approve an application under paragraph (1) or (2)
by a national bank to acquire or establish a branch
only if—
‘‘(A) the national bank is adequately cap-
italized (as defined under section 38 of the Fed-
eral Deposit Insurance Act) as of the date the
application is filed; and
‘‘(B) the Comptroller of the Currency deter-
mines that—
‘‘(i) the national bank will continue to
be adequately capitalized upon the con-
summation of the acquisition or establish-
ment of the branch; and
‘‘(ii) on the basis of an evaluation con-
ducted by the Comptroller, the management
of the bank has the necessary management
skills to manage the operations of the bank
upon the consummation of the acquisition
or establishment of the branch.
‘‘(e) PROVISIONS APPLICABLE TO APPLICATION AND
APPROVAL PROCESS.—
‘‘(1) CONSULTATION WITH STATE BANK SUPER-
VISOR.—In determining whether to grant approval of
an application under subsection (d), the Comptroller
of the Currency shall consider the views of any appro-
priate State bank supervisor of the bank which sub-
mits the application regarding the bank’s compliance
with applicable State community reinvestment laws.
‘‘(2) COMPLIANCE WITH STATE FILING REQUIRE-
MENTS.—
‘‘(A) IN
GENERAL.—An out-of-State na-
tional bank that files an application under sub-
section (d) to acquire or establish a branch with-
in a host State shall—
‘‘(i) comply with any filing require-
ment of the host State that—
‘‘(I) is not discriminatory in na-
ture; and
‘‘(II) is similar in effect to any
requirement imposed by the host State
on a nonbanking corporation from an-
other State that seeks to engage in
business in the host State; and
‘‘(ii) submit a copy of the application
to the State bank supervisor of the host
State.
‘‘(B) PENALTY FOR FAILURE TO COMPLY.—
The Comptroller of the Currency may not ap-
prove an application under subsection (d) by an
out-of-State national bank which materially fails
to comply with subparagraph (A) with respect to
such application.
‘‘(3) CONCENTRATION LIMITS.—
‘‘(A) IN GENERAL.—The Comptroller of the
Currency may not approve an application by a
bank under subsection (d) if—
‘‘(i) the bank (including all insured de-
pository institutions which are affiliates of
the bank) controls, or upon completion of
the acquisition would control, more than 10
percent of the total amount of insured de-
pository institution deposits in the United
States; or
‘‘(ii) the bank (including all insured
depository institutions which are affiliates
of the bank) controls, or upon completion of
the acquisition would control, 30 percent or
more of the total amount of insured deposi-
tory institution deposits in the State in
which the proposed branch would be located.
‘‘(B) NOT APPLICABLE TO DE NOVO OUT-OF-
STATE BRANCHES.—Subparagraph (A) shall not
apply to the establishment of a de novo branch
outside the home State of a national bank.
‘‘(C) WAIVER
BY
STATE.—A State may
waive the application of subparagraph (A)(ii) to
the acquisition of banks or branches in such
State.
‘‘(4) CONSIDERATION OF BANK AFFILIATES.—In
determining whether to grant approval of an applica-
tion under subsection (d) with respect to a proposed
branch by a national bank which, as of the date of
the application, does not have a branch in the host
State (of the proposed branch), the Comptroller of the
Currency shall take into account the most recent writ-
ten evaluation under section 807 of the Community
Reinvestment Act of 1977 of each bank affiliate of the
bank which submits the application.
‘‘(5) DEFINITIONS.—For purposes of this sub-
section and subsections (d) and (f) the following defi-
nitions shall apply:
‘‘(A) AFFILIATE.—The term ‘affiliate’ has
the same meaning as in section 2(k) of the Bank
Holding Company Act of 1956.
‘‘(B) ANTITRUST
LAWS.—The term ‘anti-
trust laws’—
‘‘(i) has the same meaning as in sub-
section (a) of the 1st section of the Clayton
Act; and
‘‘(ii) includes section 5 of the Federal
Trade Commission Act to the extent such
section 5 relates to unfair methods of com-
petition.
