Financial Services Regulatory Relief Act of 2005

        [Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3505 Referred in Senate (RFS)]

109th CONGRESS
2d Session
H. R. 3505

_______________________________________________________________________

IN THE SENATE OF THE UNITED STATES

March 9, 2006

Received; read twice and referred to the Committee on Banking, Housing,
and Urban Affairs

_______________________________________________________________________

AN ACT

To provide regulatory relief and improve productivity for insured
depository institutions, and for other purposes.

Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) Short Title.--This Act may be cited as the ``Financial Services
Regulatory Relief Act of 2005''.
(b) Table of Contents.--The table of contents for this Act is as
follows:

Sec. 1. Short title; table of contents.
TITLE I--NATIONAL BANK PROVISIONS

Sec. 101. National bank directors.
Sec. 102. Voting in shareholder elections.
Sec. 103. Simplifying dividend calculations for national banks.
Sec. 104. Repeal of obsolete limitation on removal authority of the
Comptroller of the Currency.
Sec. 105. Repeal of intrastate branch capital requirements.
Sec. 106. Clarification of waiver of publication requirements for bank
merger notices.
Sec. 107. Equal treatment for Federal agencies of foreign banks.
Sec. 108. Maintenance of a Federal branch and a Federal agency in the
same State.
Sec. 109. Business organization flexibility for national banks.
Sec. 110. Clarification of the main place of business of a national
bank.
Sec. 111. Capital equivalency deposits for Federal branches and
agencies of foreign banks.
Sec. 112. Enhancing the authority for national banks to make community
development investments.
TITLE II--SAVINGS ASSOCIATION PROVISIONS

Sec. 201. Parity for savings associations under the Securities Exchange
Act of 1934 and the Investment Advisers Act
of 1940.
Sec. 202. Investments by Federal savings associations authorized to
promote the public welfare.
Sec. 203. Mergers and consolidations of Federal savings associations
with nondepository institution affiliates.
Sec. 204. Repeal of statutory dividend notice requirement for savings
association subsidiaries of savings and
loan holding companies.
Sec. 205. Modernizing statutory authority for trust ownership of
savings associations.
Sec. 206. Repeal of overlapping rules governing purchased mortgage
servicing rights.
Sec. 207. Restatement of authority for Federal savings associations to
invest in small business investment
companies.
Sec. 208. Removal of limitation on investments in auto loans.
Sec. 209. Selling and offering of deposit products.
Sec. 210. Funeral- and cemetery-related fiduciary services.
Sec. 211. Repeal of qualified thrift lender requirement with respect to
out-of-state branches.
Sec. 212. Small business and other commercial loans.
Sec. 213. Clarifying citizenship of Federal savings associations for
Federal court jurisdiction.
Sec. 214. Increase in limits on commercial real estate loans.
Sec. 215. Repeal of one limit on loans to one borrower.
Sec. 216. Savings association credit card banks.
Sec. 217. Interstate acquisitions by S&L holding companies.
Sec. 218. Business organization flexibility for federal savings
associations.
TITLE III--CREDIT UNION PROVISIONS

Sec. 301. Privately insured credit unions authorized to become members
of a Federal home loan bank.
Sec. 302. Leases of land on Federal facilities for credit unions.
Sec. 303. Investments in securities by Federal credit unions.
Sec. 304. Increase in general 12-year limitation of term of Federal
credit union loans to 15 years.
Sec. 305. Increase in 1 percent investment limit in credit union
service organizations.
Sec. 306. Member business loan exclusion for loans to nonprofit
religious organizations.
Sec. 307. Check cashing and money transfer services offered within the
field of membership.
Sec. 308. Voluntary mergers involving multiple common-bond credit
unions.
Sec. 309. Conversions involving common-bond credit unions.
Sec. 310. Credit union governance.
Sec. 311. Providing the National Credit Union Administration with
greater flexibility in responding to market
conditions.
Sec. 312. Exemption from pre-merger notification requirement of the
Clayton Act.
Sec. 313. Treatment of credit unions as depository institutions under
securities laws.
Sec. 314. Clarification of definition of net worth under certain
circumstances for purposes of prompt
corrective action.
Sec. 315. Amendments relating to nonfederally insured credit unions.
TITLE IV--DEPOSITORY INSTITUTION PROVISIONS

Sec. 401. Easing restrictions on interstate branching and mergers.
Sec. 402. Statute of limitations for judicial review of appointment of
a receiver for depository institutions.
Sec. 403. Reporting requirements relating to insider lending.
Sec. 404. Amendment to provide an inflation adjustment for the small
depository institution exception under the
Depository Institution Management
Interlocks Act.
Sec. 405. Enhancing the safety and soundness of insured depository
institutions.
Sec. 406. Investments by insured savings associations in bank service
companies authorized.
Sec. 407. Cross guarantee authority.
Sec. 408. Golden parachute authority and nonbank holding companies.
Sec. 409. Amendments relating to change in bank control.
Sec. 410. Community reinvestment credit for esops and ewocs.
Sec. 411. Minority financial institutions.
TITLE V--DEPOSITORY INSTITUTION AFFILIATES PROVISIONS

Sec. 501. Clarification of cross marketing provision.
Sec. 502. Amendment to provide the Federal Reserve Board with
discretion concerning the imputation of
control of shares of a company by trustees.
Sec. 503. Eliminating geographic limits on thrift service companies.
Sec. 504. Clarification of scope of applicable rate provision.
Sec. 505. Savings associations acting as agents for affiliated
depository institutions.
Sec. 506. Credit card bank investments for the public welfare.
TITLE VI--BANKING AGENCY PROVISIONS

Sec. 601. Waiver of examination schedule in order to allocate examiner
resources.
Sec. 602. Interagency data sharing.
Sec. 603. Penalty for unauthorized participation by convicted
individual.
Sec. 604. Amendment permitting the destruction of old records of a
depository institution by the FDIC after
the appointment of the FDIC as receiver.
Sec. 605. Modernization of recordkeeping requirement.
Sec. 606. Streamlining reports of condition.
Sec. 607. Expansion of eligibility for 18-month examination schedule
for community banks.
Sec. 608. Short form reports of condition for certain community banks.
Sec. 609. Clarification of extent of suspension, removal, and
prohibition authority of Federal banking
agencies in cases of certain crimes by
institution-affiliated parties.
Sec. 610. Streamlining depository institution merger application
requirements.
Sec. 611. Inclusion of Director of the Office of Thrift Supervision in
list of banking agencies regarding
insurance customer protection regulations.
Sec. 612. Protection of confidential information received by Federal
banking regulators from foreign banking
supervisors.
Sec. 613. Prohibition on participation by convicted individual.
Sec. 614. Clarification that notice after separation from service may
be made by an order.
Sec. 615. Enforcement against misrepresentations regarding FDIC deposit
insurance coverage.
Sec. 616. Changes required to small bank holding company policy
statement on assessment of financial and
managerial factors.
Sec. 617. Exception to annual privacy notice requirement under the
Gramm-Leach-Bliley Act.
Sec. 618. Biennial reports on the status of agency employment of
minorities and women.
Sec. 619. Coordination of State examination authority.
Sec. 620. Nonwaiver of privileges.
Sec. 621. Right to Financial Privacy Act of 1978 amendment.
Sec. 622. Deputy director; succession authority for Director of the
Office of Thrift Supervision.
Sec. 623. Limitation on scope of new agency guidelines.
TITLE VII--``BSA'' COMPLIANCE BURDEN REDUCTION

Sec. 701. Exception from currency transaction reports for seasoned
customers.
Sec. 702. Reduction in inconsistencies in monetary transaction
recordkeeping and reporting enforcement and
examination requirements.
Sec. 703. Additional reforms relating to monetary transaction and
recordkeeping requirements applicable to
financial institutions.
Sec. 704. Study by Comptroller General.
Sec. 705. Feasibility study required.
Sec. 706. Annual report by Secretary of the Treasury.
Sec. 707. Preservation of money services businesses.
TITLE VIII--CLERICAL AND TECHNICAL AMENDMENTS

Sec. 801. Clerical amendments to the Home Owners' Loan Act.
Sec. 802. Technical corrections to the Federal Credit Union Act.
Sec. 803. Other technical corrections.
Sec. 804. Repeal of obsolete provisions of the Bank Holding Company Act
of 1956.
TITLE IX--FAIR DEBT COLLECTION PRACTICES ACT AMENDMENTS

Sec. 901. Exception for certain bad check enforcement programs.
Sec. 902. Other amendments.

TITLE I--NATIONAL BANK PROVISIONS

SEC. 101. NATIONAL BANK DIRECTORS.

(a) In General.--Section 5146 of the Revised Statutes of the United
States (12 U.S.C. 72) is amended--
(1) by striking ``Sec. 5146. Every director must during''
and inserting the following:

``SEC. 5146. REQUIREMENTS FOR BANK DIRECTORS.

``(a) Residency Requirements.--Every director of a national bank
shall, during'';
(2) by striking ``total number of directors. Every director
must own in his or her own right'' and inserting ``total number
of directors.
``(b) Investment Requirement.--
``(1) In general.--Every director of a national bank shall
own, in his or her own right,''; and
(3) by adding at the end the following new paragraph:
``(2) Exception for subordinated debt in certain cases.--In
lieu of the requirements of paragraph (1) relating to the
ownership of capital stock in the national bank, the
Comptroller of the Currency may, by regulation or order, permit
an individual to serve as a director of a national bank that
has elected, or notifies the Comptroller of the bank's
intention to elect, to operate as a S corporation pursuant to
section 1362(a) of the Internal Revenue Code of 1986, if that
individual holds debt of at least $1,000 issued by the national
bank that is subordinated to the interests of depositors and
other general creditors of the national bank.''.
(b) Clerical Amendment.--The table of sections for chapter one of
title LXII of the Revised Statutes of the United States (12 U.S.C. 21
et seq.) is amended by striking the item relating to section 5146 and
inserting the following new item:

``5146. Requirements for bank directors.''.

SEC. 102. VOTING IN SHAREHOLDER ELECTIONS.

Section 5144 of the Revised Statutes of the United States (12
U.S.C. 61) is amended--
(1) by striking ``or to cumulate'' and inserting ``or, if
so provided by the articles of association of the national
bank, to cumulate'';
(2) by striking the comma after ``his shares shall equal'';
and
(3) by adding at the end the following new sentence: ``The
Comptroller of the Currency may prescribe such regulations to
carry out the purposes of this section as the Comptroller
determines to be appropriate.''.

SEC. 103. SIMPLIFYING DIVIDEND CALCULATIONS FOR NATIONAL BANKS.

(a) In General.--Section 5199 of the Revised Statutes of the United
States (12 U.S.C. 60) is amended to read as follows:

``SEC. 5199. NATIONAL BANK DIVIDENDS.

``(a) In General.--Subject to subsection (b), the directors of any
national bank may declare a dividend of so much of the undivided
profits of the bank as the directors judge to be expedient.
``(b) Approval Required Under Certain Circumstances.--A national
bank may not declare and pay dividends in any year in excess of an
amount equal to the sum of the total of the net income of the bank for
that year and the retained net income of the bank in the preceding two
years, minus any transfers required by the Comptroller of the Currency
(including any transfers required to be made to a fund for the
retirement of any preferred stock), unless the Comptroller of the
Currency approves the declaration and payment of dividends in excess of
such amount.''.
(b) Clerical Amendment.--The table of sections for chapter three of
title LXII of the Revised Statutes of the United States is amended by
striking the item relating to section 5199 and inserting the following
new item:

``5199. National bank dividends.''.

SEC. 104. REPEAL OF OBSOLETE LIMITATION ON REMOVAL AUTHORITY OF THE
COMPTROLLER OF THE CURRENCY.

Section 8(e)(4) of the Federal Deposit Insurance Act (12 U.S.C.
1818(e)(4)) is amended by striking the 5th sentence.

SEC. 105. REPEAL OF INTRASTATE BRANCH CAPITAL REQUIREMENTS.

Section 5155(c) of the Revised Statutes of the United States (12
U.S.C. 36(c)) is amended--
(1) in the 2nd sentence, by striking ``, without regard to
the capital requirements of this section,''; and
(2) by striking the last sentence.

SEC. 106. CLARIFICATION OF WAIVER OF PUBLICATION REQUIREMENTS FOR BANK
MERGER NOTICES.

The last sentence of sections 2(a) and 3(a)(2) of the National Bank
Consolidation and Merger Act (12 U.S.C. 215(a) and 215a(a)(2),
respectively) are each amended by striking ``Publication of notice may
be waived, in cases where the Comptroller determines that an emergency
exists justifying such waiver, by unanimous action of the shareholders
of the association or State bank'' and inserting ``Publication of
notice may be waived if the Comptroller determines that an emergency
exists justifying such waiver or if the shareholders of the association
or State bank agree by unanimous action to waive the publication
requirement for their respective institutions''.

SEC. 107. EQUAL TREATMENT FOR FEDERAL AGENCIES OF FOREIGN BANKS.

The 1st sentence of section 4(d) of the International Banking Act
of 1978 (12 U.S.C. 3102(d)) is amended by inserting ``from citizens or
residents of the United States'' after ``deposits''.

SEC. 108. MAINTENANCE OF A FEDERAL BRANCH AND A FEDERAL AGENCY IN THE
SAME STATE.

Section 4(e) of the International Banking Act of 1978 (12 U.S.C.
3102(e)) is amended by inserting ``if the maintenance of both an agency
and a branch in the State is prohibited under the law of such State''
before the period at the end.

SEC. 109. BUSINESS ORGANIZATION FLEXIBILITY FOR NATIONAL BANKS.

(a) In General.--Chapter one of title LXII of the Revised Statutes
of the United States (12 U.S.C. 21 et seq.) is amended by inserting
after section 5136B the following new section:

``SEC. 5136C. ALTERNATIVE BUSINESS ORGANIZATION.

``(a) In General.--The Comptroller of the Currency may prescribe
regulations--
``(1) to permit a national bank to be organized other than
as a body corporate; and
``(2) to provide requirements for the organizational
characteristics of a national bank organized and operating
other than as a body corporate, consistent with the safety and
soundness of the national bank.
``(b) Equal Treatment.--Except as provided in regulations
prescribed under subsection (a), a national bank that is operating
other than as a body corporate shall have the same rights and
privileges and shall be subject to the same duties, restrictions,
penalties, liabilities, conditions, and limitations as a national bank
that is organized as a body corporate.''.
(b) Technical and Conforming Amendment.--Section 5136 of the
Revised Statutes of the United States (12 U.S.C. 24) is amended, in the
matter preceding the paragraph designated as the ``First'', by
inserting ``or other form of business organization provided under
regulations prescribed by the Comptroller of the Currency under section
5136C'' after ``a body corporate''.
(c) Clerical Amendment.--The table of sections for chapter one of
title LXII of the Revised Statutes of the United States (12 U.S.C. 21
et seq.) is amended by inserting after the item relating to section
5136B the following new item:

``5136C. Alternative business organization.''.

SEC. 110. CLARIFICATION OF THE MAIN PLACE OF BUSINESS OF A NATIONAL
BANK.

Title LXII of the Revised Statutes of the United States is
amended--
(1) in the paragraph designated the ``Second'' of section
5134 (12 U.S.C. 22), by striking ``The place where its
operations of discount and deposit are to be carried on'' and
inserting ``The place where the main office of the national
bank is, or is to be, located''; and
(2) in section 5190 (12 U.S.C. 81), by striking ``the place
specified in its organization certificate'' and inserting ``the
main office of the national bank''.

SEC. 111. CAPITAL EQUIVALENCY DEPOSITS FOR FEDERAL BRANCHES AND
AGENCIES OF FOREIGN BANKS.

Section 4(g) of the International Banking Act of 1978 (12 U.S.C.
3102(g)) is amended to read as follows:
``(g) Capital Equivalency Deposit.--
``(1) In general.--Upon the opening of a Federal branch or
agency of a foreign bank in any State and thereafter, the
foreign bank, in addition to any deposit requirements imposed
under section 6, shall keep on deposit, in accordance with such
regulations as the Comptroller of the Currency may prescribe in
accordance with paragraph (2), dollar deposits, investment
securities, or other assets in such amounts as the Comptroller
of the Currency determines to be necessary for the protection
of depositors and other investors and to be consistent with the
principles of safety and soundness.
``(2) Limitation.--Notwithstanding paragraph (1),
regulations prescribed under such paragraph shall not permit a
foreign bank to keep assets on deposit in an amount that is
less than the amount required for a State licensed branch or
agency of a foreign bank under the laws and regulations of the
State in which the Federal agency or branch is located.''.

SEC. 112. ENHANCING THE AUTHORITY FOR NATIONAL BANKS TO MAKE COMMUNITY
DEVELOPMENT INVESTMENTS.

The last sentence in the paragraph designated as the ``Eleventh.''
of section 5136 of the Revised Statutes of the United States (12 U.S.C.
24) is amended by striking ``10 percent'' each place such term appears
and inserting ``15 percent''.

TITLE II--SAVINGS ASSOCIATION PROVISIONS

SEC. 201. PARITY FOR SAVINGS ASSOCIATIONS UNDER THE SECURITIES EXCHANGE
ACT OF 1934 AND THE INVESTMENT ADVISERS ACT OF 1940.

(a) Securities Exchange Act of 1934.--
(1) Definition of bank.--Section 3(a)(6) of the Securities
Exchange Act of 1934 (15 U.S.C. 78c(a)(6)) is amended--
(A) in subparagraph (A), by inserting ``or a
Federal savings association, as defined in section 2(5)
of the Home Owners' Loan Act'' after ``a banking
institution organized under the laws of the United
States''; and
(B) in subparagraph (C)--
(i) by inserting ``or savings association
as defined in section 2(4) of the Home Owners'
Loan Act,'' after ``banking institution,''; and
(ii) by inserting ``or savings
associations'' after ``having supervision over
banks''.
(2) Include ots under the definition of appropriate
regulatory agency for certain purposes.--Section 3(a)(34) of
such Act (15 U.S.C. 78c(a)(34)) is amended--
(A) in subparagraph (A)--
(i) in clause (ii), by striking ``(i) or
(iii)'' and inserting ``(i), (iii), or (iv)'';
(ii) by striking ``and'' at the end of
clause (iii);
(iii) by redesignating clause (iv) as
clause (v); and
(iv) by inserting the following new clause
after clause (iii):
``(iv) the Director of the Office of Thrift
Supervision, in the case of a savings
association (as defined in section 3(b) of the
Federal Deposit Insurance Act (12 U.S.C.
1813(b))) the deposits of which are insured by
the Federal Deposit Insurance Corporation, a
subsidiary or a department or division of any
such savings association, or a savings and loan
holding company; and'';
(B) in subparagraph (B)--
(i) in clause (ii), by striking ``(i) or
(iii)'' and inserting ``(i), (iii), or (iv)'';
(ii) by striking ``and'' at the end of
clause (iii);
(iii) by redesignating clause (iv) as
clause (v); and
(iv) by inserting the following new clause
after clause (iii):
``(iv) the Director of the Office of Thrift
Supervision, in the case of a savings
association (as defined in section 3(b) of the
Federal Deposit Insurance Act (12 U.S.C.
1813(b))) the deposits of which are insured by
the Federal Deposit Insurance Corporation, or a
subsidiary of any such savings association, or
a savings and loan holding company; and'';
(C) in subparagraph (C)--
(i) in clause (ii), by striking ``(i) or
(iii)'' and inserting ``(i), (iii), or (iv)'';
(ii) by striking ``and'' at the end of
clause (iii);
(iii) by redesignating clause (iv) as
clause (v); and
(iv) by inserting the following new clause
after clause (iii):
``(iv) the Director of the Office of Thrift
Supervision, in the case of a savings
association (as defined in section 3(b) of the
Federal Deposit Insurance Act (12 U.S.C.
1813(b))) the deposits of which are insured by
the Federal Deposit Insurance Corporation, a
savings and loan holding company, or a
subsidiary of a savings and loan holding
company when the appropriate regulatory agency
for such clearing agency is not the Commission;
and'';
(D) in subparagraph (D)--
(i) by striking ``and'' at the end of
clause (ii);
(ii) by redesignating clause (iii) as
clause (iv); and
(iii) by inserting the following new clause
after clause (ii):
``(iii) the Director of the Office of
Thrift Supervision, in the case of a savings
association (as defined in section 3(b) of the
Federal Deposit Insurance Act (12 U.S.C.
1813(b))) the deposits of which are insured by
the Federal Deposit Insurance Corporation;
and'';
(E) in subparagraph (F)--
(i) by redesignating clauses (ii), (iii),
and (iv) as clauses (iii), (iv), and (v),
respectively; and
(ii) by inserting the following new clause
after clause (i):
``(ii) the Director of the Office of Thrift
Supervision, in the case of a savings
association (as defined in section 3(b) of the
Federal Deposit Insurance Act (12 U.S.C.
1813(b))) the deposits of which are insured by
the Federal Deposit Insurance Corporation;
and'';
(F) by moving subparagraph (H) and inserting such
subparagraph after subparagraph (G); and
(G) by adding at the end the following new
sentence: ``As used in this paragraph, the term
`savings and loan holding company' has the meaning
given it in section 10(a) of the Home Owners' Loan Act
(12 U.S.C. 1467a(a)).''.
(b) Investment Advisers Act of 1940.--
(1) Definition of bank.--Section 202(a)(2) of the
Investment Advisers Act of 1940 (15 U.S.C. 80b-2(a)(2)) is
amended--
(A) in subparagraph (A) by inserting ``or a Federal
savings association, as defined in section 2(5) of the
Home Owners' Loan Act'' after ``a banking institution
organized under the laws of the United States''; and
(B) in subparagraph (C)--
(i) by inserting ``, savings association as
defined in section 2(4) of the Home Owners'
Loan Act,'' after ``banking institution''; and
(ii) by inserting ``or savings
associations'' after ``having supervision over
banks''.
(2) Conforming amendments.--Subsections (a)(1)(A)(i),
(a)(1)(B), (a)(2), and (b) of section 210A of such Act (15
U.S.C. 80b-10a), as added by section 220 of the Gramm-Leach-
Bliley Act, are each amended by striking ``bank holding
company'' each place it occurs and inserting ``bank holding
company or savings and loan holding company''.
(c) Conforming Amendment to the Investment Company Act of 1940.--
Section 10(c) of the Investment Company Act of 1940 (15 U.S.C. 80a-
10(c)), as amended by section 213(c) of the Gramm-Leach-Bliley Act, is
amended by inserting after ``1956)'' the following: ``or any one
savings and loan holding company (together with its affiliates and
subsidiaries) (as such terms are defined in section 10 of the Home
Owners' Loan Act)''.

