imum level for any relevant capital meas-
ure. 
(iv) 
CRITICALLY
UNDERCAPITAL-
IZED.—An 
identified 
financial 
holding 
company is ‘‘critically undercapitalized’’ if 
it fails to meet any level specified in para-
graph (4)(C)(i). 
(3) OTHER DEFINITIONS.— 
(A) AVERAGE.—The ‘‘average’’ of an ac-
counting item (such as total assets or tangible 
equity) during a given period means the sum of 
that item at the close of business on each busi-
ness day during that period divided by the total 
number of business days in that period. 
(B) CAPITAL
DISTRIBUTION.—The term 
‘‘capital distribution’’ means— 
(i) a distribution of cash or other 
property by an identified financial holding 
company to its owners made on account of 
that ownership, but not including any divi-
dend consisting only of shares of the iden-
tified financial holding company or rights 
to purchase such shares; 
(ii) a payment by an identified finan-
cial holding company to repurchase, re-
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deem, retire, or otherwise acquire any of 
its shares or other ownership interests, in-
cluding any extension of credit to finance 
any person’s acquisition of those shares or 
interests; or 
(iii) a transaction that the Board de-
termines, by order or regulation, to be in 
substance a distribution of capital to the 
owners of the identified financial holding 
company. 
(C) CAPITAL
RESTORATION
PLAN.—The 
term ‘‘capital restoration plan’’ means a plan 
submitted under paragraph (6)(B). 
(D) COMPENSATION.—The term ‘‘com-
pensation’’ includes any payment of money or 
provision of any other thing of value in consid-
eration of employment. 
(E) RELEVANT
CAPITAL
MEASURE.—The 
term ‘‘relevant capital measure’’ means the 
measures described in paragraph (4). 
(F) REQUIRED
MINIMUM
LEVEL.—The 
term ‘‘required minimum level’’ means, with re-
spect to each relevant capital measure, the min-
imum acceptable capital level specified by the 
Board by regulation. 
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(G) SENIOR
EXECUTIVE
OFFICER.—The 
term ‘‘senior executive officer’’ has the same 
meaning as the term ‘‘executive officer’’ in sec-
tion 22(h) of the Federal Reserve Act (12 
U.S.C. 375b). 
(4) CAPITAL STANDARDS.— 
(A) RELEVANT CAPITAL MEASURES.— 
(i) IN GENERAL.—Except as provided 
in clause (ii)(II), the capital standards pre-
scribed by the Board under subsection 6(c) 
of the Bank Holding Company Act of 1956 
(12 U.S.C. 1845(c)) shall include— 
(I) a leverage limit; and 
(II) a risk-based capital require-
ment. 
(ii) OTHER CAPITAL MEASURES.—The 
Board may by regulation— 
(I) establish any additional rel-
evant capital measures to carry out 
this section; or 
(II) rescind any relevant capital 
measure required under clause (i) 
upon determining that the measure is 
no longer an appropriate means for 
carrying out this section. 
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(B) CAPITAL CATEGORIES GENERALLY.— 
The Board shall, by regulation, specify for each 
relevant capital measure the levels at which an 
identified financial holding company is well cap-
italized, 
undercapitalized, 
and 
significantly 
undercapitalized. 
(C) CRITICAL CAPITAL.— 
(i) BOARD TO SPECIFY LEVEL.— 
(I) 
LEVERAGE
LIMIT.—The 
Board shall, by regulation, specify the 
ratio of tangible equity to total assets 
at which an identified financial hold-
ing company is critically undercapital-
ized. 
(II) OTHER RELEVANT CAPITAL 
MEASURES.—The Board may, by reg-
ulation, specify for 1 or more other 
relevant capital measures, the level at 
which an identified financial holding 
company is critically undercapitalized. 
(ii) LEVERAGE
LIMIT
RANGE.—The 
level specified under clause (i)(I) shall re-
quire tangible equity in an amount— 
(I) not less than 2 percent of 
total assets; and 
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(II) except as provided in sub-
clause (I), not more than 65 percent 
of the required minimum level of cap-
ital under the leverage limit. 
(5) CAPITAL DISTRIBUTIONS RESTRICTED.— 
(A) IN GENERAL.—An identified financial 
holding company shall make no capital distribu-
tion if, after making the distribution, the identi-
fied financial holding company would be under-
capitalized. 
(B) EXCEPTION.—Notwithstanding sub-
paragraph (A), the Board may permit an iden-
tified financial holding company to repurchase, 
redeem, retire, or otherwise acquire shares or 
ownership interests if the repurchase, redemp-
tion, retirement, or other acquisition— 
(i) is made in connection with the 
issuance of additional shares or obligations 
of the identified financial holding company 
in at least an equivalent amount; and 
(ii) will reduce the identified financial 
holding company’s financial obligations or 
otherwise improve the identified financial 
holding company’s financial condition. 
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(6) 
PROVISIONS
APPLICABLE
TO
UNDER-
CAPITALIZED IDENTIFIED FINANCIAL COMPANIES.— 
(A) MONITORING REQUIRED.—The Board 
shall— 
(i) closely monitor the condition of 
any undercapitalized identified financial 
holding company; 
(ii) closely monitor compliance by any 
undercapitalized identified financial hold-
ing company with capital restoration plans, 
restrictions, and requirements imposed 
under this section; and 
(iii) periodically review the plan, re-
strictions, and requirements applicable to 
any undercapitalized identified financial 
holding company to determine whether the 
plan, restrictions, and requirements are ef-
fective. 
(B) CAPITAL
RESTORATION
PLAN
RE-
QUIRED.— 
(i) IN GENERAL.—Any undercapital-
ized identified financial holding company 
shall submit an acceptable capital restora-
tion plan to the Board within the time al-
lowed by the Board under clause (iv). 
