vision of a State-chartered credit union, the Board
may, in the Board’s discretion, furnish any report
of examination or other confidential supervisory in-
formation concerning any credit union or other enti-
ty examined by the Board under authority of any
Federal law, to—
‘‘(A) any other Federal or State agency or
authority with supervisory or regulatory author-
ity over the credit union or other entity;
‘‘(B) any officer, director, or receiver of
such credit union or entity; and
‘‘(C) any other institution-affiliated party
of such credit union or entity the Board deter-
mines to be appropriate.’’.
SEC. 603. PENALTY FOR UNAUTHORIZED PARTICIPATION
BY CONVICTED INDIVIDUAL.
Section 19 of the Federal Deposit Insurance Act (12
U.S.C. 1829) is amended by adding at the end the fol-
lowing new subsection:
‘‘(c) NONINSURED BANKS.—Subsections (a) and (b)
shall apply to a noninsured national bank and a non-
insured State member bank, and any agency or non-
insured branch (as such terms are defined in section 1(b)
of the International Banking Act of 1978) of a foreign
bank as if such bank, branch, or agency were an insured
depository institution, except such subsections shall be ap-
plied for purposes of this subsection by substituting the
agency determined under the following paragraphs for
‘Corporation’ each place such term appears in such sub-
sections:
‘‘(1) The Comptroller of the Currency, in the
case of a noninsured national bank or any Federal
agency or noninsured Federal branch of a foreign
bank.
‘‘(2) The Board of Governors of the Federal
Reserve System, in the case of a noninsured State
member bank or any State agency or noninsured
State branch of a foreign bank.’’.
SEC. 604. AMENDMENT PERMITTING THE DESTRUCTION OF
OLD RECORDS OF A DEPOSITORY INSTITU-
TION BY THE FDIC AFTER THE APPOINTMENT
OF THE FDIC AS RECEIVER.
Section 11(d)(15)(D) of the Federal Deposit Insur-
ance Act (12 U.S.C. 1821(d)(15)(D)) is amended—
(1) by striking ‘‘RECORDKEEPING
REQUIRE-
MENT.—After the end of the 6-year period’’ and in-
serting ‘‘RECORDKEEPING REQUIREMENT.—
‘‘(i) IN
GENERAL.—Except as pro-
vided in clause (ii), after the end of the 6-
year period’’; and
(2) by adding at the end the following new
clause:
‘‘(ii) OLD RECORDS.—In the case of
records of an insured depository institution
which are at least 10 years old as of the
date the Corporation is appointed as the
receiver of such depository institution, the
Corporation may destroy such records in
accordance with clause (i) any time after
such appointment is final without regard
to the 6-year period of limitation contained
in such clause.’’.
SEC. 605. MODERNIZATION OF RECORDKEEPING REQUIRE-
MENT.
Subsection (f) of section 10 of the Federal Deposit
Insurance Act (12 U.S.C. 1820(f)) is amended to read as
follows:
‘‘(f) PRESERVATION OF AGENCY RECORDS.—
‘‘(1) IN GENERAL.—A Federal banking agency
may cause any and all records, papers, or documents
kept by the agency or in the possession or custody
of the agency to be—
‘‘(A) photographed or microphotographed
or otherwise reproduced upon film; or
‘‘(B) preserved in any electronic medium
or format which is capable of—
‘‘(i) being read or scanned by com-
puter; and
‘‘(ii) being reproduced from such elec-
tronic medium or format by printing or
any other form of reproduction of elec-
tronically stored data.
‘‘(2) TREATMENT AS ORIGINAL RECORDS.—Any
photographs, microphotographs, or photographic
film or copies thereof described in paragraph (1)(A)
or reproduction of electronically stored data de-
scribed in paragraph (1)(B) shall be deemed to be
an original record for all purposes, including intro-
duction in evidence in all State and Federal courts
or administrative agencies and shall be admissible to
prove any act, transaction, occurrence, or event
therein recorded.
‘‘(3) AUTHORITY OF THE FEDERAL BANKING
AGENCIES.—Any photographs, microphotographs, or
photographic film or copies thereof described in
paragraph (1)(A) or reproduction of electronically
stored data described in paragraph (1)(B) shall be
preserved in such manner as the Federal banking
agency shall prescribe and the original records, pa-
pers, or documents may be destroyed or otherwise
disposed of as the Federal banking agency may di-
rect.’’.
SEC. 606. CLARIFICATION OF EXTENT OF SUSPENSION, RE-
MOVAL, AND PROHIBITION AUTHORITY OF
FEDERAL BANKING AGENCIES IN CASES OF
CERTAIN CRIMES BY INSTITUTION-AFFILI-
ATED PARTIES.
(a) INSURED DEPOSITORY INSTITUTION.—
(1) IN GENERAL.—Section 8(g)(1) of the Fed-
eral Deposit Insurance Act (12 U.S.C. 1818(g)(1))
is amended—
(A) in subparagraph (A), by striking ‘‘the
depository’’ each place such term appears and
inserting ‘‘any depository’’;
(B) in subparagraph (B)(i), by inserting
‘‘of which the subject of the order is an institu-
tion-affiliated party’’ before the period at the
end;
(C) in subparagraph (C), by striking ‘‘the
depository’’ each place such term appears and
inserting ‘‘any depository’’;
(D) in subparagraph (D)(i), by inserting
‘‘of which the subject of the order is an institu-
tion-affiliated party’’ after ‘‘upon the depository
institution’’; and
(E) by adding at the end the following new
subparagraph:
‘‘(E) CONTINUATION
OF
AUTHORITY.—A
Federal banking agency may issue an order
under this paragraph with respect to an indi-
vidual who is an institution-affiliated party at a
depository institution at the time of an offense
described in subparagraph (A) without regard
to—
‘‘(i) whether such individual is an in-
stitution-affiliated party at any depository
institution at the time the order is consid-
ered or issued by the agency; or
‘‘(ii) whether the depository institu-
tion at which the individual was an institu-
tion-affiliated party at the time of the of-
fense remains in existence at the time the
order is considered or issued by the agen-
cy.’’.
