Protecting Consumers from Bailouts Act

Bill: 118-s-825
Sponsor: full_name: Sen. Hawley, Josh [R-MO]
Introduced: 2023-03-15
Policy area: Finance and Financial Sector
Latest action: action_date: 2023-03-15
text: Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Summaries:
action_date: 2023-03-15
action_desc: Introduced in Senate
text: <p><b>Protecting Consumers from Bailouts Act </b></p> <p>This bill places limitations on special assessments imposed by the Federal Deposit Insurance Corporation (FDIC) on banks. (After the FDIC assists an institution in an emergency such as a bank failure, these special assessments are levied by the FDIC to recover costs.) The bill also grants the FDIC authority to recover certain compensation paid to an officer. </p> <p>Specifically, the bill prohibits the FDIC from imposing a special assessment on banks with assets under $10 billion. The bill also prohibits depository institutions that are required to pay a special assessment in connection with the March 2023 emergency involving Silicon Valley Bank and Signature Bank from increasing customer fees or charges to offset these costs. </p> <p>The bill also grants the FDIC the authority to seek reimbursement of any incentive-based compensation paid during the previous year to an officer of an institution in FDIC receivership.</p>

tv_txt: II 118th CONGRESS 1st Session S. 825 IN THE SENATE OF THE UNITED STATES March 15, 2023 Mr. Hawley (for himself and Mr. Braun ) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs A BILL To provide limitations of special assessments on community banks, and for other purposes.

1. Short title This Act may be cited as the Protecting Consumers from Bailouts Act . 2. Limitation on special assessments on community banks (a) In general The Federal Deposit Insurance Corporation may not impose an assessment on any bank with less than $10,000,000,000 in total assets in imposing a special assessment under section 13(c)(4)(G)(ii) of the Federal Deposit Insurance Act ( 12 U.S.C. 1823(c)(4)(G)(ii) ). (b) Prohibition on increase of fees to customers (1) In general No institution required to pay a special assessment under section 13(c)(4)(G)(ii) of the Federal Deposit Insurance Act ( 12 U.S.C. 1823(c)(4)(G)(ii) ) in connection with the resolution of Silicon Valley Bank and Signature Bank in March 2023 by the Department of the Treasury shall increase any fees or charges to customers of the institution in an attempt to offset the costs of the special assessment. (2) Civil penalty A violation of paragraph (1) shall constitute a failure to pay an assessment under section 18(h) of the Federal Deposit Insurance Act ( 12 U.S.C. 1828(h) ). 3. FDIC bonus clawback authority Section 23(c)(4)(G) of the Federal Deposit Insurance Act ( 12 U.S.C. 1823(c)(4)(G) ) is amended by adding at the end the following: (vi) Incentive-based compensation claw back (I) Definition In this clause: (aa) Incentive-based compensation The term incentive-based compensation includes any compensation that is granted, earned, or vested based wholly or in part upon the attainment of any financial reporting measure or other performance metric. (bb) Officer The term officer has the meaning given the term in section 240.16a–1 of title 17, Code of Federal Regulations. (II) Clawback (aa) In general If the Corporation takes other action or provides assistance under this subparagraph, the Corporation shall have authority to seek reimbursement to the Deposit Insurance Fund any amount of incentive-based compensation paid to an officer of an insured depository institution for which the Corporation is appointed receiver during the 1-year period ending on the date on which such appointment is made. (bb) Civil penalty Any officer who fails to reimburse the Deposit Insurance Fund under item (aa) shall be liable to the United States for a civil penalty equal to 3 times the amount of the incentive-based compensation received by the officer. .