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(2) in the 3d sentence, by inserting ‘‘(as deter-
mined without regard to the adjustment made by
subsection (b))’’ before the period; and
(2) by adding at the end the following new sub-
section:
‘‘(b) CPI ADJUSTMENTS.—
‘‘(1) IN GENERAL.—Subject to paragraph (2),
the dollar amount applicable with respect to institu-
tions described in section 303(2)(A) under the 2d
sentence of subsection (a) shall be adjusted annually
after December 31, 1996, by the annual percentage
increase in the Consumer Price Index for Urban
Wage Earners and Clerical Workers published by
the Bureau of Labor Statistics.
‘‘(2) 1-TIME ADJUSTMENT FOR PRIOR INFLA-
TION.—The first adjustment made under paragraph
(1) after the date of the enactment of the Economic
Growth and Regulatory Paperwork Reduction Act of
1996 shall be the percentage by which—
‘‘(A) the Consumer Price Index described
in such paragraph for the calendar year 1996,
exceeds
‘‘(B) such Consumer Price Index for the
calendar year 1975.
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‘‘(3) ROUNDING.—The dollar amount applicable
under paragraph (1) for any calendar year shall be
the amount determined in accordance with subpara-
graphs (A) and (B) of paragraph (2) and rounded
to the nearest multiple of $1,000,000.’’.
(b) OPPORTUNITY TO REDUCE COMPLIANCE BUR-
DEN.—Section 304 of the Home Mortgage Disclosure Act
of 1975 (12 U.S.C. 2803) is amended by adding at the
end the following new subsection:
‘‘(m) OPPORTUNITY TO REDUCE COMPLIANCE BUR-
DEN.—
‘‘(1) IN GENERAL.—
‘‘(A) SATISFACTION OF PUBLIC AVAILABIL-
ITY REQUIREMENTS.—A depository institution
shall be deemed to have satisfied the public
availability requirements of subsection (a) if the
institution compiles the information required
under that subsection at the home office of the
institution and provides notice at the branch lo-
cations specified in subsection (a) that such in-
formation is available from the home office of
the institution upon written request.
‘‘(B) PROVISION OF INFORMATION UPON
REQUEST.—Not later than 15 days after the re-
ceipt of a written request for any information
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required to be compiled under subsection (a),
the home office of the depository institution re-
ceiving the request shall provide the information
pertinent to the location of the branch in ques-
tion to the person requesting the information.
‘‘(2) FORM
OF
INFORMATION.—In complying
with paragraph (1), a depository institution shall, in
the sole discretion of the institution, provide the per-
son requesting the information with—
‘‘(A) a paper copy of the information re-
quested; or
‘‘(B) if acceptable to the person, the infor-
mation through a form of electronic medium,
such as a computer disk.’’.
SEC. 2226. ELIMINATION OF STOCK LOAN REPORTING RE-
QUIREMENT.
Section 7(j) of the Federal Deposit Insurance Act (12
U.S.C. 1817(j)) is amended—
(1) in paragraph (9)(A)—
(A) by striking ‘‘financial institution and
any affiliate of any financial institution’’ and
inserting ‘‘foreign bank, or any affiliate there-
of,’’; and
(B) by striking ‘‘by the financial institu-
tion and such institution’s affiliates’’ and in-
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serting ‘‘by the foreign bank or any affiliate
thereof’’;
(2) in paragraph (9)(B)—
(A) by striking ‘‘paragraph—’’ and insert-
ing ‘‘paragraph, the following definitions shall
apply:’’;
(B) by striking clause (i) and inserting the
following:
‘‘(i) FOREIGN BANK.—The terms ‘for-
eign bank’ and ‘affiliate’ have the same
meanings as in section 1 of the Inter-
national Banking Act of 1978.’’; and
(C) in clause (iii), by striking ‘‘financial in-
stitution’’ and inserting ‘‘foreign bank or any
affiliate thereof’’;
(3) in paragraph (9)(C)—
(A) by striking ‘‘financial institution or
any of its affiliates’’ and inserting ‘‘foreign
bank or any affiliate thereof’’; and
(B) by striking ‘‘financial institution or its
affiliates’’ and inserting ‘‘foreign bank or any
affiliate thereof’’;
(4) in paragraph (9)(D)—
(A) in clause (i)—
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(i) by striking ‘‘the financial institu-
tion and all affiliates of the institution’’
and inserting ‘‘the foreign bank and all af-
filiates thereof’’; and
(ii) by striking ‘‘financial institution
or any such affiliate’’ and inserting ‘‘for-
eign bank or affiliate thereof’’;
(B) in clause (ii), by striking ‘‘financial in-
stitution and any affiliate of such institution’’
and inserting ‘‘foreign bank and any affiliate
thereof’’; and
(C) in clause (iii), by striking ‘‘financial in-
stitution’’ and inserting ‘‘foreign bank or any
affiliate thereof’’; and
(5) in paragraph (9)(E)—
(A) in clause (i)—
(i) by striking ‘‘a financial institution
and the affiliates of such institution’’ and
inserting ‘‘a foreign bank or any affiliate
thereof’’; and
(ii) by striking ‘‘institution or affili-
ate’’ each place such term appears and in-
serting ‘‘foreign bank or any affiliate
thereof’’; and
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(B) in clause (ii), by striking ‘‘financial in-
stitution and any affiliate of such institution’’
and inserting ‘‘foreign bank and any affiliate
thereof’’.