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(ii) CONTENTS OF PLAN.—The capital 
restoration plan shall— 
(I) specify— 
(aa) the steps the identified 
financial holding company will 
take to become well capitalized; 
(bb) the levels of capital to 
be attained by the identified fi-
nancial holding company during 
each year in which the plan will 
be in effect; 
(cc) how the identified fi-
nancial holding company will 
comply with the restrictions or 
requirements then in effect under 
this section; and 
(dd) the types and levels of 
activities in which the identified 
financial holding company will 
engage; and 
(II) contain such other informa-
tion that the Board may require. 
(iii) 
CRITERIA
FOR
ACCEPTING 
PLAN.—The Board shall not accept a cap-
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ital restoration plan unless it determines 
that the plan— 
(I) complies with subparagraph 
(B); 
(II) is based on realistic assump-
tions, and is likely to succeed in re-
storing the identified financial holding 
company’s capital; and 
(III) would not appreciably in-
crease the risk (including credit risk, 
interest-rate risk, and other types of 
risk) to which the identified financial 
holding company is exposed. 
(iv) DEADLINES FOR SUBMISSION AND 
REVIEW OF PLANS.—The Board shall, by 
regulation, establish deadlines that— 
(I) provide identified financial 
holding companies with reasonable 
time to submit capital restoration 
plans, and generally require an identi-
fied financial holding company to sub-
mit a plan not later than 45 days 
after it becomes undercapitalized; and 
(II) require the Board to act on 
capital restoration plans expeditiously, 
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and generally not later than 60 days 
after the plan is submitted. 
(C) ASSET
GROWTH
RESTRICTED.—An 
undercapitalized identified financial holding 
company shall not permit its average total as-
sets during any calendar quarter to exceed its 
average total assets during the preceding cal-
endar quarter unless— 
(i) the Board has accepted the identi-
fied financial holding company’s capital 
restoration plan; 
(ii) any increase in total assets is con-
sistent with the plan; and 
(iii) the identified financial holding 
company’s ratio of tangible equity to total 
assets increases during the calendar quar-
ter at a rate sufficient to enable it to be-
come well capitalized within a reasonable 
time. 
(D) PRIOR APPROVAL REQUIRED FOR AC-
QUISITIONS AND NEW LINES OF BUSINESS.—An 
undercapitalized identified financial holding 
company shall not, directly or indirectly, ac-
quire any interest in any company or insured 
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depository institution, or engage in any new line 
of business, unless— 
(i) the Board has accepted the identi-
fied financial holding company’s capital 
restoration plan, the identified financial 
holding company is implementing the plan, 
and the Board determines that the pro-
posed action is consistent with and will 
further the achievement of the plan; 
(ii) the Board determines that the 
specific proposed action is appropriate; or 
(iii) the Board has exempted the iden-
tified financial holding company from the 
requirements of this paragraph with re-
spect to the class of acquisitions that in-
cludes the proposed action. 
(E) DISCRETIONARY
SAFEGUARDS.—The 
Board may, with respect to any undercapital-
ized identified financial holding company, take 
actions described in any subparagraph of para-
graph (7)(B) if the Board determines that 
those actions are necessary. 
(7) PROVISIONS APPLICABLE TO SIGNIFICANTLY 
UNDERCAPITALIZED IDENTIFIED FINANCIAL HOLD-
ING
COMPANIES
AND
UNDERCAPITALIZED
IDENTI-
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FIED FINANCIAL HOLDING COMPANIES THAT FAIL 
TO SUBMIT AND IMPLEMENT CAPITAL RESTORATION 
PLANS.— 
(A) IN
GENERAL.—This paragraph shall 
apply with respect to any identified financial 
holding company that— 
(i) is significantly undercapitalized; or 
(ii) is undercapitalized and— 
(I) fails to submit an acceptable 
capital restoration plan within the 
time allowed by the Board under sub-
section (e)(2)(D); or 
(II) fails in any material respect 
to implement a capital restoration 
plan accepted by the Board. 
(B) SPECIFIC ACTIONS AUTHORIZED.—The 
Board shall carry out this paragraph by taking 
1 or more of the following actions: 
(i) REQUIRING RECAPITALIZATION.— 
Doing one or more of the following— 
(I) Requiring the identified fi-
nancial 
holding 
company 
to 
sell 
enough shares or obligations of the 
identified financial holding company 
so that the identified financial holding 
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company will be well capitalized after 
the sale. 
(II) Further requiring that in-
struments sold under clause (I) be 
voting shares. 
(III) Requiring the identified fi-
nancial holding company to be ac-
quired by or combine with another 
company. 
(ii) 
RESTRICTING
TRANSACTIONS 
WITH AFFILIATES.— 
(I) Requiring the identified fi-
nancial holding company to comply 
with section 23A of the Federal Re-
serve Act (12 U.S.C. 371c), as if it 
were a member bank. 
(II) Further restricting the iden-
tified financial holding company’s 
transactions with affiliates and insid-
ers. 
(iii) RESTRICTING ASSET GROWTH.— 
Restricting the identified financial holding 
company’s asset growth more stringently 
than subsection (6)(C), or requiring the 
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identified financial holding company to re-
duce its total assets. 
(iv) RESTRICTING
ACTIVITIES.—Re-
quiring the identified financial holding 
company or any of its subsidiaries to alter, 
reduce, or terminate any activity that the 
Board determines poses excessive risk to 
the identified financial holding company. 
(v) IMPROVING MANAGEMENT.—Doing 
one or more of the following: 
(I) NEW
ELECTION
OF
DIREC-
TORS.—Ordering a new election for 
the identified financial holding com-
pany’s board of directors. 
(II) DISMISSING
DIRECTORS
OR 
SENIOR
EXECUTIVE
OFFICERS.—Re-
quiring the identified financial holding 
company to dismiss from office any 
director or senior executive officer 
who had held office for more than 180 
days immediately before the identified 
financial holding company became 
undercapitalized. Dismissal under this 
clause shall not be construed to be a 
removal under section 8 of the Fed-
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eral Deposit Insurance Act (12 U.S.C. 
