I 
113TH CONGRESS 
1ST SESSION H. R. 3711 
To reduce risks to the financial system by limiting banks’ ability to engage 
in certain risky activities and limiting conflicts of interest, to reinstate 
certain Glass-Steagall Act protections that were repealed by the Gramm- 
Leach-Bliley Act, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
DECEMBER 11, 2013 
Mr. TIERNEY (for himself and Mr. JONES) introduced the following bill; which 
was referred to the Committee on Financial Services, and in addition to 
the Committee on the Judiciary, for a period to be subsequently deter-
mined by the Speaker, in each case for consideration of such provisions 
as fall within the jurisdiction of the committee concerned 
A BILL 
To reduce risks to the financial system by limiting banks’ 
ability to engage in certain risky activities and limiting 
conflicts of interest, to reinstate certain Glass-Steagall 
Act protections that were repealed by the Gramm-Leach- 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. 
This Act may be cited as the ‘‘21st Century Glass- 
Steagall Act of 2013’’. 
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SEC. 2. FINDINGS AND PURPOSE. 
(a) FINDINGS.—Congress finds that— 
(1) in response to a financial crisis and the en-
suing Great Depression, Congress enacted the Bank-
ing Act of 1933, known as the ‘‘Glass-Steagall Act’’, 
to prohibit commercial banks from offering invest-
ment banking and insurance services; 
(2) a series of deregulatory decisions by the 
Board of Governors of the Federal Reserve System 
and the Office of the Comptroller of the Currency, 
in addition to decisions by Federal courts, permitted 
commercial banks to engage in an increasing num-
ber of risky financial activities that had previously 
been restricted under the Glass-Steagall Act, and 
also vastly expanded the meaning of the ‘‘business of 
banking’’ and ‘‘closely related activities’’ in banking 
law; 
(3) in 1999, Congress enacted the ‘‘Gramm- 
Leach-Bliley Act’’, which repealed the Glass-Steagall 
Act separation between commercial and investment 
banking and allowed for complex cross-subsidies and 
interconnections between commercial and investment 
banks; 
(4) former Kansas City Federal Reserve Presi-
dent Thomas Hoenig observed that ‘‘with the elimi-
nation of Glass-Steagall, the largest institutions with 
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the greatest ability to leverage their balance sheets 
increased their risk profile by getting into trading, 
market making, and hedge fund activities, adding 
ever greater complexity to their balance sheets.’’; 
(5) the Financial Crisis Inquiry Report issued 
by the Financial Crisis Inquiry Commission con-
cluded that, in the years between the passage of 
Gramm-Leach Bliley and the global financial crisis, 
‘‘regulation and supervision of traditional banking 
had been weakened significantly, allowing commer-
cial banks and thrifts to operate with fewer con-
straints and to engage in a wider range of financial 
activities, including activities in the shadow banking 
system.’’. The Commission also concluded that 
‘‘[t]his deregulation made the financial system espe-
cially vulnerable to the financial crisis and exacer-
bated its effects.’’; 
(6) a report by the Financial Stability Over-
sight Council pursuant to section 123 of the Dodd- 
Frank Wall Street Reform and Consumer Protection 
Act states that increased complexity and diversity of 
financial activities at financial institutions may 
‘‘shift institutions towards more risk-taking, increase 
the level of interconnectedness among financial 
firms, and therefore may increase systemic default 
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risk. These potential costs may be exacerbated in 
cases where the market perceives diverse and com-
plex financial institutions as ‘too big to fail,’ which 
may lead to excessive risk taking and concerns about 
moral hazard.’’; 
(7) the Senate Permanent Subcommittee on In-
vestigations report, ‘‘Wall Street and the Financial 
Crisis: Anatomy of a Financial Collapse’’, states that 
repeal of Glass-Steagall ‘‘made it more difficult for 
regulators to distinguish between activities intended 
