IC 

112TH CONGRESS 

2D SESSION S. 3709 

IN THE HOUSE OF REPRESENTATIVES 

DECEMBER 27, 2012 

Referred to the Committee on Financial Services 

AN ACT 

To require a Government Accountability Office examination 

of transactions between large financial institutions and 

the Federal Government, 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, 


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1 SECTION 1. GOVERNMENT ACCOUNTABILITY OFFICE 

2 STUDY OF TRANSACTIONS BETWEEN LARGE 

3 FINANCIAL COMPANIES AND THE FEDERAL 

4 GOVERNMENT. 

5 (a) DEFINITIONS.—For purposes of this Act— 

6 (1) the term ‘‘covered institution’’ means any 

7 bank holding company having more than 

8 $500,000,000,000 in consolidated assets; and 

9 (2) the term ‘‘economic benefit’’ means the dif10 ference between actual loans terms offered, debt or 

11 equity prices, or asset values and a reasonable esti12 mate of what such terms, prices, or values might 

13 have been, as determined by examining actual values 

14 of comparable transaction in the private markets or 

15 by estimating the values of comparable transactions 

16 priced to properly reflect associated risk. 

17 (b) GAO STUDY.—The Comptroller General of the 

18 United States (in this section referred to as the ‘‘Comp19 troller’’) shall conduct a study of covered institutions, such 

20 as— 

21 (1) the favorable pricing of the debt of such in22 stitutions, relative to their risk profile resulting from 

23 the perception that such institutions will receive 

24 Government support in the event of any financial 

25 stress; 


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1 (2) any favorable funding or economic treat2 ment resulting from an increase in the credit rating 

3 for covered institutions, as a result of express, im4 plied, or perceived Government support; 

5 (3) any economic benefit to covered institutions 

6 resulting from the ownership of, or affiliation with, 

7 an insured depository institution; 

8 (4) any economic benefit resulting from the sta9 tus of covered institutions as a bank holding com10 pany, including access to Federal deposit insurance 

11 and the discount window of the Board of Governors 

12 of the Federal Reserve System before the date of en13 actment of this Act; 

14 (5) any economic benefit received through ex15 traordinary Government actions taken, such as— 

16 (A) actions by the Department of the 

17 Treasury— 

18 (i) under the Emergency Economic 

19 Stabilization Act, such as— 

20 (I) asset purchases by the United 

21 States Government; 

22 (II) capital injections from the 

23 United States Government; or 

24 (III) housing programs; or 


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1 (ii) by the purchase of the mortgage 

2 backed securities of the Federal National 

3 Mortgage Association and the Federal 

4 Home Loan Mortgage Corporation (in this 

5 Act referred to as ‘‘government-sponsored 

6 enterprises’’), in order to lower interest 

7 rates, and the value of such securities in 

8 the absence of such purchases; 

9 (B) actions by the Board of Governors of 

10 the Federal Reserve System prior to the date of 

11 enactment of this Act, such as— 

12 (i) providing loans to financial institu13 tions through the Term Auction Facility; 

14 and 

15 (ii) assistance through programs 

16 under section 13(3) of the Federal Reserve 

17 Act prior to the date of enactment of this 

18 Act, such as— 

19 (I) lending through the Commer20 cial Paper Funding Facility; 

21 (II) securities lending to primary 

22 dealers through the Primary Dealer 

23 Credit Facility and the Term Securi24 ties Lending Facility; 


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1 (III) lending to institutions 

2 through the Term Asset-Backed Secu3 rities Loan Facility; or 

4 (IV) purchasing assets through 

5 the Maiden Lane facility; and 

6 (C) actions by the Federal Deposit Insur7 ance Corporation, such as— 

8 (i) guaranteeing debt or deposits 

9 through the Temporary Liquidity Guar10 antee Program; or 

11 (ii) pricing of assessments related to 

12 any such guarantees; and 

13 (6) any extraordinary assistance provided to 

14 American Insurance Group, but ultimately received 

15 by one of the covered institutions; and 

16 (7) any Government actions that resulted in the 

17 payment or nonpayment of credit default swap con18 tracts entered into by a covered institution. 

19 SEC. 2. REPORT TO CONGRESS. 

20 Not later than 1 year after the date of enactment 

21 of this Act, the Comptroller shall submit a report to Con22 gress detailing the findings of the Comptroller in the study 

23 conducted under this Act. Such report shall be made elec24 tronically available to the public, except that any propriVerDate Mar 15 2010 23:56 Dec 27, 2012 Jkt 029200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S3709.RFH S3709

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1 etary, sensitive, or confidential information shall be re2 dacted in any release to the public. 

3 SEC. 3. RULE OF CONSTRUCTION. 

4 Nothing in this Act may be construed to provide au5 thority inconsistent with, or to otherwise affect, section 

6 714 of title 31 United States Code. 

Passed the Senate December 21, 2012. 

Attest: NANCY ERICKSON, 

Secretary. 


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