HR 1858 RH
(2) by inserting at the end the following new
subsection:
‘‘(b) INTERPRETATION.—In issuing regulations pursu-
ant to section 19(a) of this Act, the Board shall ensure that,
with regard to subsection (a), the exemption for business
credit includes all business credit which is exempt from the
Truth in Lending Act in accordance with section 226.3(a)
of the regulations prescribed by the Board known as ‘regula-
tion Z’ (12 C.F.R. 226.3(a)), as in effect on the date of
enactment of the Financial Institutions Regulatory Relief
Act of 1995.’’.
SEC. 105. DISCLOSURES FOR ADJUSTABLE RATE MORT-
GAGES.
(a) IN GENERAL.—Section 127A(a)(2)(G) of the Truth
in Lending Act (15 U.S.C. 1637a(a)(2)(G)) is amended by
inserting before the semicolon ‘‘, or a statement that the
monthly payment may increase or decrease significantly
due to increases in the annual percentage rate’’.
(b) TECHNICAL AND CONFORMING AMENDMENT.—Sec-
tion 127A(b)(3) of the Truth in Lending Act (15 U.S.C.
1637a(b)(3)) is amended by striking ‘‘required under’’ and
inserting ‘‘referred to in’’.
(c) ALTERNATIVE TO HISTORICAL EXAMPLE.—Section
128(a) of the Truth in Lending Act (15 U.S.C. 1638(a))
HR 1858 RH
is amended by inserting at the end the following new para-
graph:
‘‘(14) In any variable rate transaction secured
by the consumer’s principal dwelling with a term
greater than 1 year, at the creditors’ option, a state-
ment that the monthly payment may increase or de-
crease substantially, or a historical example illustrat-
ing the effects of interest rate changes implemented
according to the loan program.’’.
(d) ENSURING HONORING OF LOCK-IN PROMISES.—
Section 128(b) of the Truth in Lending Act (15 U.S.C.
1638(b)) is amended by adding at the end the following new
paragraph:
‘‘(3) In the case of a residential mortgage transaction,
the disclosures under subsection (a) shall include the follow-
ing:
‘‘(A) The note rate and points, and a statement,
if applicable, that these terms are subject to change.
‘‘(B) A statement that the creditor must include
the disclosed note rate and points in the credit agree-
ment unless, in relation to either or both of those
terms—
‘‘(i) the disclosure clearly and conspicuously
indicates that the term is subject to change, or
HR 1858 RH
‘‘(ii) in the case of any term to which clause
(i) does not apply—
‘‘(I) the creditor has clearly and con-
spicuously indicated that the term is condi-
tioned on closing the transaction within a
prescribed time;
‘‘(II) the creditor has promptly and
clearly communicated to the consumer the
information and documentation that the
consumer is required to provide to the credi-
tor; and
‘‘(III) the consumer has failed to pro-
vide such information and documentation
within a reasonable time after receiving
that communication.’’.
SEC. 106. CERTAIN CHARGES.
(a) THIRD PARTY FEES.—Section 106(a) of the Truth
in Lending Act (15 U.S.C. 1605(a)) is amended by adding
after the 2d sentence the following new sentence: ‘‘The fi-
nance charge shall not include fees and amounts imposed
by third party closing agents (including settlement agents,
attorneys, and escrow and title companies) if the creditor
does not expressly require the imposition of the charges or
the services provided and does not retain the charges.’’.
HR 1858 RH
(b) MORTGAGE BROKER FEES.—Section 106(a) of the
Truth in Lending Act (15 U.S.C. 1605(a)) is amended by
adding at the end the following new paragraph:
‘‘(6) Mortgage broker fees.’’.
(c) TREATMENT OF CERTAIN DEBT CANCELLATION
AND DEFICIENCY WAIVER CONTRACTS.—Section 106(c) of
the Truth in Lending Act (15 U.S.C. 1605(c)) is amended
to read as follows:
‘‘(c) TREATMENT OF CERTAIN DEBT CANCELLATION
AND DEFICIENCY WAIVER CONTRACTS.—Charges or pre-
miums for any insurance or for any voluntary noninsur-
ance product, written in connection with any consumer
credit transaction, that provides protections against loss of
or damage to property or against part or all of the debtor’s
liability for amounts in excess of the value of the collateral
securing the debtor’s obligation, or against liability arising
out of the ownership or use of property, shall be included
in the finance charge unless a clear and specific statement
in writing is furnished by the creditor to the person to
whom the credit is extended, setting forth the cost of the
insurance or product if obtained from or through the credi-
tor, and stating that the person to whom credit is extended
may choose the person through which the insurance or prod-
uct is to be obtained.’’.
HR 1858 RH
(d) TAXES ON SECURITY INSTRUMENTS OR EVIDENCES
OF INDEBTEDNESS.—Section 106(d) of the Truth in Lend-
ing Act (15 U.S.C. 1605(d)) is amended by adding at the
end the following new paragraph:
‘‘(3) Any tax levied on security instruments or
on documents evidencing indebtedness if the payment
of such taxes is a precondition for recording the in-
strument securing the evidence of indebtedness.’’.
(e) PREPARATION
OF LOAN DOCUMENTS.—Section
106(e)(2) of the Truth in Lending Act (15 U.S.C.
1605(e)(2)) is amended to read as follows:
‘‘(2) Fees for preparation of loan-related docu-
ments and for attending or conducting settlement.’’.
(f) FEES RELATING TO PEST INFESTATIONS, INSPEC-
TIONS, AND HAZARDS.—Section 106(e)(5) of the Truth in
Lending Act (15 U.S.C. 1605(e)(5)) is amended by insert-
ing ‘‘, including fees related to pest infestations, premises
and structural inspections, and flood hazards’’ before the
period.
(g) ENSURING FINANCE CHARGES REFLECT COST OF
CREDIT.—
(1) REPORT.—
(A) IN GENERAL.—Not later than 6 months
after the date of the enactment of this Act, the
Board of Governors of the Federal Reserve Sys-
HR 1858 RH
tem shall submit to the Congress a report con-
taining recommendations on any regulatory or
statutory changes necessary—
(i) to ensure that finance charges im-
posed in connection with consumer credit
transactions more accurately reflect the cost
of providing credit; and
(ii) to address abusive refinancing
practices engaged in solely for the purpose
of avoiding rescission.
(B) REPORT REQUIREMENTS.—In prepar-
ing the report under this paragraph, the Board
shall—
(i) consider the extent to which it is
feasible to include in finance charges all
charges payable directly or indirectly by the
consumer to whom credit is extended, and
imposed directly or indirectly by the credi-
tor as an incident to the extension of credit
(especially those charges excluded from fi-
nance charges under section 106 of the
Truth in Lending Act as of the date of the
enactment of this Act), excepting only those
charges which are payable in a comparable
cash transaction; and
HR 1858 RH
107(c) with respect to the annual percentage
rate, but in no case may the tolerance under this
paragraph be less than $25 or greater than $200;
or
‘‘(B) is greater than the amount required to
be disclosed under this title; and
‘‘(2) shall be treated as being accurate for pur-
poses of section 125 if the amount disclosed as the fi-
nance charge does not vary from the actual finance
charge by more than an amount equal to 0.5 percent
of the total amount of credit extended.’’.
(b) BASIS OF DISCLOSURE FOR PER DIEM INTER-
EST.—Section 121(c) of the Truth in Lending Act (15
U.S.C. 1631(c)) is amended by adding at the end the follow-
ing new sentence: ‘‘In the case of any consumer credit trans-
action a portion of the interest on which is determined on
a per diem basis and is to be collected upon the consumma-
tion of such transaction, any disclosure with respect to such
portion of interest shall be deemed to be accurate for pur-
poses of this title if the disclosure is based on information
actually known to the creditor at the time that the disclo-
sure documents are being prepared for the consummation
of the transaction.’’.
HR 1858 RH
SEC. 109. LIMITATION ON LIABILITY.
(a) IN GENERAL.—Chapter 2 of the Truth in Lending
Act (15 U.S.C. 1631 et seq.) is amended by adding at the
end the following new section:
‘‘SEC. 139. CERTAIN LIMITATIONS ON LIABILITY.
‘‘(a) LIMITATIONS ON LIABILITY.—For any consumer
credit transaction subject to this title that is consummated
before the date of the enactment of the Financial Institu-
tions Regulatory Relief Act of 1995, a creditor or any as-
signee of a creditor shall have no civil, administrative, or
criminal liability under this title for, and a consumer shall
have no extended rescission rights under section 125(f) with
respect to—
‘‘(1) the creditor’s treatment, for disclosure pur-
poses, of—
‘‘(A) taxes described in section 106(d)(3);
‘‘(B) fees and amounts described in section
106(e) (2) and (5);
‘‘(C) fees and amounts referred to in the 3rd
sentence of section 106(a); or
‘‘(D) mortgage broker fees referred to in sec-
tion 106(a)(6);
‘‘(2) the form of written notice used by the credi-
tor to inform the obligor of the rights of the obligor
under section 125 if the creditor provided the obligor
with a properly dated form of written notice pub-
HR 1858 RH
lished and adopted by the Board or a comparable
written notice; or
‘‘(3) any disclosure relating to the finance charge
imposed with respect to the transaction if the amount
or percentage actually disclosed—
‘‘(A) may be treated as accurate pursuant
to section 106(f), or
‘‘(B) is greater than the amount or percent-
age required to be disclosed under this title.
‘‘(b) EXCEPTIONS.—Subsection (a) shall not apply
to—
‘‘(1) any individual action or counterclaim
brought under this title which was filed before June
1, 1995;
‘‘(2) any class action brought under this title for
which a final order certifying a class was entered be-
fore January 1, 1995;
‘‘(3) the named individual plaintiffs in any class
action brought under this title which was filed before
June 1, 1995; or
‘‘(4) any consumer credit transaction with re-
spect to which a timely notice of rescission was sent
to the creditor before June 1, 1995.’’.
(b) CLERICAL AMENDMENT.—The table of sections for
chapter 2 of the Truth in Lending Act is amended by insert-
HR 1858 RH
ing after the item relating to section 138 the following new
item:
‘‘139. Certain limitations on liability.’’.
SEC. 110. LIMITATION ON RESCISSION LIABILITY.
Section 125 of the Truth in Lending Act (15 U.S.C.
1635) is further amended by adding at the end the following
new subsection:
‘‘(h) LIMITATION ON RESCISSION.—An obligor shall
have no rescission rights arising from the form of written
notice used by the creditor to inform the obligor of the rights
of the obligor under this section, if the creditor provided
the obligor the appropriate form of written notice published
and adopted by the Board, or a comparable written notice
of the rights of the obligor, that was properly completed by
the creditor.’’.