SEC. 202. INVESTMENTS BY FEDERAL SAVINGS ASSOCIATIONS AUTHORIZED TO
PROMOTE THE PUBLIC WELFARE.

(a) In General.--Section 5(c)(3) of the Home Owners' Loan Act (12
U.S.C. 1464(c)) is amended by adding at the end the following new
subparagraph:
``(D) Direct investments to promote the public
welfare.--
``(i) In general.--A Federal savings
association may make investments designed
primarily to promote the public welfare,
including the welfare of low- and moderate-
income communities or families through the
provision of housing, services, and jobs.
``(ii) Direct investments or acquisition of
interest in other companies.--Investments under
clause (i) may be made directly or by
purchasing interests in an entity primarily
engaged in making such investments.
``(iii) Prohibition on unlimited
liability.--No investment may be made under
this subparagraph which would subject a Federal
savings association to unlimited liability to
any person.
``(iv) Single investment limitation to be
established by director.--Subject to clauses
(v) and (vi), the Director shall establish, by
order or regulation, limits on--
``(I) the amount any savings
association may invest in any 1
project; and
``(II) the aggregate amount of
investment of any savings association
under this subparagraph.
``(v) Flexible aggregate investment
limitation.--The aggregate amount of
investments of any savings association under
this subparagraph may not exceed an amount
equal to the sum of 5 percent of the savings
association's capital stock actually paid in
and unimpaired and 5 percent of the savings
association's unimpaired surplus, unless--
``(I) the Director determines that
the savings association is adequately
capitalized; and
``(II) the Director determines, by
order, that the aggregate amount of
investments in a higher amount than the
limit under this clause will pose no
significant risk to the affected
deposit insurance fund.
``(vi) Maximum aggregate investment
limitation.--Notwithstanding clause (v), the
aggregate amount of investments of any savings
association under this subparagraph may not
exceed an amount equal to the sum of 15 percent
of the savings association's capital stock
actually paid in and unimpaired and 15 percent
of the savings association's unimpaired
surplus.
``(vii) Investments not subject to other
limitation on quality of investments.--No
obligation a Federal savings association
acquires or retains under this subparagraph
shall be taken into account for purposes of the
limitation contained in section 28(d) of the
Federal Deposit Insurance Act on the
acquisition and retention of any corporate debt
security not of investment grade.''.
(b) Technical and Conforming Amendment.--Section 5(c)(3)(A) of the
Home Owners' Loan Act (12 U.S.C. 1464(c)(3)(A)) is amended to read as
follows:
``(A) [Repealed].''.

SEC. 203. MERGERS AND CONSOLIDATIONS OF FEDERAL SAVINGS ASSOCIATIONS
WITH NONDEPOSITORY INSTITUTION AFFILIATES.

Section 5(d)(3) of the Home Owners' Loan Act (12 U.S.C. 1464(d)(3))
is amended--
(1) by redesignating subparagraph (B) as subparagraph (C);
and
(2) by inserting after subparagraph (A) the following new
subparagraph:
``(B) Mergers and consolidations with nondepository
institution affiliates.--
``(i) In general.--Upon the approval of the
Director, a Federal savings association may
merge with any nondepository institution
affiliate of the savings association.
``(ii) Rule of construction.--No provision
of clause (i) shall be construed as--
``(I) affecting the applicability
of section 18(c) of the Federal Deposit
Insurance Act; or
``(II) granting a Federal savings
association any power or any authority
to engage in any activity that is not
authorized for a Federal savings
association under any other provision
of this Act or any other provision of
law.''.

SEC. 204. REPEAL OF STATUTORY DIVIDEND NOTICE REQUIREMENT FOR SAVINGS
ASSOCIATION SUBSIDIARIES OF SAVINGS AND LOAN HOLDING
COMPANIES.

Section 10(f) of the Home Owners' Loan Act (12 U.S.C. 1467a(f)) is
amended to read as follows:
``(f) Declaration of Dividend.--The Director may--
``(1) require a savings association that is a subsidiary of
a savings and loan holding company to give prior notice to the
Director of the intent of the savings association to pay a
dividend on its guaranty, permanent, or other nonwithdrawable
stock; and
``(2) establish conditions on the payment of dividends by
such a savings association.''.

SEC. 205. MODERNIZING STATUTORY AUTHORITY FOR TRUST OWNERSHIP OF
SAVINGS ASSOCIATIONS.

(a) In General.--Section 10(a)(1)(C) of the Home Owners' Loan Act
(12 U.S.C. 1467a(a)(1)(C)) is amended--
(1) by striking ``trust,'' and inserting ``business
trust,''; and
(2) by inserting ``or any other trust unless by its terms
it must terminate within 25 years or not later than 21 years
and 10 months after the death of individuals living on the
effective date of the trust,'' after ``or similar
organization,''.
(b) Technical and Conforming Amendment.--Section 10(a)(3) of the
Home Owners' Loan Act (12 U.S.C. 1467a(a)(3)) is amended--
(1) by striking ``does not include--'' and all that follows
through ``any company by virtue'' where such term appears in
subparagraph (A) and inserting ``does not include any company
by virtue'';
(2) by striking ``; and'' at the end of subparagraph (A)
and inserting a period; and
(3) by striking subparagraph (B).

SEC. 206. REPEAL OF OVERLAPPING RULES GOVERNING PURCHASED MORTGAGE
SERVICING RIGHTS.

Section 5(t) of the Home Owners' Loan Act (12 U.S.C. 1464(t)) is
amended--
(1) by striking paragraph (4) and inserting the following
new paragraph:
``(4) [Repealed].''; and
(2) in paragraph (9)(A), by striking ``intangible assets,
plus'' and all that follows through the period at the end and
inserting ``intangible assets.''.

SEC. 207. RESTATEMENT OF AUTHORITY FOR FEDERAL SAVINGS ASSOCIATIONS TO
INVEST IN SMALL BUSINESS INVESTMENT COMPANIES.

Subparagraph (D) of section 5(c)(4) of the Home Owners' Loan Act
(12 U.S.C. 1464(c)(4)) is amended to read as follows:
``(D) Small business investment companies.--Any
Federal savings association may invest in 1 or more
small business investment companies, or in any entity
established to invest solely in small business
investment companies formed under the Small Business
Investment Act of 1958, except that the total amount of
investments under this subparagraph may not at any time
exceed the amount equal to 5 percent of capital and
surplus of the savings association.''.

SEC. 208. REMOVAL OF LIMITATION ON INVESTMENTS IN AUTO LOANS.

(a) In General.--Section 5(c)(1) of the Home Owners' Loan Act (12
U.S.C. 1464(c)(1)) is amended by adding at the end the following new
subparagraph:
``(V) Auto loans.--Loans and leases for motor
vehicles acquired for personal, family, or household
purposes.''.
(b) Technical and Conforming Amendment Relating to Qualified Thrift
Investments.--Section 10(m)(4)(C)(ii) of the Home Owners' Loan Act (12
U.S.C. 1467a(m)(4)(C)(ii)) is amended by adding at the end the
following new subclause:
``(VIII) Loans and leases for motor
vehicles acquired for personal, family,
or household purposes.''.

SEC. 209. SELLING AND OFFERING OF DEPOSIT PRODUCTS.

Section 15(h) of the Securities Exchange Act of 1934 (15 U.S.C.
78o(h)) is amended by adding at the end the following new paragraph:
``(4) Selling and offering of deposit products.--No law,
rule, regulation, or order, or other administrative action of
any State or political subdivision thereof shall directly or
indirectly require any individual who is an agent of 1 Federal
savings association (as such term is defined in section 2(5) of
the Home Owners' Loan Act (12 U.S.C. 1462(5)) in selling or
offering deposit (as such term is defined in section 3 of the
Federal Deposit Insurance Act (12 U.S.C. 1813(l)) products
issued by such association to qualify or register as a broker,
dealer, associated person of a broker, or associated person of
a dealer, or to qualify or register in any other similar status
or capacity, if the individual does not--
``(A) accept deposits or make withdrawals on behalf
of any customer of the association;
``(B) offer or sell a deposit product as an agent
for another entity that is not subject to supervision
and examination by a Federal banking agency (as defined
in section 3(z) of the Federal Deposit Insurance Act
(12 U.S.C. 1813(z)), the National Credit Union
Administration, or any officer, agency, or other entity
of any State which has primary regulatory authority
over State banks, State savings associations, or State
credit unions;
``(C) offer or sell a deposit product that is not
an insured deposit (as defined in section 3(m) of the
Federal Deposit Insurance Act (12 U.S.C. 1813(m)));
``(D) offer or sell a deposit product which
contains a feature that makes it callable at the option
of such Federal savings association; or
``(E) create a secondary market with respect to a
deposit product or otherwise add enhancements or
features to such product independent of those offered
by the association.''.

SEC. 210. FUNERAL- AND CEMETERY-RELATED FIDUCIARY SERVICES.

Section 5(n) of the Home Owners' Loan Act (12 U.S.C. 1464(n)) is
amended by adding at the end the following new paragraph:
``(11) Funeral- and cemetery-related fiduciary services.--
``(A) In general.--A funeral director or cemetery
operator, when acting in such capacity, (or any other
person in connection with a contract or other agreement
with a funeral director or cemetery operator) may
engage any Federal savings association, regardless of
where the association is located, to act in any
fiduciary capacity in which the savings association has
the right to act in accordance with this section,
including holding funds deposited in trust or escrow by
the funeral director or cemetery operator (or by such
other party), and the savings association may act in
such fiduciary capacity on behalf of the funeral
director or cemetery operator (or such other person).
``(B) Definitions.--For purposes of this paragraph,
the following definitions shall apply:
``(i) Cemetery.--The term `cemetery' means
any land or structure used, or intended to be
used, for the interment of human remains in any
form.
``(ii) Cemetery operator.--The term
`cemetery operator' means any person who
contracts or accepts payment for merchandise,
endowment, or perpetual care services in
connection with a cemetery.
``(iii) Funeral director.--The term
`funeral director' means any person who
contracts or accepts payment to provide or
arrange--
``(I) services for the final
disposition of human remains; or
``(II) funeral services, property,
or merchandise (including cemetery
services, property, or merchandise).''.

SEC. 211. REPEAL OF QUALIFIED THRIFT LENDER REQUIREMENT WITH RESPECT TO
OUT-OF-STATE BRANCHES.

Section 5(r)(1) of the Home Owners' Loan Act (12 U.S.C. 1464(r)(1))
is amended by striking the last sentence.

SEC. 212. SMALL BUSINESS AND OTHER COMMERCIAL LOANS.

(a) Elimination of Lending Limit on Small Business Loans.--Section
5(c)(1) of the Home Owners' Loan Act (12 U.S.C. 1464(c)(1)) is amended
by inserting after subparagraph (V) (as added by section 208 of this
title) the following new subparagraph:
``(W) Small business loans.--Small business loans,
as defined in regulations which the Director shall
prescribe.''.
(b) Increase in Lending Limit on Other Business Loans.--Section
5(c)(2)(A) of the Home Owners' Loan Act (12 U.S.C. 1464(c)(2)(A)) is
amended by striking ``, and amounts in excess of 10 percent'' and all
that follows through ``by the Director''.

SEC. 213. CLARIFYING CITIZENSHIP OF FEDERAL SAVINGS ASSOCIATIONS FOR
FEDERAL COURT JURISDICTION.

Section 5 of the Home Owners' Loan Act (12 U.S.C. 1464) is amended
by adding at the end the following new subsection:
``(x) Home State Citizenship.--In determining whether a Federal
court has diversity jurisdiction over a case in which a Federal savings
association is a party, the Federal savings association shall be
considered to be a citizen only of the States in which such savings
association has its home office and its principal place of business (if
the principal place of business is in a different State than the home
office).''.

SEC. 214. INCREASE IN LIMITS ON COMMERCIAL REAL ESTATE LOANS.

Section 5(c)(2)(B)(i) of the Home Owners' Loan Act (12 U.S.C.
1464(c)(2)(B)(i)) is amended by striking ``400 percent'' and inserting
``500 percent''.

SEC. 215. REPEAL OF ONE LIMIT ON LOANS TO ONE BORROWER.

Subparagraph (A) of section 5(u)(2) of the Home Owners' Loan Act
(12 U.S.C. 1464(u)(2)(A)) is amended--
(1) by striking subclause (I) of clause (ii);
(2) by redesignating subclauses (II), (III), (IV), and (V)
of clause (ii) as subclauses (I), (II), (III), and (IV),
respectively;
(3) in clause (i)--
(A) by striking ``for any'' and inserting ``For
any''; and
(B) by striking ``; or'' and inserting a period;
and
(4) in clause (ii), by striking ``to develop domestic'' and
inserting ``To develop domestic''.

SEC. 216. SAVINGS ASSOCIATION CREDIT CARD BANKS.

Section 10(a)(1)(A) of the Home Owners' Loan Act (12 U.S.C.
1467a(a)(1)(A)) is amended by inserting ``and such term does not
include an institution described in section 2(c)(2)(F) of the Bank
Holding Company Act of 1956 for purposes of subsections (a)(1)(E),
(c)(3)(B)(i), (c)(9)(C)(i), and (e)(3)'' before the period at the end.

SEC. 217. INTERSTATE ACQUISITIONS BY S&L HOLDING COMPANIES.

Section 10(e)(3) of the Home Owners' Loan Act (12 U.S.C.
1467a(e)(3)) is amended--
(1) by redesignating subparagraphs (A), (B), and (C) as
subparagraphs (B), (C), and (D), respectively; and
(2) by inserting before subparagraph (B) (as so
redesignated) the following new subparagraph:
``(A) such acquisition would be permissible under
section 3(d) of the Bank Holding Company Act of 1956 if
the savings and loan holding company were a bank
holding company and any savings association to be
acquired were a bank;''.

SEC. 218. BUSINESS ORGANIZATION FLEXIBILITY FOR FEDERAL SAVINGS
ASSOCIATIONS.

(a) In General.--Section 5 of the Home Owners' Loan Act (12 U.S.C.
1464) is amended by inserting after subsection (x) (as added by section
213) following new subsection:
``(y) Alternative Business Organization.--
``(1) In general.--The Director may prescribe regulations
that--
``(A) permit a Federal savings association to be
organized other than as a corporation; and
``(B) provide requirements for the organizational
characteristics of a Federal savings association
organized and operating other than as a corporation,
consistent with the safety and soundness of the Federal
savings association.
``(2) Equal treatment.--Except as otherwise provided in
regulations prescribed under subsection (1), a Federal savings
association that is operating other than as a corporation shall
have the same rights and privileges and shall be subject to the
same duties, restrictions, penalties, liabilities, conditions,
and limitations as a Federal savings association that is
organized as a corporation.''.
(b) Technical and Conforming Amendments.--
(1) Section 5(a)(1) of the Home Owners' Loan Act (12 U.S.C.
1464(a)(1)) is amended by striking ``organization,
incorporation,'' and inserting ``organization (as a corporation
or other form of business organization provided under
regulations prescribed by the Director under subsection
(x)),''.
(2) The last sentence of section 5(i)(1) of the Home
Owners' Loan Act (12 U.S.C. 1464(i)(1)) is amended by striking
``incorporated'' and inserting ``organized''.
(3) Section 5(o)(1) of the Home Owners' Loan Act (12 U.S.C.
1464(a)(1)) is amended by striking ``organization,
incorporation,'' and inserting ``organization (as a corporation
or other form of business organization provided under
regulations prescribed by the Director under subsection
(x)),''.

TITLE III--CREDIT UNION PROVISIONS

SEC. 301. PRIVATELY INSURED CREDIT UNIONS AUTHORIZED TO BECOME MEMBERS
OF A FEDERAL HOME LOAN BANK.

(a) In General.--Section 4(a) of the Federal Home Loan Bank Act (12
U.S.C. 1424(a)) is amended by adding at the end the following new
paragraph:
``(5) Certain privately insured credit unions.--
``(A) In general.--A credit union which has been
determined, in accordance with section 43(e)(1) of the
Federal Deposit Insurance Act and subject to the
requirements of subparagraph (B), to meet all
eligibility requirements for Federal deposit insurance
shall be treated as an insured depository institution
for purposes of determining the eligibility of such
credit union for membership in a Federal home loan bank
under paragraphs (1), (2), and (3).
``(B) Certification by appropriate supervisor.--
``(i) In general.--For purposes of this
paragraph and subject to clause (ii), a credit
union which lacks Federal deposit insurance and
which has applied for membership in a Federal
home loan bank may be treated as meeting all
the eligibility requirements for Federal
deposit insurance only if the appropriate
supervisor of the State in which the credit
union is chartered has determined that the
credit union meets all the eligibility
requirements for Federal deposit insurance as
of the date of the application for membership.
``(ii) Certification deemed valid.--If, in
the case of any credit union to which clause
(i) applies, the appropriate supervisor of the
State in which such credit union is chartered
fails to make a determination pursuant to such
clause by the end of the 6-month period
beginning on the date of the application, the
credit union shall be deemed to have met the
requirements of clause (i).
``(C) Security interests of federal home loan bank
not avoidable.--Notwithstanding any provision of State
law authorizing a conservator or liquidating agent of a
credit union to repudiate contracts, no such provision
shall apply with respect to--
``(i) any extension of credit from any
Federal home loan bank to any credit union
which is a member of any such bank pursuant to
this paragraph; or
``(ii) any security interest in the assets
of such credit union securing any such
extension of credit.''.
(b) Copies of Audits of Private Insurers of Certain Depository
Institutions Required to Be Provided to Supervisory Agencies.--Section
43(a)(2) of the Federal Deposit Insurance Act (12 U.S.C. 1831t(a)(2))
is amended--
(1) by striking ``and'' at the end of subparagraph (A)(i);
(2) by striking the period at the end of clause (ii) of
subparagraph (A) and inserting a semicolon;
(3) by inserting the following new clauses at the end of
subparagraph (A):
``(iii) in the case of depository
institutions described in subsection (f)(2)(A)
the deposits of which are insured by the
private insurer, the National Credit Union
Administration, not later than 7 days after
that audit is completed; and
``(iv) in the case of depository
institutions described in subsection (f)(2)(A)
the deposits of which are insured by the
private insurer which are members of a Federal
home loan bank, the Federal Housing Finance
Board, not later than 7 days after that audit
is completed.''; and
(4) by adding at the end the following new subparagraph:
``(C) Consultation.--The appropriate supervisory
agency of each State in which a private deposit insurer
insures deposits in an institution described in
subsection (f)(2)(A) which--
``(i) lacks Federal deposit insurance; and
``(ii) has become a member of a Federal
home loan bank,
shall provide the National Credit Union Administration,
upon request, with the results of any examination and
reports related thereto concerning the private deposit
insurer to which such agency may have in its
possession.''.