1818). 
(III) 
EMPLOYING
QUALIFIED 
SENIOR
EXECUTIVE
OFFICERS.—Re-
quiring the identified financial holding 
company to employ qualified senior 
executive officers (who, if the Board 
so specifies, shall be subject to ap-
proval by the Board). 
(vi) REQUIRING
DIVESTITURE.—Re-
quiring the identified financial holding 
company to divest itself of or liquidate any 
subsidiary if the Board determines that the 
subsidiary is in danger of becoming insol-
vent, poses a significant risk to the identi-
fied financial holding company, or is likely 
to cause a significant dissipation of the 
identified financial holding company’s as-
sets or earnings. 
(vii) REQUIRING OTHER ACTION.—Re-
quiring the Identified financial company to 
take any other action that the Board de-
termines will better carry out the purpose 
of this section than any of the actions de-
scribed in this paragraph. 
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(C) PRESUMPTION IN FAVOR OF CERTAIN 
ACTIONS.—In complying with subparagraph 
(B), the Board shall take the following actions, 
unless the Board determines that the actions 
would not be appropriate— 
(i) The action described in subclause 
(I) or (II) of subparagraph (B)(i) (relating 
to requiring the sale of shares or obliga-
tions, or requiring the identified financial 
holding company to be acquired by or com-
bine with another company). 
(ii) The action described in paragraph 
(B)(ii)(I) (relating to restricting trans-
actions with affiliates). 
(D) SENIOR EXECUTIVE OFFICERS’ COM-
PENSATION RESTRICTED.— 
(i) IN
GENERAL.—The identified fi-
nancial holding company shall not do any 
of the following without the prior written 
approval of the Board: 
(I) Pay any bonus to any senior 
executive officer. 
(II) Provide compensation to any 
senior executive officer at a rate ex-
ceeding that officer’s average rate of 
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compensation 
(excluding 
bonuses, 
stock options, and profit-sharing) dur-
ing the 12 calendar months preceding 
the calendar month in which the iden-
tified financial holding company be-
came undercapitalized. 
(ii) FAILING TO SUBMIT PLAN.—The 
Board shall not grant any approval under 
clause (i) with respect to an identified fi-
nancial holding company that has failed to 
submit an acceptable capital restoration 
plan. 
(E) CONSULTATION
WITH
OTHER
REGU-
LATORS.—Before the Board makes a deter-
mination under subparagraph (B)(vi) with re-
spect to a subsidiary that is a broker, dealer, 
government securities broker, government secu-
rities dealer, investment company, or invest-
ment adviser, the Board shall consult with the 
Securities and Exchange Commission and, in 
the case of any other subsidiary which is sub-
ject to any financial responsibility or capital re-
quirement, any other appropriate regulator of 
such subsidiary with respect to the proposed de-
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termination of the Board and actions pursuant 
to such determination. 
(8) MORE STRINGENT TREATMENT BASED ON 
OTHER SUPERVISORY CRITERIA.— 
(A) IN
GENERAL.—If the Board deter-
mines (after notice and an opportunity for 
hearing) that an identified financial holding 
company is in an unsafe or unsound condition 
or, pursuant to section 8(b)(8) of the Federal 
Deposit Insurance Act (12 U.S.C. 1818(b)(8)), 
deems the identified financial holding company 
to be engaging in an unsafe or unsound prac-
tice, the Board may— 
(i) if the identified financial holding 
company is well capitalized, require the 
identified financial holding company to 
comply with one or more provisions of 
paragraphs (5) and (6), as if the institu-
tion were undercapitalized; or 
(ii) if the identified financial holding 
company is undercapitalized, take any one 
or more actions authorized under para-
graph (7)(B) as if the identified financial 
holding company were significantly under-
capitalized. 
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(B) CONTENTS
OF
PLAN.—A plan that 
may be required pursuant to subparagraph 
(A)(i) shall specify the steps that the identified 
financial holding company will take to correct 
the unsafe or unsound condition or practice. 
(9) MANDATORY
BANKRUPTCY
PETITION
FOR 
CRITICALLY UNDERCAPITALIZED IDENTIFIED FINAN-
CIAL COMPANIES.—The Board shall, not later than 
90 days after an identified financial holding com-
pany becomes critically undercapitalized— 
(A) require the identified financial holding 
company to file a petition for bankruptcy under 
section 301 of title 11, United States Code; or 
(B) file a petition for bankruptcy against 
the identified financial holding company under 
section 303 of title 11, United States Code. 
(10) IMPLEMENTATION.—The Board shall pre-
scribe such regulations, issue such orders, and take 
such other actions the Board determines to be nec-
essary to carry out this section. 
(11) OTHER AUTHORITY NOT AFFECTED.—This 
section does not limit any authority of the Board, 
any other Federal regulatory agency, or a State to 
take action in addition to (but not in derogation of) 
that required under this section. 
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(12) CONSULTATION.—The Board and the Sec-
retary of the Treasury shall consult with their for-
eign counterparties and through appropriate multi-
lateral organizations to reach agreement to extend 
comprehensive and robust prudential supervision and 
regulation to all highly leveraged and substantially 
interconnected financial companies. 
(13) ADMINISTRATIVE
REVIEW
OF
DISMISSAL 
ORDERS.— 
(A) TIMELY PETITION REQUIRED.—A di-
rector or senior executive officer dismissed pur-
suant 
to 
an 
order 
under 
paragraph 
(7)(B)(v)(II) may obtain review of that order 
by filing a written petition for reinstatement 
with the Board not later than 10 days after re-
ceiving notice of the dismissal. 
(B) PROCEDURE.— 
(i) HEARING REQUIRED.—The Board 
shall give the petitioner an opportunity 
to— 
(I) submit written materials in 
support of the petition; and 
(II) 
appear, 
personally 
or 
through counsel, before 1 or more 
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members of the Board or designated 
employees of the Board. 
