ment credits under this paragraph and the
amounts of any such credits, the Board of
Directors shall take into account the factors
for designating the reserve ratio under sub-
section (b)(3) and the factors for setting as-
sessments under subsection (b)(2)(B).
‘‘(vi) LIMITATION
ON
AMOUNT
OF
CREDIT FOR CERTAIN DEPOSITORY INSTITU-
TIONS.—In the case of an insured deposi-
tory institution that exhibits financial,
operational, or compliance weaknesses rang-
ing from moderately severe to unsatisfac-
tory, or is not adequately capitalized (as de-
fined in section 38) at the beginning of an
assessment period, the amount of any credit
allowed under this paragraph against the
assessment on that depository institution
for such period may not exceed the amount
equal to the average assessment on all in-
sured depository institutions for such assess-
ment period.
‘‘(vii) ADMINISTRATIVE REVIEW.—
‘‘(I) IN
GENERAL.—The regula-
tions prescribed under clause (i) shall
include provisions allowing an eligible
insured depository institution a rea-
sonable opportunity for a hearing be-
fore the Corporation to challenge the
amount of the credit determined under
this paragraph for such institution.
‘‘(II) FINALITY
OF
ADMINISTRA-
TIVE REVIEW.—Any review under sub-
clause (i) of any determination of the
Corporation under this paragraph
shall be final and not subject to judi-
cial review.
‘‘(viii) PREDECESSOR
DEFINED.—For
purposes of this paragraph, the term ‘prede-
cessor’, when used with respect to any in-
sured depository institution, includes any
other insured depository institution ac-
quired by or merged with such insured de-
pository institution.
‘‘(B) ON-GOING CREDIT POOL.—
‘‘(i) IN GENERAL.—In addition to the
credit provided pursuant to subparagraph
(A) and subject to the limitation contained
in clause (vi) of such subparagraph, the
Corporation shall, by regulation, establish
an on-going system of credits to be applied
against future assessments under subsection
(b)(1) on the same basis as the dividends
provided under paragraph (2)(C).
‘‘(ii) LIMITATION ON CREDITS UNDER
CERTAIN CIRCUMSTANCES.—No credits may
be allowed by the Corporation under this
subparagraph 
during 
any 
period 
in
which—
‘‘(I) the reserve ratio of the De-
posit Insurance Fund is less than the
designated reserve ratio of such Fund;
or
‘‘(II) the designated reserve ratio
of the Fund is less than 1.25 percent of
the amount of estimated insured depos-
its.’’.
(b) DEFINITION OF RESERVE RATIO.—Section 3(y) of
the Federal Deposit Insurance Act (12 U.S.C. 1813(y)) (as
amended by section 6(b) of this Act) is amended by adding
at the end the following new paragraph:
‘‘(3) RESERVE RATIO.—The term ‘reserve ratio’,
when used with regard to the Deposit Insurance Fund
other than in connection with a reference to the des-
ignated reserve ratio, means the ratio of the net worth
of the Deposit Insurance Fund to the value of the ag-
gregate estimated insured deposits.’’.
SEC. 9. DEPOSIT INSURANCE FUND RESTORATION PLANS.
Section 7(b)(3) of the Federal Deposit Insurance Act
(12 U.S.C. 1917(b)(3)) (as amended by section 6(a) of this
Act) is amended by adding at the end the following new
subparagraph:
‘‘(E) DIF RESTORATION PLANS.—
‘‘(i) IN GENERAL.—Whenever—
‘‘(I) the Corporation projects that
the reserve ratio of the Deposit Insur-
ance Fund will fall below the des-
ignated reserve ratio within 6 months
of such determination; or
‘‘(II) the reserve ratio of the De-
posit Insurance Fund actually falls
below the designated reserve ratio with-
out any determination under subclause
(I) having been made,
the Corporation shall establish and imple-
ment a Deposit Insurance Fund restoration
plan within 30 days that meets the require-
ments of clause (ii) or (iii), as the case may
be, and such other conditions as the Cor-
poration determines to be appropriate.
‘‘(ii) REQUIREMENTS OF PLAN IF RE-
SERVE RATIO DOES NOT FALL BELOW 1.0
PERCENT.—If the reserve ratio of the De-
posit Insurance Fund is not projected to or
has not fallen below an amount equal to 1.0
percent of the aggregate estimated insured
deposits, a Deposit Insurance Fund restora-
tion plan meets the requirements of this
clause if the plan provides that the reserve
ratio of the Fund will meet or exceed the
designated reserve ratio that was in effect
before the occurrence of the event described
in subclause (I) or (II) of clause (i) before
the end of the 3-year period beginning upon
implementation of the plan.
