I 
118TH CONGRESS 
1ST SESSION H. R. 4209 
To prohibit stock sales by senior bank executives in certain circumstances. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 20, 2023 
Ms. WATERS (for herself, Ms. VELA´ZQUEZ, Mr. SHERMAN, Mr. GREEN of 
Texas, Mr. CLEAVER, Mrs. BEATTY, Ms. GARCIA
of Texas, Mr. 
HORSFORD, and Ms. TLAIB) introduced the following bill; which was re-
ferred to the Committee on Financial Services 
A BILL 
To prohibit stock sales by senior bank executives in certain 
circumstances. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Incentivizing Safe and 
Sound Banking Act’’. 
SEC. 2. STOCK SALE PROHIBITION. 
(a) AUTHORITY TO PROHIBIT STOCK SALES RELAT-
ING TO CEASE AND DESIST ORDERS.—Section 8(b) of the 
Federal Deposit Insurance Act (12 U.S.C. 1818(b)) is 
amended by inserting at the end the following: 
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‘‘(11) STOCK SALE PROHIBITION.—The author-
ity to issue an order under this subsection or sub-
section (c) includes the authority to prohibit the sale 
of securities of the insured depository institution and 
any affiliate of such insured depository institution 
received and owned by any current or former officer 
or director of the insured depository institution or 
any institution-affiliated party that received such se-
curities as a form of compensation.’’. 
(b) AUTOMATIC PROHIBITION.—Section 8 of the 
Federal Deposit Insurance Act (12 U.S.C. 1818) is fur-
ther amended by adding at the end the following: 
‘‘(y) AUTOMATIC PROHIBITION OF STOCK SALE.— 
‘‘(1) IN GENERAL.—If a covered banking insti-
tution has a composite or component rating of 3, 4, 
or 5 under the Uniform Financial Institutions Rat-
ing System (or an equivalent rating under a com-
parable rating system), or the appropriate Federal 
banking agency issues a ‘matter requiring immediate 
attention’ (or similar supervisory notice, as deter-
mined by the appropriate Federal banking agency) 
to a covered banking institution, and the institution 
does not remediate the issue by the deadline estab-
lished by the appropriate Federal banking agency, 
any senior executive officer may not sell securities of 
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the covered banking institution or any affiliate of the 
covered banking institution that the individual re-
ceived as a form of compensation, until the matter 
is resolved to the satisfaction of the appropriate 
Federal banking agency. 
‘‘(2) COVERED BANKING INSTITUTION.—In this 
subsection, the term ‘covered banking institution’ 
means— 
‘‘(A) a bank holding company with more 
than $50,000,000,000 in consolidated assets; 
‘‘(B) a bank subsidiary of a bank holding 
company described under subparagraph (A); or 
‘‘(C) a bank or savings association with 
more than $50,000,000,000 in consolidated as-
sets.’’. 
Æ 
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