(ii) DEADLINE
FOR
HEARING.—The 
Board shall— 
(I) schedule the hearing referred 
to in clause (i)(II) promptly after the 
petition is filed; and 
(II) hold the hearing not later 
than 30 days after the petition is 
filed, unless the petitioner requests 
that the hearing be held at a later 
time. 
(iii) DEADLINE FOR DECISION.—Not 
later than 60 days after the date of the 
hearing, the Board shall— 
(I) by order, grant or deny the 
petition; 
(II) if the order is adverse to the 
petitioner, set forth the basis for the 
order; and 
(III) notify the petitioner of the 
order. 
(C) STANDARD FOR REVIEW OF DISMISSAL 
ORDERS.—The petitioner shall bear the burden 
of proving that the petitioner’s continued em-
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ployment would materially strengthen the iden-
tified financial holding company’s ability— 
(i) to become well capitalized, to the 
extent that the order is based on the iden-
tified financial holding company’s capital 
level or failure to submit or implement a 
capital restoration plan; and 
(ii) to correct the unsafe or unsound 
condition or unsafe or unsound practice, to 
the extent that the order is based on para-
graph (8)(A). 
(e) REPORTS REGARDING RAPID AND ORDERLY RES-
OLUTION AND CREDIT EXPOSURE.— 
(1) IN
GENERAL.—The Board shall require 
each identified financial holding company to report 
periodically to the Board on— 
(A) its plan for rapid and orderly resolu-
tion in the event of severe financial distress; 
(B) the nature and extent to which the 
identified financial holding company has credit 
exposure to other significant financial compa-
nies; and 
(C) the nature and extent to which other 
significant financial companies have credit ex-
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posure to the identified financial holding com-
pany. 
(2) NO
LIMITING
EFFECT
ON
RECEIVER
OR 
QUALIFIED RECEIVER.—A rapid resolution plan sub-
mitted in accordance with this subsection shall not 
be binding on a receiver or qualified receiver ap-
pointed under subtitle G, a bankruptcy court, or any 
other authority that is authorized or required to re-
solve the identified financial holding company or any 
of its subsidiaries or affiliates. 
(f) AVOIDING DUPLICATION.—The Board shall take 
any action the Board deems appropriate to avoid imposing 
duplicative requirements under this chapter for identified 
financial holding companies that are also bank holding 
companies. 
SEC. 1105. AUTHORITY TO FILE INVOLUNTARY PETITION 
FOR BANKRUPTCY. 
Section 303 of title 11, United States Code is amend-
ed— 
ø(1) in subsection (h)—¿ 
ø(A) by striking ‘‘or’’ at the end of para-
graph (1); and¿ 
ø(B) by striking the period at the end of 
paragraph (2) and inserting ‘‘; or’’; and¿ 
(2) by adding the following new subsection: 
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‘‘(m) Notwithstanding subsections (a) and (b) of this 
section, an involuntary case may be commenced by the 
Board of Governors of the Federal Reserve System 
against an identified financial holding company as defined 
in section 2(t) of the Bank Holding Company Act of 1956. 
Such involuntary case may be commenced on the ground 
that the identified financial holding company is critically 
undercapitalized as defined in section 6A(b) of the Bank 
Holding Company Act of 1956.’’. 
SEC. 1106. IDENTIFICATION OF ACTIVITIES OR PRACTICES 
FOR HEIGHTENED PRUDENTIAL STANDARDS 
AND 
SAFEGUARDS 
FOR 
FINANCIAL 
STA-
BILITY PURPOSES. 
(a) IN GENERAL.—The Council may subject a finan-
cial activity or practice to heightened prudential standards 
and safeguards under section 1107 if the Council deter-
mines that the conduct of such activity or practice could 
create or increase the risk of significant liquidity, credit, 
or other problems spreading among financial institutions 
or markets and thereby threaten the stability of the finan-
cial system. 
(b) PERIODIC REVIEW
OF ACTIVITY IDENTIFICA-
TIONS.— 
(1) SUBMISSION OF ASSESSMENT.—The Board 
shall periodically submit a report to the Council con-
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taining an assessment of whether each activity or 
practice subjected to heightened prudential stand-
ards should continue to be subject to such stand-
ards. 
(2) REVIEW
AND
RECISION.—The Council 
shall— 
(A) review the assessment submitted pur-
suant to paragraph (1) and any information or 
recommendation submitted by members of the 
Council regarding whether an identified finan-
cial activity continues to merit heightened pru-
dential standards; and 
(B) rescind the action subjecting an activ-
ity to heightened prudential supervision if the 
Council determines that the activity no longer 
meets the criteria in subsection (a). 
(c) PROCEDURE FOR IDENTIFYING OR RESCINDING 
IDENTIFICATION OF AN ACTIVITY OR PRACTICE.— 
(1) COUNCIL AND BOARD COORDINATION.—The 
Council shall inform the Board if the Council is con-
sidering whether to identify or cease to identify an 
activity under this section. 
(2) NOTICE AND OPPORTUNITY FOR CONSIDER-
ATION OF WRITTEN MATERIALS.— 
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(A) IN GENERAL.—The Board shall, in an 
executive capacity on behalf of the Council, pro-
vide notice to financial companies that the 
Council is considering whether to identify an 
activity or practice for heightened prudential 
regulation, and shall provide a financial com-
pany engaged in such activity or practice 30 
days to submit written materials to inform the 
Council’s decision. The Council shall decide, 
and the Board shall provide notice of the Coun-
cil’s decision, within 60 days of the due date for 
such written materials. 
(B) EMERGENCY EXCEPTION.—The Coun-
cil may waive or modify the requirements of 
subparagraph (A) if the Council determines 
that such waiver or modification is necessary or 
appropriate to prevent or mitigate threats posed 
by an activity to financial stability. The Board 
shall, in an executive capacity on behalf of the 
Council, provide notice of such waiver or modi-
fication to financial companies as soon as prac-
ticable, which shall be no later than 24 hours 
after the waiver or modification. 
