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(3) REPORTS
AND
TESTIMONY.—The Inspector 
General of the Department of the Treasury shall in-
clude in the semiannual reports required by section 
5(a) of the Inspector General Act of 1978 (5 U.S.C. 
App.), a summary of the findings and assessments 
under paragraph (1), and shall appear before the ap-
propriate committees of Congress, if requested, to 
present each such report. 
(4) TERMINATION
OF
RESPONSIBILITIES.—The 
duties and responsibilities of the Inspector General of 
the Department of the Treasury under this subsection 
shall terminate 1 year after the date on which the ob-
ligations purchased by the Secretary from the Cor-
poration under section 210 are fully redeemed. 
(f) PRIMARY FINANCIAL REGULATORY AGENCY IN-
SPECTOR GENERAL REVIEWS.— 
(1) SCOPE.—Upon the appointment of the Cor-
poration as receiver for a covered financial company 
supervised by a Federal primary financial regulatory 
agency or the Board of Governors under section 165, 
the Inspector General of the agency or the Board of 
Governors shall make a written report reviewing the 
supervision by the agency or the Board of Governors 
of the covered financial company, which shall—
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(A) evaluate the effectiveness of the agency 
or the Board of Governors in carrying out its su-
pervisory responsibilities with respect to the cov-
ered financial company; 
(B) identify any acts or omissions on the 
part of agency or Board of Governors officials 
that contributed to the covered financial com-
pany being in default or in danger of default; 
(C) identify any actions that could have 
been taken by the agency or the Board of Gov-
ernors that would have prevented the company 
from being in default or in danger of default; 
and 
(D) recommend appropriate administrative 
or legislative action. 
(2) REPORTS AND TESTIMONY.—Not later than 1 
year after the date of appointment of the Corporation 
as receiver under this title, the Inspector General of 
the Federal primary financial regulatory agency or 
the Board of Governors shall provide the report re-
quired by paragraph (1) to such agency or the Board 
of Governors, and along with such agency or the 
Board of Governors, as applicable, shall appear before 
the appropriate committees of Congress, if requested, 
to present the report required by paragraph (1). Not
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later than 90 days after the date of receipt of the re-
port required by paragraph (1), such agency or the 
Board of Governors, as applicable, shall provide a 
written report to Congress describing any actions 
taken in response to the recommendations in the re-
port, and if no such actions were taken, describing the 
reasons why no actions were taken. 
SEC. 212. PROHIBITION OF CIRCUMVENTION AND PREVEN-
TION OF CONFLICTS OF INTEREST. 
(a) NO OTHER FUNDING.—Funds for the orderly liq-
uidation of any covered financial company under this title 
shall only be provided as specified under this title. 
(b) LIMIT ON GOVERNMENTAL ACTIONS.—No govern-
mental entity may take any action to circumvent the pur-
poses of this title. 
(c) CONFLICT OF INTEREST.—In the event that the 
Corporation is appointed receiver for more than 1 covered 
financial company or is appointed receiver for a covered 
financial company and receiver for any insured depository 
institution that is an affiliate of such covered financial 
company, the Corporation shall take appropriate action, as 
necessary to avoid any conflicts of interest that may arise 
in connection with multiple receiverships.
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SEC. 213. BAN ON SENIOR EXECUTIVES AND DIRECTORS. 
(a) PROHIBITION AUTHORITY.—The Board of Gov-
ernors or, if the covered financial company was not super-
vised by the Board of Governors, the Corporation, may exer-
cise the authority provided by this section. 
(b) AUTHORITY TO ISSUE ORDER.—The appropriate 
agency described in subsection (a) may take any action au-
thorized by subsection (c), if the agency determines that— 
(1) a senior executive or a director of the covered 
financial company, prior to the appointment of the 
Corporation as receiver, has, directly or indirectly— 
(A) violated— 
(i) any law or regulation; 
(ii) any cease-and-desist order which 
has become final; 
(iii) any condition imposed in writing 
by a Federal agency in connection with any 
action on any application, notice, or re-
quest by such company or senior executive; 
or 
(iv) any written agreement between 
such company and such agency; 
(B) engaged or participated in any unsafe 
or unsound practice in connection with any fi-
nancial company; or
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(C) committed or engaged in any act, omis-
sion, or practice which constitutes a breach of the 
fiduciary duty of such senior executive or direc-
tor; 
(2) by reason of the violation, practice, or breach 
described in any clause of paragraph (1), such senior 
executive or director has received financial gain or 
other benefit by reason of such violation, practice, or 
breach and such violation, practice, or breach contrib-
uted to the failure of the company; and 
(3) such violation, practice, or breach— 
(A) involves personal dishonesty on the part 
of such senior executive or director; or 
(B) demonstrates willful or continuing dis-
regard by such senior executive or director for 
the safety or soundness of such company. 
(c) AUTHORIZED ACTIONS.— 
(1) IN GENERAL.—The appropriate agency for a 
financial company, as described in subsection (a), 
may serve upon a senior executive or director de-
scribed in subsection (b) a written notice of the inten-
tion of the agency to prohibit any further participa-
tion by such person, in any manner, in the conduct 
of the affairs of any financial company for a period 
of time determined by the appropriate agency to be
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commensurate with such violation, practice, or 
breach, provided such period shall be not less than 2 
years. 
(2) PROCEDURES.—The due process require-
ments and other procedures under section 8(e) of the 
Federal Deposit Insurance Act shall apply to actions 
under this section as if the covered financial company 
were an insured depository institution and the senior 
executive or director were an institution-affiliated 
party, as those terms are defined in that Act. 
(d) REGULATIONS.—The Corporation and the Board 
of Governors, in consultation with the Council, shall jointly 
prescribe rules or regulations to administer and carry out 
this section, including rules, regulations, or guidelines to 
further define the term senior executive for the purposes of 
this section. 
SEC. 214. PROHIBITION ON TAXPAYER FUNDING. 
(a) LIQUIDATION REQUIRED.—All financial compa-
nies put into receivership under this title shall be liq-
uidated. No taxpayer funds shall be used to prevent the liq-
uidation of any financial company under this title. 
(b) RECOVERY OF FUNDS.—All funds expended in the 
liquidation of a financial company under this title shall 
be recovered from the disposition of assets of such financial
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† HR 4173 EAS 
company, or shall be the responsibility of the financial sec-
tor, through assessments. 
(c) NO LOSSES TO TAXPAYERS.—Taxpayers shall bear 
no losses from the exercise of any authority under this title. 
TITLE III—TRANSFER OF POW-
ERS TO THE COMPTROLLER 
OF THE CURRENCY, THE COR-
PORATION, AND THE BOARD 
OF GOVERNORS 
SEC. 300. SHORT TITLE. 
This title may be cited as the ‘‘Enhancing Financial 
Institution Safety and Soundness Act of 2010’’. 
SEC. 301. PURPOSES. 
The purposes of this title are— 
(1) to provide for the safe and sound operation 
of the banking system of the United States; 
(2) to preserve and protect the dual system of 
Federal and State-chartered depository institutions; 
(3) to ensure the fair and appropriate super-
vision of each depository institution, regardless of the 
size or type of charter of the depository institution; 
and 
(4) to streamline and rationalize the supervision 
of depository institutions and the holding companies 
of depository institutions.
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SEC. 302. DEFINITION. 
In this title, the term ‘‘transferred employee’’ means, 
as the context requires, an employee transferred to the Office 
of the Comptroller of the Currency or the Corporation under 
section 322. 
Subtitle A—Transfer of Powers and 
Duties 
SEC. 311. TRANSFER DATE. 
(a) TRANSFER DATE.—Except as provided in sub-
section (b), the term ‘‘transfer date’’ means the date that 
is 1 year after the date of enactment of this Act. 
(b) EXTENSION PERMITTED.— 
(1) NOTICE REQUIRED.—The Secretary, in con-
sultation with the Comptroller of the Currency, the 
Director of the Office of Thrift Supervision, the 
Chairman of the Board of Governors, and the Chair-
person of the Corporation, may extend the period 
under subsection (a) and designate a transfer date 
that is not later than 18 months after the date of en-
actment of this Act, if the Secretary transmits to the 
Committee on Banking, Housing, and Urban Affairs 
of the Senate and the Committee on Financial Serv-
ices of the House of Representatives— 
(A) a written determination that commence-
ment of the orderly process to implement this
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† HR 4173 EAS 
title is not feasible by the date that is 1 year 
after the date of enactment of this Act; 
(B) an explanation of why an extension is 
necessary to commence the process of orderly im-
plementation of this title; 
(C) the transfer date designated under this 
subsection; and 
(D) a description of the steps that will be 
taken to initiate the process of an orderly and 
timely implementation of this title within the ex-
tended time period. 
(2) PUBLICATION OF NOTICE.—Not later than 
270 days after the date of enactment of this Act, the 
Secretary shall publish in the Federal Register notice 
of any transfer date designated under paragraph (1). 
SEC. 312. POWERS AND DUTIES TRANSFERRED. 
(a) EFFECTIVE DATE.—This section, and the amend-
ments made by this section, shall take effect on the transfer 
date. 
(b) FUNCTIONS OF THE OFFICE OF THRIFT SUPER-
VISION.— 
(1) SAVINGS AND LOAN HOLDING COMPANY FUNC-
TIONS TRANSFERRED.—There are transferred to the 
Board of Governors all functions of the Office of 
Thrift Supervision and the Director of the Office of
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† HR 4173 EAS 
Thrift Supervision (including the authority to issue 
orders) relating to— 
(A) the supervision of— 
(i) any savings and loan holding com-
pany; and 
(ii) any subsidiary (other than a de-
pository institution) of a savings and loan 
holding company; and 
(B) all rulemaking authority of the Office of 
Thrift Supervision and the Director of the Office 
of Thrift Supervision relating to savings and 
loan holding companies. 
(2) ALL OTHER FUNCTIONS TRANSFERRED.— 
(A) BOARD
OF
GOVERNORS.—All rule-
making authority of the Office of Thrift Super-
vision and the Director of the Office of Thrift 
Supervision under section 11 of the Home Own-
ers’ Loan Act (12 U.S.C. 1468) relating to trans-
actions with affiliates and extensions of credit to 
executive officers, directors, and principal share-
holders and under section 5(q) of such Act relat-
ing to tying arrangements is transferred to the 
Board of Governors. 
(B) COMPTROLLER
OF
THE
CURRENCY.— 
Except as provided in paragraph (1) and sub-
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† HR 4173 EAS 
paragraph (A), there are transferred to the 
Comptroller of the Currency all functions of the 
Office of Thrift Supervision and the Director of 
the Office of Thrift Supervision relating to Fed-
eral savings associations. 
(C) CORPORATION.—Except as provided in 
paragraph (1) and subparagraph (A), all func-
tions of the Office of Thrift Supervision and the 
Director of the Office of Thrift Supervision relat-
ing to State savings associations are transferred 
to the Corporation. 
(D) COMPTROLLER OF THE CURRENCY AND 
THE
CORPORATION.—Except as provided in 
paragraph (1) and subparagraph (A), all rule-
making authority of the Office of Thrift Super-
vision and the Director of the Office of Thrift 
Supervision relating to savings associations is 
transferred to the Office of the Comptroller of the 
Currency. 
(c) CONFORMING AMENDMENTS.— 
(1) FEDERAL DEPOSIT INSURANCE ACT.—Section 
3(q) of the Federal Deposit Insurance Act (12 U.S.C. 
1813(q)) is amended by striking paragraphs (1) 
through (4) and inserting the following:
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† HR 4173 EAS 
‘‘(1) the Office of the Comptroller of the Cur-
rency, in the case of— 
‘‘(A) any national banking association; 
‘‘(B) any Federal branch or agency of a for-
eign bank; and 
‘‘(C) any Federal savings association; 
‘‘(2) the Federal Deposit Insurance Corporation, 
in the case of— 
‘‘(A) any insured State nonmember bank; 
‘‘(B) any foreign bank having an insured 
branch; and 
‘‘(C) any State savings association; 
‘‘(3) the Board of Governors of the Federal Re-
serve System, in the case of— 
‘‘(A) any State member bank; 
‘‘(B) any branch or agency of a foreign 
bank with respect to any provision of the Federal 
Reserve Act which is made applicable under the 
International Banking Act of 1978; 
‘‘(C) any foreign bank which does not oper-
ate an insured branch; 
‘‘(D) any agency or commercial lending 
company other than a Federal agency; 
‘‘(E) supervisory or regulatory proceedings 
arising from the authority given to the Board of
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† HR 4173 EAS 
Governors under section 7(c)(1) of the Inter-
national Banking Act of 1978, including such 
proceedings under the Financial Institutions Su-
pervisory Act of 1966; 
‘‘(F) any bank holding company and any 
subsidiary (other than a depository institution) 
of a bank holding company; and 
‘‘(G) any savings and loan holding com-
pany and any subsidiary (other than a deposi-
tory institution) of a savings and loan holding 
company.’’. 
(2) FEDERAL DEPOSIT INSURANCE ACT.— 
(A) APPLICATION.—Section 8(b)(3) of the 
Federal Deposit Insurance Act (12 U.S.C. 
1818(b)(3)) is amended to read as follows: 
‘‘(3) APPLICATION TO BANK HOLDING COMPANIES, 
SAVINGS AND LOAN HOLDING COMPANIES, AND EDGE AND 
AGREEMENT CORPORATIONS.— 
‘‘(A) APPLICATION.—This subsection, subsections 
(c) through (s) and subsection (u) of this section, and 
section 50 shall apply to— 
‘‘(i) any bank holding company, and any 
subsidiary (other than a bank) of a bank holding 
company, as those terms are defined in section 
2 of the Bank Holding Company Act of 1956 (12
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† HR 4173 EAS 
U.S.C. 1841), as if such company or subsidiary 
was an insured depository institution for which 
the appropriate Federal banking agency for the 
bank holding company was the appropriate Fed-
eral banking agency; 
‘‘(ii) any savings and loan holding com-
pany, and any subsidiary (other than a deposi-
tory institution) of a savings and loan holding 
company, as those terms are defined in section 
10 of the Home Owners’ Loan Act (12 U.S.C. 
1467a), as if such company or subsidiary was 
an insured depository institution for which the 
appropriate Federal banking agency for the sav-
ings and loan holding company was the appro-
priate Federal banking agency; and 
‘‘(iii) any organization organized and oper-
ated under section 25A of the Federal Reserve 
Act (12 U.S.C. 611 et seq.) or operating under 
section 25 of the Federal Reserve Act (12 U.S.C. 
601 et seq.) and any noninsured State member 
bank, as if such organization or bank was a 
bank holding company. 
‘‘(B) RULES OF CONSTRUCTION.— 
‘‘(i) EFFECT ON OTHER AUTHORITY.—Noth-
ing in this paragraph may be construed to alter
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† HR 4173 EAS 
or affect the authority of an appropriate Federal 
banking agency to initiate enforcement pro-
ceedings, issue directives, or take other remedial 
action under any other provision of law. 
‘‘(ii) HOLDING
COMPANIES.—Nothing in 
this paragraph or subsection (c) may be con-
strued as authorizing any Federal banking agen-
cy other than the appropriate Federal banking 
agency for a bank holding company or a savings 
and loan holding company to initiate enforce-
ment proceedings, issue directives, or take other 
remedial action against a bank holding com-
pany, a savings and loan holding company, or 
any subsidiary thereof (other than a depository 
institution).’’. 
(B) 
CONFORMING
AMENDMENT.—Section 
8(b)(9) of the Federal Deposit Insurance Act (12 
U.S.C. 1818(b)(9)) is amended to read as follows: 
‘‘(9) [Reserved].’’. 
(d) CONSUMER PROTECTION.—Nothing in this section 
may be construed to limit or otherwise affect the transfer 
of powers under title X.
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SEC. 313. ABOLISHMENT. 
Effective 90 days after the transfer date, the Office of 
Thrift Supervision and the position of Director of the Office 
of Thrift Supervision are abolished. 
SEC. 314. 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. 
‘‘(a) OFFICE OF THE COMPTROLLER OF THE CUR-
RENCY ESTABLISHED.—There is established in the Depart-
ment of the Treasury a bureau to be known as the ‘Office 
of the Comptroller of the Currency’ which is charged with 
assuring the safety and soundness of, and compliance with 
laws and regulations, fair access to financial services, and 
fair treatment of customers by, the institutions and other 
persons subject to its jurisdiction. 
‘‘(b) COMPTROLLER OF THE CURRENCY.— 
‘‘(1) IN GENERAL.—The chief officer of the Office 
of the Comptroller of the Currency shall be known as 
the Comptroller of the Currency. The Comptroller of 
the Currency shall perform the duties of the Comp-
troller of the Currency under the general direction of 
the Secretary of the Treasury. The Secretary of the 
Treasury may not delay or prevent the issuance of 
any rule or the promulgation of any regulation by the
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† HR 4173 EAS 
Comptroller of the Currency, and may not intervene 
in any matter or proceeding before the Comptroller of 
the Currency (including agency enforcement actions), 
unless otherwise specifically provided by law. 
‘‘(2) ADDITIONAL AUTHORITY.—The Comptroller 
of the Currency shall have the same authority with 
respect to functions transferred to the Comptroller of 
the Currency under the Enhancing Financial Institu-
tion Safety and Soundness Act of 2010 (including 
matters that were within the jurisdiction of the Direc-
tor of the Office of Thrift Supervision or the Office of 
Thrift Supervision on the day before the transfer date 
under that Act) as was vested in the Director of the 
Office of Thrift Supervision on the transfer date 
under that Act.’’. 
(b) AMENDMENT TO SECTION 329.—Section 329 of the 
Revised Statutes of the United States (12 U.S.C. 11) is 
amended by inserting before the period at the end the fol-
lowing: ‘‘or any Federal savings association’’. 
(c) EFFECTIVE DATE.—This section, and the amend-
ments made by this section, shall take effect on the transfer 
date.
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† HR 4173 EAS 
SEC. 315. FEDERAL INFORMATION POLICY. 
Section 3502(5) of title 44, United States Code, is 
amended by inserting ‘‘Office of the Comptroller of the Cur-
rency,’’ after ‘‘the Securities and Exchange Commission,’’. 
SEC. 316. SAVINGS PROVISIONS. 
(a) OFFICE OF THRIFT SUPERVISION.— 
(1) EXISTING
RIGHTS, DUTIES, AND
OBLIGA-
TIONS NOT AFFECTED.—Sections 312(b) and 313 shall 
not affect the validity of any right, duty, or obliga-
tion of the United States, the Director of the Office 
of Thrift Supervision, the Office of Thrift Super-
vision, or any other person, that existed on the day 
before the transfer date. 
(2) CONTINUATION OF SUITS.—This title shall 
not abate any action or proceeding commenced by or 
against the Director of the Office of Thrift Super-
vision or the Office of Thrift Supervision before the 
transfer date, except that, for any action or pro-
ceeding arising out of a function of the Director of the 
Office of Thrift Supervision or the Office of Thrift Su-
pervision that is transferred to the Comptroller of the 
Currency, the Office of the Comptroller of the Cur-
rency, the Chairperson of the Corporation, the Cor-
poration, the Chairman of the Board of Governors, or 
the Board of Governors by this subtitle, the Comp-
troller of the Currency, the Office of the Comptroller
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† HR 4173 EAS 
of the Currency, the Chairperson of the Corporation, 
the Corporation, the Chairman of the Board of Gov-
ernors, or the Board of Governors shall be substituted 
for the Director of the Office of Thrift Supervision or 
the Office of Thrift Supervision, as appropriate, as a 
party to the action or proceeding as of the transfer 
date. 
(b) CONTINUATION OF EXISTING ORDERS, RESOLU-
TIONS, DETERMINATIONS, AGREEMENTS, REGULATIONS, 
AND OTHER MATERIALS.—All orders, resolutions, deter-
minations, agreements, regulations, interpretative rules, 
other interpretations, guidelines, procedures, and other ad-
visory materials that have been issued, made, prescribed, 
or allowed to become effective by the Office of Thrift Super-
vision, or by a court of competent jurisdiction, in the per-
formance of functions of the Office of Thrift Supervision 
that are transferred by this subtitle and that are in effect 
on the day before the transfer date, shall continue in effect 
according to the terms of those materials, and shall be en-
forceable by or against the Office of the Comptroller of the 
Currency, the Corporation, or the Board of Governors, as 
appropriate, until modified, terminated, set aside, or super-
seded in accordance with applicable law by the Office of 
the Comptroller of the Currency, the Corporation, or the
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† HR 4173 EAS 
Board of Governors, as appropriate, by any court of com-
petent jurisdiction, or by operation of law. 
(c) IDENTIFICATION OF REGULATIONS CONTINUED.— 
(1) BY THE OFFICE OF THE COMPTROLLER OF 
THE CURRENCY.—Not later than the transfer date, the 
Office of the Comptroller of the Currency shall— 
(A) in consultation with the Corporation, 
identify the regulations continued under sub-
section (b) that will be enforced by the Office of 
the Comptroller of the Currency; and 
(B) publish a list of such regulations in the 
Federal Register. 
(2) BY THE CORPORATION.—Not later than the 
transfer date, the Corporation shall— 
(A) in consultation with the Office of the 
Comptroller of the Currency, identify the regula-
tions continued under subsection (b) that will be 
enforced by the Corporation; and 
(B) publish a list of such regulations in the 
Federal Register. 
(3) BY THE BOARD OF GOVERNORS.—Not later 
than the transfer date, the Board of Governors shall— 
(A) in consultation with the Office of the 
Comptroller of the Currency and the Corpora-
tion, identify the regulations continued under
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† HR 4173 EAS 
subsection (b) that will be enforced by the Board 
of Governors; and 
(B) publish a list of such regulations in the 
Federal Register. 
(d) STATUS OF REGULATIONS PROPOSED OR NOT YET 
EFFECTIVE.— 
(1) PROPOSED
REGULATIONS.—Any proposed 
regulation of the Office of Thrift Supervision that the 
Office of Thrift Supervision, in performing functions 
transferred by this subtitle, has proposed before the 
transfer date, but has not published as a final regula-
tion before that date, shall be deemed to be a proposed 
regulation of the Office of the Comptroller of the Cur-
rency or the Board of Governors, as appropriate, ac-
cording to its terms. 
(2) REGULATIONS
NOT
YET
EFFECTIVE.—Any 
interim or final regulation of the Office of Thrift Su-
pervision that the Office of Thrift Supervision, in 
performing functions transferred by this subtitle, has 
published before the transfer date, but which has not 
become effective before that date, shall become effective 
as a regulation of the Office of the Comptroller of the 
Currency or the Board of Governors, as appropriate, 
according to its terms.
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† HR 4173 EAS 
SEC. 317. REFERENCES IN FEDERAL LAW TO FEDERAL 
BANKING AGENCIES. 
Except as provided in section 312(d)(2), on and after 
the transfer date, any reference in Federal law to the Direc-
tor of the Office of Thrift Supervision or the Office of Thrift 
Supervision, in connection with any function of the Direc-
tor of the Office of Thrift Supervision or the Office of Thrift 
Supervision transferred under section 312(b) or any other 
provision of this subtitle, shall be deemed to be a reference 
to the Comptroller of the Currency, the Office of the Comp-
troller of the Currency, the Chairperson of the Corporation, 
the Corporation, the Chairman of the Board of Governors, 
or the Board of Governors, as appropriate. 
SEC. 318. FUNDING. 
(a) FUNDING OF OFFICE OF THE COMPTROLLER OF 
THE CURRENCY.—Chapter 4 of title LXII of the Revised 
Statutes is amended by inserting after section 5240 (12 
U.S.C. 481, 482) the following: 
‘‘SEC. 5240A. The Comptroller of the Currency may 
collect an assessment, fee, or other charge from any entity 
described in section 3(q)(1) of the Federal Deposit Insur-
ance Act (12 U.S.C. 1813(q)(1)), as the Comptroller deter-
mines is necessary or appropriate to carry out the respon-
sibilities of the Office of the Comptroller of the Currency. 
In establishing the amount of an assessment, fee, or charge 
collected from an entity under this section, the Comptroller
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† HR 4173 EAS 
of the Currency may take into account the funds transferred 
to the Office of the Comptroller of the Currency under this 
section, the nature and scope of the activities of the entity, 
the amount and type of assets that the entity holds, the fi-
nancial and managerial condition of the entity, and any 
other factor, as the Comptroller of the Currency determines 
is appropriate. Funds derived from any assessment, fee, or 
charge collected or payment made pursuant to this section 
may be deposited by the Comptroller of the Currency in 
accordance with the provisions of section 5234. Such funds 
shall not be construed to be Government funds or appro-
priated monies, and shall not be subject to apportionment 
for purposes of chapter 15 of title 31, United States Code, 
or any other provision of law. The authority of the Comp-
troller of the Currency under this section shall be in addi-
tion to the authority under section 5240. 