‘‘(C) DE NOVO BRANCH.—The term ‘de novo
branch’ means a branch of a national bank
which—
‘‘(i) is originally established by the na-
tional bank as a branch; and
‘‘(ii) does not become a branch of such
bank as a result of—
‘‘(I) the acquisition by the bank of
an insured depository institution or a
branch of an insured depository insti-
tution; or
‘‘(II) the conversion, merger, or
consolidation of any such institution
or branch.
‘‘(D) DEPOSITS.—The term ‘deposits’ has
the same meaning as in section 3(l) of the Fed-
eral Deposit Insurance Act.
‘‘(E) HOME STATE.—The term ‘home State’
means, with respect to a national bank, the State
in which the main office of the bank is located.
‘‘(4) STATE-IMPOSED NOTICE REQUIREMENTS.—
A host State may impose any notification or report-
ing requirement on a branch established or acquired
under subsection (d) if the requirement—
‘‘(A) does not discriminate against out-of-
State banks or bank holding companies; and
‘‘(B) is not preempted by any Federal law
regarding the same subject.
‘‘(5) APPLICABILITY OF DEPOSIT CAPS AND ANTI-
TRUST LAWS.—No provision of this subsection or sub-
section (d) or (e) shall be construed as affecting—
‘‘(A) the authority of any State to limit the
percentage of the total amount of insured deposi-
tory institution deposits in the State which may
be held or controlled by any bank (including all
insured depository institutions which are affili-
ates of the bank) to the extent the application of
such limitation does not discriminate against
out-of-State banks or bank holding companies; or
‘‘(B) the applicability of the antitrust laws
or any State law which is similar to the anti-
trust laws.’’; and
(3) in subsection (i) (as so redesignated by the
amendment made by paragraph (1) of this section),
by striking ‘‘The term’’ and inserting ‘‘BRANCH.—
Except as provided in section 18(q) of the Federal De-
posit Insurance Act, the term’’.
SEC. 103. INTERSTATE BRANCHING BY STATE BANKS.
(a) IN GENERAL.—The Federal Deposit Insurance Act
(12 U.S.C. 1811 et seq.) is amended by adding at the end
the following new section:
‘‘SEC. 44. STATE BANK BRANCHES.
‘‘(a) CONSENT OF CORPORATION.—
‘‘(1) ESTABLISHMENT OF BRANCHES.—No State
nonmember insured bank (except a District bank)
may establish and operate any new domestic branch
without the prior written consent of the Corporation.
‘‘(2) CHANGE OF LOCATION OF STATE BANK OF-
FICES AND BRANCHES.—No State nonmember insured
bank (except a District bank) may move the main of-
fice or any domestic branch of such bank from 1 loca-
tion to another without the prior written consent of
the Corporation.
‘‘(3) CHANGE OF LOCATION OF INSURED BRANCH
OF FOREIGN BANK.—No foreign bank may move any
insured branch from 1 location to another without the
prior written consent of the Corporation.
‘‘(4) FACTORS TO BE CONSIDERED.—The Cor-
poration shall consider the factors enumerated in sec-
tion 6 in making any determination under this sub-
section.
‘‘(b) ESTABLISHMENT OF FOREIGN BRANCHES.—
‘‘(1) IN GENERAL.—No State nonmember insured
bank shall establish or operate any foreign branch
without the prior written consent of the Corporation.
‘‘(2) CONDITIONS AND REGULATIONS.—The Cor-
poration may establish such conditions and prescribe
such regulations for the establishment and operation
of foreign branches of State nonmember banks as the
Corporation may determine to be appropriate.