SEC. 302. LEASES OF LAND ON FEDERAL FACILITIES FOR CREDIT UNIONS.

(a) In General.--Section 124 of the Federal Credit Union Act (12
U.S.C. 1770) is amended--
(1) by striking ``Upon application by any credit union''
and inserting ``Notwithstanding any other provision of law,
upon application by any credit union'';
(2) by inserting ``on lands reserved for the use of, and
under the exclusive or concurrent jurisdiction of, the United
States or'' after ``officer or agency of the United States
charged with the allotment of space'';
(3) by inserting ``lease land or'' after ``such officer or
agency may in his or its discretion''; and
(4) by inserting ``or the facility built on the lease
land'' after ``credit union to be served by the allotment of
space''.
(b) Clerical Amendment.--The heading for section 124 is amended by
inserting ``or federal land'' after ``buildings''.

SEC. 303. INVESTMENTS IN SECURITIES BY FEDERAL CREDIT UNIONS.

Section 107 of the Federal Credit Union Act (12 U.S.C. 1757) is
amended--
(1) in the matter preceding paragraph (1) by striking ``A
Federal credit union'' and inserting ``(a) In General.--Any
Federal credit union''; and
(2) by adding at the end the following new subsection:
``(b) Additional Investment Authority.--
``(1) In general.--In addition to any investments otherwise
authorized, a Federal credit union may purchase and hold for
its own account such investment securities of investment grade
as the Board may authorize by regulation, subject to such
limitations and restrictions as the Board may prescribe in the
regulations.
``(2) Percentage limitations.--
``(A) Single obligor.--In no event may the total
amount of investment securities of any single obligor
or maker held by a Federal credit union for the credit
union's own account exceed at any time an amount equal
to 10 percent of the net worth of the credit union.
``(B) Aggregate investments.--In no event may the
aggregate amount of investment securities held by a
Federal credit union for the credit union's own account
exceed at any time an amount equal to 10 percent of the
assets of the credit union.
``(3) Investment security defined.--
``(A) In general.--For purposes of this subsection,
the term `investment security' means marketable
obligations evidencing the indebtedness of any person
in the form of bonds, notes, or debentures and other
instruments commonly referred to as investment
securities.
``(B) Further definition by board.--The Board may
further define the term `investment security'.
``(4) Investment grade defined.--The term `investment
grade' means with respect to an investment security purchased
by a credit union for its own account, an investment security
that at the time of such purchase is rated in one of the 4
highest rating categories by at least 1 nationally recognized
statistical rating organization.
``(5) Clarification of prohibition on stock ownership.--No
provision of this subsection shall be construed as authorizing
a Federal credit union to purchase shares of stock of any
corporation for the credit union's own account, except as
otherwise permitted by law.''.

SEC. 304. INCREASE IN GENERAL 12-YEAR LIMITATION OF TERM OF FEDERAL
CREDIT UNION LOANS TO 15 YEARS.

Section 107(a)(5) of the Federal Credit Union Act (12 U.S.C.
1757(5)) (as so designated by section 303 of this title) is amended--
(1) in the matter preceding subparagraph (A), by striking
``to make loans, the maturities of which shall not exceed
twelve years except as otherwise provided herein'' and
inserting ``to make loans, the maturities of which shall not
exceed 15 years or any longer maturity as the Board may allow,
in regulations, except as otherwise provided in this Act'';
(2) in subparagraph (A)--
(A) by striking clause (ii);
(B) by redesignating clauses (iii) through (x) as
clauses (ii) through (ix), respectively; and
(C) by inserting ``and'' after the semicolon at the
end of clause (viii) (as so redesignated).

SEC. 305. INCREASE IN 1 PERCENT INVESTMENT LIMIT IN CREDIT UNION
SERVICE ORGANIZATIONS.

Section 107(a)(7)(I) of the Federal Credit Union Act (12 U.S.C.
1757(7)(I)) (as so designated by section 303 of this title) is amended
by striking ``up to 1 per centum of the total paid'' and inserting ``up
to 3 percent of the total paid''.

SEC. 306. MEMBER BUSINESS LOAN EXCLUSION FOR LOANS TO NONPROFIT
RELIGIOUS ORGANIZATIONS.

Section 107A(a) of the Federal Credit Union Act (12 U.S.C.
1757a(a)) is amended by inserting ``, excluding loans made to nonprofit
religious organizations,'' after ``total amount of such loans''.

SEC. 307. CHECK CASHING AND MONEY TRANSFER SERVICES OFFERED WITHIN THE
FIELD OF MEMBERSHIP.

Paragraph (12) of section 107(a) of the Federal Credit Union Act
(12 U.S.C. 1757(12)) (as so designated by section 303 of this title) is
amended to read as follows:
``(12) in accordance with regulations prescribed by the
Board--
``(A) to sell, to persons in the field of
membership, negotiable checks (including travelers
checks), money orders, and other similar money transfer
instruments (including international and domestic
electronic fund transfers); and
``(B) to cash checks and money orders and receive
international and domestic electronic fund transfers
for persons in the field of membership for a fee;''.

SEC. 308. VOLUNTARY MERGERS INVOLVING MULTIPLE COMMON-BOND CREDIT
UNIONS.

Section 109(d)(2) of the Federal Credit Union Act (12 U.S.C.
1759(d)(2)) is amended--
(1) by striking ``or'' at the end of clause (ii) of
subparagraph (B);
(2) by striking the period at the end of subparagraph (C)
and inserting ``; or''; and
(3) by adding at the end the following new subparagraph:
``(D) a merger involving any such Federal credit
union approved by the Board on or after August 7,
1998.''.

SEC. 309. CONVERSIONS INVOLVING COMMON-BOND CREDIT UNIONS.

Section 109(g) of the Federal Credit Union Act (12 U.S.C. 1759(g))
is amended by inserting after paragraph (2) the following new
paragraph:
``(3) Criteria for continued membership of certain member
groups in community charter conversions.--In the case of a
voluntary conversion of a common-bond credit union described in
paragraph (1) or (2) of subsection (b) into a community credit
union described in subsection (b)(3), the Board shall
prescribe, by regulation, the criteria under which the Board
may determine that a member group or other portion of a credit
union's existing membership, that is located outside the well-
defined local community, neighborhood, or rural district that
shall constitute the community charter, can be satisfactorily
served by the credit union and remain within the community
credit union's field of membership.''.

SEC. 310. CREDIT UNION GOVERNANCE.

(a) Expulsion of Members for Just Cause.--Subsection (b) of section
118 of the Federal Credit Union Act (12 U.S.C. 1764(b)) is amended to
read as follows:
``(b) Policy and Actions of Boards of Directors of Federal Credit
Unions.--
``(1) Expulsion of members for nonparticipation or for just
cause.--The board of directors of a Federal credit union may,
by majority vote of a quorum of directors, adopt and enforce a
policy with respect to expulsion from membership, by a majority
vote of such board of directors, based on just cause, including
disruption of credit union operations, or on nonparticipation
by a member in the affairs of the credit union.
``(2) Written notice of policy to members.--If a policy
described in paragraph (1) is adopted, written notice of the
policy as adopted and the effective date of such policy shall
be provided to--
``(A) each existing member of the credit union not
less than 30 days prior to the effective date of such
policy; and
``(B) each new member prior to or upon applying for
membership.''.
(b) Term Limits Authorized for Board Members of Federal Credit
Unions.--Section 111(a) of the Federal Credit Union Act (12 U.S.C.
1761(a)) is amended by adding at the end the following new sentence:
``The bylaws of a Federal credit union may limit the number of
consecutive terms any person may serve on the board of directors of
such credit union.''.
(c) Reimbursement for Lost Wages Due to Service on Credit Union
Board not Treated as Compensation.--Section 111(c) of the Federal
Credit Union Act (12 U.S.C. 1761(c)) is amended by inserting ``,
including lost wages,'' after ``the reimbursement of reasonable
expenses''.

SEC. 311. PROVIDING THE NATIONAL CREDIT UNION ADMINISTRATION WITH
GREATER FLEXIBILITY IN RESPONDING TO MARKET CONDITIONS.

Section 107(a)(5)(A)(v)(I) of the Federal Credit Union Act (12
U.S.C. 1757(5)(A)(vi)(I)) (as so designated by section 303 and
redesignated by section 304(2)(B) of this title) is amended by striking
``six-month period and that prevailing interest rate levels'' and
inserting ``6-month period or that prevailing interest rate levels''.

SEC. 312. EXEMPTION FROM PRE-MERGER NOTIFICATION REQUIREMENT OF THE
CLAYTON ACT.

Section 7A(c)(7) of the Clayton Act (15 U.S.C. 18a(c)(7)) is
amended by inserting ``section 205(b)(3) of the Federal Credit Union
Act (12 U.S.C. 1785(b)(3)),'' before ``or section 3''.

SEC. 313. TREATMENT OF CREDIT UNIONS AS DEPOSITORY INSTITUTIONS UNDER
SECURITIES LAWS.

(a) Definition of Bank Under the Securities Exchange Act of 1934.--
Section 3(a)(6) of the Securities Exchange Act of 1934 (15 U.S.C.
78c(a)(6)) (as amended by section 201(a)(1) of this Act) is amended--
(1) by striking ``this title, and (D) a receiver'' and
inserting ``this title, (D) an insured credit union (as defined
in section 101(7) of the Federal Credit Union Act) but only for
purposes of paragraphs (4) and (5) of this subsection and only
for activities otherwise authorized by applicable laws to which
such credit unions are subject, and (E) a receiver''; and
(2) in subparagraph (E) (as so redesignated by paragraph
(1) of this subsection) by striking ``(A), (B), or (C)'' and
inserting ``(A), (B), (C), or (D)''.
(b) Definition of Bank Under the Investment Advisers Act of 1940.--
Section 202(a)(2) of the Investment Advisers Act of 1940 (15 U.S.C.
80b-2(a)(2)) (as amended by section 201(b)(1) of this Act) is amended--
(1) by striking ``this title, and (D) a receiver'' and
inserting ``this title, (D) an insured credit union (as defined
in section 101(7) of the Federal Credit Union Act) but only for
activities otherwise authorized by applicable laws to which
such credit unions are subject, and (E) a receiver''; and
(2) in subparagraph (E) (as so redesignated by paragraph
(1) of this subsection) by striking ``(A), (B), or (C)'' and
inserting ``(A), (B), (C), or (D)''.
(c) Definition of Appropriate Federal Banking Agency.--Section
210A(c) of the Investment Advisers Act of 1940 (15 U.S.C. 80b-10a(c))
is amended by inserting ``and includes the National Credit Union
Administration Board, in the case of an insured credit union (as
defined in section 101(7) of the Federal Credit Union Act)'' before the
period at the end.

SEC. 314. CLARIFICATION OF DEFINITION OF NET WORTH UNDER CERTAIN
CIRCUMSTANCES FOR PURPOSES OF PROMPT CORRECTIVE ACTION.

Subparagraph (A) of section 216(o)(2) of the Federal Credit Union
Act (12 U.S.C. 1790d(o)(2)(A)) is amended--
(1) by inserting ``the'' before ``retained earnings
balance''; and
(2) by inserting ``, together with any amounts that were
previously retained earnings of any other credit union with
which the credit union has combined'' before the semicolon at
the end.

SEC. 315. AMENDMENTS RELATING TO NONFEDERALLY INSURED CREDIT UNIONS.

(a) In General.--Subsection (a) of section 43 of the Federal
Deposit Insurance Act (12 U.S.C. 1831t(a)) is amended by adding at the
end the following new paragraph:
``(3) Enforcement by appropriate state supervisor.--Any
appropriate State supervisor of a private deposit insurer, and
any appropriate State supervisor of a depository institution
which receives deposits that are insured by a private deposit
insurer, may examine and enforce compliance with this
subsection under the applicable regulatory authority of such
supervisor.''.
(b) Amendment Relating to Disclosures Required, Periodic Statements
and Account Records.--Section 43(b)(1) of the Federal Deposit Insurance
Act (12 U.S.C. 1831t(b)(1)) is amended by striking ``or similar
instrument evidencing a deposit'' and inserting ``or share
certificate''.
(c) Amendments Relating to Disclosures Required, Advertising,
Premises.-- Section 43(b)(2) of the Federal Deposit Insurance Act (12
U.S.C. 1831t(b)(2)) is amended to read as follows:
``(2) Advertising; premises.--
``(A) In general.--Include clearly and
conspicuously in all advertising, except as provided in
subparagraph (B); and at each station or window where
deposits are normally received, its principal place of
business and all its branches where it accepts deposits
or opens accounts (excluding automated teller machines
or point of sale terminals), and on its main Internet
page, a notice that the institution is not federally
insured.
``(B) Exceptions.--The following need not include a
notice that the institution is not federally insured:
``(i) Statements or reports of financial
condition of the depository institution that
are required to be published or posted by State
or Federal law or regulation.
``(ii) Any sign, document, or other item
that contains the name of the depository
institution, its logo, or its contact
information, but only if the sign, document, or
item does not include any information about the
institution's products or services or
information otherwise promoting the
institution.
``(iii) Small utilitarian items that do not
mention deposit products or insurance if
inclusion of the notice would be
impractical.''.
(d) Amendments Relating to Acknowledgment of Disclosure.--Section
43(b)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1831t(b)(3))
is amended to read as follows:
``(3) Acknowledgment of disclosure.--
``(A) New depositors obtained other than through a
conversion or merger.--With respect to any depositor
who was not a depositor at the depository institution
before the effective date of the Financial Services
Relief Act of 2005, and who is not a depositor as
described in subparagraph (B), receive any deposit for
the account of such depositor only if the depositor has
signed a written acknowledgement that--
``(i) the institution is not federally
insured; and
``(ii) if the institution fails, the
Federal Government does not guarantee that the
depositor will get back the depositor's money.
``(B) New depositors obtained through a conversion
or merger.--With respect to a depositor at a federally
insured depository institution that converts to, or
merges into, a depository institution lacking federal
insurance after the effective date of the Financial
Services Regulatory Relief Act of 2005, receive any
deposit for the account of such depositor only if--
``(i) the depositor has signed a written
acknowledgement described in subparagraph (A);
or
``(ii) the institution makes an attempt, as
described in subparagraph (D) and sent by mail
no later than 45 days after the effective date
of the conversion or merger, to obtain the
acknowledgment.
``(C) Current depositors.--Receive any deposit
after the effective date of the Financial Services
Regulatory Relief Act of 2005 for the account of any
depositor who was a depositor on that date only if--
``(i) the depositor has signed a written
acknowledgement described in subparagraph (A);
or
``(ii) the institution makes an attempt, as
described in subparagraph (D) and sent by mail
no later than 45 days after the effective date
of the Financial Services Regulatory Relief Act
of 2005, to obtain the acknowledgment.
``(D) Alternative provision of notice to current
depositors and new depositors obtained through a
conversion or merger.--
``(i) In general.--Transmit to each
depositor who has not signed a written
acknowledgement described in subparagraph (A)--
``(I) a conspicuous card containing
the information described in clauses
(i) and (ii) of subparagraph (A), and a
line for the signature of the
depositor; and
``(II) accompanying materials
requesting the depositor to sign the
card, and return the signed card to the
institution.''.
(e) Repeal of Provision Prohibiting Nondepository Institutions From
Accepting Deposits.--Section 43 of the Federal Deposit Insurance Act
(12 U.S.C. 1831t) is amended--
(1) by striking subsection (e); and
(2) by redesignating subsections (f) and (g) as subsections
(e) and (f), respectively.
(f) Repeal of Provision Concerning Nondepository Institutions
Masquerading as Depository Institutions and Clarification of Depository
Institutions Covered by the Statute.--Subsection (e)(2) (as so
redesignated by subsection (e) of this section) of section 43 of the
Federal Deposit Insurance Act (12 U.S.C. 1831t) is amended to read as
follows:
``(2) Depository institution.--The term `depository
institution'--
``(A) includes any entity described in section
19(b)(1)(A)(iv) of the Federal Reserve Act; and
``(B) does not include any national bank, State
member bank, or Federal branch.''.
(g) Repeal of FTC Authority to Enforce Independent Audit
Requirement; Concurrent State Enforcement.--Subsection (f) (as so
redesignated by subsection (e) of this section) of section 43 of the
Federal Deposit Insurance Act (12 U.S.C. 1831t) is amended to read as
follows:
``(f) Enforcement.--
``(1) Limited ftc enforcement authority.--Compliance with
the requirements of subsections (b) and (c), and any regulation
prescribed or order issued under any such subsection, shall be
enforced under the Federal Trade Commission Act by the Federal
Trade Commission.
``(2) Broad state enforcement authority.--
``(A) In general.--Subject to subparagraph (C), an
appropriate State supervisor of a depository
institution lacking Federal deposit insurance may
examine and enforce compliance with the requirements of
this section, and any regulation prescribed under this
section.
``(B) State powers.--For purposes of bringing any
action to enforce compliance with this section, no
provision of this section shall be construed as
preventing an appropriate State supervisor of a
depository institution lacking Federal deposit
insurance from exercising any powers conferred on such
official by the laws of such State.
``(C) Limitation on state action while federal
action pending.--If the Federal Trade Commission has
instituted an enforcement action for a violation of
this section, no appropriate State supervisor may,
during the pendency of such action, bring an action
under this section against any defendant named in the
complaint of the Commission for any violation of this
section that is alleged in that complaint.''.

TITLE IV--DEPOSITORY INSTITUTION PROVISIONS

SEC. 401. EASING RESTRICTIONS ON INTERSTATE BRANCHING AND MERGERS.

