176
standing subparagraph (B)(i), a bank con-
trolled by a company described in para-
graph (1) that meets the requirements of
clause (i) may engage in an activity au-
thorized under applicable law (other than
an activity that would have resulted in the
institution being a bank for purposes of
this Act, as in effect on the day before the
date of the enactment of the Competitive
Equality Banking Act of 1987, based on
the activities each bank conducted on
March 5, 1987, as reported to the Board)
if such bank, at least 60 days before com-
mencing such activity, has notified the
Board of the bank’s intention to commence
such activity and either—
‘‘(I) the Board has notified such
bank that the Board will not dis-
approve the proposed activity as un-
safe or unsound; or
‘‘(II) the Board has not, within
60 days after receiving such notice,
disapproved the proposal on the basis
of such criteria.
177
‘‘(iii) QUALIFICATION FOR EXCEPTION
FROM
CROSS-MARKETING
RESTRICTION.—
Notwithstanding subparagraph (B)(ii), a
bank controlled by a company described in
paragraph (1) that meets the requirements
of clause (i) may offer or market products
or services of an affiliate or permit the
bank’s products or services to be offered or
marketed in connection with products or
services of an affiliate if such products or
services are offered or marketed only to
the extent permissible for banks or finan-
cial services holding companies to provide
by law, regulation, or order under sub-
section (c)(8).
‘‘(iv) EXCEPTION FROM DIVESTITURE
REQUIREMENT FOR BANKS RESTORED TO
WELL CAPITALIZED LEVEL.—If any bank
controlled by a company that meets the re-
quirements of clause (i) ceases to be well
capitalized, the company shall divest con-
trol of such bank in accordance with para-
graph (4) unless—
‘‘(I) within 12 months after the
date the bank ceases to be well cap-
178
italized, the capital of the bank is re-
stored to the well capitalized level;
and
‘‘(II) after the end of such 12-
month period, the bank remains well
capitalized, subject to the capital res-
toration requirements in subclause (I).
‘‘(v) ACTION
REQUIRED
IF
BANK
CEASES
TO
BE
ADEQUATELY
CAPITAL-
IZED.—If any bank controlled by a com-
pany that meets the requirements of clause
(i) ceases to be adequately capitalized, the
company shall, within 30 days after the
date as of which the bank ceases to be ade-
quately capitalized—
‘‘(I) execute an agreement with
the Board to divest control of such
bank in accordance with paragraph
(4); or
‘‘(II) restore the capital of the
bank to at least the adequately cap-
italized level.’’.
(2) QUALIFICATIONS
FOR
COMPANIES
UNDER
PARAGRAPH (3)(D).—Section 4(f) of the Bank Hold-
ing Company Act of 1956 (12 U.S.C. 1843(f)) is
179
amended by adding at the end the following new
paragraph:
‘‘(14) QUALIFICATIONS FOR COMPANIES UNDER
PARAGRAPH (3)(D).—A company meets the require-
ments of paragraph (3)(D)(i) if—
‘‘(A) the company (based on consolidated
revenues) engages predominantly in activities
that are financial in nature (including activities
not authorized under subsection (c)(8)) or are
incidental to such financial activities;
‘‘(B) all insured depository institutions
controlled by such company are well capitalized
and well managed; and
‘‘(C) the company has provided at least 60
days prior written notice to the Board and, dur-
ing that period, the Board has not disapproved
the proposal.’’.
(b) AMENDED DIVESTITURE PROCEDURE FOR CER-
TAIN COMPANIES.—Section 4(f)(4) of the Bank Holding
Company Act of 1956 (12 U.S.C. 1843(f)(4)) is amended
by adding at the end the following: ‘‘If any company de-
scribed in paragraph (1) which meets the requirements of
paragraph (3)(D)(i) fails to qualify for the exemption pro-
vided under paragraph (2), such company shall divest, in
accordance with this paragraph, control of each bank the
180
company controls unless, within 12 months after the date
that the company fails to comply with the provisions of
paragraph (2), the company has corrected the condition
or ceased the activity that led to the failure to comply.’’.
(c) CONVERSION OF CERTAIN NONBANK HOLDING
COMPANIES TO FINANCIAL SERVICES HOLDING COMPA-
NIES.—Section 4(f) of the Bank Holding Company Act
of 1956 (12 U.S.C. 1843(f)) is amended by inserting after
paragraph (14) (as added by subsection (a)(2)) the follow-
ing new paragraph:
‘‘(15) CONVERSION OF CERTAIN COMPANIES TO
FINANCIAL SERVICES HOLDING COMPANIES.—
‘‘(A) IN GENERAL.—During the 18-month
period beginning on the date of the enactment
of the Financial Institutions Regulatory Relief
Act of 1996, any company described in para-
graph (1) may become a financial services hold-
ing company if—
‘‘(i) the company (on a consolidated
basis) engages predominantly in activities
that are financial in nature (including ac-
tivities not authorized under subsection
(c)(8)) or are incidental to such financial
activities;
181
‘‘(ii) all insured depository institutions
controlled by such company are well cap-
italized and well managed;
‘‘(iii) the company provides written
notice to the Board under section 4 at
least 60 days before the company becomes
a financial services holding company; and
‘‘(iv) the Board does not object to
such transaction before the end of such 60-
day period; and
‘‘(B) RETENTION
OF
FINANCIAL
COMPA-
NIES.—
‘‘(i) IN
GENERAL.—Notwithstanding
subsection (a), a company that becomes a
financial services holding company pursu-
ant to subparagraph (A) may retain direct
or indirect ownership or control of voting
shares of any company that engages solely
in activities that the Board finds to be fi-
nancial but which the Board has not au-
thorized under subsection (c)(8) (and such
other financial activities that the Board
has authorized) if the financial services
holding company acquired the shares of
such company, or of each company to
182
which such company is a successor, before
January 1, 1995.
‘‘(ii) LIMITS
FOLLOWING
REGISTRA-
TION.—A company that becomes a finan-
cial services holding company pursuant to
this paragraph, and any company whose
shares are owned or controlled by a finan-
cial services holding company pursuant to
this paragraph, shall be subject to the limi-
tations contained in paragraph (3) of sec-
tion 4(k) as if the activities or shares of
such company were conducted or held pur-
suant to section 4(k)(2).
‘‘(iii) PERIOD
TO
CONFORM
OTHER
ACTIVITIES.—Notwithstanding 
subsection
(a), a company that becomes a financial
services holding company pursuant to sub-
paragraph (A) may retain direct or indi-
rect ownership or control of voting shares
of any company not otherwise permitted
under this section for the period provided
in, and subject to the conditions contained
in, paragraphs (2) and (3) of section 4(k).
‘‘(C) ELECTION
FOR
REDUCED
SUPER-
VISION.—Any company that becomes a financial
183
services holding company pursuant to subpara-
graph (A) may elect to be governed by the pro-
visions of paragraphs (3), (4), (5), and (6) of
section 5(g), subject to the requirements of
such section, if—
‘‘(i) the company, and any insured de-
pository institution controlled by such com-
pany, meet the requirements of section
5(g) (other than the requirements of para-
graph (2)(A) of such section);
‘‘(ii) the company does not acquire
more than 5 percent of the shares of any
additional depository institution after the
date that such company becomes a finan-
cial services holding company; and
‘‘(iii) no depository institution con-
trolled by such company acquires, estab-
lishes, or operates an additional branch of-
fice after the date that the company be-
comes a financial services holding com-
pany.’’.
SEC. 510. DISCRETION OF FEDERAL RESERVE BOARD.
(a) APPLICATIONS.—Section 3 of the Bank Holding
Company Act of 1956 (12 U.S.C. 1842) is amended by
adding at the end the following new subsection:
184
‘‘(h) DISCRETION
WITH
REGARD
TO
APPLICA-
TIONS.—In the case of an application by an entity which
is subject to this section because such entity owns or con-
trols 5 percent or more of the voting stock of a bank hold-
ing company, the Board may—
‘‘(1) waive the filing requirement under this
section with respect to applications by such entity if
the Board determines that no regulatory purpose
would be served by such filing requirement; and
‘‘(2) adjust the manner in which the Board may
require any company to seek the Board’s approval
under subsection (a) for a proposed action or the
manner in which the Board reviews any such pro-
posed action, including—
‘‘(A) adjustments with regard to the types
and amount of information which the Board
may require to be included in any type of appli-
cation or proposal submitted for the Board’s
approval under subsection (a); and
‘‘(B) waiver of any requirement for an ap-
plication, or reducing the scope of an applica-
tion, (including an application by a corporation
of a central or provincial government) in any
case in which the Board determines that—
185
‘‘(i) an applicant does not and will not
exercise significant managerial control
over, or otherwise holds a purely passive
investment in the voting securities of, a
bank or another bank holding company,
notwithstanding the fact that the applicant
directly or indirectly owns, controls, or has
the power to vote more than 5 percent of
any class of voting securities of such bank
or other bank holding company; or
‘‘(ii) requiring an application, or re-
quiring an extensive application, by an en-
tity, in connection with the application by
a bank holding company subsidiary of such
entity to acquire a bank, would not serve
any legitimate regulatory need of the
Board in rendering a decision with regard
to the application of such bank holding
company subsidiary.’’.
(b) COLLATERAL.—Section 11(m) of the Federal Re-
serve Act (12 U.S.C. 248) is amended—
(1) by striking ‘‘not less than six of’’
(2) by inserting a comma after ‘‘its members’’;
(3) by striking ‘‘but no such loan shall be made
by any such bank to any person in an amount in ex-
186
cess of 15 percent of the unimpaired capital and
surplus of such bank: Provided, That’’ and inserting
‘‘except that’’; and
(4) by striking ‘‘15 percent on loans to any per-
son’’.
