(b) UNDERSERVED AREA DEFINED.—Section 101 of 
the Federal Credit Union Act (12 U.S.C. 1752) is amend-
ed by adding at the end the following new paragraph: 
‘‘(10) UNDERSERVED AREA.—The term ‘under-
served area’ means an area consisting of 1 or more 
census tracts that have—
‘‘(A) a poverty rate of 20 percent or great-
er, based on the most recent census data; or 
‘‘(B) a median family income that does not 
exceed 80 percent of the greater of—
‘‘(i) the median family income for the 
metropolitan area in which such census 
tract or tracts are located; or 
‘‘(ii) the median family income for the 
State in which such census tract or tracts 
are located.’’. 
SEC. 113. CREDIT UNION CONVERSION VOTING REQUIRE-
MENTS. 
Section 205(b)(2)(B) of the Federal Credit Union 
Act (12 U.S.C. 1785(b)(2)(B)) is amended by inserting 
‘‘, in a vote in which at least 20 percent of the credit union 
membership participates’’ before the period at the end.
SEC. 114. EXEMPTION FROM PRE-MERGER NOTIFICATION 
REQUIREMENT OF THE CLAYTON ACT. 
Section 7A(c)(7) of the Clayton Act (15 U.S.C. 
18a(c)(7)) is amended by inserting ‘‘section 205(b)(3) of 
the Federal Credit Union Act (12 U.S.C. 1785(b)(3)),’’ 
before ‘‘or section 3’’. 
SEC. 115. TREATMENT OF CREDIT UNIONS AS DEPOSITORY 
INSTITUTIONS UNDER SECURITIES LAWS. 
(a) DEFINITION OF BANK UNDER THE SECURITIES 
EXCHANGE ACT OF 1934.—Section 3(a)(6) of the Securi-
ties Exchange Act of 1934 (15 U.S.C. 78c(a)(6)) (as 
amended by section 201(a)(1) of this Act) is amended—
(1) by striking ‘‘this title, and (D) a receiver’’ 
and inserting ‘‘this title, (D) an insured credit union 
(as defined in section 101(7) of the Federal Credit 
Union Act) but only for purposes of paragraphs (4) 
and (5) of this subsection and only for activities oth-
erwise authorized by applicable laws to which such 
credit unions are subject, and (E) a receiver’’; and 
(2) in subparagraph (E) (as so redesignated by 
paragraph (1) of this subsection) by striking ‘‘(A), 
(B), or (C)’’ and inserting ‘‘(A), (B), (C), or (D)’’. 
(b) DEFINITION OF BANK UNDER THE INVESTMENT 
ADVISERS ACT OF 1940.—Section 202(a)(2) of the In-
vestment Advisers Act of 1940 (15 U.S.C. 80b–2(a)(2))
(as amended by section 201(b)(1) of this Act) is amend-
ed—
(1) by striking ‘‘this title, and (D) a receiver’’ 
and inserting ‘‘this title, (D) an insured credit union 
(as defined in section 101(7) of the Federal Credit 
Union Act) but only for activities otherwise author-
ized by applicable laws to which such credit unions 
are subject, and (E) a receiver’’; and 
(2) in subparagraph (E) (as so redesignated by 
paragraph (1) of this subsection) by striking ‘‘(A), 
(B), or (C)’’ and inserting ‘‘(A), (B), (C), or (D)’’. 
(c) DEFINITION OF APPROPRIATE FEDERAL BANK-
ING AGENCY.—Section 210A(c) of the Investment Advis-
ers Act of 1940 (15 U.S.C. 80b–10a(c)) is amended by 
inserting ‘‘and includes the National Credit Union Admin-
istration Board, in the case of an insured credit union (as 
defined in section 101(7) of the Federal Credit Union 
Act)’’ before the period at the end. 
TITLE II—MEMBER BUSINESS 
LENDING 
SEC. 201. LIMITS ON MEMBER BUSINESS LOANS. 
Section 107A(a) of the Federal Credit Union Act (12 
U.S.C. 1757a(a)) is amended by striking ‘‘the lesser
of—’’ and all that follows and inserting ‘‘20 percent of 
the total assets of the credit union.’’.
SEC. 202. DEFINITION OF MEMBER BUSINESS LOAN. 
Section 107A(c)(1)(B)(iii) of the Federal Credit 
Union Act (12 U.S.C. 1757a(c)(1)(B)(iii)) is amended by 
striking ‘‘$50,000’’ and inserting ‘‘an amount, not to ex-
ceed $100,000, which the Board shall prescribe by regula-
tion’’. 
SEC. 203. RESTRICTION ON MEMBER BUSINESS LOANS. 
Section 216(g)(2) of the Federal Credit Union Act 
(12 U.S.C. 1790d(g)(2)) is amended by striking ‘‘until 
such time as the credit union becomes adequately capital-
ized’’ and inserting ‘‘unless otherwise approved by the 
Board’’. 
TITLE III—CAPITAL LEVELS 
SEC. 301. AMENDMENTS TO NET WORTH CATEGORIES. 
Section 216 of the Federal Credit Union Act (12 
U.S.C. 1790d) is amended—
(1) by striking subsection (o)(3) and inserting 
the following new paragraph: 
‘‘(3) NET WORTH RATIO.—The term ‘net worth 
ratio’ means, with respect to a credit union, the 
ratio of the net worth of the credit union to the risk 
assets of the credit union as defined by the Board.’’; 
(2) by striking subsection (d) and inserting the 
following new subsection 
‘‘(d) [Repealed]’’; and
(3) by striking subparagraph (E) of subsection 
(c)(1) and inserting the following new subparagraph: 
‘‘(E) CRITICALLY
UNDERCAPITALIZED.—
An insured credit union is ‘critically under-
capitalized’ if the credit union has—
‘‘(i) a net worth of less than 2 percent 
of actual assets; or 
‘‘(ii) a net worth ratio of less than a 
minimum net worth ratio prescribed by the 
Board in excess of 2 percent but not more 
than 3 percent.’’.
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