SEC. 2227. CREDIT AVAILABILITY ASSESSMENT.
(a) STUDY.—
(1) IN GENERAL.—Not later than 12 months
after the date of enactment of this Act, and once
every 60 months thereafter, the Board, in consulta-
tion with the Director of the Office of Thrift Super-
vision, the Comptroller of the Currency, the Board
of Directors of the Corporation, the Administrator of
the National Credit Union Administration, the Ad-
ministrator of the Small Business Administration,
and the Secretary of Commerce, shall conduct a
study and submit a report to the Congress detailing
the extent of small business lending by all creditors.
(2) CONTENTS OF STUDY.—The study required
under paragraph (1) shall identify, to the extent
practicable, those factors which provide policymakers
with insights into the small business credit market,
including—
(A) the demand for small business credit,
including consideration of the impact of eco-
nomic cycles on the levels of such demand;
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CHAPTER 3—REGULATORY
MICROMANAGEMENT RELIEF
SEC. 2241. NATIONAL BANK DIRECTORS.
Section 5146 of the Revised Statutes of the United
States (12 U.S.C. 72) is amended in the first sentence,
by striking ‘‘except’’ and all that follows through the end
of the sentence and inserting the following: ‘‘except that
the Comptroller may, in the discretion of the Comptroller,
waive the requirement of residency.’’.
SEC. 2242. PAPERWORK REDUCTION REVIEW.
Section 303(a) of the Riegle Community Develop-
ment and Regulatory Improvement Act of 1994 (12
U.S.C. 4803(a)) is amended—
(1) by redesignating paragraphs (2) and (3) as
paragraphs (3) and (4), respectively; and
(2) by inserting after paragraph (1) the follow-
ing new paragraph:
‘‘(2) review the extent to which existing regula-
tions require insured depository institutions and in-
sured credit unions to produce unnecessary internal
written policies and eliminate such requirements,
where appropriate;’’.
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SEC. 2243. STATE BANK REPRESENTATION ON BOARD OF
DIRECTORS OF THE FDIC.
Section 2(a)(1)(C) of the Federal Deposit Insurance
Act (12 U.S.C. 1812(a)(1)(C)) is amended by inserting
before the period ‘‘, 1 of whom shall have State bank su-
pervisory experience’’.
SEC. 2244. CONSULTATION AMONG EXAMINERS.
(a) IN GENERAL.—Section 10 of the Federal Deposit
Insurance Act (12 U.S.C. 1820) is amended by adding at
the end the following new subsection:
‘‘(j) CONSULTATION AMONG EXAMINERS.—
‘‘(1) IN GENERAL.—Each appropriate Federal
banking agency shall take such action as may be
necessary to ensure that examiners employed by the
agency—
‘‘(A) consult on examination activities with
respect to any depository institution; and
‘‘(B) achieve an agreement and resolve any
inconsistencies in the recommendations to be
given to such institution as a consequence of
any examinations.
‘‘(2) EXAMINER-IN-CHARGE.—Each appropriate
Federal banking agency shall consider appointing an
examiner-in-charge with respect to a depository in-
stitution to ensure consultation on examination ac-
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tivities among all of the examiners of that agency in-
volved in examinations of the institution.’’.
(b) COORDINATED
AND
UNIFIED
EXAMINATION
FLEXIBILITY.—Section 10(d)(6)(B) of the Federal De-
posit Insurance Act (12 U.S.C. 1820(d)(6)(B)) is amend-
ed by inserting ‘‘or State bank supervisors’’ after ‘‘one of
the Federal agencies’’.
Subtitle C—Regulatory Impact on
Cost of Credit and Credit Avail-
ability
SEC. 2301. AUDIT COSTS.
(a) AUDITOR ATTESTATIONS.—Section 36 of the
Federal Deposit Insurance Act (12 U.S.C. 1831m) is
amended by striking subsection (e) and inserting the fol-
lowing:
‘‘(e) [Repealed]’’.
(b) INDEPENDENT AUDIT COMMITTEES.—Section
36(g)(1) of the Federal Deposit Insurance Act (12 U.S.C.
1831m(g)(1)) is amended—
(1) in subparagraph (A), by inserting ‘‘, except
as provided in subparagraph (D)’’ after ‘‘manage-
ment of the institution’’; and
(2) by adding at the end the following new sub-
paragraph:
‘‘(D) EXEMPTION AUTHORITY.—
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‘‘(i) IN
GENERAL.—An appropriate
Federal banking agency may, by order or
regulation, permit the independent audit
committee of an insured depository institu-
tion to be made up of less than all, but no
fewer than a majority of, outside directors,
if the agency determines that the institu-
tion has encountered hardships in retain-
ing and recruiting a sufficient number of
competent outside directors to serve on the
internal audit committee of the institution.
‘‘(ii) FACTORS TO BE CONSIDERED.—
In determining whether an insured deposi-
tory institution has encountered hardships
referred to in clause (i), the appropriate
Federal banking agency shall consider fac-
tors such as the size of the institution, and
whether the institution has made a good
faith effort to elect or name additional
competent outside directors to the board of
directors of the institution who may serve
on the internal audit committee.’’.
(c) PUBLIC AVAILABILITY.—Section 36(a)(3) of the
Federal Deposit Insurance Act (12 U.S.C. 1831m(a)(3))
is amended by adding at the end the following: ‘‘Notwith-
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standing the preceding sentence, the Corporation and the
appropriate Federal banking agencies may designate cer-
tain information as privileged and confidential and not
available to the public.’’.
