) TABLE OF CONTENTS.—
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Sec. 1. Short title and table of contents.

TITLE I—INTERSTATE BANKING AND BRANCHING

Sec. 101. Interstate banking.

Sec. 102. Interstate branching by national banks.

Sec. 103. Interstate branching by State banks.

Sec. 104. Branching by foreign banks.

Sec. 105. Interstate consolidations.

Sec. 106. Prohibition against deposit production offices.

Sec. 107. Restatement of existing law.

TITLE II—CRA EVALUATIONS

Sec. 201. State-by-State CRA evaluations of depository institutions with interstate branches.

1 TITLE I—INTERSTATE BANKING

2 AND BRANCHING

3 SEC. 101. INTERSTATE BANKING.

4 (a) INTERSTATE ACQUISITIONS.—Section 3(d) of the

5 Bank Holding Company Act of 1956 (12 U.S.C. 1842(d))

6 is amended to read as follows:

7 ‘‘(d) INTERSTATE ACQUISITIONS.—

8 ‘‘(1) APPROVALS AUTHORIZED.—

9 ‘‘(A) IN GENERAL.—Subject to paragraph

10 (2), the Board may approve an application

11 under this section by a bank holding company

12 to acquire, directly or indirectly, any voting

13 shares of, interest in, or all or substantially all

14 of the assets of any additional bank or any

15 bank holding company located in any State

16 other than the home State of the applicant

17 bank holding company.

18 ‘‘(B) CONCENTRATION LIMITS.—
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1 ‘‘(i) IN GENERAL.—The Board may

2 not approve an application under subpara3 graph (A) if—

4 ‘‘(I) the applicant (including all

5 insured depository institutions which

6 are affiliates of the applicant) con7 trols, or upon completion of the acqui8 sition would control, more than 10

9 percent of the total amount of insured

10 depository institution deposits in the

11 United States, as determined under

12 regulations of the Board; or

13 ‘‘(II) the applicant (including all

14 insured depository institutions which

15 are affiliates of the applicant) con16 trols, or upon completion of the acqui17 sition would control, 30 percent or

18 more of the total amount of insured

19 depository institution deposits in the

20 State in which the bank to be ac21 quired is located, as determined under

22 regulations of the Board.

23 ‘‘(ii) WAIVER BY STATE.—A State

24 may waive the application of clause (i)(II)

25 to an acquisition in such State.
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1 ‘‘(2) APPLICABILITY OF STATE LAW TO ACQUI2 SITIONS.—

3 ‘‘(A) INAPPLICABILITY OF CERTAIN STATE

4 LAWS TO ACQUISITIONS.—Subject to paragraph

5 (3), any acquisition described in paragraph

6 (1)(A) that has been approved under this sec7 tion may be consummated notwithstanding any

8 law of any State that would prohibit or other9 wise limit such acquisition on the basis of—

10 ‘‘(i) the location or size of the acquir11 ing company or any subsidiary of such

12 company;

13 ‘‘(ii) the number of bank subsidiaries

14 of such company; or

15 ‘‘(iii) any other factor that—

16 ‘‘(I) directly or indirectly, has the

17 effect of prohibiting or limiting the

18 acquisition of shares or control of a

19 bank or bank holding company located

20 in such State by an out-of-State bank

21 holding company; and

22 ‘‘(II) is not applied with similar

23 effect with respect to acquisitions of

24 banks or bank holding companies lo-
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1 cated in such State by bank holding

2 companies located in the State.

3 ‘‘(B) APPLICABILITY OF STATE LAW ON

4 THE FORM OF ACQUISITION.—

5 ‘‘(i) IN GENERAL.—Notwithstanding

6 any other provision of this subsection and

7 subject to clause (ii), any law of a host

8 State which—

9 ‘‘(I) is in existence on the date of

10 the enactment of the Interstate Bank11 ing Efficiency Act of 1994 or is en12 acted after such date; and

13 ‘‘(II) allows an out-of-State bank

14 or bank holding company to establish

15 a bank in the host State only by ac16 quiring an existing bank in the host

17 State,

18 shall apply with respect to the establish19 ment or acquisition of a bank in the host

20 State under this subsection.

21 ‘‘(ii) APPLICABILITY OF PROVISIONS

22 RELATING TO MINIMUM PERIOD OF EXIST23 ENCE OF ACQUIRED BANK.—In the case of

24 any State law referred to in clause (i)

25 which is enacted after the date of the en-
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1 actment of the Interstate Banking Effi2 ciency Act of 1994 and requires the bank

3 to be acquired to have been in existence

4 (as of the date of the transaction) for a pe5 riod of time greater than 5 years, such law

6 shall be applied under clause (i) by sub7 stituting ‘5-year period’ for such greater

8 period.

9 ‘‘(3) APPLICABILITY OF STATE LAW TO INTER10 STATE BANKING OPERATIONS.—

11 ‘‘(A) STATE TAXATION AUTHORITY NOT

12 AFFECTED.—No provision of this subsection

13 shall be construed as affecting the authority of

14 any State or political subdivision of any State

15 to apply and administer any tax or method of

16 taxation to any bank holding company or for17 eign bank, or any additional bank or bank hold18 ing company, when such tax or tax method is

19 otherwise permissible by or under the Constitu20 tion of the United States or other Federal law.

21 ‘‘(B) APPLICABILITY OF DEPOSIT CAPS

22 AND ANTITRUST LAWS.—No provision of this

23 subsection shall be construed as affecting—

24 ‘‘(i) the authority of any State to limit

25 the percentage of the total amount of in-
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1 sured depository institution deposits in the

2 State which may be held or controlled by

3 any bank to the extent the application of

4 such limitation does not discriminate

5 against out-of-State banks or bank holding

6 companies; or

7 ‘‘(ii) the applicability of any Federal

8 antitrust law or any State antitrust law

9 that does not discriminate against out-of10 State banks or bank holding companies.

11 ‘‘(4) DEFINITIONS.—For purposes of this sub12 section, the following definitions shall apply:

13 ‘‘(A) HOME STATE.—The term ‘home

14 State’ means, with respect to a bank holding

15 company, the State in which the total deposits

16 of all banking subsidiaries of such company

17 were the largest on the later of July 1, 1966,

18 or the date on which the company becomes a

19 bank holding company.

20 ‘‘(B) HOST STATE.—The term ‘host State’

21 means, with respect to a bank holding company

22 acquiring or establishing a bank in a State

23 other than such company’s home State, the

24 State in which the bank being acquired or es25 tablished is located.
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1 ‘‘(C) INSURED DEPOSITORY INSTITU2 TION.—The term ‘insured depository institu3 tion’ has the same meaning as in section 3 of

4 the Federal Deposit Insurance Act.