‘‘(c) INTERSTATE BRANCHING BY STATE BANKS.—
‘‘(1) APPROVALS OF ACQUISITION OF EXISTING
BRANCHES AUTHORIZED.—Subject to paragraphs (3)
and (4) and subsections (d) and (e), after the end of
the 3-year period beginning on the date of the enact-
ment of the Interstate Banking Efficiency Act of
1994, the appropriate Federal banking agency may
approve an application under this section to allow an
insured State bank to—
‘‘(A) acquire a bank or branch located out-
side the home State of such bank in a State in
which the bank does not maintain a branch; and
‘‘(B) operate such bank or branch (includ-
ing any branch of such bank) as a branch,
if the conditions established in paragraph (6) are
met.
‘‘(2) STATE
‘OPT-IN’ 
ELECTION
TO
PERMIT
INTERSTATE
BRANCHING
THROUGH
DE
NOVO
BRANCHES.—Subject to subsections (d) and (e), the
appropriate Federal banking agency may approve an
application by a State bank to establish and operate
a de novo branch outside the home State of such bank
in a State in which the bank does not maintain a
branch if—
‘‘(A) there is in effect in the host State a
law that—
‘‘(i) expressly permits all out-of-State
banks to establish de novo branches in such
State; and
‘‘(ii) applies equally to national and
State banks; and
‘‘(B) the conditions established in para-
graph (6) are met.
‘‘(3) STATE ‘OPT-OUT’ ELECTION TO PROHIBIT
INTERSTATE BRANCHING BY ACQUISITION OF EXIST-
ING BANKS.—
‘‘(A) IN GENERAL.—An application by an
insured State bank to establish a branch in a
State other than the home State of such bank
through the acquisition of an existing bank or
branch in the host State may not be approved by
the appropriate Federal banking agency if there
is in effect in the host State a law which—
‘‘(i) expressly prohibits all out-of-State
banks from acquiring a branch located in
such State through the acquisition of an ex-
isting bank or branch in the host State;
‘‘(ii) was enacted during the period be-
ginning on January 1, 1990, and ending 3
years after the date of the enactment of the
Interstate Banking Efficiency Act of 1994;
and
‘‘(iii) applies equally to national and
State banks.
‘‘(B) EFFECT
OF
PROHIBITION.—An in-
sured State bank whose home State has in effect
a prohibition described in subparagraph (A)
may not acquire or establish, under subsection
(c), a branch located in any other State.
‘‘(4) STATE LAWS REQUIRING MINIMUM PERIOD
OF EXISTENCE FOR ACQUISITIONS BY OUT-OF-STATE
BANKS.—
‘‘(A) LAWS ENACTED BEFORE INTERSTATE
BANKING ACT.—In the case of a State in which
a law is in effect which—
‘‘(i) allows an out-of-State bank or
bank holding company to establish a bank
in the host State only by acquiring a bank
or branch (in the host State) which has been
in existence for not less than the minimum
time period specified in such law; and
‘‘(ii) took effect on or before the date of
the enactment of the Interstate Banking Ef-
ficiency Act of 1994,
an out-of-State insured State bank which has no
branch in such State may establish a branch in
the State under this subsection only by acquiring
a bank or branch which has been in existence for
not less than the minimum time period specified
in such law.
‘‘(B) SUBSEQUENT
ENACTMENTS.—In the
case of a State in which a law is in effect
which—
‘‘(i) allows an out-of-State bank or
bank holding company to establish a branch
in the host State only by acquiring a bank
or branch (in the host State) which has been
‘‘(A) the bank is adequately capitalized (as
defined under section 38) as of the date the ap-
plication is filed;
‘‘(B) the bank is authorized to establish
branches in other States under the law of the
home State of the bank; and
‘‘(C) the appropriate Federal banking agen-
cy determines that—
‘‘(i) the bank will continue to be ade-
quately capitalized upon the consummation
of the acquisition or establishment of the
branch; and
‘‘(ii) on the basis of an evaluation con-
ducted by the agency, the management of
the bank has the necessary management
skills to manage the operations of the bank
upon the consummation of the acquisition
or establishment of the branch.