‘‘(iii) REQUIREMENTS OF PLAN IF RE-
SERVE RATIO FALLS BELOW 1.0 PERCENT.—
If the reserve ratio of the Deposit Insurance
Fund has fallen below an amount equal to
1.0 percent of the aggregate estimated in-
sured deposits, a Deposit Insurance Fund
restoration plan meets the requirements of
this clause if the plan provides that the re-
serve ratio of the Fund—
‘‘(I) will meet or exceed an
amount equal to 1.0 percent of the ag-
gregate estimated insured deposits be-
fore the end of the 2-year period begin-
ning upon implementation of the plan;
and
‘‘(II) will meet or exceed the des-
ignated reserve ratio that was in effect
before the occurrence of the event de-
scribed in subclause (I) or (II) of
clause (i) before the end of the 3-year
period beginning on the date the re-
serve ratio first meets or exceeds an
amount equal to 1.0 percent of the ag-
gregate estimated insured deposits after
the implementation of the plan.
‘‘(iv) TRANSPARENCY.—Not more than
90 days after the Corporation establishes
and implements a restoration plan under
clause (i), the Corporation shall publish in
the Federal Register a detailed analysis of
the factors considered and the basis for the
actions taken with regard to the plan.’’.
SEC. 10. REGULATIONS REQUIRED.
(a) IN GENERAL.—Not later than 270 days after the
date of the enactment of this Act, the Board of Directors
of the Federal Deposit Insurance Corporation shall pre-
scribe final regulations, after notice and opportunity for
comment—
(1) designating the reserve ratio for the Deposit
Insurance Fund in accordance with section 7(b)(3) of
the Federal Deposit Insurance Act (as amended by
section 6 of this Act);
(2) implementing increases in deposit insurance
coverage in accordance with the amendments made by
section 3 of this Act;
(3) implementing the dividend requirement
under section 7(e)(2) of the Federal Deposit Insurance
Act (as amended by section 8 of this Act).
(4) implementing the 1-time assessment credit to
certain insured depository institutions in accordance
with section 7(e)(3) of the Federal Deposit Insurance
Act, as amended by section 8 of this Act, including
the qualifications and procedures under which the
Corporation would apply assessment credits; and
(5) providing for assessments under section 7(b)
of the Federal Deposit Insurance Act, as amended by
this Act.
(b) RULE OF CONSTRUCTION.—No provision of this
Act or any amendment made by this Act shall be construed
as affecting the authority of the Corporation to set or collect
deposit insurance assessments before the effective date of the
final regulation prescribed under subsection (a).
SEC. 11. STUDIES OF FDIC STRUCTURE AND EXPENSES AND
CERTAIN ACTIVITIES AND FURTHER POS-
SIBLE CHANGES TO DEPOSIT INSURANCE
SYSTEM.
(a) STUDY BY COMPTROLLER GENERAL.—
(1) STUDY REQUIRED.—The Comptroller General
shall conduct a study of the following issues:
(A) The efficiency and effectiveness of the
administration of the prompt corrective action
program under section 38 of the Federal Deposit
Insurance Act by the Federal banking agencies
(as defined in section 3 of such Act), including
the degree of effectiveness of such agencies in
identifying troubled depository institutions and
taking effective action with respect to such insti-
tutions, and the degree of accuracy of the risk as-
sessments made by the Corporation.
(B) The appropriateness of the organiza-
tional structure of the Federal Deposit Insurance
Corporation for the mission of the Corporation
taking into account—
(i) the current size and complexity of
the business of insured depository institu-
tions (as such term is defined in section 3
of the Federal Deposit Insurance Act);
(ii) the extent to which the organiza-
tional structure contributes to or reduces
operational inefficiencies that increase oper-
ational costs; and
(iii) the effectiveness of internal con-
trols.
(2) REPORT
TO
THE
CONGRESS.—The Comp-
troller General shall submit a report to the Congress
before the end of the 1-year period beginning on the
date of the enactment of this Act containing the find-
ings and conclusions of the Comptroller General with
respect to the study required under paragraph (1) to-
gether with such recommendations for legislative or
administrative action as the Comptroller General
may determine to be appropriate.
(b) INTERNAL STUDY BY THE FDIC.—
(1) STUDY REQUIRED.—Concurrently with the
study required to be conducted by the Comptroller
General under subsection (a), the Federal Deposit In-
surance Corporation shall conduct an internal study
of the same conditions and factors included in the
study under subsection (a).
