I
106TH CONGRESS
2D SESSION
H. R. 4893
To enhance the availability of capital and credit for all citizens and commu-
nities, to ensure that community reinvestment keeps pace as banks,
securities firms, and other financial service providers become affiliates
as a result of the enactment of the Gramm-Leach-Bliley Act, and for
other purposes.
IN THE HOUSE OF REPRESENTATIVES
JULY 19, 2000
Mr. BARRETT of Wisconsin (for himself, Mr. GUTIERREZ, Mr. COYNE, Ms.
BALDWIN, Ms. CARSON, Mr. FRANK of Massachusetts, Mr. BROWN of
Ohio, Mr. LIPINSKI, Mr. RUSH, Mr. HINCHEY, Mr. DOYLE, Mr. BONIOR,
Mr. BLAGOJEVICH, Mr. OWENS, Mrs. MEEK of Florida, Mr. FILNER, Mr.
DAVIS of Illinois, Ms. JACKSON-LEE of Texas, Ms. MCKINNEY, Mr.
BRADY
of Pennsylvania, Ms. SCHAKOWSKY, Ms. STABENOW, Mr.
CAPUANO, Mr. SANDERS, Mrs. JONES of Ohio, Ms. NORTON, Mr. TOWNS,
and Mr. CONYERS) introduced the following bill; which was referred to
the Committee on Banking and Financial Services, and in addition to the
Committee on Commerce, for a period to be subsequently determined by
the Speaker, in each case for consideration of such provisions as fall with-
in the jurisdiction of the committee concerned
A BILL
To enhance the availability of capital and credit for all citi-
zens and communities, to ensure that community rein-
vestment keeps pace as banks, securities firms, and other
financial service providers become affiliates as a result
of the enactment of the Gramm-Leach-Bliley Act, and
for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Community Reinvestment Modernization Act of 2000’’.
(b) TABLE OF CONTENTS.—The table of contents for
this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Findings.
Sec. 3. Purposes.
TITLE I—MODERNIZATION OF COMMUNITY REINVESTMENT ACT
OF 1977 AND COMMUNITY SERVICE OBLIGATIONS.
Sec. 101. Extension of community reinvestment obligations within a financial
holding company.
Sec. 102. Provisions relating to improved responsiveness of insured depository
institutions to Community Reinvestment Act of 1977.
Sec. 103. Reduction of CRA rating due to predatory lending and other negative
credit practices.
Sec. 104. Responsiveness to community needs for securities and investment
services.
Sec. 105. Responsiveness to community needs for mortgages and mortgage re-
lated services by mortgage banks.
Sec. 106. Responsiveness to community needs for insurance services.
Sec. 107. Satisfactory ratings required by securities company, mortgage bank,
and insurance company affiliates of financial holding compa-
nies.
TITLE II—DATA DISCLOSURE REQUIREMENTS
Subtitle A—Disclosure of Insurance Availability and Insurer Investment
Information
Sec. 201. Short title.
Sec. 202. Establishment of general requirements to submit information.
Sec. 203. Reporting of noncommercial insurance information.
Sec. 204. Reporting of rural insurance information.
Sec. 205. Waiver of reporting requirements.
Sec. 206. Reporting by private mortgage insurers.
Sec. 207. Reporting of information regarding investments by insurers.
Sec. 208. Submission of information to Secretary and maintenance of informa-
tion.
Sec. 209. Availability and access system.
Sec. 210. Designations.
Sec. 211. Enforcement.
Sec. 212. Exemption and relation to State laws.
Sec. 213. Regulations.
Sec. 214. Definitions.
Sec. 215. Effective date.
Subtitle B—Improvements in Other Data Disclosure Requirements
Sec. 221. Improve small business and agriculture lending data disclosure.
Sec. 222. Maintenance and disclosure of information by the Financial Institu-
tions Examination Counsel.
TITLE III—REGULATORY AND STRUCTURAL REFORMS
Sec. 301. Antiredlining requirement for financial holding companies.
Sec. 302. Notice and public comment required before establishing a financial
holding company.
Sec. 303. Public meetings for bank acquisitions and mergers.
Sec. 304. CRA examination schedule for small banks.
Sec. 305. CRA sunshine requirements.
Sec. 306. Continuing community reinvestment requirement for financial holding
companies.