5 ‘‘(D) OUT-OF-STATE BANK HOLDING COM6 PANY.—The term ‘out-of State bank holding

7 company’ means, with respect to any State, a

8 bank holding company the home State of which

9 is another State.’’.

10 (b) EFFECTIVE DATE.—The amendment made by

11 this section shall apply after the end of the 12-month pe12 riod beginning on the date of the enactment of this Act.

13 SEC. 102. INTERSTATE BRANCHING BY NATIONAL BANKS.

14 Section 5155 of the Revised Statutes (12 U.S.C. 36)

15 is amended—

16 (1) by redesignating subsections (d) through (h)

17 as subsections (g) through (k), respectively; and

18 (2) by inserting after subsection (c) the follow19 ing new subsections:

20 ‘‘(d) INTERSTATE BRANCHING BY NATIONAL

21 BANKS.—

22 ‘‘(1) APPROVALS OF ACQUISITION OF EXISTING

23 BRANCHES AUTHORIZED.—Subject to paragraph (3)

24 and subsections (e) and (f), after the end of the 3-

25 year period beginning on the date of the enactment
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1 of the Interstate Banking Efficiency Act of 1994,

2 the Comptroller of the Currency may approve an ap3 plication under this section to allow a national bank

4 to acquire and operate a branch located outside the

5 home State of such bank if the conditions estab6 lished in paragraph (5) are met.

7 ‘‘(2) STATE ‘OPT-IN’ ELECTION TO PERMIT

8 INTERSTATE BRANCHING THROUGH DE NOVO

9 BRANCHES.—Subject to subsections (e) and (f), the

10 Comptroller of the Currency may approve an appli11 cation by a national bank to establish a de novo

12 branch in a State other than the home State of such

13 bank if—

14 ‘‘(A) there is in effect in the host State a

15 law that—

16 ‘‘(i) expressly permits all out-of-State

17 banks to establish de novo branches in

18 such State; and

19 ‘‘(ii) applies equally to national and

20 State banks; and

21 ‘‘(B) the conditions established in para22 graph (5) are met.

23 ‘‘(3) STATE ‘OPT-OUT’ ELECTION TO PROHIBIT

24 INTERSTATE BRANCHING BY ACQUISITION OF EXIST25 ING BANKS.—
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1 ‘‘(A) IN GENERAL.—An application by a

2 national bank to establish a branch in a State

3 other than the home State of such bank

4 through the acquisition of an existing bank or

5 branch in the host State may not be approved

6 by the Comptroller of the Currency if there is

7 in effect in the host State a law that—

8 ‘‘(i) was enacted during the period be9 ginning on January 1, 1990, and ending 3

10 years after the date of the enactment of

11 the Interstate Banking Efficiency Act of

12 1994;

13 ‘‘(ii) expressly prohibits all out-of14 State banks from acquiring a branch lo15 cated in such State through the acquisition

16 of an existing bank in the host State; and

17 ‘‘(iii) applies equally to national and

18 State banks.

19 ‘‘(B) EFFECT OF PROHIBITION.—A na20 tional bank whose home State is a State that

21 has in effect a prohibition described in subpara22 graph (A) may not acquire or establish a

23 branch located in any other State under this

24 subsection.
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1 ‘‘(4) EARLY APPROVAL AUTHORIZED IF STATE

2 LAW PERMITS.—The Comptroller of the Currency

3 may approve an application under paragraph (1) be4 fore the expiration of the 3-year period described in

5 such paragraph if the State in which the branch is

6 or will be located has in effect a law which expressly

7 permits interstate branching by all national and

8 State banks.

9 ‘‘(5) CONDITIONS APPLICABLE TO THE ESTAB10 LISHMENT OR ACQUISITION OF INTERSTATE

11 BRANCHES.—The Comptroller of the Currency may

12 approve an application under paragraph (1) or (2)

13 by a national bank to acquire or establish a branch

14 only if—

15 ‘‘(A) the national bank is adequately cap16 italized (as defined under section 38 of the Fed17 eral Deposit Insurance Act) as of the date the

18 application is filed; and

19 ‘‘(B) the Comptroller of the Currency de20 termines that—

21 ‘‘(i) the national bank will continue to

22 be adequately capitalized (as so defined)

23 upon consummation of the acquisition or

24 establishment of the branch; and
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1 ‘‘(ii) on the basis of an evaluation

2 conducted by the Comptroller, the manage3 ment of the bank has the necessary man4 agement skills to manage the extended op5 erations of the bank upon consummation

6 of the acquisition or establishment of the

7 branch.

8 ‘‘(e) PROVISIONS APPLICABLE TO APPLICATION AND

9 APPROVAL PROCESS.—

10 ‘‘(1) CONSULTATION WITH STATE BANK SUPER11 VISOR.—In determining whether to grant approval

12 of an application under subsection (d), the Comp13 troller of the Currency shall consider the views of

14 any appropriate State bank supervisor of the bank

15 which submits the application regarding the bank’s

16 compliance with applicable State community rein17 vestment laws.

18 ‘‘(2) COMPLIANCE WITH STATE FILING RE19 QUIREMENTS.—

20 ‘‘(A) IN GENERAL.—An out-of-State na21 tional bank that files an application under sub22 section (d) to acquire or establish a branch

23 within a host State shall—

24 ‘‘(i) comply with any filing require25 ment of the host State that—
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1 ‘‘(I) is not discriminatory in na2 ture; and

3 ‘‘(II) is similar in effect to any

4 requirement imposed by the host

5 State on a nonbanking corporation

6 from another State that seeks to en7 gage in business in the host State;

8 and

9 ‘‘(ii) submit a copy of the application

10 to the State bank supervisor of the host

11 State.

12 ‘‘(B) PENALTY FOR FAILURE TO COM13 PLY.—The Comptroller of the Currency may

14 not approve an application under subsection (d)

15 by an out-of-State national bank which materi16 ally fails to comply with clause (i) or (ii) of sub17 paragraph (A) with respect to such application.

