I
104TH CONGRESS
1ST SESSION
H. R. 2123
To accelerate capitalization of the Savings Association Insurance Fund, and
for other purposes.
IN THE HOUSE OF REPRESENTATIVES
JULY 27, 1995
Mr. FLAKE introduced the following bill; which was referred to the Committee
on Banking and Financial Services
A BILL
To accelerate capitalization of the Savings Association
Insurance Fund, 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; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Savings Association Insurance Fund Capitalization Act
of 1995’’.
(b) TABLE OF CONTENTS.—The table of contents for
this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Purposes.
Sec. 3. Special assessment; access to loss funds.
Sec. 4. Payment of FICO carrying costs from interest earned on deposit insur-
ance funds.
(6) To require a study of the feasibility of
merging bank and thrift charters and recommenda-
tions and proposals for achieving such merger.
SEC. 3. SPECIAL ASSESSMENT; ACCESS TO LOSS FUNDS.
(a) SPECIAL ASSESSMENT.—Section 7(b)(6) of the
Federal Deposit Insurance Act (12 U.S.C. 1817(b)(6)) is
amended—
(1) by redesignating clauses (i), (ii), and (iii) of
subparagraph (A) as subclauses (I), (II), and (III),
respectively;
(2) by redesignating subparagraphs (A) and
(B) as clauses (i) and (ii), respectively;
(3) by moving the left margin of such clauses
and subclauses (as so redesignated) 2 ems to the
right;
(4) by striking ‘‘SPECIAL
ASSESSMENTS.—In
addition to’’ and inserting ‘‘SPECIAL
ASSESS-
MENTS.—
‘‘(A) IN GENERAL.—In addition to’’; and
(5) by adding at the end the following new sub-
paragraph:
‘‘(B) SINGLE
ADDITIONAL
SPECIAL
AS-
SESSMENT
WITH
RESPECT
TO
CERTAIN
AC-
COUNTS.—
‘‘(i) IN GENERAL.—Before the end of
the 120-day period beginning on the date
of the enactment of the Savings Associa-
tion Insurance Fund Capitalization Act of
1995, the Corporation shall impose a sin-
gle special assessment on—
‘‘(I) each Savings Association In-
surance Fund member (including any
Savings Association Insurance Fund
member 
referred 
to 
in 
section
5(d)(2)(G)); and
‘‘(II) each Bank Insurance Fund
member which has deposits which are
treated, under section 5(d)(3), as de-
posits which are insured by the Sav-
ings Association Insurance Fund,
in an amount equal to such percentage of
the assessment base on which assessments
are imposed under the risk-based assess-
ment system established pursuant to para-
graph (1) (or, in the case of an institution
described in subclause (II), the adjusted
attributable deposit amount determined
under subparagraph (C) of section 5(d)(3)
for purposes of subparagraph (B)(i) of
such section) as of December 31, 1994, as
may be necessary in order for the reserve
ratio of the Savings Association Insurance
Fund to meet or exceed the designated re-
serve ratio.
‘‘(ii) DEPOSIT OF ASSESSMENT.—The
proceeds of any assessment imposed under
clause (i) shall be deposited in the Savings
Association Insurance Fund.’’.
(b) MODIFICATIONS OF CONDITIONS FOR SAIF AC-
CESS TO RTC LOSS FUNDS.—Section 11(a)(6)(F) of the
Federal Deposit Insurance Act (12 U.S.C. 1821(a)(6)(F))
is amended—
(1) in that portion of such section which ap-
pears before clause (i), by striking ‘‘2-year period’’
and inserting ‘‘before the merger of the Bank Insur-
ance Fund and the Savings Association Insurance
Fund pursuant to section 7 of the Savings Associa-
tion Insurance Fund Capitalization Act of 1995’’;
(2) by striking clauses (ii) and (iii); and
(3) by redesignating clauses (iv) through (viii)
as clauses (ii) through (vi), respectively.
