I 
111TH CONGRESS 
2D SESSION 
H. R. 5823 
To establish a covered bond regulatory oversight program, and for other 
purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 22, 2010 
Mr. GARRETT of New Jersey (for himself, Mr. KANJORSKI, and Mr. BACHUS) 
introduced the following bill; which was referred to the Committee on Fi-
nancial Services 
A BILL 
To establish a covered bond regulatory oversight program, 
and for other purposes. 
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 ‘‘United States Covered 
Bond Act of 2010’’. 
SEC. 2. DEFINITIONS. 
For purposes of this Act, the following definitions 
shall apply: 
(1) ANCILLARY
ASSET.—The term ‘‘ancillary 
asset’’ means— 
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(A) any interest rate or currency swap as-
sociated with an eligible asset, substitute asset, 
or other asset in a cover pool; 
(B) any credit enhancement or liquidity ar-
rangement associated with an eligible asset, 
substitute asset, or other asset in a cover pool; 
(C) any guarantee, letter-of-credit right, or 
other secondary obligation that supports any 
payment or performance on an eligible asset, 
substitute asset, or other asset in a cover pool; 
and 
(D) any proceeds of, or other property in-
cident to, an eligible asset, substitute asset, or 
other asset in a cover pool. 
(2) CORPORATION.—The term ‘‘Corporation’’ 
means the Federal Deposit Insurance Corporation. 
(3) COVER
POOL.—The term ‘‘cover pool’’ 
means a dynamic pool of assets that is comprised 
of— 
(A) eligible assets from a single eligible 
asset class; and 
(B) any substitute assets or ancillary as-
sets. 
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(4) COVERED
BOND.—The term ‘‘covered 
bond’’ means any senior recourse debt obligation of 
an eligible issuer that— 
(A) has an original term to maturity of not 
less than 1 year; 
(B) is secured by a perfected security in-
terest in a cover pool that is owned directly or 
indirectly by the issuer of the obligation; 
(C) is issued under a covered bond pro-
gram that has been approved by the covered 
bond regulator and is identified in a register of 
covered bonds maintained by the covered bond 
regulator; and 
(D) is not a deposit. 
(5) COVERED
BOND
PROGRAM.—The term 
‘‘covered bond program’’ means any program of an 
eligible issuer under which 1 or more series or 
tranches of covered bonds may be issued. 
(6) COVERED
BOND
REGULATOR.—The term 
‘‘covered bond regulator’’ means the Comptroller of 
the Currency. 
(7) ELIGIBLE
ASSET.—The term ‘‘eligible 
asset’’ means— 
(A) in the case of the residential mortgage 
asset class— 
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(i) any first-lien mortgage loan that is 
secured by 1-to-4 family residential prop-
erty and that is in compliance with any 
rule or supervisory guidance of a Federal 
agency that is applicable to the loan at the 
time of loan origination; 
(ii) any mortgage loan insured under 
the National Housing Act (12 U.S.C. 1701 
et seq.), or any loan guaranteed, insured, 
or made under chapter 37 of title 38, 
United States Code; and 
(iii) rural housing loans; 
(B) in the case of the home equity asset 
class, any home equity loan that is secured by 
1-to-4 family residential property and that is in 
compliance with any rule or supervisory guid-
ance of a Federal agency that is applicable to 
the loan at the time of loan origination; 
(C) in the case of the commercial mortgage 
asset class, any commercial mortgage loan (in-
cluding any multifamily mortgage loan) that is 
in compliance with any rule or supervisory guid-
ance of a Federal agency that is applicable to 
the loan at the time of loan origination; 
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(D) in the case of the public sector asset 
class— 
(i) any security issued by a State or 
municipality; 
(ii) any loan made to a State or mu-
nicipality; and 
(iii) any loan, security, or other obli-
gation that is insured or guaranteed, in 
full or substantially in full, by the full faith 
and credit of the United States Govern-
ment (whether or not such loan, security, 
or other obligation is also part of another 
eligible asset class); 
(E) in the case of the auto asset class, any 
auto loan or lease that is in compliance with 
any rule or supervisory guidance of a Federal 
agency that is applicable to the loan or lease at 
the time of loan or lease origination; 
(F) in the case of the student loan asset 
class, any student loan (whether guaranteed or 
nonguaranteed) that is in compliance with any 
rule or supervisory guidance of a Federal agen-
cy that is applicable to the loan at the time of 
loan origination; 
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(G) in the case of the credit or charge card 
asset class, any extension of credit to a person 
under an open-end credit plan that is in compli-
ance with any rule or supervisory guidance of a 
Federal agency that is applicable to the exten-
sion of credit at the time the extension is made; 
(H) in the case of the small business asset 
class, any loan made or guaranteed under a 
program of the Small Business Administration; 
and 
(I) in the case of any other eligible asset 
class, any asset designated by the covered bond 
regulator, by rule and in consultation with the 
applicable primary financial regulatory agen-
cies, as an eligible asset for purposes of such 
class. 
(8) ELIGIBLE ASSET CLASS.—The term ‘‘eligi-
ble asset class’’ means— 
(A) a residential mortgage asset class; 
(B) a commercial mortgage asset class; 
(C) a public sector asset class; 
(D) a small business asset class; or 
(E) any other eligible asset class, as deter-
mined by the covered bond regulator by rule 
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