18 ‘‘(3) CONCENTRATION LIMITS.—

19 ‘‘(A) IN GENERAL.—The Comptroller of

20 the Currency may not approve an acquisition by

21 a bank under subsection (d) of a branch located

22 in a State other than the home State of such

23 bank if—

24 ‘‘(i) the bank (including all insured

25 depository institutions which are affiliates
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1 of the bank) controls, or upon completion

2 of the acquisition would control, more than

3 10 percent of the total amount of insured

4 depository institution deposits in the Unit5 ed States, as determined under regulations

6 which the Board of Governors of the Fed7 eral Reserve System shall prescribe; or

8 ‘‘(ii) the bank (including all insured

9 depository institutions which are affiliates

10 of the bank) controls, or upon completion

11 of the acquisition would control, 30 percent

12 or more of the total amount of insured de13 pository institution deposits in the State in

14 which the branch to be acquired is located,

15 as determined under regulations which the

16 Board of Governors of the Federal Reserve

17 System shall prescribe.

18 ‘‘(B) NOT APPLICABLE TO DE NOVO OUT19 OF-STATE BRANCHES.—Subparagraph (A) shall

20 not apply to the establishment of a de novo

21 branch outside the home State of a national

22 bank.

23 ‘‘(C) WAIVER BY STATE.—A State may

24 waive the application of subparagraph (A)(ii) to

25 the acquisition of branches in such State.
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1 ‘‘(4) DEFINITIONS.—For purposes of this sub2 section and subsections (d) and (f) the following

3 definitions shall apply:

4 ‘‘(A) DE NOVO BRANCH.—The term ‘de

5 novo branch’ means a branch of a national

6 bank which—

7 ‘‘(i) is originally established by the na8 tional bank as a branch; and

9 ‘‘(ii) does not become a branch of

10 such bank as a result of—

11 ‘‘(I) the acquisition by the bank

12 of an insured depository institution or

13 a branch of an insured depository in14 stitution; or

15 ‘‘(II) the conversion, merger, or

16 consolidation of any such institution

17 or branch.

18 ‘‘(B) HOME STATE.—The term ‘home

19 State’ means, with respect to a national bank,

20 the State in which the main office of the bank

21 is located.

22 ‘‘(C) HOST STATE.—The term ‘host State’

23 means any State in which a national bank es24 tablishes or maintains a branch other than the

25 home State of such bank.
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1 ‘‘(D) INSURED DEPOSITORY INSTITU2 TION.—The term ‘insured depository institu3 tion’ has the same meaning as in section

4 3(c)(2) of the Federal Deposit Insurance Act.

5 ‘‘(E) OUT-OF-STATE BANK.—The term

6 ‘out-of-State bank’ means, with respect to any

7 State, a bank whose home State is another

8 State.

9 ‘‘(F) STATE BANK SUPERVISOR.—The

10 term ‘State bank supervisor’ has the same

11 meaning as in section 3(r) of the Federal De12 posit Insurance Act.

13 ‘‘(f) APPLICABILITY OF STATE AND FEDERAL LAW

14 TO INTERSTATE BRANCHING OPERATIONS.—

15 ‘‘(1) CERTAIN STATE LAWS APPLICABLE TO NA16 TIONAL BANK BRANCHES.—

17 ‘‘(A) IN GENERAL.—Any branch of a na18 tional bank which is established or acquired

19 under subsection (d) shall be subject to the laws

20 of the host State with respect to intrastate

21 branching, consumer protection, fair lending,

22 and community reinvestment as if the branch

23 were a branch of a bank chartered by that

24 State except to the extent any such State law
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1 is preempted by Federal law regarding the

2 same subject.

3 ‘‘(B) PROHIBITION ON DISCRIMINATORY

4 EFFECT.—Notwithstanding subparagraph (A),

5 a branch of a national bank which is established

6 or acquired under subsection (d) shall not be

7 subject to a State law described in such sub8 paragraph to the extent the Comptroller of the

9 Currency determines that the application of the

10 law has, or would have, a discriminatory effect

11 on the branch in comparison with the effect the

12 application of such law has with respect to

13 branches of a bank chartered by the State.

14 ‘‘(C) ENFORCEMENT OF APPLICABLE

15 STATE LAWS.—The provisions of any State law

16 to which a branch of a national bank is subject

17 under this subparagraph shall be enforced, with

18 respect to such branch, by the Comptroller of

19 the Currency.

20 ‘‘(2) TREATMENT OF BRANCH AS BANK.—All

21 laws of a host State, other than the laws described

22 in paragraph (1) or laws pertaining to the applica23 tion or administration of any tax or method of tax24 ation, shall apply to a branch (in such State) of an

25 out-of-State national bank in the same manner and
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1 to the same extent such laws would apply if the

2 branch were a national bank located in that State.

3 ‘‘(3) STATE TAXATION AUTHORITY NOT AF4 FECTED.—No provision of this subsection or sub5 section (d) or (e) shall be construed as affecting the

6 authority of any State or political subdivision of any

7 State to apply and administer any tax or method of

8 taxation to any national bank, including any branch

9 of a national bank, or any bank holding company

10 which controls a national bank, to the extent such

11 tax or tax method is otherwise permissible by or

12 under the Constitution of the United States of

13 America or other Federal law.

14 ‘‘(4) STATE-IMPOSED CONDITIONS ON INTER15 STATE BRANCHING.—Subject to paragraphs (3) and

16 (5), a host State may impose any notification or re17 porting requirement on a branch established or ac18 quired under subsection (d)(1) if the requirement—

19 ‘‘(A) does not discriminate against out-of20 State banks or bank holding companies; and

21 ‘‘(B) is not preempted by any Federal law

22 regarding the same subject.

23 ‘‘(5) APPLICABILITY OF DEPOSIT CAPS AND

24 ANTITRUST LAWS.—No provision of this subsection
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1 or subsection (d) or (e) shall be construed as affect2 ing—

3 ‘‘(A) the authority of any State to limit the

4 percentage of the total amount of insured de5 pository institution deposits in the State which

6 may be held or controlled by any bank (includ7 ing all insured depository institutions which are

8 affiliates of the bank) to the extent the applica9 tion of such limitation does not discriminate

10 against out-of-State banks or bank holding

11 companies; or

12 ‘‘(B) the applicability of any Federal anti13 trust law or any State antitrust law that does

14 not discriminate against out-of-State banks or

15 bank holding companies.’’.

16 SEC. 103. INTERSTATE BRANCHING BY STATE BANKS.

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

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

19 the end the following new section:

20 ‘‘SEC. 45. STATE BANK BRANCHES.

21 ‘‘(a) CONSENT OF CORPORATION.—

22 ‘‘(1) ESTABLISHMENT OF BRANCHES.—No

23 State nonmember insured bank (except a District

24 bank) may establish and operate any new domestic
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1 branch without the prior written consent of the

2 Corporation.

3 ‘‘(2) CHANGE OF LOCATION OF STATE BANK

4 OFFICES AND BRANCHES.—No State nonmember in5 sured bank (except a District bank) may move the

6 main office or any domestic branch of such bank

7 from 1 location to another without the prior written

8 consent of the Corporation.