SEC. 2302. INCENTIVES FOR SELF-TESTING.
(a) EQUAL CREDIT OPPORTUNITY.—
(1) IN
GENERAL.—The Equal Credit Oppor-
tunity Act (15 U.S.C. 1691 et seq.) is amended by
inserting after section 704 the following new section:
‘‘SEC. 704A. INCENTIVES FOR SELF-TESTING AND SELF-
CORRECTION.
‘‘(a) PRIVILEGED INFORMATION.—
‘‘(1) CONDITIONS FOR PRIVILEGE.—A report or
result of a self-test (as that term is defined by regu-
lations of the Board) shall be considered to be privi-
leged under paragraph (2) if a creditor—
‘‘(A) conducts, or authorizes an independ-
ent third party to conduct, a self-test of any as-
pect of a credit transaction by a creditor, in
order to determine the level or effectiveness of
compliance with this title by the creditor; and
‘‘(B) has identified any possible violation
of this title by the creditor and has taken, or
is taking, appropriate corrective action to ad-
dress any such possible violation.
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‘‘(2) PRIVILEGED
SELF-TEST.—If a creditor
meets the conditions specified in subparagraphs (A)
and (B) of paragraph (1) with respect to a self-test
described in that paragraph, any report or results of
that self-test—
‘‘(A) shall be privileged; and
‘‘(B) may not be obtained or used by any
applicant, department, or agency in any—
‘‘(i) proceeding or civil action in which
one or more violations of this title are al-
leged; or
‘‘(ii) examination or investigation re-
lating to compliance with this title.
‘‘(b) RESULTS OF SELF-TESTING.—
‘‘(1) IN GENERAL.—No provision of this section
may be construed to prevent an applicant, depart-
ment, or agency from obtaining or using a report or
results of any self-test in any proceeding or civil ac-
tion in which a violation of this title is alleged, or
in any examination or investigation of compliance
with this title if—
‘‘(A) the creditor or any person with lawful
access to the report or results—
‘‘(i) voluntarily releases or discloses
all, or any part of, the report or results to
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the applicant, department, or agency, or to
the general public; or
‘‘(ii) refers to or describes the report
or results as a defense to charges of viola-
tions of this title against the creditor to
whom the self-test relates; or
‘‘(B) the report or results are sought in
conjunction with an adjudication or admission
of a violation of this title for the sole purpose
of determining an appropriate penalty or rem-
edy.
‘‘(2) DISCLOSURE
FOR
DETERMINATION
OF
PENALTY OR REMEDY.—Any report or results of a
self-test that are disclosed for the purpose specified
in paragraph (1)(B)—
‘‘(A) shall be used only for the particular
proceeding in which the adjudication or admis-
sion referred to in paragraph (1)(B) is made;
and
‘‘(B) may not be used in any other action
or proceeding.
‘‘(c) ADJUDICATION.—An applicant, department, or
agency that challenges a privilege asserted under this sec-
tion may seek a determination of the existence and appli-
cation of that privilege in—
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‘‘(1) a court of competent jurisdiction; or
‘‘(2) an administrative law proceeding with ap-
propriate jurisdiction.’’.
(2) REGULATIONS.—
(A) IN
GENERAL.—Not later than 6
months after the date of enactment of this Act,
in consultation with the Secretary of Housing
and Urban Development and the agencies re-
ferred to in section 704 of the Equal Credit Op-
portunity Act, and after providing notice and
an opportunity for public comment, the Board
shall prescribe final regulations to implement
section 704A of the Equal Credit Opportunity
Act, as added by this section.
(B) SELF-TEST.—
(i) 
DEFINITION.—The 
regulations
prescribed under subparagraph (A) shall
include a definition of the term ‘‘self-test’’
for purposes of section 704A of the Equal
Credit Opportunity Act, as added by this
section.
(ii) REQUIREMENT FOR SELF-TEST.—
The regulations prescribed under subpara-
graph (A) shall specify that a self-test
shall be sufficiently extensive to constitute
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a determination of the level and effective-
ness of compliance by a creditor with the
Equal Credit Opportunity Act.
(iii) SUBSTANTIAL
SIMILARITY
TO
CERTAIN
FAIR
HOUSING
ACT
REGULA-
TIONS.—The regulations prescribed under
subparagraph (A) shall be substantially
similar to the regulations prescribed by the
Secretary of Housing and Urban Develop-
ment to carry out section 814A(d) of the
Fair Housing Act, as added by this sec-
tion.
(3) CLERICAL AMENDMENT.—The table of sec-
tions for title VII of the Consumer Credit Protection
Act is amended by inserting after the item relating
to section 704 the following new item:
‘‘704A. Incentives for self-testing and self-correction.’’.
(b) FAIR HOUSING.—
(1) IN GENERAL.—The Fair Housing Act (42
U.S.C. 3601 et seq.) is amended by inserting after
section 814 the following new section:
‘‘SEC. 814A. INCENTIVES FOR SELF-TESTING AND SELF-
CORRECTION.
