I 
111TH CONGRESS 
2D SESSION 
H. R. 4884 
To establish a covered bond regulatory oversight program, and for other 
purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 18, 2010 
Mr. GARRETT of New Jersey (for himself, Mr. KANJORSKI, and Mr. BACHUS) 
introduced the following bill; which was referred to the Committee on Fi-
nancial Services, and in addition to the Committee on Ways and Means, 
for a period to be subsequently determined by the Speaker, in each case 
for consideration of such provisions as fall within the jurisdiction of the 
committee concerned 
A BILL 
To establish a covered bond regulatory oversight program, 
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 ‘‘United States Covered 
Bond Act of 2010’’. 
SEC. 2. DEFINITIONS. 
For purposes of this Act, the following definitions 
shall apply: 
VerDate Nov 24 2008 
03:33 Mar 19, 2010
Jkt 089200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6201
E:\BILLS\H4884.IH
H4884
smartinez on DSKB9S0YB1PROD with BILLS
(B) substitute assets, without limitation; 
and 
(C) ancillary assets, without limitation. 
(4) COVERED
BOND.—The term ‘‘covered 
bond’’ means any senior recourse debt obligation of 
an eligible issuer that— 
(A) has an original term to maturity of not 
less than 1 year; 
(B) is secured directly or indirectly by a 
perfected security interest in a cover pool which 
is owned directly or indirectly by the issuer of 
the obligation; 
(C) is issued under a covered bond pro-
gram that has been approved by the covered 
bond regulator and is identified in a register of 
covered bonds maintained by the covered bond 
regulator; and 
(D) is not a deposit (as defined in section 
3 of the Federal Deposit Insurance Act). 
(5) COVERED
BOND
PROGRAM.—The term 
‘‘covered bond program’’ means any of the programs 
of an eligible issuer under which, on the security of 
a single cover pool, 1 or more series or tranches of 
covered bonds may be issued. 
VerDate Nov 24 2008 
03:33 Mar 19, 2010
Jkt 089200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H4884.IH
H4884
smartinez on DSKB9S0YB1PROD with BILLS
(6) COVERED
BOND
REGULATOR.—The term 
‘‘covered bond regulator’’ means the Secretary of the 
Treasury or any officer of the Department of the 
Treasury designated by the Secretary for purposes 
of this Act. 
(7) ELIGIBLE
ASSET.—The term ‘‘eligible 
asset’’ means any of the following assets within a 
particular eligible asset class: 
(A) In the case of the residential mortgage 
asset class— 
(i) any first-lien mortgage loan that is 
secured by 1-to-4 family residential prop-
erty and that is in compliance with super-
visory guidance applicable at the time of 
loan origination; 
(ii) any mortgage loan insured under 
the National Housing Act or any loan 
guaranteed, insured, or made under chap-
ter 37 of title 38, United States Code; and 
(iii) any residential mortgage-backed 
security of the highest investment grade 
that is backed by first-lien mortgage loans 
and any ancillary property (including any 
residential mortgage-backed security that 
is sponsored or issued by, or backed by 
VerDate Nov 24 2008 
03:33 Mar 19, 2010
Jkt 089200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H4884.IH
H4884
smartinez on DSKB9S0YB1PROD with BILLS
first-lien mortgage loans originated or ac-
quired by, the issuer of the covered bonds 
or any affiliate of such issuer), to the ex-
tent such securities do not exceed an 
amount equal to 20 percent of the out-
standing principal amount of the assets in 
a cover pool. 
(B) In the case of the home equity asset 
class— 
(i) any home equity loan that is se-
cured by 1-to-4 family residential property 
and that is in compliance with supervisory 
guidance applicable at the time of loan 
origination; and 
(ii) any asset-backed security of the 
highest investment grade that is backed by 
home equity loans and any ancillary prop-
erty (including any asset-backed security 
that is sponsored or issued by, or backed 
by home equity loans originated or ac-
quired by, the issuer of the covered bonds 
or any affiliate of such issuer), to the ex-
tent such securities do not exceed an 
amount equal to 20 percent of the out-
VerDate Nov 24 2008 
03:33 Mar 19, 2010
Jkt 089200
PO 00000
Frm 00005
Fmt 6652
Sfmt 6201
E:\BILLS\H4884.IH
H4884
smartinez on DSKB9S0YB1PROD with BILLS
standing principal amount of the assets in 
a cover pool. 