(2) REPORT TO THE CONGRESS.—The Federal
Deposit Insurance Corporation shall submit a report
to the Congress before the end of the 1-year period be-
ginning on the date of the enactment of this Act con-
taining the findings and conclusions of the Corpora-
tion with respect to the study required under para-
graph (1) together with such recommendations for leg-
islative or administrative action as the Board of Di-
rectors of the Corporation may determine to be appro-
priate.
(c) STUDY OF FURTHER POSSIBLE CHANGES TO DE-
POSIT INSURANCE SYSTEM.—
(1) STUDY REQUIRED.—The Board of Directors
of the Federal Deposit Insurance Corporation and the
National Credit Union Administration Board shall
each conduct a study of the following:
(A) The feasibility of establishing a vol-
untary deposit insurance system for deposits in
excess of the maximum amount of deposit insur-
ance for any depositor and the potential benefits
and the potential adverse consequences that may
result from the establishment of any such system.
(B) The feasibility of privatizing all deposit
insurance at insured depository institutions and
insured credit unions.
(2) REPORT.—Before the end of the 1-year pe-
riod beginning on the date of the enactment of this
Act, the Board of Directors of the Federal Deposit In-
surance Corporation and the National Credit Union
Administration Board shall each submit a report to
the Congress on the study required under paragraph
(1) containing the findings and conclusions of the re-
porting agency together with such recommendations
for legislative or administrative changes as the agency
may determine to be appropriate.
(d) STUDY REGARDING APPROPRIATE DEPOSIT BASE
IN DESIGNATING RESERVE RATIO.—
(1) STUDY REQUIRED.—The Federal Deposit In-
surance Corporation shall conduct a study of the fea-
sibility of using actual domestic deposits rather than
estimated insured deposits in calculating the reserve
ratio of the Deposit Insurance Fund and designating
a reserve ratio for such Fund.
(2) REPORT.—The Federal Deposit Insurance
Corporation shall submit a report to the Congress be-
fore the end of the 1-year period beginning on the
date of the enactment of this Act containing the find-
ings and conclusions of the Corporation with respect
to the study required under paragraph (1) together
with such recommendations for legislative or adminis-
trative action as the Board of Directors of the Cor-
poration may determine to be appropriate.
(e) STUDY
OF RESERVE METHODOLOGY
AND AC-
COUNTING FOR LOSS.—
(1) STUDY REQUIRED.—The Federal Deposit In-
surance Corporation, in consultation with the Comp-
troller General, shall conduct a study of the reserve
methodology and loss accounting used by the Corpora-
tion during the period beginning on January 1, 1992,
and ending December 31, 2002, with respect to in-
sured depository institutions in a troubled condition
(as defined in the regulations prescribed pursuant to
section 32(f) of the Federal Deposit Insurance Act).
(2) FACTORS TO BE INCLUDED.—In conducting
the study pursuant to paragraph (1), the Federal De-
posit Insurance Corporation shall—
(A) consider the overall effectiveness and ac-
curacy of the methodology used by the Corpora-
tion for establishing and maintaining reserves
and estimating and accounting for losses at in-
sured depository institutions, during the period
described in such paragraph;
(B) consider the appropriateness and reli-
ability of information and criteria used by the
Corporation in determining—
(i) whether an insured depository in-
stitution was in a troubled condition; and
(ii) the amount of any loss anticipated
at such institution;
(C) analyze the actual historical loss experi-
ence over the period described in paragraph (1)
and the causes of the exceptionally high rate of
losses experienced by the Corporation in the final
3 years of that period; and
(D) rate the Corporation’s efforts of the Cor-
poration to reduce losses in such 3-year period to
minimally acceptable levels and to historical lev-
els.
(3) REPORT REQUIRED.—The Board of Directors
of the Federal Deposit Insurance Corporation shall
submit a report to the Congress before June 30, 2003,
containing the findings and conclusions of the Cor-
poration, in consultation with the Comptroller Gen-
eral, with respect to the study required under para-
graph (1), together with such recommendations for
legislative or administrative action as the Board of
Directors may determine to be appropriate.
SEC. 12. TECHNICAL AND CONFORMING AMENDMENTS TO
THE FEDERAL DEPOSIT INSURANCE ACT RE-
LATING TO THE MERGER OF THE BIF AND
SAIF.