(2) CLERICAL
AMENDMENT.—Section 8(g) of
the Federal Deposit Insurance Act (12 U.S.C.
1818(g)) is amended by striking ‘‘(g)’’ and inserting
the following new subsection heading:
‘‘(g) SUSPENSION, REMOVAL, AND
PROHIBITION
FROM PARTICIPATION ORDERS IN THE CASE OF CERTAIN
CRIMINAL OFFENSES.—’’.
(b) INSURED CREDIT UNIONS.—
(1) IN
GENERAL.—Section 206(i)(1) of the
Federal Credit Union Act (12 U.S.C. 1786(i)(1)) is
amended—
(A) in subparagraph (A), by striking ‘‘the
credit union’’ each place such term appears and
inserting ‘‘any credit union’’;
(B) in subparagraph (B)(i), by inserting
‘‘of which the subject of the order is, or most
recently was, an institution-affiliated party’’ be-
fore the period at the end;
(C) in subparagraph (C), by striking ‘‘the
credit union’’ each place such term appears and
inserting ‘‘any credit union’’;
(D) in subparagraph (D)(i), by striking
‘‘upon such credit union’’ and inserting ‘‘upon
the credit union of which the subject of the
order is, or most recently was, an institution-af-
filiated party’’; and
(E) by adding at the end the following new
subparagraph:
‘‘(E) CONTINUATION OF AUTHORITY.—The
Board may issue an order under this paragraph
with respect to an individual who is an institu-
tion-affiliated party at a credit union at the
time of an offense described in subparagraph
(A) without regard to—
‘‘(i) whether such individual is an in-
stitution-affiliated party at any credit
union at the time the order is considered
or issued by the Board; or
‘‘(ii) whether the credit union at
which the individual was an institution-af-
filiated party at the time of the offense re-
mains in existence at the time the order is
considered or issued by the Board.’’.
(2) CLERICAL AMENDMENT.—Section 206(i) of
the Federal Credit Union Act (12 U.S.C. 1786(i)) is
amended by striking ‘‘(i)’’ at the beginning and in-
serting the following new subsection heading:
‘‘(i) SUSPENSION, REMOVAL, AND
PROHIBITION
FROM PARTICIPATION ORDERS IN THE CASE OF CERTAIN
CRIMINAL OFFENSES.—’’.
SEC. 607. STREAMLINING DEPOSITORY INSTITUTION MERG-
ER APPLICATION REQUIREMENTS.
(a) IN GENERAL.—Paragraph (4) of section 18(c) of
the Federal Deposit Insurance Act (12 U.S.C. 1828(c))
is amended to read as follows:
‘‘(4) REPORTS ON COMPETITIVE FACTORS.—
‘‘(A) REQUEST FOR REPORT.—In the in-
terests of uniform standards, before acting on
any application for approval of a merger trans-
action, the responsible agency, unless the agen-
cy finds that it must act immediately in order
to prevent the probable failure of a depository
institution involved, shall—
‘‘(i) request a report on the competi-
tive factors involved from the Attorney
General; and
‘‘(ii) provide a copy of the request to
the Corporation (when the Corporation is
not the responsible agency).
‘‘(B) FURNISHING OF REPORT.—The re-
port requested under subparagraph (A) shall be
furnished by the Attorney General to the re-
sponsible agency—
‘‘(i) not more than 30 calendar days
after the date on which the Attorney Gen-
eral received the request; or
‘‘(ii) not more than 10 calendar days
after such date, if the requesting agency
advises the Attorney General that an emer-
gency exists requiring expeditious action.’’.
(b) TECHNICAL AND CONFORMING AMENDMENT.—
The penultimate sentence of section 18(c)(6) of the Fed-
eral Deposit Insurance Act (12 U.S.C. 1828(c)(6)) is
amended to read as follows: ‘‘If the agency has advised
the Attorney General under paragraph (4)(B) of the exist-
ence of an emergency requiring expeditious action and has
requested a report on the competitive factors within 10
days, the transaction may not be consummated before the
fifth calendar day after the date of approval by the agen-
cy.’’.
SEC. 608. INCLUSION OF DIRECTOR OF THE OFFICE OF
THRIFT SUPERVISION IN LIST OF BANKING
AGENCIES 
REGARDING 
INSURANCE 
CUS-
TOMER PROTECTION REGULATIONS.
Section 47(g)(2)(B)(i) of the Federal Deposit Insur-
ance Act (12 U.S.C. 1831x(g)(2)(B)(i)) is amended by in-
serting ‘‘the Director of the Office of Thrift Supervision,’’
after ‘‘Comptroller of the Currency,’’.
SEC. 609. PROTECTION OF CONFIDENTIAL INFORMATION
RECEIVED 
BY 
FEDERAL 
BANKING 
REGU-
LATORS FROM FOREIGN BANKING SUPER-
VISORS.