‘‘(a) PRIVILEGED INFORMATION.—
‘‘(1) CONDITIONS FOR PRIVILEGE.—A report or
result of a self-test (as that term is defined by regu-
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lation of the Secretary) shall be considered to be
privileged under paragraph (2) if any person—
‘‘(A) conducts, or authorizes an independ-
ent third party to conduct, a self-test of any as-
pect of a residential real estate related lending
transaction of that person, or any part of that
transaction, in order to determine the level or
effectiveness of compliance with this title by
that person; and
‘‘(B) has identified any possible violation
of this title by that person and has taken, or is
taking, appropriate corrective action to address
any such possible violation.
‘‘(2) PRIVILEGED
SELF-TEST.—If a person
meets the conditions specified in subparagraphs (A)
and (B) of paragraph (1) with respect to a self-test
described in that paragraph, any report or results of
that self-test—
‘‘(A) shall be privileged; and
‘‘(B) may not be obtained or used by any
applicant, department, or agency in any—
‘‘(i) proceeding or civil action in which
one or more violations of this title are al-
leged; or
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‘‘(ii) examination or investigation re-
lating to compliance with this title.
‘‘(b) RESULTS OF SELF-TESTING.—
‘‘(1) IN GENERAL.—No provision of this section
may be construed to prevent an aggrieved person,
complainant, department, or agency from obtaining
or using a report or results of any self-test in any
proceeding or civil action in which a violation of this
title is alleged, or in any examination or investiga-
tion of compliance with this title if—
‘‘(A) the person to whom the self-test re-
lates or any person with lawful access to the re-
port or the results—
‘‘(i) voluntarily releases or discloses
all, or any part of, the report or results to
the aggrieved person, complainant, depart-
ment, or agency, or to the general public;
or
‘‘(ii) refers to or describes the report
or results as a defense to charges of viola-
tions of this title against the person to
whom the self-test relates; or
‘‘(B) the report or results are sought in
conjunction with an adjudication or admission
of a violation of this title for the sole purpose
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of determining an appropriate penalty or rem-
edy.
‘‘(2) DISCLOSURE
FOR
DETERMINATION
OF
PENALTY OR REMEDY.—Any report or results of a
self-test that are disclosed for the purpose specified
in paragraph (1)(B)—
‘‘(A) shall be used only for the particular
proceeding in which the adjudication or admis-
sion referred to in paragraph (1)(B) is made;
and
‘‘(B) may not be used in any other action
or proceeding.
‘‘(c) ADJUDICATION.—An aggrieved person, com-
plainant, department, or agency that challenges a privilege
asserted under this section may seek a determination of
the existence and application of that privilege in—
‘‘(1) a court of competent jurisdiction; or
‘‘(2) an administrative law proceeding with ap-
propriate jurisdiction.’’.
(2) REGULATIONS.—
(A) IN
GENERAL.—Not later than 6
months after the date of enactment of this Act,
in consultation with the Board and after provid-
ing notice and an opportunity for public com-
ment, the Secretary of Housing and Urban De-
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velopment shall prescribe final regulations to
implement section 814A of the Fair Housing
Act, as added by this section.
(B) SELF-TEST.—
(i) 
DEFINITION.—The 
regulations
prescribed by the Secretary under subpara-
graph (A) shall include a definition of the
term ‘‘self-test’’ for purposes of section
814A of the Fair Housing Act, as added
by this section.
(ii) REQUIREMENT FOR SELF-TEST.—
The regulations prescribed by the Sec-
retary under subparagraph (A) shall speci-
fy that a self-test shall be sufficiently ex-
tensive to constitute a determination of the
level and effectiveness of the compliance by
a person engaged in residential real estate
related lending activities with the Fair
Housing Act.
(iii) SUBSTANTIAL
SIMILARITY
TO
CERTAIN
EQUAL
CREDIT
OPPORTUNITY
ACT REGULATIONS.—The regulations pre-
scribed under subparagraph (A) shall be
substantially similar to the regulations pre-
scribed by the Board to carry out section
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704A of the Equal Credit Opportunity Act,
as added by this section.
(c) APPLICABILITY.—
(1) IN GENERAL.—Except as provided in para-
graph (2), the privilege provided for in section 704A
of the Equal Credit Opportunity Act or section
814A of the Fair Housing Act (as those sections are
added by this section) shall apply to a self-test (as
that term is defined pursuant to the regulations pre-
scribed under subsection (a)(2) or (b)(2) of this sec-
tion, as appropriate) conducted before, on, or after
the effective date of the regulations prescribed under
subsection (a)(2) or (b)(2), as appropriate.
(2) EXCEPTION.—The privilege referred to in
paragraph (1) does not apply to such a self-test con-
ducted before the effective date of the regulations
prescribed under subsection (a) or (b), as appro-
priate, if—
(A) before that effective date, a complaint
against the creditor or person engaged in resi-
dential real estate related lending activities (as
the case may be) was—
(i) formally filed in any court of com-
petent jurisdiction; or
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(ii) the subject of an ongoing adminis-
trative law proceeding;
(B) in the case of section 704A of the
Equal Credit Opportunity Act, the creditor has
waived the privilege pursuant to subsection
(b)(1)(A)(i) of that section; or
(C) in the case of section 814A of the Fair
Housing Act, the person engaged in residential
real estate related lending activities has waived
the privilege pursuant to subsection (b)(1)(A)(i)
of that section.
SEC. 2303. QUALIFIED THRIFT INVESTMENT AMENDMENTS.