SEC. 111. CALCULATION OF DAMAGES.
Section 130(a)(2)(A) of the Truth in Lending Act (15
U.S.C. 1640(a)(2)(A)) is amended—
(1) by striking ‘‘or (ii)’’ and inserting ‘‘(ii)’’;
and
(2) by inserting before the semicolon at the end
the following: ‘‘, or (iii) in the case of an individual
action relating to a credit transaction not under an
open end credit plan that is secured by real property
or a dwelling, not less than $250 or greater than
$2,500’’.
HR 1858 RH
SEC. 112. ASSIGNEE LIABILITY.
(a) VIOLATIONS APPARENT ON THE FACE OF TRANS-
ACTION DOCUMENTS.—Section 131 of the Truth in Lending
Act (15 U.S.C. 1641) is amended by adding at the end the
following new subsection:
‘‘(e) LIABILITY OF ASSIGNEE FOR CONSUMER CREDIT
TRANSACTIONS SECURED BY REAL PROPERTY.—
‘‘(1) IN GENERAL.—Except as otherwise specifi-
cally provided in this title, any civil action against
a creditor for a violation of this title, and any pro-
ceeding under section 108 against a creditor, with re-
spect to a consumer credit transaction secured by real
property may be maintained against any assignee of
such creditor only if—
‘‘(A) the violation for which such action or
proceeding is brought is apparent on the face of
the disclosure statement provided in connection
with such transaction pursuant to this title; and
‘‘(B) the assignment to the assignee was vol-
untary.
‘‘(2) VIOLATION APPARENT ON THE FACE OF THE
DISCLOSURE
DESCRIBED.—For the purpose of this
section, a violation is apparent on the face of the dis-
closure statement if—
‘‘(A) the disclosure can be determined to be
incomplete or inaccurate from the face of the dis-
HR 1858 RH
closure statement, any itemization of the amount
financed, or any other disclosure of disburse-
ment; or
‘‘(B) the disclosure statement does not use
the terms or format required to be used by this
title.’’.
(b) SERVICER NOT TREATED AS ASSIGNEE.—Section
131 of the Truth in Lending Act (15 U.S.C. 1641) is
amended by inserting after subsection (e) (as added by sub-
section (a) of this section) the following new subsection:
‘‘(f) TREATMENT OF SERVICER.—
‘‘(1) IN GENERAL.—A servicer of a consumer ob-
ligation arising from a consumer credit transaction
shall not be treated as an assignee of such obligation
for purposes of this section unless the servicer is the
owner of the obligation.
‘‘(2) SERVICER
NOT
TREATED
AS
OWNER
ON
BASIS OF ASSIGNMENT FOR ADMINISTRATIVE CONVEN-
IENCE.—A servicer of a consumer obligation arising
from a consumer credit transaction shall not be treat-
ed as the owner of the obligation for purposes of this
section on the basis of an assignment of the obligation
from the creditor or another assignee to the servicer
solely for the administrative convenience of the
servicer in servicing the obligation. Upon written re-
HR 1858 RH
quest by the obligor, the servicer shall provide the ob-
ligor, to the best knowledge of the servicer, with the
name, address, and telephone number of the owner of
the obligation or the master servicer of the obligation.
‘‘(3) SERVICER DEFINED.—For purposes of this
subsection, the term ‘servicer’ has the same meaning
as in section 6(i)(2) of the Real Estate Settlement
Procedures Act of 1974.’’.
SEC. 113. RESCISSION RIGHTS IN FORECLOSURE.
Section 125 of the Truth in Lending Act (15 U.S.C.
1635) is amended by inserting after subsection (h) (as
added by section 110) the following new subsection:
‘‘(i) RESCISSION RIGHTS IN FORECLOSURE.—
‘‘(1) IN GENERAL.—Notwithstanding section 139,
and subject to the time period provided in subsection
(f), in addition to any other right of rescission avail-
able under this section for a transaction, upon an ac-
tion of a creditor to execute foreclosure on the pri-
mary dwelling of an obligor securing an extension of
credit, the obligor shall have a right to rescind the
transaction equivalent to other rescission rights pro-
vided by this section, if—
‘‘(A) a mortgage brokers fee is not included
in the finance charge in accordance with the
laws and regulations in effect at the time the
HR 1858 RH
consumer credit transaction was consummated;
or
‘‘(B) the form of notice of rescission for the
transaction is not the appropriate form of writ-
ten notice published and adopted by the Board
or a comparable written notice, or was not prop-
erly completed by the creditor.
‘‘(2) TOLERANCE FOR DISCLOSURES.—Notwith-
standing section 106(f), and subject to the time period
provided in subsection (f), for the purposes of exercis-
ing any rescission rights following an action by a
creditor to foreclose on the principal dwelling of the
obligor securing an extension of credit, the disclosure
of the finance charge and other disclosures affected by
any finance charge shall be treated as being accurate
for purposes of this section if the amount disclosed as
the finance charge does not vary from the actual fi-
nance charge by more than $35 or is greater than the
amount required to be disclosed under this title.’’.
SEC. 114. RECOVERY OF FEES.
Section 125(b) of the Truth in Lending Act (15 U.S.C.
1635) is amended—
(1) in the 1st sentence, by inserting ‘‘, except
any charge for an appraisal report or credit report’’
after ‘‘other charge’’; and
HR 1858 RH
(2) in the 2d sentence, by striking ‘‘otherwise’’
and inserting ‘‘as otherwise required under this sub-
section’’.
SEC. 115. HOME OWNERSHIP DEBT COUNSELING NOTIFICA-
TION.
Section 106(c) of the Housing and Urban Development
Act of 1968 (12 U.S.C. 1701x(c)) is amended by striking
paragraph (5).
SEC. 116. HOME MORTGAGE DISCLOSURE ACT.
(a) Section 309 of the Home Mortgage Disclosure Act
of 1975 (12 U.S.C. 2808) is amended—
(1) in the 2d sentence, by striking ‘‘$10,000,000’’
and inserting ‘‘$50,000,000’’; and
(2) by inserting at the end the following new sen-
tences: ‘‘The Board may also, by regulation, exempt
from the provisions of this Act institutions specified
in section 303(2)(A) which have total assets as of
their last full fiscal year of $50,000,000 or greater
where the burden of complying with this Act on such
institutions outweighs the usefulness of the informa-
tion required to be disclosed. The exemptions provided
under this section shall not be applicable to an insti-
tution which the Board, by order, has found a reason-
able basis to believe is not fulfilling its obligations to
serve the housing needs of the communities and neigh-
HR 1858 RH
borhoods in which it located. An institution subject to
such an order shall be required to comply with the re-
quirements of this Act for loans made after the time
that the order is issued at such time and for such pe-
riod as the Board deems appropriate. The dollar
amount in this section shall be adjusted annually
after December 31, 1994, by the annual percentage in-
crease in the Consumer Price Index for Urban Wage
Earners and Clerical Workers published by the Bu-
reau of Labor Statistics.’’.
(b) Section 304 of the Home Mortgage Disclosure Act
of 1975 (12 U.S.C. 2803) is amended by adding at the end
the following new subsection:
‘‘(m) OPPORTUNITY TO REDUCE COMPLIANCE BUR-
DEN.—
‘‘(1) A depository institution shall be considered
to have satisfied the public availability requirements
of subsection (a) if such institution keeps the informa-
tion required under that subsection at its home office
and provides notice at the branch locations specified
in such subsection that such information is available
upon request from the home office of the institution.
A home office of the depository institution receiving
a request for such information pursuant to this sub-
section shall provide the information pertinent to the
HR 1858 RH
location of the branch in question within fifteen days
of the receipt of the written request.
‘‘(2) In complying with paragraph (1), a deposi-
tory institution may provide the individual request-
ing such information, at the institution’s choice,
with—
‘‘(A) a paper copy of the information re-
quested; or
‘‘(B) if acceptable to the individual, the in-
formation through a form of electronic medium,
such as computer disc.’’.
SEC. 117. APPLICABILITY.
(a) IN GENERAL.—The amendments made by sub-
sections (a), (d), (e), and (f) of section 106 and sections
108, 112, and 113 shall apply to all consumer credit trans-
actions in existence or consummated on or after the date
of enactment of this Act.
(b) EXCEPTION.—Notwithstanding subsection (a), in
the case of—
(1) an individual action or a counterclaim re-
ferred to in section 139(b)(1) of the Truth in Lending
Act, as amended by section 109(a) of this Act;
(2) a class action referred to in section 139(b)(2)
of that Act;
HR 1858 RH
(3) a claim of an individual as a named indi-
vidual plaintiff in a class action referred to in section
139(b)(3) of that Act; or
(4) a claim relating to a consumer credit trans-
action referred to in section 139(b)(4) of that Act;
the Truth in Lending Act shall apply as in effect on the
date of the consummation of the consumer credit trans-
action that is the subject of the individual action, counter-
claim, class action, or claim, respectively.
Subtitle B—Community
Reinvestment Act Amendments
SEC. 121. EXPRESSION OF CONGRESSIONAL INTENT.
Subsection (b) of section 802 of the Community Rein-
vestment Act of 1977 (12 U.S.C. 2901) is amended to read
as follows:
‘‘(b) It is the purpose of this title to require each ap-
propriate Federal financial supervisory agency to use its
authority, when examining financial institutions, to en-
courage such institutions to help meet the credit needs of
the local communities in which they are chartered consist-
ent with the safe and sound operation of such institutions.
When examining financial institutions, a supervisory agen-
cy shall not impose additional burden, recordkeeping, or re-
porting upon such institutions.’’.
HR 1858 RH
SEC. 122. COMMUNITY REINVESTMENT ACT EXEMPTION.
The Community Reinvestment Act of 1977 (12 U.S.C.
2901 et seq.) is amended by adding at the end the following
new section:
‘‘SEC. 809. EXAMINATION EXEMPTION.
‘‘(a) IN GENERAL.—A regulated financial institution
shall not be subject to the examination requirements of this
title or any regulations issued under this section if the insti-
tution and any bank holding company which controls such
institution have aggregate assets of not more than
$100,000,000.
‘‘(b) ANNUAL ADJUSTMENT.—The dollar amount in
subsection (a) shall be adjusted annually after December 31,
1994, by the annual percentage increase in the Consumer
Price Index for Urban Wage Earners and Clerical Workers
published by the Bureau of Labor Statistics.’’.