Sec. 307. Changes in reporting requirements under the Home Mortgage Disclo-
sure Act of 1975.
SEC. 2. FINDINGS.
The Congress hereby finds as follows:
(1) It is necessary to increase homeownership
and small business ownership for low- and moderate-
income borrowers and persons of color.
(2) The United States has an overall home-
ownership rate of 66.7 percent, while Hispanic and
African-American homeownership rates are 46.2 per-
cent and 46.9 percent respectively.
(3) The homeownership rate in central cities is
50.3 percent, compared to 73.5 percent for the sub-
urbs.
(4) It is necessary to close the wealth gap in
the United States and to increase access to insur-
ance products.
(5) In 1998, the median net worth for His-
panic, African-American, Asian, and other minority
families was $16,400, which was 17.3 percent of the
median net worth of $94,900 for nonhispanic white
families.
(6) Families earning $10,000 to $25,000 had a
median net worth of $24,800 in 1998 but $31,000
in 1995.
(7) Research conducted by the chief economist
of the National Association of Insurance Commis-
sioners found that after controlling for risk of loss,
a 10 percentage point increase in the number of mi-
norities in a zip code is associated with a 2 percent-
age point increase in the number of ‘‘FAIR plans’’,
which are government-sponsored insurance plans of
last resort for those who cannot obtain insurance in
the private market.
(8) In order to increase access to credit, wealth
and insurance, it is necessary to modernize the Com-
munity Reinvestment Act of 1977 to reflect shifting
trends in the financial services industry.
(9) Currently, about 40 percent of the assets in
the financial industry reside in bank and thrifts and
are covered by the Community Reinvestment Act of
1977, down from about 60 percent in the early
1980s.
SEC. 3. PURPOSES.
The purposes of this Act are as follows:
(1) To enhance the availability of financial serv-
ices to citizens of all economic circumstances and in
all geographic areas.
(2) To enhance the ability of financial institu-
tions to meet the capital and credit needs of all citi-
zens and communities, including underserved com-
munities and populations.
(3) To ensure that community reinvestment
keeps pace with the affiliation of banks, securities
firms, and other financial service providers, as pro-
vided by the Gramm-Leach-Bliley Act.
TITLE 
I—MODERNIZATION 
OF
COMMUNITY REINVESTMENT
ACT OF 1977 AND COMMUNITY
SERVICE OBLIGATIONS.
SEC. 101. EXTENSION OF COMMUNITY REINVESTMENT OB-
LIGATIONS WITHIN A FINANCIAL HOLDING
COMPANY.
Section 4(l) of the Bank Holding Company Act of
1956 (12 U.S.C. 1843(l)) is amended by adding at the
end the following new paragraph:
‘‘(4) COMMUNITY NEEDS.—
‘‘(A) IN GENERAL.—All nonbank affiliates
of bank holding companies that engage in lend-
ing or offer banking products or services shall
be subject to the Community Reinvestment Act
of 1977 in accordance with this paragraph and
in the same manner as a regulated financial in-
stitution (as defined in such Act) and the
record of any such affiliate in meeting commu-
nity credit, investment, and consumer needs
shall be taken into account by the Federal regu-
latory agency with jurisdiction over the affili-
ate’s bank holding company in the course of re-
viewing the activities of the bank holding com-
pany or any application by such affiliate.
‘‘(B) BANKING PRODUCTS AND SERVICES
DEFINED.—For purposes of this paragraph, the
term ‘banking products and services’ includes—
‘‘(i) insured deposits (as defined in
section 3 of the Federal Deposit Insurance
Act) and related deposit services;
‘‘(ii) consumer loans and extensions of
credit and the servicing such loans and ex-
tensions of credit;
‘‘(iii) loans to purchase, refinance,
construct, improve, or repair domestic resi-
dential housing or manufactured housing,
including single-family and multifamily
residential housing loans and home-equity
loans, and the servicing of such loans;
‘‘(iv) small business and commercial
loans and the servicing of such loans; and
‘‘(v) checking accounts, savings ac-
counts, and related accounts or instru-
ments, including accounts from which the
owner may make withdrawals by negotiable
or transferable instruments for the purpose
of making payments to third parties.’’.
SEC. 102. PROVISIONS RELATING TO IMPROVED RESPON-
SIVENESS OF INSURED DEPOSITORY INSTITU-
TIONS TO COMMUNITY REINVESTMENT ACT
OF 1977.