(a) CREDIT CARDS.—Section 5(b) of the Home Own-
ers’ Loan Act (12 U.S.C. 1464(b)) is amended—
(1) by striking paragraph (4); and
(2) by redesignating paragraph (5) as para-
graph (4).
(b) LOANS OR INVESTMENTS WITHOUT PERCENTAGE
OF ASSETS LIMITATION.—Section 5(c)(1) of the Home
Owners’ Loan Act (12 U.S.C. 1464(c)(1)) is amended by
adding at the end the following new subparagraphs:
‘‘(T) CREDIT CARD LOANS.—Loans made
through credit cards or credit card accounts.
‘‘(U) EDUCATIONAL LOANS.—Loans made
for the payment of educational expenses.’’.
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(c) COMMERCIAL
AND
OTHER
LOANS.—Section
5(c)(2)(A) of the Home Owners’ Loan Act (12 U.S.C.
1464(c)(2)(A)) is amended to read as follows:
‘‘(A) COMMERCIAL AND OTHER LOANS.—
Secured or unsecured loans for commercial, cor-
porate, business, or agricultural purposes. The
aggregate amount of loans made under this
subparagraph may not exceed 20 percent of the
total assets of the Federal savings association,
and amounts in excess of 10 percent of such
total assets may be used under this subpara-
graph only for small business loans, as that
term is defined by the Director.’’.
(d) LOANS OR INVESTMENTS LIMITED TO 5 PER-
CENT OF ASSETS.—Section 5(c)(3) of the Home Owners’
Loan Act (12 U.S.C. 1464(c)(3)) is amended—
(1) by striking subparagraph (A); and
(2) by redesignating subparagraphs (B), (C),
and (D) as subparagraphs (A), (B), and (C), respec-
tively.
(e) QUALIFIED THRIFT LENDER TEST.—Section
10(m)(1) of the Home Owners’ Loan Act (12 U.S.C.
1467a(m)(1)) is amended—
(1) by redesignating subparagraph (B) as
clause (ii);
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(2) in subparagraph (A), by striking ‘‘(A) the
savings’’ and inserting ‘‘(B)(i) the savings’’; and
(3) by inserting after ‘‘if—’’ the following new
subparagraph:
‘‘(A) the savings association qualifies as a
domestic building and loan association, as such
term is defined in section 7701(a)(19) of the
Internal Revenue Code of 1986; or’’.
(f) BRANCHING.—Section 5(r) of the Home Owners’
Loan Act (12 U.S.C. 1464(r)) is amended—
(1) in paragraph (1)—
(A) in the first sentence—
(i) by inserting before the period ‘‘, or
qualifies as a qualified thrift lender, as de-
termined under section 10(m) of this Act’’;
and
(ii) by striking ‘‘(c)’’ and inserting
‘‘(C)’’; and
(B) in the second sentence, by inserting
before the period ‘‘or as a qualified thrift lend-
er, as determined under section 10(m) of this
Act, as applicable’’; and
(2) in paragraph (2), by striking subparagraph
(C) and inserting the following:
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‘‘(C) the law of the State where the branch is
located, or is to be located, would permit establish-
ment of the branch if the association was a savings
association or savings bank chartered by the State
in which its home office is located; or’’.
(g) DEFINITION.—Section 10(m)(4) of the Home
Owners’ Loan Act (12 U.S.C. 1467a(m)(4)) is amended—
(1) by striking ‘‘subsection—’’ and inserting
‘‘subsection, the following definitions shall apply:’’;
(2) in subparagraph (C)—
(A) in clause (ii), by adding at the end the
following new subclause:
‘‘(VII) Loans for educational
purposes, loans to small businesses,
and loans made through credit cards
or credit card accounts.’’; and
(B) in clause (iii), by striking subclause
(VI) and inserting the following:
‘‘(VI) Loans for personal, family,
or household purposes (other than
loans for personal, family, or house-
hold purposes described in clause
(ii)(VII)).’’; and
(3) by adding at the end the following new sub-
paragraphs:
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‘‘(D) CREDIT
CARD.—The Director shall
issue such regulations as may be necessary to
define the term ‘credit card’.
‘‘(E) SMALL
BUSINESS.—The Director
shall issue such regulations as may be necessary
to define the term ‘small business’.’’.
SEC. 2304. LIMITED PURPOSE BANKS.
(a) GROWTH CAP RELIEF.—Section 4(f)(3)(B) of the
Bank Holding Company Act of 1956 (12 U.S.C.
1843(f)(3)(B)) is amended—
(1) in clause (ii), by adding ‘‘or’’ at the end;
(2) in clause (iii), by striking ‘‘; or’’ at the end
and inserting a period; and
(3) by striking clause (iv).
(b) LIMITED PURPOSE BANK EXCEPTION.—Section
2(c)(2)(F) of the Bank Holding Company Act of 1956 (12
U.S.C. 1841(c)(2)(F)) is amended by inserting ‘‘, includ-
ing an institution that accepts collateral for extensions of
credit by holding deposits under $100,000, and by other
means’’ after ‘‘An institution’’.
SEC. 2305. AMENDMENT TO FAIR DEBT COLLECTION PRAC-
TICES ACT.