to benefit customers versus the financial institution 
itself. The expanded set of financial services invest-
ment banks were allowed to offer also contributed to 
the multiple and significant conflicts of interest that 
arose between some investment banks and their cli-
ents during the financial crisis.’’; 
(8) the Senate Permanent Subcommittee on In-
vestigations 
report, 
‘‘JPMorgan 
Chase 
Whale 
Trades: A Case History of Derivatives Risks and 
Abuses’’, describes how traders at JPMorgan Chase 
made risky bets using excess deposits that were 
partly insured by the Federal Government; 
(9) in Europe, the Vickers Independent Com-
mission on Banking (for the United Kingdom) and 
the Liikanen Report (for the Euro area) have both 
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found that there is no inherent reason to bundle ‘‘re-
tail banking’’ with ‘‘investment banking’’ or other 
forms of relatively high risk securities trading, and 
European countries are set on a path of separating 
various activities that are currently bundled together 
in the business of banking; 
(10) private sector actors prefer having access 
to underpriced public sector insurance, whether ex-
plicit (for insured deposits) or implicit (for ‘‘too big 
to fail’’ financial institutions), to subsidize dan-
gerous levels of risk-taking, which, from a broader 
social perspective, is not an advantageous arrange-
ment; and 
(11) the financial crisis, and the regulatory re-
sponse to the crisis, has led to more mergers be-
tween financial institutions, creating greater finan-
cial sector consolidation and increasing the domi-
nance of a few large, complex financial institutions 
that are generally considered to be ‘‘too big to fail’’, 
and therefore are perceived by the markets as hav-
ing an implicit guarantee from the Federal Govern-
ment to bail them out in the event of their failure. 
(b) PURPOSE.—The purposes of this Act are— 
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(1) to reduce risks to the financial system by 
limiting banks’ ability to engage in activities other 
than socially valuable core banking activities; 
(2) to protect taxpayers and reduce moral haz-
ard by removing explicit and implicit government 
guarantees for high-risk activities outside of the core 
business of banking; and 
(3) to eliminate conflicts of interest that arise 
from banks engaging in activities from which their 
profits are earned at the expense of their customers 
or clients. 
SEC. 3. SAFE AND SOUND BANKING. 
(a) INSURED DEPOSITORY INSTITUTIONS.—Section 
18(s) of the Federal Deposit Insurance Act (12 U.S.C. 
1828(s)) is amended by adding at the end the following: 
‘‘(6) 
LIMITATIONS
ON
BANKING
AFFILI-
ATIONS.— 
‘‘(A) PROHIBITION ON AFFILIATIONS WITH 
NONDEPOSITORY ENTITIES.—An insured depos-
itory institution may not— 
‘‘(i) be or become an affiliate of any 
insurance company, securities entity, or 
swaps entity; 
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‘‘(ii) be in common ownership or con-
trol with any insurance company, securities 
entity, or swaps entity; or 
‘‘(iii) engage in any activity that 
would cause the insured depository institu-
tion to qualify as an insurance company, 
securities entity, or swaps entity. 
‘‘(B) INDIVIDUALS ELIGIBLE TO SERVE ON 
BOARDS OF DEPOSITORY INSTITUTIONS.— 
‘‘(i) IN GENERAL.—An individual who 
is an officer, director, partner, or employee 
of any securities entity, insurance com-
pany, or swaps entity may not serve at the 
same time as an officer, director, employee, 
or other institution-affiliated party of any 
insured depository institution. 
‘‘(ii) EXCEPTION.—Clause (i) does not 
apply with respect to service by any indi-
vidual which is otherwise prohibited under 
clause (i), if the appropriate Federal bank-
ing agency determines, by regulation with 
respect to a limited number of cases, that 
service by such an individual as an officer, 
director, employee, or other institution-af-
filiated party of an insured depository in-
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stitution would not unduly influence the in-
vestment policies of the depository institu-
tion or the advice that the institution pro-
vides to customers. 