(a) De Novo Interstate Branches of National Banks.--
(1) In general.--Section 5155(g)(1) of the Revised Statutes
of the United States (12 U.S.C. 36(g)(1)) is amended by
striking ``maintain a branch if--'' and all that follows
through the end of subparagraph (B) and inserting ``maintain a
branch.''.
(2) Clerical amendment.--The heading for subsection (g) of
section 5155 of the Revised Statutes of the United States is
amended by striking ``State `Opt-in' Election to Permit''.
(b) De Novo Interstate Branches of State Nonmember Banks.--
(1) In general.--Section 18(d)(4)(A) of the Federal Deposit
Insurance Act (12 U.S.C. 1828(d)(4)(A)) is amended by striking
``maintain a branch if--'' and all that follows through the end
of clause (ii) and inserting ``maintain a branch.''.
(2) Interstate branching by subsidiaries of commercial
firms prohibited.--Section 18(d)(3)) of the Federal Deposit
Insurance Act (12 U.S.C. 1828(d)(3)) is amended by adding at
the end the following new subparagraph:
``(C) Interstate branching by subsidiaries of
commercial firms prohibited.--
``(i) In general.--If the appropriate State
bank supervisor of the home State of any
industrial loan company, industrial bank, or
other institution described in section
2(c)(2)(H) of the Bank Holding Company Act of
1956, or the appropriate State bank supervisor
of any host State with respect to such company,
bank, or institution, determines that such
company, bank, or institution is controlled,
directly or indirectly, by a commercial firm,
such company, bank, or institution may not
acquire, establish, or operate a branch in such
host State.
``(ii) Commercial firm defined.--For
purposes of this subsection, the term
`commercial firm' means any entity at least 15
percent of the annual gross revenues of which
on a consolidated basis, including all
affiliates of the entity, were derived from
engaging, on an on-going basis, in activities
that are not financial in nature or incidental
to a financial activity during at least 3 of
the prior 4 calendar quarters.
``(iii) Grandfathered institutions.--Clause
(i) shall not apply with respect to any
industrial loan company, industrial bank, or
other institution described in section
2(c)(2)(H) of the Bank Holding Company Act of
1956--
``(I) which became an insured
depository institution before October
1, 2003 or pursuant to an application
for deposit insurance which was
approved by the Corporation before such
date; and
``(II) with respect to which there
is no change in control, directly or
indirectly, of the company, bank, or
institution after September 30, 2003,
that requires an application under
subsection (c), section 7(j), section 3
of the Bank Holding Company Act of
1956, or section 10 of the Home Owners'
Loan Act.
``(iv) Transition provision.--Any
divestiture required under this subparagraph of
a branch in a host State shall be completed as
quickly as is reasonably possible.
``(v) Corporate reorganizations
permitted.--The acquisition of direct or
indirect control of the company, bank, or
institution referred to in clause (iii)(II)
shall not be treated as a `change in control'
for purposes of such clause if the company
acquiring control is itself directly or
indirectly controlled by a company that was an
affiliate of such company, bank, or institution
on the date referred to in clause (iii)(II),
and remained an affiliate at all times after
such date.''.
(3) Technical and conforming amendments.--Section 18(d)(4)
of the Federal Deposit Insurance Act (12 U.S.C. 1828(d)(4)) is
amended--
(A) in subparagraph (A) by striking ``Subject to
subparagraph (B)'' and inserting ``Subject to
subparagraph (B) and paragraph (3)(C)''; and
(B) in subparagraphs (D) and (E), by striking ``The
term'' and inserting ``For purposes of this subsection,
the term''.
(4) Clerical amendment.--The heading for paragraph (4) of
section 18(d) of the Federal Deposit Insurance Act is amended
by striking ``State `opt-in' election to permit interstate''
and inserting ``Interstate''.
(c) De Novo Interstate Branches of State Member Banks.--The 3rd
undesignated paragraph of section 9 of the Federal Reserve Act (12
U.S.C. 321) is amended by adding at the end the following new
sentences: ``A State member bank may establish and operate a de novo
branch in a host State (as such terms are defined in section 18(d) of
the Federal Deposit Insurance Act) on the same terms and conditions and
subject to the same limitations and restrictions as are applicable to
the establishment of a de novo branch of a national bank in a host
State under section 5155(g) of the Revised Statutes of the United
States or are applicable to an insured State nonmember bank under
section 18(d)(3) of the Federal Deposit Insurance Act''. Such section
5155(g) shall be applied for purposes of the preceding sentence by
substituting `Board of Governors of the Federal Reserve System' for
`Comptroller of the Currency' and `State member bank' for `national
bank'.''.
(d) Interstate Merger of Banks.--
(1) Merger of insured bank with another depository
institution or trust company.--Section 44(a)(1) of the Federal
Deposit Insurance Act (12 U.S.C. 1831u(a)(1)) is amended--
(A) by striking ``Beginning on June 1, 1997, the''
and inserting ``The''; and
(B) by striking ``insured banks with different home
States'' and inserting ``an insured bank and another
insured depository institution or trust company with a
different home State than the resulting insured bank''.
(2) National bank trust company merger with other trust
company.--Subsection (b) of section 4 of the National Bank
Consolidation and Merger Act (12 U.S.C. 215a-1(b)) is amended
to read as follows:
``(b) Merger of National Bank Trust Company With Another Trust
Company.--A national bank that is a trust company may engage in a
consolidation or merger under this Act with any trust company with a
different home State, under the same terms and conditions that would
apply if the trust companies were located within the same State.''.
(e) Interstate Fiduciary Activity.--Section 18(d) of the Federal
Deposit Insurance Act (12 U.S.C. 1828(d)) is amended by adding at the
end the following new paragraph:
``(5) Interstate fiduciary activity.--
``(A) Authority of state bank supervisor.--The
State bank supervisor of a State bank may approve an
application by the State bank, when not in
contravention of home State or host State law, to act
as trustee, executor, administrator, registrar of
stocks and bonds, guardian of estates, assignee,
receiver, committee of estates of lunatics, or in any
other fiduciary capacity in a host State in which State
banks or other corporations which come into competition
with national banks are permitted to act under the laws
of such host State.
``(B) Noncontravention of host state law.--Whenever
the laws of a host State authorize or permit the
exercise of any or all of the foregoing powers by State
banks or other corporations which compete with national
banks, the granting to and the exercise of such powers
by a State bank as provided in this paragraph shall not
be deemed to be in contravention of host State law
within the meaning of this paragraph.
``(C) State bank includes trust companies.--For
purposes of this paragraph, the term `State bank'
includes any State-chartered trust company (as defined
in section 44(g)).
``(D) Other definitions.--For purposes of this
paragraph, the term `home State' and `host State' have
the meanings given such terms in section 44.''.
(f) Technical and Conforming Amendments.--
(1) Section 44 of the Federal Deposit Insurance Act (12
U.S.C. 1831u) is amended--
(A) in subsection (a)--
(i) by striking paragraph (4) and inserting
the following new paragraph:
``(4) Treatment of branches in connection with certain
interstate merger transactions.--In the case of an interstate
merger transaction which involves the acquisition of a branch
of an insured depository institution or trust company without
the acquisition of the insured depository institution or trust
company, the branch shall be treated, for purposes of this
section, as an insured depository institution or trust company
the home State of which is the State in which the branch is
located.''; and
(ii) by striking paragraphs (5) and (6) and
inserting the following new paragraph:
``(5) Applicability to industrial loan companies.--No
provision of this section shall be construed as authorizing the
approval of any transaction involving a industrial loan
company, industrial bank, or other institution described in
section 2(c)(2)(H) of the Bank Holding Company Act of 1956, or
the acquisition, establishment, or operation of a branch by any
such company, bank, or institution, that is not allowed under
section 18(d)(3).''.
(B) in subsection (b)--
(i) by striking ``bank'' each place such
term appears in paragraph (2)(B)(i) and
inserting ``insured depository institution'';
(ii) by striking ``banks'' where such term
appears in paragraph (2)(E) and inserting
``insured depository institutions or trust
companies'';
(iii) by striking ``bank affiliate'' each
place such term appears in that portion of
paragraph (3) that precedes subparagraph (A)
and inserting ``insured depository institution
affiliate'';
(iv) by striking ``any bank'' where such
term appears in paragraph (3)(B) and inserting
``any insured depository institution'';
(v) by striking ``bank'' where such term
appears in paragraph (4)(A) and inserting
``insured depository institution and trust
company''; and
(vi) by striking ``all banks'' where such
term appears in paragraph (5) and inserting
``all insured depository institutions and trust
companies'';
(C) in subsection (d)(1), by striking ``any bank''
and inserting ``any insured depository institution or
trust company'';
(D) in subsection (e)--
(i) by striking ``1 or more banks'' and
inserting ``1 or more insured depository
institutions''; and
(ii) by striking ``paragraph (2), (4), or
(5)'' and inserting ``paragraph (2)'';
(E) by striking clauses (i) and (ii) of subsection
(g)(4)(A) and inserting the following new clauses:
``(i) with respect to a national bank or
Federal savings association, the State in which
the main office of the bank or savings
association is located; and
``(ii) with respect to a State bank, State
savings association, or State-chartered trust
company, the State by which the bank, savings
association, or trust company is chartered;
and'';
(F) by striking paragraph (5) of subsection (g) and
inserting the following new paragraph:
``(5) Host state.--The term `host State' means--
``(A) with respect to a bank, a State, other than
the home State of the bank, in which the bank
maintains, or seeks to establish and maintain, a
branch; and
``(B) with respect to a trust company and solely
for purposes of section 18(d)(5), a State, other than
the home State of the trust company, in which the trust
company acts, or seeks to act, in 1 or more fiduciary
capacities.'';
(G) in subsection (g)(10), by striking ``section
18(c)(2)'' and inserting ``paragraph (1) or (2) of
section 18(c), as appropriate,''; and
(H) in subsection (g), by adding at the end the
following new paragraph:
``(12) Trust company.--The term `trust company' means--
``(A) any national bank;
``(B) any savings association; and
``(C) any bank, banking association, trust company,
savings bank, or other banking institution which is
incorporated under the laws of any State,
that is authorized to act in 1 or more fiduciary capacities but
is not engaged in the business of receiving deposits other than
trust funds (as defined in section 3(p)).''.
(2) Section 3(d) of the Bank Holding Company Act of 1956
(12 U.S.C. 1842(d)) is amended--
(A) in paragraph (1)--
(i) by striking subparagraphs (B) and (C);
and
(ii) by redesignating subparagraph (D) as
subparagraph (B); and
(B) in paragraph (5), by striking ``subparagraph
(B) or (D)'' and inserting ``subparagraph (B)''.
(3) Subsection (c) of section 4 of the National Bank
Consolidation and Merger Act (12 U.S.C. 215a-1(c)) is amended
to read as follows:
``(c) Definitions.--For purposes of this section, the terms `home
State', `out-of-State bank', and `trust company' each have the same
meaning as in section 44(g) of the Federal Deposit Insurance Act.''.
(g) Clerical Amendments.--
(1) The heading for section 44(b)(2)(E) of the Federal
Deposit Insurance Act (12 U.S.C. 1831u(b)(2)(E)) is amended by
striking ``banks'' and inserting ``insured depository
institutions and trust companies''.
(2) The heading for section 44(e) of the Federal Deposit
Insurance Act (12 U.S.C. 1831u(e)) is amended by striking
``Banks'' and inserting ``Insured Depository Institutions''.

SEC. 402. STATUTE OF LIMITATIONS FOR JUDICIAL REVIEW OF APPOINTMENT OF
A RECEIVER FOR DEPOSITORY INSTITUTIONS.

(a) National Banks.--Section 2 of the National Bank Receivership
Act (12 U.S.C. 191) is amended--
(1) by striking ``SECTION 2. The Comptroller of the
Currency'' and inserting the following:

``SEC. 2. APPOINTMENT OF RECEIVER FOR A NATIONAL BANK.

``(a) In General.--The Comptroller of the Currency''; and
(2) by adding at the end the following new subsection:
``(b) Judicial Review.--If the Comptroller of the Currency appoints
a receiver under subsection (a), the national bank may, within 30 days
thereafter, bring an action in the United States district court for the
judicial district in which the home office of such bank is located, or
in the United States District Court for the District of Columbia, for
an order requiring the Comptroller of the Currency to remove the
receiver, and the court shall, upon the merits, dismiss such action or
direct the Comptroller of the Currency to remove the receiver.''.
(b) Insured Depository Institutions.--Section 11(c)(7) of the
Federal Deposit Insurance Act (12 U.S.C. 1821(c)(7)) is amended to read
as follows:
``(7) Judicial review.--If the Corporation is appointed
(including the appointment of the Corporation as receiver by
the Board of Directors) as conservator or receiver of a
depository institution under paragraph (4), (9), or (10), the
depository institution may, within 30 days thereafter, bring an
action in the United States district court for the judicial
district in which the home office of such depository
institution is located, or in the United States District Court
for the District of Columbia, for an order requiring the
Corporation to be removed as the conservator or receiver
(regardless of how such appointment was made), and the court
shall, upon the merits, dismiss such action or direct the
Corporation to be removed as the conservator or receiver.''.
(c) Expansion of Period for Challenging the Appointment of a
Liquidating Agent.--Subparagraph (B) of section 207(a)(1) of the
Federal Credit Union Act (12 U.S.C. 1787(a)(1)) is amended by striking
``10 days'' and inserting ``30 days''.
(d) Effective Date.--The amendments made by subsections (a), (b),
and (c) shall apply with respect to conservators, receivers, or
liquidating agents appointed on or after the date of the enactment of
this Act.

SEC. 403. REPORTING REQUIREMENTS RELATING TO INSIDER LENDING.

(a) Reporting Requirements Regarding Loans to Executive Officers of
Member Banks.--Section 22(g) of the Federal Reserve Act (12 U.S.C.
375a) is amended--
(1) by striking paragraphs (6) and (9); and
(2) by redesignating paragraphs (7), (8), and (10) as
paragraphs (6), (7), and (8), respectively.
(b) Reporting Requirements Regarding Loans From Correspondent Banks
to Executive Officers and Shareholders of Insured Banks.--Section
106(b)(2) of the Bank Holding Company Act Amendments of 1970 (12 U.S.C.
1972(2)) is amended--
(1) by striking subparagraph (G); and
(2) by redesignating subparagraphs (H) and (I) as
subparagraphs (G) and (H), respectively.

SEC. 404. AMENDMENT TO PROVIDE AN INFLATION ADJUSTMENT FOR THE SMALL
DEPOSITORY INSTITUTION EXCEPTION UNDER THE DEPOSITORY
INSTITUTION MANAGEMENT INTERLOCKS ACT.

Section 203(1) of the Depository Institution Management Interlocks
Act (12 U.S.C. 3202(1)) is amended by striking ``$20,000,000'' and
inserting ``$100,000,000''.

SEC. 405. ENHANCING THE SAFETY AND SOUNDNESS OF INSURED DEPOSITORY
INSTITUTIONS.

(a) Clarification Relating to the Enforceability of Agreements and
Conditions.--The Federal Deposit Insurance Act (12 U.S.C. 1811 et seq.)
is amended by adding at the end the following new section:

``SEC. 49. ENFORCEMENT OF AGREEMENTS.

``(a) In General.--Notwithstanding clause (i) or (ii) of section
8(b)(6)(A) or section 38(e)(2)(E)(i), an appropriate Federal banking
agency may enforce, under section 8, the terms of--
``(1) any condition imposed in writing by the agency on a
depository institution or an institution-affiliated party
(including a bank holding company) in connection with any
action on any application, notice, or other request concerning
a depository institution; or
``(2) any written agreement entered into between the agency
and an institution-affiliated party (including a bank holding
company).
``(b) Receiverships and Conservatorships.--After the appointment of
the Corporation as the receiver or conservator for any insured
depository institution, the Corporation may enforce any condition or
agreement described in paragraph (1) or (2) of subsection (a) involving
such institution or any institution-affiliated party (including a bank
holding company), through an action brought in an appropriate United
States district court.''.
(b) Protection of Capital of Insured Depository Institutions.--
Paragraph (1) of section 18(u) of the Federal Deposit Insurance Act (12
U.S.C. 1828(u)) is amended by striking subparagraph (B) and by
redesignating subparagraph (C) as subparagraph (B).

SEC. 406. INVESTMENTS BY INSURED SAVINGS ASSOCIATIONS IN BANK SERVICE
COMPANIES AUTHORIZED.

(a) In General.--Sections 2 and 3 of the Bank Service Company Act
(12 U.S.C. 1862, 1863) are each amended by striking ``insured bank''
each place such term appears and inserting ``insured depository
institution''.
(b) Technical and Conforming Amendments.--
(1) Section 1(b)(4) of the Bank Service Company Act (12
U.S.C. 1861(b)(4)) is amended--
(A) by inserting ``, except when such term appears
in connection with the term `insured depository
institution','' after ``means''; and
(B) by striking ``Federal Home Loan Bank Board''
and inserting ``Director of the Office of Thrift
Supervision''.
(2) Section 1(b) of the Bank Service Company Act (12 U.S.C.
1861(b)) is amended--
(A) by striking paragraph (5) and inserting the
following new paragraph:
``(5) Insured depository institution.--The term `insured
depository institution' has the meaning given the term in
section 3(c) of the Federal Deposit Insurance Act;'';
(B) by striking ``and'' at the end of paragraph
(7);
(C) by striking the period at the end of paragraph
(8) and inserting ``; and''; and
(D) by adding at the end the following new
paragraph:
``(9) the terms `State depository institution', `Federal
depository institution', `State savings association' and
`Federal savings association' have the meanings given the terms
in section 3 of the Federal Deposit Insurance Act.''.
(3) The 1st sentence of section 5(c)(4)(B) of the Home
Owners' Loan Act (12 U.S.C. 1464(c)(4)(B)) is amended by
striking ``by savings associations of such State and by Federal
associations'' and inserting ``by State and Federal depository
institutions''.
(4) Subparagraph (A)(ii) and subparagraph (B)(ii) of
section 1(b)(2) of the Bank Service Company Act (12 U.S.C.
1861(b)(2)) are each amended by striking ``insured banks'' and
inserting ``insured depository institutions''.
(5) Section 1(b)(8) of the Bank Service Company Act (12
U.S.C. 1861(b)(8)) is further amended--
(A) by striking ``insured bank'' and inserting
``insured depository institution'';
(B) by striking ``insured banks'' each place such
term appears and inserting ``insured depository
institutions''; and
(C) by striking ``the bank's'' and inserting ``the
depository institution's''.
(6) Section 2 of the Bank Service Company Act (12 U.S.C.
1862) is amended by inserting ``or savings associations, other
than the limitation on the amount of investment by a Federal
savings association contained in section 5(c)(4)(B) of the Home
Owners' Loan Act'' after ``relating to banks''.
(7) Section 4(b) of the Bank Service Company Act (12 U.S.C.
1864(b)) is amended by inserting ``as permissible under
subsection (c), (d), or (e) or'' after ``Except''.
(8) Section 4(c) of the Bank Service Company Act (12 U.S.C.
1864(c)) is amended by inserting ``or State savings
association'' after ``State bank'' each place such term
appears.
(9) Section 4(d) of the Bank Service Company Act (12 U.S.C.
1864(d)) is amended by inserting ``or Federal savings
association'' after ``national bank'' each place such term
appears.
(10) Section 4(e) of the Bank Service Company Act (12
U.S.C. 1864(e)) is amended to read as follows:
``(e) A bank service company may perform--
``(1) only those services that each depository institution
shareholder or member is otherwise authorized to perform under
any applicable Federal or State law; and
``(2) such services only at locations in a State in which
each such shareholder or member is authorized to perform such
services.''.
(11) Section 4(f) of the Bank Service Company Act (12
U.S.C. 1864(f)) is amended by inserting ``or savings
associations'' after ``location of banks''.
(12) Section 5 of the Bank Service Company Act (12 U.S.C.
1865) is amended--
(A) in subsection (a)--
(i) by striking ``insured bank'' and
inserting ``insured depository institution'';
and
(ii) by striking ``bank's'' and inserting
``institution's'';
(B) in subsection (b)--
(i) by striking ``insured bank'' and
inserting ``insured depository institution'';
(ii) by inserting ``authorized only'' after
``performs any service''; and
(iii) by inserting ``authorized only''
after ``perform any activity''; and
(C) in subsection (c)--
(i) by striking ``the bank or banks'' and
inserting ``any depository institution''; and
(ii) by striking ``capability of the bank''
and inserting ``capability of the depository
institution''.
(13) Section 7 of the Bank Service Company Act (12 U.S.C.
1867) is amended--
(A) in subsection (b), by striking ``insured bank''
and inserting ``insured depository institution''; and
(B) in subsection (c)--
(i) by striking ``a bank'' each place such
term appears and inserting ``a depository
institution''; and
(ii) by striking ``the bank'' each place
such term appears and inserting ``the
depository institution''.

SEC. 407. CROSS GUARANTEE AUTHORITY.

Subparagraph (A) of section 5(e)(9) of the Federal Deposit
Insurance Act (12 U.S.C. 1815(e)(9)(A)) is amended to read as follows:
``(A) such institutions are controlled by the same
company; or''.

SEC. 408. GOLDEN PARACHUTE AUTHORITY AND NONBANK HOLDING COMPANIES.

Subsection (k) of section 18 of the Federal Deposit Insurance Act
(12 U.S.C. 1828(k)) is amended--
(1) in paragraph (2)(A), by striking ``or depository
institution holding company'' and inserting ``or covered
company'';
(2) by striking subparagraph (B) of paragraph (2) and
inserting the following new subparagraph:
``(B) Whether there is a reasonable basis to
believe that the institution-affiliated party is
substantially responsible for--
``(i) the insolvency of the depository
institution or covered company;
``(ii) the appointment of a conservator or
receiver for the depository institution; or
``(iii) the depository institution's
troubled condition (as defined in the
regulations prescribed pursuant to section
32(f)).'';
(3) in paragraph (2)(F), by striking ``depository
institution holding company'' and inserting ``covered
company,'';
(4) in paragraph (3) in the matter preceding subparagraph
(A), by striking ``depository institution holding company'' and
inserting ``covered company'';
(5) in paragraph (3)(A), by striking ``holding company''
and inserting ``covered company'';
(6) in paragraph (4)(A)--
(A) by striking ``depository institution holding
company'' each place such term appears and inserting
``covered company''; and
(B) by striking ``holding company'' each place such
term appears (other than in connection with the term
referred to in subparagraph (A)) and inserting
``covered company'';
(7) in paragraph (5)(A), by striking ``depository
institution holding company'' and inserting ``covered
company'';
(8) in paragraph (5), by adding at the end the following
new subparagraph:
``(D) Covered company.--The term `covered company'
means any depository institution holding company
(including any company required to file a report under
section 4(f)(6) of the Bank Holding Company Act of
1956), or any other company that controls an insured
depository institution.''; and
(9) in paragraph (6)--
(A) by striking ``depository institution holding
company'' and inserting ``covered company,''; and
(B) by striking ``or holding company'' and
inserting ``or covered company''.