‘‘The Comptroller of the Currency shall have sole au-
thority to determine the manner in which the obligations 
of the Office of the Comptroller of the Currency shall be in-
curred and its disbursements and expenses allowed and 
paid, in accordance with this section.’’. 
(b) FUNDING OF BOARD OF GOVERNORS.—Section 11 
of the Federal Reserve Act (12 U.S.C. 248) is amended by 
adding at the end the following:
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† HR 4173 EAS 
‘‘(s) ASSESSMENTS, FEES, AND OTHER CHARGES FOR 
CERTAIN COMPANIES.— 
‘‘(1) IN GENERAL.—The Board shall collect a 
total amount of assessments, fees, or other charges 
from the companies described in paragraph (2) that 
is equal to the total expenses the Board estimates are 
necessary or appropriate to carry out the responsibil-
ities of the Board with respect to such companies. 
‘‘(2) COMPANIES.—The companies described in 
this paragraph are— 
‘‘(A) all bank holding companies having 
total consolidated assets of $50,000,000,000 or 
more; 
‘‘(B) all savings and loan holding compa-
nies 
having 
total 
consolidated 
assets 
of 
$50,000,000,000 or more; and 
‘‘(C) all nonbank financial companies su-
pervised by the Board under section 113 of the 
Restoring American Financial Stability Act of 
2010.’’. 
(c) CORPORATION EXAMINATION FEES.—Section 10(e) 
of the Federal Deposit Insurance Act (12 U.S.C. 1820(e)) 
is amended by striking paragraph (1) and inserting the fol-
lowing:
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† HR 4173 EAS 
‘‘(1) REGULAR AND SPECIAL EXAMINATIONS OF 
DEPOSITORY INSTITUTIONS.—The cost of conducting 
any regular examination or special examination of 
any depository institution under subsection (b)(2), 
(b)(3), or (d) or of any entity described in section 
3(q)(2) may be assessed by the Corporation against 
the institution or entity to meet the expenses of the 
Corporation in carrying out such examinations, or as 
the Corporation determines is necessary or appro-
priate to carry out the responsibilities of the Corpora-
tion.’’. 
(d) EFFECTIVE DATE.—This section, and the amend-
ments made by this section, shall take effect on the transfer 
date. 
SEC. 319. CONTRACTING AND LEASING AUTHORITY. 
Notwithstanding the Federal Property and Adminis-
trative Services Act of 1949 (41 U.S.C. 251 et seq.) or any 
other provision of law, the Office of the Comptroller of the 
Currency may— 
(1) enter into and perform contracts, execute in-
struments, and acquire, in any lawful manner, such 
goods and services, or personal or real property (or 
property interest) as the Comptroller deems necessary 
to carry out the duties and responsibilities of the Of-
fice of the Comptroller of the Currency; and
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(2) hold, maintain, sell, lease, or otherwise dis-
pose of the property (or property interest) acquired 
under paragraph (1). 
Subtitle B—Transitional Provisions 
SEC. 321. INTERIM USE OF FUNDS, PERSONNEL, AND PROP-
ERTY OF THE OFFICE OF THRIFT SUPER-
VISION. 
(a) IN GENERAL.—Before the transfer date, the Office 
of the Comptroller of the Currency, the Corporation, and 
the Board of Governors shall— 
(1) consult and cooperate with the Office of 
Thrift Supervision to facilitate the orderly transfer of 
functions to the Office of the Comptroller of the Cur-
rency, the Corporation, and the Board of Governors 
in accordance with this title; 
(2) determine jointly, from time to time— 
(A) the amount of funds necessary to pay 
any expenses associated with the transfer of func-
tions (including expenses for personnel, property, 
and administrative services) during the period 
beginning on the date of enactment of this Act 
and ending on the transfer date; 
(B) which personnel are appropriate to fa-
cilitate the orderly transfer of functions by this 
title; and
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† HR 4173 EAS 
(C) what property and administrative serv-
ices are necessary to support the Office of the 
Comptroller of the Currency, the Corporation, 
and the Board of Governors during the period 
beginning on the date of enactment of this Act 
and ending on the transfer date; and 
(3) take such actions as may be necessary to pro-
vide for the orderly implementation of this title. 
(b) AGENCY CONSULTATION.—When requested jointly 
by the Office of the Comptroller of the Currency, the Cor-
poration, and the Board of Governors to do so before the 
transfer date, the Office of Thrift Supervision shall— 
(1) pay to the Office of the Comptroller of the 
Currency, the Corporation, or the Board of Governors, 
as applicable, from funds obtained by the Office of 
Thrift Supervision through assessments, fees, or other 
charges that the Office of Thrift Supervision is au-
thorized by law to impose, such amounts as the Office 
of the Comptroller of the Currency, the Corporation, 
and the Board of Governors jointly determine to be 
necessary under subsection (a); 
(2) detail to the Office of the Comptroller of the 
Currency, the Corporation, or the Board of Governors, 
as applicable, such personnel as the Office of the 
Comptroller of the Currency, the Corporation, and the
340 
† HR 4173 EAS 
Board of Governors jointly determine to be appro-
priate under subsection (a); and 
(3) make available to the Office of the Comp-
troller of the Currency, the Corporation, or the Board 
of Governors, as applicable, such property and pro-
vide to the Office of the Comptroller of the Currency, 
the Corporation, or the Board of Governors, as appli-
cable, such administrative services as the Office of the 
Comptroller of the Currency, the Corporation, and the 
Board of Governors jointly determine to be necessary 
under subsection (a). 
(c) NOTICE REQUIRED.—The Office of the Comptroller 
of the Currency, the Corporation, and the Board of Gov-
ernors shall jointly give the Office of Thrift Supervision rea-
sonable prior notice of any request that the Office of the 
Comptroller of the Currency, the Corporation, and the 
Board of Governors jointly intend to make under subsection 
(b). 
SEC. 322. TRANSFER OF EMPLOYEES. 
(a) IN GENERAL.— 
(1) OFFICE OF THRIFT SUPERVISION EMPLOY-
EES.— 
(A) IN GENERAL.—All employees of the Of-
fice of Thrift Supervision shall be transferred to 
the Office of the Comptroller of the Currency or
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† HR 4173 EAS 
the Corporation for employment in accordance 
with this section. 
(B) ALLOCATING EMPLOYEES FOR TRANS-
FER TO RECEIVING AGENCIES.—The Director of 
the Office of Thrift Supervision, the Comptroller 
of the Currency, and the Chairperson of the Cor-
poration shall— 
(i) jointly determine the number of em-
ployees of the Office of Thrift Supervision 
necessary to perform or support the func-
tions that are transferred to the Office of the 
Comptroller of the Currency or the Corpora-
tion by this title; and 
(ii) consistent with the determination 
under clause (i), jointly identify employees 
of the Office of Thrift Supervision for trans-
fer to the Office of the Comptroller of the 
Currency or the Corporation. 
(2) EMPLOYEES TRANSFERRED; SERVICE PERI-
ODS CREDITED.—For purposes of this section, periods 
of service with a Federal home loan bank, a joint of-
fice of Federal home loan banks, or a Federal reserve 
bank shall be credited as periods of service with a 
Federal agency.
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† HR 4173 EAS 
(3) APPOINTMENT
AUTHORITY
FOR
EXCEPTED 
SERVICE TRANSFERRED.— 
(A) IN GENERAL.—Except as provided in 
subparagraph (B), any appointment authority of 
the Office of Thrift Supervision under Federal 
law that relates to the functions transferred 
under section 312, including the regulations of 
the Office of Personnel Management, for filling 
the positions of employees in the excepted service 
shall be transferred to the Comptroller of the 
Currency or the Chairperson of the Corporation, 
as appropriate. 
(B) DECLINING TRANSFERS ALLOWED.—The 
Office of the Comptroller of the Currency or the 
Chairperson of the Corporation may decline to 
accept a transfer of authority under subpara-
graph (A) (and the employees appointed under 
that authority) to the extent that such authority 
relates to positions excepted from the competitive 
service because of their confidential, policy-mak-
ing, policy-determining, or policy-advocating 
character. 
(4) ADDITIONAL
APPOINTMENT
AUTHORITY.— 
Notwithstanding any other provision of law, the Of-
fice of the Comptroller of the Currency and the Cor-
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† HR 4173 EAS 
poration may appoint transferred employees to posi-
tions in the Office of the Comptroller of the Currency 
or the Corporation, respectively. 
(b) TIMING OF TRANSFERS AND POSITION ASSIGN-
MENTS.—Each employee to be transferred under subsection 
(a)(1) shall— 
(1) be transferred not later than 90 days after 
the transfer date; and 
(2) receive notice of the position assignment of 
the employee not later than 120 days after the effec-
tive date of the transfer of the employee. 
(c) TRANSFER OF FUNCTIONS.— 
(1) IN
GENERAL.—Notwithstanding any other 
provision of law, the transfer of employees under this 
subtitle shall be deemed a transfer of functions for the 
purpose of section 3503 of title 5, United States Code. 
(2) PRIORITY.—If any provision of this subtitle 
conflicts with any protection provided to a trans-
ferred employee under section 3503 of title 5, United 
States Code, the provisions of this subtitle shall con-
trol. 
(d) EMPLOYEE STATUS AND ELIGIBILITY.—The trans-
fer of functions and employees under this subtitle, and the 
abolishment of the Office of Thrift Supervision under sec-
tion 313, shall not affect the status of the transferred em-
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† HR 4173 EAS 
ployees as employees of an agency of the United States 
under any provision of law. 
(e) EQUAL STATUS AND TENURE POSITIONS.— 
(1) STATUS AND TENURE.—Each transferred em-
ployee from the Office of Thrift Supervision shall be 
placed in a position at the Office of the Comptroller 
of the Currency or the Corporation with the same sta-
tus and tenure as the transferred employee held on the 
day before the date on which the employee was trans-
ferred. 
(2) FUNCTIONS.—To the extent practicable, each 
transferred employee shall be placed in a position at 
the Office of the Comptroller of the Currency or the 
Corporation, as applicable, responsible for the same 
functions and duties as the transferred employee had 
on the day before the date on which the employee was 
transferred, in accordance with the expertise and pref-
erences of the transferred employee. 
(f) 
NO
ADDITIONAL
CERTIFICATION
REQUIRE-
MENTS.—An examiner who is a transferred employee shall 
not be subject to any additional certification requirements 
before being placed in a comparable position at the Office 
of the Comptroller of the Currency or the Corporation, if 
the examiner carries out examinations of the same type of 
institutions as an employee of the Office of the Comptroller
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† HR 4173 EAS 
of the Currency or the Corporation as the employee was 
responsible for carrying out before the date on which the 
employee was transferred. 
(g) PERSONNEL ACTIONS LIMITED.— 
(1) 2-YEAR PROTECTION.—Except as provided in 
paragraph (2), during the 2-year period beginning on 
the transfer date, an employee holding a permanent 
position on the day before the date on which the em-
ployee was transferred shall not be involuntarily sep-
arated or involuntarily reassigned outside the locality 
pay area (as defined by the Office of Personnel Man-
agement) of the employee. 
(2) EXCEPTIONS.—The Comptroller of the Cur-
rency and the Chairperson of the Corporation, as ap-
plicable, may— 
(A) separate a transferred employee for 
cause, including for unacceptable performance; 
or 
(B) terminate an appointment to a position 
excepted from the competitive service because of 
its 
confidential 
policy-making, 
policy-deter-
mining, or policy-advocating character. 
(h) PAY.— 
(1) 2-YEAR PROTECTION.—Except as provided in 
paragraph (2), during the 2-year period beginning on
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† HR 4173 EAS 
the date on which the employee was transferred under 
this subtitle, a transferred employee shall be paid at 
a rate that is not less than the basic rate of pay, in-
cluding any geographic differential, that the trans-
ferred employee received during the pay period imme-
diately preceding the date on which the employee was 
transferred. 
(2) EXCEPTIONS.—The Comptroller of the Cur-
rency or the Chairman of the Board of Governors 
may reduce the rate of basic pay of a transferred em-
ployee— 
(A) for cause, including for unacceptable 
performance; or 
(B) with the consent of the transferred em-
ployee. 
(3) PROTECTION ONLY WHILE EMPLOYED.—This 
subsection shall apply to a transferred employee only 
during the period that the transferred employee re-
mains employed by Office of the Comptroller of the 
Currency or the Corporation. 
(4) PAY
INCREASES
PERMITTED.—Nothing in 
this subsection shall limit the authority of the Comp-
troller of the Currency or the Chairperson of the Cor-
poration to increase the pay of a transferred em-
ployee.
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† HR 4173 EAS 
(i) BENEFITS.— 
(1) RETIREMENT BENEFITS FOR TRANSFERRED 
EMPLOYEES.— 
(A) IN GENERAL.— 
(i) CONTINUATION
OF
EXISTING
RE-
TIREMENT
PLAN.—Each transferred em-
ployee shall remain enrolled in the retire-
ment plan of the transferred employee, for 
as long as the transferred employee is em-
ployed by the Office of the Comptroller of 
the Currency or the Corporation. 
(ii) EMPLOYER’S CONTRIBUTION.—The 
Comptroller of the Currency or the Chair-
person of the Corporation, as appropriate, 
shall pay any employer contributions to the 
existing retirement plan of each transferred 
employee, as required under each such exist-
ing retirement plan. 
(B) DEFINITION.—In this paragraph, the 
term ‘‘existing retirement plan’’ means, with re-
spect to a transferred employee, the retirement 
plan (including the Financial Institutions Re-
tirement Fund), and any associated thrift sav-
ings plan, of the agency from which the employee 
was transferred in which the employee was en-
348 
† HR 4173 EAS 
rolled on the day before the date on which the 
employee was transferred. 
(2) BENEFITS OTHER THAN RETIREMENT BENE-
FITS.— 
(A) DURING FIRST YEAR.— 
(i) EXISTING PLANS CONTINUE.—Dur-
ing the 1-year period following the transfer 
date, each transferred employee may retain 
membership in any employee benefit pro-
gram (other than a retirement benefit pro-
gram) of the agency from which the em-
ployee was transferred under this title, in-
cluding any dental, vision, long term care, 
or life insurance program to which the em-
ployee belonged on the day before the trans-
fer date. 
(ii) EMPLOYER’S CONTRIBUTION.—The 
Office of the Comptroller of the Currency or 
the Corporation, as appropriate, shall pay 
any employer cost required to extend cov-
erage in the benefit program to the trans-
ferred employee as required under that pro-
gram or negotiated agreements. 
(B) DENTAL, VISION, OR LIFE INSURANCE 
AFTER FIRST YEAR.—If, after the 1-year period
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† HR 4173 EAS 
of the Currency or the Corporation determines 
that the Office of the Comptroller of the Currency 
or the Corporation, as appropriate, will not con-
tinue to participate in any long term care insur-
ance program of an agency from which an em-
ployee transferred, a transferred employee who is 
a member of such a program may, before the de-
cision takes effect, elect to apply for coverage 
under the Federal Long Term Care Insurance 
Program established under chapter 90 of title 5, 
United States Code, under the underwriting re-
quirements applicable to a new active workforce 
member, as described in part 875 of title 5, Code 
of Federal Regulations (or any successor thereto). 
(D) CONTRIBUTION OF TRANSFERRED EM-
PLOYEE.— 
(i) IN
GENERAL.—Subject to clause 
(ii), a transferred employee who is enrolled 
in a plan under the Federal Employees 
Health Benefits Program shall pay any em-
ployee contribution required under the plan. 
(ii) COST DIFFERENTIAL.—The Office 
of the Comptroller of the Currency or the 
Corporation, as applicable, shall pay any 
difference in cost between the employee con-
351 
† HR 4173 EAS 
tribution required under the plan provided 
to transferred employees by the agency from 
which the employee transferred on the date 
of enactment of this Act and the plan pro-
vided by the Office of the Comptroller of the 
Currency or the Corporation, as the case 
may be, under this section. 
(iii) FUNDS TRANSFER.—The Office of 
the Comptroller of the Currency or the Cor-
poration, as the case may be, shall transfer 
to the Employees Health Benefits Fund es-
tablished under section 8909 of title 5, 
United States Code, an amount determined 
by the Director of the Office of Personnel 
Management, after consultation with the 
Comptroller of the Currency or the Chair-
person of the Corporation, as the case may 
be, and the Office of Management and 
Budget, to be necessary to reimburse the 
Fund for the cost to the Fund of providing 
any benefits under this subparagraph that 
are not otherwise paid for by a transferred 
employee under clause (i). 
(E) SPECIAL PROVISIONS TO ENSURE CON-
TINUATION OF LIFE INSURANCE BENEFITS.—
352 
† HR 4173 EAS 
(i) IN
GENERAL.—An annuitant, as 
defined in section 8901 of title 5, United 
States Code, who is enrolled in a life insur-
ance plan administered by an agency from 
which employees are transferred under this 
title on the day before the transfer date shall 
be eligible for coverage by a life insurance 
plan under sections 8706(b), 8714a, 8714b, 
or 8714c of title 5, United States Code, or 
by a life insurance plan established by the 
Office of the Comptroller of the Currency or 
the Corporation, as applicable, without re-
gard to any regularly scheduled open season 
or any requirement of insurability. 
(ii) CONTRIBUTION OF TRANSFERRED 
EMPLOYEE.— 
(I) IN GENERAL.—Subject to sub-
clause (II), a transferred employee en-
rolled in a life insurance plan under 
this subparagraph shall pay any em-
ployee contribution required by the 
plan. 
(II) COST
DIFFERENTIAL.—The 
Office of the Comptroller of the Cur-
rency or the Corporation, as the case
353 
† HR 4173 EAS 
may be, shall pay any difference in 
cost between the benefits provided by 
the agency from which the employee 
transferred on the date of enactment of 
this Act and the benefits provided 
under this section. 
(III) FUNDS TRANSFER.—The Of-
fice of the Comptroller of the Currency 
or the Corporation, as the case may be, 
shall transfer to the Federal Employ-
ees’ Group Life Insurance Fund estab-
lished under section 8714 of title 5, 
United States Code, an amount deter-
mined by the Director of the Office of 
Personnel Management, after consulta-
tion with the Comptroller of the Cur-
rency or the Chairperson of the Cor-
poration, as the case may be, and the 
Office of Management and Budget, to 
be necessary to reimburse the Federal 
Employees’ 
Group 
Life 
Insurance 
Fund for the cost to the Federal Em-
ployees’ Group Life Insurance Fund of 
providing benefits under this subpara-
graph not otherwise paid for by a
354 
† HR 4173 EAS 
transferred employee under subclause 
(I). 
(IV) CREDIT FOR TIME ENROLLED 
IN
OTHER
PLANS.—For any trans-
ferred employee, enrollment in a life 
insurance plan administered by the 
agency from which the employee trans-
ferred, immediately before enrollment 
in a life insurance plan under chapter 
87 of title 5, United States Code, shall 
be considered as enrollment in a life 
insurance plan under that chapter for 
purposes of section 8706(b)(1)(A) of 
title 5, United States Code. 
(j) INCORPORATION INTO AGENCY PAY SYSTEM.—Not 
later than 2 years after the transfer date, the Comptroller 
of the Currency and the Chairperson of the Corporation 
shall place each transferred employee into the established 
pay system and structure of the appropriate employing 
agency. 
(k) EQUITABLE TREATMENT.—In administering the 
provisions of this section, the Comptroller of the Currency 
and the Chairperson of the Corporation— 
(1) may not take any action that would unfairly 
disadvantage a transferred employee relative to any
355 
† HR 4173 EAS 
other employee of the Office of the Comptroller of the 
Currency or the Corporation on the basis of prior em-
ployment by the Office of Thrift Supervision; and 
(2) may take such action as is appropriate in an 
individual case to ensure that a transferred employee 
receives equitable treatment, with respect to the sta-
tus, tenure, pay, benefits (other than benefits under 
programs administered by the Office of Personnel 
Management), and accrued leave or vacation time for 
prior periods of service with any Federal agency of 
the transferred employee. 
(l) REORGANIZATION.— 
(1) IN GENERAL.—If the Comptroller of the Cur-
rency or the Chairperson of the Corporation deter-
mines, during the 2-year period beginning 1 year 
after the transfer date, that a reorganization of the 
staff of the Office of the Comptroller of the Currency 
or the Corporation, respectively, is required, the reor-
ganization shall be deemed a ‘‘major reorganization’’ 
for purposes of affording affected employees retirement 
under section 8336(d)(2) or 8414(b)(1)(B) of title 5, 
United States Code. 
(2) SERVICE CREDIT.—For purposes of this sub-
section, periods of service with a Federal home loan 
bank or a joint office of Federal home loan banks
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† HR 4173 EAS 
shall be credited as periods of service with a Federal 
agency. 
SEC. 323. PROPERTY TRANSFERRED. 
(a) PROPERTY DEFINED.—For purposes of this sec-
tion, the term ‘‘property’’ includes all real property (includ-
ing leaseholds) and all personal property, including com-
puters, furniture, fixtures, equipment, books, accounts, 
records, reports, files, memoranda, paper, reports of exam-
ination, work papers, and correspondence related to such 
reports, and any other information or materials. 
(b) PROPERTY OF THE OFFICE OF THRIFT SUPER-
VISION.—Not later than 90 days after the transfer date, all 
property of the Office of Thrift Supervision that the Comp-
troller of the Currency and the Chairperson of the Corpora-
tion jointly determine is used, on the day before the transfer 
date, to perform or support the functions of the Office of 
Thrift Supervision transferred to the Office of the Comp-
troller of the Currency or the Corporation under this title, 
shall be transferred to the Office of the Comptroller of the 
Currency or the Corporation in a manner consistent with 
the transfer of employees under this subtitle. 
(c) CONTRACTS
RELATED
TO
PROPERTY
TRANS-
FERRED.—Each contract, agreement, lease, license, permit, 
and similar arrangement relating to property transferred 
to the Office of the Comptroller of the Currency or the Cor-
357 
† HR 4173 EAS 
poration by this section shall be transferred to the Office 
of the Comptroller of the Currency or the Corporation, as 
appropriate, together with the property to which it relates. 
(d) PRESERVATION OF PROPERTY.—Property identi-
fied for transfer under this section shall not be altered, de-
stroyed, or deleted before transfer under this section. 
SEC. 324. FUNDS TRANSFERRED. 
The funds that, on the day before the transfer date, 
the Director of the Office of Thrift Supervision (in consulta-
tion with the Comptroller of the Currency, the Chairperson 
of the Corporation, and the Chairman of the Board of Gov-
ernors) determines are not necessary to dispose of the affairs 
of the Office of Thrift Supervision under section 325 and 
are available to the Office of Thrift Supervision to pay the 
expenses of the Office of Thrift Supervision— 
(1) relating to the functions of the Office of 
Thrift 
Supervision 
transferred 
under 
section 
312(b)(1)(B), shall be transferred to the Office of the 
Comptroller of the Currency on the transfer date; 
(2) relating to the functions of the Office of 
Thrift 
Supervision 
transferred 
under 
section 
312(b)(1)(C), shall be transferred to the Corporation 
on the transfer date; and 
(3) relating to the functions of the Office of 
Thrift 
Supervision 
transferred 
under 
section
358 
† HR 4173 EAS 
312(b)(1)(A), shall be transferred to the Board of Gov-
ernors on the transfer date. 
SEC. 325. DISPOSITION OF AFFAIRS. 
(a) AUTHORITY OF DIRECTOR.—During the 90-day 
period beginning on the transfer date, the Director of the 
Office of Thrift Supervision— 
(1) shall, solely for the purpose of winding up 
the affairs of the Office of Thrift Supervision relating 
to any function transferred to the Office of the Comp-
troller of the Currency, the Corporation, or the Board 
of Governors under this title— 
(A) manage the employees of the Office of 
Thrift Supervision who have not yet been trans-
ferred and provide for the payment of the com-
pensation and benefits of the employees that ac-
crue before the date on which the employees are 
transferred under this title; and 
(B) manage any property of the Office of 
Thrift Supervision, until the date on which the 
property is transferred under section 323; and 
(2) may take any other action necessary to wind 
up the affairs of the Office of Thrift Supervision. 