(a) RATING REQUIRED FOR EACH STATE, METRO-
POLITAN AREA, AND SERVICE AREA.—Section 807(b)(1)
of the Community Reinvestment Act of 1977 (12 U.S.C.
2906(b)(1)) is amended by striking subparagraph (B) and
inserting the following new subparagraphs to read as fol-
lows:
‘‘(B) INITIAL SEPARATE EVALUATION AND
RATING
FOR
STATE, METROPOLITAN, OTHER
SERVICE
AREAS
REQUIRED.—The information
required by clauses (i) and (ii) of subparagraph
(A) with respect to any regulated financial in-
stitution shall be presented separately, and an
initial rating shall be determined separately,
for—
‘‘(i) each metropolitan area in which
the regulated financial institution main-
tains 1 or more domestic branches;
‘‘(ii) each State in which the regulated
financial institution maintains 1 or more
domestic branches outside of a metropoli-
tan area; and
‘‘(iii) each community in which the
regulated financial institution makes more
than 0.5 percent of the total amount of
loans.
‘‘(C) CONTENT
OF
SEPARATE
EVALUA-
TION.—A written evaluation to which subpara-
graph (B) applies shall describe how the Fed-
eral financial supervisory agency has performed
the examination of the regulated financial insti-
tution, including a list of the individual domes-
tic branches examined.
‘‘(D) LOW AND HIGH SATISFACTORY RAT-
INGS.—In assigning ratings under subpara-
graphs (A) and (B), a Federal financial super-
visory agency may assign a rating of ‘low satis-
factory record of meeting community credit
needs’ or ‘high satisfactory record of meeting
community credit needs’ in lieu of the rating re-
ferred to in paragraph (2)(B).’’.
(b) ADDITIONAL PERFORMANCE FACTORS.—Section
804(a)(1) of the Community Reinvestment Act of 1977
(12 U.S.C. 2903(a)(1)) is amended—
(1) by inserting ‘‘and neighborhoods of different
racial characteristics’’ after ‘‘low- and moderate-in-
come neighborhoods’’; and
(2) By inserting ‘‘, taking into account the in-
stitution’s share of the total amount of credit ex-
tended in neighborhoods of different racial and in-
come characteristics within such community’’ before
the semicolon at the end.
(c) TECHNICAL AND CONFORMING AMENDMENTS.—
(1) Section 807(b)(1)(A)(iii) of the Community
Reinvestment 
Act 
of 
1977 
(12 
U.S.C.
2906(b)(1)(A)(iii)) is amended—
(A) by inserting ‘‘overall’’ after ‘‘the insti-
tution’s’’; and
(B) by inserting ‘‘, taking into account
each of the initial ratings determined under
subparagraph (B) for each State, metropolitan,
and service area in which the institution makes
more than 0.5 percent of the total amount of
loans’’ before the period at the end.
(2) Section 807 of the Community Reinvest-
ment Act of 1977 (12 U.S.C. 2906) is amended—
(A) by striking subsection (d); and
(B) by redesignating subsection (e) as sub-
section (d).
SEC. 103. REDUCTION OF CRA RATING DUE TO PREDATORY
LENDING AND OTHER NEGATIVE CREDIT
PRACTICES.
(a) IN GENERAL.—Section 804 of the Community
Reinvestment Act of 1977 (12 U.S.C. 2903) is amended
by adding at the end the following new subsections:
‘‘(d) TREATMENT
OF PREDATORY LENDING
AND
OTHER DISCRIMINATORY CREDIT PRACTICES.—In the
case of a regulated financial institution, or affiliate of any
such institution, which the appropriate Federal financial
supervisory agency determines has engaged in any credit
practice which has a negative impact on a community or
neighborhood, such as predatory lending, or has engaged
in any other lending practice or service in a manner which
unlawfully discriminates against any person or against
low- and moderate-income neighborhoods, the agency—
‘‘(1) may not take any such practice or service
into account in assessing the institution’s record of
meeting the credit needs of its entire community;
and
‘‘(2) shall reduce the rating that would other-
wise obtain under section 807 with respect to such
institution after consideration of the extent of such
negative or discriminatory practice or service.