(a) IN GENERAL.—Section 807(11) of the Fair Debt
Collection Practices Act (15 U.S.C. 1692e(11)) is amend-
ed to read as follows:
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‘‘(11) The failure to disclose in the initial writ-
ten communication with the consumer and, in addi-
tion, if the initial communication with the consumer
is oral, in that initial oral communication, that the
debt collector is attempting to collect a debt and
that any information obtained will be used for that
purpose, and the failure to disclose in subsequent
communications that the communication is from a
debt collector, except that this paragraph shall not
apply to a formal pleading made in connection with
a legal action.’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall take effect 90 days after the date of
enactment of this Act and shall apply to all communica-
tions made after that date of enactment.
SEC. 2306. INCREASE IN CERTAIN CREDIT UNION LOAN
CEILINGS.
Section 107(5)(A) of the Federal Credit Union Act
(12 U.S.C. 1757(5)(A)) is amended—
(1) in clause (iv), by striking ‘‘$10,000’’ and in-
serting ‘‘$20,000’’; and
(2) in clause (v), by striking ‘‘$10,000’’ and in-
serting ‘‘$20,000’’.
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SEC. 2307. BANK INVESTMENTS IN EDGE ACT AND AGREE-
MENT CORPORATIONS.
The 10th undesignated paragraph of section 25A of
the Federal Reserve Act (12 U.S.C. 618) is amended by
striking the last sentence and inserting the following:
‘‘Any national bank may invest in the stock of any cor-
poration organized under this section. The aggregate
amount of stock held by any national bank in all corpora-
tions engaged in business of the kind described in this sec-
tion or section 25 shall not exceed an amount equal to
10 percent of the capital and surplus of such bank unless
the Board determines that the investment of an additional
amount by the bank would not be unsafe or unsound and,
in any case, shall not exceed an amount equal to 20 per-
cent of the capital and surplus of such bank.’’.
Subtitle D—Consumer Credit
CHAPTER 1—CREDIT REPORTING
REFORM
SEC. 2401. SHORT TITLE.
This chapter may be cited as the ‘‘Consumer Credit
Reporting Reform Act of 1996’’.
SEC. 2402. DEFINITIONS.
(a) ADVERSE ACTION.—Section 603 of the Fair
Credit Reporting Act (15 U.S.C. 1681a) is amended by
adding at the end the following new subsection:
‘‘(k) ADVERSE ACTION.—
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‘‘(1) ACTIONS INCLUDED.—The term ‘adverse
action’—
‘‘(A) has the same meaning as in section
701(d)(6) of the Equal Credit Opportunity Act;
and
‘‘(B) means—
‘‘(i) a denial or cancellation of, an in-
crease in any charge for, or a reduction or
other adverse or unfavorable change in the
terms of coverage or amount of, any insur-
ance, existing or applied for, in connection
with the underwriting of insurance;
‘‘(ii) a denial of employment or any
other decision for employment purposes
that adversely affects any current or pro-
spective employee;
‘‘(iii) a denial or cancellation of, an
increase in any charge for, or any other
adverse or unfavorable change in the terms
of, any license or benefit described in sec-
tion 604(a)(3)(D); and
‘‘(iv) an action taken or determination
that is—
‘‘(I) made in connection with an
application that was made by, or a
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transaction that was initiated by, any
consumer, or in connection with a re-
view of an account under section
604(a)(3)(F)(ii); and
‘‘(II) adverse to the interests of
the consumer.
‘‘(2) APPLICABLE FINDINGS, DECISIONS, COM-
MENTARY, AND ORDERS.—For purposes of any de-
termination of whether an action is an adverse ac-
tion under paragraph (1)(A), all appropriate final
findings, decisions, commentary, and orders issued
under section 701(d)(6) of the Equal Credit Oppor-
tunity Act by the Board of Governors of the Federal
Reserve System or any court shall apply.’’.
(b) FIRM OFFER OF CREDIT OR INSURANCE.—Sec-
tion 603 of the Fair Credit Reporting Act (15 U.S.C.
1681a) (as amended by subsection (a) of this section) is
amended by adding at the end the following new sub-
section:
‘‘(l) FIRM OFFER OF CREDIT OR INSURANCE.—The
term ‘firm offer of credit or insurance’ means any offer
of credit or insurance to a consumer that will be honored
if the consumer is determined, based on information in
a consumer report on the consumer, to meet the specific
criteria used to select the consumer for the offer, except
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that the offer may be further conditioned on one or more
of the following:
‘‘(1) The consumer being determined, based on
information in the consumer’s application for the
credit or insurance, to meet specific criteria bearing
on credit worthiness or insurability, as applicable,
that are established—
‘‘(A) before selection of the consumer for
the offer; and
‘‘(B) for the purpose of determining
whether to extend credit or insurance pursuant
to the offer.
‘‘(2) Verification—
‘‘(A) that the consumer continues to meet
the specific criteria used to select the consumer
for the offer, by using information in a
consumer report on the consumer, information
in the consumer’s application for the credit or
insurance, or other information bearing on the
credit 
worthiness 
or 
insurability 
of 
the
consumer; or
‘‘(B) of the information in the consumer’s
application for the credit or insurance, to deter-
mine that the consumer meets the specific cri-
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teria bearing on credit worthiness or insurabil-
ity.
‘‘(3) The consumer furnishing any collateral
that is a requirement for the extension of the credit
or insurance that was—
‘‘(A) established before selection of the
consumer for the offer of credit or insurance;
and
‘‘(B) disclosed to the consumer in the offer
of credit or insurance.’’.