SEC. 4. PAYMENT OF FICO CARRYING COSTS FROM INTER-
EST 
EARNED 
ON 
DEPOSIT 
INSURANCE
FUNDS.
(a) IN GENERAL.—Section 11(a) of the Federal De-
posit Insurance Act (12 U.S.C. 1821(a)) is amended by
adding at the end the following new paragraph:
‘‘(9) AVAILABILITY
OF
INTEREST
FOR
FICO
CARRYING COSTS.—
‘‘(A) IN GENERAL.—Interest earned on the
balance in any deposit insurance fund main-
tained by the Corporation (other than the
FSLIC Resolution Fund) shall be available for
transfer to the Financing Corporation for pur-
poses of section 21(f)(1) of the Federal Home
Loan Bank Act.
‘‘(B) AMOUNT
OF
INTEREST
PROPOR-
TIONAL TO AMOUNT OF INSURED DEPOSITS.—
The amount of interest paid to the Financing
Corporation from any insurance fund pursuant
to subparagraph (A) shall bear the same pro-
portion to the total amount of interest paid
pursuant to such subparagraph as the amount
of deposits insured by such insurance fund
bears to the total amount of insured deposits,
as determined by the Corporation on the basis
of the most recent certified statements submit-
ted to the Corporation pursuant to section
7(c)(1) and such other information as the Cor-
poration may consider appropriate.
‘‘(C) PAYMENT BY CORPORATION.—Upon
receiving notice from the Financing Corporation
of the amount needed for purposes of section
21(f) of the Federal Home Loan Bank Act, the
Corporation shall pay such amount from the in-
terest earned on the balances in the deposit in-
surance funds in accordance with subparagraph
(B), to the extent available.’’.
(b) CONFORMING AMENDMENT TO FEDERAL HOME
LOAN BANK ACT.—Section 21(f)(1) of the Federal Home
Loan Bank Act (12 U.S.C. 1441(f)(1)) is amended to read
as follows:
‘‘(1) INTEREST EARNED ON INSURED DEPOSIT
FUNDS.—The interest earned on the balance in any
deposit insurance fund maintained by the Federal
Deposit Insurance Corporation (other than the
FSLIC Resolution Fund) as provided in section
11(a)(9) of the Federal Deposit Insurance Act.’’.
SEC. 5. PROPORTIONAL SHARING OF FINANCING COR-
PORATION ASSESSMENTS TO COVER INTER-
EST SHORTFALL.
(a) IN GENERAL.—Section 21(f)(2) of the Federal
Home Loan Bank Act (12 U.S.C. 1441(f)(2)) is amended
to read as follows:
‘‘(2) ASSESSMENT AUTHORITY.—
‘‘(A) IN GENERAL.—If the amount of in-
terest earned on the balance in any deposit in-
surance fund referred to in paragraph (1) is
less than such insurance fund’s proportional
share of the amount of interest payments, issu-
ance costs, and custodial fees under section
11(a)(9)(B) of the Federal Deposit Insurance
Act, the Financing Corporation, with the ap-
proval of the Board of Directors of the Federal
Deposit Insurance Corporation, shall assess
against each member of such fund an assess-
ment (in the same manner as assessments are
assessed against such members by the Federal
Deposit Insurance Corporation under section 7
of the Federal Deposit Insurance Act).
‘‘(B) MAXIMUM
AMOUNT
OF
ASSESS-
MENT.—No assessment under subparagraph
(A) with respect to members of a deposit insur-
ance fund maintained by the Federal Deposit
Insurance Corporation may exceed the amount
authorized to be assessed against members of
such fund pursuant to section 7 of the Federal
Deposit Insurance Act.
‘‘(C) PRIORITY.—The Financing Corpora-
tion shall have first priority to make the assess-
ment authorized under subparagraph (A).’’.