‘‘(e) MAINTENANCE
OF CERTAIN RECORDS.—For
purposes of determining whether a regulated financial in-
stitution engages in any practice or service described in
subsection (d), an appropriate Federal financial super-
visory agency may require, by regulation, regulated finan-
cial institutions to maintain records of the terms and con-
ditions of credit extended by the institution or the terms
and conditions at which credit was offered even though
no credit was extended.’’.
SEC. 104. RESPONSIVENESS TO COMMUNITY NEEDS FOR
SECURITIES AND INVESTMENT SERVICES.
(a) AFFIRMATIVE OBLIGATION.—The purpose of this
section is to recognize that each securities company has,
with respect to each community comprising an assessment
area of such company, a continuing and affirmative obliga-
tion to meet the need for financial services in such commu-
nities, including the needs of low- and moderate-income
neighborhoods and persons of modest means.
(b) DEFINITIONS.—For purposes of this section, the
following definitions shall apply:
(1) ASSESSMENT AREA.—The term ‘‘assessment
area’’ means, with respect to a securities company,
each community in which such company—
(A) maintains a retail office or is rep-
resented by an agent; or
(B) has not less than 0.5 percent of the
total market in securities.
(2) 
COMMUNITY
DEVELOPMENT
INVEST-
MENT.—The term ‘‘community development invest-
ment’’ means investment in activities that revitalize
and stabilize low- and moderate-income neighbor-
hoods and directly benefit low- and moderate-income
individuals, including investment in affordable hous-
ing, community services, small-business development,
and economic development.
(3) SECURITIES COMPANY.—The term ‘‘securi-
ties company’’ means any person who is—
(A) a broker or dealer that is registered
under the Securities Exchange Act of 1934;
(B) a registered investment adviser, prop-
erly registered by or on behalf of either the Se-
curities and Exchange Commission, with re-
spect to the investment advisory activities of
such investment adviser and activities incidental
to such investment advisory activities; or
(C) an investment company that is reg-
istered under the Investment Company Act of
1940.
(c) PROGRAM.—
(1) IN
GENERAL.—The Securities and Ex-
change Commission, in consultation with the Sec-
retary of the Treasury, shall develop a program to
ensure that securities companies meet the obliga-
tions described in subsection (a) and the require-
ments of the program under this subsection.
(2) FACTORS TO BE INCLUDED.—
(A) CUSTOMER
EVALUATION.—The pro-
gram shall include, as appropriate, a method
for evaluating a securities company’s record of
helping to meet the securities investment needs
of its assessment area, including—
(i) the number and distribution of
customers throughout the community, in-
cluding low- and moderate-income neigh-
borhoods and the dollar amounts of the in-
vestments made by such customers; and
(ii) the extent to which the company
has adopted innovative and flexible mar-
keting methods, such as low minimum
amounts to open accounts and low trans-
action fees, that facilitate the sale of secu-
rities to low- and moderate-income cus-
tomers.
(B) COMMUNITY
DEVELOPMENT
INVEST-
MENTS.—The program shall include, as appro-
priate, a method for evaluating a securities
company’s record of community development in-
vestment in each assessment area, including—
(i) the number and dollar amount of
community development investments in the
assessment area; and
(ii) the responsiveness of the securi-
ties company, through community develop-
ment investments, to the credit, capital,
and community development needs of the
assessment area, including low- and mod-
erate-income neighborhoods.
(C) PERFORMANCE.—The program shall
include, as appropriate, a method for evaluating
a securities company’s record of providing ac-
cess to securities services in each assessment
area, including—
(i) the company’s record of opening or
closing retail offices in the assessment
area;
(ii) the extent to which the securities
company has adopted effective alternate
marketing systems in low- and moderate-
income neighborhoods, such as providing
the means for low- and moderate-income
individuals to gain electronic access to the
company at community centers and similar
locations in low- and moderate-income
neighborhoods; and
(iii) the extent to which the securities
company has provided investment edu-
cation and other investment services, such
as financial counseling classes, in low- and
moderate-income neighborhoods in the as-
sessment area.
(3) RATING.—
(A) IN GENERAL.—The program shall pro-
vide for—
(i) an evaluation and an initial rating
of the performance of each securities com-
pany in meeting the obligation established
under subsection (a) in each assessment
area of the company; and
(ii) an overall rating, based on the ini-
tial ratings pursuant to clause (i) of the
overall achievement of the securities com-
pany in meeting such obligation.