SEC. 511. QUALIFIED FAMILY PARTNERSHIPS.
Section 2 of the Bank Holding Company Act of 1956
(12 U.S.C. 1841) is amended—
(1) in subsection (b), by inserting ‘‘, and shall
not include a qualified family partnership’’ after ‘‘by
any State’’; and
(2) by inserting after subsection (q) (as added
by section 505(b)(3) of this subtitle) the following
new subsection:
‘‘(r) QUALIFIED FAMILY PARTNERSHIP.—For pur-
poses of this Act, the term ‘qualified family partnership’
means a general or limited partnership which the Board
determines—
‘‘(1) does not directly control any banks, except
through a registered bank holding company;
‘‘(2) does not control more than 1 registered
bank holding company;
‘‘(3) does not engage in any business activity,
except indirectly through ownership of other busi-
ness entities;
187
‘‘(4) has no investments other than those per-
mitted for a bank holding company pursuant to sec-
tion 4(c);
‘‘(5) is not obligated on any debt, either directly
or as a guarantor;
‘‘(6) has partners, all of whom are either—
‘‘(A) individuals related to each other by
blood, marriage (including former marriage), or
adoption; or
‘‘(B) trusts for the primary benefit of indi-
viduals so related; and
‘‘(7) has filed with the Board a statement
which includes—
‘‘(A) the basis for the eligibility of the
partnership under paragraph (6);
‘‘(B) a list of the existing activities and in-
vestments of the partnership;
‘‘(C) a commitment to comply with this
subsection;
‘‘(D) a commitment to comply with section
7 of the Federal Deposit Insurance Act with re-
spect to any acquisition of control of an insured
depository institution occurring after the date
of enactment of this subsection; and
‘‘(E) a commitment to be subject to—
188
‘‘(i) examination by the Board to as-
sure compliance with this subsection; and
‘‘(ii) section 8 of the Federal Deposit
Insurance Act,
to the same extent as if the qualified family
partnership were a bank holding company.’’.
Subtitle B—Interagency Banking
and Financial Services Task Force
SEC. 521. INTERAGENCY BANKING AND FINANCIAL SERV-
ICES TASK FORCE.
(a) ESTABLISHMENT; COMPOSITION.—There is here-
by established the Banking and Financial Services Task
Force (hereafter in this subtitle referred to as the ‘‘Task
Force’’) which shall consist of 7 members as follows:
(1) The Secretary of the Treasury.
(2) The Chairman of the Board of Governors of
the Federal Reserve System.
(3) The Chairperson of the Board of Directors
of the Federal Deposit Insurance Corporation.
(4) The Chairman of the Securities and Ex-
change Commission.
(5) The Chairperson of the Commodities Fu-
tures Trading Commission.
(6) The Comptroller of the Currency.
189
(7) A State bank supervisor (as defined in sec-
tion 3(r) of the Federal Deposit Insurance Act) se-
lected by the chairperson of the task force.
(b) CHAIRPERSON.—The chairperson of the Task
Force shall be the Secretary of the Treasury.
(c) DESIGNATION OF OFFICERS AND EMPLOYEES.—
The members of the Task Force may, from time to time,
designate other officers or employees of their respective
agencies to carry out their duties on the Task Force.
(d) COMPENSATION AND EXPENSES.—Each member
of the Task Force shall serve without additional com-
pensation but shall be entitled to reasonable expenses in-
curred in carrying out official duties as a member.
(e) FUNCTION OF THE TASK FORCE.—
(1) IN GENERAL.—The Task Force shall meet
as appropriate to consider matters of mutual inter-
est to the members and to consider making rec-
ommendations to the Board of Governors of the
Federal Reserve System regarding the types of ac-
tivities that may be financial in nature for purposes
of the Financial Services Holding Company Act and
to the Comptroller of the Currency regarding the
types of activities that may be incidental to banking
for purposes of section 5136 of the Revised Statutes
of the United States.
190
(2) CONSIDERATION OF RECOMMENDATIONS.—
The Board of Governors of the Federal Reserve Sys-
tem and the Comptroller of the Currency, as appro-
priate, shall take into account any recommendation
made to the respective agency by the Task Force
and, if the agency does not adopt the recommenda-
tion, shall provide a written explanation to the Task
Force.
(f) IMPROVING THE SUPERVISION, EFFICIENCY, AND
COMPETITIVENESS OF THE FINANCIAL SERVICES INDUS-
TRY.—
(1) IN GENERAL.—The Task Force shall seek
to improve the supervision, efficiency, and competi-
tiveness of the financial services industry by making
recommendations for such legislative or administra-
tive action as the Task Force determines to be ap-
propriate to the Congress, each agency or office rep-
resented by a member on the Task Force, and other
agencies or departments of the United States, in-
cluding recommendations for changes in law and in
the regulations, policies, and procedures of any de-
partment or agency.
(2) PRINTING
IN
FEDERAL
REGISTER.—Rec-
ommendations from paragraph (1) shall be printed
in the Federal Register and submitted to the Com-
191
mittee on Banking and Financial Services of the
House of Representatives and the Committee on
Banking, Housing, and Urban Affairs of the Senate.
SEC. 522. FINANCIAL SERVICES ADVISORY COMMITTEE.
(a) ESTABLISHMENT.—There is hereby established
the Financial Services Advisory Committee (hereinafter in
this section referred to as the ‘‘Committee’’) to the Task
Force.
(b) MEMBERSHIP.—
(1) IN GENERAL.—The Committee shall consist
of 9 members, appointed as follows from among in-
dividuals who are not officers or employees of the
Federal Government and who are especially qualified
to serve on such committee by virtue of their edu-
cation, training, or experience:
(A) 1 member appointed by the Secretary
of the Treasury.
(B) 2 members appointed by the Comptrol-
ler of the Currency.
(C) 2 members appointed by the Director
of the Office of Thrift Supervision.
(D) 2 members appointed by the Board of
Governors of the Federal Reserve System.
192
(E) 2 members appointed by the Board of
Directors of the Federal Deposit Insurance Cor-
poration.
(2) REPRESENTATION
OF
SMALL
AND
INDE-
PENDENT
DEPOSITORY
INSTITUTIONS.—Of 
the
members appointed under subparagraphs (B), (C),
(D), and (E) of paragraph (1), 1 of the 2 members
appointed under each such paragraph shall be ap-
pointed from among individuals who are especially
qualified to represent the interests of depository in-
stitutions which—
(A) 
have 
total 
assets 
of 
less 
than
$500,000,000; or
(B) are not controlled by any depository
institution holding company.
(c) VACANCIES.—Any vacancy on the Committee
shall be filled in the same manner in which the original
appointment was made.
(d) PAY AND EXPENSES.—Members of the Commit-
tee shall serve without pay, but each member shall be re-
imbursed for expenses incurred in connection with attend-
ance of such members at meetings of the Committee by
the agency which appointed such member to the Commit-
tee.
193
(e) TERMS.—Members shall be appointed for terms
of 3 years.
(f) AUTHORITY OF THE COMMITTEE.—The Commit-
tee may select a chairperson, vice chairperson, and sec-
retary, and adopt methods of procedure, and shall have
power—
(1) to confer with each member of the Task
Force on general and special business conditions and
regulatory and other matters relating to the finan-
cial services industry in the United States; and
(2) to request information from, and to make
recommendations to, each Federal agency or office
represented on the Task Force with respect to mat-
ters within the jurisdiction of such agency or office.
(g) MEETINGS.—The Committee shall meet annually
at the call of the chairperson or a majority of the mem-
bers.
(h) REPORTS.—The Committee shall submit an an-
nual written report to the Committee on Banking and Fi-
nancial Services of the House and to the Committee on
Banking, Housing, and Urban Affairs of the Senate. Such
report shall describe the activities of the Committee for
such annual period and contain such recommendations as
the Committee considers appropriate.
194
(i) PROVISION OF STAFF AND OTHER RESOURCES.—
Each of the Federal banking agencies shall provide the
Committee with the use of such resources, including staff,
as the Committee reasonably shall require to carry out its
duties, including the preparation and submission of re-
ports to Congress, under this section.
(j) DEFINITION.—For purposes of this section, the
term ‘‘insured depository institution’’ has the meaning
given to such term in section 3 of the Federal Deposit
Insurance Act.
(k) FEDERAL ADVISORY COMMITTEE ACT DOES NOT
APPLY.—The Federal Advisory Committee Act shall not
apply to the Committee.
(l) SUNSET.—The Committee shall cease to exist on
the earlier of—
(1) the abolition of the Task Force; or
(2) the end of the 10-year period beginning on
the date of the enactment of this Act.
TITLE VI—DROUGHT RELIEF
SEC. 601. COOPERATIVE EFFORTS BETWEEN DEPOSITORY
INSTITUTIONS AND FARMERS AND RANCH-
ERS IN DROUGHT-STRICKEN AREAS.
(a) FINDINGS.—The Congress hereby finds the fol-
lowing:
195
(1) Severe drought is being experienced in the
Plains and the Southwest portions of our country.
(2) Soil erosion is becoming a critical issue as
the dry season approaches and summer winds may
rob these fields of nutrient-rich topsoil.
(3) Without immediate assistance, ranchers and
farmers would be forced to cull their herds bringing
tremendous volatility in the beef market.
(4) The American people will feel the impact of
this drought in their pocketbooks through higher
prices for grain products.
(5) The communities in drought-stricken areas
are suffering and borrowers may have difficulty
meeting their obligations to financial institutions.
(6) Congress has already passed the Depository
Institutions Disaster Relief Act of 1992 which allows
financial institutions to make emergency exceptions
to the appraisal requirement in times of national dis-
asters.