‘‘(d) PROVISIONS APPLICABLE TO APPLICATION AND
APPROVAL PROCESS.—
‘‘(1) CONSULTATION WITH STATE BANK SUPER-
VISOR.—In determining whether to grant approval of
an application under subsection (c), the appropriate
Federal banking agency shall consider the views of
any appropriate State bank supervisor of the bank
which submits the application regarding the bank’s
compliance with applicable State community rein-
vestment laws.
‘‘(2) COMPLIANCE WITH STATE FILING REQUIRE-
MENTS.—
‘‘(A) IN GENERAL.—An out-of-State insured
State bank that files an application under sub-
section (c) to acquire or establish a branch with-
in a host State shall—
‘‘(i) comply with any filing require-
ment of the host State that—
‘‘(I) is not discriminatory in na-
ture; and
‘‘(II) is similar in effect to a re-
quirement imposed by the host State
on a nonbanking corporation from an-
other State that seeks to engage in
business in the host State; and
‘‘(ii) submit a copy of the application
to the State bank supervisor of the host
State.
‘‘(B) PENALTY FOR FAILURE TO COMPLY.—
The appropriate Federal banking agency may
not approve an application under subsection (c)
by an insured State bank which materially fails
to comply with subparagraph (A) with respect to
such application.
‘‘(3) CONCENTRATION LIMITS.—
‘‘(A) IN GENERAL.—The appropriate Fed-
eral banking agency may not approve an appli-
cation by a bank under subsection (c) if—
‘‘(i) the bank (including all insured de-
pository institutions which are affiliates of
the bank) controls, or upon completion of
the acquisition would control, more than 10
percent of the total amount of insured de-
pository institution deposits in the United
States; or
‘‘(ii) the bank (including all insured
depository institutions which are affiliates
of the bank) controls, or upon completion of
the acquisition would control, 30 percent or
more of the total amount of insured deposi-
tory institution deposits in the State in
which the proposed branch would be located.
‘‘(B) NOT APPLICABLE TO DE NOVO OUT-OF-
STATE BRANCHES.—Subparagraph (A) shall not
apply to the establishment of a de novo branch
outside the home State of an insured State bank.
‘‘(C) WAIVER
BY
STATE.—A State may
waive the application of subparagraph (A)(ii) to
the acquisition of banks or branches in such
State.
‘‘(4) CONSIDERATION OF BANK AFFILIATES.—In
determining whether to grant approval of an applica-
tion under subsection (c) with respect to a proposed
branch by an insured State bank which, as of the date
of the application, does not have a branch in the host
State (of the proposed branch), the appropriate Fed-
eral banking agency shall take into account the most
recent written evaluation under section 807 of the
Community Reinvestment Act of 1977 of each bank
affiliate of the bank which submits the application.
‘‘(e) APPLICABILITY OF STATE AND FEDERAL LAW TO
INTERSTATE BRANCHING OPERATIONS.—
‘‘(1) STATE LAWS APPLICABLE TO BRANCHES OF
OUT-OF-STATE BANKS.—
‘‘(A) IN
GENERAL.—Subject to subsection
(d), any branch of an out-of-State insured State
bank shall be subject to the laws of the host State
as if such branch were a branch of a bank char-
tered by that State.
‘‘(B) ACTIVITIES
OF
BRANCHES.—An in-
sured State bank that establishes a branch in a
host State may not conduct any activity at such
branch that is not permissible for a bank char-
tered by the host State.
‘‘(C) RESERVATION OF CERTAIN RIGHTS TO
STATES.—No provision of this subsection or sub-
section (c) or (d) shall be construed as limiting
in any way the right of a State to—
‘‘(i) determine the authority of State
banks chartered in that State to establish
and maintain branches; or
‘‘(ii) supervise, regulate, and examine
State banks chartered by that State.