(B) TREATMENT
OF
INVESTMENT
PRAC-
TICES WITH NEGATIVE IMPACTS.—In the case
of any securities company which the Securities
and Exchange Commission determines has en-
gaged in securities and investment practices
which have a negative impact on any assess-
ment area of the company or has otherwise en-
gaged in any practice or provided any service in
a 
manner 
which 
unlawfully 
discriminates
against any person or against low- and mod-
erate-income neighborhoods, the Commission—
(i) may not take any such practice
into account in assessing the extent to
which such company has met its obligation
under subsection (a); and
(ii) shall reduce the rating that would
otherwise obtain under subparagraph (A)
with respect to such company, after consid-
ering the extent of such negative or dis-
criminatory practice or service.’’.
(C) 
MAINTENANCE
OF
CERTAIN
RECORDS.—For purposes of determining wheth-
er a securities company engages in any practice
or service described in subparagraph (B), the
Securities and Exchange Commission may re-
quire, by regulation, securities companies to
maintain records of the terms and conditions at
which securities products and services were pro-
vided by the company and the terms and condi-
tions at which such securities products or serv-
ices were offered by the company even though
no transaction occurred.
(4) CONSIDERATION OF SECURITIES COMPANY
RATING.—Whenever the Commission considers an
application to the Commission by a securities com-
pany, the Securities and Exchange Commission
shall—
(A) take into account the overall rating of
the securities company under this subsection;
(B) provide opportunity for comment on
such rating; and
(C) take into account changes in the com-
munity reinvestment performance of such com-
pany since the last overall rating and the likely
future community reinvestment performance of
such company.
(d) RELEASE OF DATA.—Information collected by
the Securities and Exchange Commission in connection
with the program under subsection (c) shall be made pub-
licly available by the Commission in a format similar to
the format for public disclosure of information under the
Home Mortgage Disclosure Act of 1975, as determined
to be appropriate by the Commission.
SEC. 105. RESPONSIVENESS TO COMMUNITY NEEDS FOR
MORTGAGES 
AND 
MORTGAGE 
RELATED
SERVICES BY MORTGAGE BANKS.
(a) AFFIRMATIVE
OBLIGATION.—Each mortgage
bank shall have, with respect to each community com-
prising an assessment area of such mortgage bank, a con-
tinuing and affirmative obligation to meet the mortgage
credit and mortgage service needs of such communities,
including extensions of credit in low- and moderate-income
neighborhoods of such communities.
(b) DEFINITIONS.—For purposes of this section, the
following definitions shall apply:
(1) ASSESSMENT AREA.—The term ‘‘assessment
area’’ means, with respect to a mortgage bank, each
community in which such company—
(A) maintains a retail office or is rep-
resented by an agent; or
(B) has not less than 0.5 percent of the
total market in housing-related loans.
(2) 
COMMUNITY
DEVELOPMENT
INVEST-
MENT.—The term ‘‘community development invest-
ment’’ means investment in activities that revitalize
and stabilize low- and moderate-income neighbor-
hoods and directly benefit low- and moderate-income
individuals, including investment in affordable hous-
ing, community services, small-business development,
and economic development.
(3) MORTGAGE BANK.—The term ‘‘mortgage
bank’’ means any lender who does not accept depos-
its (as defined in section 3 of the Federal Deposit
Insurance Act) and originates housing-related loans.
(4) SECRETARY.—The term ‘‘Secretary’’ means
the Secretary of Housing and Urban Development.
(c) PROGRAM.—
(1) IN GENERAL.—The Secretary, in consulta-
tion with the Secretary of the Treasury, shall de-
velop a program to ensure that mortgage banks
meet the obligations described in subsection (a) and
the requirements of the program under this sub-
section.
(2) FACTORS TO BE INCLUDED.—
(A) CUSTOMER
EVALUATION.—The pro-
gram shall include, as appropriate, a method
for evaluating a mortgage bank’s record of
helping to meet the mortgage credit and mort-
gage service needs of its assessment area,
including—
(i) the number and distribution of
customers throughout the community, in-
cluding low- and moderate-income neigh-
borhoods and the dollar amounts of the
mortgage credit extended to such cus-
tomers by the mortgage bank; and
(ii) the extent to which the mortgage
bank has adopted innovative and flexible
marketing methods that facilitate the ex-
tension of mortgage credit on a non-
discriminatory basis to low- and moderate-
income customers.