(b) SENSE OF THE CONGRESS.—It is the sense of
the Congress that financial institutions and Federal bank
regulators should work cooperatively with farmers and
ranchers in communities affected by drought conditions to
allow financial obligations to be met without imposing
undue burdens.
196
TITLE VII—FINANCIAL
ACTIVITIES
SEC. 701. FINANCIAL ACTIVITIES.
Section 4(c)(8) of the Bank Holding Company Act
of 1956 (12 U.S.C. 1843(c)(8)) is amended—
(1) by striking ‘‘shares of any company’’ and all
that follows through ‘‘broker’’ and inserting ‘‘shares
of any company the activities of which the Board
after due notice has determined (by order, regula-
tion, or advisory opinion) to be financial in nature
or incidental to such financial activities. In deter-
mining whether an activity is financial in nature or
incidental to financial activities, the Board shall take
into account changes or reasonably expected changes
in the marketplace in which financial services hold-
ing companies compete as well as changes or reason-
ably expected changes in the technology by which
these services are delivered. In addition, the Board
shall take into account activities considered financial
activities or banking or financial operations for pur-
poses of the regulation of the Board designated as
‘Regulation K’ (12 C.F.R. 211.23 (f)(5)(iii)(B)) as
in effect on the date of the enactment of the Finan-
cial Institutions Regulatory Relief Act of 1996. Any
activity that the Board has determined, by order or
197
regulation that is in effect on such date to be so
closely related to banking or managing or controlling
banks as to be a proper incident thereto shall be
deemed to be of a financial nature for purposes of
this paragraph without further action by the Board
(subject to the same terms and conditions contained
in such order or regulation, unless modified by the
Board), but for purposes of this subsection it shall
not be closely related to banking or managing or
controlling banks or financial in nature or incidental
to a financial activity for a financial services holding
company to provide any annuity contract the income
on which is tax-deferred under section 72 of the In-
ternal Revenue Code of 1986 as a principal, agent,
or broker, or to provide insurance as a principal,
agent, or broker’’;
(2) by striking the second sentence; and
(3) by inserting after the period at the end of
the 1st sentence the following new sentence: ‘‘For
purposes of subparagraphs (A) through (F), the
term ‘insurance agency activity’, and for purposes of
subparagraph (G), the term ‘activity’ includes pro-
viding any annuity contract as agent or broker.’’.
198
SEC. 702. RETIREMENT CERTIFICATES OF DEPOSITS.
(a) IN GENERAL.—Section 3(l)(5) of the Federal De-
posit Insurance Act (12 U.S.C. 1813(l)(5) is amended—
(1) in subparagraph (A), by striking ‘‘and’’ at
the end;
(2) in subparagraph (B), by striking the period
at the end and inserting ‘‘; and’’; and
(3) by adding at the end the following new sub-
paragraph:
‘‘(C) any liability of an insured depository
institution that arises under an annuity con-
tract, the income of which is tax deferred under
section 72 of the Internal Revenue Code of
1986.’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) shall apply to any liability of an insured
depository that arises under an annuity contract issued
on or after the date of enactment of this Act.
SEC. 703. GAO STUDY OF STATE SUPERVISION OF NA-
TIONAL BANK INSURANCE ACTIVITIES.
(a) STUDY REQUIRED.—The Comptroller General of
the United States shall conduct a study to determine
whether the supervision by State insurance regulators of
insurance activities of national banks is adequate or com-
parable to the supervision of nonbank activities.
199
(b) CONSULTATION.—In conducting the study pursu-
ant to subsection (a), the Comptroller General shall con-
sult with State insurance regulators, Federal and State
banking regulators, and representatives of insurance asso-
ciations, banking associations, and consumer groups.
(c) REPORT.—Before the end of the 180-day period
beginning on the date of the enactment of this Act, the
Comptroller General shall submit a report to the Congress
on the findings and conclusions of the Comptroller General
together with such recommendations as the Comptroller
General determines to be appropriate.
SEC. 704. NATIONAL BANK LICENSING REQUIREMENTS.
(a) IN GENERAL.—Chapter 1 of title LXII of the Re-
vised Statutes of the United States (12 U.S.C. 21 et seq.)
is amended—
(1) by redesignating section 5136A as section
5136B; and
(2) by inserting after section 5136 (12 U.S.C.
24) the following new section:
‘‘SEC. 5136A. NATIONAL BANK LICENSING REQUIREMENTS.
‘‘National banks shall comply with applicable non-
discriminatory State—
‘‘(1) licensing requirements establishing char-
acter, experience, and educational qualifications for
individuals selling insurance as agents;
200
‘‘(2) testing and continuing education require-
ments for individuals selling insurance as agents;
and
‘‘(3) standards and requirements for types of li-
censes and for license renewals that apply to individ-
uals selling insurance as agents.
‘‘(b) RULE OF CONSTRUCTION.—No provision of this
section shall be construed as affecting the applicability or
nonapplicability of other Federal laws or State laws to the
insurance activities of national banks.’’.
(b) CLERICAL AMENDMENT.—The table of sections
for chapter 1 of title LXII of the Revised Statutes of the
United States is amended—
(1) by redesignating the item relating to section
5136A as section 5136B; and
(2) by inserting after the item relating to sec-
tion 5136 the following new item:
‘‘5136A. National bank licensing requirements.’’.
(c) TECHNICAL AND CONFORMING AMENDMENT.—
Section 1306 of title 18, United States Code, is amended
by striking ‘‘5136A’’ and inserting ‘‘5136B’’.
TITLE VIII—DEPOSIT
INSURANCE FUNDS
SEC. 801. SHORT TITLE.
This title may be cited as the ‘‘Deposit Insurance
Funds Act of 1996’’.
201
SEC. 802. SPECIAL ASSESSMENT TO CAPITALIZE SAIF.
(a) IN GENERAL.—Except as provided in subsections
(f) and (k), the Board of Directors of the Federal Deposit
Insurance Corporation shall impose a special assessment
on the SAIF-assessable deposits of each insured deposi-
tory institution in accordance with assessment regulations
of the Corporation at a rate applicable to all such institu-
tions that the Board of Directors, in its sole discretion,
determines (after taking into account the adjustments de-
scribed in subsections (g), (h), and (j)) will cause the Sav-
ings Association Insurance Fund to achieve the designated
reserve ratio on the first business day of the 1st month
beginning after the date of the enactment of this Act.
(b) FACTORS TO BE CONSIDERED.—In carrying out
subsection (a), the Board of Directors shall base its deter-
mination on—
(1) the monthly Savings Association Insurance
Fund balance most recently calculated;
(2) data on insured deposits reported in the
most recent reports of condition filed not later than
70 days before the date of enactment of this Act by
insured depository institutions; and
(3) any other factors that the Board of Direc-
tors deems appropriate.
(c) DATE
OF DETERMINATION.—For purposes of
subsection (a), the amount of the SAIF-assessable depos-
202
its of an insured depository institution shall be determined
as of March 31, 1995.
(d) DATE PAYMENT DUE.—Except as provided in
subsection (g), the special assessment imposed under this
section shall be—
(1) due on the first business day of the 1st
month beginning after the date of the enactment of
this Act; and
(2) paid to the Corporation on the later of—
(A) the first business day of the 1st month
beginning after such date of enactment; or
(B) such other date as the Corporation
shall prescribe, but not later than 60 days after
the date of enactment of this Act.
(e) ASSESSMENT DEPOSITED
IN SAIF.—Notwith-
standing any other provision of law, the proceeds of the
special assessment imposed under this section shall be de-
posited in the Savings Association Insurance Fund.
(f) EXEMPTIONS FOR CERTAIN INSTITUTIONS.—
(1) EXEMPTION
FOR
WEAK
INSTITUTIONS.—
The Board of Directors may, by order, in its sole
discretion, exempt any insured depository institution
that the Board of Directors determines to be weak,
from paying the special assessment imposed under
this section if the Board of Directors determines
203
that the exemption would reduce risk to the Savings
Association Insurance Fund.
(2) GUIDELINES REQUIRED.—Not later than 30
days after the date of enactment of this Act, the
Board of Directors shall prescribe guidelines setting
forth the criteria that the Board of Directors will
use in exempting institutions under paragraph (1).
Such guidelines shall be published in the Federal
Register.
(3) EXEMPTION
FOR
CERTAIN
NEWLY
CHAR-
TERED AND OTHER DEFINED INSTITUTIONS.—
(A) IN GENERAL.—In addition to the insti-
tutions exempted from paying the special as-
sessment under paragraph (1), the Board of
Directors shall exempt any insured depository
institution from payment of the special assess-
ment if the institution—
(i) was in existence on October 1,
1995, and held no SAIF-assessable depos-
its before January 1, 1993;
(ii) is a Federal savings bank which—
(I) was established de novo in
April 1994 in order to acquire the de-
posits of a savings association which
204
was in default or in danger of default;
and
(II) received minority interim
capital assistance from the Resolution
Trust 
Corporation 
under 
section
21A(w) of the Federal Home Loan
Bank Act in connection with the ac-
quisition of any such savings associa-
tion; or
(iii) is a savings association, the de-
posits of which are insured by the Savings
Association Insurance Fund, which—
(I) before January 1, 1987, was
chartered as a Federal savings bank
insured by the Federal Savings and
Loan Insurance Corporation for the
purpose of acquiring all or substan-
tially all of the assets and assuming
all or substantially all of the deposit
liabilities of a national bank in a
transaction consummated after July
1, 1986; and
(II) as of the date of that trans-
action, had assets of less than
$150,000,000.