(a) IN GENERAL.—The Federal Deposit Insurance Act
(12 U.S.C. 1811 et seq.) is amended—
(1) in section 3 (12 U.S.C. 1813)—
(A) by striking subparagraph (B) of sub-
section (a)(1) and inserting the following new
subparagraph:
‘‘(B) includes any former savings associa-
tion.’’; and
(B) by striking paragraph (1) of subsection
(y) (as so designated by section 6(b) of this Act)
and inserting the following new paragraph:
‘‘(1) DEPOSIT INSURANCE FUND.—The term ‘De-
posit Insurance Fund’ means the Deposit Insurance
Fund established under section 11 (a)(4).’’;
(2) in section 5(b)(5) (12 U.S.C. 1815(b)(5)), by
striking ‘‘the Bank Insurance Fund or the Savings
Association Insurance Fund,’’ and inserting ‘‘the De-
posit Insurance Fund,’’;
(3) in section 5(c)(4), by striking ‘‘deposit insur-
ance fund’’ and inserting ‘‘Deposit Insurance Fund’’;
(4) in section 5(d) (12 U.S.C. 1815(d)), by strik-
ing paragraphs (2) and (3);
(5) in section 5(d)(1) (12 U.S.C. 1815(d)(1))—
(A) in subparagraph (A), by striking ‘‘re-
serve ratios in the Bank Insurance Fund and the
Savings Association Insurance Fund as required
by section 7’’ and inserting ‘‘the reserve ratio of
the Deposit Insurance Fund’’;
(B) by striking subparagraph (B) and in-
serting the following:
‘‘(2) FEE CREDITED TO THE DEPOSIT INSUR-
ANCE FUND.—The fee paid by the depository institu-
tion under paragraph (1) shall be credited to the De-
posit Insurance Fund.’’;
(C) by striking ‘‘(1) UNINSURED INSTITU-
TIONS.—’’; and
(D) by redesignating subparagraphs (A)
and (C) as paragraphs (1) and (3), respectively,
and moving the left margins 2 ems to the left;
(6) in section 5(e) (12 U.S.C. 1815(e))—
(A) in paragraph (5)(A), by striking ‘‘Bank
Insurance Fund or the Savings Association In-
surance Fund’’ and inserting ‘‘Deposit Insurance
Fund’’;
(B) by striking paragraph (6); and
(C) by redesignating paragraphs (7), (8),
and (9) as paragraphs (6), (7), and (8), respec-
tively;
(7) in section 6(5) (12 U.S.C. 1816(5)), by strik-
ing ‘‘Bank Insurance Fund or the Savings Associa-
tion Insurance Fund’’ and inserting ‘‘Deposit Insur-
ance Fund’’;
(8) in section 7(b) (12 U.S.C. 1817(b))—
(A) in paragraph (1)(C), by striking ‘‘de-
posit insurance fund’’ each place that term ap-
pears and inserting ‘‘Deposit Insurance Fund’’;
(B) in paragraph (1)(D), by striking ‘‘each
deposit insurance fund’’ and inserting ‘‘the De-
posit Insurance Fund’’; and
(C) in paragraph (5) (as so redesignated by
section 4(f)(4) of this Act)—
(i) by striking ‘‘any such assessment’’
and inserting ‘‘any such assessment is nec-
essary’’;
(ii) by striking subparagraph (B);
(iii) in subparagraph (A)—
(I) by striking ‘‘(A) is nec-
essary—’’;
(II) by striking ‘‘Bank Insurance
Fund members’’ and inserting ‘‘in-
sured depository institutions’’; and
(III) by redesignating clauses (i),
(ii), and (iii) as subparagraphs (A),
(B), and (C), respectively, and moving
the margins 2 ems to the left; and
(iv) in subparagraph (C) (as so redes-
ignated)—
(I) by inserting ‘‘that’’ before ‘‘the
Corporation’’; and
(II) by striking ‘‘; and’’ and in-
serting a period;
(9) 
in 
section 
7(j)(7)(F) 
(12 
U.S.C.
1817(j)(7)(F)), by striking ‘‘Bank Insurance Fund or
the Savings Association Insurance Fund’’ and insert-
ing ‘‘Deposit Insurance Fund’’;
(10) 
in 
section 
8(t)(2)(C) 
(12 
U.S.C.