Section 15 of the International Banking Act of 1978
(12 U.S.C. 3109) is amended by adding at the end the
following new subsection:
‘‘(c) CONFIDENTIAL INFORMATION RECEIVED FROM
FOREIGN SUPERVISORS.—
‘‘(1) IN
GENERAL.—Except as provided in
paragraph (3), a Federal banking agency may not be
compelled to disclose information received from a
foreign regulatory or supervisory authority if—
‘‘(A) the foreign regulatory or supervisory
authority has, in good faith, determined and
represented to such Federal banking agency
that public disclosure of the information would
violate the laws applicable to that foreign regu-
latory or supervisory authority; and
‘‘(B) the relevant Federal banking agency
obtained such information pursuant to—
‘‘(i) such procedures as the Federal
banking agency may establish for use in
connection with the administration and en-
forcement of Federal banking laws; or
‘‘(ii) a memorandum of understanding
or other similar arrangement between the
Federal banking agency and the foreign
regulatory or supervisory authority.
‘‘(2) TREATMENT
UNDER
TITLE
5, UNITED
STATES CODE.—For purposes of section 552 of title
5, United States Code, this subsection shall be treat-
ed as a statute described in subsection (b)(3)(B) of
such section.
‘‘(3) SAVINGS PROVISION.—No provision of this
section shall be construed as—
‘‘(A) authorizing any Federal banking
agency to withhold any information from any
duly authorized committee of the House of Rep-
resentatives or the Senate; or
‘‘(B) preventing any Federal banking
agency from complying with an order of a court
of the United States in an action commenced by
the United States or such agency.
‘‘(4) FEDERAL BANKING AGENCY DEFINED.—
For purposes of this subsection, the term ‘Federal
banking agency’ means the Board, the Comptroller,
the Federal Deposit Insurance Corporation, and the
Director of the Office of Thrift Supervision.’’.
SEC. 610. PROHIBITION ON PARTICIPATION BY CONVICTED
INDIVIDUAL.
Section 19 of the Federal Deposit Insurance Act (12
U.S.C. 1829) is amended by inserting after subsection (c)
(as added by section 603 of this title) the following new
subsections:
‘‘(d) BANK HOLDING COMPANIES.—Subsections (a)
and (b) shall apply to any bank holding company, any sub-
sidiary (other than a bank) of a bank holding company,
and any organization organized and operated under sec-
tion 25A of the Federal Reserve Act or operating under
section 25 of the Federal Reserve Act as if such bank
holding company, subsidiary, or organization were an in-
sured depository institution, except such subsections shall
be applied for purposes of this subsection by substituting
‘Board of Governors of the Federal Reserve System’ for
‘Corporation’ each place such term appears in such sub-
sections.
‘‘(e) SAVINGS AND LOAN HOLDING COMPANIES.—
Subsections (a) and (b) shall apply to any savings and
loan holding company and any subsidiary (other than a
savings association) of a savings and loan holding com-
pany as if such savings and loan holding company or sub-
sidiary were an insured depository institution, except such
subsections shall be applied for purposes of this subsection
by substituting ‘Director of the Office of Thrift Super-
vision’ for ‘Corporation’ each place such term appears in
such subsections.’’.
SEC. 611. CLARIFICATION THAT NOTICE AFTER SEPARA-
TION FROM SERVICE MAY BE MADE BY AN
ORDER.
(a) IN GENERAL.—Section 8(i)(3) of the Federal De-
posit Insurance Act (12 U.S.C. 1818(i)(3)) is amended by
inserting ‘‘or order’’ after ‘‘notice’’ each place such term
appears.
(b) TECHNICAL AND CONFORMING AMENDMENT.—
The heading for section 8(i)(3) of the Federal Deposit In-
surance Act (12 U.S.C. 1818(i)(3)) is amended by insert-
ing ‘‘OR ORDER’’ after ‘‘NOTICE’’.
SEC. 612. ENFORCEMENT AGAINST MISREPRESENTATIONS
REGARDING FDIC DEPOSIT INSURANCE COV-
ERAGE.
(a) IN GENERAL.—Section 18(a) of the Federal De-
posit Insurance Act (12 U.S.C. 1828(a)) is amended by
adding at the end the following new paragraph:
‘‘(4) FALSE
ADVERTISING, MISUSE
OF
FDIC
NAMES, AND MISREPRESENTATION TO INDICATE IN-
SURED STATUS.—
‘‘(A) PROHIBITION
ON
FALSE
ADVER-
TISING AND MISUSE OF FDIC NAMES.—No per-
son may—
‘‘(i) use the terms ‘Federal Deposit’,
‘Federal Deposit Insurance’, ‘Federal De-
posit Insurance Corporation’, any combina-
tion of such terms, or the abbreviation
‘FDIC’ as part of the business name or
firm name of any person, including any
corporation, partnership, business trust,
association, or other business entity; or
‘‘(ii) use such terms or any other sign
or symbol as part of an advertisement, so-
licitation, or other document,
to represent, suggest or imply that any deposit
liability, obligation, certificate or share is in-
sured or guaranteed by the Federal Deposit In-
surance Corporation, if such deposit liability,
obligation, certificate, or share is not insured or
guaranteed by the Corporation.