‘‘(iii) TERMINATION
OF
SERVICE.— 
Subject to a determination under clause 
(i), any individual described in clause (i) 
who, as of the date of enactment of the 
21st Century Glass-Steagall Act of 2013, 
is serving as an officer, director, employee, 
or other institution-affiliated party of any 
insured depository institution shall termi-
nate such service as soon as is practicable 
after such date of enactment, and in no 
event, later than the end of the 60-day pe-
riod beginning on that date of enactment. 
‘‘(C) TERMINATION OF EXISTING AFFILI-
ATIONS AND ACTIVITIES.— 
‘‘(i) ORDERLY TERMINATION OF EX-
ISTING
AFFILIATIONS
AND
ACTIVITIES.— 
Any affiliation, common ownership or con-
trol, or activity of an insured depository in-
stitution with any securities entity, insur-
ance company, or swaps entity, or any 
other person, as of the date of enactment 
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of the 21st Century Glass-Steagall Act of 
2013, which is prohibited under subpara-
graph (A) shall be terminated as soon as 
is practicable, and in no event later than 
the end of the 5-year period beginning on 
that date of enactment. 
‘‘(ii) EARLY TERMINATION.—The ap-
propriate Federal banking agency, after 
opportunity for hearing, at any time, may 
order termination of an affiliation, common 
ownership or control, or activity prohibited 
by clause (i) before the end of the 5-year 
period described in clause (i), if the agency 
determines that— 
‘‘(I) such action is necessary to 
prevent undue concentration of re-
sources, decreased or unfair competi-
tion, conflicts of interest, or unsound 
banking practices; and 
‘‘(II) is in the public interest. 
‘‘(iii) EXTENSION.—Subject to a de-
termination under clause (ii), an appro-
priate Federal banking agency may extend 
the 5-year period described in clause (i) as 
to any particular insured depository insti-
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tution for not more than an additional 6 
months at a time, if— 
‘‘(I) the agency certifies that 
such extension would promote the 
public interest and would not pose a 
significant threat to the stability of 
the banking system or financial mar-
kets in the United States; and 
‘‘(II) such extension, in the ag-
gregate, does not exceed 1 year for 
any one insured depository institution. 
‘‘(iv) REQUIREMENTS
FOR
ENTITIES 
RECEIVING AN EXTENSION.—Upon receipt 
of an extension under clause (iii), the in-
sured depository institution shall notify its 
shareholders and the general public that it 
has failed to comply with the requirements 
of clause (i). 
‘‘(D) DEFINITIONS.—For purposes of this 
paragraph, the following definitions shall apply: 
‘‘(i) INSURANCE COMPANY.—The term 
‘insurance company’ has the same meaning 
as in section 2(q) of the Bank Holding 
Company 
Act 
of 
1956 
(12 
U.S.C. 
1841(q)). 
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‘‘(ii) SECURITIES ENTITY.—Except as 
provided in clause (iii), the term ‘securities 
entity’— 
‘‘(I) includes any entity engaged 
in— 
‘‘(aa) the issue, flotation, 
underwriting, public sale, or dis-
tribution of stocks, bonds, deben-
tures, notes, or other securities; 
‘‘(bb) market making; 
‘‘(cc) activities of a broker 
or dealer, as those terms are de-
fined in section 3(a) of the Secu-
rities Exchange Act of 1934; 
‘‘(dd) activities of a futures 
commission merchant; 
‘‘(ee) activities of an invest-
ment adviser or investment com-
pany, as those terms are defined 
in the Investment Advisers Act of 
1940 and the Investment Com-
pany Act of 1940, respectively; or 
‘‘(ff) hedge fund or private 
equity investments in the securi-
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ties of either privately or publicly 
held companies; and 
‘‘(II) does not include a bank 
that, pursuant to its authorized trust 
and fiduciary activities, purchases and 
sells investments for the account of its 
customers or provides financial or in-
vestment advice to its customers. 