9 ‘‘(3) CHANGE OF LOCATION OF INSURED

10 BRANCH OF FOREIGN BANK.—No foreign bank may

11 move any insured branch from 1 location to another

12 without the prior written consent of the Corporation.

13 ‘‘(4) FACTORS TO BE CONSIDERED.—The Cor14 poration shall consider the factors enumerated in

15 section 6 in making any determination under this

16 subsection.

17 ‘‘(b) ESTABLISHMENT OF FOREIGN BRANCHES.—

18 ‘‘(1) IN GENERAL.—No State nonmember in19 sured bank shall establish or operate any foreign

20 branch without the prior written consent of the

21 Corporation.

22 ‘‘(2) CONDITIONS AND REGULATIONS.—The

23 Corporation may establish such conditions and pre24 scribe such regulations for the establishment and op25 eration of foreign branches of State nonmember
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1 banks as the Corporation may determine to be

2 appropriate.

3 ‘‘(c) INTERSTATE BRANCHING BY STATE BANKS.—

4 ‘‘(1) APPROVALS OF ACQUISITION OF EXISTING

5 BRANCHES AUTHORIZED.—Subject to paragraph (3)

6 and subsections (d) and (e), after the end of the 3-

7 year period beginning on the date of the enactment

8 of the Interstate Banking Efficiency Act of 1994, an

9 insured State bank may acquire and operate a

10 branch located outside the home State of such bank

11 with the prior written approval of the appropriate

12 Federal banking agency of an application by such

13 bank if the conditions established in paragraph (5)

14 are met.

15 ‘‘(2) STATE ‘OPT-IN’ ELECTION TO PERMIT

16 INTERSTATE BRANCHING THROUGH DE NOVO

17 BRANCHES.—Subject to subsections (d) and (e), the

18 appropriate Federal banking agency may approve an

19 application by a State bank to establish a de novo

20 branch in a State other than the home State of such

21 bank if—

22 ‘‘(A) there is in effect in the host State a

23 law that—
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1 ‘‘(i) expressly permits all out-of-State

2 banks to establish de novo branches in

3 such State; and

4 ‘‘(ii) applies equally to national and

5 State banks; and

6 ‘‘(B) the conditions established in para7 graph (5) are met.

8 ‘‘(3) STATE ‘OPT-OUT’ ELECTION TO PROHIBIT

9 INTERSTATE BRANCHING BY ACQUISITION OF EXIST10 ING BANKS.—

11 ‘‘(A) IN GENERAL.—An application by an

12 insured State bank to establish a branch in a

13 State other than the home State of such bank

14 through the acquisition of an existing bank or

15 branch in the host State may not be approved

16 by the appropriate Federal banking agency if

17 there is in effect in the host State a law that—

18 ‘‘(i) was enacted during the period be19 ginning on January 1, 1990, and ending 3

20 years after the date of the enactment of

21 the Interstate Banking Efficiency Act of

22 1994;

23 ‘‘(ii) expressly prohibits all out-of24 State banks from acquiring a branch lo-
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1 cated in such State through the acquisition

2 of an existing bank in the host State; and

3 ‘‘(iii) applies equally to national and

4 State banks.

5 ‘‘(B) EFFECT OF PROHIBITION.—An in6 sured State bank whose home State is a State

7 that has in effect a prohibition described in

8 subparagraph (A) may not acquire or establish

9 a branch located in any other State under sub10 section (c).

11 ‘‘(4) EARLY APPROVAL AUTHORIZED IF STATE

12 LAW PERMITS.—The appropriate Federal banking

13 agency may approve an application under paragraph

14 (1) before the expiration of the 3-year period de15 scribed in such paragraph if the State in which the

16 branch is or will be located has in effect a law which

17 expressly permits interstate branching by all na18 tional and State banks.

19 ‘‘(5) CONDITIONS APPLICABLE TO THE ESTAB20 LISHMENT OR ACQUISITION OF INTERSTATE

21 BRANCHES.—The appropriate Federal banking agen22 cy may approve an application under paragraph (1)

23 or (2) by an insured State bank to acquire or estab24 lish a branch only if—
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1 ‘‘(A) the bank is adequately capitalized (as

2 defined under section 38) as of the date the ap3 plication is filed;

4 ‘‘(B) the bank is authorized to establish

5 branches in other States under the law of the

6 home State of the bank; and

7 ‘‘(C) the appropriate Federal banking

8 agency determines that—

9 ‘‘(i) the bank will continue to be ade10 quately capitalized (as so defined) upon

11 consummation of the acquisition or estab12 lishment of the branch; and

13 ‘‘(ii) on the basis of an evaluation

14 conducted by the agency, the management

15 of the bank has the necessary management

16 skills to manage the bank upon completion

17 of the acquisition or establishment of the

18 branch.

19 ‘‘(d) PROVISIONS APPLICABLE TO APPLICATION AND

20 APPROVAL PROCESS.—

21 ‘‘(1) CONSULTATION WITH STATE BANK SUPER22 VISOR.—In determining whether to grant approval

23 of an application under subsection (c), the appro24 priate Federal banking agency shall consider the

25 views of any appropriate State bank supervisor of
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1 the bank which submits the application regarding

2 the bank’s compliance with applicable State commu3 nity reinvestment laws.

4 ‘‘(2) COMPLIANCE WITH STATE FILING RE5 QUIREMENTS.—

6 ‘‘(A) IN GENERAL.—An out-of-State in7 sured State bank that files an application under

8 subsection (c) to acquire or establish a branch

9 within a host State shall—

10 ‘‘(i) comply with any filing require11 ment of the host State that—

12 ‘‘(I) is not discriminatory in na13 ture; and

14 ‘‘(II) is similar in effect to a re15 quirement imposed by the host State

16 on a nonbanking corporation from an17 other State that seeks to engage in

18 business in the host State; and

19 ‘‘(ii) submit a copy of the application

20 to the State bank supervisor of the host

21 State.

22 ‘‘(B) PENALTY FOR FAILURE TO COM23 PLY.—The appropriate Federal banking agency

24 may not approve an application under sub25 section (c) by an insured State bank which ma-
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1 terially fails to comply with clause (i) or (ii) of

2 subparagraph (A) with respect to such applica3 tion.