(b) TECHNICAL AND CONFORMING AMENDMENT TO
THE
FEDERAL
DEPOSIT
INSURANCE
ACT.—Section
7(b)(2)(D) of the Federal Deposit Insurance Act (12
U.S.C. 1817(b)(2)(D)) is amended by striking ‘‘Savings
Association Insurance Fund members’’ and inserting
‘‘members of a deposit insurance fund’’.
(c) TECHNICAL AND CONFORMING AMENDMENT TO
THE FEDERAL HOME LOAN BANK ACT.—Section 21(k)
of the Federal Home Loan Bank Act (12 U.S.C. 1441(k))
is amended—
(1) by striking paragraph (1); and
(2) by redesignating paragraphs (2) and (3) as
paragraphs (1) and (2), respectively.
SEC. 6. REBATE OF AMOUNTS IN ANY DEPOSIT INSURANCE
FUND 
IN 
EXCESS 
OF 
THE 
FUND’S 
DES-
IGNATED RESERVE.
Subsection (e) of section 7 of the Federal Deposit In-
surance Act (12 U.S.C. 1817(e)) is amended to read as
follows:
‘‘(e) REFUNDS.—
‘‘(1) OVERPAYMENTS.—In the case of any pay-
ment of an assessment by an insured depository in-
stitution in excess of the amount due to the Cor-
poration, the Corporation may—
‘‘(A) refund the amount of the excess pay-
ment to the insured depository institution; or
‘‘(B) credit such excess amount toward the
payment of subsequent semiannual assessments
until such credit is exhausted.
‘‘(2) BALANCE IN INSURANCE FUND IN EXCESS
OF DESIGNATED RESERVE.—The amount by which
the actual reserves in any insurance fund exceed the
balance required to meet the designated reserve ap-
plicable with respect to such fund shall be refunded
to members of the fund by the Corporation on such
basis as the Board of Directors determines to be ap-
propriate, taking into account the factors considered
under the risk-based assessment system.’’.
SEC. 7. MERGER OF DEPOSIT INSURANCE FUNDS 12
MONTHS AFTER RECAPITALIZATION OF SAIF.
(a) IN GENERAL.—Effective at the end of the 12-
month period beginning on the date on which the Savings
Association Insurance Fund first achieves the designated
reserve ratio applicable with respect to such fund under
section 7(b) of the Federal Deposit Insurance Act, the
Federal Deposit Insurance Corporation shall—
(1) merge the Bank Insurance Fund and the
Savings Association Insurance Fund into 1 deposit
insurance fund; and
(2) publish a notice of such merger in the Fed-
eral Register at the time such merger becomes effec-
tive.
(b) TECHNICAL AND CONFORMING AMENDMENTS.—
(1) Section 11(a)(5) of the Federal Deposit In-
surance Act (12 U.S.C. 1821(a)(5)) is amended to
read as follows:
‘‘(5) DEPOSIT INSURANCE FUND.—
‘‘(A) ESTABLISHMENT.—There is estab-
lished a fund to be known as the deposit insur-
ance fund which shall—
‘‘(i) be maintained and administered
by the Corporation; and
‘‘(ii) initially consist of the assets and
liabilities of the Bank Insurance Fund and
Savings Association Insurance Fund which
have been merged by the Corporation into
the deposit insurance fund pursuant to
section 7(a) of the Savings Association In-
surance Fund Capitalization Act of 1995.
‘‘(B) USES.—The deposit insurance fund
shall be available to the Corporation for use
with respect to insured depository institutions.
‘‘(C) DEPOSITS.—All amounts assessed
against insured depository institutions by the
Corporation shall be deposited into the deposit
insurance fund.’’.
(2) Section 11(a) of the Federal Deposit Insur-
ance Act (12 U.S.C. 1821(a)) is amended by strik-
ing paragraphs 4(A), (6), and (7).
(3) Section 7 of the Federal Deposit Insurance
Act (12 U.S.C. 1817) is amended by striking sub-
section (l).
