I
107TH CONGRESS
1ST SESSION
H. R. 557
To amend the Federal Deposit Insurance Act and the Federal Home Loan
Bank Act to provide for the payment of Financing Corporation interest
obligations from balances in the deposit insurance funds in excess of
an established ratio and, after such obligations are satisfied, to provide
for rebates to insured depository institutions of such excess reserves.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 12, 2001
Mr. LUCAS of Oklahoma (for himself and Mr. WATT of North Carolina) intro-
duced the following bill; which was referred to the Committee on Finan-
cial Services
A BILL
To amend the Federal Deposit Insurance Act and the Fed-
eral Home Loan Bank Act to provide for the payment
of Financing Corporation interest obligations from bal-
ances in the deposit insurance funds in excess of an
established ratio and, after such obligations are satisfied,
to provide for rebates to insured depository institutions
of such excess reserves.
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 ‘‘Deposit Insurance
Fairness and Economic Opportunity Act’’.
SEC. 2. USE OF EXCESS DEPOSIT FUND RESERVES TO PAY
FICO INTEREST OBLIGATIONS AND MAKE RE-
BATES.
(a) IN GENERAL.—Section 7(b)(2) of the Federal
Deposit Insurance Act (12 U.S.C. 1817(b)(2)) is
amended—
(1) by inserting after subparagraph (C) the fol-
lowing new subparagraph:
‘‘(D) USE OF EXCESS DEPOSIT INSURANCE
FUNDS INITIALLY TO PAY FICO INTEREST OBLI-
GATIONS AND THEN FOR OTHER PURPOSES.—
Notwithstanding subsection (e)(2), beginning
January 1, 2002, and annually thereafter, the
Board of Directors shall, when amounts in both
the Bank Insurance Fund and the Savings As-
sociation Insurance Fund, respectively, exceed
the amount which is equal to 1.40 percent of
the estimated insured deposits insured by such
Fund (or such higher percentage as may have
been established as the designated reserve ratio
for the respective Fund pursuant to subpara-
graph (A)(iv)(II)) transfer from such Funds the
amounts in excess of the amount that is equal
to that percentage of estimated insured deposits
as follows:
‘‘(i) YEARS 2002 THROUGH 2017.—In
years 2002 through 2017, to the Financ-
ing Corporation in such amount as is nec-
essary to pay, for such year, the interest
payments, issuance costs, and custodial
fees described in section 21(f) of the Fed-
eral Home Loan Bank Act with regard to
obligations issued by the Financing Cor-
poration.
‘‘(ii) YEARS
AFTER
2017.—In years
beginning after December 31, 2017—
‘‘(I) to the Financing Corpora-
tion for the purposes described in
clause (i); and
‘‘(II) if the amount required to
be transferred under this subpara-
graph exceeds the amount required by
the Financing Corporation for the
purposes described in clause (i), to in-
sured depository institutions, the allo-
cation of which to be made on such
basis as the Board of Directors deter-
mines to be appropriate, taking into
account the factors considered under
the risk-based assessment system.’’;
and
(2) by adding at the end the following new sub-
paragraph:
‘‘(I) PAYMENT LIMITATION FOR CERTAIN
INSTITUTIONS.—No amount may be paid under
subparagraph (D)(ii)(II) to any insured deposi-
tory institution described in clause (v) of sub-
section (b)(2)(A).’’.
(b) TECHNICAL AND CONFORMING AMENDMENTS.—
(1) Section 21(f) of the Federal Home Loan
Bank Act (12 U.S.C. 1441) is amended—
(A) by redesignating paragraphs (2) and
(3) as paragraphs (3) and (4), respectively;
(B) by inserting after paragraph (1) the
following new paragraph:
‘‘(2) EXCESS DEPOSIT INSURANCE FUND BAL-
ANCES.—In addition to the amounts obtained pursu-
ant to paragraph (1), the Financing Corporation
shall have available the amounts transferred by the
Board of Directors of the Federal Deposit Insurance
Corporation pursuant to section 7(b)(2)(D) of the
Federal Deposit Insurance Act.’’;
(C) in paragraph (3) (as so redesignated
by paragraph (2) of this subsection), by striking
‘‘In addition to the amounts obtained pursuant
to paragraph (1),’’ and inserting ‘‘To the extent
the amounts available under paragraphs (1)
and (2) are insufficient to cover the amount of
interest payments, issuance costs, and custodial
fees,’’; and
(D) in paragraph (4) (as so redesignated
by paragraph (2) of this subsection), by striking
‘‘(1) and (2)’’ and inserting ‘‘(1), (2), and (3)’’.
(2) Section 2703(c)(2) of the Deposit Insurance
Funds Act of 1996 (12 U.S.C. 1441 nt.) is
amended—
(A) by striking ‘‘21(f)(2)’’ and inserting
‘‘21(f)(3)’’; and
(B) by inserting ‘‘and redesignated by sec-
tion 2(b)(1)(A) of the Deposit Insurance Fair-
ness and Economic Opportunity Act’’ after ‘‘as
amended by subsection (a)’’.
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