SEC. 123. SELF-CERTIFICATION OF CRA COMPLIANCE.
Section 804 of the Community Reinvestment Act of
1977 (12 U.S.C. 2903) is amended by adding at the end
the following new subsection (c):
‘‘(c) SELF-CERTIFICATION OF CRA COMPLIANCE.—
‘‘(1) CERTIFICATION.—In lieu of being evaluated
under section 806A and receiving a written evalua-
tion under section 807, a qualifying financial institu-
tion may elect to self-certify to the appropriate Fed-
HR 1858 RH
eral financial supervisory agency that such institu-
tion is in compliance with the goals of this title.
‘‘(2) QUALIFYING INSTITUTION.—
‘‘(A) IN GENERAL.—For purposes of para-
graph (1), the term ‘qualifying institution’
means a financial institution which—
‘‘(i) has not more than $250 million in
assets;
‘‘(ii) has not been found to have en-
gaged in a pattern or practice of illegal dis-
crimination under the Fair Housing Act or
the Equal Credit Opportunity Act for the
preceding 5-year calendar period; and
‘‘(iii) received rating under section
807(b)(2) of ‘satisfactory’ or ‘outstanding’
in the most recent evaluation of such insti-
tution under this title.
‘‘(B) ANNUAL
ADJUSTMENT.—The dollar
amount in subparagraph (A) shall be adjusted
annually after December 31, 1994, by the annual
percentage increase in the Consumer Price Index
for Urban Wage Earners and Clerical Workers
published by the Bureau of Labor Statistics.
‘‘(3) PUBLIC NOTICE.—
HR 1858 RH
‘‘(A) IN
GENERAL.—A qualifying institu-
tion shall maintain in every branch a public no-
tice stating that—
‘‘(i) the institution has self-certified
that the institution is satisfactorily helping
to meet the credit needs of its community;
‘‘(ii) the institution maintains—
‘‘(I) at the main office of such in-
stitution, a public file which contains
a copy of the self-certification to the
appropriate Federal financial super-
visory agency; and
‘‘(II) a map delineating the com-
munity served by the institution;
‘‘(iii) a list of the types of credit and
services that the institution provides to the
community served by the institution;
‘‘(iv) such other information that the
institution believes demonstrates the institu-
tion’s record of helping to meet the credit
needs of its community; and
‘‘(v) every public comment or letter to
the institution (and any response by the in-
stitution) received within the previous 2-
year period about the record of the institu-
HR 1858 RH
tion of helping to meet the credit needs of
its community.
‘‘(B) PUBLIC FILE.—A qualifying institu-
tion shall maintain a public file containing the
contents described in this paragraph at the insti-
tution’s main office.
‘‘(4) RATING.—
‘‘(A) IN
GENERAL.—A qualifying institu-
tion shall be deemed to have a rating of a ‘satis-
factory record of meeting community credit
needs’ for the purposes of this section and section
806A(c).
‘‘(B) PUBLICATION.—Each Federal finan-
cial supervisory agency shall publish in the Fed-
eral Register once each month a list of institu-
tions that have self-certified during the previous
month.
‘‘(C) PUBLICATION
CONSTITUTES
DISCLO-
SURE.—Publication of the name of the institu-
tion in the Federal Register as having self-cer-
tified shall constitute disclosure of the rating of
the institution to the public for purposes of sec-
tions 806A and 807.
‘‘(5) REGULATORY REVIEW.—
HR 1858 RH
‘‘(A) ASSESSMENT.—During each examina-
tion for safety and soundness, a qualifying insti-
tution’s supervisory agency shall, as part of the
agency’s review of the institution’s loans, assess
whether the institution’s basis for its self-certifi-
cation is reasonable based on the public notice
and the information contained in the public file
pursuant to paragraph (3).
‘‘(B) EXAMINATION IF SELF-CERTIFICATION
IS NOT REASONABLE.—If the agency determines
that the institution’s basis for the institution’s
self-certification is not reasonable, the agency
shall schedule an examination of the institution
for the purpose of assessing the institution’s
record of helping to meet the credit needs of its
community.
‘‘(C) 
REVOCATION
OF
SELF-CERTIFI-
CATION.—If an assessment pursuant to subpara-
graph (B) results in a less than ‘satisfactory’
rating, the agency shall revoke the institution’s
self-certification and substitute a written evalua-
tion as provided under section 807.
‘‘(D) PERIOD OF INELIGIBILITY FOR SELF-
CERTIFICATION.—An institution whose self-cer-
tification has been revoked may not self-certify
HR 1858 RH
pursuant to this subsection during the 5 years
succeeding the year in which the self-certification
is revoked.
‘‘(E) SUBSEQUENT ELIGIBILITY.—After the
end of the period of ineligibility described in
subparagraph (D), an institution which meets
the requirements for self-certification may elect
to self-certify.
‘‘(6) PROHIBITION
ON
ADDITIONAL
REQUIRE-
MENTS.—No appropriate Federal financial super-
visory agency may impose any additional require-
ments, whether by regulation or otherwise, relating to
the self-certification procedure under this subsection.’’.
SEC. 124. COMMUNITY INPUT AND CONCLUSIVE RATING.
(a) CONFORMING AMENDMENT.—Section 804(a) of the
Community Reinvestment Act of 1977 (12 U.S.C. 2903) is
amended by inserting ‘‘conducted in accordance with sec-
tion 806A,’’ after ‘‘financial institution,’’.
(b) COMMUNITY INPUT AND CONCLUSIVE RATING.—
The Community Reinvestment Act of 1977 (12 U.S.C. 2901
et seq.) is amended by inserting after section 806 the follow-
ing new section:
‘‘SEC. 806A. COMMUNITY INPUT AND CONCLUSIVE RATING.
‘‘(a) PUBLICATION OF EXAM SCHEDULE AND OPPOR-
TUNITY FOR COMMENT.—
HR 1858 RH
‘‘(1) PUBLICATION
OF
NOTICE.—Each appro-
priate Federal financial supervisory agency shall—
‘‘(A) publish in the Federal Register, 30
days before the beginning of a calendar quarter,
a listing of institutions scheduled for evaluation
for compliance with this title during such cal-
endar quarter; and
‘‘(B) provide opportunity for written com-
ments from the community on the performance,
under this title, of each institution scheduled for
evaluation.
‘‘(2) COMMENT PERIOD.—Written comments may
not be submitted to an appropriate Federal financial
supervisory agency pursuant to paragraph (1) after
the end of the 30-day period beginning on the first
day of the calendar quarter.
‘‘(3) COPY
OF
COMMENTS.—The agency shall
provide a copy of such comments to the institution.
‘‘(b) EVALUATION.—The appropriate Federal financial
supervisory agency shall—
‘‘(1) evaluate the institution in accordance with
the standards contained in section 804; and
‘‘(2) prepare and publish a written evaluation of
the institution as required under section 807.
‘‘(c) RECONSIDERATION OF RATING.—
HR 1858 RH
‘‘(A) 30 days after the rating is disclosed to
the public; or
‘‘(B) the completion of any requested recon-
sideration by the Federal financial supervisory
agency.
‘‘(2) RATING CONCLUSIVE OF MEETING COMMU-
NITY CREDIT NEEDS.—An institution’s rating shall be
the conclusive assessment of the institution’s record of
meeting the credit needs of its community for pur-
poses of section 804 until the institution’s next rating,
developed pursuant to an examination, becomes con-
clusive.
‘‘(3) SAFE HARBOR.—Institutions which have re-
ceived a ‘satisfactory’ or ‘outstanding’ rating shall be
deemed to have met the purposes of section 804.
‘‘(4) RULE OF CONSTRUCTION.—Notwithstanding
any other provision of law, no provision of this sec-
tion shall be construed as granting a cause of action
to any person.’’.
(c) OVERALL EVALUATION OF INSTITUTION.—Para-
graph (2) of section 804(a) of the Community Reinvestment
Act of 1977 (12 U.S.C. 2903(a)) is amended to read as fol-
lows:
HR 1858 RH
‘‘(2) take such record into account in the overall
evaluation of the condition of the institution by the
appropriate Federal financial supervisory agency.’’.
SEC. 125. SPECIAL PURPOSE FINANCIAL INSTITUTIONS.
(a) IN GENERAL.—Section 804 of the Community Re-
investment Act of 1977 (12 U.S.C. 2903) is amended by
inserting after subsection (c) (as added by section 123 of
this title) the following new subsection:
‘‘(d) SPECIAL PURPOSE INSTITUTIONS.—
‘‘(1) IN
GENERAL.—In conducting assessments
pursuant to this section at any special purpose insti-
tution, the appropriate Federal financial supervisory
agency shall—
‘‘(A) consider the nature of business such
institution is involved in; and
‘‘(B) assess and take into account the record
of the institution commensurate with the amount
of deposits (as defined in section 3(1) of the Fed-
eral Deposit Insurance Act) received by such in-
stitution.
‘‘(2) STANDARDS.—Each appropriate Federal fi-
nancial supervisory agency shall develop standards
under which special purpose institutions may be
deemed to have complied with the requirements of this
HR 1858 RH
title which are consistent with the specific nature of
such businesses.’’.
(b) SPECIAL PURPOSE INSTITUTION DEFINED.—Sec-
tion 803 of the Community Reinvestment Act of 1977 (12
U.S.C. 2902) is amended by adding at the end the following
new paragraph:
‘‘(5) SPECIAL
PURPOSE
INSTITUTIONS.—The
term ‘special purpose institution’ means a financial
institution that does not generally accept deposits
from the public in amounts of less than $100,000,
such as wholesale, credit card, and trust institu-
tions.’’.
SEC. 126. INCREASED INCENTIVES FOR LENDING TO LOW-
AND MODERATE-INCOME COMMUNITIES.