‘‘(iii) 
SWAPS
ENTITY.—The 
term 
‘swaps entity’ means any swap dealer, se-
curity-based swap dealer, major swap par-
ticipant, or major security-based swap par-
ticipant, that is registered under— 
‘‘(I) the Commodity Exchange 
Act (7 U.S.C. 1 et seq.); or 
‘‘(II) the Securities Exchange 
Act of 1934 (15 U.S.C. 78a et seq.). 
‘‘(iv) INSURED DEPOSITORY INSTITU-
TION.—The term ‘insured depository insti-
tution’— 
‘‘(I) has the same meaning as in 
section 3(c)(2); and 
‘‘(II) does not include a savings 
association controlled by a savings 
and loan holding company, as de-
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scribed in section 10(c)(9)(C) of the 
Home Owners’ Loan Act (12 U.S.C. 
1467a(c)(9)(C)).’’. 
(b) LIMITATION ON BANKING ACTIVITIES.—Section 
21 of the Banking Act of 1933 (12 U.S.C. 378) is amend-
ed by adding at the end the following: 
‘‘(c) BUSINESS OF RECEIVING DEPOSITS.—For pur-
poses of this section, the term ‘business of receiving depos-
its’ includes the establishment and maintenance of any 
transaction account (as defined in section 19(b)(1)(C) of 
the Federal Reserve Act).’’. 
(c) PERMITTED ACTIVITIES OF NATIONAL BANKS.— 
Section 24 (Seventh) of the Revised Statutes of the United 
States (12 U.S.C. 24 (Seventh)) is amended to read as 
follows: 
‘‘Seventh. (A) To exercise by its board of direc-
tors or duly authorized officers or agents, subject to 
law, all such powers as are necessary to carry on the 
business of banking. 
‘‘(B) As used in this paragraph, the term ‘busi-
ness of banking’ shall be limited to the following 
core banking services: 
‘‘(i) RECEIVING
DEPOSITS.—A national 
banking association may engage in the business 
of receiving deposits. 
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‘‘(ii) EXTENSIONS OF CREDIT.—A national 
banking association may— 
‘‘(I) extend credit to individuals, busi-
nesses, not for profit organizations, and 
other entities; 
‘‘(II) discount and negotiate promis-
sory notes, drafts, bills of exchange, and 
other evidences of debt; and 
‘‘(III) loan money on personal secu-
rity. 
‘‘(iii) PAYMENT
SYSTEMS.—A national 
banking association may participate in payment 
systems, defined as instruments, banking proce-
dures, and interbank funds transfer systems 
that ensure the circulation of money. 
‘‘(iv) COIN
AND
BULLION.—A national 
banking association may buy, sell, and exchange 
coin and bullion. 
‘‘(v) INVESTMENTS IN SECURITIES.— 
‘‘(I) IN GENERAL.—A national bank-
ing association may invest in investment 
securities, defined as marketable obliga-
tions evidencing indebtedness of any per-
son, copartnership, association, or corpora-
tion in the form of bonds, notes, or deben-
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tures (commonly known as ‘investment se-
curities’), obligations of the Federal Gov-
ernment, or any State or subdivision there-
of, under such further definition of the 
term ‘investment securities’ as the Comp-
troller of the Currency, the Federal De-
posit Insurance Corporation, and the 
Board of Governors of the Federal Reserve 
System may jointly prescribe, by regula-
tion. 
‘‘(II) LIMITATIONS.—The business of 
dealing in securities and stock by the asso-
ciation shall be limited to purchasing and 
selling such securities and stock without 
recourse, solely upon the order, and for the 
account of, customers, and in no case for 
its own account, and the association shall 
not underwrite any issue of securities or 
stock. The association may purchase for its 
own account investment securities under 
such limitations and restrictions as the 
Comptroller of the Currency, the Federal 
Deposit Insurance Corporation, and the 
Board of Governors of the Federal Reserve 
System may jointly prescribe, by regula-
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tion. In no event shall the total amount of 
the investment securities of any one obligor 
or maker, held by the association for its 
own account, exceed at any time 10 per-
cent of its capital stock actually paid in 
and unimpaired and 10 percent of its 
unimpaired surplus fund, except that such 
limitation shall not require any association 
to dispose of any securities lawfully held by 
it on August 23, 1935. 