(b) STATUS OF DIRECTOR.— 
(1) IN GENERAL.—Notwithstanding the transfer 
of functions under this subtitle, during the 90-day pe-
359 
† HR 4173 EAS 
riod beginning on the transfer date, the Director of 
the Office of Thrift Supervision shall retain and may 
exercise any authority vested in the Director of the 
Office of Thrift Supervision on the day before the 
transfer date, only to the extent necessary— 
(A) to wind up the Office of Thrift Super-
vision; and 
(B) to carry out the transfer under this sub-
title during such 90-day period. 
(2) OTHER PROVISIONS.—For purposes of para-
graph (1), the Director of the Office of Thrift Super-
vision shall, during the 90-day period beginning on 
the transfer date, continue to be— 
(A) treated as an officer of the United 
States; and 
(B) entitled to receive compensation at the 
same annual rate of basic pay that the Director 
of the Office of Thrift Supervision received on the 
day before the transfer date. 
SEC. 326. CONTINUATION OF SERVICES. 
Any agency, department, or other instrumentality of 
the United States, and any successor to any such agency, 
department, or instrumentality, that was, before the trans-
fer date, providing support services to the Office of Thrift 
Supervision in connection with functions transferred to the
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† HR 4173 EAS 
Office of the Comptroller of the Currency, the Corporation 
or the Board of Governors under this title, shall— 
(1) continue to provide such services, subject to 
reimbursement by the Office of the Comptroller of the 
Currency, the Corporation, or the Board of Governors, 
until the transfer of functions under this title is com-
plete; and 
(2) consult with the Comptroller of the Currency, 
the Chairperson of the Corporation, or the Chairman 
of the Board of Governors, as appropriate, to coordi-
nate and facilitate a prompt and orderly transition. 
Subtitle C—Federal Deposit 
Insurance Corporation 
SEC. 331. DEPOSIT INSURANCE REFORMS. 
(a) SIZE DISTINCTIONS.—Section 7(b)(2) of the Fed-
eral Deposit Insurance Act (12 U.S.C. 1817(b)(2)) is 
amended— 
(1) by striking subparagraph (D); and 
(2) by redesignating subparagraph (C) as sub-
paragraph (D). 
(b) ASSESSMENT
BASE.—The Corporation shall 
amend the regulations issued by the Corporation under sec-
tion 7(b)(2) of the Federal Deposit Insurance Act (12 
U.S.C. 1817(b)(2)) to define the term ‘‘assessment base’’
361 
† HR 4173 EAS 
with respect to an insured depository institution for pur-
poses of that section 7(b)(2), as an amount equal to— 
(1) the average consolidated total assets of the in-
sured depository institution during the assessment pe-
riod; minus 
(2) the sum of— 
(A) the average tangible equity of the in-
sured depository institution during the assess-
ment period; and 
(B) in the case of an insured depository in-
stitution that is a custodial bank (as defined by 
the Corporation, based on factors including the 
percentage of total revenues generated by custo-
dial businesses and the level of assets under cus-
tody) or a banker’s bank (as that term is used 
in section 5136 of the Revised Statutes (12 
U.S.C. 24)), an amount that the Corporation de-
termines is necessary to establish assessments 
consistent with the definition under section 
7(b)(1) of the Federal Deposit Insurance Act (12 
U.S.C. 1817(b)(1)) for a custodial bank or a 
banker’s bank.
362 
† HR 4173 EAS 
SEC. 332. MANAGEMENT OF THE FEDERAL DEPOSIT INSUR-
ANCE CORPORATION. 
(a) IN GENERAL.—Section 2 of the Federal Deposit In-
surance Act (12 U.S.C. 1812) is amended— 
(1) in subsection (a)(1)(B), by striking ‘‘Director 
of the Office of Thrift Supervision’’ and inserting 
‘‘Director of the Consumer Financial Protection Bu-
reau’’; 
(2) by amending subsection (d)(2) to read as fol-
lows: 
‘‘(2) ACTING
OFFICIALS
MAY
SERVE.—In the 
event of a vacancy in the Office of the Comptroller of 
the Currency and pending the appointment of a suc-
cessor, or during the absence or disability of the 
Comptroller of the Currency, the acting Comptroller 
of the Currency shall be a member of the Board of Di-
rectors in the place of the Comptroller of the Cur-
rency.’’; and 
(3) in subsection (f)(2), by striking ‘‘or of the Of-
fice of Thrift Supervision’’. 
(b) EFFECTIVE DATE.—This section, and the amend-
ments made by this section, shall take effect on the transfer 
date.
363 
† HR 4173 EAS 
Subtitle D—Termination of Federal 
Thrift Charter 
SEC. 341. TERMINATION OF FEDERAL SAVINGS ASSOCIA-
TIONS. 
(a) IN GENERAL.—Beginning on the date of enactment 
of this Act, the Director of the Office of Thrift Supervision, 
or the Comptroller of the Currency, may not issue a charter 
for a Federal savings association under section 5 of the 
Home Owners’ Loan Act (12 U.S.C. 1464). 
(b) CONFORMING AMENDMENT.—Section 5(a) of the 
Home Owner’s Loan Act (12 U.S.C. 1464(a)) is amended 
to read as follows: 
‘‘(a) IN GENERAL.—In order to provide thrift institu-
tions for the deposit of funds and for the extension of credit 
for homes and other goods and services, the Comptroller of 
the Currency is authorized, under such regulations as the 
Comptroller of the Currency may prescribe, to provide for 
the examination, operation, and regulation of associations 
to be known as ‘Federal savings associations’ (including 
Federal savings banks), giving primary consideration to the 
best practices of thrift institutions in the United States. The 
lending and investment powers conferred by this section are 
intended to encourage such institutions to provide credit for 
housing safely and soundly.’’.
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† HR 4173 EAS 
(c) PROSPECTIVE REPEAL.—Effective on the date on 
which the Comptroller of the Currency determines that no 
Federal savings associations exist, section 5 of the Home 
Owner’s Loan Act (12 U.S.C. 1464) is repealed. 
SEC. 342. BRANCHING. 
Notwithstanding the Federal Deposit Insurance Act 
(12 U.S.C. 1811 et seq.), the Bank Holding Company Act 
of 1956 (12 U.S.C. 1841 et seq.), or any other provision 
of Federal or State law, a savings association that becomes 
a bank may continue to operate any branch or agency that 
the savings association operated immediately before the sav-
ings association became a bank. 
TITLE IV—REGULATION OF AD-
VISERS 
TO 
HEDGE 
FUNDS 
AND OTHERS 
SEC. 401. SHORT TITLE. 
This title may be cited as the ‘‘Private Fund Invest-
ment Advisers Registration Act of 2010’’. 
SEC. 402. DEFINITIONS. 
(a) INVESTMENT ADVISERS ACT
OF 1940 DEFINI-
TIONS.—Section 202(a) of the Investment Advisers Act of 
1940 (15 U.S.C. 80b–2(a)) is amended by adding at the 
end the following: 
‘‘(29) The term ‘private fund’ means an issuer 
that would be an investment company, as defined in
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section 3 of the Investment Company Act of 1940 (15 
U.S.C. 80a–3), but for section 3(c)(1) or 3(c)(7) of 
that Act. 
‘‘(30) The term ‘foreign private adviser’ means 
any investment adviser who— 
‘‘(A) has no place of business in the United 
States; 
‘‘(B) has, in total, fewer than 15 clients who 
are domiciled in or residents of the United 
States; 
‘‘(C) has aggregate assets under manage-
ment attributable to clients in the United States 
and investors in the United States in private 
funds advised by the investment adviser of less 
than $25,000,000, or such higher amount as the 
Commission may, by rule, deem appropriate in 
accordance with the purposes of this title; and 
‘‘(D) neither— 
‘‘(i) holds itself out generally to the 
public in the United States as an invest-
ment adviser; nor 
‘‘(ii) acts as— 
‘‘(I) an investment adviser to any 
investment company registered under
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the Investment Company Act of 1940; 
or 
‘‘(II) a company that has elected 
to be a business development company 
pursuant to section 54 of the Invest-
ment Company Act of 1940 (15 U.S.C. 
80a–53), and has not withdrawn its 
election.’’. 
(b) OTHER DEFINITIONS.—As used in this title, the 
terms ‘‘investment adviser’’ and ‘‘private fund’’ have the 
same meanings as in section 202 of the Investment Advisers 
Act of 1940, as amended by this title. 
SEC. 403. ELIMINATION OF PRIVATE ADVISER EXEMPTION; 
LIMITED EXEMPTION FOR FOREIGN PRIVATE 
ADVISERS; LIMITED INTRASTATE EXEMPTION. 
Section 203(b) of the Investment Advisers Act of 1940 
(15 U.S.C. 80b–3(b)) is amended— 
(1) in paragraph (1), by inserting ‘‘, other than 
an investment adviser who acts as an investment ad-
viser to any private fund,’’ before ‘‘all of whose’’; 
(2) by striking paragraph (3) and inserting the 
following: 
‘‘(3) any investment adviser that is a foreign 
private adviser;’’; and
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(3) in paragraph (5), by striking ‘‘or’’ at the 
end; 
(4) in paragraph (6), by striking the period at 
the end and inserting ‘‘; or’’; and 
(5) by adding at the end the following: 
‘‘(7) any investment adviser, other than any en-
tity that has elected to be regulated or is regulated as 
a business development company pursuant to section 
54 of the Investment Company Act of 1940 (15 U.S.C. 
80a–54), who solely advises— 
‘‘(A) small business investment companies 
that are licensees under the Small Business In-
vestment Act of 1958; 
‘‘(B) entities that have received from the 
Small Business Administration notice to proceed 
to qualify for a license as a small business in-
vestment company under the Small Business In-
vestment Act of 1958, which notice or license has 
not been revoked; or 
‘‘(C) applicants that are affiliated with 1 or 
more licensed small business investment compa-
nies described in subparagraph (A) and that 
have applied for another license under the Small 
Business Investment Act of 1958, which applica-
tion remains pending.’’.
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SEC. 404. COLLECTION OF SYSTEMIC RISK DATA; REPORTS; 
EXAMINATIONS; DISCLOSURES. 
Section 204 of the Investment Advisers Act of 1940 (15 
U.S.C. 80b–4) is amended— 
(1) by redesignating subsections (b) and (c) as 
subsections (c) and (d), respectively; and 
(2) by inserting after subsection (a) the fol-
lowing: 
‘‘(b) RECORDS AND REPORTS OF PRIVATE FUNDS.— 
‘‘(1) IN
GENERAL.—The Commission may re-
quire any investment adviser registered under this 
title— 
‘‘(A) to maintain such records of, and file 
with the Commission such reports regarding, 
private funds advised by the investment adviser, 
as necessary and appropriate in the public inter-
est and for the protection of investors, or for the 
assessment of systemic risk by the Financial Sta-
bility Oversight Council (in this subsection re-
ferred to as the ‘Council’); and 
‘‘(B) to provide or make available to the 
Council those reports or records or the informa-
tion contained therein. 
‘‘(2) TREATMENT OF RECORDS.—The records and 
reports of any private fund to which an investment 
adviser registered under this title provides investment
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advice shall be deemed to be the records and reports 
of the investment adviser. 
‘‘(3) REQUIRED INFORMATION.—The records and 
reports required to be maintained by a private fund 
and subject to inspection by the Commission under 
this subsection shall include, for each private fund ad-
vised by the investment adviser, a description of— 
‘‘(A) the amount of assets under manage-
ment and use of leverage; 
‘‘(B) counterparty credit risk exposure; 
‘‘(C) trading and investment positions; 
‘‘(D) valuation policies and practices of the 
fund; 
‘‘(E) types of assets held; 
‘‘(F) side arrangements or side letters, 
whereby certain investors in a fund obtain more 
favorable rights or entitlements than other inves-
tors; 
‘‘(G) trading practices; and 
‘‘(H) such other information as the Com-
mission, in consultation with the Council, deter-
mines is necessary and appropriate in the public 
interest and for the protection of investors or for 
the assessment of systemic risk, which may in-
clude the establishment of different reporting re-
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quirements for different classes of fund advisers, 
based on the type or size of private fund being 
advised. 
‘‘(4) MAINTENANCE
OF
RECORDS.—An invest-
ment adviser registered under this title shall main-
tain such records of private funds advised by the in-
vestment adviser for such period or periods as the 
Commission, by rule, may prescribe as necessary and 
appropriate in the public interest and for the protec-
tion of investors, or for the assessment of systemic 
risk. 
‘‘(5) FILING
OF
RECORDS.—The Commission 
shall issue rules requiring each investment adviser to 
a private fund to file reports containing such infor-
mation as the Commission deems necessary and ap-
propriate in the public interest and for the protection 
of investors or for the assessment of systemic risk. 
‘‘(6) EXAMINATION OF RECORDS.— 
‘‘(A) PERIODIC
AND
SPECIAL
EXAMINA-
TIONS.—The Commission— 
‘‘(i) shall conduct periodic inspections 
of all records of private funds maintained 
by an investment adviser registered under 
this title in accordance with a schedule es-
tablished by the Commission; and
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‘‘(ii) may conduct at any time and 
from time to time such additional, special, 
and other examinations as the Commission 
may prescribe as necessary and appropriate 
in the public interest and for the protection 
of investors, or for the assessment of sys-
temic risk. 
‘‘(B) AVAILABILITY OF RECORDS.—An in-
vestment adviser registered under this title shall 
make available to the Commission any copies or 
extracts from such records as may be prepared 
without undue effort, expense, or delay, as the 
Commission or its representatives may reason-
ably request. 
‘‘(7) INFORMATION SHARING.— 
‘‘(A) IN GENERAL.—The Commission shall 
make available to the Council copies of all re-
ports, documents, records, and information filed 
with or provided to the Commission by an in-
vestment adviser under this subsection as the 
Council may consider necessary for the purpose 
of assessing the systemic risk posed by a private 
fund. 
‘‘(B) CONFIDENTIALITY.—The Council shall 
maintain the confidentiality of information re-
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† HR 4173 EAS 
ceived under this paragraph in all such reports, 
documents, records, and information, in a man-
ner consistent with the level of confidentiality es-
tablished by the Commission pursuant to para-
graph (8). The Council shall be exempt from sec-
tion 552 of title 5, United States Code, with re-
spect to any information in any report, docu-
ment, record, or information made available, to 
the Council under this subsection.’’. 
‘‘(8) COMMISSION
CONFIDENTIALITY
OF
RE-
PORTS.—Notwithstanding any other provision of law, 
the Commission may not be compelled to disclose any 
report or information contained therein required to be 
filed with the Commission under this subsection, ex-
cept that nothing in this subsection authorizes the 
Commission— 
‘‘(A) to withhold information from Con-
gress, upon an agreement of confidentiality; or 
‘‘(B) prevent the Commission from com-
plying with— 
‘‘(i) a request for information from 
any other Federal department or agency or 
any self-regulatory organization requesting 
the report or information for purposes with-
in the scope of its jurisdiction; or
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† HR 4173 EAS 
‘‘(ii) an order of a court of the United 
States in an action brought by the United 
States or the Commission. 
‘‘(9) OTHER
RECIPIENTS
CONFIDENTIALITY.— 
Any department, agency, or self-regulatory organiza-
tion that receives reports or information from the 
Commission under this subsection shall maintain the 
confidentiality of such reports, documents, records, 
and information in a manner consistent with the 
level of confidentiality established for the Commission 
under paragraph (8). 
‘‘(10) PUBLIC INFORMATION EXCEPTION.— 
‘‘(A) IN
GENERAL.—The Commission, the 
Council, and any other department, agency, or 
self-regulatory organization that receives infor-
mation, reports, documents, records, or informa-
tion from the Commission under this subsection, 
shall be exempt from the provisions of section 
552 of title 5, United States Code, with respect 
to any such report, document, record, or infor-
mation. Any proprietary information of an in-
vestment adviser ascertained by the Commission 
from any report required to be filed with the 
Commission pursuant to this subsection shall be 
subject to the same limitations on public disclo-
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† HR 4173 EAS 
sure as any facts ascertained during an exam-
ination, as provided by section 210(b) of this 
title. 
‘‘(B) 
PROPRIETARY
INFORMATION.—For 
purposes of this paragraph, proprietary informa-
tion includes— 
‘‘(i) sensitive, non-public information 
regarding the investment or trading strate-
gies of the investment adviser; 
‘‘(ii) analytical or research methodolo-
gies; 
‘‘(iii) trading data; 
‘‘(iv) computer hardware or software 
containing intellectual property; and 
‘‘(v) any additional information that 
the Commission determines to be propri-
etary. 
‘‘(11) ANNUAL
REPORT
TO
CONGRESS.—The 
Commission shall report annually to Congress on how 
the Commission has used the data collected pursuant 
to this subsection to monitor the markets for the pro-
tection of investors and the integrity of the markets.’’. 
SEC. 405. DISCLOSURE PROVISION ELIMINATED. 
Section 210(c) of the Investment Advisers Act of 1940 
(15 U.S.C. 80b–10(c)) is amended by inserting before the
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† HR 4173 EAS 
period at the end the following: ‘‘or for purposes of assess-
ment of potential systemic risk’’. 
SEC. 406. CLARIFICATION OF RULEMAKING AUTHORITY. 
Section 211 of the Investment Advisers Act of 1940 (15 
U.S.C. 80b–11) is amended— 
(1) in subsection (a), by inserting before the pe-
riod at the end of the first sentence the following: ‘‘, 
including rules and regulations defining technical, 
trade, and other terms used in this title, except that 
the Commission may not define the term ‘client’ for 
purposes of paragraphs (1) and (2) of section 206 to 
include an investor in a private fund managed by an 
investment adviser, if such private fund has entered 
into an advisory contract with such adviser’’; and 
(2) by adding at the end the following: 
‘‘(e) DISCLOSURE RULES ON PRIVATE FUNDS.—The 
Commission and the Commodity Futures Trading Commis-
sion shall, after consultation with the Council but not later 
than 12 months after the date of enactment of the Private 
Fund Investment Advisers Registration Act of 2010, jointly 
promulgate rules to establish the form and content of the 
reports required to be filed with the Commission under sub-
section 204(b) and with the Commodity Futures Trading 
Commission by investment advisers that are registered both
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† HR 4173 EAS 
under this title and the Commodity Exchange Act (7 U.S.C. 
1a et seq.).’’. 
SEC. 407. EXEMPTION OF VENTURE CAPITAL FUND ADVIS-
ERS. 
Section 203 of the Investment Advisers Act of 1940 (15 
U.S.C. 80b–3) is amended by adding at the end the fol-
lowing: 
‘‘(l) EXEMPTION OF VENTURE CAPITAL FUND ADVIS-
ERS.—No investment adviser shall be subject to the registra-
tion requirements of this title with respect to the provision 
of investment advice relating to a venture capital fund. Not 
later than 6 months after the date of enactment of this sub-
section, the Commission shall issue final rules to define the 
term ‘venture capital fund’ for purposes of this subsection.’’. 
SEC. 408. EXEMPTION OF AND RECORD KEEPING BY PRI-
VATE EQUITY FUND ADVISERS. 
Section 203 of the Investment Advisers Act of 1940 (15 
U.S.C. 80b–3) is amended by adding at the end the fol-
lowing: 
‘‘(m) EXEMPTION OF AND REPORTING BY PRIVATE EQ-
UITY FUND ADVISERS.— 
‘‘(1) IN GENERAL.—Except as provided in this 
subsection, no investment adviser shall be subject to 
the registration or reporting requirements of this title
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† HR 4173 EAS 
with respect to the provision of investment advice re-
lating to a private equity fund or funds. 
‘‘(2) MAINTENANCE OF RECORDS AND ACCESS BY 
COMMISSION.—Not later than 6 months after the date 
of enactment of this subsection, the Commission shall 
issue final rules— 
‘‘(A) to require investment advisers de-
scribed in paragraph (1) to maintain such 
records and provide to the Commission such an-
nual or other reports as the Commission taking 
into account fund size, governance, investment 
strategy, risk, and other factors, as the Commis-
sion determines necessary and appropriate in the 
public interest and for the protection of inves-
tors; and 
‘‘(B) to define the term ‘private equity fund’ 
for purposes of this subsection.’’. 
SEC. 409. FAMILY OFFICES. 
(a) IN GENERAL.—Section 202(a)(11) of the Invest-
ment Advisers Act of 1940 (15 U.S.C. 80b–2(a)(11)) is 
amended by striking ‘‘or (G)’’ and inserting the following: 
‘‘; (G) any family office, as defined by rule, regulation, or 
order of the Commission, in accordance with the purposes 
of this title; or (H)’’.
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(b) RULEMAKING.—The rules, regulations, or orders 
issued 
by 
the 
Commission 
pursuant 
to 
section 
202(a)(11)(G) of the Investment Advisers Act of 1940, as 
added by this section, regarding the definition of the term 
‘‘family office’’ shall provide for an exemption that— 
(1) is consistent with the previous exemptive pol-
icy of the Commission, as reflected in exemptive or-
ders for family offices in effect on the date of enact-
ment of this Act; and 
(2) recognizes the range of organizational, man-
agement, and employment structures and arrange-
ments employed by family offices. 
SEC. 410. STATE AND FEDERAL RESPONSIBILITIES; ASSET 
THRESHOLD FOR FEDERAL REGISTRATION 
OF INVESTMENT ADVISERS. 
Section 203A(a)(1) of the Investment Advisers Act of 
1940 (15 U.S.C. 80b–3a(a)(1)) is amended— 
(1) in subparagraph (A)— 
(A) by striking ‘‘$25,000,000’’ and inserting 
‘‘$100,000,000’’; and 
(B) by striking ‘‘or’’ at the end; 
(2) in subparagraph (B), by striking the period 
at the end and inserting ‘‘; or’’; and 
(3) by adding at the end the following:
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† HR 4173 EAS 
‘‘(C) is an adviser to a company that has 
elected to be a business development company 
pursuant to section 54 of the Investment Com-
pany Act of 1940, and has not withdrawn its 
election.’’. 
SEC. 411. CUSTODY OF CLIENT ASSETS. 
The Investment Advisers Act of 1940 (15 U.S.C. 80b– 
1 et seq.) is amended by adding at the end the following 
new section: 
‘‘SEC. 223. CUSTODY OF CLIENT ACCOUNTS. 
‘‘An investment adviser registered under this title shall 
take such steps to safeguard client assets over which such 
adviser has custody, including, without limitation, 
verification of such assets by an independent public ac-
countant, as the Commission may, by rule, prescribe.’’. 
SEC. 412. ADJUSTING THE ACCREDITED INVESTOR STAND-
ARD. 
(a) IN GENERAL.—The Commission shall adjust any 
net worth standard for an accredited investor, as set forth 
in the rules of the Commission under the Securities Act of 
1933, so that the individual net worth of any natural per-
son, or joint net worth with the spouse of that person, at 
the time of purchase, is more than $1,000,000 (as such 
amount is adjusted periodically by rule of the Commission), 
excluding the value of the primary residence of such natural
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† HR 4173 EAS 
person, except that during the 4-year period that begins on 
the date of enactment of this Act, any net worth standard 
shall be $1,000,000, excluding the value of the primary resi-
dence of such natural person. 
(b) REVIEW AND ADJUSTMENT.— 
(1) INITIAL REVIEW AND ADJUSTMENT.— 
(A) INITIAL
REVIEW.—The Commission 
may undertake a review of the definition of the 
term ‘‘accredited investor’’, as such term applies 
to natural persons, to determine whether the re-
quirements of the definition, excluding the re-
quirement relating to the net worth standard de-
scribed in subsection (a), should be adjusted or 
modified for the protection of investors, in the 
public interest, and in light of the economy. 
(B) ADJUSTMENT OR MODIFICATION.—Upon 
completion of a review under subparagraph (A), 
the Commission may, by notice and comment 
rulemaking, make such adjustments to the defini-
tion of the term ‘‘accredited investor’’, excluding 
adjusting or modifying the requirement relating 
to the net worth standard described in subsection 
(a), as such term applies to natural persons, as 
the Commission may deem appropriate for the
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† HR 4173 EAS 
protection of investors, in the public interest, 
and in light of the economy. 
(2) SUBSEQUENT REVIEWS AND ADJUSTMENT.— 
(A) SUBSEQUENT
REVIEWS.—Not earlier 
than 4 years after the date of enactment of this 
Act, and not less frequently than once every 4 
years thereafter, the Commission shall undertake 
a review of the definition, in its entirety, of the 
term ‘‘accredited investor’’, as defined in section 
230.215 of title 17, Code of Federal Regulations, 
or any successor thereto, as such term applies to 
natural persons, to determine whether the re-
quirements of the definition should be adjusted or 
modified for the protection of investors, in the 
public interest, and in light of the economy. 