(3) FORM OF DECISION.—The Board shall pro-
vide all notices required under this subsection by 
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posting a notice on the Board’s Web site and pub-
lishing a notice in the Federal Register. 
(d) EFFECT OF IDENTIFICATION.—The Board shall, 
in accordance with section 1107, recommend to the appro-
priate primary financial regulatory agencies specific 
heightened prudential standards to be applied to an activ-
ity or practice that the Council or the Board identifies 
under this section. 
SEC. 1107. REGULATION OF IDENTIFIED ACTIVITIES FOR 
FINANCIAL STABILITY PURPOSES. 
(a) LIMITATIONS ON IDENTIFIED FINANCIAL ACTIVI-
TIES AND PRACTICES.— 
(1) RECOMMENDATIONS.—To mitigate the risks 
to United States financial stability and the United 
States economy posed by financial activities and 
practices that the Council or the Board identifies for 
heightened prudential scrutiny in accordance with 
section 1103, the Board shall recommend prudential 
standards to the appropriate primary financial regu-
latory agencies to apply to such identified activities 
and practices. 
(2) 
CRITERIA.—The 
actions 
recommended 
under paragraph (1)— 
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(A) shall be designed to maximize financial 
stability, taking costs to long-term financial and 
economic growth into account; and 
(B) may include prescribing the conduct of 
the activity or practice in specific ways (such as 
by limiting its scope, or applying particular cap-
ital or risk-management requirements to the 
conduct of the activity) or prohibiting the activ-
ity or practice altogether. 
(b) IMPLEMENTATION OF RECOMMENDED STAND-
ARDS.— 
(1) ROLE OF PRIMARY FINANCIAL REGULATORY 
AGENCY.—Each primary financial regulatory agency 
is authorized to impose, require reports regarding, 
examine for compliance with, and enforce standards 
in accordance with this section with respect to those 
entities described in øsection 2(6)¿ for which it is 
the primary financial regulatory agency. This au-
thority is in addition to and does not limit any other 
authority of the primary financial regulatory agen-
cies. Compliance by an entity with actions taken by 
a primary financial regulatory agency under this sec-
tion shall be enforceable in accordance with the stat-
utes governing the respective primary financial regu-
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latory agency’s jurisdiction over the entity as if the 
agency action were taken under those statutes. 
(2) IMPOSITION
OF
STANDARDS.—Standards 
imposed under this subsection shall be the standards 
recommended by the Board in accordance with sub-
section (a) or any other similar standards that the 
Board deems acceptable after consultation between 
the Board and the primary financial regulatory 
agency. 
(3) FAILURE TO ADOPT STANDARDS; NOTICE 
TO COUNCIL AND BOARD.—If a primary financial 
regulatory agency fails to implement the prudential 
standards recommended by the Board or other simi-
lar standards that are acceptable to the Board with-
in 60 days of the Board’s recommendation, the pri-
mary financial regulatory agency shall justify the 
failure of such agency to act in writing to the Coun-
cil and the Board within that same time period. 
(4) BACKUP AUTHORITY OF THE BOARD.— 
(A) IN GENERAL.—When notified that a 
primary financial regulatory agency has failed 
to impose heightened prudential standards rec-
ommended by the Board for financial stability 
purposes under this section, the Board is au-
thorized to directly impose, require reports re-
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garding, examine for compliance with, and en-
force such heightened prudential standards 
under this section with respect to entities de-
scribed in section 2(6) for which the primary fi-
nancial regulatory agency ordinarily is respon-
sible. 
(B) LIMITATION ON BOARD BACKUP AU-
THORITY.—The Board’s standard-imposition, 
report-related, examination, and enforcement 
activities under this subsection shall be limited 
to heightened prudential standards imposed 
under this section and shall be done in coordi-
nation with the primary financial regulatory 
agency. 
SEC. 1108. EFFECT OF RESCISSION OF IDENTIFICATION. 
(a) NOTICE.—When the Council or the Board deter-
mines that a company or activity no longer is identified 
for heightened prudential scrutiny, the Board shall inform 
the relevant primary financial regulatory agency or agen-
cies (if different from the Board) of that finding. 
(b) DETERMINATION OF PRIMARY FINANCIAL REGU-
LATORY AGENCY TO CONTINUE.—A primary financial 
regulatory agency that has imposed heightened prudential 
standards for financial stability purposes under this sub-
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title shall determine whether standards that it has im-
posed under this subtitle should remain in effect. 
SEC. 1109. EMERGENCY FINANCIAL STABILIZATION. 
(a) IN GENERAL.—Upon the written approval of the 
Board of Governors of the Federal Reserve System (which 
approval shall be made upon a vote of not less than two- 
thirds of the members of such Board then serving) and 
the Board of Directors of the Corporation (which approval 
shall be made upon a vote of not less than two-thirds of 
the members of such Board then serving), and with the 
written consent of the Secretary of the Treasury (after 
consulting with the President), the Corporation may ex-
tend credit to or guarantee obligations of solvent insured 
depository institutions or other solvent companies that are 
predominantly engaged in activities that are financial in 
nature, if necessary to prevent financial instability during 
times of severe economic distress, provided that a credit 
extension or guarantee of obligations under this section 
shall not include provision of equity in any form. 
(b) POLICIES AND PROCEDURES.—Prior to exercising 
any authority under this section, the Corporation shall es-
tablish policies and procedures governing the extension of 
credit and the issuance of guarantees. The terms and con-
ditions of any extensions of credit or guarantees issued 
shall be established by the Corporation with the approval 
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of the Secretary of the Treasury and the Board of Gov-
ernors of the Federal Reserve System. 