‘‘(C) PROHIBITION AGAINST TRANSACTIONS IN-
VOLVING STRUCTURED OR SYNTHETIC PRODUCTS.— 
A national banking association shall not invest in a 
structured or synthetic product, a financial instru-
ment in which a return is calculated based on the 
value of, or by reference to the performance of, a se-
curity, commodity, swap, other asset, or an entity, or 
any index or basket composed of securities, commod-
ities, swaps, other assets, or entities, other than cus-
tomarily determined interest rates, or otherwise en-
gage in the business of receiving deposits or extend-
ing credit for transactions involving structured or 
synthetic products.’’. 
(d) PERMITTED ACTIVITIES OF FEDERAL SAVINGS 
ASSOCIATIONS.— 
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(1) IN GENERAL.—Section 5(c)(1) of the Home 
Owners’ Loan Act (12 U.S.C. 1464(c)(1)) is amend-
ed— 
(A) by striking subparagraph (Q); and 
(B) by redesignating subparagraphs (R) 
through (U) as subparagraphs (Q) through (T), 
respectively. 
(2) 
CONFORMING
AMENDMENT.—Section 
10(c)(9)(A) of the Home Owners’ Loan Act (12 
U.S.C. 1467a(c)(9)(A)) is amended by striking ‘‘per-
mitted—’’ and all that follows through clause (ii) 
and inserting ‘‘permitted under paragraph (1)(C) or 
(2).’’. 
(e) CLOSELY RELATED ACTIVITIES.—Section 4(c) of 
the Bank Holding Company Act of 1956 (12 U.S.C. 
1843(c)) is amended— 
(1) in paragraph (8), by striking ‘‘had been de-
termined’’ and all that follows through the end and 
inserting the following: ‘‘are so closely related to 
banking so as to be a proper incident thereto, as 
provided under this paragraph or any rule or regula-
tion issued by the Board under this paragraph, pro-
vided that the following shall not be considered 
closely related for purposes of this paragraph: 
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‘‘(A) Serving as an investment advisor (as 
defined in section 2(a)(20) of the Investment 
Company Act of 1940 (15 U.S.C. 80a– 
2(a)(20))) to an investment company registered 
under that Act, including sponsoring, orga-
nizing, and managing a closed-end investment 
company. 
‘‘(B) Agency transactional services for cus-
tomer investments, except that this subpara-
graph may not be construed as prohibiting pur-
chases and sales of investments for the account 
of customers conducted by a bank (or sub-
sidiary thereof) pursuant to the bank’s trust 
and fiduciary powers. 
‘‘(C) Investment transactions as principal, 
except for activities specifically allowed by para-
graph (14). 
‘‘(D) Management consulting and coun-
seling activities.’’; 
(2) in paragraph (13), by striking ‘‘or’’ at the 
end; 
(3) by redesignating paragraph (14) as para-
graph (15); and 
(4) by inserting after paragraph (13) the fol-
lowing: 
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‘‘(14) purchasing, as an end user, any swap, to 
the extent that— 
‘‘(A) the purchase of any such swap occurs 
contemporaneously with the underlying hedged 
item or hedged transaction; 
‘‘(B) there is formal documentation identi-
fying the hedging relationship with particularity 
at the inception of the hedge; and 
‘‘(C) the swap is being used to hedge 
against exposure to— 
‘‘(i) changes in the value of an indi-
vidual recognized asset or liability or an 
identified portion thereof that is attrib-
utable to a particular risk; 
‘‘(ii) changes in interest rates; or 
‘‘(iii) changes in the value of currency; 
or’’. 