‘‘(B) PROHIBITION
ON
MISREPRESENTA-
TIONS OF INSURED STATUS.—No person may
knowingly misrepresent—
‘‘(i) that any deposit liability, obliga-
tion, certificate, or share is federally in-
sured, if such deposit liability, obligation,
certificate, or share is not insured by the
Corporation; or
‘‘(ii) the extent to which or the man-
ner in which any deposit liability, obliga-
tion, certificate, or share is insured by the
Federal Deposit Insurance Corporation, if
such deposit liability, obligation, certificate,
or share is not insured by the Corporation
to the extent or in the manner represented.
‘‘(C) AUTHORITY OF FDIC.—The Corpora-
tion shall have—
‘‘(i) jurisdiction over any person that
violates this paragraph, or aids or abets
the violation of this paragraph; and
‘‘(ii) for purposes of enforcing the re-
quirements of this paragraph with regard
to any person—
‘‘(I) the authority of the Cor-
poration under section 10(c) to con-
duct investigations; and
‘‘(II) the enforcement authority
of the Corporation under subsections
(b), (c), (d) and (i) of section 8,
as if such person were a state nonmember in-
sured bank.
‘‘(D) OTHER
ACTIONS
PRESERVED.—No
provision of this paragraph shall be construed
as barring any action otherwise available, under
the laws of the United States or any State, to
any Federal or State law enforcement agency or
individual.’’.
(b) ENFORCEMENT ORDERS.—Section 8(c) of the
Federal Deposit Insurance Act (12 U.S.C. 1818(c)) is
amended by adding at the end the following new para-
graph:
‘‘(4) FALSE
ADVERTISING
OR
MISUSE
OF
NAMES TO INDICATE INSURED STATUS.—
‘‘(A) TEMPORARY ORDER.—
‘‘(i) IN
GENERAL.—If a notice of
charges served under subsection (b)(1) of
this section specifies on the basis of par-
ticular facts that any person is engaged in
conduct described in section 18(a)(4), the
Corporation may issue a temporary order
requiring—
‘‘(I) the immediate cessation of
any activity or practice described,
which gave rise to the notice of
charges; and
‘‘(II) affirmative action to pre-
vent any further, or to remedy any ex-
isting, violation.
‘‘(ii) EFFECT OF ORDER.—Any tem-
porary order issued under this subpara-
graph shall take effect upon service.
‘‘(B) EFFECTIVE PERIOD OF TEMPORARY
ORDER.—A temporary order issued under sub-
paragraph (A) shall remain effective and en-
forceable, pending the completion of an admin-
istrative proceeding pursuant to subsection
(b)(1) in connection with the notice of
charges—
‘‘(i) until such time as the Corpora-
tion shall dismiss the charges specified in
such notice; or
‘‘(ii) if a cease-and-desist order is
issued against such person, until the effec-
tive date of such order.
‘‘(C) CIVIL MONEY PENALTIES.—Violations
of section 18(a)(4) shall be subject to civil
money penalties as set forth in subsection (i) in
an amount not to exceed $1,000,000 for each
day during which the violation occurs or con-
tinues.’’.
(c) TECHNICAL AND CONFORMING AMENDMENTS.—
(1) Section 18(a)(3) of the Federal Deposit In-
surance Act (12 U.S.C. 1828(a)) is amended—
(A) in the 1st sentence by striking ‘‘of this
subsection’’ and inserting ‘‘of paragraphs (1)
and (2)’’;
(B) by striking the 2nd sentence; and
(C) in the 3rd sentence, by striking ‘‘of
this subsection’’ and inserting ‘‘of paragraphs
(1) and (2)’’.
(2) The heading for subsection (a) of section 18
of the Federal Deposit Insurance Act (12 U.S.C.
1828(a)) is amended by striking ‘‘INSURANCE
LOGO.—’’ and inserting ‘‘REPRESENTATIONS OF DE-
POSIT INSURANCE.—’’.
SEC. 613. COMPENSATION OF FEDERAL HOME LOAN BANK
DIRECTORS.
Section 7(i) of the Federal Home Loan Bank Act (12
U.S.C. 1427(i)) is amended to read as follows:
‘‘(i) DIRECTORS’ COMPENSATION.—
‘‘(1) IN GENERAL.—Each Federal home loan
bank may pay the directors on the board of directors
of the bank reasonable compensation for the time re-
quired of such directors, and reasonable expenses in-
curred by the directors, in connection with service on
the board of directors, in accordance with resolutions
adopted by the board of directors and subject to the
approval of the board.
‘‘(2) ANNUAL REPORT BY THE BOARD.—Infor-
mation regarding compensation and expenses paid
by the Federal home loan banks to the directors on
the boards of directors of the banks shall be included
in the annual report submitted to the Congress by
the Board pursuant to section 2B(d).’’.
SEC. 614. EXTENSION OF TERMS OF FEDERAL HOME LOAN
BANK DIRECTORS.
(a) IN GENERAL.—Section 7(d) of the Federal Home
Loan Bank Act (12 U.S.C. 1427(d)) is amended—
(1) in the first sentence, by striking ‘‘3 years’’
and inserting ‘‘4 years’’; and
(2) in the 2nd sentence—
(A) by striking ‘‘Federal Home Loan Bank
System Modernization Act of 1999’’ and insert-
ing ‘‘Financial Services Regulatory Relief Act
of 2003’’; and
(B) by striking ‘‘1/3’’ and inserting ‘‘1/4’’.
(b) PROSPECTIVE APPLICATION.—The amendment
made by subsection (a) shall not apply to the term of office
in which any director of a Federal home loan bank is serv-
ing as of the date of the enactment of this Act, including
any director elected or appointed to fill a vacancy in any
such term of office.