205
(B) DEFINITION.—For purposes of this
paragraph, an institution shall be deemed to
have held SAIF-assessable deposits before Jan-
uary 1, 1993, if—
(i) it directly held SAIF-assessable de-
posits before that date; or
(ii) it succeeded to, acquired, pur-
chased, or otherwise holds any SAIF-as-
sessable deposits as of the date of enact-
ment of this Act that were SAIF-assess-
able deposits before January 1, 1993.
(4) EXEMPT INSTITUTIONS REQUIRED TO PAY
ASSESSMENTS AT FORMER RATES.—
(A) PAYMENTS TO SAIF AND DIF.—Any in-
sured depository institution that the Board of
Directors exempts under this subsection from
paying the special assessment imposed under
this section shall pay semiannual assessments—
(i) during calendar years 1996, 1997,
and 1998, into the Savings Association In-
surance Fund, based on SAIF-assessable
deposits of that institution, at assessment
rates calculated under the schedule in ef-
fect for Savings Association Insurance
Fund members on June 30, 1995; and
206
(ii) during calendar year 1999—
(I) into the Deposit Insurance
Fund, based on SAIF-assessable de-
posits of that institution as of Decem-
ber 31, 1998, at assessment rates cal-
culated under the schedule in effect
for Savings Association Insurance
Fund members on June 30, 1995; or
(II) in accordance with clause (i),
if the Bank Insurance Fund and the
Savings Association Insurance Fund
are not merged into the Deposit In-
surance Fund.
(B) OPTIONAL
PRO
RATA
PAYMENT
OF
SPECIAL
ASSESSMENT.—This paragraph shall
not apply with respect to any insured depository
institution (or successor insured depository in-
stitution) that has paid, during any calendar
year from 1997 through 1999, upon such terms
as the Corporation may announce, an amount
equal to the product of—
(i) 16.7 percent of the special assess-
ment that the institution would have been
required to pay under subsection (a), if the
207
Board of Directors had not exempted the
institution; and
(ii) the number of full semiannual pe-
riods remaining between the date of the
payment and December 31, 1999.
(g) SPECIAL ELECTION FOR CERTAIN INSTITUTIONS
FACING HARDSHIP AS A RESULT OF THE SPECIAL AS-
SESSMENT.—
(1) ELECTION AUTHORIZED.—If—
(A) an insured depository institution, or
any depository institution holding company
which, directly or indirectly, controls such insti-
tution, is subject to terms or covenants in any
debt obligation or preferred stock outstanding
on September 13, 1995; and
(B) the payment of the special assessment
under subsection (a) would pose a significant
risk of causing such depository institution or
holding company to default or violate any such
term or covenant,
the depository institution may elect, with the ap-
proval of the Corporation, to pay such special as-
sessment in accordance with paragraphs (2) and (3)
in lieu of paying such assessment in the manner re-
quired under subsection (a).
208
(2) FIRST
ASSESSMENT.—An insured deposi-
tory institution which makes an election under para-
graph (1) shall pay an assessment in an amount
equal to 50 percent of the amount of the special as-
sessment that would otherwise apply under sub-
section (a), by the date on which such special assess-
ment is payable under subsection (d).
(3) SECOND ASSESSMENT.—An insured deposi-
tory institution which makes an election under para-
graph (1) shall pay a second assessment, by the date
established by the Board of Directors in accordance
with paragraph (4), in an amount equal to the prod-
uct of 51 percent of the rate determined by the
Board of Directors under subsection (a) for deter-
mining the amount of the special assessment and the
SAIF-assessable deposits of the institution on March
31, 1996, or such other date in calendar year 1996
as the Board of Directors determines to be appro-
priate.
(4) DUE DATE OF SECOND ASSESSMENT.—The
date established by the Board of Directors for the
payment of the assessment under paragraph (3) by
a depository institution shall be the earliest prac-
ticable date which the Board of Directors determines
to be appropriate, which is at least 15 days after the
209
date used by the Board of Directors under para-
graph (3).
(5) SUPPLEMENTAL
SPECIAL
ASSESSMENT.—
An insured depository institution which makes an
election under paragraph (1) shall pay a supple-
mental special assessment, at the same time the pay-
ment under paragraph (3) is made, in an amount
equal to the product of—
(A) 50 percent of the rate determined by
the Board of Directors under subsection (a) for
determining the amount of the special assess-
ment; and
(B) 95 percent of the amount by which the
SAIF-assessable deposits used by the Board of
Directors for determining the amount of the 1st
assessment under paragraph (2) exceeds, if any,
the SAIF-assessable deposits used by the Board
for determining the amount of the second as-
sessment under paragraph (3).
(h) ADJUSTMENT
OF SPECIAL ASSESSMENT
FOR
CERTAIN BANK INSURANCE FUND MEMBER BANKS.—
(1) IN GENERAL.—For purposes of computing
the special assessment imposed under this section
with respect to a Bank Insurance Fund member
bank, the amount of any deposits of any insured de-
210
pository institution which section 5(d)(3) of the Fed-
eral Deposit Insurance Act treats as insured by the
Savings Association Insurance Fund shall be re-
duced by 20 percent—
(A) if the adjusted attributable deposit
amount of the Bank Insurance Fund member
bank is less than 50 percent of the total domes-
tic deposits of that member bank as of June 30,
1995; or
(B) if, as of June 30, 1995, the Bank In-
surance Fund member—
(i) had an adjusted attributable de-
posit amount equal to less than 75 percent
of the total assessable deposits of that
member bank;
(ii) had total assessable deposits
greater than $5,000,000,000; and
(iii) was owned or controlled by a
bank holding company that owned or con-
trolled insured depository institutions hav-
ing an aggregate amount of deposits in-
sured or treated as insured by the Bank
Insurance Fund greater than the aggre-
gate amount of deposits insured or treated
211
as insured by the Savings Association In-
surance Fund.
(2) 
ADJUSTED
ATTRIBUTABLE
DEPOSIT
AMOUNT.—For purposes of this subsection, the ‘‘ad-
justed attributable deposit amount’’ shall be deter-
mined in accordance with section 5(d)(3)(C) of the
Federal Deposit Insurance Act.
(i) ADJUSTMENT TO THE ADJUSTED ATTRIBUTABLE
DEPOSIT AMOUNT FOR CERTAIN BANK INSURANCE FUND
MEMBER BANKS.—Section 5(d)(3) of the Federal Deposit
Insurance Act (12 U.S.C. 1815(d)(3)) is amended—
(1) in subparagraph (C), by striking ‘‘The ad-
justed attributable deposit amount’’ and inserting
‘‘Except as provided in subparagraph (K), the ad-
justed attributable deposit amount’’; and
(2) by adding at the end the following new sub-
paragraph:
‘‘(K) ADJUSTMENT OF ADJUSTED ATTRIB-
UTABLE DEPOSIT AMOUNT.—The amount deter-
mined under subparagraph (C)(i) for deposits
acquired by March 31, 1995, shall be reduced
by 20 percent for purposes of computing the
adjusted attributable deposit amount for the
payment of any assessment for any semiannual
period that begins after the date of the enact-
212
ment of the Deposit Insurance Funds Act of
1996 (other than the special assessment im-
posed under section 802(a) of such Act), for a
Bank Insurance Fund member bank that, as of
June 30, 1995—
‘‘(i) had an adjusted attributable de-
posit amount that was less than 50 percent
of the total deposits of that member bank;
or
‘‘(ii)(I) had an adjusted attributable
deposit amount equal to less than 75 per-
cent of the total assessable deposits of that
member bank;
‘‘(II) had total assessable deposits
greater than $5,000,000,000; and
‘‘(III) was owned or controlled by a
bank holding company that owned or con-
trolled insured depository institutions hav-
ing an aggregate amount of deposits in-
sured or treated as insured by the Bank
Insurance Fund greater than the aggre-
gate amount of deposits insured or treated
as insured by the Savings Association In-
surance Fund.’’.
213
(j) ADJUSTMENT
OF SPECIAL ASSESSMENT
FOR
CERTAIN SAVINGS ASSOCIATIONS.—
(1) SPECIAL
ASSESSMENT
REDUCTION.—For
purposes of computing the special assessment im-
posed under this section, in the case of any con-
verted association, the amount of any deposits of
such association which were insured by the Savings
Association Insurance Fund as of March 31, 1995,
shall be reduced by 20 percent.
(2) CONVERTED
ASSOCIATION.—For purposes
of this subsection, the term ‘‘converted association’’
means—
(A) any Federal savings association—
(i) that is a member of the Savings
Association Insurance Fund and that has
deposits subject to assessment by that
fund which did not exceed $4,000,000,000,
as of March 31, 1995; and
(ii) that had been, or is a successor by
merger, acquisition, or otherwise to an in-
stitution that had been, a State savings
bank, the deposits of which were insured
by the Federal Deposit Insurance Corpora-
tion before August 9, 1989, that converted
to a Federal savings association pursuant
214
to section 5(i) of the Home Owners’ Loan
Act before January 1, 1985;
(B) a State depository institution that is a
member of the Savings Association Insurance
Fund that had been a State savings bank be-
fore October 15, 1982, and was a Federal sav-
ings association on August 9, 1989;
(C) an insured bank that—
(i) was established de novo in order to
acquire the deposits of a savings associa-
tion in default or in danger of default;
(ii) did not open for business before
acquiring the deposits of such savings as-
sociation; and
(iii) was a Savings Association Insur-
ance Fund member before the date of en-
actment of this Act; and
(D) an insured bank that—
(i) resulted from a savings association
before December 19, 1991, in accordance
with section 5(d)(2)(G) of the Federal De-
posit Insurance Act; and
(ii) had an increase in its capital in
conjunction with the conversion in an
amount equal to more than 75 percent of
215
the capital of the institution on the day be-
fore the date of the conversion.