(f) PROHIBITED ACTIVITIES.—Section 4(a) of the 
Bank Holding Company Act of 1956 (12 U.S.C. 1843(a)) 
is amended— 
(1) in paragraph (1), by striking ‘‘or’’ at the 
end; 
(2) in paragraph (2), by striking the period at 
the end and inserting ‘‘; or’’; and 
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(3) by inserting before the undesignated matter 
following paragraph (2), the following: 
‘‘(3) with the exception of the activities per-
mitted under subsection (c), engage in the business 
of a ‘securities entity’ or a ‘swaps entity’, as those 
terms are defined in section 18(s)(6)(D) of the Fed-
eral 
Deposit 
Insurance 
Act 
(12 
U.S.C. 
1828(s)(6)(D)), including, without limitation, deal-
ing or making markets in securities, repurchase 
agreements, exchange traded and over-the-counter 
swaps, as defined by the Commodity Futures Trad-
ing Commission and the Securities and Exchange 
Commission, or structured or synthetic products, as 
defined in section 24 (Seventh) of the Revised Stat-
utes of the United States (12 U.S.C. 24 (Seventh)), 
or any other over-the-counter securities, swaps, con-
tracts, or any other agreement that derives its value 
from, or takes on the form of, such securities, de-
rivatives, or contracts; 
‘‘(4) engage in proprietary trading, as provided 
by section 13, or any rule or regulation under that 
section; 
‘‘(5) own, sponsor, or invest in a hedge fund, or 
private equity fund, or any other fund, as provided 
by section 13, or any rule or regulation under that 
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section, or any other fund which exhibits the charac-
teristics of a fund that takes on proprietary trading 
activities or positions; 
‘‘(6) hold ineligible securities or derivatives; 
‘‘(7) engage in market-making; or 
‘‘(8) engage in prime brokerage activities.’’. 
(g) ANTI-EVASION.— 
(1) IN
GENERAL.—Any attempt to structure 
any contract, investment, instrument, or product in 
such a manner that the purpose or effect of such 
contract, investment, instrument, or product is to 
evade or attempt to evade the prohibitions described 
in section 18(s)(6) of the Federal Deposit Insurance 
Act, section 21(c) of the Banking Act of 1933, para-
graph (Seventh) of section 24 of the Revised Stat-
utes of the United States, section 5(c)(1) of the 
Home Owners’ Loan Act, or section 4(a) of the 
Bank Holding Company Act of 1956, as added or 
amended by this section, shall be considered a viola-
tion of the Federal Deposit Insurance Act, the 
Banking Act of 1933, section 24 of the Revised 
Statutes of the United States, the Home Owners’ 
Loan Act, and the Bank Holding Company Act of 
1956, respectively. 
(2) TERMINATION.— 
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(A) IN
GENERAL.—Notwithstanding any 
other provision of law, if a Federal agency has 
reasonable cause to believe that an insured de-
pository institution, securities entity, swaps en-
tity, insurance company, bank holding company, 
or other entity over which that agency has reg-
ulatory authority has made an investment or 
engaged in an activity in a manner that func-
tions as an evasion of the prohibitions described 
in paragraph (1) (including through an abuse 
of any permitted activity) or otherwise violates 
such prohibitions, the agency shall— 
(i) order, after due notice and oppor-
tunity for hearing, the entity to terminate 
the activity and, as relevant, dispose of the 
investment; 
(ii) order, after the procedures de-
scribed in clause (i), the entity to pay a 
penalty equal to 10 percent of the entity’s 
net profits, averaged over the previous 3 
years, into the United States Treasury; 
and 
(iii) initiate proceedings described in 
12 U.S.C. 1818(e) for individuals involved 
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in evading the prohibitions described in 
paragraph (1). 