(B) ADJUSTMENT OR MODIFICATION.—Upon 
completion of a review under subparagraph (A), 
the Commission may, by notice and comment 
rulemaking, make such adjustments to the defini-
tion of the term ‘‘accredited investor’’, as defined 
in section 230.215 of title 17, Code of Federal 
Regulations, or any successor thereto, as such 
term applies to natural persons, as the Commis-
sion may deem appropriate for the protection of
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† HR 4173 EAS 
investors, in the public interest, and in light of 
the economy. 
SEC. 413. GAO STUDY AND REPORT ON ACCREDITED INVES-
TORS. 
The Comptroller General of the United States shall 
conduct a study on the appropriate criteria for determining 
the financial thresholds or other criteria needed to qualify 
for accredited investor status and eligibility to invest in 
private funds, and shall submit a report to the Committee 
on Banking, Housing, and Urban Affairs of the Senate and 
the Committee on Financial Services of the House of Rep-
resentatives on the results of such study not later than 3 
years after the date of enactment of this Act. 
SEC. 414. GAO STUDY ON SELF-REGULATORY ORGANIZA-
TION FOR PRIVATE FUNDS. 
The Comptroller General of the United States shall— 
(1) conduct a study of the feasibility of forming 
a self-regulatory organization to oversee private 
funds; and 
(2) submit a report to the Committee on Bank-
ing, Housing, and Urban Affairs of the Senate and 
the Committee on Financial Services of the House of 
Representatives on the results of such study, not later 
than 1 year after the date of enactment of this Act.
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† HR 4173 EAS 
SEC. 415. COMMISSION STUDY AND REPORT ON SHORT 
SELLING. 
(a) STUDY.—The Division of Risk, Strategy, and Fi-
nancial Innovation of the Commission shall conduct a 
study, taking into account current scholarship, on the state 
of short selling on national securities exchanges and in the 
over-the-counter markets, with particular attention to the 
impact of recent rule changes and the incidence of— 
(1) the failure to deliver shares sold short; or 
(2) delivery of shares on the fourth day following 
the short sale transaction. 
(b) REPORT.—The Division of Risk, Strategy, and Fi-
nancial Innovation shall submit a report, together with any 
recommendations for market improvements, including con-
sideration of real time reporting of short sale positions, to 
the Committee on Banking, Housing, and Urban Affairs 
of the Senate and the Committee on Financial Services of 
the House of Representatives on the results of the study con-
ducted under subsection (a), not later than 2 years after 
the date of enactment of this Act. 
SEC. 416. TRANSITION PERIOD. 
Except as otherwise provided in this title, this title and 
the amendments made by this title shall become effective 
1 year after the date of enactment of this Act, except that 
any investment adviser may, at the discretion of the invest-
ment adviser, register with the Commission under the In-
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vestment Advisers Act of 1940 during that 1-year period, 
subject to the rules of the Commission. 
TITLE V—INSURANCE 
Subtitle A—Office of National 
Insurance 
SEC. 501. SHORT TITLE. 
This subtitle may be cited as the ‘‘Office of National 
Insurance Act of 2010’’. 
SEC. 502. ESTABLISHMENT OF OFFICE OF NATIONAL INSUR-
ANCE. 
(a) ESTABLISHMENT OF OFFICE.—Subchapter I of 
chapter 3 of subtitle I of title 31, United States Code, is 
amended— 
(1) by redesignating section 312 as section 315; 
(2) by redesignating section 313 as section 312; 
and 
(3) by inserting after section 312 (as so redesig-
nated) the following new sections: 
‘‘SEC. 313. OFFICE OF NATIONAL INSURANCE. 
‘‘(a) ESTABLISHMENT.—There is established within 
the Department of the Treasury the Office of National In-
surance. 
‘‘(b) LEADERSHIP.—The Office shall be headed by a 
Director, who shall be appointed by the Secretary of the 
Treasury. The position of Director shall be a career reserved
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position in the Senior Executive Service, as that position 
is defined under section 3132 of title 5, United States Code. 
‘‘(c) FUNCTIONS.— 
‘‘(1) AUTHORITY PURSUANT TO DIRECTION OF 
SECRETARY.—The Office, pursuant to the direction of 
the Secretary, shall have the authority— 
‘‘(A) to monitor all aspects of the insurance 
industry, including identifying issues or gaps in 
the regulation of insurers that could contribute 
to a systemic crisis in the insurance industry or 
the United States financial system; 
‘‘(B) to recommend to the Financial Sta-
bility Oversight Council that it designate an in-
surer, including the affiliates of such insurer, as 
an entity subject to regulation as a nonbank fi-
nancial company supervised by the Board of 
Governors pursuant to title I of the Restoring 
American Financial Stability Act of 2010; 
‘‘(C) to assist the Secretary in admin-
istering the Terrorism Insurance Program estab-
lished in the Department of the Treasury under 
the Terrorism Risk Insurance Act of 2002 (15 
U.S.C. 6701 note); 
‘‘(D) to coordinate Federal efforts and de-
velop Federal policy on prudential aspects of
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† HR 4173 EAS 
international insurance matters, including rep-
resenting the United States, as appropriate, in 
the International Association of Insurance Su-
pervisors (or a successor entity) and assisting the 
Secretary in negotiating International Insurance 
Agreements on Prudential Measures; 
‘‘(E) to determine, in accordance with sub-
section (f), whether State insurance measures are 
preempted by International Insurance Agree-
ments on Prudential Measures; 
‘‘(F) to consult with the States (including 
State insurance regulators) regarding insurance 
matters of national importance and prudential 
insurance matters of international importance; 
and 
‘‘(G) to perform such other related duties 
and authorities as may be assigned to the Office 
by the Secretary. 
‘‘(2) ADVISORY FUNCTIONS.—The Office shall ad-
vise the Secretary on major domestic and prudential 
international insurance policy issues. 
‘‘(d) SCOPE.—The authority of the Office shall extend 
to all lines of insurance except health insurance, as such 
insurance is determined by the Secretary based on section 
2791 of the Public Health Service Act (42 U.S.C. 300gg–
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† HR 4173 EAS 
91), and crop insurance, as established by the Federal Crop 
Insurance Act (7 U.S.C. 1501 et seq.). 
‘‘(e) GATHERING OF INFORMATION.— 
‘‘(1) IN GENERAL.—In carrying out the func-
tions required under subsection (c), the Office may— 
‘‘(A) receive and collect data and informa-
tion on and from the insurance industry and in-
surers; 
‘‘(B) enter into information-sharing agree-
ments; 
‘‘(C) analyze and disseminate data and in-
formation; and 
‘‘(D) issue reports regarding all lines of in-
surance except health insurance. 
‘‘(2) COLLECTION OF INFORMATION FROM INSUR-
ERS AND AFFILIATES.— 
‘‘(A) IN GENERAL.—Except as provided in 
paragraph (3), the Office may require an in-
surer, or any affiliate of an insurer, to submit 
such data or information as the Office may rea-
sonably require in carrying out the functions de-
scribed under subsection (c). 
‘‘(B) RULE
OF
CONSTRUCTION.—Notwith-
standing any other provision of this section, for 
purposes of subparagraph (A), the term ‘insurer’
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means any person that is authorized to write in-
surance or reinsure risks and issue contracts or 
policies in 1 or more States. 
‘‘(3) EXCEPTION FOR SMALL INSURERS.—Para-
graph (2) shall not apply with respect to any insurer 
or affiliate thereof that meets a minimum size thresh-
old that the Office may establish, whether by order or 
rule. 
‘‘(4) ADVANCE COORDINATION.—Before collecting 
any data or information under paragraph (2) from 
an insurer, or any affiliate of an insurer, the Office 
shall coordinate with each relevant State insurance 
regulator (or other relevant Federal or State regu-
latory agency, if any, in the case of an affiliate of an 
insurer) to determine if the information to be collected 
is available from, or may be obtained in a timely 
manner by, such State insurance regulator, individ-
ually or collectively, another regulatory agency, or 
publicly available sources. Notwithstanding any other 
provision of law, each such relevant State insurance 
regulator or other Federal or State regulatory agency 
is authorized to provide to the Office such data or in-
formation. 
‘‘(5) CONFIDENTIALITY.—
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‘‘(A) RETENTION OF PRIVILEGE.—The sub-
mission of any nonpublicly available data and 
information to the Office under this subsection 
shall not constitute a waiver of, or otherwise af-
fect, any privilege arising under Federal or State 
law (including the rules of any Federal or State 
court) to which the data or information is other-
wise subject. 
‘‘(B) CONTINUED
APPLICATION
OF
PRIOR 
CONFIDENTIALITY
AGREEMENTS.—Any require-
ment under Federal or State law to the extent 
otherwise applicable, or any requirement pursu-
ant to a written agreement in effect between the 
original source of any nonpublicly available 
data or information and the source of such data 
or information to the Office, regarding the pri-
vacy or confidentiality of any data or informa-
tion in the possession of the source to the Office, 
shall continue to apply to such data or informa-
tion after the data or information has been pro-
vided pursuant to this subsection to the Office. 
‘‘(C) INFORMATION SHARING AGREEMENT.— 
Any data or information obtained by the Office 
may be made available to State insurance regu-
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lators, individually or collectively, through an 
information sharing agreement that— 
‘‘(i) shall comply with applicable Fed-
eral law; and 
‘‘(ii) shall not constitute a waiver of, 
or otherwise affect, any privilege under Fed-
eral or State law (including the rules of any 
Federal or State Court) to which the data 
or information is otherwise subject. 
‘‘(D) 
AGENCY
DISCLOSURE
REQUIRE-
MENTS.—Section 552 of title 5, United States 
Code, shall apply to any data or information 
submitted to the Office by an insurer or an affil-
iate of an insurer. 
‘‘(6) SUBPOENAS AND ENFORCEMENT.—The Di-
rector shall have the power to require by subpoena the 
production of the data or information requested under 
paragraph (2), but only upon a written finding by 
the Director that such data or information is required 
to carry out the functions described under subsection 
(c) and that the Office has coordinated with such reg-
ulator or agency as required under paragraph (4). 
Subpoenas shall bear the signature of the Director 
and shall be served by any person or class of persons 
designated by the Director for that purpose. In the
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† HR 4173 EAS 
case of contumacy or failure to obey a subpoena, the 
subpoena shall be enforceable by order of any appro-
priate district court of the United States. Any failure 
to obey the order of the court may be punished by the 
court as a contempt of court. 
‘‘(f) PREEMPTION
OF
STATE
INSURANCE
MEAS-
URES.— 
‘‘(1) STANDARD.—A State insurance measure 
shall be preempted if, and only to the extent that the 
Director determines, in accordance with this sub-
section, that the measure— 
‘‘(A) results in less favorable treatment of a 
non-United States insurer domiciled in a foreign 
jurisdiction that is subject to an international 
insurance agreement on prudential measures 
than a United States insurer domiciled, licensed, 
or otherwise admitted in that State; and 
‘‘(B) is inconsistent with an International 
Insurance Agreement on Prudential Measures. 
‘‘(2) DETERMINATION.— 
‘‘(A) NOTICE
OF
POTENTIAL
INCONSIST-
ENCY.—Before making any determination under 
paragraph (1), the Director shall—
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‘‘(i) notify and consult with the appro-
priate State regarding any potential incon-
sistency or preemption; 
‘‘(ii) cause to be published in the Fed-
eral Register notice of the issue regarding 
the potential inconsistency or preemption, 
including a description of each State insur-
ance measure at issue and any applicable 
International Insurance Agreement on Pru-
dential Measures; 
‘‘(iii) provide interested parties a rea-
sonable opportunity to submit written com-
ments to the Office; and 
‘‘(iv) consider any comments received. 
‘‘(B) SCOPE OF REVIEW.—For purposes of 
this subsection, the determination of the Director 
regarding State insurance measures shall be lim-
ited to the subject matter contained within the 
international insurance agreement on prudential 
measure involved. 
‘‘(C) NOTICE OF DETERMINATION OF INCON-
SISTENCY.—Upon making any determination 
under paragraph (1), the Director shall—
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‘‘(i) notify the appropriate State of the 
determination and the extent of the incon-
sistency; 
‘‘(ii) establish a reasonable period of 
time, which shall not be less than 30 days, 
before the determination shall become effec-
tive; and 
‘‘(iii) notify the Committee on Bank-
ing, Housing, and Urban Affairs of the 
Senate and the Committee on Financial 
Services of the House of Representatives of 
the inconsistency. 
‘‘(3) NOTICE
OF
EFFECTIVENESS.—Upon the 
conclusion of the period referred to in paragraph 
(2)(C)(ii), if the basis for such determination still ex-
ists, the determination shall become effective and the 
Director shall— 
‘‘(A) cause to be published a notice in the 
Federal Register that the preemption has become 
effective, as well as the effective date; and 
‘‘(B) notify the appropriate State. 
‘‘(4) LIMITATION.—No State may enforce a State 
insurance measure to the extent that such measure 
has been preempted under this subsection.
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‘‘(g) APPLICABILITY
OF
ADMINISTRATIVE
PROCE-
DURES ACT.—Determinations of inconsistency made pursu-
ant to subsection (f)(2) shall be subject to the applicable 
provisions of subchapter II of chapter 5 of title 5, United 
States Code (relating to administrative procedure), and 
chapter 7 of such title (relating to judicial review). 
‘‘(h) REGULATIONS, POLICIES, AND PROCEDURES.— 
The Secretary may issue orders, regulations, policies, and 
procedures to implement this section. 
‘‘(i) CONSULTATION.—The Director shall consult with 
State insurance regulators, individually or collectively, to 
the extent the Director determines appropriate, in carrying 
out the functions of the Office. 
‘‘(j) SAVINGS PROVISIONS.—Nothing in this section 
shall— 
‘‘(1) preempt— 
‘‘(A) any State insurance measure that gov-
erns any insurer’s rates, premiums, under-
writing, or sales practices; 
‘‘(B) any State coverage requirements for 
insurance; 
‘‘(C) the application of the antitrust laws of 
any State to the business of insurance; or 
‘‘(D) any State insurance measure gov-
erning the capital or solvency of an insurer, ex-
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† HR 4173 EAS 
cept to the extent that such State insurance 
measure results in less favorable treatment of a 
non-United State insurer than a United States 
insurer; 
‘‘(2) be construed to alter, amend, or limit any 
provision of the Consumer Financial Protection Agen-
cy Act of 2010; or 
‘‘(3) affect the preemption of any State insur-
ance measure otherwise inconsistent with and pre-
empted by Federal law. 
‘‘(k) RETENTION OF EXISTING STATE REGULATORY 
AUTHORITY.—Nothing in this section or section 314 shall 
be construed to establish or provide the Office or the Depart-
ment of the Treasury with general supervisory or regulatory 
authority over the business of insurance. 
‘‘(l) ANNUAL REPORT TO CONGRESS.—Beginning Sep-
tember 30, 2011, the Director shall submit a report on or 
before September 30 of each calendar year to the President 
and to the Committee on Banking, Housing, and Urban 
Affairs of the Senate and the Committee on Financial Serv-
ices of the House of Representatives on the insurance indus-
try, any actions taken by the Office pursuant to subsection 
(f) (regarding preemption of inconsistent State insurance 
measures), and any other information as deemed relevant 
by the Director or as requested by such Committees.
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‘‘(m) STUDY AND REPORT ON REGULATION OF INSUR-
ANCE.— 
‘‘(1) IN GENERAL.—Not later than 18 months 
after the date of enactment of this section, the Direc-
tor shall conduct a study and submit a report to Con-
gress on how to modernize and improve the system of 
insurance regulation in the United States. 
‘‘(2) CONSIDERATIONS.—The study and report 
required under paragraph (1) shall be based on and 
guided by the following considerations: 
‘‘(A) Systemic risk regulation with respect 
to insurance. 
‘‘(B) Capital standards and the relationship 
between capital allocation and liabilities, includ-
ing standards relating to liquidity and duration 
risk. 
‘‘(C) Consumer protection for insurance 
products and practices, including gaps in state 
regulation. 
‘‘(D) The degree of national uniformity of 
state insurance regulation. 
‘‘(E) The regulation of insurance companies 
and affiliates on a consolidated basis. 
‘‘(F) International coordination of insur-
ance regulation.
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‘‘(3) ADDITIONAL FACTORS.—The study and re-
port required under paragraph (1) shall also examine 
the following factors: 
‘‘(A) The costs and benefits of potential Fed-
eral regulation of insurance across various lines 
of insurance (except health insurance). 
‘‘(B) The feasibility of regulating only cer-
tain lines of insurance at the Federal level, while 
leaving other lines of insurance to be regulated 
at the State level. 
‘‘(C) The ability of any potential Federal 
regulation or Federal regulators to eliminate or 
minimize regulatory arbitrage. 
‘‘(D) The impact that developments in the 
regulation of insurance in foreign jurisdictions 
might have on the potential Federal regulation of 
insurance. 
‘‘(E) The ability of any potential Federal 
regulation or Federal regulator to provide robust 
consumer protection for policyholders. 
‘‘(F) The potential consequences of sub-
jecting insurance companies to a Federal resolu-
tion authority, including the effects of any Fed-
eral resolution authority—
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‘‘(i) on the operation of State insur-
ance guaranty fund systems, including the 
loss of guaranty fund coverage if an insur-
ance company is subject to a Federal resolu-
tion authority; 
‘‘(ii) on policyholder protection, in-
cluding the loss of the priority status of pol-
icyholder claims over other unsecured gen-
eral creditor claims; 
‘‘(iii) in the case of life insurance com-
panies, the loss of the special status of sepa-
rate account assets and separate account li-
abilities; and 
‘‘(iv) on the international competitive-
ness of insurance companies. 
‘‘(G) Such other factors as the Director de-
termines necessary or appropriate, consistent 
with the principles set forth in paragraph (2). 
‘‘(4) REQUIRED RECOMMENDATIONS.—The study 
and report required under paragraph (1) shall also 
contain any legislative, administrative, or regulatory 
recommendations, as the Director determines appro-
priate, to carry out or effectuate the findings set forth 
in such report.
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‘‘(5) CONSULTATION.—With respect to the study 
and report required under paragraph (1), the Direc-
tor shall consult with the National Association of In-
surance Commissioners, consumer organizations, rep-
resentatives of the insurance industry and policy-
holders, and other organizations and experts, as ap-
propriate. 
‘‘(n) USE OF EXISTING RESOURCES.—To carry out 
this section, the Office may employ personnel, facilities, and 
any other resource of the Department of the Treasury avail-
able to the Secretary. 
‘‘(o) DEFINITIONS.—In this section and section 314, 
the following definitions shall apply: 
‘‘(1) AFFILIATE.—The term ‘affiliate’ means, 
with respect to an insurer, any person who controls, 
is controlled by, or is under common control with the 
insurer. 
‘‘(2) INSURER.—The term ‘insurer’ means any 
person engaged in the business of insurance, includ-
ing reinsurance. 
‘‘(3) INTERNATIONAL INSURANCE AGREEMENT ON 
PRUDENTIAL
MEASURES.—The term ‘International 
Insurance Agreement on Prudential Measures’ means 
a written bilateral or multilateral agreement entered 
into between the United States and a foreign govern-
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† HR 4173 EAS 
ment, authority, or regulatory entity regarding pru-
dential measures applicable to the business of insur-
ance or reinsurance. 
‘‘(4) NON-UNITED STATES INSURER.—The term 
‘non-United States insurer’ means an insurer that is 
organized under the laws of a jurisdiction other than 
a State, but does not include any United States 
branch of such an insurer. 
‘‘(5) OFFICE.—The term ‘Office’ means the Office 
of National Insurance established by this section. 
‘‘(6) STATE
INSURANCE
MEASURE.—The term 
‘State insurance measure’ means any State law, regu-
lation, administrative ruling, bulletin, guideline, or 
practice relating to or affecting prudential measures 
applicable to insurance or reinsurance. 
‘‘(7) STATE INSURANCE REGULATOR.—The term 
‘State insurance regulator’ means any State regu-
latory authority responsible for the supervision of in-
surers. 
‘‘(8) UNITED
STATES
INSURER.—The term 
‘United States insurer’ means— 
‘‘(A) an insurer that is organized under the 
laws of a State; or 
‘‘(B) a United States branch of a non- 
United States insurer.
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‘‘(p) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated for the Office for each 
fiscal year such sums as may be necessary. 
‘‘SEC. 314. INTERNATIONAL INSURANCE AGREEMENTS ON 
PRUDENTIAL MEASURES. 
‘‘(a) IN GENERAL.—The Secretary of the Treasury is 
authorized to negotiate and enter into International Insur-
ance Agreements on Prudential Measures on behalf of the 
United States. 
‘‘(b) SAVINGS PROVISION.—Nothing in this section or 
section 313 shall be construed to affect the development and 
coordination of United States international trade policy or 
the administration of the United States trade agreements 
program. It is to be understood that the negotiation of 
International Insurance Agreements on Prudential Meas-
ures under such sections is consistent with the requirement 
of this subsection. 
‘‘(c) CONSULTATION.—The Secretary shall consult 
with the United States Trade Representative on the negotia-
tion of International Insurance Agreements on Prudential 
Measures, including prior to initiating and concluding any 
such agreements.’’. 
(b) DUTIES OF SECRETARY.—Section 321(a) of title 
31, United States Code, is amended—
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† HR 4173 EAS 
(1) in paragraph (7), by striking ‘‘; and’’ and 
inserting a semicolon; 
(2) in paragraph (8)(C), by striking the period 
at the end and inserting ‘‘; and’’; and 
(3) by adding at the end the following new para-
graph: 
‘‘(9) advise the President on major domestic and 
international prudential policy issues in connection 
with all lines of insurance except health insurance.’’. 
(c) CLERICAL AMENDMENT.—The table of sections for 
subchapter I of chapter 3 of title 31, United States Code, 
is amended by striking the item relating to section 312 and 
inserting the following new items: 
‘‘Sec. 312. Terrorism and financial intelligence. 
‘‘Sec. 313. Office of National Insurance. 
‘‘Sec. 314. International insurance agreements on prudential measures. 
‘‘Sec. 315. Continuing in office.’’. 
Subtitle B—State-based Insurance 
Reform 
SEC. 511. SHORT TITLE. 
This subtitle may be cited as the ‘‘Nonadmitted and 
Reinsurance Reform Act of 2010’’. 
SEC. 512. EFFECTIVE DATE. 
Except as otherwise specifically provided in this sub-
title, this subtitle shall take effect upon the expiration of 
the 12-month period beginning on the date of the enactment 
of this subtitle.
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† HR 4173 EAS 
PART I—NONADMITTED INSURANCE 
SEC. 521. REPORTING, PAYMENT, AND ALLOCATION OF PRE-
MIUM TAXES. 
(a) HOME
STATE’S
EXCLUSIVE
AUTHORITY.—No 
State other than the home State of an insured may require 
any premium tax payment for nonadmitted insurance. 
(b) 
ALLOCATION
OF
NONADMITTED
PREMIUM 
TAXES.— 
(1) IN GENERAL.—The States may enter into a 
compact or otherwise establish procedures to allocate 
among the States the premium taxes paid to an in-
sured’s home State described in subsection (a). 
(2) EFFECTIVE DATE.—Except as expressly oth-
erwise provided in such compact or other procedures, 
any such compact or other procedures— 
(A) if adopted on or before the expiration of 
the 330-day period that begins on the date of the 
enactment of this subtitle, shall apply to any 
premium taxes that, on or after such date of en-
actment, are required to be paid to any State 
that is subject to such compact or procedures; 
and 
(B) if adopted after the expiration of such 
330-day period, shall apply to any premium 
taxes that, on or after January 1 of the first cal-
endar year that begins after the expiration of
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† HR 4173 EAS 
such 330-day period, are required to be paid to 
any State that is subject to such compact or pro-
cedures. 
(3) REPORT.—Upon the expiration of the 330- 
day period referred to in paragraph (2), the NAIC 
may submit a report to the Committee on Financial 
Services and Committee on the Judiciary of the 
House of Representatives and the Committee on 
Banking, Housing, and Urban Affairs of the Senate 
identifying and describing any compact or other pro-
cedures for allocation among the States of premium 
taxes that have been adopted during such period by 
any States. 
(4) NATIONWIDE SYSTEM.—The Congress intends 
that each State adopt nationwide uniform require-
ments, forms, and procedures, such as an interstate 
compact, that provides for the reporting, payment, 
collection, and allocation of premium taxes for non-
admitted insurance consistent with this section. 