(k) EXEMPTION FOR CERTAIN INSTITUTIONS PAYING
EXIT AND ENTRANCE FEES.—The Board of Directors of
the Federal Deposit Insurance Corporation may, in the
sole discretion of the Board of Directors, exempt any in-
sured depository institution from paying the special as-
sessment imposed under subsection (a) if—
(1) the institution participated in a conversion
transaction pursuant to section 5(d)(2)(C) of the
Federal Deposit Insurance Act during the period be-
ginning on March 31, 1995, and ending on the date
of the enactment of this Act;
(2) exit and entrance fees have been assessed in
connection with such conversion transaction in ac-
cordance with subparagraphs (E) and (F) of section
5(d)(2) of the Federal Deposit Insurance Act; and
(3) as of the date of the enactment of this Act,
the institution—
(A) has paid, in whole or in part, the
amount of such exit and entrance fees; and
(B) is obligated to pay the balance of any
unpaid portion of any such fee in accordance
with a schedule agreed to by such Corporation.
216
(l) TREATMENT
OF EXISTING INSURED INSTITU-
TIONS FOR PURPOSES OF STATE AGE LAWS.—Section
3(d)(1)(B) of the Bank Holding Company Act of 1956
(12 U.S.C. 1842(d)(1)(B)) is amended by adding at the
end the following new clause:
‘‘(iii) INAPPLICABILITY
TO
CONVER-
SIONS
OF
INSURED
INSTITUTIONS.—Not-
withstanding clause (i), the Board may ap-
prove, pursuant to subparagraph (A), the
acquisition of a bank which has been
formed as the result of the conversion of
an existing insured institution subsidiary
of a savings and loan holding company to
a bank charter, if the existing insured de-
pository institution subsidiary, directly or
through 1 or more predecessor insured in-
stitutions (whether by merger, acquisition,
or otherwise), has been in existence for at
least 5 years before such acquisition.’’.
(m) DEPOSIT OF FEES INTO SAIF.—
(1) IN GENERAL.—Section 5(d)(2)(E)(i) of the
Federal 
Deposit 
Insurance 
Act 
(12 
U.S.C.
1815(d)(2)(E)(i)) is amended by striking ‘‘subpara-
graph (F)) which—’’ and all that follows through
the semicolon at the end and inserting ‘‘subpara-
217
graph (F)) which shall be deposited in the Savings
Association Insurance Fund before the calculation of
the special assessment under section 802 of the De-
posit Insurance Funds Act of 1996;’’.
(2) TREATMENT OF PRIOR FEES.—All fees col-
lected by the Federal Deposit Insurance Corporation
pursuant to section 5(d)(2)(E)(i) of the Federal De-
posit Insurance Act before the date of the enactment
of this Act which are held by the Corporation as of
such date shall be deposited in the Savings Associa-
tion Insurance Fund in accordance with such sec-
tion, as amended by paragraph (1) of this sub-
section.
SEC. 803. FINANCING CORPORATION FUNDING.
(a) IN GENERAL.—Section 21 of the Federal Home
Loan Bank Act (12 U.S.C. 1441) is amended—
(1) in subsection (f)(2)—
(A) in the matter immediately preceding
subparagraph (A)—
(i) by striking ‘‘To the extent the
amounts available pursuant to paragraph
(1) are insufficient to cover the amount of
interest payments, issuance costs, and cus-
todial fees,’’ and inserting ‘‘In addition to
218
the amounts obtained pursuant to para-
graph (1),’’;
(ii) by striking ‘‘Savings Association
Insurance Fund member’’ and inserting
‘‘insured depository institution’’; and
(iii) by striking ‘‘members’’ and in-
serting ‘‘institutions’’; and
(B) by striking ‘‘, except that—’’ and all
that follows through the end of the paragraph
and inserting ‘‘, except that—
‘‘(A) the assessments imposed on insured
depository institutions with respect to any BIF-
assessable deposit shall be assessed at a rate
equal to 1⁄5 of the rate of the assessments im-
posed on insured depository institutions with
respect to any SAIF-assessable deposit; and
‘‘(B) no limitation under clause (i) or (iii)
of section 7(b)(2)(A) of the Federal Deposit In-
surance Act shall apply for purposes of this
paragraph.’’; and
(2) in subsection (k)—
(A) by striking ‘‘section—’’ and inserting
‘‘section, the following definitions shall apply:’’;
(B) by striking paragraph (1);
219
(C) by redesignating paragraphs (2) and
(3) as paragraphs (1) and (2), respectively; and
(D) by adding at the end the following new
paragraphs:
‘‘(3) INSURED DEPOSITORY INSTITUTION.—The
term ‘insured depository institution’ has the same
meaning as in section 3 of the Federal Deposit In-
surance Act
‘‘(4) DEPOSIT TERMS.—
‘‘(A) BIF-ASSESSABLE
DEPOSITS.—The
term ‘BIF-assessable deposit’ means a deposit
that is subject to assessment for purposes of
the Bank Insurance Fund under the Federal
Deposit Insurance Act (including a deposit that
is treated as a deposit insured by the Bank In-
surance Fund under section 5(d)(3) of the Fed-
eral Deposit Insurance Act).
‘‘(B) SAIF-ASSESSABLE
DEPOSIT.—The
term ‘SAIF-assessable deposit’ has the meaning
given to such term in section 810 of the De-
posit Insurance Funds Act of 1996.’’.
(b) CONFORMING AMENDMENT.—Section 7(b)(2) of
the Federal Deposit Insurance Act (12 U.S.C. 1817(b)(2))
is amended by striking subparagraph (D).
(c) EFFECTIVE DATE.—
220
(1) IN GENERAL.—Subsections (a) and (c) and
the amendments made by such subsections shall
apply with respect to semiannual periods which
begin after December 31, 1996.
(2) TERMINATION
OF
CERTAIN
ASSESSMENT
RATES.—Subparagraph (A) of section 21(f)(2) of
the Federal Home Loan Bank Act (as amended by
subsection (a)) shall not apply after the earlier of—
(A) December 31, 1999; or
(B) the date as of which the last savings
association ceases to exist.
(d) PROHIBITION ON DEPOSIT SHIFTING.—
(1) IN GENERAL.—Effective as of the date of
the enactment of this Act and ending on the date
provided in subsection (c)(2) of this section, the
Comptroller of the Currency, the Board of Directors
of the Federal Deposit Insurance Corporation, the
Board of Governors of the Federal Reserve System,
and the Director of the Office of Thrift Supervision
shall take such actions as are necessary, including
enforcement actions, denial of applications, or impo-
sition of entrance and exit fees as if such trans-
actions qualified as conversion transactions pursuant
to section 5(d) of the Federal Deposit Insurance
Act, to prevent insured depository institutions and
221
depository institution holding companies from facili-
tating or encouraging the shifting of deposits from
SAIF-assessable deposits to BIF-assessable deposits
(as defined in section 21(k) of the Federal Home
Loan Bank Act) for the purpose of evading the as-
sessments imposed on insured depository institutions
with respect to SAIF-assessable deposits under sec-
tion 7(b) of the Federal Deposit Insurance Act and
section 21(f)(2) of the Federal Home Loan Bank
Act.
(2) REGULATIONS.—The Board of Directors of
the Federal Deposit Insurance Corporation may
issue regulations, including regulations defining
terms used in paragraph (1), to prevent the shifting
of deposits described in such paragraph.
(3) RULE OF CONSTRUCTION.—No provision of
this subsection shall be construed as prohibiting con-
duct or activity of any insured depository institution
which—
(A) is undertaken in the ordinary course of
business of such depository institution; and
(B) is not directed towards the depositors
of an insured depository institution affiliate (as
defined in section 2(k) of the Financial Services
222
Holding Company Act of 1996) of such deposi-
tory institution.
SEC. 804. MERGER OF BIF AND SAIF.
(a) IN GENERAL.—
(1) MERGER.—The Bank Insurance Fund and
the Savings Association Insurance Fund shall be
merged into the Deposit Insurance Fund established
by section 11(a)(4) of the Federal Deposit Insurance
Act, as amended by this section.
(2) DISPOSITION
OF
ASSETS
AND
LIABIL-
ITIES.—All assets and liabilities of the Bank Insur-
ance Fund and the Savings Association Insurance
Fund shall be transferred to the Deposit Insurance
Fund.
(3) NO SEPARATE EXISTENCE.—The separate
existence of the Bank Insurance Fund and the Sav-
ings Association Insurance Fund shall cease.
(b) SPECIAL RESERVE OF THE DEPOSIT INSURANCE
FUND.—
(1) IN
GENERAL.—Immediately before the
merger of the Bank Insurance Fund and the Sav-
ings Association Insurance Fund, if the reserve ratio
of the Savings Association Insurance Fund exceeds
the designated reserve ratio, the amount by which
that reserve ratio exceeds the designated reserve
223
ratio shall be placed in the Special Reserve of the
Deposit Insurance Fund, established under section
11(a)(5) of the Federal Deposit Insurance Act, as
amended by this section.
(2) DEFINITION.—For purposes of this sub-
section, the term ‘‘reserve ratio’’ means the ratio of
the net worth of the Savings Association Insurance
Fund to the aggregate estimated amount of deposits
insured by the Savings Association Insurance Fund.
(c) EFFECTIVE DATE.—This section and the amend-
ments made by this section shall become effective on Janu-
ary 1, 1999, if no insured depository institution is a sav-
ings association on that date.