SEC. 615. BIENNIAL REPORTS ON THE STATUS OF AGENCY
EMPLOYMENT OF MINORITIES AND WOMEN.
(a) IN GENERAL.—Before December 31, 2003, and
the end of each 2-year period beginning after such date,
each Federal banking agency shall submit a report to the
Congress on the status of the employment by the agency
of minority individuals and women.
(b) FACTORS TO BE INCLUDED.—The report shall
include a detailed assessment of each of the following:
(1) The extent of hiring of minority individuals
and women by the agency as of the time the report
is prepared.
(2) The successes achieved and challenges faced
by the agency in operating minority and women out-
reach programs.
(3) Challenges the agency may face in finding
qualified minority individual and women applicants.
(4) Such other information, findings, and con-
clusions, and recommendations for legislative or
agency action, as the agency may determine to be
appropriate to include in the report.
(c) DEFINITIONS.—For purposes of this section, the
following definitions shall apply:
(1) FEDERAL
BANKING
AGENCY.—The term
‘‘Federal banking agency’’—
(A) has the same meaning as in section
3(z) of the Federal Deposit Insurance Act; and
(B) includes the National Credit Union
Administration.
(2) MINORITY.—The term ‘‘minority’’ has the
same meaning as in section 1204(c)(3) of the Finan-
cial Institutions Reform, Recovery, and Enforcement
Act of 1989.
SEC. 616. COORDINATION OF STATE EXAMINATION AU-
THORITY.
Section 10(h) of the Federal Deposit Insurance Act
(12 U.S.C. 1820(h)) is amended to read as follows:
‘‘(h) COORDINATION
OF EXAMINATION AUTHOR-
ITY.—
‘‘(1) IN
GENERAL.—The appropriate State
bank supervisor of the home State of an insured
State bank has authority to examine and supervise
the bank. The State bank supervisor of the home
State of an insured State bank shall exercise its au-
thority to supervise and examine the branches of the
bank in a host State in accordance with the terms
of any applicable cooperative agreement between the
home State bank supervisor and the State bank su-
pervisor of the relevant host State. Except as ex-
pressly provided in a cooperative agreement between
the State bank supervisors of the home State and
host State(s) of an insured State bank, only the
State bank supervisor of the home State of an in-
sured State bank may levy or charge State super-
visory fees on the bank.
‘‘(2) HOST STATE EXAMINATION.—With respect
to a branch operated in a host State by an out-of-
State insured State bank that resulted from an
interstate merger transaction approved under section
44 or that was established in such State pursuant
to section 5155(g) of the Revised Statutes, the third
undesignated paragraph of section 9 of the Federal
Reserve Act or section 18(d)(4) of this Act, the ap-
propriate State bank supervisor of such host State
may—
‘‘(A) with written notice to the State bank
supervisor of the bank’s home State and subject
to the terms of any applicable cooperative
agreement with the State bank supervisor of
such home State, examine such branch for the
purpose of determining compliance with host
State laws that are applicable pursuant to sec-
tion 24(j) of this Act, including those that gov-
ern community reinvestment, fair lending, and
consumer protection; and
‘‘(B) if expressly permitted under and sub-
ject to the terms of a cooperative agreement
with the State bank supervisor of the bank’s
home State or if such out-of-State insured
State bank has been determined to be in a trou-
bled condition by either the State bank super-
visor of the bank’s home State or the bank’s
appropriate Federal banking agency, participate
in the examination of the bank by the State
bank supervisor of the bank’s home State to as-
certain that the activities of the branch in such
host State are not conducted in an unsafe or
unsound manner. The State bank supervisor of
the home State of an insured State bank shall
notify the State bank supervisor of each host
State of the bank if there has been a final de-
termination that the bank is in a troubled con-
dition. The State bank supervisor of the bank’s
home State shall provide such notice as soon as
reasonably possible but in all cases within 15
business days after the State bank supervisor
has made such final determination or has re-
ceived written notification of such final deter-
mination.
100
‘‘(3) HOST STATE ENFORCEMENT.—If the State
bank supervisor of a host State determines that a
branch of an out-of-State State insured State bank
is violating any law of the host State that is applica-
ble to such branch pursuant to section 24(j) of this
Act, including a law that governs community rein-
vestment, fair lending, or consumer protection, the
State bank supervisor of the host State or, to the ex-
tent authorized by the law of the host State, a host
State law enforcement officer may, with written no-
tice to the State bank supervisor of the bank’s home
State and subject to the terms of any applicable co-
operative agreement with the State bank supervisor
of the bank’s home State, undertake such enforce-
ment actions and proceedings as would be permitted
under the law of the host State as if the branch
were a bank chartered by that host State.
‘‘(4) COOPERATIVE
AGREEMENT.—The State
bank supervisors from 2 or more States may enter
into cooperative agreements to facilitate State regu-
latory supervision of State banks, including coopera-
tive agreements relating to the coordination of ex-
aminations and joint participation in examinations.
For purposes of this subsection (h), the term ‘‘coop-
erative agreement’’ means a written agreement that
101
is signed by the home State bank supervisor and
host State bank supervisor to facilitate State regu-
latory supervision of State banks and includes na-
tionwide or multi-state cooperative agreements and
cooperative agreements solely between the home
State and host State. Except for State bank super-
visors, no provision of this subsection (h) relating to
such cooperative agreements shall be construed as
limiting in any way the authority of home and host
State law enforcement officers, regulatory super-
visors, or other officials that have not signed such
cooperative agreements to enforce host State laws
that are applicable to a branch of an out-of-State in-
sured State bank located in the host State pursuant
to section 24(j) of this Act.