(a) IN GENERAL.—Section 804(b) of the Community
Reinvestment Act of 1977 (12 U.S.C. 2903(b)) is amended
to read as follows:
‘‘(b) POSITIVE CONSIDERATION OF CERTAIN LOANS
AND INVESTMENTS.—In assessing and taking into account
the records of a regulated financial institution under sub-
section (a), the appropriate Federal financial supervisory
agency shall—
‘‘(1) consider as a positive factor, consistent with
the safe and sound operation of the institution, the
institution’s investment in or loan to—
HR 1858 RH
‘‘(A) any minority depository institution or
women’s depository institution (as such terms
are defined in section 808(b)) or any low-income
credit union;
‘‘(B) any joint venture or other entity or
project which promotes the public welfare in any
distressed community (as defined by such agen-
cy) whether or not the distressed community is
located in the local community in which the reg-
ulated financial institution is chartered to do
business; and
‘‘(C) targeted low- and moderate-income
communities, including real property loans to
such communities; and
‘‘(2) consider equally with other factors capital
investment, loan participation, and other ventures
undertaken by the institution in cooperation with—
‘‘(A) minority- and women-owned financial
institutions and low-income credit unions to the
extent that these activities help meet the credit
needs of the local communities in which such in-
stitutions are chartered; and
‘‘(B) community development corporations
in extending credit and other financial services
principally to low- and moderate-income persons
HR 1858 RH
and small businesses to the extent that such com-
munity development corporations help meet the
credit needs of the local communities served by
the majority-owned institution.’’.
(b) AMENDMENT TO DEFINITIONS.—Section 803 of the
Community Reinvestment Act of 1977 (12 U.S.C. 2902) is
amended by inserting after paragraph (5) (as added by sec-
tion 125(b) of this subtitle) the following new paragraph:
‘‘(6) STATE BANK SUPERVISOR.—The term ‘State
bank supervisor’ has the same meaning as in section
3(r) of the Federal Deposit Insurance Act.’’.
(c) TECHNICAL CORRECTION.—The 1st of the 2 para-
graphs designated as paragraph (2) of section 803 of the
Community Reinvestment Act of 1977 (12 U.S.C. 2902) is
amended to read as follows:
‘‘(D) the Director of the Office of Thrift Su-
pervision with respect to any savings association
(the deposits of which are insured by the Federal
Deposit Insurance Corporation) and any savings
and loan holding company (other than a com-
pany which is a bank holding company);’’.
SEC. 
127. 
PROHIBITION 
ON 
ADDITIONAL 
REPORTING
UNDER CRA.
Section 806 of the Community Reinvestment Act of
1977 (12 U.S.C. 2905) is amended to read as follows:
HR 1858 RH
‘‘SEC. 806. REGULATIONS.
‘‘(a) IN GENERAL.—
‘‘(1) PUBLICATION REQUIREMENT.—Regulations
to carry out the purposes of this title shall be pub-
lished by each appropriate Federal financial super-
visory agency.
‘‘(2) PROHIBITION
ON
ADDITIONAL
RECORD-
KEEPING.—Regulations prescribed and policy state-
ments, commentary, examiner guidance, or other su-
pervisory material issued under this title shall not
impose any additional recordkeeping on a financial
institution.
‘‘(3) PROHIBITION
ON
LOAN
DATA
COLLEC-
TION.—No loan data may be required to be collected
and reported by a financial institution and no such
data may be made public by any Federal financial
supervisory agency under this title.’’.
SEC. 128. TECHNICAL AMENDMENT.
Section 807(b)(1)(B) of the Community Reinvestment
Act (12 U.S.C. 2906) is amended by striking ‘‘The informa-
tion’’ and inserting ‘‘In the case of a regulated financial
institution that maintains domestic branches in 2 or more
States, the information’’.
HR 1858 RH
SEC. 129. DUPLICATIVE REPORTING.
Section 10(g) of the Federal Home Loan Bank Act (12
U.S.C. 1430(g)) is amended by adding at the end the follow-
ing new paragraph (3):
‘‘(3) SPECIAL RULE.—This subsection shall not
apply to members receiving a grade of ‘outstanding’
or ‘satisfactory’ under section 807 of the Community
Reinvestment Act of 1977.’’.
SEC. 130. CRA CONGRESSIONAL OVERSIGHT.
(a) SENSE OF CONGRESS RELATING TO AGGRESSIVE
OVERSIGHT.—It is the sense of the Congress that the appro-
priate committees of the House of Representatives and the
Senate should exercise aggressive oversight of the adoption
and implementation of any regulation by any appropriate
Federal financial supervisory agency under the Community
Reinvestment Act of 1977 after the date of the enactment
of this Act.
(b) AGENCY REPORTS REQUIRED.—
(1) IN GENERAL.—Each appropriate Federal fi-
nancial supervisory agency shall submit a report to
the Congress by December 31, 1996, and by December
31, 1997, on the implementation of all regulations
prescribed by such agency under the Community Re-
investment Act of 1977 after the date of the enactment
of this Act.
HR 1858 RH
‘‘(1) IN
GENERAL.—Each appropriate Federal
banking agency shall take such action as may be nec-
essary to ensure that examiners employed by the
agency—
‘‘(A) consult on examination activities with
respect to any depository institution; and
‘‘(B) achieve an agreement and resolve any
inconsistencies on the recommendations to be
given to such institution as a consequence of any
examinations.
‘‘(2) EXAMINER-IN-CHARGE.—Each agency shall
consider appointing an examiner-in-charge with re-
spect to a depository institution to ensure consulta-
tion on examination activities among all of the agen-
cy’s examiners involved in examinations of such in-
stitution.’’.
SEC. 132. LIMITATION ON REGULATIONS.
Section 806 of the Community Reinvestment Act of
1977 (12 U.S.C. 2905) (as amended by section 127) is
amended by adding at the end the following new sub-
sections:
‘‘(b) LIMITATION ON REGULATIONS.—No regulation
may be prescribed under this title by any Federal agency
which would—
HR 1858 RH
‘‘(1) require any regulated financial institution
to—
‘‘(A) make any loan or enter into any other
agreement on the basis of any discriminatory
criteria prohibited under any law of the United
States; or
‘‘(B) make any loan to, or enter into any
other agreement with, any uncreditworthy person
that would jeopardize the safety and soundness of
such institution; or
‘‘(2) prevent or hinder in any way a financial
institution’s full responsibility to provide credit to all
segments of the community.
‘‘(c) ENCOURAGE LOANS TO CREDITWORTHY BORROW-
ERS.—Regulations prescribed under this title shall encour-
age regulated financial institutions to make loans and ex-
tend credit to all creditworthy persons, consistent with safe-
ty and soundness.’’.
Subtitle C—Consumer Banking
Reforms
SEC. 141. TRUTH IN SAVINGS.
(a) PURPOSE.—Section 262 of the Truth in Savings
Act (12 U.S.C. 4301) is amended to read as follows:
HR 1858 RH
‘‘SEC. 262. PURPOSE.
‘‘It is the purpose of this subtitle to ensure that con-
sumers can make a meaningful comparison between the
competing claims of depository institutions with regard to
deposit accounts by requiring that institutions offering in-
terest-bearing accounts pay interest on the full amount of
principal each day in a consumer deposit account at the
rate agreed to be paid by the institution.’’.
(b) PROHIBITION ON MISLEADING OR INACCURATE AD-
VERTISEMENTS AND DISCLOSURES.—Section 263 is amend-
ed to read as follows:
‘‘SEC. 263. PROHIBITION ON MISLEADING OR INACCURATE
ADVERTISEMENTS AND DISCLOSURES.
‘‘No depository institution or deposit broker shall make
any advertisement, announcement, solicitation or disclosure
relating to a deposit account that is inaccurate or mislead-
ing, including any inaccurate or misleading description of
a free or no-cost account, or that misrepresents its deposit
contracts.’’.
(c) ACCOUNT INFORMATION UPON OPENING AN AC-
COUNT.—Section 264 of the Truth in Savings Act (12
U.S.C. 4304) is amended to read as follows:
‘‘SEC. 264. ACCOUNT INFORMATION.
‘‘(a) IN GENERAL.—Each depository institution shall
disclose fees, charges, penalties, and interest rates applicable
HR 1858 RH
to each class of accounts offered by the institution in accord-
ance with this section.
‘‘(b) INFORMATION ON FEES AND CHARGES.—Each de-
pository institution shall disclose the following information
with respect to any account to a consumer at the time the
account is opened, or at such earlier time as a consumer
may request (and no additional information may be re-
quired to be disclosed under this subtitle by regulation or
otherwise with respect to such account):
‘‘(1) A description of all fees, periodic service
charges, penalties, and interest rates which may be
charged or assessed against the account (or against
the account holder in connection with such account),
the amount of any such fees, charges, or penalties (or
the method by which such amount will be calculated),
and the conditions under which any such amount will
be assessed.
‘‘(2) All minimum balance requirements that af-
fect fees, charges, and penalties, including a clear de-
scription of how each such minimum balance is cal-
culated.
‘‘(3) Any minimum amount required with re-
spect to the initial deposit in order to open the ac-
count.
HR 1858 RH
‘‘(c) INFORMATION ON INTEREST RATES.—The disclo-
sures required under subsections (a) and (b) with respect
to any account shall include the following information:
‘‘(1) Any annual rate of simple interest.
‘‘(2) The frequency with which interest will be
compounded and credited.
‘‘(d) NO REGULATIONS AUTHORIZED.—No regulations
may be prescribed with respect to this section by the Board
or any agency referred to in this title, including any regula-
tion to define any terms used in this section.’’.
(d) DISCLOSURE OF CHANGE IN TERMS.—Section 265
of the Truth in Savings Act (12 U.S.C. 4304) is amended
to read as follows:
‘‘SEC. 265. DISCLOSURE OF CHANGE IN TERMS.
‘‘If any change is made in any item required to be
disclosed under section 264, all account holders who may
be affected by such change shall be notified by mail and
provided with a description of such change at least 30 days
before the effective date of the change.’’.
(e) REPEAL OF SECTIONS.—Sections 266, 268, 271,
and 273 of the Truth in Savings Act (12 U.S.C. 4304, 4305,
4307, 4310, and 4312, respectively) are hereby repealed.
(f) REDESIGNATION OF SECTIONS.—Section 267, 270,
272 of the Truth in Savings Act (12 U.S.C. 4306, 4309,
HR 1858 RH
and 4311) are redesignated as sections 266, 268, and 269,
respectively.
(g) REDESIGNATION AND AMENDMENT OF SECTION
269.—Section 269 of the Truth in Savings Act (12 U.S.C.
4308) (as determined before the redesignation made by sub-
section (f) of this section) is amended to read as follows:
‘‘SEC. 267. REGULATIONS.
‘‘(a) IN GENERAL.—The Board, after consultation
with each agency referred to in section 268(a) and public
notice and opportunity for comment, shall prescribe regula-
tions to carry out the purpose and provisions of this sub-
title.
‘‘(b) EFFECTIVE DATE OF REGULATIONS.—The provi-
sions of this subtitle shall not apply with respect to any
depository institution before the effective date of regulations
prescribed by the Board under this subsection.’’.