SEC. 409. AMENDMENTS RELATING TO CHANGE IN BANK CONTROL.

Section 7(j) of the Federal Deposit Insurance Act (12 U.S.C.
1817(j)) is amended--
(1) in paragraph (1)(D)--
(A) by striking ``is needed to investigate'' and
inserting ``is needed--
``(i) to investigate'';
(B) by striking ``United States Code.'' and
inserting ``United States Code; or''; and
(C) by adding at the end the following new clause:
``(ii) to analyze the safety and soundness
of any plans or proposals described in
paragraph (6)(E) or the future prospects of the
institution.''; and
(2) in paragraph (7)(C), by striking ``the financial
condition of any acquiring person'' and inserting ``either the
financial condition of any acquiring person or the future
prospects of the institution''.

SEC. 410. COMMUNITY REINVESTMENT CREDIT FOR ESOPS AND EWOCS.

Section 804 of the Community Reinvestment Act of 1977 (12 U.S.C.
2903) is amended by adding at the end the following new subsection--
``(d) Establishment of Esops and Ewocs.--
``(1) In general.--In assessing and taking into account,
under subsection (a), the record of a financial institution,
the appropriate Federal financial supervisory agency shall
consider as a factor activities that support or enable the
establishment of employee stock ownership plans or eligible
worker-owned cooperatives, so long as the employer sponsoring
the plan or cooperative is at least 51 percent owned by
employees, including low to moderate income employees.
``(2) Definitions.--For purposes of this subsection, the
following definitions shall apply:
``(A) Employee stock ownership plan.--The term
`employee stock ownership plan' has the same meaning as
in section 4975(e)(7) of the Internal Revenue Code of
1986.
``(B) Eligible worker-owned cooperative.--The term
`eligible worker-owned cooperative' has the same
meaning as in section 1042(c)(2) of the Internal
Revenue Code of 1986.''.

SEC. 411. MINORITY FINANCIAL INSTITUTIONS.

(a) In General.--The Federal Deposit Insurance Corporation and the
Office of Thrift Supervision shall provide such technical assistance to
minority financial institutions affected by Hurricane Katrina,
Hurricane Rita, and Hurricane Wilma as may be appropriate to preserve
the present number of minority depository institutions and preserve the
minority character in cases involving mergers or acquisitions of a
minority depository institution consistent with section 308(a) of the
Financial Institutions Reform, Recovery, and Enforcement Act of 1989.
(b) Minority Financial Institution Defined.--For purposes of this
subsection, the term ``minority financial institution'' has the same
meaning as in section 308(b) of the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989.

TITLE V--DEPOSITORY INSTITUTION AFFILIATES PROVISIONS

SEC. 501. CLARIFICATION OF CROSS MARKETING PROVISION.

Section 4(n)(5) of the Bank Holding Company Act of 1956 (12 U.S.C.
1843(n)(5)) is amended--
(1) in subparagraph (B), by striking ``subsection
(k)(4)(I)'' and inserting ``subparagraph (H) or (I) of
subsection (k)(4)''; and
(2) by adding at the end the following new subparagraph:
``(C) Threshold of control.--Subparagraph (A) shall
not apply with respect to a company described or
referred to in clause (i) or (ii) of such subparagraph
if the financial holding company does not own or
control 25 percent or more of the total equity or any
class of voting securities of such company.''.

SEC. 502. AMENDMENT TO PROVIDE THE FEDERAL RESERVE BOARD WITH
DISCRETION CONCERNING THE IMPUTATION OF CONTROL OF SHARES
OF A COMPANY BY TRUSTEES.

Section 2(g)(2) of the Bank Holding Company Act of 1956 (12 U.S.C.
1841(g)(2)) is amended by inserting ``, unless the Board determines
that such treatment is not appropriate in light of the facts and
circumstances of the case and the purposes of this Act'' before the
period at the end.

SEC. 503. ELIMINATING GEOGRAPHIC LIMITS ON THRIFT SERVICE COMPANIES.

(a) In General.--The 1st sentence of section 5(c)(4)(B) of the Home
Owners' Loan Act (12 U.S.C. 1464(c)(4)(B)) (as amended by section
406(b)(3) of this Act) is amended--
(1) by striking ``corporation organized'' and all that
follows through ``is available for purchase'' and inserting
``company, if the entire capital of the company is available
for purchase''; and
(2) by striking ``having their home offices in such
State''.
(b) Technical Corrections.--
(1) The heading for subparagraph (B) of section 5(c)(4) of
the Home Owners' Loan Act (12 U.S.C. 1464(c)(4)(B)) is amended
by striking ``corporations'' and inserting ``companies''.
(2) The 2nd sentence of section 5(n)(1) of the Home Owners'
Loan Act (12 U.S.C. 1464(n)(1)) is amended by striking
``service corporations'' and inserting ``service companies''.
(3) Section 5(q)(1) of the Home Owners' Loan Act (12 U.S.C.
1464(q)(1)) is amended by striking ``service corporation'' each
place such term appears in subparagraphs (A), (B), and (C) and
inserting ``service company''.
(4) Section 10(m)(4)(C)(iii)(II) of the Home Owners' Loan
Act (12 U.S.C. 1467a(m)(4)(C)(iii)(II)) is amended by striking
``service corporation'' each place such term appears and
inserting ``service company''.

SEC. 504. CLARIFICATION OF SCOPE OF APPLICABLE RATE PROVISION.

Section 44(f) of the Federal Deposit Insurance Act (12 U.S.C.
1831u(f)) is amended by adding at the end the following new paragraphs:
``(3) Other lenders.--In the case of any other lender doing
business in the State described in paragraph (1), the maximum
interest rate or amount of interest, discount points, finance
charges, or other similar charges that may be charged, taken,
received, or reserved from time to time in any loan, discount,
or credit sale made, or upon any note, bill of exchange,
financing transaction, or other evidence of debt issued to or
acquired by any other lender shall be equal to not more than
the greater of the rates described in subparagraph (A) or (B)
of paragraph (1).
``(4) Other lender defined.--For purposes of paragraph (3),
the term `other lender' means any person engaged in the
business of selling or financing the sale of personal property
(and any services incidental to the sale of personal property)
in such State, except that, with regard to any person or entity
described in such paragraph, such term does not include--
``(A) an insured depository institution; or
``(B) any person or entity engaged in the business
of providing a short-term cash advance to any consumer
in exchange for--
``(i) a consumer's personal check or share
draft, in the amount of the advance plus a fee,
where presentment or negotiation of such check
or share draft is deferred by agreement of the
parties until a designated future date; or
``(ii) a consumer authorization to debit
the consumer's transaction account, in the
amount of the advance plus a fee, where such
account will be debited on or after a
designated future date.''.

SEC. 505. SAVINGS ASSOCIATIONS ACTING AS AGENTS FOR AFFILIATED
DEPOSITORY INSTITUTIONS.

(a) In General.--Section 18(r) of the Federal Deposit Insurance Act
(12 U.S.C. 1828(r)) is amended--
(1) in paragraph (1)--
(A) by striking ``bank subsidiary'' and inserting
``depository institution subsidiary''; and
(B) by striking ``bank holding company'' and
inserting ``depository institution holding company'';
(2) in paragraph (2), by striking ``a bank acting'' and
inserting ``a depository institution acting'';
(3) in paragraphs (3) and (5), by striking ``or (6)'' each
place such term appears in each such paragraph; and
(4) by striking paragraph (6).
(b) Clerical Amendment.--The heading for section 18(r)(2) of the
Federal Deposit Insurance Act (12 U.S.C. 1828(r)) is amended by
striking ``Bank'' and inserting ``Depository institution''.

SEC. 506. CREDIT CARD BANK INVESTMENTS FOR THE PUBLIC WELFARE.

Section 2(c)(2)(F) of the Bank Holding Company Act of 1956 (12
U.S.C. 1841(c)(2)(F)) is amended--
(1) in clause (i), by striking ``engages only in credit
card operations;'' and inserting ``engages only in--
``(I) credit card operations; and
``(II) making investments designed
primarily to promote the public
welfare, including the welfare of low-
and moderate-income communities or
families (such as by providing housing,
services, or jobs), in the manner and
to the extent permitted for national
banks under the paragraph designated
the `Eleventh' of section 5136 of the
Revised Statutes of the United States
and regulations prescribed under such
paragraph, except that the last
sentence of such paragraph shall be
applied for purposes of this subclause
by substituting `5 percent' for `15
percent' each place such term appears;
''; and
(2) in clause (v), by inserting ``, other than making or
purchasing loans for the purposes described in and to the
extent permitted in clause (i)(II))'' before the period at the
end.

TITLE VI--BANKING AGENCY PROVISIONS

SEC. 601. WAIVER OF EXAMINATION SCHEDULE IN ORDER TO ALLOCATE EXAMINER
RESOURCES.

Section 10(d) of the Federal Deposit Insurance Act (12 U.S.C.
1820(d)) is amended--
(1) by redesignating paragraphs (5), (6), (7), (8), (9),
and (10) as paragraphs (6), (7), (8), (9), (10), and (11),
respectively;
(2) by inserting after paragraph (4), the following new
paragraph:
``(5) Waiver of schedule when necessary to achieve safe and
sound allocation of examiner resources.--Notwithstanding
paragraphs (1), (2), (3), and (4), an appropriate Federal
banking agency may make adjustments in the examination cycle
for an insured depository institution if necessary to allocate
available resources of examiners in a manner that provides for
the safety and soundness of, and the effective examination and
supervision of, insured depository institutions.''; and
(3) in paragraphs (8) and (9), as so redesignated, by
striking ``paragraph (6)'' and inserting ``paragraph (7)''.

SEC. 602. INTERAGENCY DATA SHARING.

(a) Federal Banking Agencies.--Section 7(a)(2) of the Federal
Deposit Insurance Act (12 U.S.C. 1817(a)(2)) is amended by adding at
the end the following new subparagraph:
``(C) Data sharing with other agencies and
persons.--In addition to reports of examination,
reports of condition, and other reports required to be
regularly provided to the Corporation (with respect to
all insured depository institutions, including a
depository institution for which the Corporation has
been appointed conservator or receiver) or an
appropriate State bank supervisor (with respect to a
State depository institution) under subparagraph (A) or
(B), a Federal banking agency may, in the agency's
discretion, furnish any report of examination or other
confidential supervisory information concerning any
depository institution or other entity examined by such
agency under authority of any Federal law, to--
``(i) any other Federal or State agency or
authority with supervisory or regulatory
authority over the depository institution or
other entity;
``(ii) any officer, director, or receiver
of such depository institution or entity; and
``(iii) any other person the Federal
banking agency determines to be appropriate.''.
(b) National Credit Union Administration.--Section 202(a) of the
Federal Credit Union Act (12 U.S.C. 1782(a)) is amended by adding at
the end the following new paragraph:
``(8) Data sharing with other agencies and persons.--In
addition to reports of examination, reports of condition, and
other reports required to be regularly provided to the Board
(with respect to all insured credit unions, including a credit
union for which the Corporation has been appointed conservator
or liquidating agent) or an appropriate State commission,
board, or authority having supervision of a State-chartered
credit union, the Board may, in the Board's discretion, furnish
any report of examination or other confidential supervisory
information concerning any credit union or other entity
examined by the Board under authority of any Federal law, to--
``(A) any other Federal or State agency or
authority with supervisory or regulatory authority over
the credit union or other entity;
``(B) any officer, director, or receiver of such
credit union or entity; and
``(C) any other institution-affiliated party of
such credit union or entity the Board determines to be
appropriate.''.

SEC. 603. PENALTY FOR UNAUTHORIZED PARTICIPATION BY CONVICTED
INDIVIDUAL.

Section 19 of the Federal Deposit Insurance Act (12 U.S.C. 1829) is
amended by adding at the end the following new subsection:
``(c) Noninsured Banks.--Subsections (a) and (b) shall apply to a
noninsured national bank and a noninsured State member bank, and any
agency or noninsured branch (as such terms are defined in section 1(b)
of the International Banking Act of 1978) of a foreign bank as if such
bank, branch, or agency were an insured depository institution, except
such subsections shall be applied for purposes of this subsection by
substituting the agency determined under the following paragraphs for
`Corporation' each place such term appears in such subsections:
``(1) The Comptroller of the Currency, in the case of a
noninsured national bank or any Federal agency or noninsured
Federal branch of a foreign bank.
``(2) The Board of Governors of the Federal Reserve System,
in the case of a noninsured State member bank or any State
agency or noninsured State branch of a foreign bank.''.

SEC. 604. AMENDMENT PERMITTING THE DESTRUCTION OF OLD RECORDS OF A
DEPOSITORY INSTITUTION BY THE FDIC AFTER THE APPOINTMENT
OF THE FDIC AS RECEIVER.

Section 11(d)(15)(D) of the Federal Deposit Insurance Act (12
U.S.C. 1821(d)(15)(D)) is amended--
(1) by striking ``Recordkeeping requirement.--After the end
of the 6-year period'' and inserting ``Recordkeeping
requirement.--
``(i) In general.--Except as provided in
clause (ii), after the end of the 6-year
period'';
(2) by striking ``to be unnecessary'' and inserting ``are
unnecessary and not relevant to any pending or reasonably
probable future litigation''; and
(3) by adding at the end the following new clause:
``(ii) Old records.--In the case of records
of an insured depository institution which--
``(I) are at least 10 years old, as
of the date the Corporation is
appointed as the receiver of such
depository institution; and
``(II) are unnecessary and not
relevant to any pending or reasonably
probable future litigation, as provided
in clause (i),
the Corporation may destroy such records in
accordance with clause (i) any time after such
appointment is final without regard to the 6-
year period of limitation contained in such
clause.''.

SEC. 605. MODERNIZATION OF RECORDKEEPING REQUIREMENT.

Subsection (f) of section 10 of the Federal Deposit Insurance Act
(12 U.S.C. 1820(f)) is amended to read as follows:
``(f) Preservation of Agency Records.--
``(1) In general.--A Federal banking agency may cause any
and all records, papers, or documents kept by the agency or in
the possession or custody of the agency to be--
``(A) photographed or microphotographed or
otherwise reproduced upon film; or
``(B) preserved in any electronic medium or format
which is capable of--
``(i) being read or scanned by computer;
and
``(ii) being reproduced from such
electronic medium or format by printing or any
other form of reproduction of electronically
stored data.
``(2) Treatment as original records.--Any photographs,
microphotographs, or photographic film or copies thereof
described in paragraph (1)(A) or reproduction of electronically
stored data described in paragraph (1)(B) shall be deemed to be
an original record for all purposes, including introduction in
evidence in all State and Federal courts or administrative
agencies and shall be admissible to prove any act, transaction,
occurrence, or event therein recorded.
``(3) Authority of the federal banking agencies.--Any
photographs, microphotographs, or photographic film or copies
thereof described in paragraph (1)(A) or reproduction of
electronically stored data described in paragraph (1)(B) shall
be preserved in such manner as the Federal banking agency shall
prescribe and the original records, papers, or documents may be
destroyed or otherwise disposed of as the Federal banking
agency may direct.''.

SEC. 606. STREAMLINING REPORTS OF CONDITION.

Section 7(a) of the Federal Deposit Insurance Act (12 U.S.C.
1817(a)) is amended by adding the following new paragraph:
``(11) Streamlining reports of condition.--
``(A) Review of information and schedules.--Before
the end of the 1-year period beginning on the date of
the enactment of the Financial Services Regulatory
Relief Act of 2005 and before the end of each 5-year
period thereafter, each Federal banking agency shall,
in consultation with the other relevant Federal banking
agencies, review the information and schedules that are
required to be filed by an insured depository
institution in a report of condition required under
paragraph (3).
``(B) Reduction or elimination of information found
to be unnecessary.--After completing the review
required by subparagraph (A), a Federal banking agency,
in consultation with the other relevant Federal banking
agencies, shall reduce or eliminate any requirement to
file information or schedules under paragraph (3)
(other than information or schedules that are otherwise
required by law) if the agency determines that the
continued collection of such information or schedules
is no longer necessary or appropriate.''.

SEC. 607. EXPANSION OF ELIGIBILITY FOR 18-MONTH EXAMINATION SCHEDULE
FOR COMMUNITY BANKS.

Paragraph (4)(A) of section 10(d) of the Federal Deposit Insurance
Act (12 U.S.C. 1820(d)) is amended by striking ``$250,000,000'' and
inserting ``$1,000,000,000''.

SEC. 608. SHORT FORM REPORTS OF CONDITION FOR CERTAIN COMMUNITY BANKS.

(a) In General.--Section 7(a) of the Federal Deposit Insurance Act
(12 U.S.C. 1817(a)) is amended by inserting after paragraph (11) (as
added by section 606 of this title) the following new paragraph:
``(12) Short form reports of condition for community
banks.--
``(A) In general.--With respect to reports of
condition required under paragraph (3) for each
calendar quarter, an insured depository institution
described in subparagraphs (A), (B), (C), and (D) of
section 10(d)(4) may submit a short form of any such
report of condition in 2 nonsequential quarters of any
calendar year.
``(B) Short form defined.--The term `short form',
when used in connection with any report of condition
required under paragraph (3), means a report of
condition in a format established by the appropriate
Federal banking agency, after notice and opportunity
for comment, that--
``(i) is significantly and materially less
burdensome for the insured depository
institution to prepare than the format of the
report of condition required under paragraph
(3); and
``(ii) provides sufficient material
information for the appropriate Federal banking
agency to assure the maintenance of the safe
and sound condition of the depository
institution and safe and sound practices.''.
(b) Regulations.--Any regulation required to carry out the
amendment made by subsection (a) shall be published in final form
before the end of the 6-month period beginning on the date of the
enactment of this Act.

SEC. 609. CLARIFICATION OF EXTENT OF SUSPENSION, REMOVAL, AND
PROHIBITION AUTHORITY OF FEDERAL BANKING AGENCIES IN
CASES OF CERTAIN CRIMES BY INSTITUTION-AFFILIATED
PARTIES.

(a) Insured Depository Institutions.--
(1) In general.--Section 8(g)(1) of the Federal Deposit
Insurance Act (12 U.S.C. 1818(g)(1)) is amended--
(A) in subparagraph (A)--
(i) by striking ``is charged in any
information, indictment, or complaint, with the
commission of or participation in'' and
inserting ``is the subject of any information,
indictment, or complaint, involving the
commission of or participation in'';
(ii) by striking ``may pose a threat to the
interests of the depository institution's
depositors or may threaten to impair public
confidence in the depository institution,'' and
insert ``posed, poses, or may pose a threat to
the interests of the depositors of, or
threatened, threatens, or may threaten to
impair public confidence in, any relevant
depository institution (as defined in
subparagraph (E)),''; and
(iii) by striking ``affairs of the
depository institution'' and inserting
``affairs of any depository institution'';
(B) in subparagraph (B)(i), by striking ``the
depository institution'' and inserting ``any depository
institution that the subject of the notice is
affiliated with at the time the notice is issued'';
(C) in subparagraph (C)(i)--
(i) by striking ``may pose a threat to the
interests of the depository institution's
depositors or may threaten to impair public
confidence in the depository institution,'' and
insert ``posed, poses, or may pose a threat to
the interests of the depositors of, or
threatened, threatens, or may threaten to
impair public confidence in, and relevant
depository institution (as defined in
subparagraph (E)),''; and
(ii) by striking ``affairs of the
depository institution'' and inserting
``affairs of any depository institution'';
(D) in subparagraph (C)(ii), by striking ``affairs
of the depository institution'' and inserting ``affairs
of any depository institution'';
(E) in subparagraph (D)(i), by striking ``the
depository institution'' and inserting ``any depository
institution that the subject of the order is affiliated
with at the time the order is issued''; and
(F) by adding at the end the following new
subparagraph:
``(E) Relevant depository institution.--For
purposes of this subsection, the term `relevant
depository institution' means any depository
institution of which the party is or was an
institution-affiliated party at the time--
``(i) the information, indictment or
complaint described in subparagraph (A) was
issued; or
``(ii) the notice is issued under
subparagraph (A) or the order is issued under
subparagraph (C)(i).''.
(2) Clerical amendment.--The heading for section 8(g) of
the Federal Deposit Insurance Act (12 U.S.C. 1818(g)) is
amended to read as follows:
``(g) Suspension, Removal, and Prohibition From Participation
Orders in the Case of Certain Criminal Offenses.--''.
(b) Insured Credit Unions.--
(1) In general.--Section 206(i)(1) of the Federal Credit
Union Act (12 U.S.C. 1786(i)(1)) is amended--
(A) in subparagraph (A), by striking ``the credit
union'' each place such term appears and inserting
``any credit union'';
(B) in subparagraph (B)(i), by inserting ``of which
the subject of the order is, or most recently was, an
institution-affiliated party'' before the period at the
end;
(C) in subparagraph (C)--
(i) by striking ``the credit union'' each
place such term appears and inserting ``any
credit union''; and
(ii) by striking ``the credit union's'' and
inserting ``any credit union's'';
(D) in subparagraph (D)(i), by striking ``upon such
credit union'' and inserting ``upon the credit union of
which the subject of the order is, or most recently
was, an institution-affiliated party''; and
(E) by adding at the end the following new
subparagraph:
``(E) Continuation of authority.--The Board may
issue an order under this paragraph with respect to an
individual who is an institution-affiliated party at a
credit union at the time of an offense described in
subparagraph (A) without regard to--
``(i) whether such individual is an
institution-affiliated party at any credit
union at the time the order is considered or
issued by the Board; or
``(ii) whether the credit union at which
the individual was an institution-affiliated
party at the time of the offense remains in
existence at the time the order is considered
or issued by the Board.''.
(2) Clerical amendment.--Section 206(i) of the Federal
Credit Union Act (12 U.S.C. 1786(i)) is amended by striking
``(i)'' at the beginning and inserting the following new
subsection heading:
``(i) Suspension, Removal, and Prohibition From Participation
Orders in the Case of Certain Criminal Offenses.--''.