(d) TECHNICAL AND CONFORMING AMENDMENTS.—
(1) 
DEPOSIT
INSURANCE
FUND.—Section
11(a)(4) of the Federal Deposit Insurance Act (12
U.S.C. 1821(a)(4)) is amended—
(A) by redesignating subparagraph (B) as
subparagraph (C);
(B) by striking subparagraph (A) and in-
serting the following:
‘‘(A) ESTABLISHMENT.—There is estab-
lished the Deposit Insurance Fund, which the
Corporation shall—
‘‘(i) maintain and administer;
224
‘‘(ii) use to carry out its insurance
purposes in the manner provided by this
subsection; and
‘‘(iii) invest in accordance with section
13(a).
‘‘(B) USES.—The Deposit Insurance Fund
shall be available to the Corporation for use
with respect to Deposit Insurance Fund mem-
bers.’’; and
(C) by striking ‘‘(4) GENERAL PROVISIONS
RELATING TO FUNDS.—’’ and inserting the fol-
lowing:
‘‘(4) ESTABLISHMENT OF THE DEPOSIT INSUR-
ANCE FUND.—’’.
(2) OTHER REFERENCES.—Section 11(a)(4)(C)
of the Federal Deposit Insurance Act (12 U.S.C.
1821(a)(4)(C), as redesignated by paragraph (1) of
this subsection) is amended by striking ‘‘Bank In-
surance Fund and the Savings Association Insur-
ance Fund’’ and inserting ‘‘Deposit Insurance
Fund’’.
(3) DEPOSITS INTO FUND.—Section 11(a)(4) of
the Federal Deposit Insurance Act (12 U.S.C.
1821(a)(4)) is amended by adding at the end the
following new subparagraph:
225
‘‘(D) DEPOSITS.—All amounts assessed
against insured depository institutions by the
Corporation shall be deposited in the Deposit
Insurance Fund.’’.
(4) SPECIAL RESERVE OF DEPOSITS.—Section
11(a)(5) of the Federal Deposit Insurance Act (12
U.S.C. 1821(a)(5)) is amended to read as follows:
‘‘(5) SPECIAL
RESERVE
OF
DEPOSIT
INSUR-
ANCE FUND.—
‘‘(A) ESTABLISHMENT.—
‘‘(i) IN
GENERAL.—There is estab-
lished a Special Reserve of the Deposit In-
surance Fund, which shall be administered
by the Corporation and shall be invested in
accordance with section 13(a).
‘‘(ii) LIMITATION.—The Corporation
shall not provide any assessment credit, re-
fund, or other payment from any amount
in the Special Reserve.
‘‘(B) EMERGENCY
USE
OF
SPECIAL
RE-
SERVE.—Notwithstanding subparagraph (A)(ii),
the Corporation may, in its sole discretion,
transfer amounts from the Special Reserve to
the Deposit Insurance Fund, for the purposes
set forth in paragraph (4), only if—
226
‘‘(i) the reserve ratio of the Deposit
Insurance Fund is less than 50 percent of
the designated reserve ratio; and
‘‘(ii) the Corporation expects the re-
serve ratio of the Deposit Insurance Fund
to remain at less than 50 percent of the
designated reserve ratio for each of the
next 4 calendar quarters.
‘‘(C) EXCLUSION OF SPECIAL RESERVE IN
CALCULATING RESERVE RATIO.—Notwithstand-
ing any other provision of law, any amounts in
the Special Reserve shall be excluded in cal-
culating the reserve ratio of the Deposit Insur-
ance Fund under section 7.’’.
(5) FEDERAL HOME LOAN BANK ACT.—Section
21B(f)(2)(C)(ii) of the Federal Home Loan Bank
Act (12 U.S.C. 1441b(f)(2)(C)(ii)) is amended—
(A) in subclause (I), by striking ‘‘to Sav-
ings Associations Insurance Fund members’’
and inserting ‘‘to insured depository institu-
tions, and their successors, which were Savings
Association Insurance Fund members on Sep-
tember 1, 1995’’; and
(B) in subclause (II), by striking ‘‘to Sav-
ings Associations Insurance Fund members’’
227
and inserting ‘‘to insured depository institu-
tions, and their successors, which were Savings
Association Insurance Fund members on Sep-
tember 1, 1995’’.
(6) REPEALS.—
(A) SECTION 3.—Section 3(y) of the Fed-
eral Deposit Insurance Act (12 U.S.C. 1813(y))
is amended to read as follows:
‘‘(y) DEFINITIONS RELATING TO THE DEPOSIT IN-
SURANCE FUND.—
‘‘(1) DEPOSIT
INSURANCE
FUND.—The term
‘Deposit Insurance Fund’ means the fund estab-
lished under section 11(a)(4).
‘‘(2) RESERVE RATIO.—The term ‘reserve ratio’
means the ratio of the net worth of the Deposit In-
surance Fund to aggregate estimated insured depos-
its held in all insured depository institutions.
‘‘(3) DESIGNATED RESERVE RATIO.—The des-
ignated reserve ratio of the Deposit Insurance Fund
for each year shall be—
‘‘(A) 1.25 percent of estimated insured de-
posits; or
‘‘(B) a higher percentage of estimated in-
sured deposits that the Board of Directors de-
termines to be justified for that year by cir-
228
cumstances raising a significant risk of sub-
stantial future losses to the fund.
(B) SECTION 7.—Section 7 of the Federal
Deposit Insurance Act (12 U.S.C. 1817) is
amended—
(i) by striking subsection (l);
(ii) by redesignating subsections (m)
and (n) as subsections (l) and (m), respec-
tively;
(iii) in subsection (b)(2), by striking
subparagraphs (B) and (F), and by redes-
ignating subparagraphs (C), (E), (G), and
(H) as subparagraphs (B) through (E), re-
spectively.
(C) SECTION
11.—Section 11(a) of the
Federal Deposit Insurance Act (12 U.S.C.
1821(a)) is amended—
(i) by striking paragraphs (6) and (7);
and
(ii) by redesignating paragraph (8) as
paragraph (6).
(7) SECTION
5136
OF
THE
REVISED
STAT-
UTES.—The paragraph designated the ‘‘Eleventh’’ of
section 5136 of the Revised Statutes (12 U.S.C. 24)
is amended in the fifth sentence, by striking ‘‘af-
229
fected deposit insurance fund’’ and inserting ‘‘De-
posit Insurance Fund’’.
(8) INVESTMENTS
PROMOTING
PUBLIC
WEL-
FARE; 
LIMITATIONS
ON
AGGREGATE
INVEST-
MENTS.—The twenty-third undesignated paragraph
of section 9 of the Federal Reserve Act (12 U.S.C.
338a) is amended in the 4th sentence, by striking
‘‘affected deposit insurance fund’’ and inserting
‘‘Deposit Insurance Fund’’.
(9) ADVANCES TO CRITICALLY UNDERCAPITAL-
IZED
DEPOSITORY
INSTITUTIONS.—Section
10B(b)(3)(A)(ii) of the Federal Reserve Act (12
U.S.C. 347b(b)(3)(A)(ii)) is amended by striking
‘‘any deposit insurance fund in’’ and inserting ‘‘the
Deposit Insurance Fund of’’.
(10) AMENDMENTS TO THE BALANCED BUDGET
AND EMERGENCY DEFICIT CONTROL ACT OF 1985.—
Section 255(g)(1)(A) of the Balanced Budget and
Emergency Deficit Control Act of 1985 (2 U.S.C.
905(g)(1)(A)) is amended—
(A) by striking ‘‘Bank Insurance Fund’’
and inserting ‘‘Deposit Insurance Fund’’; and
(B) by striking ‘‘Federal Deposit Insur-
ance Corporation, Savings Association Insur-
ance Fund;’’.
230
(11) FURTHER AMENDMENTS TO THE FEDERAL
HOME LOAN BANK ACT.—The Federal Home Loan
Bank Act (12 U.S.C. 1421 et seq.) is amended—
(A) 
in 
section 
11(k) 
(12 
U.S.C.
1431(k))—
(i) in the subsection heading, by strik-
ing ‘‘SAIF’’ and inserting ‘‘THE DEPOSIT
INSURANCE FUND’’; and
(ii) by striking ‘‘Savings Association
Insurance Fund’’ each place such term ap-
pears and inserting ‘‘Deposit Insurance
Fund’’;
(B) in section 21A(b)(4)(B) (12 U.S.C.
1441a(b)(4)(B)), by striking ‘‘affected deposit
insurance fund’’ and inserting ‘‘Deposit Insur-
ance Fund’’;
(C) in section 21A(b)(6)(B) (12 U.S.C.
1441a(b)(6)(B))—
(i) in the subparagraph heading, by
striking ‘‘SAIF-INSURED BANKS’’ and in-
serting ‘‘CHARTER CONVERSIONS’’; and
(ii) by striking ‘‘Savings Association
Insurance Fund member’’ and inserting
‘‘savings association’’;
231
(D) in section 21A(b)(10)(A)(iv)(II) (12
U.S.C. 1441a(b)(10)(A)(iv)(II)), by striking
‘‘Savings Association Insurance Fund’’ and in-
serting ‘‘Deposit Insurance Fund’’;
(E) 
in 
section 
21B(e) 
(12 
U.S.C.
1441b(e))—
(i) in paragraph (5), by inserting ‘‘as
of the date of funding’’ after ‘‘Savings As-
sociation Insurance Fund members’’ each
place such term appears;
(ii) by striking paragraph (7); and
(iii) by redesignating paragraph (8) as
paragraph (7); and
(F) 
in 
section 
21B(k) 
(12 
U.S.C.
1441b(k))—
(i) by striking paragraph (8); and
(ii) by redesignating paragraphs (9)
and (10) as paragraphs (8) and (9), re-
spectively.