(c) FUNDING.—There shall be available to the Cor-
poration to carry out this section amounts in the Treasury 
not otherwise appropriated, including for the payment of 
reasonable administrative expenses. Notwithstanding sec-
tion 7(d) of the Federal Deposit Insurance Act (12 U.S.C. 
1817(d)), such amounts shall be subject to apportionment 
for the purposes of chapter 15 of title 31, United States 
Code. Amounts received by the Corporation from assess-
ments imposed under subsection (d), extensions of credit, 
and guarantees, including payments of principal, interest, 
and guarantee fees, shall be covered into the Treasury as 
miscellaneous receipts. 
(d) RECOUPMENT; ASSESSMENT.—Any losses in-
curred by the Corporation pursuant to subsection (a) shall 
be recovered from Corporation assessments on large finan-
cial companies in the manner provided in section 1609(o) 
of the Resolution Authority for Large, Interconnected Fi-
nancial Companies Act of 2009. 
(e) DEFINITIONS.—For purposes of this section, the 
following definitions apply: 
(1) ACTIVITIES THAT ARE FINANCIAL IN NA-
TURE.—The term ‘‘activities that are financial in 
nature’’ means activities that are determined to be 
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financial in nature under section 4(k) of the Bank 
Holding Company Act of 1956 (12 U.S.C. 1843(k)) 
and activities that are identified for heightened pru-
dential standards under section 1106 of this title. 
(2) COMPANY.—The term ‘‘company’’ means 
any entity other than a natural person that is incor-
porated or organized under Federal law or the laws 
of any State. 
(3) CORPORATION.—The term ‘‘Corporation’’ 
means the Federal Deposit Insurance Corporation. 
(4) INSURED DEPOSITORY INSTITUTION.—The 
term ‘‘insured depository institution’’ shall have the 
same meaning as in section 3 of the Federal Deposit 
Insurance Act (12 U.S.C. 1813). 
(5) SOLVENT.—The term ‘‘solvent’’ means as-
sets are more than the obligations to creditors. 
SEC. 1110. EXAMINATIONS AND ENFORCEMENT ACTIONS 
FOR INSURANCE AND RESOLUTIONS PUR-
POSES. 
(a) EXAMINATIONS FOR INSURANCE AND RESOLU-
TIONS PURPOSES.—Section 10(b)(3) of the Federal De-
posit Insurance Act (12 U.S.C. 1820(b)(3)) is amended 
by striking beginning ‘‘whenever the Board of Directors 
determines’’ through the period and inserting ‘‘or identi-
fied financial holding company (as defined in section 2(5)) 
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whenever the Board of Directors determines a special ex-
amination of any such depository institution is necessary 
to determine the condition of such depository institution 
for insurance or such identified financial holding company 
for resolution purposes.’’. 
(b) ENFORCEMENT AUTHORITY.—Section 8(t) of the 
Federal Deposit Insurance Act (12 U.S.C. 1818(t)) is 
amended— 
(1) at the end of subparagraph (B) by striking 
‘‘or’’; 
(2) at the end of subparagraph (C) by striking 
the period and inserting ‘‘; or’’; 
(3) by inserting new subparagraph (D), as fol-
lows: 
‘‘(D) the conduct or threatened conduct 
(including any acts or omissions) of the deposi-
tory institution holding company poses a risk to 
the Deposit Insurance Fund.’’; and 
(4) by adding new paragraph (6) at the end as 
follows— 
‘‘(6) For purposes of this subsection: 
‘‘(A) The Corporation shall have the same 
powers with respect to a depository institution 
holding company and its affiliates as the appro-
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priate Federal banking agency has with respect 
to the holding company and its affiliates; and 
‘‘(B) the holding company and its affiliates 
shall have the same duties and obligations with 
respect to the Corporation as the holding com-
pany and its affiliates have with respect to the 
appropriate Federal banking agency.’’ 
SEC. 1111. RULE OF CONSTRUCTION. 
The authorities granted to agencies under this sub-
title are in addition to any rulemaking, report-related, ex-
amination, enforcement, or other authority that such 
agencies may have under other law and in no way shall 
be construed to limit such other authority, except that any 
standards imposed for financial stability purposes under 
this subtitle shall supersede any conflicting less stringent 
requirements of the primary financial regulatory agency 
but only the extent of the conflict. 
Subtitle C—Improvements to Su-
pervision 
and 
Regulation 
of 
Federal Depository Institutions 
SEC. 1201. DEFINITIONS. 
For purposes of this subtitle, the following definitions 
shall apply: 
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(1) BOARD OF GOVERNORS.—The term ‘‘Board 
of Governors’’ means the Board of Governors of the 
Federal Reserve System. 
(2) CORPORATION.—The term ‘‘Corporation’’ 
means the Federal Deposit Insurance Corporation. 
(3) OFFICE
OF
THE
COMPTROLLER
OF
THE 
CURRENCY.—The term ‘‘Office of the Comptroller of 
the Currency’’ means the office established by sec-
tion 324 of the Revised Statutes (12 U.S.C. 1). 
(4) OFFICE
OF
THRIFT
SUPERVISION.—The 
term ‘‘Office of Thrift Supervision’’ means the office 
established by section 3 of the Home Owners’ Loan 
Act (12 U.S.C. 1462a). 
(5) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of the Treasury. 
(6) TRANSFER
DATE.—The term ‘‘transfer 
date’’ has the meaning provided in section 1205. 
(7) CERTAIN OTHER TERMS.—The terms ‘‘affil-
iate’’, ‘‘bank holding company’’, ‘‘control’’ (when 
used with respect to a depository institution), ‘‘de-
pository institution’’, ‘‘Federal banking agency’’, 
‘‘Federal savings association’’, ‘‘including’’, ‘‘insured 
branch’’, ‘‘insured depository institution’’, ‘‘savings 
association’’, ‘‘State savings association’’, and ‘‘sub-
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sidiary’’ have the same meanings as in section 3 of 
the Federal Deposit Insurance Act. 