(c) ALLOCATION BASED
ON TAX ALLOCATION RE-
PORT.—To facilitate the payment of premium taxes among 
the States, an insured’s home State may require surplus 
lines brokers and insureds who have independently procured 
insurance to annually file tax allocation reports with the 
insured’s home State detailing the portion of the non-
405 
† HR 4173 EAS 
admitted insurance policy premium or premiums attrib-
utable to properties, risks, or exposures located in each 
State. The filing of a nonadmitted insurance tax allocation 
report and the payment of tax may be made by a person 
authorized by the insured to act as its agent. 
SEC. 522. REGULATION OF NONADMITTED INSURANCE BY 
INSURED’S HOME STATE. 
(a) HOME STATE AUTHORITY.—Except as otherwise 
provided in this section, the placement of nonadmitted in-
surance shall be subject to the statutory and regulatory re-
quirements solely of the insured’s home State. 
(b) BROKER LICENSING.—No State other than an in-
sured’s home State may require a surplus lines broker to 
be licensed in order to sell, solicit, or negotiate nonadmitted 
insurance with respect to such insured. 
(c) ENFORCEMENT PROVISION.—With respect to sec-
tion 521 and subsections (a) and (b) of this section, any 
law, regulation, provision, or action of any State that ap-
plies or purports to apply to nonadmitted insurance sold 
to, solicited by, or negotiated with an insured whose home 
State is another State shall be preempted with respect to 
such application. 
(d) WORKERS’ COMPENSATION EXCEPTION.—This sec-
tion may not be construed to preempt any State law, rule, 
or regulation that restricts the placement of workers’ com-
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† HR 4173 EAS 
pensation insurance or excess insurance for self-funded 
workers’ compensation plans with a nonadmitted insurer. 
SEC. 523. PARTICIPATION IN NATIONAL PRODUCER DATA-
BASE. 
After the expiration of the 2-year period beginning on 
the date of the enactment of this subtitle, a State may not 
collect any fees relating to licensing of an individual or en-
tity as a surplus lines broker in the State unless the State 
has in effect at such time laws or regulations that provide 
for participation by the State in the national insurance 
producer database of the NAIC, or any other equivalent uni-
form national database, for the licensure of surplus lines 
brokers and the renewal of such licenses. 
SEC. 524. UNIFORM STANDARDS FOR SURPLUS LINES ELIGI-
BILITY. 
A State may not— 
(1) impose eligibility requirements on, or other-
wise establish eligibility criteria for, nonadmitted in-
surers domiciled in a United States jurisdiction, ex-
cept in conformance with such requirements and cri-
teria in sections 5A(2) and 5C(2)(a) of the Non-Ad-
mitted Insurance Model Act, unless the State has 
adopted nationwide uniform requirements, forms, and 
procedures developed in accordance with section
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† HR 4173 EAS 
521(b) of this subtitle that include alternative nation-
wide uniform eligibility requirements; or 
(2) prohibit a surplus lines broker from placing 
nonadmitted insurance with, or procuring non-
admitted insurance from, a nonadmitted insurer 
domiciled outside the United States that is listed on 
the Quarterly Listing of Alien Insurers maintained 
by the International Insurers Department of the 
NAIC. 
SEC. 525. STREAMLINED APPLICATION FOR COMMERCIAL 
PURCHASERS. 
A surplus lines broker seeking to procure or place non-
admitted insurance in a State for an exempt commercial 
purchaser shall not be required to satisfy any State require-
ment to make a due diligence search to determine whether 
the full amount or type of insurance sought by such exempt 
commercial purchaser can be obtained from admitted insur-
ers if— 
(1) the broker procuring or placing the surplus 
lines insurance has disclosed to the exempt commer-
cial purchaser that such insurance may or may not 
be available from the admitted market that may pro-
vide greater protection with more regulatory over-
sight; and
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† HR 4173 EAS 
(2) the exempt commercial purchaser has subse-
quently requested in writing the broker to procure or 
place such insurance from a nonadmitted insurer. 
SEC. 526. GAO STUDY OF NONADMITTED INSURANCE MAR-
KET. 
(a) IN GENERAL.—The Comptroller General of the 
United States shall conduct a study of the nonadmitted in-
surance market to determine the effect of the enactment of 
this part on the size and market share of the nonadmitted 
insurance market for providing coverage typically provided 
by the admitted insurance market. 
(b) CONTENTS.—The study shall determine and ana-
lyze— 
(1) the change in the size and market share of 
the nonadmitted insurance market and in the number 
of insurance companies and insurance holding com-
panies providing such business in the 18-month pe-
riod that begins upon the effective date of this subtitle; 
(2) the extent to which insurance coverage typi-
cally provided by the admitted insurance market has 
shifted to the nonadmitted insurance market; 
(3) the consequences of any change in the size 
and market share of the nonadmitted insurance mar-
ket, including differences in the price and availability
409 
† HR 4173 EAS 
of coverage available in both the admitted and non-
admitted insurance markets; 
(4) the extent to which insurance companies and 
insurance holding companies that provide both ad-
mitted and nonadmitted insurance have experienced 
shifts in the volume of business between admitted and 
nonadmitted insurance; and 
(5) the extent to which there has been a change 
in the number of individuals who have nonadmitted 
insurance policies, the type of coverage provided 
under such policies, and whether such coverage is 
available in the admitted insurance market. 
(c) CONSULTATION WITH NAIC.—In conducting the 
study under this section, the Comptroller General shall con-
sult with the NAIC. 
(d) REPORT.—The Comptroller General shall complete 
the study under this section and submit a report to the 
Committee on Banking, Housing, and Urban Affairs of the 
Senate and the Committee on Financial Services of the 
House of Representatives regarding the findings of the study 
not later than 30 months after the effective date of this sub-
title. 
SEC. 527. DEFINITIONS. 
For purposes of this part, the following definitions 
shall apply:
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† HR 4173 EAS 
(1) ADMITTED INSURER.—The term ‘‘admitted 
insurer’’ means, with respect to a State, an insurer 
licensed to engage in the business of insurance in such 
State. 
(2) AFFILIATE.—The term ‘‘affiliate’’ means, 
with respect to an insured, any entity that controls, 
is controlled by, or is under common control with the 
insured. 
(3) AFFILIATED
GROUP.—The term ‘‘affiliated 
group’’ means any group of entities that are all affili-
ated. 
(4) CONTROL.—An entity has ‘‘control’’ over an-
other entity if— 
(A) the entity directly or indirectly or act-
ing through 1 or more other persons owns, con-
trols, or has the power to vote 25 percent or more 
of any class of voting securities of the other enti-
ty; or 
(B) the entity controls in any manner the 
election of a majority of the directors or trustees 
of the other entity. 
(5) EXEMPT
COMMERCIAL
PURCHASER.—The 
term ‘‘exempt commercial purchaser’’ means any per-
son purchasing commercial insurance that, at the 
time of placement, meets the following requirements:
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† HR 4173 EAS 
(A) The person employs or retains a quali-
fied risk manager to negotiate insurance cov-
erage. 
(B) The person has paid aggregate nation-
wide commercial property and casualty insur-
ance premiums in excess of $100,000 in the im-
mediately preceding 12 months. 
(C)(i) The person meets at least 1 of the fol-
lowing criteria: 
(I) The person possesses a net worth in 
excess of $20,000,000, as such amount is ad-
justed pursuant to clause (ii). 
(II) The person generates annual reve-
nues in excess of $50,000,000, as such 
amount is adjusted pursuant to clause (ii). 
(III) The person employs more than 
500 full-time or full-time equivalent em-
ployees per individual insured or is a mem-
ber of an affiliated group employing more 
than 1,000 employees in the aggregate. 
(IV) The person is a not-for-profit or-
ganization or public entity generating an-
nual budgeted expenditures of at least 
$30,000,000, as such amount is adjusted 
pursuant to clause (ii).
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† HR 4173 EAS 
(V) The person is a municipality with 
a population in excess of 50,000 persons. 
(ii) Effective on the fifth January 1 occur-
ring after the date of the enactment of this sub-
title and each fifth January 1 occurring there-
after, the amounts in subclauses (I), (II), and 
(IV) of clause (i) shall be adjusted to reflect the 
percentage change for such 5-year period in the 
Consumer Price Index for All Urban Consumers 
published by the Bureau of Labor Statistics of 
the Department of Labor. 
(6) HOME STATE.— 
(A) IN GENERAL.—Except as provided in 
subparagraph (B), the term ‘‘home State’’ 
means, with respect to an insured— 
(i) the State in which an insured 
maintains its principal place of business or, 
in the case of an individual, the individ-
ual’s principal residence; or 
(ii) if 100 percent of the insured risk 
is located out of the State referred to in sub-
paragraph (A), the State to which the great-
est percentage of the insured’s taxable pre-
mium for that insurance contract is allo-
cated.
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† HR 4173 EAS 
(B) AFFILIATED GROUPS.—If more than 1 
insured from an affiliated group are named in-
sureds on a single nonadmitted insurance con-
tract, the term ‘‘home State’’ means the home 
State, as determined pursuant to subparagraph 
(A), of the member of the affiliated group that 
has the largest percentage of premium attributed 
to it under such insurance contract. 
(7) INDEPENDENTLY
PROCURED
INSURANCE.— 
The term ‘‘independently procured insurance’’ means 
insurance procured directly by an insured from a 
nonadmitted insurer. 
(8) NAIC.—The term ‘‘NAIC’’ means the Na-
tional Association of Insurance Commissioners or any 
successor entity. 
(9) NONADMITTED INSURANCE.—The term ‘‘non-
admitted insurance’’ means any property and cas-
ualty insurance permitted to be placed directly or 
through a surplus lines broker with a nonadmitted in-
surer eligible to accept such insurance. 
(10) NON-ADMITTED INSURANCE MODEL ACT.— 
The term ‘‘Non-Admitted Insurance Model Act’’ 
means the provisions of the Non-Admitted Insurance 
Model Act, as adopted by the NAIC on August 3,
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† HR 4173 EAS 
1994, and amended on September 30, 1996, December 
6, 1997, October 2, 1999, and June 8, 2002. 
(11) NONADMITTED INSURER.—The term ‘‘non-
admitted insurer’’— 
(A) means, with respect to a State, an in-
surer not licensed to engage in the business of in-
surance in such State; but 
(B) does not include a risk retention group, 
as that term is defined in section 2(a)(4) of the 
Liability Risk Retention Act of 1986 (15 U.S.C. 
3901(a)(4)). 
(12) QUALIFIED
RISK
MANAGER.—The term 
‘‘qualified risk manager’’ means, with respect to a 
policyholder of commercial insurance, a person who 
meets all of the following requirements: 
(A) The person is an employee of, or third 
party consultant retained by, the commercial 
policyholder. 
(B) The person provides skilled services in 
loss prevention, loss reduction, or risk and insur-
ance coverage analysis, and purchase of insur-
ance. 
(C) The person— 
(i)(I) has a bachelor’s degree or higher 
from an accredited college or university in
415 
† HR 4173 EAS 
risk management, business administration, 
finance, economics, or any other field deter-
mined by a State insurance commissioner 
or other State regulatory official or entity 
to demonstrate minimum competence in 
risk management; and 
(II)(aa) has 3 years of experience in 
risk financing, claims administration, loss 
prevention, risk and insurance analysis, or 
purchasing commercial lines of insurance; 
or 
(bb) has 1 of the following designa-
tions: 
(AA) a designation as a Chartered 
Property and Casualty Underwriter 
(in this subparagraph referred to as 
‘‘CPCU’’) issued by the American In-
stitute for CPCU/Insurance Institute of 
America; 
(BB) a designation as an Asso-
ciate in Risk Management (ARM) 
issued by the American Institute for 
CPCU/Insurance Institute of America; 
(CC) a designation as Certified 
Risk Manager (CRM) issued by the
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† HR 4173 EAS 
National Alliance for Insurance Edu-
cation & Research; 
(DD) a designation as a RIMS 
Fellow (RF) issued by the Global Risk 
Management Institute; or 
(EE) any other designation, cer-
tification, or license determined by a 
State insurance commissioner or other 
State insurance regulatory official or 
entity to demonstrate minimum com-
petency in risk management; 
(ii)(I) has at least 7 years of experi-
ence in risk financing, claims administra-
tion, loss prevention, risk and insurance 
coverage analysis, or purchasing commer-
cial lines of insurance; and 
(II) has any 1 of the designations spec-
ified in subitems (AA) through (EE) of 
clause (i)(II)(bb); 
(iii) has at least 10 years of experience 
in risk financing, claims administration, 
loss prevention, risk and insurance coverage 
analysis, or purchasing commercial lines of 
insurance; or
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† HR 4173 EAS 
(iv) has a graduate degree from an ac-
credited college or university in risk man-
agement, business administration, finance, 
economics, or any other field determined by 
a State insurance commissioner or other 
State regulatory official or entity to dem-
onstrate minimum competence in risk man-
agement. 
(13) PREMIUM TAX.—The term ‘‘premium tax’’ 
means, with respect to surplus lines or independently 
procured insurance coverage, any tax, fee, assessment, 
or other charge imposed by a government entity di-
rectly or indirectly based on any payment made as 
consideration for an insurance contract for such in-
surance, including premium deposits, assessments, 
registration fees, and any other compensation given 
in consideration for a contract of insurance. 
(14) SURPLUS LINES BROKER.—The term ‘‘sur-
plus lines broker’’ means an individual, firm, or cor-
poration which is licensed in a State to sell, solicit, 
or negotiate insurance on properties, risks, or expo-
sures located or to be performed in a State with non-
admitted insurers.
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† HR 4173 EAS 
PART II—REINSURANCE 
SEC. 531. REGULATION OF CREDIT FOR REINSURANCE AND 
REINSURANCE AGREEMENTS. 
(a) CREDIT FOR REINSURANCE.—If the State of domi-
cile of a ceding insurer is an NAIC-accredited State, or has 
financial solvency requirements substantially similar to the 
requirements necessary for NAIC accreditation, and recog-
nizes credit for reinsurance for the insurer’s ceded risk, then 
no other State may deny such credit for reinsurance. 
(b) ADDITIONAL PREEMPTION OF EXTRATERRITORIAL 
APPLICATION OF STATE LAW.—In addition to the applica-
tion of subsection (a), all laws, regulations, provisions, or 
other actions of a State that is not the domiciliary State 
of the ceding insurer, except those with respect to taxes and 
assessments on insurance companies or insurance income, 
are preempted to the extent that they— 
(1) restrict or eliminate the rights of the ceding 
insurer or the assuming insurer to resolve disputes 
pursuant to contractual arbitration to the extent such 
contractual provision is not inconsistent with the pro-
visions of title 9, United States Code; 
(2) require that a certain State’s law shall gov-
ern the reinsurance contract, disputes arising from 
the reinsurance contract, or requirements of the rein-
surance contract;
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† HR 4173 EAS 
(3) attempt to enforce a reinsurance contract on 
terms different than those set forth in the reinsurance 
contract, to the extent that the terms are not incon-
sistent with this part; or 
(4) otherwise apply the laws of the State to rein-
surance agreements of ceding insurers not domiciled 
in that State. 
SEC. 532. REGULATION OF REINSURER SOLVENCY. 
(a) DOMICILIARY STATE REGULATION.—If the State 
of domicile of a reinsurer is an NAIC-accredited State or 
has financial solvency requirements substantially similar 
to the requirements necessary for NAIC accreditation, such 
State shall be solely responsible for regulating the financial 
solvency of the reinsurer. 
(b) NONDOMICILIARY STATES.— 
(1) LIMITATION ON FINANCIAL INFORMATION RE-
QUIREMENTS.—If the State of domicile of a reinsurer 
is an NAIC-accredited State or has financial solvency 
requirements substantially similar to the require-
ments necessary for NAIC accreditation, no other 
State may require the reinsurer to provide any addi-
tional financial information other than the informa-
tion the reinsurer is required to file with its domi-
ciliary State.
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† HR 4173 EAS 
(2) RECEIPT OF INFORMATION.—No provision of 
this section shall be construed as preventing or pro-
hibiting a State that is not the State of domicile of 
a reinsurer from receiving a copy of any financial 
statement filed with its domiciliary State. 
SEC. 533. DEFINITIONS. 
For purposes of this part, the following definitions 
shall apply: 
(1) CEDING
INSURER.—The term ‘‘ceding in-
surer’’ means an insurer that purchases reinsurance. 
(2) DOMICILIARY STATE.—The terms ‘‘State of 
domicile’’ and ‘‘domiciliary State’’ mean, with re-
spect to an insurer or reinsurer, the State in which 
the insurer or reinsurer is incorporated or entered 
through, and licensed. 
(3) REINSURANCE.—The term ‘‘reinsurance’’ 
means the assumption by an insurer of all or part of 
a risk undertaken originally by another insurer. 
(4) REINSURER.— 
(A) IN
GENERAL.—The term ‘‘reinsurer’’ 
means an insurer to the extent that the in-
surer— 
(i) is principally engaged in the busi-
ness of reinsurance;
421 
† HR 4173 EAS 
(ii) 
does 
not 
conduct 
significant 
amounts of direct insurance as a percentage 
of its net premiums; and 
(iii) is not engaged in an ongoing 
basis in the business of soliciting direct in-
surance. 
(B) DETERMINATION.—A determination of 
whether an insurer is a reinsurer shall be made 
under the laws of the State of domicile in accord-
ance with this paragraph. 
PART III—RULE OF CONSTRUCTION 
SEC. 541. RULE OF CONSTRUCTION. 
Nothing in this subtitle or the amendments made by 
this subtitle shall be construed to modify, impair, or super-
sede the application of the antitrust laws. Any implied or 
actual conflict between this subtitle and any amendments 
to this subtitle and the antitrust laws shall be resolved in 
favor of the operation of the antitrust laws. 
SEC. 542. SEVERABILITY. 
If any section or subsection of this subtitle, or any ap-
plication of such provision to any person or circumstance, 
is held to be unconstitutional, the remainder of this subtitle, 
and the application of the provision to any other person 
or circumstance, shall not be affected.
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† HR 4173 EAS 
TITLE 
VI—IMPROVEMENTS 
TO 
REGULATION OF BANK AND 
SAVINGS ASSOCIATION HOLD-
ING COMPANIES AND DEPOSI-
TORY INSTITUTIONS 
SEC. 601. SHORT TITLE. 
This title may be cited as the ‘‘Bank and Savings Asso-
ciation Holding Company and Depository Institution Reg-
ulatory Improvements Act of 2010’’. 
SEC. 602. DEFINITION. 
In this title, the term ‘‘commercial firm’’ means any 
entity that derives not less than 15 percent of the consoli-
dated annual gross revenues of the entity, including all af-
filiates of the entity, from engaging in activities that are 
not financial in nature or incidental to activities that are 
financial in nature, as provided in section 4(k) of the Bank 
Holding Company Act of 1956 (12 U.S.C. 1843(k)). 
SEC. 603. MORATORIUM AND STUDY ON TREATMENT OF 
CREDIT CARD BANKS, INDUSTRIAL LOAN 
COMPANIES, AND CERTAIN OTHER COMPA-
NIES UNDER THE BANK HOLDING COMPANY 
ACT OF 1956. 
(a) MORATORIUM.— 
(1) DEFINITIONS.—In this subsection—
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† HR 4173 EAS 
(A) the term ‘‘credit card bank’’ means an 
institution described in section 2(c)(2)(F) of the 
Bank Holding Company Act of 1956 (12 U.S.C. 
1841(c)(2)(F)); 
(B) the term ‘‘industrial bank’’ means an 
institution described in section 2(c)(2)(H) of the 
Bank Holding Company Act of 1956 (12 U.S.C. 
1841(c)(2)(H)); and 
(C) the term ‘‘trust bank’’ means an institu-
tion described in section 2(c)(2)(D) of the Bank 
Holding Company Act of 1956 (12 U.S.C. 
1841(c)(2)(D)). 
(2) MORATORIUM ON PROVISION OF DEPOSIT IN-
SURANCE.—The Corporation may not approve an ap-
plication for deposit insurance under section 5 of the 
Federal Deposit Insurance Act (12 U.S.C. 1815) that 
is received after November 10, 2009, for an industrial 
bank, a credit card bank, or a trust bank that is di-
rectly or indirectly owned or controlled by a commer-
cial firm. 
(3) CHANGE IN CONTROL.— 
(A) IN GENERAL.—Except as provided in 
subparagraph (B), the appropriate Federal 
banking agency shall disapprove a change in 
control, as provided in section 7(j) of the Federal
424 
† HR 4173 EAS 
Deposit Insurance Act (12 U.S.C. 1817(j)), of an 
industrial bank, a credit card bank, or a trust 
bank if the change in control would result in di-
rect or indirect control of the industrial bank, 
credit card bank, or trust bank by a commercial 
firm. 
(B) EXCEPTIONS.—Subparagraph (A) shall 
not apply to a change in control of an industrial 
bank, credit card bank, or trust bank that— 
(i) is in danger of default, as deter-
mined by the appropriate Federal banking 
agency; or 
(ii) results from the merger or whole 
acquisition of a commercial firm that di-
rectly or indirectly controls the industrial 
bank, credit card bank, or trust bank in a 
bona fide merger with or acquisition by an-
other commercial firm, as determined by the 
appropriate Federal banking agency. 
(4) SUNSET.—This subsection shall cease to have 
effect 3 years after the date of enactment of this Act. 
(b) GOVERNMENT ACCOUNTABILITY OFFICE STUDY OF 
EXCEPTIONS UNDER THE BANK HOLDING COMPANY ACT 
OF 1956.—
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† HR 4173 EAS 
(1) STUDY REQUIRED.—The Comptroller General 
of the United States shall carry out a study to deter-
mine whether it is necessary, in order to strengthen 
the safety and soundness of institutions or the sta-
bility of the financial system, to eliminate the excep-
tions under section 2 of the Bank Holding Company 
Act of 1956 (12 U.S.C. 1841) for institutions de-
scribed in— 
(A) section 2(a)(5)(E) of the Bank Holding 
Company Act of 1956 (12 U.S.C. 1841(a)(5)(E)); 
(B) section 2(a)(5)(F) of the Bank Holding 
Company Act of 1956 (12 U.S.C. 1841(a)(5)(F)); 
(C) section 2(c)(2)(D) of the Bank Holding 
Company Act of 1956 (12 U.S.C. 1841(c)(2)(D)); 
(D) section 2(c)(2)(F) of the Bank Holding 
Company Act of 1956 (12 U.S.C. 1841(c)(2)(F)); 
(E) section 2(c)(2)(H) of the Bank Holding 
Company Act of 1956 (12 U.S.C. 1841(c)(2)(H)); 
and 
(F) section 2(c)(2)(B) of the Bank Holding 
Company Act of 1956 (12 U.S.C. 1841(c)(2)(B)). 
(2) CONTENT OF STUDY.— 
(A) IN
GENERAL.—The study required 
under paragraph (1), with respect to the institu-
tions referenced in each of subparagraphs (A)
426 
† HR 4173 EAS 
through (E) of paragraph (1), shall, to the extent 
feasible be based on information provided to the 
Comptroller General by the appropriate Federal 
or State regulator, and shall— 
(i) identify the types and number of 
institutions excepted from section 2 of the 
Bank Holding Company Act of 1956 (12 
U.S.C. 1841) under each of the subpara-
graphs described in subparagraphs (A) 
through (E) of paragraph (1); 
(ii) generally describe the size and geo-
graphic locations of the institutions de-
scribed in clause (i); 
(iii) determine the extent to which the 
institutions described in clause (i) are held 
by holding companies that are commercial 
firms; 
(iv) determine whether the institutions 
described in clause (i) have any affiliates 
that are commercial firms; 
(v) identify the Federal banking agen-
cy responsible for the supervision of the in-
stitutions described in clause (i) on and 
after the transfer date;
427 
† HR 4173 EAS 
(vi) determine the adequacy of the Fed-
eral bank regulatory framework applicable 
to each category of institution described in 
clause (i), including any restrictions (in-
cluding limitations on affiliate transactions 
or cross-marketing) that apply to trans-
actions between an institution, the holding 
company of the institution, and any other 
affiliate of the institution; and 
(vii) 
evaluate 
the 
potential 
con-
sequences of subjecting the institutions de-
scribed in clause (i) to the requirements of 
the Bank Holding Company Act of 1956, 
including with respect to the availability 
and allocation of credit, the stability of the 
financial system and the economy, the safe 
and sound operation of each category of in-
stitution, and the impact on the types of ac-
tivities in which such institutions, and the 
holding companies of such institutions, may 
engage. 