(12) AMENDMENTS
TO
THE
HOME
OWNERS’
LOAN
ACT.—The Home Owners’ Loan Act (12
U.S.C. 1461 et seq.) is amended—
(A) in section 5—
232
(i) in subsection (c)(5)(A), by striking
‘‘that is a member of the Bank Insurance
Fund’’;
(ii) in subsection (c)(6), by striking
‘‘As used in this subsection—’’ and insert-
ing ‘‘For purposes of this subsection, the
following definitions shall apply:’’;
(iii) in subsection (o)(1), by striking
‘‘that is a Bank Insurance Fund member’’;
(iv) in subsection (o)(2)(A), by strik-
ing ‘‘a Bank Insurance Fund member until
such time as it changes its status to a Sav-
ings Association Insurance Fund member’’
and inserting ‘‘insured by the Deposit In-
surance Fund’’;
(v) in subsection (t)(5)(D)(iii)(II), by
striking ‘‘affected deposit insurance fund’’
and inserting ‘‘Deposit Insurance Fund’’;
(vi) in subsection (t)(7)(C)(i)(I), by
striking ‘‘affected deposit insurance fund’’
and inserting ‘‘Deposit Insurance Fund’’;
and
(vii) in subsection (v)(2)(A)(i), by
striking ‘‘, the Savings Association Insur-
233
ance Fund’’ and inserting ‘‘or the Deposit
Insurance Fund’’; and
(B) in section 10—
(i) in subsection (e)(1)(A)(iii)(VII), by
adding ‘‘or’’ at the end;
(ii) in subsection (e)(1)(A)(iv), by
adding ‘‘and’’ at the end;
(iii) in subsection (e)(1)(B), by strik-
ing ‘‘Savings Association Insurance Fund
or Bank Insurance Fund’’ and inserting
‘‘Deposit Insurance Fund’’;
(iv) in subsection (e)(2), by striking
‘‘Savings Association Insurance Fund or
the Bank Insurance Fund’’ and inserting
‘‘Deposit Insurance Fund’’; and
(v) in subsection (m)(3), by striking
subparagraph (E), and by redesignating
subparagraphs (F), (G), and (H) as sub-
paragraphs (E), (F), and (G), respectively.
(13) AMENDMENTS TO THE NATIONAL HOUSING
ACT.—The National Housing Act (12 U.S.C. 1701
et seq.) is amended—
(A) in section 317(b)(1)(B) (12 U.S.C.
1723i(b)(1)(B)), by striking ‘‘Bank Insurance
Fund for banks or through the Savings Asso-
234
ciation Insurance Fund for savings associa-
tions’’ and inserting ‘‘Deposit Insurance Fund’’;
and
(B) in section 526(b)(1)(B)(ii) (12 U.S.C.
1735f–14(b)(1)(B)(ii)), by striking ‘‘Bank In-
surance Fund for banks and through the Sav-
ings Association Insurance Fund for savings as-
sociations’’ and inserting ‘‘Deposit Insurance
Fund’’.
(14) FURTHER AMENDMENTS TO THE FEDERAL
DEPOSIT INSURANCE ACT.—The Federal Deposit In-
surance Act (12 U.S.C. 1811 et seq.) is amended—
(A) 
in 
section 
3(a)(1) 
(12 
U.S.C.
1813(a)(1)), by striking subparagraph (B) and
inserting the following:
‘‘(B) includes any former savings associa-
tion.’’;
(B) 
in 
section 
5(b)(5) 
(12 
U.S.C.
1815(b)(5)), by striking ‘‘the Bank Insurance
Fund or the Savings Association Insurance
Fund;’’ and inserting ‘‘Deposit Insurance
Fund,’’;
(C) in section 5(d) (12 U.S.C. 1815(d)),
by striking paragraphs (2) and (3);
235
(D) 
in 
section 
5(d)(1) 
(12 
U.S.C.
1815(d)(1))—
(i) in subparagraph (A), by striking
‘‘reserve ratios in the Bank Insurance
Fund and the Savings Association Insur-
ance Fund’’ and inserting ‘‘the reserve
ratio of the Deposit Insurance Fund’’;
(ii) by striking subparagraph (B) and
inserting the following:
‘‘(2) FEE CREDITED TO THE DEPOSIT INSUR-
ANCE FUND.—The fee paid by the depository insti-
tution under paragraph (1) shall be credited to the
Deposit Insurance Fund.’’;
(iii) by striking ‘‘(1) UNINSURED IN-
STITUTIONS.—’’; and
(iv) by redesignating subparagraphs
(A) and (C) as paragraphs (1) and (3), re-
spectively, and moving the margins 2 ems
to the left;
(E) in section 5(e) (12 U.S.C. 1815(e))—
(i) in paragraph (5)(A), by striking
‘‘Bank Insurance Fund or the Savings As-
sociation Insurance Fund’’ and inserting
‘‘Deposit Insurance Fund’’;
(ii) by striking paragraph (6); and
236
(iii) by redesignating paragraphs (7),
(8), and (9) as paragraphs (6), (7), and
(8), respectively;
(F) in section 6(5) (12 U.S.C. 1816(5)),
by striking ‘‘Bank Insurance Fund or the Sav-
ings Association Insurance Fund’’ and inserting
‘‘Deposit Insurance Fund’’;
(G) in section 7(b) (12 U.S.C. 1817(b))—
(i) in paragraph (1)(D), by striking
‘‘each deposit insurance fund’’ and insert-
ing ‘‘the Deposit Insurance Fund’’;
(ii) in clauses (i)(I) and (iv) of para-
graph (2)(A), by striking ‘‘each deposit in-
surance fund’’ each place such term ap-
pears and inserting ‘‘the Deposit Insurance
Fund’’;
(iii) in paragraph (2)(A)(iii), by strik-
ing ‘‘a deposit insurance fund’’ and insert-
ing ‘‘the Deposit Insurance Fund’’;
(iv) by striking clause (iv) of para-
graph (2)(A);
(v) in paragraph (2)(C) (as redesig-
nated by paragraph (6)(B) of this sub-
section)—
237
(I) by striking ‘‘any deposit in-
surance fund’’ and inserting ‘‘the De-
posit Insurance Fund’’; and
(II) by striking ‘‘that fund’’ each
place such term appears and inserting
‘‘the Deposit Insurance Fund’’;
(vi) in paragraph (2)(D) (as redesig-
nated by paragraph (6)(B) of this sub-
section)—
(I) in the subparagraph heading,
by striking ‘‘FUNDS ACHIEVE’’ and in-
serting ‘‘FUND ACHIEVES’’; and
(II) by striking ‘‘a deposit insur-
ance fund’’ and inserting ‘‘the Deposit
Insurance Fund’’;
(vii) in paragraph (3)—
(I) in the paragraph heading, by
striking 
‘‘FUNDS’’ 
and 
inserting
‘‘FUND’’;
(II) by striking ‘‘members of that
fund’’ where such term appears in the
portion of subparagraph (A) which
precedes clause (i) of such subpara-
graph and inserting ‘‘insured deposi-
tory institutions’’;
238
(III) by striking ‘‘that fund’’
each place such term appears (other
than in connection with term amended
in subclause (II) of this clause) and
inserting 
‘‘the 
Deposit 
Insurance
Fund’’;
(IV) in subparagraph (A), by
striking ‘‘Except as provided in para-
graph (2)(F), if’’ and inserting ‘‘If’’;
(V) in subparagraph (A), by
striking ‘‘any deposit insurance fund’’
and inserting ‘‘the Deposit Insurance
Fund’’; and
(VI) by striking subparagraphs
(C) and (D) and inserting the follow-
ing:
‘‘(C) AMENDING
SCHEDULE.—The Cor-
poration may, by regulation, amend a schedule
promulgated under subparagraph (B).’’; and
(viii) in paragraph (6)—
(I) by striking ‘‘any such assess-
ment’’ and inserting ‘‘any such assess-
ment is necessary’’;
(II) by striking ‘‘(A) is nec-
essary—’’;
239
(III) by striking subparagraph
(B);
(IV) by redesignating clauses (i),
(ii), and (iii) as subparagraphs (A),
(B), and (C), respectively, and moving
the margins 2 ems to the left; and
(V) in subparagraph (C) (as re-
designated), by striking ‘‘; and’’ and
inserting a period;
(H) 
in 
section 
11(f)(1) 
(12 
U.S.C.
1821(f)(1)), by striking ‘‘, except that—’’ and
all that follows through the end of the para-
graph and inserting a period;
(I) 
in 
section 
11(i)(3) 
(12 
U.S.C.
1821(i)(3))—
(i) by striking subparagraph (B);
(ii) by redesignating subparagraph
(C) as subparagraph (B); and
(iii) in subparagraph (B) (as redesig-
nated), by striking ‘‘subparagraphs (A)
and (B)’’ and inserting ‘‘subparagraph
(A)’’;
(J) 
in 
section 
11A(a) 
(12 
U.S.C.
1821a(a))—
240
(i) in paragraph (2), by striking ‘‘LI-
ABILITIES.—’’ and all that follows through
‘‘Except’’ and inserting ‘‘LIABILITIES.—
Except’’;
(ii) by striking paragraph (2)(B); and
(iii) in paragraph (3), by striking ‘‘the
Bank Insurance Fund, the Savings Asso-
ciation Insurance Fund,’’ and inserting
‘‘the Deposit Insurance Fund’’;
(K) 
in 
section 
11A(b) 
(12 
U.S.C.
1821a(b)), by striking paragraph (4);
(L) 
in 
section 
11A(f) 
(12 
U.S.C.