(C) In the case of the commercial mort-
gage asset class— 
(i) any commercial mortgage loan (in-
cluding any multifamily mortgage loan) 
that is in compliance with supervisory 
guidance applicable at the time of loan 
origination; and 
(ii) any commercial mortgage-backed 
security of the highest investment grade 
that is backed by commercial mortgage 
loans 
(including 
multifamily 
mortgage 
loans) and any ancillary property (includ-
ing any commercial mortgage-backed secu-
rity that is sponsored or issued by, or 
backed by commercial mortgage loans 
originated or acquired by, the issuer of the 
covered bonds or any affiliate of such 
issuer), to the extent such securities do not 
exceed an amount equal to 20 percent of 
the outstanding principal amount of the 
assets in a cover pool. 
(D) In the case of the public sector asset 
class— 
VerDate Nov 24 2008 
03:33 Mar 19, 2010
Jkt 089200
PO 00000
Frm 00006
Fmt 6652
Sfmt 6201
E:\BILLS\H4884.IH
H4884
smartinez on DSKB9S0YB1PROD with BILLS
(i) investment-grade securities issued 
by 1 or more States or municipalities; 
(ii) loans (excluding securities) made 
to 1 or more States or municipalities; and 
(iii) loans, securities, or other obliga-
tions that are insured or guaranteed, in 
full or substantially in full, by the full faith 
and credit of the United States (whether 
or not such loans, securities, or other obli-
gations are also part of another eligible 
asset class). 
(E) In the case of the auto asset class— 
(i) any auto loan or lease that is in 
compliance with supervisory guidance ap-
plicable at the time of loan or lease origi-
nation; and 
(ii) any asset-backed security of the 
highest investment grade that is backed by 
auto loans or leases and any ancillary 
property (including any asset-backed secu-
rity sponsored or issued by, or backed by 
loans or leases originated or acquired by, 
the issuer of the covered bonds or any af-
filiate of such issuer), to the extent such 
securities do not exceed an amount equal 
VerDate Nov 24 2008 
03:33 Mar 19, 2010
Jkt 089200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6201
E:\BILLS\H4884.IH
H4884
smartinez on DSKB9S0YB1PROD with BILLS
to 20 percent of the outstanding principal 
amount of the assets in a cover pool. 
(F) In the case of the student loan asset 
class— 
(i) any student loan (whether guaran-
teed or nonguaranteed) that is in compli-
ance with supervisory guidance applicable 
at the time of loan origination; and 
(ii) any asset-backed security of the 
highest investment grade that is backed by 
student loans and any ancillary property 
(including any asset-backed security spon-
sored or issued by, or backed by loans 
originated or acquired by, the issuer of the 
covered bonds or any affiliate of such 
issuer), to the extent such securities do not 
exceed an amount equal to 20 percent of 
the outstanding principal amount of the 
assets in a cover pool. 
(G) In the case of the credit or charge 
card asset class— 
(i) any credit or charge card loan that 
is in compliance with supervisory guidance 
applicable at the time of loan origination; 
and 
VerDate Nov 24 2008 
03:33 Mar 19, 2010
Jkt 089200
PO 00000
Frm 00008
Fmt 6652
Sfmt 6201
E:\BILLS\H4884.IH
H4884
smartinez on DSKB9S0YB1PROD with BILLS
(ii) any asset-backed security of the 
highest investment grade that is backed by 
credit or charge card loans and any ancil-
lary property (including any asset-backed 
security sponsored or issued by, or backed 
by loans originated or acquired by, the 
issuer of the covered bonds or any affiliate 
of such issuer), to the extent such securi-
ties do not exceed an amount equal to 20 
percent 
of 
the 
outstanding 
principal 
amount of the assets in a cover pool. 
(H) In the case of the small business asset 
class— 
(i) any loan made under a program 
established by the Small Business Admin-
istration (whether guaranteed or non-
guaranteed); and 
(ii) any asset-backed security of the 
highest investment grade that is backed by 
loans made under 1 or more programs es-
tablished by the Small Business Adminis-
tration and any ancillary property (includ-
ing any asset-backed security sponsored or 
issued by, or backed by loans originated or 
acquired by, the issuer of the covered 
VerDate Nov 24 2008 
03:33 Mar 19, 2010
Jkt 089200
PO 00000
Frm 00009
Fmt 6652
Sfmt 6201
E:\BILLS\H4884.IH
H4884
smartinez on DSKB9S0YB1PROD with BILLS