(h) REDESIGNATION AND AMENDMENT OF SECTION
274.—Section 274 of the Truth in Savings Act (12 U.S.C.
4313) is amended to read as follows:
‘‘SEC. 270. DEFINITIONS.
‘‘For the purposes of this subtitle, the following defini-
tions shall apply:
‘‘(1) ACCOUNTS.—The term ‘account’ means any
account intended for use by and generally used by a
HR 1858 RH
consumer primarily for personal, family, or household
purposes that is offered by a depository institution.
‘‘(2) DEPOSIT
BROKER.—The term ‘deposit
broker’—
‘‘(A) has the meaning given to such term in
section 29(f)(1) of the Federal Deposit Insurance
Act; and
‘‘(B) includes any person who solicits any
amount from any other person for deposit in an
insured depository institution.
‘‘(3) DEPOSITORY INSTITUTION.—The term ‘de-
pository institution’—
‘‘(A) means an institution described in
clause (i), (ii), (iii), (iv), (v), or (vi) of section
19(b)(1)(A) of the Federal Reserve Act; and
‘‘(B) does not include nonautomated credit
unions which were not required to comply with
the requirements of this title as of the date of the
enactment of the Financial Institutions Regu-
latory Relief Act of 1995 pursuant to the deter-
mination of the National Credit Union Adminis-
tration Board.
‘‘(4) INTEREST.—The term ‘interest’ includes
dividends paid with respect to share accounts which
are accounts within the meaning of paragraph (1).
HR 1858 RH
‘‘(5) BOARD.—The term ‘Board’ means the
Board of Governors of the Federal Reserve System.’’.
(i) EFFECTIVE DATE.—
(1) IN
GENERAL.—The amendments made by
this section shall take effect on the effective date of
regulations prescribed by the Board of Governors of
the Federal Reserve System to implement such
amendments.
(2) AUTHORITY TO ISSUE REGULATIONS.—Not-
withstanding paragraph (1), the Board of Governors
of the Federal Reserve System shall prescribe regula-
tions in accordance with the amendment made by
subsection (g).
(3) CONTINUED APPLICABILITY OF PROVISIONS
UNTIL EFFECTIVE DATE OF NEW REGULATIONS.—The
Truth in Savings Act, as in effect on the day before
the date of the enactment of this Act, shall continue
to apply on and after such date until the effective
date of the amendments to such Act under this sec-
tion.
SEC. 142. INFORMATION SHARING.
Section 18 of the Federal Deposit Insurance Act (12
U.S.C. 1828) is amended by adding at the end the following
new subsection:
‘‘(s) CUSTOMER ACCESS TO PRODUCTS.—
HR 1858 RH
‘‘(1) IN GENERAL.—Notwithstanding any other
provision of law, any depository institution, or any
affiliate or subsidiary of any depository institution,
may share or exchange information or otherwise
transfer information between or among themselves
without any restriction or limitation if it is clearly
and conspicuously disclosed that the information may
be communicated among such persons and the
consumer is given the opportunity, before the time
that the information is initially communicated, to di-
rect that such information not be communicated
among such persons.
‘‘(2) DEFINITION.—For purposes of this sub-
section, the term ‘information’ means any and all
data, records, or other information and material ob-
tained or maintained by any depository institution
or any affiliate or subsidiary thereof in the ordinary
course of its business that relates in any way to a
person (as such term is defined in section 603(b) of
the Fair Credit Reporting Act) who applies for,
maintains, or has maintained an account or credit
relationship with or applied for, purchased or ob-
tained other products or services from any depository
institution or any affiliate or subsidiary of any de-
pository institution, regardless of the source of man-
HR 1858 RH
ner in which the information is obtained or fur-
nished.
‘‘(3) RULE OF CONSTRUCTION.—Any depository
institution, or any affiliate or subsidiary of any de-
pository institution, relying on this subsection shall
not be deemed to be a consumer reporting agency,
user, or third party, and the information itself shall
not constitute a consumer report, within the meaning
of the Fair Credit Reporting Act or other similar
law.’’.
SEC. 143. ELECTRONIC FUND TRANSFER ACT CLARIFICA-
TION.
(a) DEFINITION
OF ACCEPTED CARD
OR OTHER
MEANS OF ACCESS.—Section 903(1) of the Electronic Fund
Transfer Act (15 U.S.C. 1693a(1)) is amended by inserting
before the semicolon at the end the following: ‘‘, but such
term does not include a card, device, or computer that a
person may use to pay for transactions through use of value
stored on, or assigned to, the card, device, or computer itself,
except for those transactions where such card, device, or
computer is actually used to access an account to effect such
transaction’’.
(b) DEFINITION OF ACCOUNT.—Section 903(2) of the
Electronic Fund Transfer Act (15 U.S.C. 1693a(2)) is
amended by inserting before the semicolon at the end the
HR 1858 RH
following: ‘‘and does not include any value which is stored
on, or assigned to, a card, device, or computer itself that
enables a person to pay for transactions through use of that
stored value’’.
SEC. 144. LIMIT ON RESTITUTION FOR TRUTH IN LENDING
VIOLATIONS IF SAFETY AND SOUNDNESS OF
VIOLATOR WOULD BE AFFECTED.
Section 108(e)(3)(A) of the Truth in Lending Act (15
U.S.C. 1607(e)(3)(A)) is amended—
(1) by striking ‘‘in any such case, the agency
may require’’ and inserting ‘‘in any such case, the
agency may (i) require’’;
(2) by striking ‘‘, except that with respect to any
transaction consummated after the effective date of
section 608 of the Truth in Lending Simplification
and Reform Act, the agency shall’’ and inserting ‘‘;
or (ii)’’; and
(3) by striking ‘‘reasonable,’’ and inserting ‘‘rea-
sonable if, in the case of an agency referred to in
paragraph (1), (2), or (3) of subsection (a), the agen-
cy determines that a partial adjustment or the mak-
ing of partial payments over an extended period is
necessary to avoid causing the creditor to become
undercapitalized (as determined in accordance with
HR 1858 RH
regulations prescribed by such agency under section
38 of the Federal Deposit Insurance Act);’’.
Subtitle D—Equal Credit
Opportunity Act Amendments
SEC. 151. SHORT TITLE.
This subtitle may be cited as the ‘‘Equal Credit Oppor-
tunity Act Amendments of 1995’’.
SEC. 152. FINDINGS AND PURPOSE.
(a) FINDINGS.—The Congress finds that both the
Equal Credit Opportunity Act (15 U.S.C. 1691, et seq.) and
the Fair Credit Reporting Act (15 U.S.C. 1681, et seq.) con-
tain requirements that applicants for consumer credit be
given certain information in the event that adverse action
is taken on the application. These requirements differ in
both scope and content and for that reason are confusing
to both the consumer who receives the information and the
party required to furnish the information.
(b) PURPOSE.—It is the purpose of this subtitle to
combine and simplify the adverse action notification re-
quirements of the Equal Credit Opportunity Act and the
Fair Credit Reporting Act regarding applications for
consumer credit and to make the information that is re-
quired to be furnished more understandable.
HR 1858 RH
SEC. 153. EQUAL CREDIT OPPORTUNITY ACT AMENDMENTS.
(a) 
NOTICE
OF
ADVERSE
ACTION.—Section
701(d)(2)(B) of the Equal Credit Opportunity Act (15
U.S.C. 1691(d)(2)(B)) is amended to read as follows:
‘‘(B) giving written notification of adverse
action which discloses—
‘‘(i) the applicant’s right to a state-
ment of reasons within 30 days after receipt
by the creditor of a request made within 60
days after such notification;
‘‘(ii) if credit is denied or the charge
for such credit is increased either wholly or
partly because of information contained in
a consumer report from a consumer report-
ing agency—
‘‘(I) that fact and the name, ad-
dress, and telephone number of the
consumer reporting agency making the
report;
‘‘(II) the consumer’s right to ob-
tain, under section 612, a free copy of
a consumer report on the consumer,
from the consumer reporting agency re-
ferred to in subclause (I) within the
30-day period provided under such sec-
tion; and
HR 1858 RH
‘‘(III) the consumer’s right to dis-
pute, under section 611, with a
consumer reporting agency the accu-
racy or completeness of any informa-
tion in a consumer report furnished by
the agency.
‘‘(iii) if credit is denied or the charge
for credit is increased either wholly or part-
ly because of information obtained from a
person other than a consumer reporting
agency bearing upon the consumer’s credit
worthiness, credit standing, credit capacity,
character, 
general 
reputation, 
personal
characteristics or mode of living, that fact
and the right to receive disclosure of the na-
ture of the information so received, within
a reasonable period of time, upon the con-
sumer’s written request for information
within 60 days after learning of such ad-
verse action; and
‘‘(iv) the identity of the person or office
from which such notification may be ob-
tained.
Such statement of reasons may be given orally if
the written notification advises the applicant of
HR 1858 RH
his right to have the statement of reasons con-
firmed in writing on written request.’’.
(b) TECHNICAL AND CONFORMING AMENDMENT.—Sec-
tion 701(d)(3) of the Equal Credit Opportunity Act (15
U.S.C. 1691(d)(3)) is amended by striking the period at
the end and adding the following: ‘‘and, to the extent appli-
cable, the name, address, and telephone number of the
consumer reporting agency identified in accordance with
the requirements of subsection (d)(3)(ii) and a statement
of the right to obtain disclosure of the nature of the informa-
tion upon which adverse action was taken as required by
such subsection.’’.
(c) REASONABLE PROCEDURES TO ASSURE COMPLI-
ANCE.—Section 706 of the Equal Credit Opportunity Act
(15 U.S.C. 1691e) is amended by adding at the end the
following new subsection:
‘‘(l) REASONABLE PROCEDURES TO ASSURE COMPLI-
ANCE.—No person shall be held liable for any violation of
subsection 701(d) if such person shows by a preponderance
of the evidence that at the time of the alleged violation the
person maintained reasonable procedures to assure compli-
ance with the provisions of the subsection.’’.
HR 1858 RH
SEC. 154. FAIR CREDIT REPORTING ACT AMENDMENTS.
(a) Section 615(a) of the Fair Credit Reporting Act
(15 U.S.C. 1681m(a)) is amended by striking ‘‘credit or’’
each place such term appears.
(b) Section 615 of the Fair Credit Reporting Act (15
U.S.C. 1681m) is amended by striking subsection (b) and
redesignating subsection (c) as subsection (b).