4 ‘‘(3) CONCENTRATION LIMITS.—

5 ‘‘(A) IN GENERAL.—The appropriate Fed6 eral banking agency may not approve an acqui7 sition by a bank under subsection (c) of a

8 branch located in a State other than the home

9 State of such bank if—

10 ‘‘(i) the bank (including all insured

11 depository institutions which are affiliates

12 of the bank) controls, or upon completion

13 of the acquisition would control, more than

14 10 percent of the total amount of insured

15 depository institution deposits in the Unit16 ed States, as determined under regulations

17 which the Board of Governors of the Fed18 eral Reserve System shall prescribe; or

19 ‘‘(ii) the bank (including all insured

20 depository institutions which are affiliates

21 of the bank) controls, or upon completion

22 of the acquisition would control, 30 percent

23 or more of the total amount of insured de24 pository institution deposits in the State in

25 which the branch to be acquired is located,
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1 as determined under regulations which the

2 Board of Governors of the Federal Reserve

3 System shall prescribe.

4 ‘‘(B) NOT APPLICABLE TO DE NOVO OUT5 OF-STATE BRANCHES.—Subparagraph (A) shall

6 not apply to the establishment of a de novo

7 branch outside the home State of an insured

8 State bank.

9 ‘‘(C) WAIVER BY STATE.—A State may

10 waive the application of subparagraph (A)(ii) to

11 the acquisition of branches in such State.

12 ‘‘(e) APPLICABILITY OF STATE AND FEDERAL LAW

13 TO INTERSTATE BRANCHING OPERATIONS.—

14 ‘‘(1) STATE LAWS APPLICABLE TO BRANCHES

15 OF OUT-OF-STATE BANKS.—

16 ‘‘(A) IN GENERAL.—Subject to subsection

17 (d) and paragraph (2), any branch of an out18 of-State insured State bank shall be subject to

19 the laws of the host State as if such branch

20 were a branch of a bank chartered by that

21 State.

22 ‘‘(B) ACTIVITIES OF BRANCHES.—An in23 sured State bank that establishes a branch in

24 a host State may not conduct any activity at
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1 such branch that is not permissible for a bank

2 chartered by the host State.

3 ‘‘(C) RESERVATION OF CERTAIN RIGHTS

4 TO STATES.—No provision of this subsection or

5 subsection (c) or (d) shall be construed as limit6 ing in any way the right of a State to—

7 ‘‘(i) determine the authority of State

8 banks chartered in that State to establish

9 and maintain branches; or

10 ‘‘(ii) supervise, regulate, and examine

11 State banks chartered by that State.

12 ‘‘(2) STATE TAXATION AUTHORITY NOT AF13 FECTED.—No provision of this subsection or sub14 section (c) or (d) shall be construed as affecting the

15 authority of any State or political subdivision of any

16 State to apply and administer any tax or method of

17 taxation to any State bank, including any branch of

18 a State bank, or any bank holding company which

19 controls any State bank, to the extent such tax or

20 tax method is otherwise permissible by or under the

21 Constitution of the United States of America or

22 other Federal law.

23 ‘‘(3) STATE IMPOSED CONDITIONS ON INTER24 STATE BRANCHING.—Subject to paragraphs (2) and

25 (4), a host State may impose any notification or re-
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1 porting requirement on a branch established or ac2 quired under subsection (c) if the requirement—

3 ‘‘(A) does not discriminate against out-of4 State banks or bank holding companies; and

5 ‘‘(B) is not preempted by any Federal law

6 regarding the same subject.

7 ‘‘(4) APPLICABILITY OF DEPOSIT CAPS AND

8 ANTITRUST LAWS.—No provision of this subsection

9 or subsection (c) or (d) shall be construed as affect10 ing—

11 ‘‘(A) the authority of any State to limit the

12 percentage of the total amount of insured de13 pository institution deposits in the State which

14 may be held or controlled by any bank (includ15 ing all insured depository institutions which are

16 affiliates of the bank) to the extent the applica17 tion of such limitation does not discriminate

18 against out-of-State banks or bank holding

19 companies; or

20 ‘‘(B) the applicability of any Federal anti21 trust law or any State antitrust law that does

22 not discriminate against out-of-State banks or

23 bank holding companies.

24 ‘‘(f) COORDINATION OF EXAMINATION AUTHOR25 ITY.—
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1 ‘‘(1) IN GENERAL.—A host State bank super2 visor may examine a branch operated in the host

3 State by an out-of-State insured State bank to—

4 ‘‘(A) determine compliance with host State

5 laws regarding banking, community reinvest6 ment, fair lending, consumer protection, and

7 permissible activities; and

8 ‘‘(B) ensure that the activities of the

9 branch do not constitute a serious risk to the

10 safe and sound operation of the branch.

11 ‘‘(2) ENFORCEMENT.—If the State bank super12 visor of a host State described in paragraph (1) de13 termines that there is a violation of host State law

14 concerning the activities being conducted by a

15 branch operated in such State by an out-of-State in16 sured State bank or that the branch is being oper17 ated in an unsafe and unsound manner, such host

18 State bank supervisor may undertake such enforce19 ment actions or proceedings as would be permitted

20 under host State law if such branch were a bank

21 chartered by the host State.

22 ‘‘(3) COOPERATIVE AGREEMENT.—The State

23 bank supervisors of 1 or more States may enter into

24 cooperative agreements to facilitate State regulatory

25 supervision of State banks, including cooperative
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1 agreements relating to the coordination of examina2 tions and joint participation in examinations.

3 ‘‘(4) FEDERAL REGULATORY AUTHORITY.—

4 ‘‘(A) IN GENERAL.—No provision of this

5 section shall be construed as limiting the au6 thority of any Federal banking agency to exam7 ine any bank or branch of a bank for which the

8 agency is the appropriate Federal banking

9 agency.

10 ‘‘(B) REVIEW OF INTERSTATE AGREE11 MENTS.—If the appropriate Federal banking

12 agency determines that the States have failed to

13 reach an agreement under paragraph (3), or

14 that such an agreement fails to adequately pro15 tect the appropriate deposit insurance fund, the

16 appropriate Federal banking agency shall not

17 defer to State examinations of the out-of-State

18 branches.

19 ‘‘(g) DEFINITIONS.—For purposes of this section, the

20 following definitions apply:

21 ‘‘(1) DE NOVO BRANCH.—The term ‘de novo

22 branch’ means a branch of a bank which—

23 ‘‘(A) is originally established by the bank

24 as a branch; and
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1 ‘‘(B) does not become a branch of such

2 bank as a result of—

3 ‘‘(i) the acquisition by the bank of a

4 bank or branch; or

5 ‘‘(ii) the conversion, merger, or con6 solidation of any bank or branch.

7 ‘‘(2) HOME STATE.—The term ‘home State’

8 means, with respect to a State bank, the State by

9 whom the bank is chartered.

10 ‘‘(3) HOST STATE.—The term ‘host State’

11 means the State in which a bank establishes or

12 maintains a branch other than the home State of the

13 bank.