(B) SAVINGS ASSOCIATIONS.—With respect 
to institutions described in paragraph (1)(F), the 
study required under paragraph (1) shall—
428 
† HR 4173 EAS 
(i) determine the adequacy of the Fed-
eral bank regulatory framework applicable 
to such institutions, including any restric-
tions (including limitations on affiliate 
transactions or cross-marketing) that apply 
to transactions between an institution, the 
holding company of the institution, and 
any other affiliate of the institution; and 
(ii) evaluate the potential consequences 
of subjecting the institutions described in 
paragraph (1)(F) to the requirements of the 
Bank Holding Company Act of 1956, in-
cluding with respect to the availability and 
allocation of credit, the stability of the fi-
nancial system and the economy, the safe 
and sound operation of such institutions, 
and the impact on the types of activities in 
which such institutions, and the holding 
companies of such institutions, may engage. 
(3) REPORT.—Not later than 18 months after the 
date of enactment of this Act, the Comptroller General 
shall submit to the Committee on Banking, Housing, 
and Urban Affairs of the Senate and the Committee 
on Financial Services of the House of Representatives 
a report on the study required under paragraph (1).
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† HR 4173 EAS 
SEC. 604. REPORTS AND EXAMINATIONS OF HOLDING COM-
PANIES; 
REGULATION 
OF 
FUNCTIONALLY 
REGULATED SUBSIDIARIES. 
(a) REPORTS BY BANK HOLDING COMPANIES.—Sec-
tions 5(c)(1) of the Bank Holding Company Act of 1956 
(12 U.S.C. 1844(c)(1)) is amended— 
(1) by striking subparagraph (B) and inserting 
the following: 
‘‘(B) USE
OF
EXISTING
REPORTS
AND 
OTHER
SUPERVISORY
INFORMATION.—The ap-
propriate Federal banking agency for a bank 
holding company shall, to the fullest extent pos-
sible, use— 
‘‘(i) reports and other supervisory in-
formation that the bank holding company 
or any subsidiary thereof has been required 
to provide to other Federal or State regu-
latory agencies; 
‘‘(ii) externally audited financial state-
ments of the bank holding company or sub-
sidiary; 
‘‘(iii) information otherwise available 
from Federal or State regulatory agencies; 
and 
‘‘(iv) information that is otherwise re-
quired to be reported publicly.’’; and
430 
† HR 4173 EAS 
(2) by adding at the end the following: 
‘‘(C) AVAILABILITY.—Upon the request of 
the appropriate Federal banking agency for a 
bank holding company, the bank holding com-
pany or a subsidiary of the bank holding com-
pany shall promptly provide to the appropriate 
Federal banking agency any information de-
scribed in clauses (i) through (iii) of subpara-
graph (B).’’. 
(b) EXAMINATIONS OF BANK HOLDING COMPANIES.— 
Section 5(c)(2) of the Bank Holding Company Act of 1956 
(12 U.S.C. 1844(c)(2)) is amended to read as follows: 
‘‘(2) EXAMINATIONS.— 
‘‘(A) IN GENERAL.—The appropriate Fed-
eral banking agency for a bank holding company 
may make examinations of the bank holding 
company and each subsidiary of the bank hold-
ing company in order to— 
‘‘(i) inform such appropriate Federal 
banking agency of— 
‘‘(I) the nature of the operations 
and financial condition of the bank 
holding company and the subsidiary; 
‘‘(II) the financial, operational, 
and other risks within the bank hold-
431 
† HR 4173 EAS 
ing company system that may pose a 
threat to— 
‘‘(aa) the safety and sound-
ness of the bank holding company 
or of any depository institution 
subsidiary of the bank holding 
company; or 
‘‘(bb) the stability of the fi-
nancial system of the United 
States; and 
‘‘(III) the systems of the bank 
holding company for monitoring and 
controlling the risks described in sub-
clause (II); and 
‘‘(ii) enforce the compliance of the bank 
holding company and the subsidiary with 
this Act and any other Federal law that 
such appropriate Federal banking agency 
has specific jurisdiction to enforce against 
the bank holding company or subsidiary. 
‘‘(B) USE OF REPORTS TO REDUCE EXAMI-
NATIONS.—For purposes of this paragraph, the 
appropriate Federal banking agency for a bank 
holding company shall, to the fullest extent pos-
sible, rely on—
432 
† HR 4173 EAS 
‘‘(i) examination reports made by 
other Federal or State regulatory agencies 
relating to the bank holding company and 
any subsidiary of the bank holding com-
pany; and 
‘‘(ii) the reports and other information 
required under paragraph (1). 
‘‘(C) COORDINATION
WITH
OTHER
REGU-
LATORS.—The 
appropriate 
Federal 
banking 
agency for a bank holding company shall— 
‘‘(i) provide reasonable notice to, and 
consult with, the appropriate Federal bank-
ing agency or State regulatory agency of a 
subsidiary that is a depository institution 
or a functionally regulated subsidiary before 
commencing an examination of the sub-
sidiary under this section; and 
‘‘(ii) to the fullest extent possible, avoid 
duplication of examination activities, re-
porting requirements, and requests for in-
formation.’’. 
(c) AUTHORITY TO REGULATE FUNCTIONALLY REGU-
LATED SUBSIDIARIES OF BANK HOLDING COMPANIES.— 
The Bank Holding Company Act of 1956 (12 U.S.C. 1841 
et seq.) is amended—
433 
† HR 4173 EAS 
(1) in section 5(c) (12 U.S.C. 1844(c)), by strik-
ing paragraphs (3) and (4) and inserting the fol-
lowing: 
‘‘(3) [Reserved] 
‘‘(4) [Reserved]’’; and 
(2) by striking section 10A (12 U.S.C. 1848a). 
(d) ACQUISITIONS OF BANKS.—Section 3(c) of the 
Bank Holding Company Act of 1956 (12 U.S.C. 1842(c)) 
is amended by adding at the end the following: 
‘‘(7) FINANCIAL STABILITY.—In every case, the 
appropriate Federal banking agency of a bank hold-
ing company shall take into consideration the extent 
to which a proposed acquisition, merger, or consolida-
tion would result in greater or more concentrated 
risks to the stability of the United States banking or 
financial system.’’. 
(e) ACQUISITIONS OF NONBANKS.— 
(1) NOTICE PROCEDURES.—Section 4(j)(2)(A) of 
the Bank Holding Company Act of 1956 (12 U.S.C. 
1843(j)(2)(A)) is amended by striking ‘‘or unsound 
banking practices’’ and inserting ‘‘unsound banking 
practices, or risk to the stability of the United States 
banking or financial system’’. 
(2) ACTIVITIES
THAT
ARE
FINANCIAL
IN
NA-
TURE.—Section 4(k)(6)(B) of the Bank Holding Com-
434 
† HR 4173 EAS 
pany Act of 1956 (12 U.S.C. 1843(k)(6)(B)) is 
amended to read as follows: 
‘‘(B) APPROVAL NOT REQUIRED FOR CER-
TAIN FINANCIAL ACTIVITIES.— 
‘‘(i) IN GENERAL.—Except as provided 
in clause (ii), a financial holding company 
may commence any activity or acquire any 
company, pursuant to paragraph (4) or 
any regulation prescribed or order issued 
under paragraph (5), without prior ap-
proval of the appropriate Federal banking 
agency for the financial holding company. 
‘‘(ii) EXCEPTION.—A financial holding 
company may not acquire a company, 
without the prior approval of the appro-
priate Federal banking agency for the fi-
nancial holding company, in a transaction 
in which the total consolidated assets to be 
acquired by the financial holding company 
exceed $25,000,000,000.’’. 
(f) BANK
MERGER
ACT
TRANSACTIONS.—Section 
18(c)(5) of the Federal Deposit Insurance Act (12 U.S.C. 
1828(c)(5)) is amended, in the matter immediately fol-
lowing subparagraph (B), by striking ‘‘and the convenience 
and needs of the community to be served’’ and inserting
435 
† HR 4173 EAS 
‘‘the convenience and needs of the community to be served, 
and the risk to the stability of the United States banking 
or financial system’’. 
(g) REPORTS BY SAVINGS AND LOAN HOLDING COMPA-
NIES.—Section 10(b)(2) of the Home Owners’ Loan Act (12 
U.S.C. 1467a(b)(2) is amended— 
(1) by striking ‘‘Each savings’’ and inserting the 
following: 
‘‘(A) IN GENERAL.—Each savings’’; and 
(2) by adding at the end the following: 
‘‘(B) USE
OF
EXISTING
REPORTS
AND 
OTHER
SUPERVISORY
INFORMATION.—The ap-
propriate Federal banking agency for a savings 
and loan holding company shall, to the fullest 
extent possible, use— 
‘‘(i) reports and other supervisory in-
formation that the savings and loan holding 
company or any subsidiary thereof has been 
required to provide to other Federal or 
State regulatory agencies; 
‘‘(ii) externally audited financial state-
ments of the savings and loan holding com-
pany or subsidiary;
436 
† HR 4173 EAS 
‘‘(iii) information that is otherwise 
available from Federal or State regulatory 
agencies; and 
‘‘(iv) information that is otherwise re-
quired to be reported publicly. 
‘‘(C) AVAILABILITY.—Upon the request of 
the appropriate Federal banking agency for a 
savings and loan holding company, the savings 
and loan holding company or a subsidiary of the 
savings and loan holding company shall prompt-
ly provide to the appropriate Federal banking 
agency any information described in clauses (i) 
through (iii) of subparagraph (B).’’. 
(h) EXAMINATION OF SAVINGS AND LOAN HOLDING 
COMPANIES.— 
(1) DEFINITIONS.—Section 2 of the Home Own-
ers’ Loan Act (12 U.S.C. 1462) is amended by adding 
at the end the following: 
‘‘(10) APPROPRIATE
FEDERAL
BANKING
AGEN-
CY.—The term ‘appropriate Federal banking agency’ 
has the same meaning as in section 3(q) of the Fed-
eral Deposit Insurance Act (12 U.S.C. 1813(q)). 
‘‘(11) 
FUNCTIONALLY
REGULATED
SUB-
SIDIARY.—The term ‘functionally regulated sub-
sidiary’ has the same meaning as in section 5(c)(5)
437 
† HR 4173 EAS 
of the Bank Holding Company Act of 1956 (12 
U.S.C. 1844(c)(5)).’’. 
(2) EXAMINATION.—Section 10(b) of the Home 
Owners’ Loan Act (12 U.S.C. 1467a(b)) is amended 
by striking paragraph (4) and inserting the following: 
‘‘(4) EXAMINATIONS.— 
‘‘(A) IN GENERAL.—The appropriate Fed-
eral banking agency for a savings and loan hold-
ing company may make examinations of the sav-
ings and loan holding company and each sub-
sidiary of the savings and loan holding company 
system, in order to— 
‘‘(i) inform such appropriate Federal 
banking agency of— 
‘‘(I) the nature of the operations 
and financial condition of the savings 
and loan holding company and the 
subsidiary; 
‘‘(II) the financial, operational, 
and other risks within the savings and 
loan holding company that may pose a 
threat to— 
‘‘(aa) the safety and sound-
ness of the savings and loan hold-
ing company or of any depository
438 
† HR 4173 EAS 
institution subsidiary of the sav-
ings and loan holding company; 
or 
‘‘(bb) the stability of the fi-
nancial system of the United 
States; and 
‘‘(III) the systems of the savings 
and loan holding company for moni-
toring and controlling the risks de-
scribed in subclause (II); and 
‘‘(ii) enforce the compliance of the sav-
ings and loan holding company and the 
subsidiary with this Act and any other Fed-
eral law that such appropriate Federal 
banking agency has specific jurisdiction to 
enforce against the savings and loan hold-
ing company or subsidiary. 
‘‘(B) USE OF REPORTS TO REDUCE EXAMI-
NATIONS.—For purposes of this subsection, the 
appropriate Federal banking agency for a sav-
ings and loan holding company shall, to the full-
est extent possible, rely on— 
‘‘(i) the examination reports made by 
other Federal or State regulatory agencies
439 
† HR 4173 EAS 
relating to the savings and loan holding 
company and any subsidiary; and 
‘‘(ii) the reports and other information 
required under paragraph (2). 
‘‘(C) COORDINATION
WITH
OTHER
REGU-
LATORS.—The 
appropriate 
Federal 
banking 
agency for a savings and loan holding company 
shall— 
‘‘(i) provide reasonable notice to, and 
consult with, the appropriate Federal bank-
ing agency or State regulatory agency of a 
subsidiary that is a depository institution 
or a functionally regulated subsidiary before 
commencing an examination of the sub-
sidiary under this section; and 
‘‘(ii) to the fullest extent possible, avoid 
duplication of examination activities, re-
porting requirements, and requests for in-
formation.’’. 
(i) EFFECTIVE DATE.—The amendments made by this 
section shall take effect on the transfer date.
440 
† HR 4173 EAS 
SEC. 605. ASSURING CONSISTENT OVERSIGHT OF PERMIS-
SIBLE ACTIVITIES OF DEPOSITORY INSTITU-
TION SUBSIDIARIES OF HOLDING COMPA-
NIES. 
Section 6 of the Bank Holding Company Act of 1956 
(12 U.S.C. 1845) is amended to read as follows: 
‘‘SEC. 6. ASSURING CONSISTENT OVERSIGHT OF PERMIS-
SIBLE ACTIVITIES OF DEPOSITORY INSTITU-
TION SUBSIDIARIES OF HOLDING COMPA-
NIES. 
‘‘(a) DEFINITIONS.— 
‘‘(1) DEFINITIONS.—In this section— 
‘‘(A) the term ‘depository institution hold-
ing company’ has the same meaning as in sec-
tion 3(w) of the Federal Deposit Insurance Act 
(12 U.S.C. 1813(w)); 
‘‘(B) the term ‘functionally regulated sub-
sidiary’ has the same meaning as in section 
5(c)(5); and 
‘‘(C) the term ‘lead Federal banking agency’ 
means— 
‘‘(i) the Office of the Comptroller of the 
Currency, in the case of any depository in-
stitution holding company having— 
‘‘(I) a subsidiary that is an in-
sured depository institution, if all such
441 
† HR 4173 EAS 
insured depository institutions are 
Federal depository institutions; or 
‘‘(II) a subsidiary that is a Fed-
eral depository institution and a sub-
sidiary that is a State depository in-
stitution, if the total consolidated as-
sets of all subsidiaries that are Federal 
depository institutions exceed the total 
consolidated assets of all subsidiaries 
that are State depository institutions; 
and 
‘‘(ii) the Federal Deposit Insurance 
Corporation, in the case of any depository 
institution holding company having— 
‘‘(I) a subsidiary that is an in-
sured depository institution, if all such 
insured depository institutions are 
State depository institutions; or 
‘‘(II) a subsidiary that is a Fed-
eral depository institution and a sub-
sidiary that is a State depository in-
stitution, if the total consolidated as-
sets of all subsidiaries that are State 
depository institutions exceed the total 
consolidated assets of all subsidiaries
442 
† HR 4173 EAS 
that are Federal depository institu-
tions. 
‘‘(2) DETERMINATION OF TOTAL CONSOLIDATED 
ASSETS.—For purposes of paragraph (1)(A), the total 
consolidated assets of a depository institution shall be 
determined in the same manner that total consoli-
dated assets of depository institutions are determined 
for purposes of section 3(q) of the Federal Deposit In-
surance Act (12 U.S.C. 1813(q)). 
‘‘(b) LEAD AGENCY SUPERVISION.— 
‘‘(1) IN
GENERAL.—The lead Federal banking 
agency for each depository institution holding com-
pany shall make examinations of the activities of each 
nondepository institution subsidiary (other than a 
functionally regulated subsidiary) of the depository 
institution holding company that are permissible for 
depository institution subsidiaries of the depository 
institution holding company, to determine whether 
the activities— 
‘‘(A) present safety and soundness risks to 
any depository institution subsidiary of the de-
pository institution holding company; 
‘‘(B) are conducted in accordance with ap-
plicable law; and
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‘‘(C) are subject to appropriate systems for 
monitoring and controlling the financial, oper-
ating, and other risks of the activity and pro-
tecting the depository institution subsidiaries of 
the holding company. 
‘‘(2) PROCESS FOR EXAMINATION.—An examina-
tion under paragraph (1) shall be carried out under 
the authority of the lead Federal banking agency, as 
if the nondepository institution subsidiary were an 
insured depository institution for which the lead Fed-
eral banking agency is the appropriate Federal bank-
ing agency. 
‘‘(c) COORDINATION.—For each depository institution 
holding company for which the Board of Governors is the 
appropriate Federal banking agency, the lead Federal bank-
ing agency of the depository institution holding company 
shall coordinate the supervision of the activities of subsidi-
aries described in subsection (b) with the Board of Gov-
ernors, in a manner that— 
‘‘(1) avoids duplication; 
‘‘(2) shares information relevant to the super-
vision of the depository institution holding company 
by each agency; 
‘‘(3) achieves the objectives of subsection (b); and
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‘‘(4) ensures that the depository institution hold-
ing company and the subsidiaries of the depository 
institution holding company are not subject to con-
flicting supervisory demands by the 2 agencies. 
‘‘(d) REFERRALS FOR ENFORCEMENT.— 
‘‘(1) RECOMMENDATION OF ACTION BY BOARD OF 
GOVERNORS.—The lead Federal banking agency for a 
depository institution holding company, based on in-
formation obtained pursuant to the responsibilities of 
the agency under subsection (b), may submit to the 
Board of Governors, in writing, a recommendation 
that the Board of Governors take enforcement action 
against a nondepository institution subsidiary (other 
than a functionally regulated subsidiary) of the de-
pository institution holding company, together with 
an explanation of the concerns giving rise to the rec-
ommendation. 
‘‘(2) BACK-UP AUTHORITY OF THE LEAD FED-
ERAL BANKING AGENCY.—If, within the 60-day period 
beginning on the date on which the Board of Gov-
ernors receives a recommendation under paragraph 
(1), the Board of Governors does not take enforcement 
action against a nondepository institution subsidiary 
or provide a plan for enforcement action that is ac-
ceptable to the lead Federal banking agency, the lead
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† HR 4173 EAS 
Federal banking agency (upon the authorization of 
the Comptroller, or the Federal Deposit Insurance 
Corporation, upon a vote of its members, as applica-
ble) may take the recommended enforcement action, in 
the same manner as if the subsidiary were an insured 
depository institution for which the lead Federal 
banking agency is the appropriate Federal banking 
agency.’’. 
SEC. 606. REQUIREMENTS FOR FINANCIAL HOLDING COM-
PANIES TO REMAIN WELL CAPITALIZED AND 
WELL MANAGED. 
(a) AMENDMENT.—Section 4(l)(1) of the Bank Hold-
ing Company Act of 1956 (12 U.S.C. 1843(l)(1)) is amend-
ed— 
(1) in subparagraph (B), by striking ‘‘and’’ at 
the end; 
(2) by redesignating subparagraph (C) as sub-
paragraph (D); 
(3) by inserting after subparagraph (B) the fol-
lowing: 
‘‘(C) the bank holding company is well cap-
italized and well managed; and’’; and 
(4) in subparagraph (D)(ii), as so redesignated, 
by striking ‘‘subparagraphs (A) and (B)’’ and insert-
ing ‘‘subparagraphs (A), (B), and (C)’’.
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† HR 4173 EAS 
(b) EFFECTIVE DATE.—The amendments made by this 
section shall take effect on the transfer date. 
SEC. 607. STANDARDS FOR INTERSTATE ACQUISITIONS. 
(a) ACQUISITION OF BANKS.—Section 3(d)(1)(A) of 
the Bank Holding Company Act of 1956 (12 U.S.C. 
1842(d)(1)(A)) is amended by striking ‘‘adequately capital-
ized and adequately managed’’ and inserting ‘‘well capital-
ized and well managed’’. 
(b) 
INTERSTATE
BANK
MERGERS.—Section 
44(b)(4)(B) of the Federal Deposit Insurance Act (12 U.S.C. 
1831u(b)(4)(B)) is amended by striking ‘‘will continue to 
be adequately capitalized and adequately managed’’ and in-
serting ‘‘will be well capitalized and well managed’’. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall take effect on the transfer date. 
SEC. 608. ENHANCING EXISTING RESTRICTIONS ON BANK 
TRANSACTIONS WITH AFFILIATES. 
(a) AFFILIATE TRANSACTIONS.—Section 23A of the 
Federal Reserve Act (12 U.S.C. 371c) is amended— 
(1) in subsection (b)— 
(A) in paragraph (1), by striking subpara-
graph (D) and inserting the following: 
‘‘(D) any investment fund with respect to 
which a member bank or affiliate thereof is an 
investment adviser; and’’; and
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† HR 4173 EAS 
(B) in paragraph (7)— 
(i) in subparagraph (A), by inserting 
before the semicolon at the end the fol-
lowing: ‘‘, including a purchase of assets 
subject to an agreement to repurchase’’; 
(ii) in subparagraph (C), by striking 
‘‘, including assets subject to an agreement 
to repurchase,’’; 
(iii) in subparagraph (D)— 
(I) by inserting ‘‘or other debt ob-
ligations’’ after ‘‘acceptance of securi-
ties’’; and 
(II) by striking ‘‘or’’ at the end; 
and 
(iv) by adding at the end the following: 
‘‘(F) a transaction with an affiliate that in-
volves the borrowing or lending of securities, to 
the extent that the transaction causes a member 
bank or a subsidiary to have credit exposure to 
the affiliate; or 
‘‘(G) a derivative transaction, as defined in 
paragraph (3) of section 5200(b) of the Revised 
Statutes of the United States (12 U.S.C. 84(b)), 
with an affiliate, to the extent that the trans-
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† HR 4173 EAS 
action causes a member bank or a subsidiary to 
have credit exposure to the affiliate;’’; 
(2) in subsection (c)— 
(A) in paragraph (1)— 
(i) in the matter preceding subpara-
graph (A), by striking ‘‘subsidiary’’ and all 
that follows through ‘‘time of the trans-
action’’ and inserting ‘‘subsidiary, and any 
credit exposure of a member bank or a sub-
sidiary to an affiliate resulting from a secu-
rities borrowing or lending transaction, or 
a derivative transaction, shall be secured at 
all times’’; and 
(ii) in each of subparagraphs (A) 
through (D), by striking ‘‘or letter of credit’’ 
and inserting ‘‘letter of credit, or credit ex-
posure’’; 
(B) by striking paragraph (2); 
(C) 
by 
redesignating 
paragraphs 
(3) 
through (5) as paragraphs (2) through (4), re-
spectively; 
(D) in paragraph (2), as so redesignated, by 
inserting before the period at the end ‘‘, or credit 
exposure to an affiliate resulting from a securi-
449 
† HR 4173 EAS 
ties borrowing or lending transaction, or deriva-
tive transaction’’; and 
(E) in paragraph (3), as so redesignated— 
(i) by inserting ‘‘or other debt obliga-
tions’’ after ‘‘securities’’; and 
(ii) by striking ‘‘or guarantee’’ and all 
that follows through ‘‘behalf of,’’ and insert-
ing ‘‘guarantee, acceptance, or letter of cred-
it issued on behalf of, or credit exposure 
from a securities borrowing or lending 
transaction, or derivative transaction to,’’; 
(3) in subsection (d)(4), in the matter preceding 
subparagraph (A), by striking ‘‘or issuing’’ and all 
that follows through ‘‘behalf of,’’ and inserting 
‘‘issuing a guarantee, acceptance, or letter of credit on 
behalf of, or having credit exposure resulting from a 
securities borrowing or lending transaction, or deriva-
tive transaction to,’’; and 
(4) in subsection (f)— 
(A) in paragraph (2)— 
(i) by striking ‘‘or order’’; 
(ii) by striking ‘‘if it finds’’ and all 
that follows through the end of the para-
graph and inserting the following: ‘‘if—
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† HR 4173 EAS 
‘‘(i) the Board finds the exemption to 
be in the public interest and consistent with 
the purposes of this section, and notifies the 
Federal Deposit Insurance Corporation of 
such finding; and 
‘‘(ii) before the end of the 60-day pe-
riod beginning on the date on which the 
Federal Deposit Insurance Corporation re-
ceives notice of the finding under clause (i), 
the Federal Deposit Insurance Corporation 
does not object, in writing, to the finding, 
based on a determination that the exemp-
tion presents an unacceptable risk to the 
Deposit Insurance Fund.’’; 
(iii) by striking the Board and insert-
ing the following: 
‘‘(A) IN GENERAL.—The Board’’; and 
(iv) by adding at the end the following: 
‘‘(B) ADDITIONAL EXEMPTIONS.— 
‘‘(i) NATIONAL
BANKS.—The Comp-
troller of the Currency may, by order, ex-
empt a transaction of a national bank from 
the requirements of this section if— 
‘‘(I) the Board and the Office of 
the Comptroller of the Currency jointly
451 
† HR 4173 EAS 
find the exemption to be in the public 
interest and consistent with the pur-
poses of this section and notify the 
Federal Deposit Insurance Corporation 
of such finding; and 
‘‘(II) before the end of the 60-day 
period beginning on the date on which 
the Federal Deposit Insurance Cor-
poration receives notice of the finding 
under subclause (I), the Federal De-
posit Insurance Corporation does not 
object, in writing, to the finding, based 
on a determination that the exemption 
presents an unacceptable risk to the 
Deposit Insurance Fund. 