(c) Section 615(b) (as redesignated by this section) of
the Fair Credit Reporting Act (15 U.S.C. 1681m(b)) is
amended by striking ‘‘subsections (a) and (b)’’ and insert-
ing ‘‘subsection (a)’’.
SEC. 155. INCENTIVES FOR SELF-TESTING.
(a) EQUAL CREDIT OPPORTUNITY.—
(1) IN
GENERAL.—The Equal Credit Oppor-
tunity Act (15 U.S.C. 1691 et seq.) is amended by in-
serting after section 704 the following new section:
‘‘SEC. 704A. INCENTIVES FOR SELF-TESTING AND SELF-COR-
RECTION.
‘‘(a) IN GENERAL.—If a creditor—
‘‘(1) conducts, or authorizes an independent
third party to conduct, a self-test of the creditor’s
lending or any part of the creditor’s lending oper-
ations in order to determine the level or effectiveness
of compliance with this title by the creditor; and
HR 1858 RH
‘‘(2) has identified discriminatory practices and
has taken or is taking appropriate corrective actions
to address the discrimination,
any report or results of such a self-test may not be obtained
or used by any applicant, department, or agency in any
proceeding or civil action brought under this title.
‘‘(b) RESULTS OF SELF-TESTING.—No provision of
this section shall be construed as preventing an applicant,
department, or agency from obtaining and using the results
of any self-testing in any proceeding or civil action brought
under this title if—
‘‘(1) the creditor or any other entity conducted
such activity at the request of a department or agen-
cy;
‘‘(2) the creditor or any other entity, or any per-
son acting on behalf of the creditor or other entity—
‘‘(A) voluntarily releases or discloses all, or
any part of, such results; or
‘‘(B) refers to or describes such results as a
defense to charges of unlawful discrimination
against such creditor, person, or entity; or
‘‘(3) the results are sought by the applicant, de-
partment, or agency by means of a discovery request
for the purposes of determining an appropriate pen-
alty or remedy for a violation of this title.
HR 1858 RH
‘‘(c) REGULATIONS.—The appropriate Federal depart-
ment or agency shall prescribe regulations, after notice and
opportunity for comment, which determine what types of
‘self-tests’ are sufficiently extensive so as to constitute a de-
termination of the level or effectiveness of a creditor’s com-
pliance with this title.’’.
(2) REFERRALS TO THE ATTORNEY GENERAL.—
Section 706(g) of the Equal Credit Opportunity Act
(15 U.S.C. 1691e(g)) is amended—
(A) by striking ‘‘(g) The agencies’’ and in-
serting ‘‘(g) REFERRALS
TO
THE ATTORNEY
GENERAL.—
‘‘(1) IN GENERAL.—The agencies’’; and
(B) by adding at the end the following new
paragraphs:
‘‘(2) LIMITATION ON REFERRALS OF SELF-TEST-
ING RESULTS.—
‘‘(A) IN GENERAL.—No agency shall be re-
quired to refer any report or results of a self-test
relating to any creditor to the Attorney General
if the creditor—
‘‘(i) has already identified discrimina-
tory practices as the result of self-testing in-
stituted by the creditor to determine compli-
ance with this title; and
HR 1858 RH
‘‘(ii) has taken or is taking appro-
priate corrective actions to address the dis-
crimination.
‘‘(3) ENFORCEMENT UNDER OTHER LAWS.—No
provision of this section shall be construed as limiting
the authority of the agency to enforce the provisions
of this title under any other provision of law.’’.
(3) REFERRALS TO HUD.—Section 706(k) of the
Equal Credit Opportunity Act (15 U.S.C. 1691e(k))
is amended by adding at the end the following: ‘‘No
such agency shall be required to notify the Secretary
of Housing and Urban Development or the applicant
that the agency has reason to believe that a violation
of this title or the Fair Housing Act occurred if the
reason is based on a result of self-testing instituted by
the creditor to determine compliance with this title,
and the creditor has already identified the possible
violation and has taken or is taking appropriate cor-
rective actions to address the possible violation. No
provisions of this section shall be construed as limit-
ing the authority of the agency to enforce the provi-
sions of this title under any other provision of law.’’.
(4) CLERICAL AMENDMENT.—The table of sec-
tions for title VII of the Consumer Credit Protection
HR 1858 RH
Act is amended by inserting after the item relating to
section 704 the following new item:
‘‘704A. Incentives for self-testing and self-correction.’’.
(b) FAIR HOUSING.—The Fair Housing Act (42
U.S.C. 3601 et seq.) is amended by inserting after section
814 the following new section:
‘‘SEC. 814A. SELF-TESTING ENHANCEMENT.
‘‘(a) IN GENERAL.—If any person—
‘‘(1) conducts, or authorizes an independent
third party to conduct, a self-test of that person’s resi-
dential real estate related lending activities, or any
part of such activities, in order to determine the level
or effectiveness of compliance with this title by the
person; and
‘‘(2) has identified discriminatory practices and
has taken or is taking appropriate corrective actions
to address the discrimination,
any report or results of such a self-test may not be obtained
or used by any aggrieved person, complainant, department,
or agency in any proceeding or civil action brought under
this title.
‘‘(b) RESULTS OF SELF-TESTING.—No provision of
this section shall be construed as preventing an aggrieved
person, complainant, department, or agency from obtaining
and using the results of any self-testing as described in sub-
HR 1858 RH
section (a) in any proceeding or civil action brought under
this title if—
‘‘(1) the creditor or any other entity conducted
such activity at the request of a department or agen-
cy;
‘‘(2) the creditor or any other entity, or any per-
son acting on behalf of the creditor or other entity—
‘‘(A) voluntarily releases or discloses all, or
any part of, such results; or
‘‘(B) refers to or describes such results as a
defense to charges of unlawful discrimination
against such creditor, person, or entity; or
‘‘(3) the results are sought by the aggrieved per-
son, complainant, department, or agency by means of
a discovery request for the purposes of determining an
appropriate penalty or remedy for a violation of this
title.
‘‘(c) REGULATIONS.—The appropriate Federal depart-
ment or agency shall prescribe regulations, after notice and
opportunity for comment, which determine what types of
‘self-tests’ are sufficiently extensive so as to constitute a de-
termination of the level or effectiveness of a creditor’s com-
pliance with this title.’’.
HR 1858 RH
SEC. 156. CREDIT SCORING SYSTEMS.
Section 701 of the Equal Credit Opportunity Act (15
U.S.C. 1691) is amended by adding at the end the following
new subsection:
‘‘(f) CREDIT SCORING SYSTEM.—
‘‘(1) IN GENERAL.—A creditor shall be deemed to
be in compliance with subsection (a) with respect to
any credit decision made by the creditor which is
based solely on the use of an empirically derived, de-
monstrably and statistically sound, credit scoring sys-
tem (as defined by the Board in regulations pre-
scribed under this title) if such system—
‘‘(A) does not utilize any category protected
under subsection (a);
‘‘(B) does not use as a factor in such system
any criterion which is so directly associated with
such a category as to be the functional equivalent
of such a category; and
‘‘(C) does not use as a factor in such system
any criterion that has a disparate impact on a
category protected under subsection (a) unless
use of the criterion is justified by business neces-
sity and there is no less discriminatory alter-
native available.
‘‘(2) AGE AS A FACTOR.—No provision of this
subsection shall be construed as precluding a creditor
HR 1858 RH
from using age as a factor in a credit scoring system
under paragraph (1) to the extent otherwise permitted
under this title.’’.
SEC. 157. CONSULTATION BY ATTORNEY GENERAL RE-
QUIRED IN NONREFERRAL CASES.
(a) EQUAL CREDIT OPPORTUNITY.—Section 706(h) of
the Equal Credit Opportunity Act (15 U.S.C. 1691e(h)) is
amended by adding at the end the following new sentence:
‘‘Before bringing a civil action against any creditor de-
scribed in paragraph (1), (2), or (3) of section 704(a), the
Attorney General shall consult with the appropriate agency
under such paragraph.’’.
(b) FAIR HOUSING ACT.—Section 814(a) of the Fair
Housing Act (42 U.S.C. 3614(a)) is amended by adding
at the end the following new sentence: ‘‘Before bringing a
civil action under the preceding sentence against any per-
son or group of persons described in paragraph (1), (2),
or (3) of section 704(a) of the Equal Credit Opportunity
Act with respect to a violation of 805(a) of this title, the
Attorney General shall consult with the appropriate agency
under such paragraph.’’.
SEC. 158. EFFECTIVE DATE.
(a) IN GENERAL.—Except with respect to the require-
ments of subsection (b), this Act shall take effect at the end
HR 1858 RH
of the 270-day period beginning on the date of the enact-
ment of this Act.
(b) IMPLEMENTING REGULATIONS.—The Board of
Governors of the Federal Reserve System shall prescribe reg-
ulations to implement this Act and such regulations shall
be published in final form before the end of the 180-day
period beginning on the date of the enactment of this Act.
Subtitle E—Consumer Leasing Act
Amendments
SEC. 161. SHORT TITLE.
This subtitle may be cited as the ‘‘Consumer Leasing
Act Amendments of 1995’’.
SEC. 162. CONGRESSIONAL FINDINGS AND DECLARATION
OF PURPOSE.
(a) FINDINGS.—The Congress finds the following:
(1) Competition among the various financial in-
stitutions and other firms engaged in the business of
consumer leasing is greatest when there is informed
use of leasing. The informed use of leasing results
from an awareness of the cost of leasing by consumers.
(2) There has been a continued trend toward
leasing automobiles and other durable goods for
consumer use as an alternative to installment credit
sales and that leasing product advances have occurred
such that lessors have been unable to provide consist-
HR 1858 RH
ent industry-wide disclosures to fully account for the
competitive progress that has occurred.
(b) PURPOSES.—
(1) It is the purpose of this subtitle to assure a
simple, meaningful disclosure of leasing terms so that
the consumer will be able to compare more readily the
various leasing terms available to the consumer and
avoid the uninformed use of leasing, and to protect
the consumer against inaccurate and unfair leasing
practices.
(2) To provide for adequate cost disclosures that
reflect the marketplace without impairing competition
and the development of new leasing products, it is the
purpose of this subtitle to provide the Board with the
regulatory authority to assure a simplified, meaning-
ful definition and disclosure of the terms of certain
leases of personal property for personal, family, or
household purposes so as to enable the lessee to com-
pare more readily the various lease terms available to
the lessee, enable comparison of lease terms with cred-
it terms where appropriate and to assure meaningful
and accurate disclosures of lease terms in advertise-
ments.