14 ‘‘(4) OUT-OF-STATE BANK.—The term ‘out-of15 State bank’ means, with respect to any State, a

16 bank whose home State is another State.’’.

17 SEC. 104. BRANCHING BY FOREIGN BANKS.

18 (a) IN GENERAL.—Section 5(a) of the International

19 Banking Act of 1978 (12 U.S.C. 3103(a)) is amended to

20 read as follows:

21 ‘‘(a) INTERSTATE BANKING OPERATIONS.—

22 ‘‘(1) FEDERAL BRANCH OR AGENCY.—Subject

23 to the provisions of this Act and with the prior writ24 ten approval of the Board and the Comptroller of

25 the Currency, a foreign bank may establish and op-
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1 erate a Federal branch or agency in any State out2 side the home State of such foreign bank to the ex3 tent that the establishment and operation of such

4 branch would be permitted under section 5155 of

5 the Revised Statutes if the foreign bank were a na6 tional bank whose home State (as defined in sub7 section (e)(4) of such section) is the same State as

8 the home State of the foreign bank.

9 ‘‘(2) STATE BRANCH OR AGENCY.—Subject to

10 the provisions of this Act and with the prior written

11 approval of the Board and the appropriate State

12 bank supervisor, a foreign bank may establish and

13 operate a State branch or agency in any State out14 side the home State of such foreign bank to the ex15 tent that such establishment and operation would be

16 permitted under section 45 of the Federal Deposit

17 Insurance Act if the foreign bank were a State bank

18 whose home State (as defined in subsection (g) of

19 such section) is the same State as the home State

20 of the foreign bank.

21 ‘‘(3) CRITERIA FOR DETERMINATION.—In ap22 proving an application under paragraph (1) or (2),

23 the Board and (in the case of an application under

24 paragraph (1)) the Comptroller of the Currency—
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1 ‘‘(A) shall apply the standards applicable

2 to the establishment of a foreign bank office in

3 the United States under section 7(d); and

4 ‘‘(B) may not approve an application un5 less the Board and (in the case of an applica6 tion under paragraph (1)) the Comptroller of

7 the Currency—

8 ‘‘(i) determine that the foreign bank’s

9 financial resources, including the capital

10 level of the bank, are equivalent to those

11 required for a domestic bank to be ap12 proved for branching under section 5155 of

13 the Revised Statutes and section 45 of the

14 Federal Deposit Insurance Act; and

15 ‘‘(ii) in the case of the first applica16 tion by such foreign bank under paragraph

17 (1) or (2) after the date of the enactment

18 of the Interstate Banking Efficiency Act of

19 1994, consult with the Secretary of the

20 Treasury regarding capital equivalency.

21 ‘‘(4) REQUIREMENT FOR A SEPARATE SUBSIDI22 ARY.—If the Board or the Comptroller of the Cur23 rency, taking into account differing regulatory or ac24 counting standards, finds that adherence by a for25 eign bank to capital requirements equivalent to those
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1 imposed under section 5155 of the Revised Statutes

2 and section 45 of the Federal Deposit Insurance Act

3 could be verified only if the banking activities of

4 such bank in the United States are carried out in a

5 domestic banking subsidiary within the United

6 States, the Board and the Comptroller of the Cur7 rency may approve an application under paragraph

8 (1) subject to a requirement that the foreign bank

9 or company controlling the foreign bank establish a

10 domestic banking subsidiary in the United States.

11 ‘‘(5) ADDITIONAL AUTHORITY FOR INTERSTATE

12 BRANCHES AND AGENCIES OF FOREIGN BANKS.—

13 Notwithstanding paragraphs (1) and (2) and section

14 4(h), a foreign bank may, with the approval of the

15 Comptroller of the Currency, establish and operate

16 a Federal branch or Federal agency or, with the ap17 proval of the Board and the appropriate State bank

18 supervisor, a State branch or State agency in any

19 State outside the foreign bank’s home State if—

20 ‘‘(A) the establishment and operation of a

21 branch or agency is expressly permitted by the

22 State in which the branch or agency is to be es23 tablished; and

24 ‘‘(B) in the case of a Federal or State

25 branch, the branch receives only such deposits
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1 as would be permissible for a corporation orga2 nized under section 25A of the Federal Reserve

3 Act.’’.

4 (b) CONTINUED AUTHORITY FOR LIMITED

5 BRANCHES, AGENCIES, OR COMMERCIAL LENDING COM6 PANIES.—Section 5(b) of the International Banking Act

7 of 1978 (12 U.S.C. 3103(b)) is amended by adding at the

8 end the following new sentence: ‘‘Notwithstanding sub9 section (a), a foreign bank may continue to operate, after

10 the enactment of the Interstate Banking Efficiency Act

11 of 1994, any Federal branch, State branch, Federal agen12 cy, State agency, or commercial lending company subsidi13 ary which such bank was operating on the day before the

14 date of the enactment of such Act to the extent the

15 branch, agency, or subsidiary continues, after the enact16 ment of such Act, to engage in operations which were law17 ful under the laws in effect on the day before such date.’’.

18 (c) CLARIFICATION OF BRANCHING RULES IN THE

19 CASE OF A FOREIGN BANK WITH A DOMESTIC BANK

20 SUBSIDIARY.—Section 5 of the International Banking Act

21 of 1978 (12 U.S.C. 3103) is amended by adding at the

22 end the following new subsection:

23 ‘‘(d) CLARIFICATION OF BRANCHING RULES IN THE

24 CASE OF A FOREIGN BANK WITH A DOMESTIC BANK
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1 SUBSIDIARY.—In the case of a foreign bank that has a

2 domestic bank subsidiary within the United States—

3 ‘‘(1) the fact that such bank controls a domes4 tic bank shall not affect the authority of the foreign

5 bank to establish Federal and State branches or

6 agencies to the extent permitted under subsection

7 (a); and

8 ‘‘(2) the fact that the domestic bank is con9 trolled by a foreign bank which has Federal or State

10 branches or agencies in States other than the home

11 State of such domestic bank shall not affect the au12 thority of the domestic bank to establish branches

13 outside the home State of the domestic bank to the

14 extent permitted under section 5155(d) of the Re15 vised Statutes or section 45 of the Federal Deposit

16 Insurance Act, as the case may be.’’.

17 (d) HOME STATE DETERMINATIONS.—

18 (1) METHOD OF DETERMINING.—Section 4(h)

19 of the International Banking Act of 1978 (12 U.S.C.

20 3102(h)) is amended—

21 (A) by striking ‘‘in the State in which such

22 branch or agency is located’’; and

23 (B) by adding at the end the following sen24 tence: ‘‘For the purposes of section 5155(c) of

25 the Revised Statutes, the home State of a for-
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1 eign bank shall be the bank’s home State as de2 termined under section 5(c).’’.

