I
103D CONGRESS
1ST SESSION
H. R. 256
To amend the Bank Holding Company Act of 1956.
IN THE HOUSE OF REPRESENTATIVES
JANUARY 5, 1993
Mr. NEAL of North Carolina introduced the following bill; which was referred
to the Committee on Banking, Finance and Urban Affairs
JULY 26, 1993
Additional sponsor: Mr. VALENTINE
A BILL
To amend the Bank Holding Company Act of 1956.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Bank Efficiency Act’’.
SEC. 2. PURPOSES.
The purposes of this Act are—
(1) to facilitate the efficient operation of banks
that are subsidiaries of multistate bank holding com-
panies;
(2) to enhance the interstate delivery of bank-
ing services to both consumers and businesses; and
(3) to strengthen generally the operation of the
banking system.
SEC. 3. AMENDMENTS TO THE BANK HOLDING COMPANY
ACT.
(a) DEFINITIONS.—Section 2 of the Bank Holding
Company Act of 1956 (12 U.S.C. 1841) is amended by
adding at the end the following new subsection:
‘‘(n) APPROPRIATE FEDERAL BANKING AGENCY.—
For purposes of this Act, the term ‘appropriate Federal
banking agency’ shall have the same meaning as such term
is given in section 3(q) of the Federal Deposit Insurance
Act.’’.
(b) INTERSTATE BANKING.—Section 3(d) of the
Bank Holding Company Act of 1956 (12 U.S.C. 1842(d))
is amended—
(1) by striking ‘‘(d)’’ and inserting the follow-
ing:
‘‘(d) LIMITATION BY STATE BOUNDARIES.—
‘‘(1) IN GENERAL.—’’; and
(2) by adding at the end the following new
paragraph:
‘‘(2) INTERSTATE COMBINATION.—
‘‘(A) A bank holding company having sub-
sidiary banks located in more than one State
may combine two or more of such banks into a
single bank by means of merger, consolidation,
or other transaction.
‘‘(B) Nothing in this paragraph shall be
deemed to authorize—
‘‘(i) a national bank to operate
branches at locations in a State unless a
national bank having offices only in such
State could operate branches at such loca-
tions;
‘‘(ii) a State-chartered bank to oper-
ate branches at locations in a State unless
a State-chartered bank having branches
only in such State could operate branches
at such locations; or
‘‘(iii) a State-chartered bank to oper-
ate branches at locations outside its char-
tering State in contravention of such char-
tering State’s laws.
‘‘(C) This paragraph does not affect any
other requirement for regulatory approval or
any other procedures that are applicable under
Federal or State law to a combination author-
ized by subparagraph (A).
‘‘(D) A bank resulting from a combination
authorized by subparagraph (A) may retain and
operate all existing main offices and branches
in each bank involved in such combination and
in existence at the time of such combination.
‘‘(E) A national bank resulting from a
combination authorized under subparagraph
(A) may establish additional branches in any
State in which it has branches to the same ex-
tent and same manner that a national bank
having branches only in such State, may estab-
lish branches in such State.
‘‘(F) A national bank resulting from a
combination authorized by subparagraph (A)
shall be entitled to exercise at each of its
branches, all powers and privileges conferred by
Federal law. To the extent that Federal law ref-
erences State law, the applicable State law for
each branch shall be the law of the State in
which the branch is located, except that for
purposes of section 5197 of the Revised Stat-
utes, the appropriate State law shall be the law
of the State in which the main office named in
the bank’s organization certificate is located.
‘‘(G) A State-chartered bank resulting
from a combination authorized under subpara-
graph (A) may, subject to the approval of the
appropriate State regulatory authority, estab-
lish additional branches in any State in which
it has branches, to the extent and in the same
manner as a State bank chartered in such State
and having branches only in such State. For
purposes of this subparagraph, the appropriate
State regulatory authority is solely the State
bank supervisor for the State in which the
branch is proposed to be established.
‘‘(H) A State-chartered bank resulting
from a combination authorized by subparagraph
(A) shall be entitled to exercise at each of its
branches, all powers and privileges conferred by
the law of its chartering State and Federal law.
However, a branch of such bank located in a
State other than the chartering State of the
bank, may not exercise any power or privilege
that is not permitted under the laws of the
State in which the branch is located, for a
branch located within such State of a bank
chartered by such State. The State bank super-
visor of the State in which the bank is char-
tered shall have authority to determine whether
an activity of a branch is permissible as a mat-
ter of State law. If a branch is located in a
State other than the chartering State, the State
bank regulator for the State in which the
branch is located may independently determine
whether an activity of the branch is permissible
under the law of such State.
‘‘(I) A State-chartered bank resulting from
a combination authorized by subparagraph (A)
shall be subject to State supervision only by the
State bank supervisor for the State in which
the bank is chartered. The State bank super-
visor for the State in which a branch is located
may enter into a cooperative agreement with
the supervisor for the chartering State to facili-
tate supervision of the bank and its branches.
Nothing in this subparagraph shall affect the
jurisdiction or authority of the appropriate Fed-
eral banking agency to supervise or examine a
State chartered bank and all of its branches.
‘‘(J) A bank may not participate in a com-
bination otherwise authorized by subparagraph
(A) if, as of the date of the filing with the ap-
propriate Federal banking agency of an applica-
tion for approval of such combination, the State
in which such bank is located has a statute, en-
acted within 2 years following the effective date
of this paragraph, that provides by express lan-
guage and not merely by implication that no
bank located in such State may combine with
any other bank pursuant to the authority con-
ferred by subparagraph (A).
‘‘(K) If a bank resulting from a combina-
tion authorized by subparagraph (A) ceases to
be a subsidiary of a bank holding company, it
shall, within 2 years after the date on which it
is no longer a subsidiary of a bank holding com-
pany, no longer be entitled to the benefits of
this paragraph, and shall comply with all provi-
sions of Federal or State law restricting the ge-
ographic location of its branches. The appro-
priate Federal banking agency may, upon appli-
cation by a bank, extend the 2-year period de-
scribed in this subparagraph, for not more than
one year at a time, if such extension would not
be detrimental to the public interest. No such