SEC. 610. STREAMLINING DEPOSITORY INSTITUTION MERGER APPLICATION
REQUIREMENTS.

(a) In General.--Paragraph (4) of section 18(c) of the Federal
Deposit Insurance Act (12 U.S.C. 1828(c)) is amended to read as
follows:
``(4) Reports on competitive factors.--
``(A) Request for report.--In the interests of
uniform standards and subject to subparagraph (B), the
responsible agency shall, before acting on any
application for approval of a merger transaction--
``(i) request a report on the competitive
factors involved from the Attorney General; and
``(ii) provide a copy of the request to the
Corporation (when the Corporation is not the
responsible agency).
``(B) Concurrent consideration.--The responsible
agency shall not be required to make a request under
subparagraph (A) before acting on an application for
approval of a merger transaction if--
``(i) the agency finds that it must act
immediately in order to prevent the probable
failure of a depository institution involved in
the transaction; or
``(ii) the transaction consists of a merger
between an insured depository institution and 1
or more affiliates of the depository
institution.
``(C) Furnishing of report.--The report requested
under subparagraph (A) shall be furnished by the
Attorney General to the responsible agency--
``(i) not more than 30 calendar days after
the date on which the Attorney General received
the request; or
``(ii) not more than 10 calendar days after
such date, if the requesting agency advises the
Attorney General that an emergency exists
requiring expeditious action.''.
(b) Technical and Conforming Amendment.--Section 18(c)(6) of the
Federal Deposit Insurance Act (12 U.S.C. 1828(c)(6)) is amended--
(1) in the second sentence by striking ``banks or savings
associations involved'' and inserting the following: ``insured
depository institutions involved, or if the proposed merger
transaction is solely between an insured depository institution
and 1 or more of affiliates of the depository institution,''
and
(2) by striking the penultimate sentence and inserting the
following: ``If the agency has advised the Attorney General
under paragraph (4)(C)(ii) of the existence of an emergency
requiring expeditious action and has requested a report on the
competitive factors within 10 days, the transaction may not be
consummated before the fifth calendar day after the date of
approval by the agency.''.

SEC. 611. INCLUSION OF DIRECTOR OF THE OFFICE OF THRIFT SUPERVISION IN
LIST OF BANKING AGENCIES REGARDING INSURANCE CUSTOMER
PROTECTION REGULATIONS.

Section 47(g)(2)(B)(i) of the Federal Deposit Insurance Act (12
U.S.C. 1831x(g)(2)(B)(i)) is amended by inserting ``the Director of the
Office of Thrift Supervision,'' after ``Comptroller of the Currency,''.

SEC. 612. PROTECTION OF CONFIDENTIAL INFORMATION RECEIVED BY FEDERAL
BANKING REGULATORS FROM FOREIGN BANKING SUPERVISORS.

Section 15 of the International Banking Act of 1978 (12 U.S.C.
3109) is amended by adding at the end the following new subsection:
``(c) Confidential Information Received From Foreign Supervisors.--
``(1) In general.--Except as provided in paragraph (3), a
Federal banking agency shall not be compelled to disclose
information received from a foreign regulatory or supervisory
authority if--
``(A) the Federal banking agency determines that
the foreign regulatory or supervisory authority has, in
good faith, determined and represented to such Federal
banking agency that public disclosure of the
information would violate the laws applicable to that
foreign regulatory or supervisory authority; and
``(B) the relevant Federal banking agency obtained
such information pursuant to--
``(i) such procedures as the Federal
banking agency may establish for use in
connection with the administration and
enforcement of Federal banking laws; or
``(ii) a memorandum of understanding or
other similar arrangement between the Federal
banking agency and the foreign regulatory or
supervisory authority.
``(2) Treatment under title 5, united states code.--For
purposes of section 552 of title 5, United States Code, this
subsection shall be treated as a statute described in
subsection (b)(3)(B) of such section.
``(3) Savings provision.--No provision of this section
shall be construed as--
``(A) authorizing any Federal banking agency to
withhold any information from any duly authorized
committee of the House of Representatives or the
Senate; or
``(B) preventing any Federal banking agency from
complying with an order of a court of the United States
in an action commenced by the United States or such
agency.
``(4) Federal banking agency defined.--For purposes of this
subsection, the term `Federal banking agency' means the Board,
the Comptroller, the Federal Deposit Insurance Corporation, and
the Director of the Office of Thrift Supervision.''.

SEC. 613. PROHIBITION ON PARTICIPATION BY CONVICTED INDIVIDUAL.

(a) Extension of Automatic Prohibition.--Section 19 of the Federal
Deposit Insurance Act (12 U.S.C. 1829) is amended by inserting after
subsection (c) (as added by section 603 of this title) the following
new subsections:
``(d) Bank Holding Companies.--Subsections (a) and (b) shall apply
to any company (other than a foreign bank) that is a bank holding
company and any organization organized and operated under section 25A
of the Federal Reserve Act or operating under section 25 of the Federal
Reserve Act as if such bank holding company or organization were an
insured depository institution, except such subsections shall be
applied for purposes of this subsection by substituting `Board of
Governors of the Federal Reserve System' for `Corporation' each place
such term appears in such subsections.
``(e) Savings and Loan Holding Companies.--Subsections (a) and (b)
shall apply to any savings and loan holding company and any subsidiary
(other than a savings association) of a savings and loan holding
company as if such savings and loan holding company or subsidiary were
an insured depository institution, except such subsections shall be
applied for purposes of this subsection by substituting `Director of
the Office of Thrift Supervision' for `Corporation' each place such
term appears in such subsections.''.
(b) Enhanced Discretion to Remove Convicted Individuals.--Section
8(e)(2)(A) of the Federal Deposit Insurance Act (12 U.S.C.
1818(e)(2)(A)) is amended--
(1) by striking ``or'' at the end of clause (ii);
(2) by striking the comma at the end of clause (iii) and
inserting ``; or''; and
(3) by adding at the end the following new clause:
``(iv) an institution-affiliated party of a
subsidiary (other than a bank) of a bank
holding company has been convicted of any
criminal offense involving dishonesty or a
breach of trust, or has agreed to enter into a
pretrial diversion or similar program in
connection with a prosecution for such an
offense,''.

SEC. 614. CLARIFICATION THAT NOTICE AFTER SEPARATION FROM SERVICE MAY
BE MADE BY AN ORDER.

(a) In General.--Section 8(i)(3) of the Federal Deposit Insurance
Act (12 U.S.C. 1818(i)(3)) is amended by inserting ``or order'' after
``notice'' each place such term appears.
(b) Technical and Conforming Amendment.--The heading for section
8(i)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1818(i)(3)) is
amended by inserting ``or Order'' after ``Notice''.

SEC. 615. ENFORCEMENT AGAINST MISREPRESENTATIONS REGARDING FDIC DEPOSIT
INSURANCE COVERAGE.

(a) In General.--Section 18(a) of the Federal Deposit Insurance Act
(12 U.S.C. 1828(a)) is amended by adding at the end the following new
paragraph:
``(4) False advertising, misuse of fdic names, and
misrepresentation to indicate insured status.--
``(A) Prohibition on false advertising and misuse
of fdic names.--No person may--
``(i) use the terms `Federal Deposit',
`Federal Deposit Insurance', `Federal Deposit
Insurance Corporation', any combination of such
terms, or the abbreviation `FDIC' as part of
the business name or firm name of any person,
including any corporation, partnership,
business trust, association, or other business
entity; or
``(ii) use such terms or any other sign or
symbol as part of an advertisement,
solicitation, or other document,
to represent, suggest or imply that any deposit
liability, obligation, certificate or share is insured
or guaranteed by the Federal Deposit Insurance
Corporation, if such deposit liability, obligation,
certificate, or share is not insured or guaranteed by
the Corporation.
``(B) Prohibition on misrepresentations of insured
status.--No person may knowingly misrepresent--
``(i) that any deposit liability,
obligation, certificate, or share is federally
insured, if such deposit liability, obligation,
certificate, or share is not insured by the
Corporation; or
``(ii) the extent to which or the manner in
which any deposit liability, obligation,
certificate, or share is insured by the Federal
Deposit Insurance Corporation, if such deposit
liability, obligation, certificate, or share is
not insured by the Corporation to the extent or
in the manner represented.
``(C) Authority of fdic.--The Corporation shall
have--
``(i) jurisdiction over any person that
violates this paragraph, or aids or abets the
violation of this paragraph; and
``(ii) for purposes of enforcing the
requirements of this paragraph with regard to
any person--
``(I) the authority of the
Corporation under section 10(c) to
conduct investigations; and
``(II) the enforcement authority of
the Corporation under subsections (b),
(c), (d) and (i) of section 8,
as if such person were a state nonmember insured bank.
``(D) Other actions preserved.--No provision of
this paragraph shall be construed as barring any action
otherwise available, under the laws of the United
States or any State, to any Federal or State law
enforcement agency or individual.''.
(b) Enforcement Orders.--Section 8(c) of the Federal Deposit
Insurance Act (12 U.S.C. 1818(c)) is amended by adding at the end the
following new paragraph:
``(4) False advertising or misuse of names to indicate
insured status.--
``(A) Temporary order.--
``(i) In general.--If a notice of charges
served under subsection (b)(1) of this section
specifies on the basis of particular facts that
any person is engaged in conduct described in
section 18(a)(4), the Corporation may issue a
temporary order requiring--
``(I) the immediate cessation of
any activity or practice described,
which gave rise to the notice of
charges; and
``(II) affirmative action to
prevent any further, or to remedy any
existing, violation.
``(ii) Effect of order.--Any temporary
order issued under this subparagraph shall take
effect upon service.
``(B) Effective period of temporary order.--A
temporary order issued under subparagraph (A) shall
remain effective and enforceable, pending the
completion of an administrative proceeding pursuant to
subsection (b)(1) in connection with the notice of
charges--
``(i) until such time as the Corporation
shall dismiss the charges specified in such
notice; or
``(ii) if a cease-and-desist order is
issued against such person, until the effective
date of such order.
``(C) Civil money penalties.--Violations of section
18(a)(4) shall be subject to civil money penalties as
set forth in subsection (i) in an amount not to exceed
$1,000,000 for each day during which the violation
occurs or continues.''.
(c) Technical and Conforming Amendments.--
(1) Section 18(a)(3) of the Federal Deposit Insurance Act
(12 U.S.C. 1828(a)) is amended--
(A) in the 1st sentence by striking ``of this
subsection'' and inserting ``of paragraphs (1) and
(2)'';
(B) by striking the 2nd sentence; and
(C) in the 3rd sentence, by striking ``of this
subsection'' and inserting ``of paragraphs (1) and
(2)''.
(2) The heading for subsection (a) of section 18 of the
Federal Deposit Insurance Act (12 U.S.C. 1828(a)) is amended by
striking ``Insurance Logo.--'' and inserting ``Representations
of Deposit Insurance.--''.

SEC. 616. CHANGES REQUIRED TO SMALL BANK HOLDING COMPANY POLICY
STATEMENT ON ASSESSMENT OF FINANCIAL AND MANAGERIAL
FACTORS.

(a) Small Bank Holding Company Policy Statement on Assessment of
Financial and Managerial Factors.--
(1) In general.--Before the end of the 6-month period
beginning on the date of the enactment of this Act, the Board
of Governors of the Federal Reserve System shall publish in the
Federal Register proposed revisions to the Small Bank Holding
Company Policy Statement on Assessment of Financial and
Managerial Factors (12 C.F.R. part 225--appendix C) that
provide that the policy shall apply to a bank holding company
which has pro forma consolidated assets of less than
$1,000,000,000 and that--
(A) is not engaged in any nonbanking activities
involving significant leverage; and
(B) does not have a significant amount of
outstanding debt that is held by the general public.
(2) Adjustment of amount.--The Board of Governors of the
Federal Reserve System shall annually adjust the dollar amount
referred to in paragraph (1) in the Small Bank Holding Company
Policy Statement on Assessment of Financial and Managerial
Factors by an amount equal to the percentage increase, for the
most recent year, in total assets held by all insured
depository institutions, as determined by the Board.
(b) Increase in Debt-to-equity Ratio of Small Bank Holding
Company.--Before the end of the 6-month period beginning on the date of
the enactment of this Act, the Board of Governors of the Federal
Reserve System shall publish in the Federal Register proposed revisions
to the Small Bank Holding Company Policy Statement on Assessment of
Financial and Managerial Factors (12 C.F.R. part 225--appendix C) such
that the debt-to-equity ratio allowable for a small bank holding
company in order to remain eligible to pay a corporate dividend and to
remain eligible for expedited processing procedures under Regulation Y
of the Board of Governors of the Federal Reserve System would increase
from 1:1 to 3:1.

SEC. 617. EXCEPTION TO ANNUAL PRIVACY NOTICE REQUIREMENT UNDER THE
GRAMM-LEACH-BLILEY ACT.

Section 503 of the Gramm-Leach-Bliley Act (15 U.S.C. 6803) is
amended by adding the following new subsections:
``(c) Exception to Annual Notice Requirement.--A financial
institution that--
``(1) provides nonpublic personal information only in
accordance with the provisions of subsection (b)(2) or (e) of
section 502 or regulations prescribed under section 504(b);
``(2) does not share information with affiliates under
section 603(d)(2)(A) of the Fair Credit Reporting Act; and
``(3) has not changed its policies and practices with
regard to disclosing nonpublic personal information from the
policies and practices that were disclosed in the most recent
disclosure sent to consumers in accordance with this
subsection,
shall not be required to provide an annual disclosure under this
subsection until such time as the financial institution fails to comply
with any criteria described in paragraph (1), (2), or (3).
``(d) Exception to Notice Requirement.--A financial institution
shall not be required to provide any disclosure under this section if--
``(1) the financial institution is licensed by a State and
is subject to existing regulation of consumer confidentiality
that prohibits disclosure of nonpublic personal information
without knowing and expressed consent of the consumer in the
form of laws, rules, or regulation of professional conduct or
ethics promulgated either by the court of highest appellate
authority or by the principal legislative body or regulatory
agency or body of any State of the United States, the District
of Columbia, any territory of the United States, Puerto Rico,
Guam, American Samoa, the Trust Territory of the Pacific
Islands, the Virgin Islands, or the Northern Mariana Islands;
or
``(2) the financial institution is licensed by a State and
becomes subject to future regulation of consumer
confidentiality that prohibits disclosure of nonpublic personal
information without knowing and expressed consent of the
consumer in the form of laws, rules, or regulation of
professional conduct or ethics promulgated either by the court
of highest appellate authority or by the principal legislative
body or regulatory agency or body of any State of the United
States, the District of Columbia, any territory of the United
States, Puerto Rico, Guam, American Samoa, the Trust Territory
of the Pacific Islands, the Virgin Islands, or the Northern
Mariana Islands.''.

SEC. 618. BIENNIAL REPORTS ON THE STATUS OF AGENCY EMPLOYMENT OF
MINORITIES AND WOMEN.

(a) In General.--Before December 31, 2005, and the end of each 2-
year period beginning after such date, each Federal banking agency
shall submit a report to the Congress on the status of the employment
by the agency of minority individuals and women.
(b) Factors to Be Included.--The report shall include a detailed
assessment of each of the following:
(1) The extent of hiring of minority individuals and women
by the agency as of the time the report is prepared.
(2) The successes achieved and challenges faced by the
agency in operating minority and women outreach programs.
(3) Challenges the agency may face in finding qualified
minority individual and women applicants.
(4) Such other information, findings, and conclusions, and
recommendations for legislative or agency action, as the agency
may determine to be appropriate to include in the report.
(c) Definitions.--For purposes of this section, the following
definitions shall apply:
(1) Federal banking agency.--The term ``Federal banking
agency''--
(A) has the same meaning as in section 3(z) of the
Federal Deposit Insurance Act; and
(B) includes the National Credit Union
Administration.
(2) Minority.--The term ``minority'' has the same meaning
as in section 1204(c)(3) of the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989.

SEC. 619. COORDINATION OF STATE EXAMINATION AUTHORITY.