SEC. 1202. AMENDMENTS TO THE HOME OWNERS’ LOAN 
ACT RELATING TO TRANSFER OF FUNCTIONS. 
(a) AMENDMENTS TO SECTION 2.—Section 2 of the 
Home Owners’ Loan Act (12 U.S.C. 1462) is amended 
by amending paragraph (1) to read as follows: 
‘‘(1) BOARD OF GOVERNORS.—The term ‘Board 
of Governors’ means the Board of Governors of the 
Federal Reserve System.’’. 
(b) AMENDMENTS TO SECTION 3.—Section 3 of the 
Home Owners’ Loan Act (12 U.S.C. 1462a) is amended— 
(1) by striking subsection (a) and inserting the 
following new subsection: 
‘‘(a) ESTABLISHMENT OF DIVISION OF THRIFT SU-
PERVISION.—To carry out the purposes of this Act, there 
is hereby established the Division of Thrift Supervision, 
which shall be a division within the Office of the Comp-
troller of the Currency.’’; 
(2) in subsection (b)— 
(A) by striking paragraph (1) and insert-
ing the following new paragraph: 
‘‘(1) IN GENERAL.—The Division of Thrift Su-
pervision shall be headed by a Deputy Comptroller 
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of the Currency who shall be subject to the general 
oversight of the Comptroller of the Currency.’’; 
(B) in paragraph (2), by striking ‘‘Direc-
tor’’ and inserting ‘‘Comptroller of the Cur-
rency’’; and 
(C) by striking paragraph (3) and (4); 
(3) by striking subsections (c), (d), and (e) and 
inserting the following new subsection: 
‘‘(c) POWERS OF THE COMPTROLLER OF THE CUR-
RENCY.—The Comptroller of the Currency shall have all 
the powers, duties, and functions transferred by the Fi-
nancial Stability Improvement Act of 2009 to the Comp-
troller of the Currency to carry out this Act.’’; 
(4) by redesignating subsections (f) and (i) as 
subsections (d) and (e), respectively; 
(5) in subsection (d) (as so redesignated), by 
striking ‘‘Director’’ each place such term appears 
and inserting ‘‘Comptroller of the Currency’’; 
(6) by striking subsections (g), (h), and (j); and 
(7) in subsection (e) (as so redesignated), by 
striking ‘‘compensation of the Director and other 
employees of the Office and all other expenses there-
of’’ and inserting ‘‘expenses incurred by the Comp-
troller of the Currency in carrying out this Act’’. 
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(c) AMENDMENTS TO SECTION 4.—Section 4 of the 
Home Owners’ Loan Act (12 U.S.C. 1463) is amended 
by striking ‘‘Director’’ every time it appears and inserting 
‘‘Comptroller of the Currency’’. 
(d) AMENDMENTS TO SECTION 5.— 
(1) UNIVERSAL.—Section 5 of the Home Own-
ers’ Loan Act (12 U.S.C. 1464) is amended— 
(A) by striking ‘‘Director’’ and ‘‘Director 
of the Office of Thrift Supervision’’ each place 
such term appears and inserting ‘‘Comptroller 
of the Currency’’; and 
(B) by striking ‘‘Director’s’’ each place 
such term appears and inserting ‘‘Comptroller 
of the Currency’s’’. 
(2) SPECIFIC PROVISIONS.— 
(A) Section 5(d)(2)(E) of the Home Own-
ers’ Loan Act is amended by striking ‘‘or the 
Resolution Trust Corporation, as appropriate,’’ 
each place such term appears. 
(B) Section 5(d)(3)(B) of the Home Own-
ers’ Loan Act is amended by striking ‘‘or the 
Resolution Trust Corporation’’. 
(e) AMENDMENTS TO SECTIONS 8 AND 9.—Sections 
8 and 9 of the Home Owners’ Loan Act (12 U.S.C. 
11466a, 1467) are each amended by striking ‘‘Director’’ 
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each place such term appears and inserting ‘‘Comptroller 
of the Currency’’. 
(f) TECHNICAL AND CONFORMING AMENDMENTS.— 
(1) DEFINITIONS.—Section 2 of the Home 
Owners’ Loan Act (12 U.S.C. 1462) is amended— 
(A) by striking paragraph (1) and (3); and 
(B) by redesignating paragraphs (2), (4), 
(5), (6), (7), (8), and (9) as paragraphs (1), 
(2), (3), (4), (5), (6), (7), and (8), respectively. 
(2) SECTION 3.— 
(A) The heading for section 3 of the Home 
Owners’ Loan Act is amended by striking ‘‘DI-
RECTOR OF THE OFFICE OF THRIFT SU-
PERVISION’’ and inserting ‘‘DIVISION
OF 
THRIFT SUPERVISION’’. 
(B) The heading for subsection (e) of sec-
tion (3) of the Home Owners’ Loan Act is 
amended by striking ‘‘DIRECTOR’’ and inserting 
‘‘COMPTROLLER OF THE CURRENCY’’. 
(3) SECTION
5.—The heading for paragraph 
(2)(E)(ii) of section 5(d) of the Home Owners’ Loan 
Act and the heading for paragraph (3)(B) of such 
section are each amended by striking ‘‘OR RTC’’. 
(g) CLERICAL AMENDMENT.—The table of contents 
section for the Home Owners’ Loan Act is amended by 
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striking the item relating to section 3 and inserting the 
following new item: 
‘‘Sec. 3. Division of Thrift Supervision.’’. 
SEC. 1203. AMENDMENTS TO THE REVISED STATUTES. 
(a) AMENDMENT TO SECTION 324.—Section 324 of 
the Revised Statutes of the United States (12 U.S.C. 1) 
is amended to read as follows: 
‘‘SEC. 324. COMPTROLLER OF THE CURRENCY. 