3 (2) SINGLE STATE DETERMINATIONS.—Section

4 5(c) of the International Banking Act of 1978 (12

5 U.S.C. 3103(c)) is amended to read as follows:

6 ‘‘(c) DETERMINATION OF HOME STATE OF FOREIGN

7 BANK.—For the purposes of this section—

8 ‘‘(1) in the case of a foreign bank that has any

9 branch, agency, subsidiary commercial lending com10 pany, or subsidiary bank in more than 1 State, the

11 home State of the foreign bank is the 1 State of

12 such States which is selected by the foreign bank or,

13 in default of any such selection, by the Board; and

14 ‘‘(2) in the case of a foreign bank that does not

15 have a branch, agency, subsidiary commercial lend16 ing company, or subsidiary bank in more than 1

17 State, the home State of the foreign bank is the

18 State in which the foreign bank has a branch, agen19 cy, subsidiary commercial lending company, or sub20 sidiary bank.’’.

21 SEC. 105. INTERSTATE CONSOLIDATIONS.

22 Section 18(d) of the Federal Deposit Insurance Act

23 (12 U.S.C. 1828(d)) is amended to read as follows:

24 ‘‘(d) INTERSTATE CONSOLIDATIONS.—

25 ‘‘(1) CONSOLIDATIONS AUTHORIZED.—
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1 ‘‘(A) IN GENERAL.—Except as provided in

2 section 3(d)(1) of the Bank Holding Company

3 Act of 1956 and notwithstanding any other pro4 vision of Federal law or any provision of State

5 law (other than a law referred to in subpara6 graph (B)), a bank holding company which has

7 bank subsidiaries in more than 1 State may,

8 after the end of the 18-month period beginning

9 on the date of the enactment of the Interstate

10 Banking Efficiency Act of 1994 and subject to

11 the requirements of subsection (c), combine 2

12 or more of such banks into a single bank by

13 means of merger, consolidation, or other similar

14 transaction in accordance with such subsection.

15 ‘‘(B) EXCEPTION FOR STATES WHICH PRO16 HIBIT THE ACQUISITION OF A BRANCH BY ANY

17 OUT-OF-STATE BANK.—No bank which is lo18 cated in a State in which a law described in

19 section 5155(d)(3)(A) of the Revised Statutes

20 of the United States or section 45(c)(3)(A) is in

21 effect may be a party to a merger, consolida22 tion, or other similar transaction under sub23 paragraph (A) with any other bank affiliate of

24 such bank.
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1 ‘‘(C) EXCEPTION FOR CERTAIN BANKS AC2 QUIRED DURING TRANSITION PERIOD.—No

3 bank subsidiary of a bank holding company, or

4 any branch of any such bank—

5 ‘‘(i) control of which was acquired, di6 rectly or indirectly, by such company after

7 the end of the 18-month period beginning

8 on the date of the enactment of the Inter9 state Banking Efficiency Act of 1994; and

10 ‘‘(ii) which is located in a State in

11 which the company did not control any

12 bank or branch as of the end of such 18-

13 month period,

14 may be a party to a merger, consolidation, or

15 other similar transaction under subparagraph

16 (A) with any other bank affiliate of such bank

17 before the end of the 3-year period beginning

18 on such date of enactment, unless the State in

19 which the bank or branch is located is a State

20 referred to in section 5155(d)(4) of the Revised

21 Statutes of the United States or section

22 45(c)(4).

23 ‘‘(2) ADDITIONAL BRANCHES.—

24 ‘‘(A) IN GENERAL.—The consolidated bank

25 which results from a transaction under para-
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1 graph (1) may, subject to compliance with all

2 applicable Federal or State laws relating to the

3 establishment, acquisition, or operation of a

4 branch, establish or acquire, and operate, addi5 tional branches at any location where the con6 solidated bank, or any preexisting bank which

7 was part of such transaction, could have estab8 lished or acquired, and operated, a branch if

9 the consolidated or preexisting bank had not

10 been a party to the transaction.

11 ‘‘(B) EXCEPTION FOR CERTAIN STATES.—

12 Subparagraph (A) shall not apply in any State

13 in which the establishment or acquisition, and

14 operation, of any additional branches of a con15 solidated bank is prohibited by any provision of

16 State law which was in existence on the date of

17 the enactment of the Interstate Banking Effi18 ciency Act of 1994.

19 ‘‘(3) EFFECT OF STATE PROHIBITION ON

20 BRANCHING.—If a branch which results from a

21 transaction under paragraph (1) is located in a

22 State in which a law—

23 ‘‘(A) takes effect after the consummation

24 of the transaction;
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1 ‘‘(B) is enacted during the period begin2 ning on January 1, 1990, and ending 3 years

3 after the date of the enactment of the Inter4 state Banking Efficiency Act of 1994;

5 ‘‘(C) expressly prohibits all out-of-State

6 banks from acquiring a branch located in such

7 State through the acquisition of an existing

8 bank in the host State; and

9 ‘‘(D) applies equally to national and State

10 banks,

11 the branch shall be promptly converted back into a

12 bank as the bank existed before such transaction, in

13 accordance with regulations of the Federal banking

14 agency or State bank supervisor which had jurisdic15 tion over the bank which was converted into a

16 branch.

17 ‘‘(4) APPLICABILITY OF STATE AND FEDERAL

18 LAW TO INTERSTATE BRANCHING OPERATIONS.—If

19 a branch which results from a transaction under

20 paragraph (1) is the branch of a national bank, sec21 tion 5155(f) of the Revised Statutes of the United

22 States shall apply with respect to such branch.

23 ‘‘(5) STATE TAXATION AUTHORITY NOT AF24 FECTED.—No provision of this subsection shall be

25 construed as affecting the authority of any State or
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1 political subdivision of any State to apply and ad2 minister any tax or method of taxation to any bank

3 subsidiary or additional branch resulting from a con4 solidation or other transaction under paragraph (1)

5 or (2), or to any bank holding company which con6 trols any bank or branch resulting from any such

7 consolidation or other transaction, to the extent such

8 tax or tax method is otherwise permissible by or

9 under the Constitution of the United States of

10 America or other Federal law.

11 ‘‘(6) PLAN ON MEETING LOCAL CREDIT

12 NEEDS.—The responsible agency (as determined

13 under subsection (c)(2)) may not approve any appli14 cation for any consolidation or other transaction

15 under this subsection unless the responsible agency

16 has considered a plan submitted by the applicant

17 bank holding company for meeting local credit needs

18 in the communities served by any bank subsidiary of

19 the company which is involved in the proposed con20 solidation or transaction, including the extent to

21 which the amount of the anticipated savings attrib22 utable to the proposed consolidation or other trans23 action will be available to meet such local credit

24 needs.’’.
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1 SEC. 106. PROHIBITION AGAINST DEPOSIT PRODUCTION

2 OFFICES.

3 (a) REGULATIONS.—Before the end of the 120-day

4 period beginning on the date of the enactment of the

5 Interstate Banking Efficiency Act of 1994, the appro6 priate Federal banking agency shall prescribe regulations

7 which prohibit any person from using any authority to en8 gage in interstate branching pursuant to this title, or any

9 amendment made by this title to any other provision of

10 law, primarily for the purpose of deposit production.