(c) CREDIT OR INSURANCE TRANSACTION THAT IS
NOT INITIATED BY THE CONSUMER.—Section 603 of the
Fair Credit Reporting Act (15 U.S.C. 1681a) (as amended
by subsection (b) of this section) is amended by adding
at the end the following new subsection:
‘‘(m) CREDIT OR INSURANCE TRANSACTION THAT IS
NOT INITIATED BY THE CONSUMER.—The term ‘credit or
insurance transaction that is not initiated by the
consumer’ does not include the use of a consumer report
by a person with which the consumer has an account or
insurance policy, for purposes of—
‘‘(1) reviewing the account or insurance policy;
or
‘‘(2) collecting the account.’’.
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(d) STATE.—Section 603 of the Fair Credit Report-
ing Act (15 U.S.C. 1681a) (as amended by subsection (c)
of this section) is amended by adding at the end the fol-
lowing new subsection:
‘‘(n) STATE.—The term ‘State’ means any State, the
Commonwealth of Puerto Rico, the District of Columbia,
and any territory or possession of the United States.’’.
(e) DEFINITION OF CONSUMER REPORT.—Section
603(d) of the Fair Credit Reporting Act (15 U.S.C.
1681a(d)) is amended—
(1) by striking ‘‘(d) The term’’ and inserting
the following:
‘‘(d) CONSUMER REPORT.—
‘‘(1) IN GENERAL.—The term’’;
(2) by striking ‘‘for (1) credit’’ and inserting
the following: ‘‘for—
‘‘(A) credit’’;
(3) by striking ‘‘purposes, or (2)’’ and all that
follows through ‘‘section 604.’’ and inserting the fol-
lowing: ‘‘purposes;
‘‘(B) employment purposes; or
‘‘(C) any other purpose authorized under
section 604.’’; and
(4) by striking the second sentence and insert-
ing the following:
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‘‘(2) EXCLUSIONS.—The term ‘consumer re-
port’ does not include—
‘‘(A) any—
‘‘(i) report containing information
solely as to transactions or experiences be-
tween the consumer and the person mak-
ing the report;
‘‘(ii) communication of that informa-
tion among persons related by common
ownership or affiliated by corporate con-
trol; or
‘‘(iii) any communication of other in-
formation among persons related by com-
mon ownership or affiliated by corporate
control, if it is clearly and conspicuously
disclosed to the consumer that the infor-
mation may be communicated among such
persons and the consumer is given the op-
portunity, before the time that the infor-
mation is initially communicated, to direct
that such information not be commu-
nicated among such persons;
‘‘(B) any authorization or approval of a
specific extension of credit directly or indirectly
by the issuer of a credit card or similar device;
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‘‘(C) any report in which a person who has
been requested by a third party to make a spe-
cific extension of credit directly or indirectly to
a consumer conveys his or her decision with re-
spect to such request, if the third party advises
the consumer of the name and address of the
person to whom the request was made, and
such person makes the disclosures to the
consumer required under section 615; or
‘‘(D) a communication described in sub-
section (o).’’.
(f) EXCLUSION OF CERTAIN COMMUNICATIONS BY
EMPLOYMENT
AGENCIES
FROM
DEFINITION
OF
CONSUMER REPORT.—Section 603 of the Fair Credit Re-
porting Act (15 U.S.C. 1681a) is amended by adding at
the end the following new subsection:
‘‘(o) EXCLUDED COMMUNICATIONS.—A communica-
tion is described in this subsection if it is a communica-
tion—
‘‘(1) that, but for subsection (d)(2)(E), would
be an investigative consumer report;
‘‘(2) that is made to a prospective employer for
the purpose of—
‘‘(A) procuring an employee for the em-
ployer; or
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‘‘(B) procuring an opportunity for a natu-
ral person to work for the employer;
‘‘(3) that is made by a person who regularly
performs such procurement;
‘‘(4) that is not used by any person for any
purpose other than a purpose described in subpara-
graph (A) or (B) of paragraph (2); or
‘‘(5) with respect to which—
‘‘(A) the consumer who is the subject of
the communication—
‘‘(i) consents orally or in writing to
the nature and scope of the communica-
tion, before the collection of any informa-
tion for the purpose of making the commu-
nication;
‘‘(ii) consents orally or in writing to
the making of the communication to a pro-
spective employer, before the making of the
communication; and
‘‘(iii) in the case of consent under
clause (i) or (ii) given orally, is provided
written confirmation of that consent by the
person making the communication, not
later than 3 business days after the receipt
of the consent by that person;
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‘‘(B) the person who makes the commu-
nication does not, for the purpose of making
the communication, make any inquiry that if
made by a prospective employer of the
consumer who is the subject of the communica-
tion would violate any applicable Federal or
State equal employment opportunity law or reg-
ulation; and
‘‘(C) the person who makes the commu-
nication—
‘‘(i) discloses in writing to the
consumer who is the subject of the commu-
nication, not later than 5 business days
after receiving any request from the
consumer for such disclosure, the nature
and substance of all information in the
consumer’s file at the time of the request,
except that the sources of any information
that is acquired solely for use in making
the communication and is actually used for
no other purpose, need not be disclosed
other than under appropriate discovery
procedures in any court of competent juris-
diction in which an action is brought; and
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‘‘(ii) notifies the consumer who is the
subject of the communication, in writing,
of the consumer’s right to request the in-
formation described in clause (i).’’.