(B) 
CONSTRUCTION.—Nothing 
in 
this 
paragraph shall be construed to limit the inher-
ent authority of any Federal agency or State 
regulatory authority to further restrict any in-
vestments or activities under otherwise applica-
ble provisions of law. 
(3) REPORTING
REQUIREMENT.—Each year, 
each Federal agency having regulatory authority 
over any entity described in paragraph (2)(A) shall 
issue a report to the Committee on Banking, Hous-
ing, and Urban Affairs of the Senate and the Com-
mittee on Financial Services of the House of Rep-
resentatives, and shall make such report available to 
the public. The report shall identify the number and 
character of any activities that took place in the pre-
ceding year that function as an evasion of the prohi-
bitions described in paragraph (1), the names of the 
particular entities engaged in those activities, and 
the actions of the agency taken under paragraph 
(2). 
(h) ATTESTATION.—Section 4 of the Bank Holding 
Company Act of 1956 (12 U.S.C. 1843), as amended by 
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emcdonald on DSK67QTVN1PROD with BILLS
section 3(a)(1) of this Act, is amended by adding at the 
end the following: 
‘‘(k) ATTESTATION.—Executives of any bank holding 
company or its affiliate shall attest in writing, under pen-
alty of perjury, that the bank holding company or affiliate 
is not engaged in any activity that is prohibited under sub-
section (a), except to the extent that such activity is per-
mitted under subsection (c).’’. 
SEC. 4. REPEAL OF GRAMM-LEACH-BLILEY ACT PROVI-
SIONS. 
(a) TERMINATION
OF FINANCIAL HOLDING COM-
PANY DESIGNATION.— 
(1) IN GENERAL.—Section 4 of the Bank Hold-
ing Company Act of 1956 (12 U.S.C. 1843) is 
amended by striking subsections (k), (l), (m), (n), 
and (o). 
(2) TRANSITION.— 
(A) ORDERLY TERMINATION OF EXISTING 
AFFILIATION.—In the case of a bank holding 
company which, pursuant to the amendments 
made by paragraph (1), is no longer authorized 
to control or be affiliated with any entity that 
was permissible for a financial holding company 
on the day before the date of enactment of this 
Act, any affiliation, ownership or control, or ac-
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emcdonald on DSK67QTVN1PROD with BILLS
tivity by the bank holding company which is not 
permitted for a bank holding company shall be 
terminated as soon as is practicable, and in no 
event later than the end of the 5-year period 
beginning on the date of enactment of this Act. 
(B) EARLY TERMINATION.—The Board of 
Governors of the Federal Reserve System (in 
this section referred to as the ‘‘Board’’), after 
opportunity for hearing, at any time, may ter-
minate an affiliation prohibited by subpara-
graph (A) before the end of the 5-year period 
described in subparagraph (A), if the Board de-
termines that such action— 
(i) is necessary to prevent undue con-
centration of resources, decreased or unfair 
competition, conflicts of interest, or un-
sound banking practices; and 
(ii) is in the public interest. 
(C) EXTENSION.—Subject to a determina-
tion under subparagraph (B), the Board may 
extend the 5-year period described in subpara-
graph (A), as to any particular bank holding 
company, for not more than an additional 6 
months at a time, if— 
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(i) the Board certifies that such ex-
tension would promote the public interest 
and would not pose a significant risk to 
the stability of the banking system or fi-
nancial markets of the United States; and 
(ii) such extension, in the aggregate, 
does not exceed 1 year for any one bank 
holding company. 
(D) REQUIREMENTS
FOR
ENTITIES
RE-
CEIVING AN EXTENSION.—Upon receipt of an 
extension under subparagraph (C), the bank 
holding company shall notify its shareholders 
and the general public that it has failed to com-
ply with the requirements of subparagraph (A). 