1821a(f)), by striking ‘‘Savings Association In-
surance Fund’’ and inserting ‘‘Deposit Insur-
ance Fund’’;
(M) in section 13 (12 U.S.C. 1823)—
(i) in subsection (a)(1), by striking
‘‘Bank Insurance Fund, the Savings Asso-
ciation Insurance Fund,’’ and inserting
‘‘Deposit Insurance Fund, the Special Re-
serve of the Deposit Insurance Fund,’’;
(ii) in subsection (c)(4)(E)—
(I) in the subparagraph heading,
by striking ‘‘FUNDS’’ and inserting
‘‘FUND’’; and
241
(II) in clause (i), by striking
‘‘any insurance fund’’ and inserting
‘‘the Deposit Insurance Fund’’;
(iii) in subsection (c)(4)(G)(ii)—
(I) by striking ‘‘appropriate in-
surance fund’’ and inserting ‘‘Deposit
Insurance Fund’’;
(II) by striking ‘‘the members of
the insurance fund (of which such in-
stitution is a member)’’ and inserting
‘‘insured depository institutions’’;
(III) by striking ‘‘each mem-
ber’s’’ and inserting ‘‘each insured de-
pository institution’s’’; and
(IV) by striking ‘‘the member’s’’
each place such term appears and in-
serting ‘‘the institution’s’’;
(iv) in subsection (c), by striking
paragraph (11);
(v) in subsection (h), by striking
‘‘Bank Insurance Fund’’ and inserting
‘‘Deposit Insurance Fund’’;
(vi) in subsection (k)(4)(B)(i), by
striking ‘‘Savings Association Insurance
242
Fund’’ and inserting ‘‘Deposit Insurance
Fund’’; and
(vii) in subsection (k)(5)(A), by strik-
ing ‘‘Savings Association Insurance Fund’’
and inserting ‘‘Deposit Insurance Fund’’;
(N) in section 14(a) (12 U.S.C. 1824(a))
in the 5th sentence—
(i) by striking ‘‘Bank Insurance Fund
or the Savings Association Insurance
Fund’’ and inserting ‘‘Deposit Insurance
Fund’’; and
(ii) by striking ‘‘each such fund’’ and
inserting ‘‘the Deposit Insurance Fund’’;
(O) in section 14(b) (12 U.S.C. 1824(b)),
by striking ‘‘Bank Insurance Fund or Savings
Association Insurance Fund’’ and inserting
‘‘Deposit Insurance Fund’’;
(P) in section 14(c) (12 U.S.C. 1824(c)),
by striking paragraph (3);
(Q) 
in 
section 
14(d) 
(12 
U.S.C.
1824(d))—
(i) by striking ‘‘BIF’’ each place such
term appears and inserting ‘‘DIF’’; and
243
(ii) by striking ‘‘Bank Insurance
Fund’’ each place such term appears and
inserting ‘‘Deposit Insurance Fund’’;
(R) 
in 
section 
15(c)(5) 
(12 
U.S.C.
1825(c)(5))—
(i) by striking ‘‘the Bank Insurance
Fund or Savings Association Insurance
Fund, respectively’’ each place such term
appears and inserting ‘‘the Deposit Insur-
ance Fund’’; and
(ii) in subparagraph (B), by striking
‘‘the Bank Insurance Fund or the Savings
Association Insurance Fund, respectively’’
and inserting ‘‘the Deposit Insurance
Fund’’;
(S) in section 17(a) (12 U.S.C. 1827(a))—
(i) in the subsection heading, by strik-
ing ‘‘BIF, SAIF,’’ and inserting ‘‘THE DE-
POSIT INSURANCE FUND’’; and
(ii) in paragraph (1), by striking ‘‘the
Bank Insurance Fund, the Savings Asso-
ciation Insurance Fund,’’ each place such
term appears and inserting ‘‘the Deposit
Insurance Fund’’;
244
(T) in section 17(d) (12 U.S.C. 1827(d)),
by striking ‘‘the Bank Insurance Fund, the
Savings Association Insurance Fund,’’ each
place such term appears and inserting ‘‘the De-
posit Insurance Fund’’;
(U) in section 18(m)(3) (12 U.S.C.
1828(m)(3))—
(i) by striking ‘‘Savings Association
Insurance Fund’’ each place such term ap-
pears and inserting ‘‘Deposit Insurance
Fund’’; and
(ii) in subparagraph (C), by striking
‘‘or the Bank Insurance Fund’’;
(V) in section 18(p) (12 U.S.C. 1828(p)),
by striking ‘‘deposit insurance funds’’ and in-
serting ‘‘Deposit Insurance Fund’’;
(W) in section 24 (12 U.S.C. 1831a) in
subsections (a)(1) and (d)(1)(A), by striking
‘‘appropriate deposit insurance fund’’ each
place such term appears and inserting ‘‘Deposit
Insurance Fund’’;
(X) in section 28 (12 U.S.C. 1831e), by
striking ‘‘affected deposit insurance fund’’ each
place such term appears and inserting ‘‘Deposit
Insurance Fund’’;
245
(Y) by striking section 31 (12 U.S.C.
1831h);
(Z) 
in 
section 
36(i)(3) 
(12 
U.S.C.
1831m(i)(3)) by striking ‘‘affected deposit in-
surance fund’’ and inserting ‘‘Deposit Insur-
ance Fund’’;
(AA) 
in 
section 
38(a) 
(12 
U.S.C.
1831o(a)) in the subsection heading, by striking
‘‘FUNDS’’ and inserting ‘‘FUND’’;
(BB) 
in 
section 
38(k) 
(12 
U.S.C.
1831o(k))—
(i) in paragraph (1), by striking ‘‘a
deposit insurance fund’’ and inserting ‘‘the
Deposit Insurance Fund’’; and
(ii) in paragraph (2)(A)—
(I) by striking ‘‘A deposit insur-
ance fund’’ and inserting ‘‘The De-
posit Insurance Fund’’; and
(II) by striking ‘‘the deposit in-
surance fund’s outlays’’ and inserting
‘‘the outlays of the Deposit Insurance
Fund’’; and
(CC) 
in 
section 
38(o) 
(12 
U.S.C.
1831o(o))—
246
(i) by striking ‘‘ASSOCIATIONS.—’’
and all that follows through ‘‘Subsections
(e)(2)’’ and inserting ‘‘ASSOCIATIONS.—
Subsections (e)(2)’’;
(ii) by redesignating subparagraphs
(A), (B), and (C) as paragraphs (1), (2),
and (3), respectively, and moving the mar-
gins 2 ems to the left; and
(iii) in paragraph (1) (as redesig-
nated), by redesignating clauses (i) and (ii)
as subparagraphs (A) and (B), respec-
tively, and moving the margins 2 ems to
the left.
(15) AMENDMENTS TO THE FINANCIAL INSTI-
TUTIONS REFORM, RECOVERY, AND ENFORCEMENT
ACT OF 1989.—The Financial Institutions Reform,
Recovery, and Enforcement Act is amended—
(A) in section 951(b)(3)(B) (12 U.S.C.
1833a(b)(3)(B)), by striking ‘‘Bank Insurance
Fund, 
the 
Savings 
Association 
Insurance
Fund,’’ and inserting ‘‘Deposit Insurance
Fund’’; and
(B) in section 1112(c)(1)(B) (12 U.S.C.
3341(c)(1)(B)), by striking ‘‘Bank Insurance
Fund, 
the 
Savings 
Association 
Insurance
247
Fund,’’ and inserting ‘‘Deposit Insurance
Fund’’.
(16) AMENDMENT TO THE BANK ENTERPRISE
ACT OF 1991.—Section 232(a)(1) of the Bank Enter-
prise Act of 1991 (12 U.S.C. 1834(a)(1)) is amend-
ed by striking ‘‘section 7(b)(2)(H)’’ and inserting
‘‘section 7(b)(2)(G)’’.
(17) AMENDMENT
TO
THE
BANK
HOLDING
COMPANY ACT.—Section 2(j)(2) of the Bank Hold-
ing Company Act of 1956 (12 U.S.C. 1841(j)(2)) is
amended by striking ‘‘Savings Association Insurance
Fund’’ and inserting ‘‘Deposit Insurance Fund’’.
SEC. 805. CREATION OF SAIF SPECIAL RESERVE.
Section 11(a)(6) of the Federal Deposit Insurance
Act (12 U.S.C. 1821(a)(6)) is amended by adding at the
end the following new subparagraph:
‘‘(L) ESTABLISHMENT
OF
SAIF
SPECIAL
RE-
SERVE.—
‘‘(i) ESTABLISHMENT.—If, on January 1,
1999, the reserve ratio of the Savings Associa-
tion Insurance Fund exceeds the designated re-
serve ratio, there is established a Special Re-
serve of the Savings Association Insurance
Fund, which shall be administered by the Cor-
248
poration and shall be invested in accordance
with section 13(a).
‘‘(ii) AMOUNTS IN SPECIAL RESERVE.—If,
on January 1, 1999, the reserve ratio of the
Savings Association Insurance Fund exceeds
the designated reserve ratio, the amount by
which the reserve ratio exceeds the designated
reserve ratio shall be placed in the Special Re-
serve of the Savings Association Insurance
Fund established by clause (i).
‘‘(iii) LIMITATION.—The Corporation shall
not provide any assessment credit, refund, or
other payment from any amount in the Special
Reserve of the Savings Association Insurance
Fund.
‘‘(iv) EMERGENCY
USE
OF
SPECIAL
RE-
SERVE.—Notwithstanding clause (iii), the Cor-
poration may, in its sole discretion, transfer
amounts from the Special Reserve of the Sav-
ings Association Insurance Fund to the Savings
Association Insurance Fund for the purposes
set forth in paragraph (4), only if—
‘‘(I) the reserve ratio of the Savings
Association Insurance Fund is less than 50
percent of the designated reserve ratio; and