I
104TH CONGRESS
1ST SESSION
H. R. 1474
To amend the Federal Deposit Insurance Act to improve the requirements
relating to the designated reserve ratio for the deposit insurance funds
and the procedures for funding the reserves in such funds, and for
other purposes.
IN THE HOUSE OF REPRESENTATIVES
APRIL 7, 1995
Mr. LAFALCE introduced the following bill; which was referred to the
Committee on Banking and Financial Services
A BILL
To amend the Federal Deposit Insurance Act to improve
the requirements relating to the designated reserve ratio
for the deposit insurance funds and the procedures for
funding the reserves in such funds, and for other pur-
poses.
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 ‘‘Deposit Insurance
Funds Management Improvement Act of 1995’’.
SEC. 2. DEPOSIT INSURANCE FUND IMPROVEMENTS.
(a) ESTABLISHMENT
OF
DESIGNATED
RESERVE
RATIO AS A FLOOR RATHER THAN A TARGET.—Section
7(b)(2)(A)(iv) of the Federal Deposit Insurance Act (12
U.S.C. 1817(b)(2)(A)(iv)) is amended to read as follows:
‘‘(iv) 
ESTABLISHMENT
OF
DES-
IGNATED RESERVE RATIO.—The Board of
Directors shall establish the designated re-
serve ratio for each insurance fund in ac-
cordance with the following:
‘‘(I) The designated reserve ratio
of any insurance fund shall be not less
than 1.25 percent of the estimated in-
sured deposits of members of such
fund.
‘‘(II) The ratio of any insurance
fund shall be established at an
amount which the Board of Directors
determines will provide for an appro-
priate amount of reserves against
losses which may reasonably be ex-
pected to be incurred by the fund
without resulting in an excessive
buildup in the fund.’’.
(b) REDUCTION
IN ASSESSMENT RATE
IF DES-
IGNATED RESERVE RATIO IS MET.—Section 7(b)(2)(A) of
the 
Federal 
Deposit 
Insurance 
Act 
(12 
U.S.C.
1817(b)(2)(A)) is amended by adding at the end the fol-
lowing new clause:
‘‘(v) CLARIFICATION
OF
AUTHORITY
TO REDUCE ASSESSMENTS AMOUNTS.—The
authority of the Board of Directors to set
semiannual assessments to maintain the
reserve ratio of any insurance fund at the
designated reserve ratio includes the au-
thority to reduce such assessments by any
appropriate amount if the reserve ratio of
such fund is equal to or greater than the
minimum designated reserve ratio of such
fund.’’.
(c) CONSIDERATION OF EFFECT OF ASSESSMENT
RATE DIFFERENTIAL.—Section 7(b)(2)(B) of the Federal
Deposit Insurance Act (12 U.S.C. 1817(b)(2)(B)) is
amended to read as follows:
‘‘(B) CONSIDERATION OF EFFECT OF AS-
SESSMENT
RATE
DIFFERENTIAL.—In setting
the semiannual assessment rates for insured de-
pository institutions, the Board of Directors
may consider any risk to the safety and sound-
ness of any deposit insurance fund, the mem-
bers of any deposit insurance fund, or the de-
posit insurance system as a whole which is
posed by any difference between the assessment
rate for Savings Association Insurance Fund
members and the assessment rate for Bank In-
surance Fund members.’’.
(d) REPEAL
OF
MINIMUM
SAIF ASSESSMENT
RULE.—Section 7(b)(2) of the Federal Deposit Insurance
Act (12 U.S.C. 1817(b)(2)) is amended by striking sub-
paragraph (E).
Æ