‘‘(5) FEDERAL REGULATORY AUTHORITY.—No
provision of this subsection shall be construed as
limiting in any way the authority of any Federal
banking agency.
‘‘(6) STATE
TAXATION
AUTHORITY
NOT
AF-
FECTED.—No provision of this subsection (h) shall
be construed as affecting the authority of any State
or political subdivision of any State to adopt, apply,
or administer any tax or method of taxation to any
bank, bank holding company, or foreign bank, or
102
any affiliate of any bank, bank holding company, or
foreign bank, to the extent such tax or tax method
is otherwise permissible by or under the Constitution
of the United States or other Federal law.
‘‘(7) DEFINITIONS.—For purpose of this sec-
tion, the following definition shall apply:
‘‘(A) The terms ‘host State’, ‘home State’,
and ‘out-of-State bank’ have the same meanings
as in section 44(g).
‘‘(B) The term ‘State supervisory fees’
means assessments, examination fees, branch
fees, license fees, and all other fees that are lev-
ied or charged by a State bank supervisor di-
rectly upon an insured State bank or upon
branches of an insured State bank.
‘‘(C) Solely for purposes of subparagraph
(2)(B) of this subsection (h), an insured State
bank has been determined to be in ‘troubled
condition’ if the bank—
‘‘(i) has a composite rating, as deter-
mined in its most recent report of exam-
ination, of 4 or 5 under the Uniform Fi-
nancial 
Institutions 
Ratings 
System
(UFIRS); or
103
‘‘(ii) is subject to a proceeding initi-
ated by the Corporation for termination or
suspension of deposit insurance; or
‘‘(iii) is subject to a proceeding initi-
ated by the State bank supervisor of the
bank’s home State to vacate, revoke, or
terminate the charter of the bank, or to
liquidate the bank, or to appoint a receiver
for the bank.
‘‘(D) For the purposes of paragraph
(2)(B), the term ‘final determination’ means
the transmittal of a Report of Examination to
the bank or transmittal of official notice of pro-
ceedings to the bank.’’.
TITLE VII—BUSINESS CHECKING
FREEDOM
SEC. 701. SHORT TITLE.
This title may be cited as the ‘‘Business Checking
Freedom Act of 2004’’.
SEC. 702. INTEREST-BEARING TRANSACTION ACCOUNTS
AUTHORIZED FOR ALL BUSINESSES.
(a) Section 2 of Public Law 93–100 (12 U.S.C. 1832)
is amended—
(1) by redesignating subsections (b) and (c) as
subsections (c) and (d), respectively; and
104
(2) by inserting after subsection (a) the fol-
lowing:
‘‘(b) Notwithstanding any other provision of law, any
depository institution may permit the owner of any deposit
or account which is a deposit or account on which interest
or dividends are paid and is not a deposit or account de-
scribed in subsection (a)(2) to make up to 24 transfers
per month (or such greater number as the Board of Gov-
ernors of the Federal Reserve System may determine by
rule or order), for any purpose, to another account of the
owner in the same institution. An account offered pursu-
ant to this subsection shall be considered a transaction
account for purposes of section 19 of the Federal Reserve
Act unless the Board of Governors of the Federal Reserve
System determines otherwise.’’.
(b) Effective at the end of the 2-year period begin-
ning on the date of the enactment of this Act, section 2
of Public Law 93–100 (12 U.S.C. 1832) is amended—
(1) in subsection (a)(1), by striking ‘‘but sub-
ject to paragraph (2)’’;
(2) by striking paragraph (2) of subsection (a)
and inserting the following new paragraph:
‘‘(2) No provision of this section may be con-
strued as conferring the authority to offer demand
105
deposit accounts to any institution that is prohibited
by law from offering demand deposit accounts.’’; and
(3) in subsection (b) (as added by subsection
(a) of this section) by striking ‘‘and is not a deposit
or account described in subsection (a)(2)’’.
SEC. 703. INTEREST-BEARING TRANSACTION ACCOUNTS
AUTHORIZED.
(a) REPEAL OF PROHIBITION ON PAYMENT OF IN-
TEREST ON DEMAND DEPOSITS.—
(1) FEDERAL RESERVE ACT.—Section 19(i) of
the Federal Reserve Act (12 U.S.C. 371a) is amend-
ed to read as follows:
‘‘(i) [Repealed]’’.
(2) HOME OWNERS’ LOAN ACT.—The first sen-
tence of section 5(b)(1)(B) of the Home Owners’
Loan Act (12 U.S.C. 1464(b)(1)(B)) is amended by
striking ‘‘savings association may not—’’ and all
that follows through ‘‘(ii) permit any’’ and inserting
‘‘savings association may not permit any’’.
(3) FEDERAL DEPOSIT INSURANCE ACT.—Sec-
tion 18(g) of the Federal Deposit Insurance Act (12
U.S.C. 1828(g)) is amended to read as follows:
‘‘(g) [Repealed]’’.
106
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) shall take effect at the end of the 2-year
period beginning on the date of the enactment of this Act.
SEC. 704. PAYMENT OF INTEREST ON RESERVES AT FED-
ERAL RESERVE BANKS.