‘‘(ii) STATE BANKS.—The Federal De-
posit Insurance Corporation may, by order, 
exempt a transaction of a State nonmember 
bank, and the Board may, by order, exempt 
a transaction of a State member bank, from 
the requirements of this section if— 
‘‘(I) the Board and the Federal 
Deposit Insurance Corporation jointly 
find that the exemption is in the public
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† HR 4173 EAS 
interest and consistent with the pur-
poses of this section; and 
‘‘(II) the Federal Deposit Insur-
ance Corporation finds that the exemp-
tion does not present an unacceptable 
risk to the Deposit Insurance Fund.’’; 
and 
(B) by adding at the end the following: 
‘‘(4) AMOUNTS
OF
COVERED
TRANSACTIONS.— 
The Board may issue such regulations or interpreta-
tions as the Board determines are necessary or appro-
priate with respect to the manner in which a netting 
agreement may be taken into account in determining 
the amount of a covered transaction between a mem-
ber bank or a subsidiary and an affiliate, including 
the extent to which netting agreements between a 
member bank or a subsidiary and an affiliate may be 
taken into account in determining whether a covered 
transaction is fully secured for purposes of subsection 
(d)(4). An interpretation under this paragraph with 
respect to a specific member bank, subsidiary, or affil-
iate shall be issued jointly with the appropriate Fed-
eral banking agency for such member bank, sub-
sidiary, or affiliate.’’.
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† HR 4173 EAS 
(b) 
TRANSACTIONS
WITH
AFFILIATES.—Section 
23B(e) of the Federal Reserve Act (12 U.S.C. 371c–1(e)) is 
amended— 
(1) by striking the undesignated matter following 
subparagraph (B); 
(2) by redesignating subparagraphs (A) and (B) 
as clauses (i) and (ii), respectively, and adjusting the 
clause margins accordingly; 
(3) by redesignating paragraphs (1) and (2) as 
subparagraphs (A) and (B), respectively, and adjust-
ing the subparagraph margins accordingly; 
(4) by striking ‘‘The Board’’ and inserting the 
following: 
‘‘(1) IN GENERAL.—The Board’’; 
(5) in paragraph (1)(B), as so redesignated— 
(A) in the matter preceding clause (i), by 
inserting before ‘‘regulations’’ the following: 
‘‘subject to paragraph (2), if the Board finds 
that an exemption or exclusion is in the public 
interest and is consistent with the purposes of 
this section, and notifies the Federal Deposit In-
surance Corporation of such finding,’’; and 
(B) in clause (ii), by striking the comma at 
the end and inserting a period; and 
(6) by adding at the end the following:
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† HR 4173 EAS 
‘‘(2) EXCEPTION.—The Board may grant an ex-
emption or exclusion under this subsection only if, 
during the 60-day period beginning on the date of re-
ceipt of notice of the finding from the Board under 
paragraph (1)(B), the Federal Deposit Insurance Cor-
poration does not object, in writing, to such exemp-
tion or exclusion, based on a determination that the 
exemption presents an unacceptable risk to the De-
posit Insurance Fund.’’. 
(c) HOME OWNERS’ LOAN ACT.—Section 11 of the 
Home Owners’ Loan Act (12 U.S.C. 1468) is amended by 
adding at the end the following: 
‘‘(d) EXEMPTIONS.— 
‘‘(1) FEDERAL
SAVINGS
ASSOCIATIONS.—The 
Comptroller of the Currency may, by order, exempt a 
transaction of a Federal savings association from the 
requirements of this section if— 
‘‘(A) the Board and the Office of the Comp-
troller of the Currency jointly find the exemption 
to be in the public interest and consistent with 
the purposes of this section and notify the Fed-
eral Deposit Insurance Corporation of such find-
ing; and 
‘‘(B) before the end of the 60-day period be-
ginning on the date on which the Federal De-
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† HR 4173 EAS 
posit Insurance Corporation receives notice of the 
finding under subparagraph (A), the Federal De-
posit Insurance Corporation does not object, in 
writing, to the finding, based on a determination 
that the exemption presents an unacceptable risk 
to the Deposit Insurance Fund. 
‘‘(2) STATE SAVINGS ASSOCIATION.—The Federal 
Deposit Insurance Corporation may, by order, exempt 
a transaction of a State savings association from the 
requirements of this section if the Board and the Fed-
eral Deposit Insurance Corporation jointly find 
that— 
‘‘(A) the exemption is in the public interest 
and consistent with the purposes of this section; 
and 
‘‘(B) the exemption does not present an un-
acceptable risk to the Deposit Insurance Fund.’’. 
(d) EFFECTIVE DATE.—The amendments made by this 
section shall take effect 1 year after the transfer date. 
SEC. 609. ELIMINATING EXCEPTIONS FOR TRANSACTIONS 
WITH FINANCIAL SUBSIDIARIES. 
(a) AMENDMENT.—Section 23A(e) of the Federal Re-
serve Act (12 U.S.C. 371c(e)) is amended— 
(1) by striking paragraph (3); and
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† HR 4173 EAS 
(2) by redesignating paragraph (4) as para-
graph (3). 
(b) PROSPECTIVE APPLICATION OF AMENDMENT.—The 
amendments made by this section shall apply with respect 
to any covered transaction between a bank and a subsidiary 
of the bank, as those terms are defined in section 23A of 
the Federal Reserve Act (12 U.S.C. 371c), that is entered 
into on or after the date of enactment of this Act. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall take effect 1 year after the transfer date. 
SEC. 610. LENDING LIMITS APPLICABLE TO CREDIT EXPO-
SURE ON DERIVATIVE TRANSACTIONS, RE-
PURCHASE AGREEMENTS, REVERSE REPUR-
CHASE AGREEMENTS, AND SECURITIES LEND-
ING AND BORROWING TRANSACTIONS. 
(a) NATIONAL BANKS.—Section 5200(b) of the Revised 
Statutes of the United States (12 U.S.C. 84(b)) is amend-
ed— 
(1) in paragraph (1), by striking ‘‘shall include’’ 
and all that follows through the end of the paragraph 
and inserting the following: ‘‘shall include— 
‘‘(A) all direct or indirect advances of funds 
to a person made on the basis of any obligation 
of that person to repay the funds or repayable
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† HR 4173 EAS 
from specific property pledged by or on behalf of 
the person; 
‘‘(B) to the extent specified by the Comp-
troller of the Currency, any liability of a na-
tional banking association to advance funds to 
or on behalf of a person pursuant to a contrac-
tual commitment; and 
‘‘(C) any credit exposure to a person aris-
ing from a derivative transaction, repurchase 
agreement, reverse repurchase agreement, securi-
ties lending transaction, or securities borrowing 
transaction between the national banking asso-
ciation and the person;’’; 
(2) in paragraph (2), by striking the period at 
the end and inserting ‘‘; and’’; and 
(3) by adding at the end the following: 
‘‘(3) the term ‘derivative transaction’ includes 
any transaction that is a contract, agreement, swap, 
warrant, note, or option that is based, in whole or in 
part, on the value of, any interest in, or any quan-
titative measure or the occurrence of any event relat-
ing to, one or more commodities, securities, cur-
rencies, interest or other rates, indices, or other as-
sets.’’.
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† HR 4173 EAS 
(b) SAVINGS ASSOCIATIONS.—Section 5(u)(3) of the 
Home Owners’ Loan Act (12 U.S.C. 1464(u)(3)) is amended 
by striking ‘‘Director’’ each place that term appears and 
inserting ‘‘Comptroller of the Currency’’. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall take effect 1 year after the transfer date. 
SEC. 611. APPLICATION OF NATIONAL BANK LENDING LIM-
ITS TO INSURED STATE BANKS. 
(a) AMENDMENT.—Section 18 of the Federal Deposit 
Insurance Act (12 U.S.C. 1828) is amended by adding at 
the end the following: 
‘‘(y) APPLICATION OF LENDING LIMITS TO INSURED 
STATE BANKS.—Section 5200 of the Revised Statutes of the 
United States (12 U.S.C. 84) shall apply to each insured 
State bank, in the same manner and to the same extent 
as if the insured State bank were a national banking asso-
ciation.’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall take effect 1 year after the transfer date. 
SEC. 612. RESTRICTION ON CONVERSIONS OF TROUBLED 
BANKS. 
(a) CONVERSION OF A NATIONAL BANKING ASSOCIA-
TION TO A STATE BANK.—The Act entitled ‘‘An Act to pro-
vide for the conversion of national banking associations into 
and their merger or consolidation with State banks, and
459 
† HR 4173 EAS 
for other purposes.’’ (12 U.S.C. 214 et seq.) is amended by 
adding at the end the following: 
‘‘SEC. 10. PROHIBITION ON CONVERSION. 
‘‘A national banking association may not convert to 
a State bank or State savings association during any pe-
riod in which the national banking association is subject 
to a cease and desist order (or other formal enforcement 
order) issued by, or a memorandum of understanding en-
tered into with, the Comptroller of the Currency with re-
spect to a significant supervisory matter.’’. 
(b) CONVERSION OF A STATE BANK TO A NATIONAL 
BANK.—Section 5154 of the Revised Statutes of the United 
States (12 U.S.C. 35) is amended by adding at the end the 
following: ‘‘The Comptroller of the Currency may not ap-
prove the conversion of a State bank or State savings asso-
ciation to a national banking association during any pe-
riod in which the State bank or State savings association 
is subject to a cease and desist order (or other formal en-
forcement order) issued by, or a memorandum of under-
standing entered into with, a State bank supervisor or the 
appropriate Federal banking agency with respect to a sig-
nificant supervisory matter.’’. 
(c) CONVERSION OF A FEDERAL SAVINGS ASSOCIATION 
TO A NATIONAL OR STATE BANK OR STATE SAVINGS ASSO-
CIATION.—Section 5(i) of the Home Owners’ Loan Act (12
460 
† HR 4173 EAS 
U.S.C. 1464(i)) is amended by adding at the end the fol-
lowing: 
‘‘(6) LIMITATION ON CERTAIN CONVERSIONS BY 
FEDERAL SAVINGS ASSOCIATIONS.—A Federal savings 
association may not convert to a national bank or 
State bank or State savings association during any 
period in which the Federal savings association is 
subject to a cease and desist order (or other formal en-
forcement order) issued by, or a memorandum of un-
derstanding entered into with, the Office of Thrift Su-
pervision or the Comptroller of the Currency with re-
spect to a significant supervisory matter.’’. 
SEC. 613. DE NOVO BRANCHING INTO STATES. 
(a) NATIONAL BANKS.—Section 5155(g)(1)(A) of the 
Revised Statutes of the United States (12 U.S.C. 
36(g)(1)(A)) is amended to read as follows: 
‘‘(A) the law of the State in which the 
branch is located, or is to be located, would per-
mit establishment of the branch, if the national 
bank were a State bank chartered by such State; 
and’’. 
(b) STATE INSURED BANKS.—Section 18(d)(4)(A)(i) 
of the Federal Deposit Insurance Act (12 U.S.C. 
1828(d)(4)(A)(i)) is amended to read as follows:
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† HR 4173 EAS 
‘‘(i) the law of the State in which the 
branch is located, or is to be located, would 
permit establishment of the branch, if the 
bank were a State bank chartered by such 
State; and’’. 
SEC. 614. LENDING LIMITS TO INSIDERS. 
(a) EXTENSIONS OF CREDIT.—Section 22(h)(9)(D)(i) 
of the Federal Reserve Act (12 U.S.C. 375b(9)(D)(i)) is 
amended— 
(1) by striking the period at the end and insert-
ing ‘‘; or’’; 
(2) by striking ‘‘a person’’ and inserting ‘‘the 
person’’; 
(3) by striking ‘‘extends credit by making’’ and 
inserting the following: ‘‘extends credit to a person 
by— 
‘‘(I) making’’; and 
(4) by adding at the end the following: 
‘‘(II) having credit exposure to the 
person arising from a derivative trans-
action (as defined in section 5200(b) of 
the Revised Statutes of the United 
States (12 U.S.C. 84(b))), repurchase 
agreement, reverse repurchase agree-
ment, securities lending transaction, or
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† HR 4173 EAS 
securities borrowing transaction be-
tween the member bank and the per-
son.’’. 
(b) EFFECTIVE DATE.—The amendments made by this 
section shall take effect 1 year after the transfer date. 
SEC. 615. LIMITATIONS ON PURCHASES OF ASSETS FROM 
INSIDERS. 
(a) AMENDMENT TO THE FEDERAL DEPOSIT INSUR-
ANCE ACT.—Section 18 of the Federal Deposit Insurance 
Act (12 U.S.C. 1828) is amended by adding at the end the 
following: 
‘‘(z) GENERAL PROHIBITION ON SALE OF ASSETS.— 
‘‘(1) IN GENERAL.—An insured depository insti-
tution may not purchase an asset from, or sell an 
asset to, an executive officer, director, or principal 
shareholder of the insured depository institution, or 
any related interest of such person (as such terms are 
defined in section 22(h) of Federal Reserve Act), un-
less— 
‘‘(A) the transaction is on market terms; 
and 
‘‘(B) if the transaction represents more than 
10 percent of the capital stock and surplus of the 
insured depository institution, the transaction 
has been approved in advance by a majority of
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† HR 4173 EAS 
the members of the board of directors of the in-
sured depository institution who do not have an 
interest in the transaction. 
‘‘(2) RULEMAKING.—The Board of Governors of 
the Federal Reserve System may issue such rules as 
may be necessary to define terms and to carry out the 
purposes this subsection. Before proposing or adopting 
a rule under this paragraph, the Board of Governors 
of the Federal Reserve System shall consult with the 
Comptroller of the Currency and the Corporation as 
to the terms of the rule.’’. 
(b) AMENDMENTS TO THE FEDERAL RESERVE ACT.— 
Section 22(d) of the Federal Reserve Act (12 U.S.C. 375) 
is amended to read as follows: 
‘‘(d) [Reserved]’’. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall take effect on the transfer date. 
SEC. 616. REGULATIONS REGARDING CAPITAL LEVELS OF 
HOLDING COMPANIES. 
(a) CAPITAL LEVELS
OF BANK HOLDING COMPA-
NIES.—Section 5(b) of the Bank Holding Company Act of 
1956 (12 U.S.C. 1844(b)) is amended by inserting after 
‘‘regulations’’ the following: ‘‘(including regulations relat-
ing to the capital requirements of bank holding compa-
nies)’’.
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† HR 4173 EAS 
(b) CAPITAL LEVELS OF SAVINGS AND LOAN HOLDING 
COMPANIES.—Section 10(g)(1) of the Home Owners’ Loan 
Act (12 U.S.C. 1467a(g)(1)) is amended by inserting after 
‘‘orders’’ the following: ‘‘(including regulations relating to 
capital requirements for savings and loan holding compa-
nies)’’. 
(c) SOURCE OF STRENGTH.—The Federal Deposit In-
surance Act (12 U.S.C. 1811 et seq.) is amended by insert-
ing after section 38 (12 U.S.C. 1831o) the following: 
‘‘SEC. 38A. SOURCE OF STRENGTH. 
‘‘(a) HOLDING COMPANIES.—The appropriate Federal 
banking agency for a bank holding company or savings and 
loan holding company shall require the bank holding com-
pany or savings and loan holding company to serve as a 
source of financial strength for any subsidiary of the bank 
holding company or savings and loan holding company 
that is a depository institution. 
‘‘(b) OTHER COMPANIES.—If an insured depository 
institution is not the subsidiary of a bank holding company 
or savings and loan holding company, the appropriate Fed-
eral banking agency for the insured depository institution 
shall require any company that directly or indirectly con-
trols the insured depository institution to serve as a source 
of financial strength for such institution.
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† HR 4173 EAS 
‘‘(c) REPORTS.—The appropriate Federal banking 
agency for an insured depository institution described in 
subsection (b) may, from time to time, require the company, 
or a company that directly or indirectly controls the in-
sured depository institution to submit a report, under oath, 
for the purposes of— 
‘‘(1) assessing the ability of such company to 
comply with the requirement under subsection (b); 
and 
‘‘(2) enforcing the compliance of such company 
with the requirement under subsection (b). 
‘‘(d) RULES.—Not later than 1 year after the transfer 
date, as defined in section 311 of the Enhancing Financial 
Institution Safety and Soundness Act of 2010, the appro-
priate Federal banking agencies shall jointly issue final 
rules to carry out this section. 
‘‘(e) DEFINITION.—In this section, the term ‘source of 
financial strength’ means the ability of a company that di-
rectly or indirectly owns or controls an insured depository 
institution to provide financial assistance to such insured 
depository institution in the event of the financial distress 
of the insured depository institution.’’. 
(d) EFFECTIVE DATE.—The amendments made by this 
section shall take effect on the transfer date.
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† HR 4173 EAS 
SEC. 617. ELIMINATION OF ELECTIVE INVESTMENT BANK 
HOLDING COMPANY FRAMEWORK. 
(a) AMENDMENT.—Section 17 of the Securities Ex-
change Act of 1934 (15 U.S.C. 78q) is amended— 
(1) by striking subsection (i); and 
(2) by redesignating subsections (j) and (k) as 
subsections (i) and (j), respectively. 
(b) EFFECTIVE DATE.—The amendments made by this 
section shall take effect on the transfer date. 
SEC. 618. SECURITIES HOLDING COMPANIES. 
(a) DEFINITIONS.—In this section— 
(1) the term ‘‘associated person of a securities 
holding company’’ means a person directly or indi-
rectly controlling, controlled by, or under common 
control with, a securities holding company; 
(2) the term ‘‘foreign bank’’ has the same mean-
ing as in section 1(b)(7) of the International Banking 
Act of 1978 (12 U.S.C. 3101(b)(7)); 
(3) the term ‘‘insured bank’’ has the same mean-
ing as in section 3 of the Federal Deposit Insurance 
Act (12 U.S.C. 1813); 
(4) the term ‘‘securities holding company’’— 
(A) means— 
(i) a person (other than a natural per-
son) that owns or controls 1 or more brokers
467 
† HR 4173 EAS 
or dealers registered with the Commission; 
and 
(ii) the associated persons of a person 
described in clause (i); and 
(B) does not include a person that is— 
(i) a nonbank financial company su-
pervised by the Board under title I; 
(ii) an affiliate of an insured bank 
(other than an institution described in sub-
paragraphs (D), (F), or (H) of section 
2(c)(2) of the Bank Holding Company Act 
of 1956 (12 U.S.C. 1841(c)(2)) or an affil-
iate of a savings association; 
(iii) a foreign bank, foreign company, 
or company that is described in section 8(a) 
of the International Banking Act of 1978 
(12 U.S.C. 3106(a)); 
(iv) a foreign bank that controls, di-
rectly or indirectly, a corporation chartered 
under section 25A of the Federal Reserve 
Act (12 U.S.C. 611 et seq.); or 
(v) subject to comprehensive consoli-
dated supervision by a foreign regulator; 
(5) the term ‘‘supervised securities holding com-
pany’’ means a securities holding company that is su-
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† HR 4173 EAS 
pervised by the Board of Governors under this section; 
and 
(6) the terms ‘‘affiliate’’, ‘‘bank’’, ‘‘bank holding 
company’’, ‘‘company’’, ‘‘control’’, ‘‘savings associa-
tion’’, and ‘‘subsidiary’’ have the same meanings as 
in section 2 of the Bank Holding Company Act of 
1956. 
(b) SUPERVISION OF A SECURITIES HOLDING COM-
PANY NOT HAVING A BANK OR SAVINGS ASSOCIATION AF-
FILIATE.— 
(1) IN GENERAL.—A securities holding company 
that is required by a foreign regulator or provision of 
foreign law to be subject to comprehensive consoli-
dated supervision may register with the Board of 
Governors under paragraph (2) to become a super-
vised securities holding company. Any securities hold-
ing company filing such a registration shall be super-
vised in accordance with this section, and shall com-
ply with the rules and orders prescribed by the Board 
of Governors applicable to supervised securities hold-
ing companies. 
(2) REGISTRATION AS A SUPERVISED SECURI-
TIES HOLDING COMPANY.— 
(A) REGISTRATION.—A securities holding 
company that elects to be subject to comprehen-
470 
† HR 4173 EAS 
termines to be necessary or appropriate to carry 
out this section, to prevent evasions thereof, and 
to monitor compliance by the supervised securi-
ties holding company or affiliate with applicable 
provisions of law. 
(B) FORM AND CONTENTS.— 
(i) IN GENERAL.—Any record or report 
required to be made, furnished, or kept 
under this paragraph shall— 
(I) be prepared in such form and 
according to such specifications (in-
cluding certification by a registered 
public accounting firm), as the Board 
of Governors may require; and 
(II) be provided promptly to the 
Board of Governors at any time, upon 
request by the Board of Governors. 
(ii) CONTENTS.—Records and reports 
required to be made, furnished, or kept 
under this paragraph may include— 
(I) a balance sheet or income 
statement of the supervised securities 
holding company or an affiliate of a 
supervised securities holding company;
471 
† HR 4173 EAS 
(II) an assessment of the consoli-
dated capital and liquidity of the su-
pervised securities holding company; 
(III) a report by an independent 
auditor attesting to the compliance of 
the supervised securities holding com-
pany with the internal risk manage-
ment and internal control objectives of 
the supervised securities holding com-
pany; and 
(IV) a report concerning the ex-
tent to which the supervised securities 
holding company or affiliate has com-
plied with the provisions of this section 
and any regulations prescribed and or-
ders issued under this section. 
(2) USE OF EXISTING REPORTS.— 
(A) IN GENERAL.—The Board of Governors 
shall, to the fullest extent possible, accept reports 
in fulfillment of the requirements of this para-
graph that a supervised securities holding com-
pany or an affiliate of a supervised securities 
holding company has been required to provide to 
another regulatory agency or a self-regulatory 
organization.
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† HR 4173 EAS 
(B) AVAILABILITY.—A supervised securities 
holding company or an affiliate of a supervised 
securities holding company shall promptly pro-
vide to the Board of Governors, at the request of 
the Board of Governors, any report described in 
subparagraph (A), as permitted by law. 
(3) EXAMINATION AUTHORITY.— 
(A) FOCUS OF EXAMINATION AUTHORITY.— 
The Board of Governors may make examinations 
of any supervised securities holding company 
and any affiliate of a supervised securities hold-
ing company to carry out this subsection, to pre-
vent evasions thereof, and to monitor compliance 
by the supervised securities holding company or 
affiliate with applicable provisions of law. 
(B) DEFERENCE
TO
OTHER
EXAMINA-
TIONS.—For purposes of this subparagraph, the 
Board of Governors shall, to the fullest extent 
possible, use the reports of examination made by 
other appropriate Federal or State regulatory 
authorities with respect to any functionally regu-
lated subsidiary or any institution described in 
subparagraph (D), (F), or (H) of section 2(c)(2) 
of the Bank Holding Company Act of 1956 (12 
U.S.C. 1841(c)(2)).
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† HR 4173 EAS 
(d) CAPITAL AND RISK MANAGEMENT.— 
(1) IN GENERAL.—The Board of Governors shall, 
by regulation or order, prescribe capital adequacy 
and other risk management standards for supervised 
securities holding companies that are appropriate to 
protect the safety and soundness of the supervised se-
curities holding companies and address the risks 
posed to financial stability by supervised securities 
holding companies. 
(2) DIFFERENTIATION.—In imposing standards 
under this subsection, the Board of Governors may 
differentiate among supervised securities holding com-
panies on an individual basis, or by category, taking 
into consideration the requirements under paragraph 
(3). 