‘‘(2) STATE
TAXATION
AUTHORITY
NOT
AF-
FECTED.—No provision of this subsection or sub-
section (c) or (d) shall be construed as affecting the
authority of any State or political subdivision of any
State to apply and administer any tax or method of
taxation to any State bank, including any branch of
a State bank, any bank holding company which con-
trols any State bank, or any affiliate of any such
bank or bank holding company to the extent such tax
or tax method is otherwise permissible by or under
the Constitution of the United States of America or
other Federal law.
‘‘(3) STATE-IMPOSED NOTICE REQUIREMENTS.—
A host State may impose any notification or report-
ing requirement on a branch established or acquired
under subsection (c) if the requirement—
‘‘(A) does not discriminate against out-of-
State banks or bank holding companies; and
‘‘(B) is not preempted by any Federal law
regarding the same subject.
‘‘(4) APPLICABILITY OF DEPOSIT CAPS AND ANTI-
TRUST LAWS.—No provision of this subsection or sub-
section (c) or (d) shall be construed as affecting—
‘‘(A) the authority of any State to limit the
percentage of the total amount of insured deposi-
tory institution deposits in the State which may
be held or controlled by any bank (including all
insured depository institutions which are affili-
ates of the bank) to the extent the application of
such limitation does not discriminate against
out-of-State banks or bank holding companies; or
‘‘(B) the applicability of the antitrust laws
or any State law which is similar to the anti-
trust laws.
‘‘(f) COORDINATION OF EXAMINATION AUTHORITY.—
‘‘(1) IN GENERAL.—A host State bank supervisor
may examine a branch operated in the host State by
an out-of-State insured State bank to—
‘‘(A) determine compliance with host State
laws regarding banking, community reinvest-
ment, fair lending, consumer protection, and
permissible activities; and
‘‘(B) ensure that the activities of the branch
do not constitute a significant risk to the safe
and sound operation of the branch.
‘‘(2) ENFORCEMENT.—If the State bank super-
visor of a host State described in paragraph (1) deter-
mines that there is a violation of host State law con-
cerning the activities being conducted by a branch op-
erated in such State by an out-of-State insured State
bank or that the branch is being operated in an un-
safe and unsound manner, such host State bank su-
pervisor or, to the extent authorized by the law of the
host State, a State law enforcement officer may un-
dertake such enforcement actions or proceedings as
would be permitted under host State law if the branch
were a bank chartered by the host State.
‘‘(3) COOPERATIVE
AGREEMENT.—The State
bank supervisors of 1 or more States may enter into
cooperative agreements to facilitate State regulatory
supervision of State banks and branches, including
cooperative agreements relating to the coordination of
examinations and joint participation in examina-
tions.
‘‘(4) FEDERAL
REGULATORY
AUTHORITY.—No
provision of this section shall be construed as limiting
the authority of any Federal banking agency to exam-
ine any bank or branch of a bank for which the agen-
cy is the appropriate Federal banking agency.
‘‘(g) DEFINITIONS.—For purposes of this section, the
following definitions shall apply:
‘‘(1) ANTITRUST
LAWS.—The term ‘antitrust
laws’—
‘‘(A) has the same meaning as in subsection
(a) of the 1st section of the Clayton Act; and
‘‘(B) includes section 5 of the Federal Trade
Commission Act to the extent such section 5 re-
lates to unfair methods of competition.
‘‘(2) DE
NOVO
BRANCH.—The term ‘de novo
branch’ means a branch of a bank which—
‘‘(A) is originally established by the bank as
a branch; and
‘‘(B) does not become a branch of such bank
as a result of—
‘‘(i) the acquisition by the bank of an
insured depository institution or a branch
of an insured depository institution; or
‘‘(ii) the conversion, merger, or consoli-
dation of any such institution or branch.
‘‘(3) HOME
STATE.—The term ‘home State’
means, with respect to a State bank, the State by
whom the bank is chartered.
‘‘(4) HOST STATE.—The term ‘host State’ means
the State in which a bank establishes or maintains a
branch other than the home State of the bank.
‘‘(5) OUT-OF-STATE
BANK.—The term ‘out-of-
State bank’ means, with respect to any State, a bank
whose home State is another State.