(a) IN GENERAL.—Section 19(b) of the Federal Re-
serve Act (12 U.S.C. 461(b)) is amended by adding at
the end the following new paragraph:
‘‘(12) EARNINGS ON RESERVES.—
‘‘(A) IN GENERAL.—Balances maintained
at a Federal reserve bank by or on behalf of a
depository institution may receive earnings to
be paid by the Federal reserve bank at least
once each calendar quarter at a rate or rates
not to exceed the general level of short-term in-
terest rates.
‘‘(B) REGULATIONS
RELATING
TO
PAY-
MENTS AND DISTRIBUTION.—The Board may
prescribe regulations concerning—
‘‘(i) the payment of earnings in ac-
cordance with this paragraph;
‘‘(ii) the distribution of such earnings
to the depository institutions which main-
tain balances at such banks or on whose
behalf such balances are maintained; and
107
‘‘(iii) the responsibilities of depository
institutions, Federal home loan banks, and
the National Credit Union Administration
Central Liquidity Facility with respect to
the crediting and distribution of earnings
attributable to balances maintained, in ac-
cordance with subsection (c)(1)(A), in a
Federal reserve bank by any such entity on
behalf of depository institutions.
‘‘(C) 
DEPOSITORY
INSTITUTIONS
DE-
FINED.—For purposes of this paragraph, the
term ‘depository institution’, in addition to the
institutions described in paragraph (1)(A), in-
cludes any trust company, corporation orga-
nized under section 25A or having an agree-
ment with the Board under section 25, or any
branch or agency of a foreign bank (as defined
in section 1(b) of the International Banking Act
of 1978).’’.
(b) AUTHORIZATION FOR PASS THROUGH RESERVES
FOR MEMBER BANKS.—Section 19(c)(1)(B) of the Fed-
eral Reserve Act (12 U.S.C. 461(c)(1)(B)) is amended by
striking ‘‘which is not a member bank’’.
(c) CONSUMER BANKING COSTS ASSESSMENT.—
108
(1) IN
GENERAL.—The Federal Reserve Act
(12 U.S.C. 221 et seq.) is amended—
(A) by redesignating sections 30 and 31 as
sections 31 and 32, respectively; and
(B) by inserting after section 29 the fol-
lowing new section:
‘‘SEC. 30. SURVEY OF BANK FEES AND SERVICES.
‘‘(a) ANNUAL SURVEY REQUIRED.—The Board of
Governors of the Federal Reserve System shall obtain an-
nually a sample, which is representative by type and size
of the institution (including small institutions) and geo-
graphic location, of the following retail banking services
and products provided by insured depository institutions
and insured credit unions (along with related fees and
minimum balances):
‘‘(1) Checking and other transaction accounts.
‘‘(2) Negotiable order of withdrawal and sav-
ings accounts.
‘‘(3) Automated teller machine transactions.
‘‘(4) Other electronic transactions.
‘‘(b) MINIMUM SURVEY REQUIREMENT.—The annual
survey described in subsection (a) shall meet the following
minimum requirements:
109
‘‘(1) CHECKING AND OTHER TRANSACTION AC-
COUNTS.—Data on checking and transaction ac-
counts shall include, at a minimum, the following:
‘‘(A) Monthly and annual fees and min-
imum balances to avoid such fees.
‘‘(B) Minimum opening balances.
‘‘(C) Check processing fees.
‘‘(D) Check printing fees.
‘‘(E) Balance inquiry fees.
‘‘(F) Fees imposed for using a teller or
other institution employee.
‘‘(G) Stop payment order fees.
‘‘(H) Nonsufficient fund fees.
‘‘(I) Overdraft fees.
‘‘(J) Deposit items returned fees.
‘‘(K) Availability of no-cost or low-cost ac-
counts for consumers who maintain low
balances.
‘‘(2) NEGOTIABLE ORDER OF WITHDRAWAL AC-
COUNTS AND SAVINGS ACCOUNTS.—Data on nego-
tiable order of withdrawal accounts and savings ac-
counts shall include, at a minimum, the following:
‘‘(A) Monthly and annual fees and min-
imum balances to avoid such fees.
‘‘(B) Minimum opening balances.
110
‘‘(C) Rate at which interest is paid to con-
sumers.
‘‘(D) Check processing fees for negotiable
order of withdrawal accounts.
‘‘(E) Fees imposed for using a teller or
other institution employee.
‘‘(F) Availability of no-cost or low-cost ac-
counts for consumers who maintain low
balances.
‘‘(3) AUTOMATED
TELLER
TRANSACTIONS.—
Data on automated teller machine transactions shall
include, at a minimum, the following:
‘‘(A) Monthly and annual fees.
‘‘(B) Card fees.
‘‘(C) Fees charged to customers for with-
drawals, deposits, and balance inquiries through
institution-owned machines.
‘‘(D) Fees charged to customers for with-
drawals, deposits, and balance inquiries through
machines owned by others.
‘‘(E) Fees charged to noncustomers for
withdrawals, deposits, and balance inquiries
through institution-owned machines.
‘‘(F) Point-of-sale transaction fees.
111
‘‘(4) OTHER
ELECTRONIC
TRANSACTIONS.—
Data on other electronic transactions shall include,
at a minimum, the following:
‘‘(A) Wire transfer fees.
‘‘(B) Fees related to payments made over
the Internet or through other electronic means.