‘‘There shall be in the Department of the Treasury 
a bureau, the chief officer of which bureau shall be called 
the Comptroller of the Currency, and shall perform the 
duties of the Comptroller of the Currency under the gen-
eral direction of the Secretary of the Treasury. The Comp-
troller of the Currency shall have the same authority over 
matters as were vested in the Director of the Office of 
Thrift Supervision or the Office of Thrift Supervision on 
the day before the date of enactment of the Financial Sta-
bility Improvement Act of 2009. The Secretary of the 
Treasury may not delay or prevent the issuance of any 
rule or the promulgation of any regulation by the Comp-
troller of the Currency.’’. 
(b) AMENDMENTS TO SECTION 327.—Section 327 of 
the Revised Statutes of the United States (12 U.S.C. 4) 
is amended to read as follows: 
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‘‘SEC. 327 DEPUTY COMPTROLLERS. 
‘‘(a) APPOINTMENT.—The Secretary of the Treasury 
shall appoint no more than 5 Deputy Comptrollers of the 
Currency— 
‘‘(1) 1 of whom shall be designated First Dep-
uty Comptroller of the Currency; and 
‘‘(2) 1 of whom shall be designated the Deputy 
Comptroller of the Division of Thrift Supervision. 
‘‘(b) PAY.—The Secretary of the Treasury shall fix 
the compensation of the Deputy Comptrollers of the Cur-
rency and provide such other benefits as the Secretary 
may determine to be appropriate. 
‘‘(c) OATH
OF OFFICE; DUTIES.—Each Deputy 
Comptroller shall take the oath of office and shall perform 
such duties as the Comptroller of the Currency shall di-
rect. 
‘‘(d) SERVICE AS ACTING COMPTROLLER.—During a 
vacancy in the office or during the absence or disability 
of the Comptroller, each Deputy Comptroller shall possess 
the power and perform the duties attached by law to the 
Office of the Comptroller under such order of succession 
following the First Deputy Comptroller as the Comptroller 
shall direct.’’. 
(c) AMENDMENT TO SECTION 329.—Section 329 of 
the Revised Statutes of the United States (12 U.S.C. 11) 
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is amended by inserting ‘‘or any Federal savings associa-
tion’’ before the period at the end. 
(d) AMENDMENT TO SECTION 481.—The fourth sen-
tence of the second undesignated paragraph of Section 
5240 of the Revised Statutes of the United States (12 
U.S.C. 481) is amended by striking ‘‘Secretary of the 
Treasury;’’ and all that follows through the end of the sen-
tence, and inserting ‘‘Secretary of the Treasury; the em-
ployment and compensation of examiners, chief examiners, 
reviewing examiners, assistant examiners, and of the other 
employees of the office of the Comptroller of the Currency 
whose compensation is and shall be paid from assessments 
on banks or affiliates thereof or from other fees or charges 
imposed pursuant to this subchapter shall be set and ad-
justed pursuant to chapter 71 of title five, United States 
Code and without regard to the provisions of other laws 
applicable to officers or employees of the United States.’’. 
(e) AMENDMENT TO SECTION 482.—The first sen-
tence in the first undesignated paragraph of Section 5240 
of the Revised Statutes of the United States (12 U.S.C. 
482) is amended by inserting ‘‘pursuant to chapter 71 of 
title five, United States Code,’’ after ‘‘shall,’’. 
SEC. 1204. POWER AND DUTIES TRANSFERRED. 
(a) DIRECTOR OF THE OFFICE OF THRIFT SUPER-
VISION.— 
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(1) TRANSFER OF FUNCTIONS.—Except as oth-
erwise provided in this subtitle, all functions of the 
Director of the Office of Thrift Supervision are 
transferred to the Office of the Comptroller of the 
Currency. 
(2) COMPTROLLER’S
AUTHORITY.—Except as 
otherwise provided in this subtitle, the Comptroller 
of the Currency shall succeed to all powers, authori-
ties, rights, and duties that were vested in the Direc-
tor of the Office of Thrift Supervision under Federal 
law, including the Home Owners’ Loan Act, on the 
day before the transfer date. 
(3) FUNCTIONS RELATING TO SUPERVISION OF 
STATE SAVINGS ASSOCIATIONS.— 
(A) TRANSFER OF FUNCTIONS.—All func-
tions of the Director of the Office of Thrift Su-
pervision relating to the supervision and regula-
tion of State savings associations are trans-
ferred to the Corporation. 
(B) 
CORPORATION’S
AUTHORITY.—The 
Corporation shall succeed to all powers, au-
thorities, rights, and duties that were vested in 
the Director of the Office of Thrift Supervision 
under Federal law, including the Home Owners’ 
Loan Act, on the day before the transfer date, 
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wwoods2 on DSK1DXX6B1PROD with BILLS
115 
‘‘(3) the Federal Deposit Insurance Corporation 
in the case of a State nonmember insured bank, 
State savings association, or a foreign bank having 
an insured branch.’’; and 
(E) by striking paragraph (4); and 
(4) in subsection (z) (relating to the definition 
of the term ‘‘Federal banking agency’’), by striking 
‘‘the Director of the Office of Thrift Supervision,’’. 
SEC. 1220. AMENDMENTS TO SECTION 7. 
Section 7(a) of the Federal Deposit Insurance Act 
(12 U.S.C. 1817) is amended— 
(1) in paragraph (2)— 
(A) in subparagraph (A)— 
(i) in the first sentence, by striking 
‘‘the Director of the Office of Thrift Su-
pervision’’; and 
(ii) in the second sentence, by striking 
‘‘the Director of the Office of Thrift Su-
pervision’’; and 
(B) in subparagraph (B), by striking 
‘‘Comptroller of the Currency, the Board of 
Governors of the Federal Reserve System, and 
the Director of the Office of Thrift Super-
vision,’’ and inserting ‘‘Comptroller of the Cur-
VerDate Nov 24 2008 
00:06 Nov 20, 2009
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E:\BILLS\H3996.IH
H3996
wwoods2 on DSK1DXX6B1PROD with BILLS