‘‘(6) OUT-OF-STATE BANK HOLDING COMPANY.—
The term ‘out-of-State bank’ means, with respect to
any State, a bank holding company whose home State
(as defined in section 3(d)(4)(D) of the Bank Holding
Company Act of 1956) is another State.’’.
(b) TECHNICAL AND CONFORMING AMENDMENT.—Sec-
tion 3(o) of the Federal Deposit Insurance Act (12 U.S.C.
1813(o)) is amended to read as follows:
‘‘(o) DEFINITIONS RELATING TO DOMESTIC AND FOR-
EIGN BRANCHES.—
‘‘(1) BRANCH.—The term ‘branch’ means a do-
mestic branch or a foreign branch, except when such
term is used in connection with the term ‘Federal
branch’ or ‘insured branch’.
‘‘(2) DOMESTIC
BRANCH.—The term ‘domestic
branch’ includes any branch bank, branch office,
branch agency, additional office, or any branch lo-
cated in any State at which deposits are received,
checks are paid, or money is lent.
‘‘(3) FOREIGN
BRANCH.—The term ‘foreign
branch’ means any office or place at which banking
operations are conducted and which is not located in
any State.’’.
SEC. 104. BRANCHING BY FOREIGN BANKS.
(a) IN GENERAL.—Section 5(a) of the International
Banking Act of 1978 (12 U.S.C. 3103(a)) is amended to
read as follows:
‘‘(a) INTERSTATE BRANCHING
AND AGENCY OPER-
ATIONS.—
‘‘(1) FEDERAL BRANCH OR AGENCY.—Subject to
the provisions of this Act and with the prior written
approval by the Board and the Comptroller of the
Currency of an application, a foreign bank may es-
tablish and operate a Federal branch or agency in
any State outside the home State of such foreign bank
to the extent that the establishment and operation of
such branch would be permitted under section 5155 of
the Revised Statutes if the foreign bank were a na-
tional bank whose home State (as defined in sub-
section (e)(5) of such section) is the same State as the
home State of the foreign bank.
‘‘(2) STATE BRANCH OR AGENCY.—Subject to the
provisions of this Act and with the prior written ap-
proval by the Board and the appropriate State bank
supervisor of an application, a foreign bank may es-
tablish and operate a State branch or agency in any
State outside the home State of such foreign bank to
the extent that such establishment and operation
would be permitted under section 44 of the Federal
Deposit Insurance Act if the foreign bank were a
State bank whose home State (as defined in subsection
(g) of such section) is the same State as the home
State of the foreign bank.
‘‘(3) CRITERIA
FOR
DETERMINATION.—In ap-
proving an application under paragraph (1) or (2),
the Board and (in the case of an application under
paragraph (1)) the Comptroller of the Currency—
‘‘(A) shall apply the standards applicable to
the establishment of a foreign bank office in the
United States under section 7(d); and
‘‘(B) may not approve an application un-
less the Board and (in the case of an application
under paragraph (1)) the Comptroller of the
Currency—
‘‘(i) determine that the foreign bank’s
financial resources, including the capital
level of the bank, are equivalent to those re-
quired for a domestic bank to be approved
for branching under section 5155 of the Re-
vised Statutes and section 44 of the Federal
Deposit Insurance Act; and
‘‘(ii) consult with the Secretary of the
Treasury regarding capital equivalency.
‘‘(4) REQUIREMENT FOR A SEPARATE SUBSIDI-
ARY.—If the Board or the Comptroller of the Cur-
rency, taking into account differing regulatory or ac-
counting standards, finds that adherence by a foreign
bank to capital requirements equivalent to those im-
posed under section 5155 of the Revised Statutes and
section 44 of the Federal Deposit Insurance Act could
be verified only if the banking activities of such bank
in the United States are carried out in a domestic
banking subsidiary within the United States, the
Board and the Comptroller of the Currency may ap-
prove an application under paragraph (1) subject to