I

103D CONGRESS

1ST SESSION H. R. 1594

To reduce the amount of deposit insurance for insured depository institutions

from $100,000 to $25,000.

IN THE HOUSE OF REPRESENTATIVES

APRIL 1, 1993

Mr. CRANE introduced the following bill; which was referred to the Committee

on Banking, Finance and Urban Affairs

A BILL

To reduce the amount of deposit insurance for insured

depository institutions from $100,000 to $25,000.

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 ‘‘Deposit Insurance Re5 duction Act of 1993’’.

6 SEC. 2. REDUCTION IN DEPOSIT INSURANCE FROM $100,000

7 TO $25,000.

8 (a) FDIC INSURED DEPOSITORY INSTITUTIONS.—

9 (1) IN GENERAL.—Section 11(a)(1)(B) of the

10 Federal Deposit Insurance Act (12 U.S.C.
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1 1821(a)(1)(B)) is amended by striking ‘‘$100,000’’

2 and inserting ‘‘$25,000’’.

3 (2) TRUST FUNDS.—

4 (A) IN GENERAL.—Section 7(i) of the Fed5 eral Deposit Insurance Act (12 U.S.C. 1817(i))

6 is amended by striking ‘‘$100,000’’ and insert7 ing ‘‘$25,000’’.

8 (B) SUBSEQUENT AMENDMENT.—Effective

9 on the effective date of the amendment made by

10 section 311(b)(3) of the Federal Deposit Insur11 ance Corporation Improvement Act of 1991,

12 section 7(i)(1) of the Federal Deposit Insurance

13 Act (as amended by such section 311(b)(3)) is

14 amended by striking ‘‘$100,000’’ and inserting

15 ‘‘$25,000’’.

16 (3) OTHER LIMITS ON DEPOSIT INSURANCE.—

17 (A) IN GENERAL.—Paragraphs (2)(A) and

18 (3) of section 11(a) of the Federal Deposit In19 surance Act (12 U.S.C. 1821(a)) are amended

20 by striking ‘‘$100,000’’ each place such term

21 appears and inserting ‘‘$25,000’’.

22 (B) SUBSEQUENT AMENDMENT.—Effective

23 on the effective date of the amendment made by

24 section 311(b)(2) of the Federal Deposit Insur25 ance Corporation Improvement Act of 1991,
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1 section 11(a)(3)(A) of the Federal Deposit In2 surance Act (as amended by such section

3 311(b)(2)) is amended by striking ‘‘$100,000’’

4 and inserting ‘‘$25,000’’.

5 (4) EFFECTIVE DATE.—The amendments made

6 by paragraphs (1), (2), and (3) shall take effect at

7 the end of the 60-day period beginning on the date

8 of the enactment of this Act.

9 (5) TRANSITION PERIOD.—Notwithstanding the

10 amendments made by paragraphs (1), (2), and (3),

11 if the total amount of insured deposits of any de12 positor at any insured depository institution (deter13 mined as of the close of business on the day before

14 the effective date of such amendments under para15 graph (4)) exceeds $25,000, such excess amount

16 may continue to be treated, in accordance with regu17 lations which the Federal Deposit Insurance Cor18 poration shall prescribe, as insured deposits in the

19 manner provided in section 8(a)(7) of the Federal

20 Deposit Insurance Act during the 1-year period be21 ginning on such effective date.

22 (6) NOTICE.—The Federal Deposit Insurance

23 Corporation shall require, by regulation, each in24 sured depository institution to provide notice to each
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1 accountholder at such institution before the end of

2 the 60-day period described in paragraph (4) of—

3 (A) the reduction in the amount of deposit

4 insurance available on deposits at the institu5 tion; and

6 (B) the transition rules prescribed pursu7 ant to paragraph (5).

8 (7) ENFORCEMENT.—For purposes of enforcing

9 any requirement of this subsection or any regulation

10 prescribed by the Federal Deposit Insurance Cor11 poration pursuant to this subsection, such Corpora12 tion shall be treated as the appropriate Federal

13 banking agency for any insured depository institu14 tion.

15 (8) INSURED DEPOSITORY INSTITUTIONS DE16 FINED.—For purposes of this subsection, the term

17 ‘‘insured depository institution’’ has the meaning

18 given to such term in section 3(c)(2) of the Federal

19 Deposit Insurance Act.

20 (b) NCUA INSURED CREDIT UNIONS.—

21 (1) IN GENERAL.—Paragraphs (1), (2)(A), and

22 (3) of section 207(k) of the Federal Credit Union

23 Act (12 U.S.C. 1787(k)) are amended by striking

24 ‘‘$100,000’’ each place such term appears and in25 serting ‘‘$25,000’’.
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1 (2) EFFECTIVE DATE.—The amendments made

2 by paragraph (1) shall take effect at the end of the

3 60-day period beginning on the date of the enact4 ment of this Act.

5 (3) TRANSITION PERIOD.—Notwithstanding the

6 amendments made by paragraph (1), if the total

7 amount of insured deposits of any accountholder at

8 any insured credit union (determined as of the close

9 of business on the day before the effective date of

10 such amendments under paragraph (2)) exceeds

11 $25,000, such excess amount may continue to be

12 treated, in accordance with regulations which the

13 National Credit Union Administration shall pre14 scribe, as insured deposits in the manner provided in

15 section 206(d)(1) of the Federal Credit Union Act

16 during the 1-year period beginning on such effective

17 date.

18 (4) NOTICE.—The National Credit Union Ad19 ministration shall require, by regulation, each in20 sured credit union to provide notice to each

21 accountholder at such credit union before the end of

22 the 60-day period described in paragraph (2) of—

23 (A) the reduction in the amount of deposit

24 insurance available on deposits at the credit

25 union; and
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1 (B) the transition rules prescribed pursu2 ant to paragraph (3).

3 (c) REGULATIONS.—The Board of Directors of the

4 Federal Deposit Insurance Corporation and the National

5 Credit Union Administration Board shall prescribe regula6 tions necessary to carry out this section.

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