(B) COMMUNITY
DEVELOPMENT
INVEST-
MENTS.—The program shall include, as appro-
priate, a method for evaluating a mortgage
bank’s record of community development invest-
ment in each assessment area, including—
(i) the number and dollar amount of
community development investments in the
assessment area; and
(ii) the responsiveness of the mort-
gage bank, through community develop-
ment investments, to the credit, capital,
and community development needs of the
assessment area, including low- and mod-
erate-income neighborhoods.
(C) PERFORMANCE.—The program shall
include, as appropriate, a method for evaluating
a mortgage bank’s record of providing access to
mortgage credit and mortgage services in each
assessment area, including—
(i) the bank’s record of opening or
closing retail offices in the assessment
area;
(ii) the extent to which the mortgage
bank has adopted effective alternate mar-
keting systems in low- and moderate-in-
come neighborhoods, such as providing the
means for low- and moderate-income indi-
viduals to gain electronic access to the
mortgage bank at community centers and
similar locations in low- and moderate-in-
come neighborhoods;
(iii) the extent to which the mortgage
bank has provided home purchaser and
home owner education and other coun-
seling services, such as financial counseling
classes, in low- and moderate-income
neighborhoods in the assessment area.
(iv) the mortgage bank’s market share
in neighborhoods of different racial and in-
come characteristics;
(v) the number of applications re-
ceived from and loans made to minorities
and low- and moderate-income persons;
(vi) a comparison of the rate at which
the mortgage bank rejects applications
from minority and white applicants; and
(vii) any evidence of illegal discrimina-
tory 
credit 
practices, 
including
prescreening, or offering less favorable
loan products to applicants of different ra-
cial backgrounds.
(3) RATING.—
(A) IN GENERAL.—The program shall pro-
vide for—
(i) an evaluation and an initial rating
of the performance of each mortgage bank
in meeting the obligation established under
subsection (a) in each assessment area of
the bank; and
(ii) an overall rating, based on the ini-
tial ratings pursuant to clause (i) of the
overall achievement of the mortgage bank
in meeting such obligation.
(B) TREATMENT
OF
CREDIT
PRACTICES
WITH NEGATIVE IMPACTS.—In the case of any
mortgage bank which the Secretary determines
has engaged in credit practices which have a
negative impact on any individuals or any as-
sessment area of the company, such as
prescreening or predatory mortgage lending, or
has otherwise engaged in any practice or pro-
vided any service in a manner which unlawfully
discriminates against any person or against
low- and moderate-income neighborhoods, the
Commission—
(i) may not take any such practice
into account in assessing the extent to
which such company has met its obligation
under subsection (a); and
(ii) shall reduce the rating that would
otherwise obtain under subparagraph (A)
with respect to such company, after consid-
ering the extent of such negative or dis-
criminatory practice or service.
(C) 
MAINTENANCE
OF
CERTAIN
RECORDS.—For purposes of determining wheth-
er a mortgage bank engages in any practice or
service described in subparagraph (B), the Sec-
retary may require, by regulation, mortgage
banks to maintain records of the terms and
conditions at which mortgage loans and other
services were provided by the company and the
terms and conditions at which such mortgage
loans and other products and services were of-
fered by the bank even though no transaction
occurred.
(d) CONSIDERATION OF MORTGAGE BANK’S RAT-
ING.—
(1) REVIEW OF RATING.—On an annual basis
or at such shorter time-period as the Secretary may
determine to be appropriate, the Secretary shall—
(A) review the overall rating of each mort-
gage bank under this subsection;
(B) provide opportunity for comment on
such rating; and
(C) review changes in the community rein-
vestment performance of such mortgage bank
since the last overall rating and the likely fu-
ture community reinvestment performance of
such mortgage bank.
(2) NOTIFICATION
OF
UNSATISFACTORY
PER-
FORMANCE.—If, in conjunction with a review pursu-
ant to paragraph (1), the Secretary determines that
a mortgage bank has failed to meet the bank’s obli-
gations described in subsection (a) and the require-
ments of the program under this subsection or failed
to make satisfactory improvements in meeting such
obligations and requirements, the Secretary shall no-
tify the mortgage bank of such determination, de-
scribing the conditions giving rise to the notice.