11 (b) GUIDELINES FOR MEETING CREDIT NEEDS.—

12 Regulations issued under subsection (a) shall include

13 guidelines to ensure that each interstate branch meets the

14 credit needs of the community and market area in which

15 the branch operates.

16 (c) LIMITATION ON OUT-OF-STATE LOANS.—

17 (1) LIMITATION.—Regulations issued under

18 subsection (a) shall require that if the percentage of

19 outstanding loans made by an interstate branch to

20 borrowers located in the host State of, or market

21 area served by, the branch is less than half the aver22 age of such percentage for all Federal depository in23 stitutions and State depository institutions having

24 their principal place of operations in the host State

25 or that market area—
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1 (A) the appropriate Federal banking agen2 cy for the branch shall review the loan portfolio

3 of the branch and determine whether the

4 branch is reasonably meeting the credit needs

5 of the community and market area in which the

6 branch operates; and

7 (B) if the agency determines that the

8 branch is not reasonably meeting those needs—

9 (i) the branch shall be closed, and

10 (ii) the person which established the

11 branch may not open a new branch in that

12 State unless the person provides reasonable

13 assurances to the satisfaction of the appro14 priate Federal banking agency that the

15 new branch will reasonably meet the credit

16 needs of the community and market area

17 in which the new branch will operate.

18 (2) CONSIDERATIONS.—In making a determina19 tion under paragraph (1)(A) regarding an interstate

20 branch, the appropriate Federal banking agency

21 shall consider—

22 (A) whether the branch was acquired as

23 part of the purchase of a failed or failing depos24 itory institution;
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1 (B) whether the branch has a higher con2 centration of commercial and credit card lend3 ing; and

4 (C) the ratings received by the branch in

5 evaluations under the Community Reinvestment

6 Act of 1977.

7 (d) APPLICATION.—This section shall not apply to

8 any interstate branch acquired before January 1, 1992,

9 as part of any consolidation or merger of depository insti10 tutions.

11 (e) DEFINITIONS.—For the purposes of this sec12 tion—

13 (1) APPROPRIATE FEDERAL BANKING AGEN14 CY.—The term ‘‘appropriate Federal banking agen15 cy’’ has the same meaning as in section 3 of the

16 Federal Deposit Insurance Act.

17 (2) BRANCH.—The term ‘‘branch’’ means any

18 office, agency, or other place of business located in

19 any State at which deposits are received, checks

20 paid, or money lent.

21 (3) FEDERAL DEPOSITORY INSTITUTION AND

22 STATE DEPOSITORY INSTITUTION.—The terms

23 ‘‘Federal depository institution’’ and ‘‘State deposi24 tory institution’’ have the same meanings as in sec25 tion 3 of the Federal Deposit Insurance Act.
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1 (4) HOST STATE DEFINED.—The term ‘‘host

2 State’’ means the State in which a bank establishes

3 or maintains a branch, other than—

4 (A) in the case of a insured State bank,

5 the State in which the bank is chartered;

6 (B) in the case of a national bank, the

7 State in which the main office of the bank is lo8 cated; and

9 (C) in the case of a bank holding company,

10 the State in which the total deposits of all bank

11 subsidiaries of such company is the largest.

12 (5) INTERSTATE BRANCH.—The term ‘‘inter13 state branch’’ means a branch established pursuant

14 to the authority referred to in subsection (a).

15 (6) PRINCIPAL PLACE OF OPERATIONS.—The

16 term ‘‘principal place of operations’’ means the State

17 in which the total deposits of all bank subsidiaries

18 of a person are largest.

19 (7) STATE DEFINED.—The term ‘‘State’’ has

20 the same meaning as in section 3 of the Federal De21 posit Insurance Act.

22 SEC. 107. RESTATEMENT OF EXISTING LAW.

23 No provision of this title and no amendment made

24 by this title to any other provision of law shall be con25 strued as affecting in any way the right of any State, or
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1 any political subdivision of any State, to impose or main2 tain a nondiscriminatory franchise tax or other non3 property tax instead of a franchise tax in accordance with

4 section 3124 of title 31, United States Code.

5 TITLE II—CRA EVALUATIONS

6 SEC. 201. STATE-BY-STATE CRA EVALUATIONS OF DEPOSI7 TORY INSTITUTIONS WITH INTERSTATE

8 BRANCHES.

9 Section 807 of the Community Reinvestment Act of

10 1977 (12 U.S.C. 2906) is amended by adding at the end

11 the following new subsection:

12 ‘‘(d) INSTITUTIONS WITH INTERSTATE

13 BRANCHES.—

14 ‘‘(1) STATE-BY-STATE EVALUATION.—In the

15 case of a regulated financial institution which main16 tains 1 or more domestic branches located outside

17 the State in which the institution’s principal place of

18 business is located (hereafter in this subsection re19 ferred to as the ‘home State’), the appropriate Fed20 eral financial supervisory agency shall prepare—

21 ‘‘(A) a written evaluation of the entire in22 stitution’s record of performance under this

23 Act, as required by subsections (a), (b), and (c)

24 of this section; and
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1 ‘‘(B) for each State in which the institu2 tion maintains 1 or more domestic branches

3 (including the institution’s home State), a sepa4 rate written evaluation of the institution’s

5 record of performance within such State under

6 this Act, as required by subparagraphs (A) and

7 (B) of subsection (b)(1) of this section.

8 ‘‘(2) CONTENT OF STATE LEVEL EVALUA9 TION.—A written evaluation prepared pursuant to

10 paragraph (1)(B) of this subsection shall report the

11 information required by such paragraph separately

12 for each metropolitan area (as defined by the appro13 priate Federal financial supervisory agency) in which

14 the regulated financial institution maintains 1 or

15 more domestic branch offices and separately for the

16 nonmetropolitan portion of the State if the institu17 tion maintains 1 or more domestic branch offices in

18 such nonmetropolitan area.’’.

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