Section 10(h) of the Federal Deposit Insurance Act (12 U.S.C.
1820(h)) is amended to read as follows:
``(h) Coordination of Examination Authority.--
``(1) State bank supervisors of home and host states.--
``(A) Home state of bank.--The appropriate State
bank supervisor of the home State of an insured State
bank has authority to examine and supervise the bank.
``(B) Host state branches.--The State bank
supervisor of the home State of an insured State bank
and any State bank supervisor of an appropriate host
State shall exercise their respective authority to
supervise and examine the branches of the bank in a
host State in accordance with the terms of any
applicable cooperative agreement between the home State
bank supervisor and the State bank supervisor of the
relevant host State.
``(C) Supervisory fees.--Except as expressly
provided in a cooperative agreement between the State
bank supervisors of the home State and any host State
of an insured State bank, only the State bank
supervisor of the home State of an insured State bank
may levy or charge State supervisory fees on the bank.
``(2) Host state examination.--
``(A) In general.--With respect to a branch
operated in a host State by an out-of-State insured
State bank that resulted from an interstate merger
transaction approved under section 44 or that was
established in such State pursuant to section 5155(g)
of the Revised Statutes, the third undesignated
paragraph of section 9 of the Federal Reserve Act or
section 18(d)(4) of this Act, the appropriate State
bank supervisor of such host State may--
``(i) with written notice to the State bank
supervisor of the bank's home State and subject
to the terms of any applicable cooperative
agreement with the State bank supervisor of
such home State, examine such branch for the
purpose of determining compliance with host
State laws that are applicable pursuant to
section 24(j) of this Act, including those that
govern community reinvestment, fair lending,
and consumer protection; and
``(ii) if expressly permitted under and
subject to the terms of a cooperative agreement
with the State bank supervisor of the bank's
home State or if such out-of-State insured
State bank has been determined to be in a
troubled condition by either the State bank
supervisor of the bank's home State or the
bank's appropriate Federal banking agency,
participate in the examination of the bank by
the State bank supervisor of the bank's home
State to ascertain that the activities of the
branch in such host State are not conducted in
an unsafe or unsound manner.
``(B) Notice of determination.--
``(i) In general.--The State bank
supervisor of the home State of an insured
State bank should notify the State bank
supervisor of each host State of the bank if
there has been a final determination that the
bank is in a troubled condition.
``(ii) Timing of notice.--The State bank
supervisor of the home State of an insured
State bank should provide notice under clause
(i) as soon as reasonably possible but in all
cases within 15 business days after the State
bank supervisor has made such final
determination or has received written
notification of such final determination.
``(3) Host state enforcement.--If the State bank supervisor
of a host State determines that a branch of an out-of-State
State insured State bank is violating any law of the host State
that is applicable to such branch pursuant to section 24(j) of
this Act, including a law that governs community reinvestment,
fair lending, or consumer protection, the State bank supervisor
of the host State or, to the extent authorized by the law of
the host State, a host State law enforcement officer may, with
written notice to the State bank supervisor of the bank's home
State and subject to the terms of any applicable cooperative
agreement with the State bank supervisor of the bank's home
State, undertake such enforcement actions and proceedings as
would be permitted under the law of the host State as if the
branch were a bank chartered by that host State.
``(4) Cooperative agreement.--
``(A) In general.--The State bank supervisors from
2 or more States may enter into cooperative agreements
to facilitate State regulatory supervision of State
banks, including cooperative agreements relating to the
coordination of examinations and joint participation in
examinations. For purposes of this subsection (h), the
term `cooperative agreement' means a written agreement
that is signed by the home State bank supervisor and
host State bank supervisor to facilitate State
regulatory supervision of State banks and includes
nationwide or multi-state cooperative agreements and
cooperative agreements solely between the home State
and host State.
``(B) Rule of construction.--Except for State bank
supervisors, no provision of this subsection relating
to such cooperative agreements shall be construed as
limiting in any way the authority of home and host
State law enforcement officers, regulatory supervisors,
or other officials that have not signed such
cooperative agreements to enforce host State laws that
are applicable to a branch of an out-of-State insured
State bank located in the host State pursuant to
section 24(j) of this Act.
``(5) Federal regulatory authority.--No provision of this
subsection shall be construed as limiting in any way the
authority of any Federal banking agency.
``(6) State taxation authority not affected.--No provision
of this subsection (h) shall be construed as affecting the
authority of any State or political subdivision of any State to
adopt, apply, or administer any tax or method of taxation to
any bank, bank holding company, or foreign bank, or any
affiliate of any bank, bank holding company, or foreign bank,
to the extent such tax or tax method is otherwise permissible
by or under the Constitution of the United States or other
Federal law.
``(7) Definitions.--For purpose of this section, the
following definition shall apply:
``(A) Host state, home state, out-of-state bank.--
The terms `host State', `home State', and `out-of-State
bank' have the same meanings as in section 44(g).
``(B) State supervisory fees.--The term `State
supervisory fees' means assessments, examination fees,
branch fees, license fees, and all other fees that are
levied or charged by a State bank supervisor directly
upon an insured State bank or upon branches of an
insured State bank.
``(C) Troubled condition.--Solely for purposes of
subparagraph (2)(B) of this subsection (h), an insured
State bank has been determined to be in `troubled
condition' if the bank--
``(i) has a composite rating, as determined
in its most recent report of examination, of 4
or 5 under the Uniform Financial Institutions
Ratings System (UFIRS); or
``(ii) is subject to a proceeding initiated
by the Corporation for termination or
suspension of deposit insurance; or
``(iii) is subject to a proceeding
initiated by the State bank supervisor of the
bank's home State to vacate, revoke, or
terminate the charter of the bank, or to
liquidate the bank, or to appoint a receiver
for the bank.
``(D) Final determination.--For the purposes of
paragraph (2)(B), the term `final determination' means
the transmittal of a report of examination to the bank
or transmittal of official notice of proceedings to the
bank.''.

SEC. 620. NONWAIVER OF PRIVILEGES.

(a) Insured Depository Institutions.--Section 18 of the Federal
Deposit Insurance Act (12 U.S.C. 1828) is amended by adding at the end
the following new subsection:
``(x) Privileges not Affected by Disclosure to Banking Agency or
Supervisor.--
``(1) In general.--The submission by any person of any
information to any Federal banking agency, State bank
supervisor, or foreign banking authority for any purpose in the
course of any supervisory or regulatory process of such agency,
supervisor, or authority shall not be construed as waiving,
destroying, or otherwise affecting any privilege such person
may claim with respect to such information under Federal or
State law as to any person or entity other than such agency,
supervisor, or authority.
``(2) Rule of construction.--No provision of paragraph (1)
may be construed as implying or establishing that--
``(A) any person waives any privilege applicable to
information that is submitted or transferred under any
circumstance to which paragraph (1) does not apply; or
``(B) any person would waive any privilege
applicable to any information by submitting the
information to any Federal banking agency, State bank
supervisor, or foreign banking authority, but for this
subsection.''.
(b) Insured Credit Unions.--Section 205 of the Federal Credit Union
Act (12 U.S.C.1785) is amended by adding at the end the following new
subsection:
``(j) Privileges not Affected by Disclosure to Banking Agency or
Supervisor.--
``(1) In general.--The submission by any person of any
information to the Administration, any State credit union
supervisor, or foreign banking authority for any purpose in the
course of any supervisory or regulatory process of such Board,
supervisor, or authority shall not be construed as waiving,
destroying, or otherwise affecting any privilege such person
may claim with respect to such information under Federal or
State law as to any person or entity other than such Board,
supervisor, or authority.
``(2) Rule of construction.--No provision of paragraph (1)
may be construed as implying or establishing that--
``(A) any person waives any privilege applicable to
information that is submitted or transferred under any
circumstance to which paragraph (1) does not apply; or
``(B) any person would waive any privilege
applicable to any information by submitting the
information to the Administration, any State credit
union supervisor, or foreign banking authority, but for
this subsection.''.

SEC. 621. RIGHT TO FINANCIAL PRIVACY ACT OF 1978 AMENDMENT.

Paragraph (1) of section 1101 of the Right to Financial Privacy Act
of 1978 (12 U.S.C. 3401) is amended by inserting ``(including any
lender who advances funds on pledges of personal property)'' after
``consumer finance institution''.

SEC. 622. DEPUTY DIRECTOR; SUCCESSION AUTHORITY FOR DIRECTOR OF THE
OFFICE OF THRIFT SUPERVISION.

(a) Establishment of Position of Deputy Director.--Section 3(c)(5)
of the Home Owners' Loan Act (12 U.S.C. 1462a(c)(5)) is amended to read
as follows:
``(5) Deputy director.--
``(A) In general.--The Secretary of the Treasury
shall appoint a Deputy Director and may appoint up to 3
additional Deputy Directors.
``(B) First deputy director.--If the Secretary of
the Treasury appoints more than 1 Deputy Director of
the Office, the Secretary shall designate one such
appointee as the First Deputy Director.
``(C) Duties.--Each Deputy Director appointed under
this paragraph shall take an oath of office and perform
such duties as the Director shall direct.
``(D) Compensation and benefits.--The Director
shall fix the compensation and benefits for each Deputy
Director in accordance with this Act.''.
(b) Service of Deputy Director as Acting Director.--Section 3(c)(3)
of the Home Owners' Loan Act (12 U.S.C. 1462a(c)(3)) is amended--
(1) by striking ``Vacancy.--A vacancy in the position of
Director'' and inserting ``Vacancy.--
``(A) In general.--A vacancy in the position of
Director''; and
(2) by adding at the end the following new subparagraphs:
``(B) Acting director.--
``(i) In general.--In the event of a
vacancy in the position of Director or during
the absence or disability of the Director, the
Deputy Director shall serve as Acting Director.
``(ii) Succession in case of 2 or more
deputy directors.--If there are 2 or more
Deputy Directors serving at the time a vacancy
in the position of Director occurs or the
absence or disability of the Director
commences, the First Deputy Director shall
serve as Acting Director under clause (i)
followed by such other Deputy Directors under
any order of succession the Director may
establish.
``(iii) Authority of acting director.--Any
Deputy Director, while serving as Acting
Director under this subparagraph, shall be
vested with all authority, duties, and
privileges of the Director under this Act and
any other provision of Federal law.''.

SEC. 623. LIMITATION ON SCOPE OF NEW AGENCY GUIDELINES.

(a) In General.--The provisions of the multi-agency guidance
Numbered 2003-1 issued by the Comptroller of the Currency, the Board of
Governors of the Federal Reserve System, the Federal Deposit Insurance
Corporation, and the Director of the Office of Thrift Supervision that
relate to minimum credit card payments and negative amortization--
(1) shall only apply to new credit card accounts
established by a creditor for a consumer after the date of the
enactment of this Act under an open end consumer credit plan;
and
(2) shall not apply to any outstanding balance on any
credit card account under an open end consumer credit plan as
of such date of enactment.
(b) Definitions.--For purposes of this section, the terms
``credit'', ``credit card'', ``creditor'', ``consumer'' and ``open end
credit plan'' have the same meanings as in section 103 of the Truth in
Lending Act.
(c) Sunset Provision.--This section shall not apply after the end
of the 3-year period beginning on the date of the enactment of this Act

TITLE VII--``BSA'' COMPLIANCE BURDEN REDUCTION

SEC. 701. EXCEPTION FROM CURRENCY TRANSACTION REPORTS FOR SEASONED
CUSTOMERS.

(a) Findings.--The Congress finds as follows:
(1) The completion of and filing of currency transaction
reports under section 5313 of title 31, United States Code,
poses a compliance burden on the financial industry.
(2) Due to the nature of the transactions or the persons
and entities conducting such transactions, certain such reports
as currently filed do not appear to be relevant to the
detection, deterrence, or investigation of financial crimes,
including money laundering and the financing of terrorism.
(3) However, the data contained in such reports can provide
valuable context for the analysis of other data derived
pursuant to subchapter II of chapter 53 of title 31, United
States Code, as well as investigative data, which provides
invaluable and indispensable information supporting efforts to
combat money laundering and other financial crimes.
(4) An exemption from the reporting requirements for
certain currency transactions that are of little or no value to
ongoing efforts of law enforcement agencies, financial
regulatory agencies, and the financial services industry to
investigate, detect, or deter financial crimes would serve to
balance the burden placed on members of the financial services
industry with the compelling need to produce and provide
meaningful information to policy-makers, financial regulators,
law enforcement, and intelligence agencies.
(5) The Secretary of the Treasury has by regulation, and in
accordance with section 5313 of title 31, United States Code,
implemented a process by which institutions may seek exemptions
from filing certain currency transaction reports based on
appropriate circumstances; however, the existing exemption
process has not adequately balanced the burden on the financial
industry with the Government's need for data to support its
efforts in combating financial crime.
(6) The act of providing notice to the Secretary of the
Treasury of designations of exemption provides meaningful
information to law enforcement officials on exempt customers
and enables law enforcement to obtain account information
through appropriate legal process; the act of providing notice
of designations of exemption complements other sections of
title 31, United States Code, whereby law enforcement can
locate financial institutions with relevant records relating to
a person of investigative interest, such as information
requests made pursuant to regulations implementing section
314(a) of the USA PATRIOT Act of 2001.
(7) A designation of exemption has no effect on
requirements for depository institutions to apply the full
range of anti-money laundering controls as set forth in
subchapter II of chapter 53 of title 31, United States Code,
including the requirement to apply the customer identification
program pursuant to Section 5326 of subchapter II of chapter 53
of title 31, United States Code, and the requirement to
identify, monitor, and, if appropriate, report suspicious
activity in accordance with section 5318(g) of title 31, United
States Code.
(8) The Federal banking agencies and the Financial Crimes
Enforcement Network have recently provided guidance through the
Federal Financial Institutions Examination Council Bank Secrecy
Act/Anti-Money Laundering Examination Manual on applying
appropriate levels of due diligence and identifying suspicious
activity by the types of cash-intensive businesses that
generally will be subject to exemption.
(b) Seasoned Customer Exemption.--
(1) In general.--Section 5313(e) of title 31, United States
Code, is amended to read as follows:
``(e) Qualified Customer Exemption.--
``(1) In general.--The Secretary of the Treasury shall
prescribe regulations within 270 days of the enactment of the
Financial Services Regulatory Relief Act of 2005 that exempt
any depository institution from filing a report pursuant to
this section in a transaction for the payment, receipt, or
transfer of United States coins or currency (or other monetary
instruments the Secretary of the Treasury prescribes) with a
qualified customer of the depository institution.
``(2) Qualified customer defined.--For purposes of this
section, the term `qualified customer', with respect to a
depository institution, has such meaning as the Secretary of
the Treasury shall prescribe, which shall include any person
that--
``(A) is incorporated or organized under the laws
of the United States or any State, including a sole
proprietorship, or is registered as and eligible to do
business within the United States or a State;
``(B) has maintained a deposit account with the
depository institution for at least 12 months; and
``(C) has engaged, using such account, in multiple
currency transactions that are subject to the reporting
requirements of subsection (a).
``(3) Regulations.--
``(A) In general.--The Secretary of the Treasury
shall prescribe regulations requiring a depository
institution to file a 1-time notice of designation of
exemption for each qualified customer of the depository
institution.
``(B) Form and content of exemption notice.--The
Secretary shall by regulation prescribe the form,
manner, content, and timing of the qualified customer
exemption notice; such notice shall include information
sufficient to identify the qualified customer and its
accounts.
``(C) Authority of secretary.--
``(i) In general.--The Secretary may
suspend, reject or revoke any qualified
customer exemption notice, in accordance with
criteria prescribed by the Secretary by
regulation.
``(ii) Conditions.--The Secretary may
establish conditions, in accordance with
criteria prescribed by regulation, under which
exempt qualified customers of an insured
depository institution that is merged with or
acquired by another insured depository
institution will continue to be treated as
designated exempt qualified customers of the
surviving or acquiring institution.''.
(c) 3-Year Review and Report.--Before the end of the 3-year period
beginning on the date of the enactment of this Act, the Secretary of
the Treasury, in consultation with the Attorney General, the Secretary
of the Department of Homeland Security, the Federal banking agencies,
the banking industry, and such other persons as the Secretary deems
appropriate, shall evaluate the operations and effect of this provision
and make recommendations to Congress as to any legislative action with
respect to this provision as the Secretary may determine to be
appropriate.

SEC. 702. REDUCTION IN INCONSISTENCIES IN MONETARY TRANSACTION
RECORDKEEPING AND REPORTING ENFORCEMENT AND EXAMINATION
REQUIREMENTS.

(a) Sense of the Congress.--It is the sense of the Congress that
inconsistencies and redundancies among regulations implementing
monetary transaction recordkeeping and reporting enforcement programs
under section 8 of the Federal Deposit Insurance Act, section 206(q) of
the Federal Credit Union Act, and chapter II of chapter 53 of title 31,
United States Code by the Secretary of the Treasury and the Federal
banking agencies--
(1) increase the difficulty depository institutions have in
complying with congressional intent in creating such
enforcement programs,
(2) reduce the transparency and clarity of the regulatory
regime;
(3) increase the potential for conflict among the various
regulations in the future; and
(4) contribute to the perception that various agencies
involved in the enforcement of the monetary transaction
recordkeeping and reporting requirements apply such
requirements inconsistently.
(b) Agency Coordination of Monetary Transaction Recordkeeping and
Reporting Requirements.--
(1) Enforcement programs.--
(A) Federal deposit insurance act.--Section 8(s) of
the Federal Deposit Insurance Act (12 U.S.C. 1818(s))
is amended by adding at the end the following new
paragraph:
``(4) Coordination on uniform requirements.--In prescribing
regulations under paragraph (1), the Federal banking agencies,
acting through the Financial Institutions Examination Council,
shall--
``(A) consult with each other, the National Credit
Union Administration Board, and the Secretary of the
Treasury; and
``(B) take such action as may be necessary to
ensure that the requirements for procedures established
pursuant to such regulations, and the examination
standards for reviewing such procedures, are congruent
and reasonably uniform (taking into account differences
in the form and function of the institutions subject to
such requirements).''.
(B) Federal credit union act.--Section 206(q) of
the Federal Credit Union Act (12 U.S.C. 1786(q)) is
amended by adding at the end the following new
paragraph:
``(4) Coordination on uniform requirements.--In prescribing
regulations under paragraph (1), the Board, acting through the
Financial Institutions Examination Council, shall--
``(A) consult with the Federal banking agencies and
the Secretary of the Treasury; and
``(B) take such action as may be necessary to
ensure that the requirements for procedures established
pursuant to such regulations, and the examination
standards for reviewing such procedures, are congruent
and reasonably uniform (taking into account differences
in the form and function of the institutions subject to
such requirements).''.
(2) Examination standards and disputes.--Section 1006 of
the Federal Financial Institutions Examination Council Act of
1978 (12 U.S.C. 3305) is amended by adding at the end the
following new subsection:
``(h) Monetary Transaction Recordkeeping and Reporting
Requirements.--The Council and the Secretary of the Treasury shall
jointly establish--
``(1) uniform standards and principles applicable to the
examination of financial institutions to ensure compliance with
the requirements of subchapter II of chapter 53, United States
Code, sections 8(s) and 21 of the Federal Deposit Insurance
Act, and section 206(q) of the Federal Credit Union Act; and
``(2) a clear policy statement on appropriate processes for
resolving examiner-institution disagreements concerning the
application of subchapter II of chapter 53, United States Code,
sections 8(s) and 21 of the Federal Deposit Insurance Act, and
section 206(q) of the Federal Credit Union Act to financial
institutions.''.
(3) Effective date.--The Federal banking agencies, the
National Credit Union Administration Board, the Financial
Institutions Examination Council, and the Secretary of the
Treasury shall commence the discussions and consultations
required under the amendments made by this subsection as soon
as practicable after the date of the enactment of this Act.
(c) Review of and Report on Additional Regulatory or Legislative
Changes.--
(1) Review required.--Before the end of the 6-month period
beginning on the date of the enactment of this Act, the
Secretary of the Treasury shall conduct a review of the
potential inconsistencies in, or redundancies among, the
regulations pertaining to the application of the requirements
of subchapter II of chapter 53, United States Code, sections
8(s) and 21 of the Federal Deposit Insurance Act, and section
206(q) of the Federal Credit Union Act to financial
institutions.
(2) Report to congress and the financial institutions
examination council.--Upon completion of the review under
paragraph (1), the Secretary of the Treasury shall promptly
submit a report on the findings and conclusions of the
Secretary with respect to the review to the Committee on
Financial Services of the House of Representatives and the
Committee on Banking, Housing, and Urban Affairs of the Senate,
together with such recommendations for legislative and
administrative actions as the Secretary may determine to be
appropriate, and shall transmit a copy of such report to the
members of the Financial Institutions Examination Council.
(d) Reform of Application of Monetary Transaction Recordkeeping and
Reporting Requirements to Financial Institutions.--Before the end of
the 9-month period beginning on the date of the submission of the
report to Congress under subsection (c)(2), the Secretary of the
Treasury shall prescribe regulations implementing appropriate changes
to regulations within the jurisdiction of the Secretary to remedy
redundancies or inconsistencies identified in the review by, and
included in the recommendations of, the Secretary under subsection (c).

SEC. 703. ADDITIONAL REFORMS RELATING TO MONETARY TRANSACTION AND
RECORDKEEPING REQUIREMENTS APPLICABLE TO FINANCIAL
INSTITUTIONS.

(a) Notification of Officers and Directors of Financial
Institutions.--Before the end of the 6-month period beginning on the
date of the enactment of this Act, the Secretary of the Treasury
shall--
(1) review any regulation, guideline, or guidance of the
Secretary, any Federal banking agency, or the National Credit
Union Administration Board that serves as the basis for any
requirement to provide notice to any officer or director of a
depository institution of any suspicious activity report
submitted by the depository institution to the Secretary and
any such agency or Board;
(2) modify or eliminate any such requirement of the
Secretary that the Secretary determines is not necessary to
achieve the purposes of section 5318(g) of title 31, United
States Code; and
(3) make a recommendation to any Federal banking agency or
the National Credit Union Administration Board to modify or
eliminate any such requirement of such agency or Board that the
Secretary determines is not necessary to achieve the purposes
of section 5318(g) of title 31, United States Code.
(b) Elimination of Unnecessary Verification Requirements Applicable
to the Purchase of Financial Instruments.--Before the end of the 9-
month period beginning on the date of the enactment of this Act, the
Secretary of the Treasury shall--
(1) review all verification of customer identity
requirements as they relate to the purchases of monetary
instruments by customers of depository institutions, including
the regulations codified in section 103.29(a)(ii) of title 31,
Code of Federal Regulations; and
(2) modify or eliminate any customer identity requirement
related to the purchases of monetary instruments by customers
of depository institutions codified in section 103.29(a)(ii) of
title 31, Code of Federal Regulations, that the Secretary
determines is unnecessary.
(c) Elimination of Recurring Filings of Suspicious Activity Reports
on a Single Transaction.--Before the end of the 9-month period
beginning on the date of the enactment of this Act, the Secretary of
the Treasury, as appropriate, shall prescribe regulations, or issue
other forms of guidance, that eliminate the need for depository
institutions to file recurring suspicious activity reports on the same
transaction unless there has been a subsequent change in any pattern of
activity involving any person who was connected with the transaction.
(d) Electronic Acknowledgement of Certain Electronic Filings.--
Before the end of the 1-year period beginning on the date of the
enactment of this Act, the Director of the Financial Crimes Enforcement
Network shall put into effect a system for promptly furnishing an
electronic acknowledgement of receipt to any institution that files a
form with FinCEN under subchapter II of chapter 53 of title 31, United
States Code, through the Network's electronic filing system.