(3) AGREEMENT TO CORRECT CONDITIONS RE-
QUIRED.—Not later than 45 days after the date of
receipt by a mortgage bank of a notice given under
paragraph (2) (or such additional period as the Sec-
retary may permit), the mortgage bank shall execute
an agreement with the Secretary to comply with the
obligations and requirements applicable to the mort-
gage bank under this section.
(4) SECRETARY
MAY
IMPOSE
LIMITATIONS.—
Until the conditions described in a notice to a mort-
gage bank under paragraph (2) are corrected, the
Secretary may impose such limitations on the extent
to which mortgage loans originated, held, or serviced
by such mortgage bank may be acquired by the Fed-
eral Home Mortgage Corporation or the Federal Na-
tional Mortgage Association as the Secretary deter-
mines to be appropriate under the circumstances
and consistent with the purposes of this section.
(5) FAILURE TO CORRECT.—If the conditions
described in a notice to a mortgage bank under
paragraph (2) are not corrected within 180 days
after the date of receipt by the mortgage bank of a
notice under paragraph (2), the Secretary shall pro-
hibit the Federal Home Mortgage Corporation and
the Federal National Mortgage Association from ac-
quiring any mortgage loan originated, held, or serv-
iced by such mortgage bank.
(6) CONSULTATION.—In taking any action
under this subsection, the Secretary shall consult
with all relevant Federal and State regulatory agen-
cies and authorities.
SEC. 106. RESPONSIVENESS TO COMMUNITY NEEDS FOR IN-
SURANCE SERVICES.
(a) AFFIRMATIVE OBLIGATION.—The purpose of this
section is to recognize that each insurance company has,
with respect to each community comprising an assessment
area of such company, a continuing and affirmative obliga-
tion to meet the need for insurance services in such com-
munities, including the needs of low- and moderate-income
neighborhoods and persons of modest means.
(b) DEFINITIONS.—For purposes of this section, the
following definitions shall apply:
(1) ASSESSMENT AREA.—The term ‘‘assessment
area’’ means, with respect to an insurance company,
each community in which such company—
(A) maintains a retail office or is rep-
resented by an agent; or
(B) has not less than 0.5 percent of the
total market in insurance.
(2) 
COMMUNITY
DEVELOPMENT
INVEST-
MENT.—The term ‘‘community development invest-
ment’’ means investment in activities that revitalize
and stabilize low- and moderate-income neighbor-
hoods and directly benefit low- and moderate-income
individuals, including investment in affordable hous-
ing, community services, small-business development,
and economic development.
(3) INSURANCE COMPANY.—The term ‘‘insur-
ance company’’ includes any person engaged in the
business of insurance to the extent of such activities.
(4) SECRETARY.—The term ‘‘Secretary’’ means
the Secretary of Housing and Urban Development.
(c) PROGRAM.—
(1) IN GENERAL.—The Secretary, in consulta-
tion with the Secretary of the Treasury, shall de-
velop a program to ensure that insurance companies
meet the obligations described in subsection (a) and
the requirements of the program under this sub-
section.
(2) FACTORS TO BE INCLUDED.—
(A) CUSTOMER
EVALUATION.—The pro-
gram shall include, as appropriate, a method
for evaluating an insurance company’s record of
helping to meet the insurance needs of its as-
sessment area, including—
(i) the number and distribution of
customers throughout the community, in-
cluding low- and moderate-income neigh-
borhoods and the dollar amounts of the in-
surance policies held by such customers;
and
(ii) the extent to which the company
has adopted innovative and flexible mar-
keting methods that facilitate the sale of
insurance on a nondiscriminatory basis to
low- and moderate-income customers.
(B) COMMUNITY
DEVELOPMENT
INVEST-
MENTS.—The program shall include, as appro-
priate, a method for evaluating an insurance
company’s record of community development in-
vestment in each assessment area, including—
(i) the number and dollar amount of
community development investments in the
assessment area; and
(ii) the responsiveness of the insur-
ance company, through community devel-
opment investments, to the credit, capital,
and community development needs of the
assessment area, including low- and mod-
erate-income neighborhoods.