(4) Section 7(b)(2) of the Federal Deposit In-
surance Act (12 U.S.C. 1817(b)(2)) is amended—
(A) by striking subparagraphs (B), (F),
and (G);
(B) in clauses (i) and (iv) of subparagraph
(A), by striking ‘‘each deposit insurance fund’’
and inserting ‘‘the deposit insurance fund’’;
(C) in subparagraph (A)(iii), by striking
‘‘a deposit insurance fund’’ and inserting ‘‘the
deposit insurance fund’’; and
(D) by inserting after subparagraph (E)
the following new subparagraph:
‘‘(F) RESERVE RATIO DEFINED.—For pur-
poses of this subsection, the term ‘reserve ratio’
means the ratio of the net worth of the deposit
insurance fund to the value of the aggregate es-
timated insured deposits held in all insured de-
pository institutions.’’.
(5) Section 7(b)(3) of the Federal Deposit In-
surance Act (12 U.S.C. 1817(b)(3)) is amended—
(A) in subparagraph (A) by striking ‘‘any
deposit insurance fund’’ and inserting ‘‘the de-
posit insurance fund’’; and
(B) by striking subparagraphs (C) and
(D).
(6) Subparagraph (A) of section 7(b)(6) of the
Federal Deposit Insurance Act (as so redesignated
by section 3(a) of this Act) is amended—
(A) in clause (i) (as so redesignated)—
(i) by inserting ‘‘or’’ after the semi-
colon at the end of subclause (I);
(ii) by striking subclause (II); and
(iii) by striking ‘‘; and’’ at the end of
subclause (III) and inserting a period; and
(B) by striking clause (ii) (as so redesig-
nated).
(7) Section 7 of the Federal Deposit Insurance
Act (12 U.S.C. 1817) is amended by striking sub-
section (l).
(8) Section 11(a)(4)(B) of the Federal Deposit
Insurance Act (12 U.S.C. 1821(a)(4)(B)) is amend-
ed by striking ‘‘Bank Insurance Fund and the Sav-
ings Association Insurance Fund’’ and inserting ‘‘de-
posit insurance fund’’.
(9) Paragraph (1) of section 11(f) of the Fed-
eral Deposit Insurance Act (12 U.S.C. 1821(f)) is
amended by striking ‘‘depositor, except that—’’ and
all that follows through the period at the end of the
paragraph and inserting ‘‘depositor.’’.
(10) Section 11(i)(3) of the Federal Deposit In-
surance Act (12 U.S.C. 1821(i)(3)) is amended—
(A) by striking subparagraph (B); and
(B) in subparagraph (C), by striking ‘‘sub-
paragraphs (A) and (B)’’ and inserting ‘‘sub-
paragraph (A)’’.
(11) Section 11A(a)(3) of the Federal Deposit
Insurance Act (12 U.S.C. 1821a(a)(3)) is amended
by striking ‘‘Bank Insurance Fund, the Savings As-
sociation Insurance Fund,’’ and inserting ‘‘deposit
insurance fund’’.
(12) Section 11A(f) of the Federal Deposit In-
surance Act (12 U.S.C. 1821a(f)) is amended by
striking ‘‘Savings Association Insurance Fund’’ and
inserting ‘‘deposit insurance fund’’.
(13) Section 13(a)(1) of the Federal Deposit
Insurance Act (12 U.S.C. 1823(a)(1)) is amended
by striking ‘‘Bank Insurance Fund, Savings Associa-
tion Insurance Fund,’’ and inserting ‘‘deposit insur-
ance fund’’.
(14) Section 13(c)(4)(G) of the Federal Deposit
Insurance Act (12 U.S.C. 1823(c)(4)(G)) is amend-
ed—
(A) in clause (ii)—
(i) by striking ‘‘appropriate insurance
fund’’ and inserting ‘‘depository insurance
fund’’;
(ii) by striking ‘‘the members of the
insurance fund (of which such institution
is a member)’’ and inserting ‘‘insured de-
pository institutions’’;
(iii) by striking ‘‘each member’s’’ and
inserting ‘‘each insured depository institu-
tion’s’’; and
(iv) by striking ‘‘the member’s’’ and
inserting ‘‘the institution’s’’.