HR 1858 RH
SEC. 163. REGULATIONS.
(a) IN GENERAL.—Chapter 5 of title I of the Consumer
Credit Protection Act (15 U.S.C. 1601 et seq.) is amended
by adding at the end the following new section:
‘‘SEC. 187. REGULATIONS.
‘‘(a) REGULATIONS AUTHORIZED.—
‘‘(1) IN GENERAL.—The Board shall write regu-
lations or staff commentary, if appropriate, to update
and clarify the requirements and definitions for lease
disclosures, contracts, and any other specific issues re-
lated to consumer leasing which would carry out the
purposes of this chapter, to prevent any circumven-
tion of the chapter, and to facilitate compliance with
the requirements of the chapter.
‘‘(2) CLASSIFICATIONS, ADJUSTMENTS.—The reg-
ulations prescribed under paragraph (1) may contain
classifications and differentiations and may provide
for adjustments and exceptions for any class of trans-
action.
‘‘(b) MODEL DISCLOSURES.—The Board shall publish
model disclosure forms and clauses to facilitate compliance
with the disclosure requirements and to aid the consumer
in understanding the transaction. In designing forms, the
Board shall consider the use by lessors of data processing
or similar automated equipment. Use of the models shall
be optional. A lessor who properly uses the material aspects
HR 1858 RH
pears or through which it is disseminated shall not be liable
under this section.’’.
SEC. 165. STATUTORY PENALTIES.
Section 185(a) of the Consumer Credit Protection Act
(15 U.S.C. 1667d(a)) is amended by adding at the end the
following new sentence: ‘‘Notwithstanding the preceding
sentence, a creditor shall only have liability determined
under section 130(a)(2) for failing to comply with the re-
quirements of paragraph (2), (8), (9), or (10) of section 182
or for failing to comply with disclosure requirements under
State law for any term which the Board has determined
to be substantially the same in meaning under section 186
as any of the terms referred to in section 182.’’.
Subtitle F—Federal Home Loan
Bank Amendments
SEC. 171. APPLICATION FOR MEMBERSHIP IN THE FHLB
SYSTEM.
Section 4(b) of the Federal Home Loan Bank Act (12
U.S.C. 1424) is amended to read as follows:
‘‘(b) MEMBERSHIP BASED ON CONVENIENCY.—An in-
stitution eligible to become a member of a Federal home
loan bank under this section may become a member by sub-
mitting the institution’s application for membership to the
bank in the district where the applicant’s principal place
of business is located. An application for membership shall
HR 1858 RH
be approved by the bank if, in the judgment of the bank,
the applicant meets the criteria for eligibility contained in
this section. An institution eligible to become a member
under this section may apply for membership in an adjoin-
ing district, if appropriate for the convenience of the insti-
tution and then only with the approval of the Board.’’.
SEC. 172. FEDERAL HOME LOAN BANK EXTERNAL AUDI-
TORS.
Section 11(j) of the Federal Home Loan Bank Act (12
U.S.C. 1431(j)) is amended to read as follows:
‘‘(j) AUDITS.—
‘‘(1) Notwithstanding any other provision of law,
audits by the Comptroller General of the United
States of the financial transactions of a Federal home
loan bank shall not be limited to periods during
which Government capital has been invested in the
bank. The provisions of section 9107(c)(2) and
9108(d)(1) of title 31, of such Code, shall not apply
to any Federal home loan bank.
‘‘(2) Notwithstanding any other provision of law,
the Board shall not participate in the hiring of an ex-
ternal auditor by the banks; except, that the Board
may establish requirements for external audit con-
tracts and, that all 12 banks shall contract for an an-
nual audit with a single provider.’’.
HR 1858 RH
TITLE II—STREAMLINING
GOVERNMENT REGULATIONS
Subtitle A—Regulatory Approval
Issues
SEC. 201. STREAMLINED NONBANKING ACQUISITIONS BY
WELL CAPITALIZED AND WELL MANAGED
BANKING ORGANIZATIONS.
(a) NOTICE REQUIREMENTS.—Section 4(j) of the Bank
Holding Company Act of 1956 (12 U.S.C. 1843(j) is
amended—
(1) in paragraph (1)(A), by striking ‘‘No’’ and
inserting ‘‘Except as provided in paragraph (3), no’’;
and
(2) by adding at the end the following new para-
graphs:
‘‘(3) NO NOTICE REQUIRED FOR CERTAIN TRANS-
ACTIONS.—No notice under paragraph (1) or sub-
sections (c)(8) or (a)(2)(B) is required for a proposal
by a bank holding company to engage in any activity
or acquire the shares or assets of any company if the
proposal qualifies under paragraph (4).
‘‘(4) CRITERIA FOR STATUTORY APPROVAL.—A
proposal qualifies under this paragraph if all of the
following criteria are met:
HR 1858 RH
‘‘(A) FINANCIAL
CRITERIA.—Both before
and immediately after the proposed trans-
action—
‘‘(i) the acquiring bank holding com-
pany is well capitalized;
‘‘(ii) the lead insured depository insti-
tution of such holding company is well cap-
italized;
‘‘(iii) well capitalized insured deposi-
tory institutions control at least 80 percent
of the aggregate total risk-weighted assets of
insured depository institutions controlled by
such holding company; and
‘‘(iv) no insured depository institution
controlled by such holding company is
undercapitalized.
‘‘(B) MANAGERIAL CRITERIA.—
‘‘(i) WELL MANAGED.—At the time of
the transaction, the acquiring bank holding
company, its lead insured depository insti-
tution, and insured depository institutions
that control at least 90 percent of the aggre-
gate total risk-weighted assets of insured de-
pository institutions controlled by such
holding company are well managed.
HR 1858 RH
‘‘(ii) LIMITATION ON POORLY MANAGED
INSTITUTIONS.—Except with respect to in-
sured depository institutions described in
paragraph (6), no insured depository insti-
tution controlled by the acquiring bank
holding company has received 1 of the 2
lowest composite ratings at the later of the
institution’s most recent examination or
subsequent review.
‘‘(C) ACTIVITIES PERMISSIBLE.—Following
consummation of the proposal, the bank holding
company engages directly or through a subsidi-
ary solely in—
‘‘(i) activities that are permissible
under subsection (c)(8), as determined by
the Board by regulation or order there-
under, subject to all of the restrictions,
terms and conditions of such subsection and
such regulation or order; and
‘‘(ii) such other activities as are other-
wise permissible under this section, subject
to the restrictions, terms and conditions, in-
cluding any prior notice or approval re-
quirements, provided in this section.
‘‘(D) SIZE OF ACQUISITION.—
HR 1858 RH
‘‘(i) ASSET SIZE.—The book value of
the total assets to be acquired does not ex-
ceed 10 percent of the consolidated total
risk-weighted assets of the acquiring bank
holding company; and
‘‘(ii) CONSIDERATION.—The gross con-
sideration to be paid for the securities or
assets does not exceed 15 percent of the con-
solidated Tier 1 capital of the acquiring
bank holding company.
‘‘(E) 
NOTICE
NOT
OTHERWISE
WAR-
RANTED.—For proposals described in paragraph
(5)(B), the Board has not, before the conclusion
of the period provided in paragraph (5)(B), ad-
vised the bank holding company that a notice
under paragraph (1) is required.
‘‘(F) COMPLIANCE CRITERION.—During the
12-month period ending on the date on which the
bank holding company proposes to commence an
activity or acquisition, no administrative en-
forcement action has been commenced, and no
cease and desist order has been issued pursuant
to section 8 of the Federal Deposit Insurance
Act, against the bank holding company or any
depository institution subsidiary of the holding
HR 1858 RH
company and no such enforcement action, order,
or other administrative enforcement proceeding
is pending as of such date.
‘‘(5) NOTIFICATION.—
‘‘(A) COMMENCEMENT
OF
ACTIVITIES
AP-
PROVED
BY
RULE.—A bank holding company
that qualifies under paragraph (4) and that pro-
poses to engage de novo, directly or through a
subsidiary, in any activity that is permissible
under subsection (c)(8), as determined by the
Board by regulation, may commence that activ-
ity without prior notice to the Board and must
provide written notification to the Board no
later than ten business days after commencing
the activity.
‘‘(B) ACTIVITIES
PERMITTED
BY
ORDER
AND ACQUISITIONS.—
‘‘(i) IN GENERAL.—At least 12 business
days before commencing any activity pursu-
ant to paragraph (3) (other than an activ-
ity described in subparagraph (A)) or ac-
quiring shares or assets of any company
pursuant to paragraph (3), the bank hold-
ing company shall provide written notice of
the proposal to the Board, unless the Board
HR 1858 RH
determines that no notice or a shorter notice
period is appropriate.
‘‘(ii) DESCRIPTION OF ACTIVITIES AND
TERMS.—A notification under this subpara-
graph shall include a description of the pro-
posed activities and the terms of any pro-
posed acquisition.
‘‘(6) RECENTLY
ACQUIRED
INSTITUTIONS.—In-
sured depository institutions which have been ac-
quired by a bank holding company during the 12-
month period preceding the date on which the com-
pany proposes to commence an activity or acquisition
pursuant to paragraph (3) may be excluded for pur-
poses of paragraph (4)(B)(ii) if—
‘‘(A) the bank holding company has devel-
oped a plan for the institution to restore the cap-
ital and management of the institution which is
acceptable to the appropriate Federal banking
agency; and
‘‘(B) all such insured depository institu-
tions represent, in the aggregate, less than 10
percent of the aggregate total risk-weighted assets
of all insured depository institutions controlled
by the bank holding company.
HR 1858 RH
‘‘(7) 
ADJUSTMENT
OF
PERCENTAGES.—The
Board may, by regulation, adjust the percentages and
the manner in which the percentages of insured depos-
itory institutions are calculated under paragraph
(4)(B)(i), (4)(D), or paragraph (6)(B) if the Board
determines that any such adjustment is consistent
with safety and soundness and the purposes of this
Act.’’.
(b) DEFINITIONS.—Section 2(o) of the Bank Holding
Company Act of 1956 (12 U.S.C. 1841(o)) is amended—
(1) by striking paragraph (1) and inserting the
following new paragraph:
‘‘(1) CAPITAL TERMS.—
‘‘(A) 
INSURED
DEPOSITORY
INSTITU-
TIONS.—With respect to insured depository insti-
tutions, the terms ‘well-capitalized’, ‘adequately
capitalized’, and ‘uncapitalized’ have the mean-
ing given those terms in section 38(b) of the Fed-
eral Deposit Insurance Act.