1818(t)(2)(C)), by striking ‘‘deposit insurance fund’’
and inserting ‘‘Deposit Insurance Fund’’;
(11) in section 11 (12 U.S.C. 1821)—
(A) by striking ‘‘deposit insurance fund’’
each place that term appears and inserting ‘‘De-
posit Insurance Fund’’;
(B) by striking paragraph (4) of subsection
(a) and inserting the following new paragraph:
‘‘(4) DEPOSIT INSURANCE FUND.—
‘‘(A) ESTABLISHMENT.—There is estab-
lished the Deposit Insurance Fund, which the
Corporation shall—
‘‘(i) maintain and administer;
‘‘(ii) use to carry out its insurance
purposes, in the manner provided by this
subsection; and
‘‘(iii) invest in accordance with section
13(a).
‘‘(B) USES.—The Deposit Insurance Fund
shall be available to the Corporation for use with
respect to insured depository institutions the de-
posits of which are insured by the Deposit Insur-
ance Fund.
‘‘(C) 
LIMITATION
ON
USE.—Notwith-
standing any provision of law other than section
13(c)(4)(G), the Deposit Insurance Fund shall
not be used in any manner to benefit any share-
holder or affiliate (other than an insured deposi-
tory institution that receives assistance in ac-
cordance with the provisions of this Act) of—
‘‘(i) any insured depository institution
for which the Corporation has been ap-
pointed conservator or receiver, in connec-
tion with any type of resolution by the Cor-
poration;
‘‘(ii) any other insured depository in-
stitution in default or in danger of default,
in connection with any type of resolution
by the Corporation; or
‘‘(iii) any insured depository institu-
tion, in connection with the provision of as-
sistance under this section or section 13
with respect to such institution, except that
this clause shall not prohibit any assistance
to any insured depository institution that is
not in default, or that is not in danger of
default, that is acquiring (as defined in sec-
tion 13(f)(8)(B)) another insured depository
institution.
‘‘(D) DEPOSITS.—All amounts assessed
against insured depository institutions by the
Corporation shall be deposited into the Deposit
Insurance Fund.’’;
(C) by striking paragraphs (5), (6), and (7)
of subsection (a); and
(D) by redesignating paragraph (8) of sub-
section (a) as paragraph (5);
(12) in section 11(f)(1) (12 U.S.C. 1821(f)(1)),
by striking ‘‘, except that—’’ and all that follows
through the end of the paragraph and inserting a pe-
riod;
(13) in section 11(i)(3) (12 U.S.C. 1821(i)(3))—
(A) by striking subparagraph (B);
(B) by redesignating subparagraph (C) as
subparagraph (B); and
(C) in subparagraph (B) (as so redesig-
nated), by striking ‘‘subparagraphs (A) and (B)’’
and inserting ‘‘subparagraph (A)’’;
(14) 
in 
section 
11(p)(2)(B) 
(12 
U.S.C.
1821(p)(2)(B)), by striking ‘‘institution, any’’ and
inserting ‘‘institution, the’’;
(15) in section 11A(a) (12 U.S.C. 1821a(a))—
(A) in paragraph (2), by striking ‘‘LIABIL-
ITIES.—’’ and all that follows through ‘‘Except’’
and inserting ‘‘LIABILITIES.—Except’’;
(B) by striking paragraph (2)(B); and
(C) in paragraph (3), by striking ‘‘the
Bank Insurance Fund, the Savings Association
Insurance Fund,’’ and inserting ‘‘the Deposit In-
surance Fund’’;
(16) in section 11A(b) (12 U.S.C. 1821a(b)), by
striking paragraph (4);
(17) in section 11A(f) (12 U.S.C. 1821a(f)), by
striking ‘‘Savings Association Insurance Fund’’ and
inserting ‘‘Deposit Insurance Fund’’;
(18) in section 12(f)(4)(E)(iv) (12 U.S.C.
1822(f)(4)(E)(iv)), by striking ‘‘Federal deposit insur-
ance funds’’ and inserting ‘‘the Deposit Insurance
Fund (or any predecessor deposit insurance fund)’’;
(19) in section 13 (12 U.S.C. 1823)—
(A) by striking ‘‘deposit insurance fund’’
each place that term appears and inserting ‘‘De-
posit Insurance Fund’’;
(B) in subsection (a)(1), by striking ‘‘Bank
Insurance Fund, the Savings Association Insur-
ance Fund,’’ and inserting ‘‘Deposit Insurance
Fund’’;
(C) in subsection (c)(4)(E)—
(i) in the subparagraph heading, by
striking ‘‘FUNDS’’ and inserting ‘‘FUND’’;
and
(ii) in clause (i), by striking ‘‘any in-
surance fund’’ and inserting ‘‘the Deposit
Insurance Fund’’;
(D) in subsection (c)(4)(G)(ii)—