(C) PERFORMANCE.—The program shall
include, as appropriate, a method for evaluating
an insurance company’s record of providing ac-
cess to insurance services in each assessment
area, including—
(i) the company’s record of opening or
closing retail offices or affiliating with
agents in the assessment area;
(ii) the extent to which the insurance
company has adopted effective alternate
marketing systems in low- and moderate-
income neighborhoods, such as providing
the means for low- and moderate-income
individuals to gain electronic access to the
company at community centers and similar
locations in low- and moderate-income
neighborhoods; and
(iii) the extent to which the insurance
company has provided insurance education
and other insurance services, such as fi-
nancial counseling classes, in low- and
moderate-income neighborhoods in the as-
sessment area.
(3) RATING.—The program shall provide for—
(i) an evaluation and an initial rating
of the performance of each insurance com-
pany in meeting the obligation established
under subsection (a) in each assessment
area of the company; and
(ii) an overall rating, based on the ini-
tial ratings pursuant to clause (i) of the
overall achievement of the insurance com-
pany in meeting such obligation.
(B) TREATMENT
OF
INSURANCE
PRAC-
TICES WITH NEGATIVE IMPACTS.—In the case
of any insurance company which the Secretary
determines has engaged in practices which have
a negative impact on any assessment area of
the company or has otherwise engaged in any
practice or provided any service in a manner
which unlawfully discriminates against any per-
son or against low- and moderate-income neigh-
borhoods, the Commission—
(i) may not take any such practice
into account in assessing the extent to
which such company has met its obligation
under subsection (a); and
(ii) shall reduce the rating that would
otherwise obtain under subparagraph (A)
with respect to such company after consid-
eration of the extent of such negative or
discriminatory practice or service.
(C) 
MAINTENANCE
OF
CERTAIN
RECORDS.—For purposes of determining wheth-
er an insurance company engages in any prac-
tice or service described in subparagraph (B),
the Secretary may require, by regulation, insur-
ance companies to maintain records of the
terms and conditions at which insurance prod-
ucts and services were provided by the company
and the terms and conditions at which such in-
surance products or services were offered by the
company even though no transaction occurred.
(d) CONSIDERATION
OF
INSURANCE
COMPANY’S
RATING.—
(1) REVIEW OF RATING.—On an annual basis
or at such shorter time-period as the Secretary may
determine to be appropriate, the Secretary shall—
(A) review the overall rating of each insur-
ance company under this subsection;
(B) provide opportunity for comment on
such rating; and
(C) review changes in the community rein-
vestment performance of such insurance com-
pany since the last overall rating and the likely
future community reinvestment performance of
such insurance company.
(2) NOTIFICATION
OF
UNSATISFACTORY
PER-
FORMANCE.—If, in conjunction with a review pursu-
ant to paragraph (1), the Secretary determines that
an insurance company has failed to meet the com-
pany’s obligations described in subsection (a) and
the requirements of the program under this sub-
section or failed to make satisfactory improvements
in meeting such obligations and requirements, the
Secretary shall notify the insurance company and
each appropriate State insurance regulator of such
determination, describing the conditions giving rise
to the notice.
(3) AGREEMENT TO CORRECT CONDITIONS RE-
QUIRED.—Not later than 45 days after the date of
receipt by an insurance company of a notice given
under paragraph (2) (or such additional period as
the Secretary may permit), the insurance company
shall execute an agreement with the Secretary to
comply with the obligations and requirements appli-
cable to the insurance company under this section.
(A) information required under subpara-
graphs (A), (B), and (D) of paragraph (1) and
information required pursuant to paragraph
(2), for risks insured under such line that are
located within each census tract any part of
which is located in a State for which the insurer
is offering the designated line; and
(B) information required under paragraph
(1)(C) for agents within such census tracts.
SEC. 204. REPORTING OF RURAL INSURANCE INFORMA-
TION.
(a) IN GENERAL.—The Secretary shall, by regula-
tion, establish requirements for insurers to annually com-
pile and submit to the Secretary information concerning
the availability, affordability, and quality or type of insur-
ance in rural areas and to small businesses.
(b) CONTENT.—The regulations under this section
shall provide that the information compiled and submitted
under this section shall be compiled and submitted on the
basis of each census tract in which the insured risks are
located.
SEC. 205. WAIVER OF REPORTING REQUIREMENTS.
(a) WAIVER FOR STATES COLLECTING EQUIVALENT
INFORMATION.—