(15) Section 13(c) of the Federal Deposit In-
surance Act (12 U.S.C. 1823(c)) is amended by
striking paragraph (11).
(16) Section 13(h) of the Federal Deposit In-
surance Act (12 U.S.C. 1823(h)) is amended by
striking ‘‘Bank Insurance Fund’’ and inserting ‘‘de-
posit insurance fund’’.
(17) Section 13(k)(4)(B)(i) of the Federal De-
posit Insurance Act (12 U.S.C. 1823(k)(4)(B)(i)) is
amended by striking ‘‘Savings Association Insurance
Fund member’’ and inserting ‘‘savings association’’.
(18) Section 13(k)(5)(A) of the Federal Deposit
Insurance Act (12 U.S.C. 1823(k)(5)(A)) is amend-
ed by striking ‘‘Savings Association Insurance Fund
members’’ and inserting ‘‘savings associations’’.
(19) The penultimate sentence of section 14(a)
of the Federal Deposit Insurance Act (12 U.S.C.
1824(a)) is amended—
(A) by striking ‘‘Bank Insurance Fund or
the Savings Association Insurance Fund’’ and
inserting ‘‘depository institution fund’’; and
(B) by striking ‘‘each such fund’’ and in-
serting ‘‘the fund’’.
(20) The 1st sentence of section 14(b) of the
Federal Deposit Insurance Act (12 U.S.C. 1824(b))
is amended by striking ‘‘Bank Insurance Fund or
Savings Association Insurance Fund’’ and inserting
‘‘deposit insurance fund’’.
(21) Section 14(c) of the Federal Deposit In-
surance Act (12 U.S.C. 1824(c)) is amended by
striking paragraph (3).
(22) Section 14 of the Federal Deposit Insur-
ance Act (12 U.S.C. 1824) is amended by striking
subsection (d).
(23) Section 15(c)(5) of the Federal Deposit
Insurance Act (12 U.S.C. 1825(c)(5)) is amended—
(A) by striking ‘‘Bank Insurance Fund or
Savings Association Insurance Fund, respec-
tively,’’ and inserting ‘‘deposit insurance fund’’;
(B) by striking ‘‘Bank Insurance Fund or
Savings Association Insurance Fund, respec-
tively;’’ and inserting ‘‘deposit insurance fund;’’;
and
(C) by striking ‘‘Bank Insurance Fund or
the Savings Association Insurance Fund, re-
spectively,’’ and inserting ‘‘deposit insurance
fund,’’.
(24) Section 17(a)(1) of the Federal Deposit
Insurance Act (12 U.S.C. 1827(a)(1)) is amended
by striking ‘‘Bank Insurance Fund, the Savings As-
sociation Insurance Fund,’’ each place such term ap-
pears and inserting ‘‘deposit insurance fund’’.
(25) Section 17(d) of the Federal Deposit In-
surance Act (12 U.S.C. 1827(d)) is amended by
striking ‘‘Bank Insurance Fund, the Savings Asso-
ciation Insurance Fund,’’ each place such term ap-
pears and inserting ‘‘deposit insurance fund’’.
(26) The heading for section 17(a) of the Fed-
eral Deposit Insurance Act (12 U.S.C. 1827(a)) is
amended by striking ‘‘BIF, SAIF,’’ and inserting
‘‘THE DEPOSIT INSURANCE FUND’’.
(27) Section 18(m)(3) of the Federal Deposit
Insurance Act (12 U.S.C. 1828(m)(3)) is amend-
ed—
(A) in subparagraph (A)—
(i) by striking ‘‘Savings Association
Insurance Fund.’’ and inserting ‘‘deposit
insurance fund.’’; and
(ii) by striking ‘‘Savings Association
Insurance Fund member’’ and inserting
‘‘insured savings association’’; and
(B) in subparagraph (C), by striking ‘‘Sav-
ings Association Insurance Fund or the Bank
Insurance Fund’’ and inserting ‘‘deposit insur-
ance fund’’.