(g) CONSUMER REPORTING AGENCY THAT COM-
PILES
AND
MAINTAINS
FILES
ON
A
NATIONWIDE
BASIS.—Section 603 of the Fair Credit Reporting Act (15
U.S.C. 1681a) (as amended by subsection (f) of this sec-
tion) is amended by adding at the end the following new
subsection:
‘‘(p) CONSUMER REPORTING AGENCY THAT COM-
PILES AND MAINTAINS FILES ON CONSUMERS ON A NA-
TIONWIDE BASIS.—The term ‘consumer reporting agency
that compiles and maintains files on consumers on a na-
tionwide basis’ means a consumer reporting agency that
regularly engages in the practice of assembling or evaluat-
ing, and maintaining, for the purpose of furnishing
consumer reports to third parties bearing on a consumer’s
credit worthiness, credit standing, or credit capacity, each
of the following regarding consumers residing nationwide:
‘‘(1) Public record information.
‘‘(2) Credit account information from persons
who furnish that information regularly and in the
ordinary course of business.’’.
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SEC. 2403. FURNISHING CONSUMER REPORTS; USE FOR EM-
PLOYMENT PURPOSES.
(a) FURNISHING CONSUMER REPORTS FOR BUSI-
NESS TRANSACTIONS.—Section 604 of the Fair Credit Re-
porting Act (15 U.S.C. 1681b) is amended—
(1) by inserting ‘‘(a) IN GENERAL.—’’ before
‘‘A consumer reporting agency’’; and
(2) in subsection (a)(3) (as so designated by
paragraph (1) of this subsection), by striking sub-
paragraph (E) and inserting the following:
‘‘(E) intends to use the information, as a
potential investor or servicer, or current in-
surer, in connection with a valuation of, or an
assessment of the credit or prepayment risks
associated with, an existing credit obligation; or
‘‘(F) otherwise has a legitimate business
need for the information—
‘‘(i) in connection with a business
transaction 
that 
is 
initiated 
by 
the
consumer; or
‘‘(ii) to review an account to deter-
mine whether the consumer continues to
meet the terms of the account.’’.
(b) FURNISHING AND USING CONSUMER REPORTS
FOR EMPLOYMENT PURPOSES.—Section 604 of the Fair
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Credit Reporting Act (15 U.S.C. 1681b) is amended by
adding at the end the following new subsection:
‘‘(b) CONDITIONS
FOR FURNISHING
AND USING
CONSUMER REPORTS FOR EMPLOYMENT PURPOSES.—
‘‘(1) CERTIFICATION FROM USER.—A consumer
reporting agency may furnish a consumer report for
employment purposes only if—
‘‘(A) the person who obtains such report
from the agency certifies to the agency that—
‘‘(i) the person has complied with
paragraph 
(2) 
with 
respect 
to 
the
consumer report, and the person will com-
ply with paragraph (3) with respect to the
consumer report if paragraph (3) becomes
applicable; and
‘‘(ii) information from the consumer
report will not be used in violation of any
applicable Federal or State equal employ-
ment opportunity law or regulation; and
‘‘(B) the consumer reporting agency pro-
vides with the report a summary of the consum-
er’s rights under this title, as prescribed by the
Federal 
Trade 
Commission 
under 
section
609(c)(3).
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SEC. 2418. FEDERAL RESERVE BOARD AUTHORITY.
Section 621 of the Fair Credit Reporting Act (15
U.S.C. 1681s) is amended by adding at the end the follow-
ing new subsection:
‘‘(e) INTERPRETIVE AUTHORITY.—The Board of
Governors of the Federal Reserve System may issue inter-
pretations of any provision of this title as such provision
may apply to any persons identified under paragraph (1),
(2), and (3) of subsection (b), or to the holding companies
and affiliates of such persons, in consultation with Federal
agencies identified in paragraphs (1), (2), and (3) of sub-
section (b).’’.
SEC. 2419. PREEMPTION OF STATE LAW.
Section 624 of the Fair Credit Reporting Act (as re-
designated by section 2413(a) of this chapter) is amend-
ed—
(1) by striking ‘‘This title’’ and inserting ‘‘(a)
IN GENERAL.—Except as provided in subsections
(b) and (c), this title’’; and
(2) by adding at the end the following new sub-
section:
‘‘(b) GENERAL EXCEPTIONS.—No requirement or
prohibition may be imposed under the laws of any State—
‘‘(1) with respect to any subject matter regu-
lated under—
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‘‘ ‘Consumer Credit File Rights
Under State and Federal Law
‘‘ ‘You have a right to dispute inaccurate information
in your credit report by contacting the credit bureau di-
rectly. However, neither you nor any ‘‘credit repair’’ com-
pany or credit repair organization has the right to have
accurate, current, and verifiable information removed
from your credit report. The credit bureau must remove
accurate, negative information from your report only if it
is over 7 years old. Bankruptcy information can be re-
ported for 10 years.
‘‘ ‘You have a right to obtain a copy of your credit
report from a credit bureau. You may be charged a rea-
sonable fee. There is no fee, however, if you have been
turned down for credit, employment, insurance, or a rental
dwelling because of information in your credit report with-
in the preceding 60 days. The credit bureau must provide
someone to help you interpret the information in your
credit file. You are entitled to receive a free copy of your
credit report if you are unemployed and intend to apply
for employment in the next 60 days, if you are a recipient
of public welfare assistance, or if you have reason to be-
lieve that there is inaccurate information in your credit
report due to fraud.