SEC. 704. STUDY BY COMPTROLLER GENERAL.

(a) Study Required.--The Comptroller General of the United States
shall conduct a study on methods and practices which would--
(1) reduce the overall number of currency transaction
reports filed with the Secretary of the Treasury under section
5313(a) of title 31, United States Code, while ensuring that
the needs of the Secretary, the Financial Crimes Enforcement
Network, law enforcement agencies, and financial institution
regulatory agencies continue to be met;
(2) improve financial institution utilization of the
current exemption provisions; and
(3) mitigate the difficulties in the current implementation
of such exemption provisions that limit the utility of the
exemption process for financial institutions.
(b) Report.--Before the end of the 6-month period beginning on the
date of the enactment of this Act, the Comptroller General shall submit
a report to the Committee on Financial Services of the House of
Representatives and the Committee on Banking, Housing, and Urban
Affairs of the Senate on the findings and conclusions of the
Comptroller General with respect to the study conducted under
subsection (a) and such recommendations for legislative and
administrative action as the Comptroller General may determine to be
appropriate.

SEC. 705. FEASIBILITY STUDY REQUIRED.

(a) In General.--For the purpose of simplifying, and increasing
compliance with, the various recordkeeping and reporting requirements
under subchapter II of chapter 53 of title 31, United States Code,
chapter 2 of title I of Public Law 91--508, and section 21 of the
Federal Deposit Insurance Act, and regulations prescribed under such
provisions of law, the Secretary of the Treasury (hereafter in this
section referred to as the ``Secretary'') shall conduct a study on the
feasibility of developing and implementing interfaces and templates for
use in electronic communications between financial institutions (as
defined in section 5312 of title 31, United States Code) and the
Secretary, the Financial Crimes Enforcement Network, and other Federal
financial institution regulatory agencies.
(b) Factors to Be Considered.--In conducting the study required
under subsection (a), the Secretary shall take into account--
(1) any procedures required to be maintained by financial
institutions under regulations prescribed pursuant to section
5318(a)(2) of title 31 of the United States Code and the manner
in which the use of interfaces and templates which might be
developed could lessen the burden of complying with such
procedures; and
(2) any exemptions prescribed by the Secretary under
paragraph (5) or (6) of such section 5318(a) and the manner in
which interfaces and templates which might be developed could
be programmed to reflect any such exemption for a financial
institution, transaction, or class of transactions.
(c) Prototype and Report Required.--
(1) In general.--Before the end of the 1-year period
beginning on the date of the enactment of this Act, the
Secretary shall submit a report to the Congress containing a
detailed description of the findings and conclusions of the
Secretary in connection with the study required under
subsection (a), together with such recommendations for
legislative or administrative action as the Secretary may
determine to be appropriate.
(2) Prototype.--Any recommendation on the feasibility of
developing and implementing interfaces and templates for use in
electronic communications shall be accompanied by prototypes of
such interfaces and templates that demonstrate such
feasibility.
(d) Definitions.--For purposes of this section, the following
definitions shall apply:
(1) Interface.--The term ``interface'' means the point and
method of interaction between any 2 or more electronic data
storage and communication systems that permits and facilitates
active electronic communication between or among the systems,
including any procedures, codes, and protocols that enable the
systems to interact.
(2) Template.--The term ``template'' means a preestablished
layout model using word processing or other authoring software
that ensures that data entered into it will adhere to a
consistent format and content scheme when used by all parties
engaged in electronic communications among each other.

SEC. 706. ANNUAL REPORT BY SECRETARY OF THE TREASURY.

(a) Findings.--The Congress finds as follows:
(1) Financial institutions have too little information
about money laundering and terrorist financing compliance in
other markets.
(2) The current Financial Action Task Force designation
system does not adequately represent the progress countries are
making in combatting money laundering.
(3) Lack of information about the compliance of countries
with anti-money laundering standards exposes United States
financial markets to excessive risk.
(4) Failure to designate countries that fail to make
progress in combatting terrorist financing and money laundering
eliminates incentives for internal reform.
(5) The Secretary of the Treasury has an affirmative duty
to provide to financial institutions and examiners the best
possible information on compliance with anti-money laundering
and terrorist financing initiatives in other markets.
(b) Report.--Not later than March 1 of each year, the Secretary of
the Treasury shall submit to the Congress a report that identifies the
applicable standards of each country against money laundering and
states whether that country is a country of primary money laundering
concern under section 5318A of title 31, United States Code. The report
shall include--
(1) information on the effectiveness of each country in
meeting its standards against money laundering;
(2) a determination of whether that the efforts of that
country to combat money laundering and terrorist financing are
adequate, improving, or inadequate; and
(3) the efforts made by the Secretary to provide to the
government of each such country of concern technical assistance
to cease the activities that were the basis for the
determination that the country was of primary money laundering
concern.
(c) Dissemination of Information in Report.--The Secretary of the
Treasury shall make available to the Federal Financial Institutions
Examination Council for incorporation into the examination process, in
consultation with Federal banking agencies, and to financial
institutions the information contained in the report submitted under
subsection (a). Such information shall be made available to financial
institutions without cost.
(d) Definition.--For purposes of this section, the term ``financial
institution'' has the meaning given that term in section 5312(a)(2) of
title 31, United States Code.

SEC. 707. PRESERVATION OF MONEY SERVICES BUSINESSES.

(a) Findings.--The Congress finds as follows:
(1) Title III of the USA PATRIOT ACT provided United States
law enforcement agencies with new tools to combat terrorist
financing and money laundering.
(2) The Financial Crimes Enforcement Network in the
Department of the Treasury (hereafter in this section referred
to as ``FinCEN'' ) has defined money services businesses to
include the following 5 distinct types of financial services
providers as well as the United States Postal Service:
(A) Currency dealers or exchanges.
(B) Check cashing services.
(C) Issuers of travelers' checks, money orders, or
stored value cards.
(D) Sellers or redeemers of travelers' checks,
money orders, or stored value cards.
(E) Money transmitters.
(3) Money services businesses have had more difficulty in
obtaining and maintaining banking services since the passage of
the USA PATRIOT ACT.
(4) On March 30, 2005, FinCEN and the Federal banking
agencies (as defined in section 3 of the Federal Deposit
Insurance Act) issued a joint statement recognizing the
importance of ensuring that money services businesses that
comply with the law have reasonable access to banking services.
(5) On April 26, 2005, FinCEN offered guidance to money
service businesses on obtaining and maintaining banking
services by identifying and explaining to money services
businesses the types of information and documentation they are
expected to have, and to provide to, depository institutions
when conducting banking business.
(6) At the same time, FinCEN and the Federal banking
agencies have issued joint guidance to depository institutions
to--
(A) clarify the requirements of subchapter II of
chapter 53 of title 31, United States Code, and related
provisions of law; and
(B) set forth the minimum steps that depository
institutions should take when providing banking
services to money services businesses.
(7) It is in the interest of the United States and its
allies in the wars against terrorism and drugs to make certain
that the international transfer of funds is done in a rules-
based, formal, and transparent manner and that individuals are
not forced into utilizing informal underground methods due to a
lack of services.
(b) Sense of the Congress.--It is the sense of the Congress that
depository institutions and money services businesses should follow the
guidance offered by FinCEN for the purpose of giving money services
businesses full access to banking services and ensuring that money
services businesses remain in the mainstream financial system and can
be full players in providing important financial services to their
customers and be fully cooperative in the fight against terrorist
financing and money laundering.

TITLE VIII--CLERICAL AND TECHNICAL AMENDMENTS

SEC. 801. CLERICAL AMENDMENTS TO THE HOME OWNERS' LOAN ACT.

(a) Amendment to Table of Contents.--The table of contents in
section 1 of the Home Owners' Loan Act (12 U.S.C. 1461) is amended by
striking the items relating to sections 5 and 6 and inserting the
following new items:

``Sec. 5. Savings associations.
``Sec. 6. [Repealed.].''.
(b) Clerical Amendments to Headings.--
(1) The heading for section 4(a) of the Home Owners' Loan
Act (12 U.S.C. 1463(a)) is amended by striking ``(a) Federal
Savings Associations.--'' and inserting ``(a) General
Responsibilities of the Director.--''.
(2) The section heading for section 5 of the Home Owners'
Loan Act (12 U.S.C. 1464) is amended to read as follows:

``SEC. 5. SAVINGS ASSOCIATIONS.''.

SEC. 802. TECHNICAL CORRECTIONS TO THE FEDERAL CREDIT UNION ACT.

The Federal Credit Union Act (12 U.S.C. 1751 et seq.) is amended as
follows:
(1) In section 101(3), strike ``and'' after the semicolon.
(2) In section 101(5), strike the terms ``account account''
and ``account accounts'' each place any such term appears and
insert ``account''.
(3) In section 107(a)(5)(E) (as so designated by section
303 of this Act), strike the period at the end and insert a
semicolon.
(4) In paragraphs (6) and (7) of section 107(a) (as so
designated by section 303 of this Act), strike the period at
the end and insert a semicolon.
(5) In section 107(a)(7)(D) (as so designated by section
303 of this Act), strike ``the Federal Savings and Loan
Insurance Corporation or''.
(6) In section 107(a)(7)(E) (as so designated by section
303 of this Act), strike ``the Federal Home Loan Bank Board,''
and insert ``the Federal Housing Finance Board,''.
(7) In section 107(a)(9) (as so designated by section 303
of this Act), strike ``subchapter III'' and insert ``title
III''.
(8) In section 107(a)(13) (as so designated by section 303
of this Act), strike the ``and'' after the semicolon at the
end.
(9) In section 109(c)(2)(A)(i), strike ``(12 U.S.C.
4703(16))''.
(10) In section 120(h), strike ``the Act approved July 30,
1947 (6 U.S.C., secs. 6-13),'' and insert ``chapter 93 of title
31, United States Code,''.
(11) In section 201(b)(5), strike ``section 116 of''.
(12) In section 202(h)(3), strike ``section 207(c)(1)'' and
insert ``section 207(k)(1)''.
(13) In section 204(b), strike ``such others powers'' and
insert ``such other powers''.
(14) In section 206(e)(3)(D), strike ``and'' after the
semicolon at the end.
(15) In section 206(f)(1), strike ``subsection (e)(3)(B)''
and insert ``subsection (e)(3)''.
(16) In section 206(g)(7)(D), strike ``and subsection
(1)''.
(17) In section 206(t)(2)(B), insert ``regulations'' after
``as defined in''.
(18) In section 206(t)(2)(C), strike ``material affect''
and insert ``material effect''.
(19) In section 206(t)(4)(A)(ii)(II), strike ``or'' after
the semicolon at the end.
(20) In section 206A(a)(2)(A), strike ``regulator agency''
and insert ``regulatory agency''.
(21) In section 207(c)(5)(B)(i)(I), insert ``and'' after
the semicolon at the end.
(22) In the heading for subparagraph (A) of section
207(d)(3), strike ``to'' and insert ``with''.
(23) In section 207(f)(3)(A), strike ``category or
claimants'' and insert ``category of claimants''.
(24) In section 209(a)(8), strike the period at the end and
insert a semicolon.
(25) In section 216(n), insert ``any action'' before ``that
is required''.
(26) In section 304(b)(3), strike ``the affairs or such
credit union'' and insert ``the affairs of such credit union''.
(27) In section 310, strike ``section 102(e)'' and insert
``section 102(d)''.

SEC. 803. OTHER TECHNICAL CORRECTIONS.

(a) Section 1306 of title 18, United States Code, is amended by
striking ``5136A'' and inserting ``5136B''.
(b) Section 5239 of the Revised Statutes of the United States (12
U.S.C. 93) is amended by redesignating the second of the 2 subsections
designated as subsection (d) (as added by section 331(b)(3) of the
Riegle Community Development and Regulatory Improvement Act of 1994) as
subsection (e).

SEC. 804. REPEAL OF OBSOLETE PROVISIONS OF THE BANK HOLDING COMPANY ACT
OF 1956.

(a) In General.--Section 2 of the Bank Holding Company Act of 1956
(12 U.S.C. 1841) is amended--
(1) in subsection (c)(2), by striking subparagraphs (I) and
(J); and
(2) by striking subsection (m) and inserting the following
new subsection:
``(m) [Repealed]''.
(b) Technical and Conforming Amendments.--Paragraphs (1) and (2) of
section 4(h) of the Bank Holding Company Act of 1956 (12 U.S.C.
1843(h)) are each amended by striking ``(G), (H), (I), or (J) of
section 2(c)(2)'' and inserting ``(G), or (H) of section 2(c)(2)''.

TITLE IX--FAIR DEBT COLLECTION PRACTICES ACT AMENDMENTS

SEC. 901. EXCEPTION FOR CERTAIN BAD CHECK ENFORCEMENT PROGRAMS.

(a) In General.--The Fair Debt Collection Practices Act (15 U.S.C.
1692 et seq.) is amended--
(1) by redesignating section 818 as section 819; and
(2) by inserting after section 817 the following new
section:
``Sec. 818. Exception for certain bad check enforcement programs
operated by private entities
``(a) In General.--If--
``(1) a State or district attorney establishes, within the
jurisdiction of such State or district attorney and with
respect to alleged bad check violations that do not involve a
check described in subsection (c), a pretrial diversion program
for alleged bad check offenders who agree to participate
voluntarily in such program to avoid criminal prosecution and
are not described in subsection (b);
``(2) a private entity, that is subject to an
administrative support services contract with a State or
district attorney and operates under the direction, supervision
and control of such State or district attorney, operates the
pretrial diversion program described in paragraph (1); and
``(3) in the course of performing duties delegated to it by
a State or district attorney under the contract, the private
entity referred to in paragraph (2)--
``(A) complies with the penal laws of the State;
``(B) conforms with the terms of the contract and
directives of the State or district attorney;
``(C) does not exercise independent prosecutorial
discretion;
``(D) contacts any alleged offender referred to in
paragraph (1) for purposes of participating in a
program referred to in such paragraph only--
``(i) as a result of any determination by
the State or district attorney that sufficient
evidence of a bad check violation under State
law exists and that contact with the alleged
offender for purposes of participation in the
program is appropriate; or
``(ii) as otherwise permitted in response
to evidence of a bad check;
``(E) includes as part of an initial written
communication with an alleged offender a clear and
conspicuous statement that--
``(i) the alleged offender may dispute the
validity of any alleged bad check violation
through a procedure established and supervised
by the State or district attorney, together
with an explanation of how such a dispute may
be initiated; and
``(ii) where the alleged offender knows, or
has reasonable cause to believe, that the
alleged bad check violation is the result of
theft or forgery of the check, identity theft,
or other fraud that is not the result of the
alleged offender's conduct, the alleged
offender may file a crime report with the
appropriate law enforcement agency and have
further contacts or restitution efforts
suspended until the question of the theft or
forgery of the check, identity theft, or other
fraud has been resolved, together with clear
instructions on how to file such crime report;
and
``(F) charges only fees in connection with services
under the contract that--
``(i) have been authorized by the contract
with the State or district attorney; and
``(ii) conform with the schedule of
reasonable charges for such services which
shall be established by the National District
Attorney's Association, after consultation with
the Commission and representatives of
interested business and consumer organizations,
the private entity shall be treated as an officer of the State and
excluded from the definition of debt collector, pursuant to the
exception provided in section 803(6)(C), with respect to the entity's
operation of the program described in paragraph (1) under the contract
described in paragraph (2).
``(b) Certain Offenders Excluded.--An alleged bad check offender is
described in this subsection if a private entity described in
subsection (a)(2) can determine from available records that such
offender--
``(1) was convicted of a bad check offense in the 3 years
prior to issuing the bad check under consideration; or
``(2) participated in a pretrial diversion program in the
18 months prior to issuing the bad check under consideration.
``(c) Certain Checks Excluded.--A check is described in this
subsection if the check involves, or is subsequently found to involve--
``(1) a postdated check presented in connection with a
payday loan, or other similar transaction, where the holder of
the check knew that the issuer had insufficient funds at the
time the check was made, drawn or delivered;
``(2) a stop payment order where the issuer acted in good
faith and with reasonable cause in stopping payment on the
check;
``(3) a check dishonored because of an adjustment to the
issuer's account by the financial institution holding such
account without providing notice to the person at the time the
check was made, drawn or delivered;
``(4) a check for partial payment of a debt where the
holder had previously accepted partial payment for such debt;
``(5) a check issued by a person who was not competent, or
was not of legal age, to enter into a legal contractual
obligation at the time the check was made, drawn or delivered;
or
``(6) a check issued to pay an obligation arising from a
transaction that was illegal in the jurisdiction of the State
or district attorney at the time the check was made, drawn or
delivered.
``(d) Definitions.--For purposes of this section, the following
definitions shall apply:
``(1) State or district attorney.--The term `State or
district attorney' means the chief elected or appointed
prosecuting attorney in a district, county (as defined in
section 2 of title 1, United States Code), municipality, or
comparable jurisdiction, including State attorneys general who
act as chief elected or appointed prosecuting attorneys in a
district, county (as so defined), municipality or comparable
jurisdiction, who may be referred to by a variety of titles
such as district attorneys, prosecuting attorneys,
commonwealth's attorneys, solicitors, county attorneys, and
state's attorneys, and who are responsible for the prosecution
of State crimes and violations of jurisdiction-specific local
ordinances.
``(2) Check.--The term `check' has the same meaning as in
section 3(6) of the Check Clearing for the 21st Century Act.
``(3) Bad check.--The term `bad check' means any check
that--
``(A) the issuer knew, or should have known, would
not be paid upon presentment because the issuer--
``(i) had no account with the drawee
financial institution at the time the check was
made, drawn, or delivered;
``(ii) had closed the account upon with the
check was made or drawn prior to the time the
check was made, drawn, or delivered; or
``(iii) used a false or altered check, or
false or altered check account number; or
``(B) was refused payment by the financial
institution or other drawee for lack of sufficient
funds and the issuer failed to pay the full amount of
the check, together with reasonable costs as permitted
by State law--
``(i) after receiving written notice from
the holder of the check that payment was
refused by the drawee financial institution to
the extent that the timing and mode of delivery
of such written notice is in compliance with
the applicable State law for determining
criminal liability for bad check offenses; or
``(ii) in a case in which there are no
applicable State law requirements as described
in clause (i), within 30 days of receiving
written notice, mailed to the issuer by
certified mail to the address printed on the
check, or given at the time the check was made,
drawn or delivered or, otherwise, at the
address where the alleged offender resides or
is found, from the holder of the check that
payment of 1 or more checks was refused by the
drawee financial institution.''.
(b) Clerical Amendment.--The table of sections for the Fair Debt
Collection Practices Act is amended--
(1) by redesignating the item relating to section 818 as
section 819; and
(2) by inserting after the item relating to section 817 the
following new item:

``818. Exception for certain bad check enforcement programs operated by
private entities.''.

SEC. 902. OTHER AMENDMENTS.

(a) Legal Pleadings.--Section 809 of the Fair Debt Collection
Practices Act (15 U.S.C. 1692g) is amended by adding at the end the
following new subsection:
``(d) Legal Pleadings.--A communication in the form of a formal
pleading in a civil action shall not be treated as an initial
communication for purposes of subsection (a).''.
(b) Notice Provisions.--Section 809 of the Fair Debt Collection
Practices Act (15 U.S.C. 1692g) is amended by adding after subsection
(d) (as added by subsection (a) of this section) the following new
subsection:
``(e) Notice Provisions.--The sending or delivery of any form or
notice which does not request the payment of a debt and is expressly
required by any other Federal or State law or regulation, including the
Internal Revenue Code of 1986, title V of Gramm-Leach-Bliley Act, and
any data security breach notice and privacy law shall not be treated as
a communication in connection with debt collection. ''.
(c) Establishment of Right to Collect Within the First 30 Days.--
Section 809(b) of the Fair Debt Collection Practices Act (15 U.S.C.
1692g(b)) is amended by striking ``If the consumer'' and inserting
``Collection activities and communications may continue during any 30-
day period referred to in subsection (a). However, if the consumer''.

Passed the House of Representatives March 8, 2006.

Attest:

KAREN L. HAAS,

Clerk.