‘‘(B) BANK HOLDING COMPANY.—
‘‘(i) ADEQUATELY CAPITALIZED.—The
term ‘adequately capitalized’ means a level
of capitalization which meets or exceeds all
applicable Federal regulatory capital stand-
ards.
HR 1858 RH
‘‘(ii) WELL
CAPITALIZED.—A bank
holding company is ‘well capitalized’ if it
meets the required capital levels for well
capitalized bank holding companies estab-
lished by the Board.
‘‘(C) OTHER CAPITAL TERMS.—The terms
‘Tier 1’ and ‘risk-weighted assets’ have the mean-
ing given those terms in the capital guidelines or
regulations established by the Board for bank
holding companies.’’; and
(2) by adding at the end the following new para-
graphs:
‘‘(8) LEAD
INSURED
DEPOSITORY
INSTITU-
TIONS.—
‘‘(A) IN GENERAL.—The term ‘lead insured
depository institution’ means the largest insured
depository institution controlled by the bank
holding company at any time, based on a com-
parison of the average total risk-weighted assets
controlled by each insured depository institution
during the previous 12-month period.
‘‘(B) BRANCH OR AGENCY.—For purposes of
this paragraph and section 4(j)(4), the term ‘in-
sured depository institution’ shall also include
HR 1858 RH
any branch or agency operated in the United
States by a foreign bank.
‘‘(9) WELL MANAGED.—The term ‘well managed’
means—
‘‘(A) in the case of any company or deposi-
tory institution which receives examinations, the
achievement of—
‘‘(i) a CAMEL composite rating of 1
or 2 (or an equivalent rating under an
equivalent rating system) in connection
with the most recent examination or subse-
quent review of such company or institu-
tion; and
‘‘(ii) at least a satisfactory rating for
management, if such rating is given; or
‘‘(B) in the case of a company or depository
institution that has not received an examination
rating, the existence and use of managerial re-
sources which the Board determines are satisfac-
tory.’’.
HR 1858 RH
SEC. 202. STREAMLINED BANK ACQUISITIONS BY WELL CAP-
ITALIZED AND WELL MANAGED BANKING OR-
GANIZATIONS.
Section 3 of the Bank Holding Company Act (12
U.S.C. 1842) is amended by adding at the end the following
new subsection:
‘‘(h) NO APPROVAL REQUIRED FOR CERTAIN TRANS-
ACTIONS.—
‘‘(1) IN GENERAL.—Notwithstanding paragraph
(3) or (5) of subsection (a) and subject to paragraphs
(5) and (6), an acquisition of shares by a registered
bank holding company, or a merger or consolidation
between registered bank holding companies, shall be
deemed approved at the conclusion of the period speci-
fied in subparagraph (G) if all of the following condi-
tions have been met:
‘‘(A) FINANCIAL
AND
MANAGERIAL
CRI-
TERIA.—
‘‘(i) WELL CAPITALIZED BANK HOLD-
ING COMPANY.—Both at the time of and im-
mediately after the proposed transaction,
the acquiring bank holding company is well
capitalized.
‘‘(ii) WELL
CAPITALIZED
LEAD
IN-
SURED DEPOSITORY INSTITUTION.—Both at
the time of and immediately after the pro-
HR 1858 RH
posed transaction, the lead insured deposi-
tory institution of the acquiring bank hold-
ing company is well capitalized.
‘‘(iii) CAPITAL OF OTHER INSURED DE-
POSITORY
INSTITUTIONS.—At the time of
the transaction, well capitalized insured de-
pository institutions control at least 80 per-
cent of the aggregate total risk-weighted as-
sets of insured depository institutions con-
trolled by the acquiring bank holding com-
pany.
‘‘(iv) NO UNDERCAPITALIZED INSURED
DEPOSITORY INSTITUTIONS.—At the time of
the transaction, no insured depository insti-
tution controlled by the acquiring bank
holding company is undercapitalized.
‘‘(v) WELL MANAGED.—
‘‘(I) IN GENERAL.—At the time of
the transaction, the acquiring bank
holding company, its lead insured de-
pository institution, and insured de-
pository institutions that control at
least 90 percent of the aggregate total
risk-weighted assets of insured deposi-
HR 1858 RH
tory institutions controlled by such
holding company are well managed.
‘‘(II) NO POORLY MANAGED INSTI-
TUTIONS.—Except with respect to in-
sured depository institutions described
in paragraph (2), no insured deposi-
tory institution controlled by the ac-
quiring bank holding company has re-
ceived 1 of the 2 lowest composite rat-
ings at the later of the institution’s
most recent examination or subsequent
review.
‘‘(B) NO UNSATISFACTORY CRA RATINGS.—
Except with respect to insured depository insti-
tutions described in paragraph (3), no insured
depository institution controlled by the acquiring
bank holding company has received a ‘needs to
improve’ or ‘substantial noncompliance’ compos-
ite rating as a result of the institution’s most re-
cent examination under the Community Rein-
vestment Act of 1977.
‘‘(C) COMPETITIVE CRITERIA.—Consumma-
tion of the proposal complies with guidelines es-
tablished by the Board by regulation, after con-
sultation with the Attorney General, that iden-
HR 1858 RH
tify proposals that are not likely to have a sig-
nificantly adverse effect on competition in any
relevant market.
‘‘(D) SIZE OF ACQUISITION.—
‘‘(i) ASSET SIZE.—The book value of
the total assets to be acquired does not ex-
ceed 10 percent of the consolidated total risk
weighted assets of the acquiring bank hold-
ing company.
‘‘(ii) CONSIDERATION.—The gross con-
sideration to be paid for the securities or
assets does not exceed 15 percent of the con-
solidated Tier 1 capital of the acquiring
bank holding company.
‘‘(E) INTERSTATE
ACQUISITIONS.—Board
approval of the transaction is not prohibited
under subsection (d).
‘‘(F) COMPLIANCE CRITERION.—During the
12-month period ending on the date of the trans-
action, no administrative enforcement action has
been commenced, and no cease and desist order
has been issued pursuant to section 8 of the Fed-
eral Deposit Insurance Act, against any bank
holding company involved in the transaction or
any depository institution subsidiary of any
HR 1858 RH
such holding company and no such enforcement
action, order, or other administrative enforce-
ment proceeding is pending as of such date.
‘‘(G) OTHER CONSIDERATIONS.—Board ap-
proval of the transaction is not prohibited under
subsection (c)(3).
‘‘(H) NOTIFICATION.—The acquiring bank
holding company provides written notice of the
transaction, including a description of the terms
of the transaction, to the Board and the Attorney
General, simultaneously, at least 15 business
days (or such shorter period as permitted by the
Board) before the transaction is consummated.
‘‘(I) NO BOARD DISAPPROVAL.—Before the
end of the 15-day period (or the shorter period)
referred to in subparagraph (H), the Board has
not required an application under subsection
(a).
‘‘(2) SPECIAL RULE RELATING TO THE REQUIRE-
MENT FOR WELL MANAGED INSTITUTIONS.—Insured
depository institutions which have been acquired by a
bank holding company during the 12-month period
preceding the date of the transaction may be excluded
for purposes of paragraph (1)(A)(v)(II) if—
HR 1858 RH
‘‘(A) the bank holding company has devel-
oped a plan for the institution to restore the cap-
ital and management of the institution which is
acceptable to the appropriate Federal banking
agency; and
‘‘(B) all such insured depository institu-
tions represent, in the aggregate, less than 10
percent of the aggregate total risk-weighted assets
of all insured depository institutions controlled
by the holding company.
‘‘(3) SPECIAL RULE RELATING TO THE REQUIRE-
MENT FOR COMMUNITY INVESTMENT.—Insured deposi-
tory institutions acquired during the 12-month period
preceding the date of the transaction may be excluded
for purposes of paragraph (1)(B) if the bank holding
company has developed a plan to restore the perform-
ance of the institution to at least a ‘satisfactory’ rat-
ing under the Community Reinvestment Act of 1977
which is acceptable to the appropriate Federal bank-
ing agency.
‘‘(4) 
ADJUSTMENT
OF
PERCENTAGES.—The
Board may by regulation adjust the percentages and
the manner in which the percentages of insured depos-
itory institutions are calculated under subparagraph
(A)(v)(I) or (D) of paragraph (1) or paragraph
HR 1858 RH
(2)(B) if the Board determines that such adjustment
is consistent with safety and soundness and the pur-
poses of this Act.
‘‘(5) ADVICE OF ATTORNEY GENERAL.—The At-
torney General shall advise the Board during the pe-
riod referred to in paragraph (1)(H) in writing if
any competitive concerns exist with respect to the
transaction.
‘‘(6) WAIVER
OF
POSTAPPROVAL
WAITING
PE-
RIOD.—If the Attorney General advises the Board
that no competitive concerns exist with respect to the
transaction, the provisions of section 11(b) relating to
a postapproval waiting shall not apply with respect
to such transaction.’’.
SEC. 203. ELIMINATE FILING AND APPROVAL REQUIRE-
MENTS FOR INSURED DEPOSITORY INSTITU-
TIONS ALREADY CONTROLLED BY THE SAME
HOLDING COMPANY.
(a) BANK MERGER ACT.—Section 18(c) of the Federal
Deposit Insurance Act (12 U.S.C. 1828(c)) is amended by
adding at the end the following new paragraph:
‘‘(12) The provisions of this subsection shall not
apply to any merger, consolidation, acquisition of as-
sets or assumption of liabilities involving only in-
105
HR 1858 RH
‘‘(A) NOTICE TO DIRECTOR.—Upon receiv-
ing any application or notice by a bank holding
company to acquire directly or indirectly a sav-
ings association under subsection (c)(8), the
Board shall solicit the Director’s comments and
recommendations with respect to such acquisi-
tion.
‘‘(B) COMMENT
PERIOD.—The comments
and views of the Director under subparagraph
(A) with respect to any acquisition subject to
such subparagraph shall be transmitted to the
Board within 30 days of the receipt by the Di-
rector of the notice relating to such acquisition
(or such shorter period as the Board may specify
if the Board advises the Director that an emer-
gency exists which requires expeditious action).
‘‘(5) EXAMINATION.—
‘‘(A) SCOPE.—The Board shall consult with
the Director, as appropriate, in establishing the
scope of an examination by the Board of a bank
holding company that controls directly or indi-
rectly a savings association.
‘‘(B) ACCESS TO INSPECTION REPORTS.—
Upon the request of the Director, the Board shall
furnish the Director with a copy of any inspec-