(3) TECHNICAL
AND
CONFORMING
AMEND-
MENTS.— 
(A) BANK
HOLDING
COMPANY
ACT
OF 
1956.—The Bank Holding Company Act of 
1956 (12 U.S.C. 1841 et seq.) is amended— 
(i) in section 2 (12 U.S.C. 1841)— 
(I) by striking subsection (p); 
and 
(II) by redesignating subsection 
(q) as subsection (p); 
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(ii) 
in 
section 
5(c) 
(12 
U.S.C. 
1844(c)), by striking paragraphs (3), (4), 
and (5); and 
(iii) in section 5 (12 U.S.C. 1844), by 
striking subsection (g). 
(4) FDIA.—The Federal Deposit Insurance Act 
(12 U.S.C. 1811 et seq.) is amended— 
(A) by striking sections 45 and 46 (12 
U.S.C. 1831v, 1831w); and 
(B) by redesignating sections 47 through 
50 as sections 45 through 48, respectively. 
(5) GRAMM-LEACH-BLILEY.—Subtitle B of title 
I of the Gramm-Leach-Bliley Act is amended by 
striking section 115 (12 U.S.C. 1820a). 
(b) FINANCIAL SUBSIDIARIES OF NATIONAL BANKS 
DISALLOWED.— 
(1) IN GENERAL.—Section 5136A of the Re-
vised Statutes of the United States (12 U.S.C. 24a) 
is repealed. 
(2) TRANSITION.— 
(A) ORDERLY TERMINATION OF EXISTING 
AFFILIATION.—In the case of a national bank 
which, pursuant to the amendment made by 
paragraph (1), is no longer authorized to con-
trol or be affiliated with a financial subsidiary 
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as of the date of enactment of this Act, such af-
filiation, ownership or control, or activity shall 
be terminated as soon as is practicable, and in 
no event later than the end of the 5-year period 
beginning on the date of enactment of this Act. 
(B) EARLY
TERMINATION.—The Comp-
troller of the Currency (in this section referred 
to as the ‘‘Comptroller’’), after opportunity for 
hearing, at any time, may terminate an affili-
ation prohibited by subparagraph (A) before the 
end of the 5-year period described in subpara-
graph (A), if the Comptroller determines, hav-
ing due regard for the purposes of this Act, 
that— 
(i) such action is necessary to prevent 
undue concentration of resources, de-
creased or unfair competition, conflicts of 
interest, or unsound banking practices; and 
(ii) is in the public interest. 
(C) EXTENSION.—Subject to a determina-
tion under subparagraph (B), the Comptroller 
may extend the 5-year period described in sub-
paragraph (A) as to any particular national 
bank for not more than an additional 6 months, 
if— 
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(i) the Comptroller certifies that such 
extension would promote the public inter-
est and would not pose a significant risk to 
the stability of the banking system or fi-
nancial markets of the United States; and 
(ii) such extension, in the aggregate, 
does not exceed 1 year for any single na-
tional bank. 
(D) REQUIREMENTS
FOR
ENTITIES
RE-
CEIVING AN EXTENSION.—Upon receipt of an 
extension under subparagraph (C), the national 
bank shall notify its shareholders and the gen-
eral public that it has failed to comply with the 
requirements described in subparagraph (A). 
(3) TECHNICAL
AND
CONFORMING
AMEND-
MENT.—The 20th undesignated paragraph of section 
9 of the Federal Reserve Act (12 U.S.C. 335) is 
amended by striking the last sentence. 
(4) CLERICAL AMENDMENT.—The table of sec-
tions for chapter one of title LXII of the Revised 
Statutes of the United States is amended by striking 
the item relating to section 5136A. 
(c) REPEAL OF PROVISION RELATING TO FOREIGN 
BANKS FILING AS FINANCIAL HOLDING COMPANIES.— 
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Section 8(c) of the International Banking Act of 1978 (12 
U.S.C. 3106(c)) is amended by striking paragraph (3). 
SEC. 5. REPEAL OF BANKRUPTCY PROVISIONS. 
Title 11, United States Code, is amended by striking 
sections 555, 559, 560, 561, and 562. 
Æ 
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