(3) CONTENT.—Any standards imposed on a su-
pervised securities holding company under this sub-
section shall take into account— 
(A) the differences among types of business 
activities carried out by the supervised securities 
holding company; 
(B) the amount and nature of the financial 
assets of the supervised securities holding com-
pany;
474 
† HR 4173 EAS 
(C) the amount and nature of the liabilities 
of the supervised securities holding company, in-
cluding the degree of reliance on short-term fund-
ing; 
(D) the extent and nature of the off-balance 
sheet exposures of the supervised securities hold-
ing company; 
(E) the extent and nature of the trans-
actions and relationships of the supervised secu-
rities holding company with other financial com-
panies; 
(F) the importance of the supervised securi-
ties holding company as a source of credit for 
households, businesses, and State and local gov-
ernments, and as a source of liquidity for the fi-
nancial system; and 
(G) the nature, scope, and mix of the activi-
ties of the supervised securities holding company. 
(4) NOTICE.—A capital requirement imposed 
under this subsection may not take effect earlier than 
180 days after the date on which a supervised securi-
ties holding company is provided notice of the capital 
requirement.
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† HR 4173 EAS 
(e) EXCEPTION FOR BANKS.—No bank shall be subject 
to any of the requirements set forth in subsections (c) and 
(d). 
(f) OTHER PROVISIONS OF LAW APPLICABLE TO SU-
PERVISED SECURITIES HOLDING COMPANIES.— 
(1) FEDERAL DEPOSIT INSURANCE ACT.—Sub-
sections (b), (c) through (s), and (u) of section 8 of 
the Federal Deposit Insurance Act (12 U.S.C. 1818) 
shall apply to any supervised securities holding com-
pany, and to any subsidiary (other than a bank or 
an institution described in subparagraph (D), (F), or 
(H) of section 2(c)(2) of the Bank Holding Company 
Act of 1956 (12 U.S.C. 1841(c)(2))) of a supervised 
securities holding company, in the same manner as 
such subsections apply to a bank holding company for 
which the Board of Governors is the appropriate Fed-
eral banking agency. For purposes of applying such 
subsections to a supervised securities holding com-
pany or a subsidiary (other than a bank or an insti-
tution described in subparagraph (D), (F), or (H) of 
section 2(c)(2) of the Bank Holding Company Act of 
1956 (12 U.S.C. 1841(c)(2))) of a supervised securi-
ties holding company, the Board of Governors shall be 
deemed the appropriate Federal banking agency for
476 
† HR 4173 EAS 
the supervised securities holding company or sub-
sidiary. 
(2) BANK HOLDING COMPANY ACT OF 1956.—Ex-
cept as the Board of Governors may otherwise provide 
by regulation or order, a supervised securities holding 
company shall be subject to the provisions of the Bank 
Holding Company Act of 1956 (12 U.S.C. 1841 et 
seq.) in the same manner and to the same extent a 
bank holding company is subject to such provisions, 
except that a supervised securities holding company 
may not, by reason of this paragraph, be deemed to 
be a bank holding company for purposes of section 4 
of the Bank Holding Company Act of 1956 (12 
U.S.C. 1843). 
SEC. 619. RESTRICTIONS ON CAPITAL MARKET ACTIVITY BY 
BANKS AND BANK HOLDING COMPANIES. 
(a) DEFINITIONS.—In this section— 
(1) the terms ‘‘hedge fund’’ and ‘‘private equity 
fund’’ mean a company or other entity that is exempt 
from registration as an investment company pursu-
ant to section 3(c)(1) or 3(c)(7) of the Investment 
Company Act of 1940 (15 U.S.C. 80a–3(c)(1) or 80a– 
3(c)(7)), or a similar fund, as jointly determined by 
the appropriate Federal banking agencies; 
(2) the term ‘‘proprietary trading’’—
477 
† HR 4173 EAS 
(A) means purchasing or selling, or other-
wise acquiring or disposing of, stocks, bonds, op-
tions, commodities, derivatives, or other finan-
cial instruments by an insured depository insti-
tution, a company that controls, directly or indi-
rectly, an insured depository institution or is 
treated as a bank holding company for purposes 
of the Bank Holding Company Act of 1956 (12 
U.S.C. 1841 et seq.), and any subsidiary of such 
institution or company, for the trading book (or 
such other portfolio as the Federal banking agen-
cies may determine) of such institution, com-
pany, or subsidiary; and 
(B) subject to such restrictions as the Fed-
eral banking agencies may determine, does not 
include purchasing or selling, or otherwise ac-
quiring or disposing of, stocks, bonds, options, 
commodities, derivatives, or other financial in-
struments on behalf of a customer, as part of 
market making activities, or otherwise in connec-
tion with or in facilitation of customer relation-
ships, including risk-mitigating hedging activi-
ties related to such a purchase, sale, acquisition, 
or disposal; and
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† HR 4173 EAS 
(3) the term ‘‘sponsoring’’, when used with re-
spect to a hedge fund or private equity fund, means— 
(A) serving as a general partner, managing 
member, or trustee of the fund; 
(B) in any manner selecting or controlling 
(or having employees, officers, directors, or 
agents who constitute) a majority of the direc-
tors, trustees, or management of the fund; or 
(C) sharing with the fund, for corporate, 
marketing, promotional, or other purposes, the 
same name or a variation of the same name. 
(b) PROHIBITION ON PROPRIETARY TRADING.— 
(1) IN GENERAL.—Subject to the recommenda-
tions and modifications of the Council under sub-
section (g), and except as provided in paragraph (2) 
or (3), the appropriate Federal banking agencies 
shall, through a rulemaking under subsection (g), 
jointly prohibit proprietary trading by an insured de-
pository institution, a company that controls, directly 
or indirectly, an insured depository institution or is 
treated as a bank holding company for purposes of 
the Bank Holding Company Act of 1956 (12 U.S.C. 
1841 et seq.), and any subsidiary of such institution 
or company. 
(2) EXCEPTED OBLIGATIONS.—
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† HR 4173 EAS 
(A) IN GENERAL.—The prohibition under 
this subsection shall not apply with respect to an 
investment that is otherwise authorized by Fed-
eral law in— 
(i) obligations of the United States or 
any agency of the United States, including 
obligations fully guaranteed as to principal 
and interest by the United States or an 
agency of the United States; 
(ii) 
obligations, 
participations, 
or 
other instruments of, or issued by, the Gov-
ernment National Mortgage Association, the 
Federal National Mortgage Association, or 
the Federal Home Loan Mortgage Corpora-
tion, including obligations fully guaranteed 
as to principal and interest by such enti-
ties; and 
(iii) obligations of any State or any 
political subdivision of a State. 
(B) CONDITIONS.—The appropriate Federal 
banking agencies may impose conditions on the 
conduct of investments described in subpara-
graph (A). 
(C) RULE OF CONSTRUCTION.—Nothing in 
subparagraph (A) may be construed to grant
480 
† HR 4173 EAS 
any authority to any person that is not other-
wise provided in Federal law. 
(3) FOREIGN ACTIVITIES.—An investment or ac-
tivity conducted by a company pursuant to para-
graph (9) or (13) of section 4(c) of the Bank Holding 
Company Act of 1956 (12 U.S.C. 1843(c)) solely out-
side of the United States shall not be subject to the 
prohibition under paragraph (1), provided that the 
company is not directly or indirectly controlled by a 
company that is organized under the laws of the 
United States or of a State. 
(c) PROHIBITION ON SPONSORING AND INVESTING IN 
HEDGE FUNDS AND PRIVATE EQUITY FUNDS.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), and subject to the recommendations and 
modifications of the Council under subsection (g), the 
appropriate Federal banking agencies shall, through a 
rulemaking under subsection (g), jointly prohibit an 
insured depository institution, a company that con-
trols, directly or indirectly, an insured depository in-
stitution or is treated as a bank holding company for 
purposes of the Bank Holding Company Act of 1956 
(12 U.S.C. 1841 et seq.), or any subsidiary of such 
institution or company, from sponsoring or investing 
in a hedge fund or a private equity fund.
481 
† HR 4173 EAS 
(2) APPLICATION
TO
FOREIGN
ACTIVITIES
OF 
FOREIGN
FIRMS.—An investment or activity con-
ducted by a company pursuant to paragraph (9) or 
(13) of section 4(c) of the Bank Holding Company 
Act of 1956 (12 U.S.C. 1843(c)) solely outside of the 
United States shall not be subject to the prohibitions 
and restrictions under paragraph (1), provided that 
the company is not directly or indirectly controlled 
by a company that is organized under the laws of the 
United States or of a State. 
(d) INVESTMENTS IN SMALL BUSINESS INVESTMENT 
COMPANIES AND INVESTMENTS DESIGNED TO PROMOTE 
THE PUBLIC WELFARE.— 
(1) IN GENERAL.—A prohibition imposed by the 
appropriate Federal banking agencies under sub-
section (c) shall not apply with respect an investment 
otherwise authorized under Federal law that is— 
(A) an investment in a small business in-
vestment company, as that term is defined in 
section 103 of the Small Business Investment Act 
of 1958 (15 U.S.C. 662); or 
(B) designed primarily to promote the pub-
lic welfare, as provided in the 11th paragraph of 
section 5136 of the Revised Statutes (12 U.S.C. 
24).
483 
† HR 4173 EAS 
ment manager or investment adviser to a hedge fund 
or private equity fund shall be subject to section 23B 
of the Federal Reserve Act (12 U.S.C. 371c–1) as if 
such institution, company, or subsidiary were a mem-
ber bank and such hedge fund or private equity fund 
were an affiliate. 
(f) CAPITAL
AND QUANTITATIVE LIMITATIONS
FOR 
CERTAIN NONBANK FINANCIAL COMPANIES.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), and subject to the recommendations and 
modifications of the Council under subsection (g), the 
Board of Governors shall adopt rules imposing addi-
tional capital requirements and specifying additional 
quantitative limits for nonbank financial companies 
supervised by the Board of Governors under section 
113 that engage in proprietary trading or sponsoring 
and investing in hedge funds and private equity 
funds. 
(2) EXCEPTIONS.—The rules under this sub-
section shall not apply with respect to the trading of 
an investment that is otherwise authorized by Federal 
law— 
(A) in obligations of the United States or 
any agency of the United States, including obli-
gations fully guaranteed as to principal and in-
484 
† HR 4173 EAS 
terest by the United States or an agency of the 
United States; 
(B) in obligations, participations, or other 
instruments of, or issued by, the Government Na-
tional Mortgage Association, the Federal Na-
tional Mortgage Association, or the Federal 
Home Loan Mortgage Corporation, including ob-
ligations fully guaranteed as to principal and 
interest by such entities; 
(C) in obligations of any State or any polit-
ical subdivision of a State; 
(D) in a small business investment com-
pany, as that term is defined in section 103 of 
the Small Business Investment Act of 1958 (15 
U.S.C. 662); or 
(E) that is designed primarily to promote 
the public welfare, as provided in the 11th para-
graph of section 5136 of the Revised Statutes (12 
U.S.C. 24). 
(g) COUNCIL STUDY AND RULEMAKING.— 
(1) STUDY AND RECOMMENDATIONS.—Not later 
than 6 months after the date of enactment of this Act, 
the Council— 
(A) shall complete a study of the definitions 
under subsection (a) and the other provisions
485 
† HR 4173 EAS 
under subsections (b) through (f), to assess the 
extent to which the definitions under subsection 
(a) and the implementation of subsections (a) 
through (f) would— 
(i) promote and enhance the safety and 
soundness of depository institutions and the 
affiliates of depository institutions; 
(ii) protect taxpayers and enhance fi-
nancial stability by minimizing the risk 
that depository institutions and the affili-
ates of depository institutions will engage 
in unsafe and unsound activities; 
(iii) limit the inappropriate transfer of 
Federal subsidies from institutions that ben-
efit from deposit insurance and liquidity fa-
cilities of the Federal Government to un-
regulated entities; 
(iv) reduce inappropriate conflicts of 
interest between the self-interest of deposi-
tory institutions, affiliates of depository in-
stitutions, and financial companies super-
vised by the Board, and the interests of the 
customers of such institutions and compa-
nies;
486 
† HR 4173 EAS 
(v) raise the cost of credit or other fi-
nancial services, reduce the availability of 
credit or other financial services, or impose 
other costs on households and businesses in 
the United States; 
(vi) limit activities that have caused 
undue risk or loss in depository institu-
tions, affiliates of depository institutions, 
and financial companies supervised by the 
Board of Governors, or that might reason-
ably be expected to create undue risk or loss 
in such institutions, affiliates, and compa-
nies; and 
(vii) appropriately accommodates the 
business of insurance within an insurance 
company subject to regulation in accordance 
with State insurance company investment 
laws; 
(B) shall make recommendations regarding 
the definitions under subsection (a) and the im-
plementation of other provisions under sub-
sections (b) through (f), including any modifica-
tions to the definitions, prohibitions, require-
ments, and limitations contained therein that the
487 
† HR 4173 EAS 
Council determines would more effectively imple-
ment the purposes of this section; and 
(C) may make recommendations for prohib-
iting the conduct of the activities described in 
subsections (b) and (c) above a specific threshold 
amount and imposing additional capital re-
quirements on activities conducted below such 
threshold amount. 
(2) RULEMAKING.—Not earlier than the date of 
completion of the study required under paragraph 
(1), and not later than 9 months after the date of 
completion of such study— 
(A) the appropriate Federal banking agen-
cies shall jointly issue final regulations imple-
menting subsections (b) through (e), which shall 
reflect any recommendations or modifications 
made by the Council pursuant to paragraph 
(1)(B); and 
(B) the Board of Governors shall issue final 
regulations implementing subsection (f), which 
shall reflect any recommendations or modifica-
tions made by the Council pursuant to para-
graph (1)(B). 
(h) TRANSITION.—
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† HR 4173 EAS 
(1) IN GENERAL.—The final regulations issued 
by the appropriate Federal banking agencies and the 
Board of Governors under subsection (g)(2) shall pro-
vide that, effective 2 years after the date on which 
such final regulations are issued, no insured deposi-
tory institution, company that controls, directly or 
indirectly, an insured depository institution, com-
pany that is treated as a bank holding company for 
purposes of the Bank Holding Company Act of 1956 
(12 U.S.C. 1841 et seq.), or subsidiary of such institu-
tion or company, may retain any investment or rela-
tionship prohibited under such regulations. 
(2) EXTENSION.— 
(A) IN GENERAL.—The appropriate Federal 
banking agency for an insured depository insti-
tution or a company described in paragraph (1) 
may, upon the application of any such company, 
extend the 2-year period under paragraph (1) 
with respect to such company, if the appropriate 
Federal banking agency determines that an ex-
tension would not be detrimental to the public 
interest. 
(B) TIME PERIOD FOR EXTENSION.—An ex-
tension granted under subparagraph (A) may 
not exceed—
489 
† HR 4173 EAS 
(i) 1 year for each determination made 
by the appropriate Federal banking agency 
under subparagraph (A); and 
(ii) a total of 3 years with respect to 
any 1 company. 
SEC. 620. CONCENTRATION LIMITS ON LARGE FINANCIAL 
FIRMS. 
The Bank Holding Company Act of 1956 (12 U.S.C. 
1841 et seq.) is amended by adding at the end the following: 
‘‘SEC. 13. CONCENTRATION LIMITS ON LARGE FINANCIAL 
FIRMS. 
‘‘(a) DEFINITIONS.—In this section— 
‘‘(1) the term ‘Council’ means the Financial Sta-
bility Oversight Council; 
‘‘(2) the term ‘financial company’ means— 
‘‘(A) an insured depository institution; 
‘‘(B) a bank holding company; 
‘‘(C) a savings and loan holding company; 
‘‘(D) a company that controls an insured 
depository institution; 
‘‘(E) a nonbank financial company super-
vised by the Board under title I of the Restoring 
American Financial Stability Act of 2010; and
490 
† HR 4173 EAS 
‘‘(F) a foreign bank or company that is 
treated as a bank holding company for purposes 
of this Act; and 
‘‘(3) the term ‘liabilities’ means— 
‘‘(A) with respect to a United States finan-
cial company— 
‘‘(i) the total risk-weighted assets of the 
financial company, as determined under the 
risk-based capital rules applicable to bank 
holding companies, as adjusted to reflect ex-
posures that are deducted from regulatory 
capital; less 
‘‘(ii) the total regulatory capital of the 
financial company under the risk-based 
capital rules applicable to bank holding 
companies; 
‘‘(B) with respect to a foreign-based finan-
cial company— 
‘‘(i) the total risk-weighted assets of the 
United States operations of the financial 
company, as determined under the applica-
ble risk-based capital rules, as adjusted to 
reflect exposures that are deducted from reg-
ulatory capital; less
491 
† HR 4173 EAS 
‘‘(ii) the total regulatory capital of the 
United States operations of the financial 
company, as determined under the applica-
ble risk-based capital rules; and 
‘‘(C) with respect to an insurance company 
or other nonbank financial company supervised 
by the Board, such assets of the company as the 
Board shall specify by rule, in order to provide 
for consistent and equitable treatment of such 
companies. 
‘‘(b) CONCENTRATION LIMIT.—Subject to the rec-
ommendations by the Council under subsection (e), a finan-
cial company may not merge or consolidate with, acquire 
all or substantially all of the assets of, or otherwise acquire 
control of, another company, if the total consolidated liabil-
ities of the acquiring financial company upon consumma-
tion of the transaction would exceed 10 percent of the aggre-
gate consolidated liabilities of all financial companies at 
the end of the calendar year preceding the transaction. 
‘‘(c) EXCEPTION TO CONCENTRATION LIMIT.—With the 
prior written consent of the Board, the concentration limit 
under subsection (b) shall not apply to an acquisition— 
‘‘(1) of a bank in default or in danger of default; 
‘‘(2) with respect to which assistance is provided 
by the Federal Deposit Insurance Corporation under
492 
† HR 4173 EAS 
section 13(c) of the Federal Deposit Insurance Act (12 
U.S.C. 1823(c)); or 
‘‘(3) that would result only in a de minimis in-
crease in the liabilities of the financial company. 
‘‘(d) RULEMAKING AND GUIDANCE.—The Board shall 
issue regulations implementing this section in accordance 
with the recommendations of the Council under subsection 
(e), including the definition of terms, as necessary. The 
Board may issue interpretations or guidance regarding the 
application of this section to an individual financial com-
pany or to financial companies in general. 
‘‘(e) COUNCIL STUDY AND RULEMAKING.— 
‘‘(1) STUDY AND RECOMMENDATIONS.—Not later 
than 6 months after the date of enactment of this sec-
tion, the Council shall— 
‘‘(A) complete a study of the extent to which 
the concentration limit under this section would 
affect financial stability, moral hazard in the fi-
nancial system, the efficiency and competitive-
ness of United States financial firms and finan-
cial markets, and the cost and availability of 
credit and other financial services to households 
and businesses in the United States; and 
‘‘(B) make recommendations regarding any 
modifications to the concentration limit that the
493 
† HR 4173 EAS 
Council determines would more effectively imple-
ment this section. 
‘‘(2) RULEMAKING.—Not later than 9 months 
after the date of completion of the study under para-
graph (1), and notwithstanding subsections (b) and 
(d), the Board shall issue final regulations imple-
menting this section, which shall reflect any rec-
ommendations by the Council under paragraph 
(1)(B).’’. 
TITLE VII—WALL STREET TRANS-
PARENCY 
AND 
ACCOUNT-
ABILITY 
SEC. 701. SHORT TITLE. 
This title may be cited as the ‘‘Wall Street Trans-
parency and Accountability Act of 2010’’. 
Subtitle A—Regulation of Over-the- 
Counter Swaps Markets 
PART I—REGULATORY AUTHORITY 
SEC. 711. DEFINITIONS. 
In this subtitle, the terms ‘‘prudential regulator’’, 
‘‘swap’’, ‘‘swap dealer’’, ‘‘major swap participant’’, ‘‘swap 
data repository’’, ‘‘associated person of a swap dealer or 
major swap participant’’, ‘‘eligible contract participant’’, 
‘‘swap execution facility’’, ‘‘security-based swap’’, ‘‘secu-
rity-based swap dealer’’, ‘‘major security-based swap par-
494 
† HR 4173 EAS 
ticipant’’, ‘‘swap data repository’’, and ‘‘associated person 
of a security-based swap dealer or major security-based 
swap participant’’ have the meanings given the terms in 
section 1a of the Commodity Exchange Act (7 U.S.C. 1a). 
SEC. 712. REVIEW OF REGULATORY AUTHORITY. 
(a) REGULATORY AUTHORITY.— 
(1) IN GENERAL.—Except as provided in para-
graphs (4) and (8), the Commodity Futures Trading 
Commission and the Securities and Exchange Com-
mission shall each prescribe such regulations as may 
be necessary to carry out the purposes of this title. 
(2) COORDINATION, CONSISTENCY, AND
COM-
PARABILITY.—Both 
Commissions 
required 
under 
paragraph (1) to prescribe regulations shall consult 
and coordinate with each other for the purposes of as-
suring, to the extent possible, that the regulations pre-
scribed by each such Commission are consistent and 
comparable with the regulations prescribed by the 
other. 
(3) PROCEDURES AND DEADLINE.—Such regula-
tions shall be prescribed in accordance with applica-
ble requirements of title 5, United States Code, and, 
shall be issued in final form not later than 180 days 
after the date of enactment of this Act.
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† HR 4173 EAS 
(4) APPLICABILITY.—The requirements of para-
graph (1) shall not apply to an order issued— 
(A) in connection with or arising from a 
violation or potential violation of any provision 
of the Commodity Exchange Act (7 U.S.C. 1 et 
seq.); 
(B) in connection with or arising from a 
violation or potential violation of any provision 
of the securities laws; or 
(C) in any proceeding that is conducted on 
the record in accordance with sections 556 and 
557 of title 5, United States Code. 
(5) EFFECT.—Nothing in this subsection author-
izes any consultation or procedure for consultation 
that is not consistent with the requirements of sub-
chapter II of chapter 5, and chapter 7, of title 5, 
United States Code (commonly known as the ‘‘Admin-
istrative Procedure Act’’). 
(6) RULES; ORDERS.—In developing and pro-
mulgating rules or orders pursuant to this subsection, 
each Commission shall consider the views of the pru-
dential regulators. 
(7) TREATMENT OF SIMILAR PRODUCTS AND EN-
TITIES.—
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† HR 4173 EAS 
(A) IN GENERAL.—In adopting rules and 
orders under this subsection, the Commodity Fu-
tures Trading Commission and the Securities 
and Exchange Commission shall treat function-
ally or economically similar products or entities 
described in paragraphs (1) and (2) in a similar 
manner. 
(B) EFFECT.—Nothing in this subtitle re-
quires the Commodity Futures Trading Commis-
sion or the Securities and Exchange Commission 
to adopt joint rules or orders that treat function-
ally or economically similar products or entities 
described in paragraphs (1) and (2) in an iden-
tical manner. 
(8) MIXED
SWAPS.—The Commodity Futures 
Trading Commission and the Securities and Ex-
change Commission shall jointly prescribe such regu-
lations regarding mixed swaps, as described in section 
1a(47)(D) of the Commodity Exchange Act (7 U.S.C. 
1a(47)(D)) and in section (68)(D) of the Securities 
Exchange Act of 1934 (15 U.S.C. (68)(D)), as may be 
necessary to carry out the purposes of this title. 
(b) LIMITATION.— 
(1) COMMODITY
FUTURES
TRADING
COMMIS-
SION.—Nothing in this title, unless specifically pro-
497 
† HR 4173 EAS 
vided, confers jurisdiction on the Commodity Futures 
Trading Commission to issue a rule, regulation, or 
order providing for oversight or regulation of— 
(A) security-based swaps; or 
(B) with regard to its activities or functions 
concerning security-based swaps— 
(i) security-based swap dealers; 
(ii) major security-based swap partici-
pants; 
(iii) security-based swap data reposi-
tories; 
(iv) persons associated with a security- 
based swap dealer or major security-based 
swap participant; 
(v) eligible contract participants with 
respect to security-based swaps; or 
(vi) swap execution facilities with re-
spect to security-based swaps. 
(2) SECURITIES AND EXCHANGE COMMISSION.— 
Nothing in this title, unless specifically provided, con-
fers jurisdiction on the Securities and Exchange Com-
mission or State securities regulators to issue a rule, 
regulation, or order providing for oversight or regula-
tion of— 
(A) swaps; or