‘‘(5) OTHER
FEES
AND
CHARGES.—Data on
any other fees and charges that the Board of Gov-
ernors of the Federal Reserve System determines to
be appropriate to meet the purposes of this section.
‘‘(6) FEDERAL RESERVE BOARD AUTHORITY.—
The Board of Governors of the Federal Reserve Sys-
tem may cease the collection of information with re-
gard to any particular fee or charge specified in this
subsection if the Board makes a determination that,
on the basis of changing practices in the financial
services industry, the collection of such information
is no longer necessary to accomplish the purposes of
this section.
‘‘(c) ANNUAL REPORT TO CONGRESS REQUIRED.—
‘‘(1) PREPARATION.—The Board of Governors
of the Federal Reserve System shall prepare a report
of the results of each survey conducted pursuant to
subsections (a) and (b) of this section and section
136(b)(1) of the Consumer Credit Protection Act.
112
‘‘(2) CONTENTS OF THE REPORT.—In addition
to the data required to be collected pursuant to sub-
sections (a) and (b), each report prepared pursuant
to paragraph (1) shall include a description of any
discernible trend, in the Nation as a whole, in a rep-
resentative sample of the 50 States (selected with
due regard for regional differences), and in each
consolidated metropolitan statistical area (as defined
by the Director of the Office of Management and
Budget), in the cost and availability of the retail
banking services, including those described in sub-
sections (a) and (b) (including related fees and min-
imum balances), that delineates differences between
institutions on the basis of the type of institution
and the size of the institution, between large and
small institutions of the same type, and any engage-
ment of the institution in multistate activity.
‘‘(3) SUBMISSION TO CONGRESS.—The Board
of Governors of the Federal Reserve System shall
submit an annual report to the Congress not later
than June 1, 2005, and not later than June 1 of
each subsequent year.
‘‘(d) DEFINITIONS.—For purposes of this section, the
term ‘insured depository institution’ has the meaning
given such term in section 3 of the Federal Deposit Insur-
113
ance Act, and the term ‘insured credit union’ has the
meaning given such term in section 101 of the Federal
Credit Union Act.’’.
(2) CONFORMING AMENDMENT.—
(A) IN GENERAL.—Paragraph (1) of sec-
tion 136(b) of the Truth in Lending Act (15
U.S.C. 1646(b)(1)) is amended to read as fol-
lows:
‘‘(1) COLLECTION REQUIRED.—The Board shall
collect, on a semiannual basis, from a broad sample
of financial institutions which offer credit card serv-
ices, credit card price and availability information
including—
‘‘(A) the information required to be dis-
closed under section 127(c) of this chapter;
‘‘(B) the average total amount of finance
charges paid by consumers; and
‘‘(C) the following credit card rates and
fees:
‘‘(i) Application fees.
‘‘(ii) Annual percentage rates for cash
advances and balance transfers.
‘‘(iii) Maximum annual percentage
rate that may be charged when an account
is in default.
114
‘‘(iv) Fees for the use of convenience
checks.
‘‘(v) Fees for balance transfers.
‘‘(vi) Fees for foreign currency con-
versions.’’.
(B) EFFECTIVE
DATE.—The amendment
made by subparagraph (A) shall take effect on
January 1, 2004.
(3) REPEAL OF OTHER REPORT PROVISIONS.—
Section 1002 of Financial Institutions Reform, Re-
covery, and Enforcement Act of 1989 and section
108 of the Riegle-Neal Interstate Banking and
Branching Efficiency Act of 1994 are hereby re-
pealed.
(d) TECHNICAL AND CONFORMING AMENDMENTS.—
Section 19 of the Federal Reserve Act (12 U.S.C. 461)
is amended—
(1) in subsection (b)(4) (12 U.S.C. 461(b)(4)),
by striking subparagraph (C) and redesignating sub-
paragraphs (D) and (E) as subparagraphs (C) and
(D), respectively; and
(2) 
in 
subsection 
(c)(1)(A) 
(12 
U.S.C.
461(c)(1)(A)), by striking ‘‘subsection (b)(4)(C)’’
and inserting ‘‘subsection (b)’’.
115
SEC. 705. INCREASED FEDERAL RESERVE BOARD FLEXI-
BILITY 
IN 
SETTING 
RESERVE 
REQUIRE-
MENTS.
Section 19(b)(2)(A) of the Federal Reserve Act (12
U.S.C. 461(b)(2)(A)) is amended—
(1) in clause (i), by striking ‘‘the ratio of 3 per
centum’’ and inserting ‘‘a ratio not greater than 3
percent (and which may be zero)’’; and
(2) in clause (ii), by striking ‘‘and not less than
8 per centum,’’ and inserting ‘‘(and which may be
zero),’’.
SEC. 706. TRANSFER OF FEDERAL RESERVE SURPLUSES.
(a) IN GENERAL.—Section 7(b) of the Federal Re-
serve Act (12 U.S.C. 289(b)) is amended by adding at
the end the following new paragraph:
‘‘(4) ADDITIONAL
TRANSFERS
TO
COVER
IN-
TEREST
PAYMENTS
FOR
FISCAL
YEARS
2003
THROUGH 2007.—
‘‘(A) IN
GENERAL.—In addition to the
amounts required to be transferred from the
surplus funds of the Federal reserve banks pur-
suant to subsection (a)(3), the Federal reserve
banks shall transfer from such surplus funds to
the Board of Governors of the Federal Reserve
System for transfer to the Secretary of the
Treasury for deposit in the general fund of the