(28) Subsections (a)(1) and (d)(1)(A) of section
24 of the Federal Deposit Insurance Act (12 U.S.C.
1831a) are each amended by striking ‘‘appropriate’’.
(29) Section 24(e)(2) of the Federal Deposit
Insurance Act (12 U.S.C. 1831a(e)(2)) is amend-
ed—
(A) in subparagraph (A), by striking ‘‘of
which such banks are members’’; and
(B) in subparagraph (B)(ii), by striking
‘‘of which such bank is a member’’.
(30) Section 24(f)(6)(B) of the Federal Deposit
Insurance Act (12 U.S.C. 1831a(f)(6)(B)) is amend-
ed by striking ‘‘of which such bank is a member’’.
(31) Section 28 of the Federal Deposit Insur-
ance Act (12 U.S.C. 1831e) is amended by striking
‘‘affected deposit insurance fund’’ each place such
term appears and inserting ‘‘deposit insurance
fund’’.
(32) Section 31(a) of the Federal Deposit In-
surance Act (12 U.S.C. 1831h(a)) is amended by
striking ‘‘Insurance Fund’’.
(33) The heading for section 31 of the Federal
Deposit Insurance Act (12 U.S.C. 1831h) is amend-
ed by striking ‘‘INSURANCE FUND’’.
(34) Section 31(b)(1) of the Federal Deposit
Insurance Act (12 U.S.C. 1831h(b)(1)) is amended
by striking ‘‘insured depository institutions that are
Savings Association Insurance Fund members’’ and
inserting ‘‘insured savings associations’’.
(35) Section 31(f)(1) of the Federal Deposit In-
surance Act (12 U.S.C. 1831h(f)(1)) is amended by
striking ‘‘insured financial institutions that are
members of the Savings Association Insurance
Fund’’ and inserting ‘‘insured savings associations’’.
(36) Section 36(i)(3) of the Federal Deposit In-
surance Act (12 U.S.C. 1831m(i)(3)) is amended by
striking ‘‘affected’’.
(37) Section 38(o)(1)(A) of the Federal Deposit
Insurance Act (12 U.S.C. 1831o(o)(1)(A)) is amend-
ed by striking ‘‘Savings Association Insurance
Fund’’ and inserting ‘‘deposit insurance fund’’.
(c) EFFECTIVE
DATE
OF
AMENDMENTS.—The
amendments made by subsection (b) shall take effect as
of the end of the 12-month period described in subsection
(a).
SEC. 8. STUDY BY BANKING AGENCIES ON CONVERSIONS
TO A UNIFIED CHARTER.
(a) STUDY REQUIRED.—Before the end of the 12-
month period beginning on the date of the enactment of
this Act, the Federal banking agencies (as defined in sec-
tion 3(z) of the Federal Deposit Insurance Act) shall joint-
ly—
(1) conduct a study on—
(A) the consolidation of national bank and
savings association charters into a unified char-
ter for depository institutions; and
(B) the most feasible means for the con-
version of national banks and savings associa-
tions into depository institutions with a unified
charter;
(2) identify any difficulties or problems which
may arise in connection with such conversions; and
(3) develop proposals and recommendations for
the establishment of a unified charter and the imple-
mentation of such conversions to a unified charter.
(b) REPORT TO CONGRESS.—
(1) REPORT REQUIRED.—Before the end of the
12-month period described in subsection (a), the
agencies referred to in such subsection shall submit
a joint report to the Congress on the findings and
conclusions of the agencies with respect to the study
conducted in accordance with subsection (a).
(2) CONTENTS.—The report submitted to the
Congress pursuant to paragraph (1) shall contain
such recommendations and proposals for legislative
or administrative action as the agencies referred to
in subsection (a) may determine to be appropriate.
Æ
HR 2123 IH——2