[105th Congress Public Law 219]
[From the U.S. Government Printing Office]
<DOC>
[DOCID: f:publ219.105]
[[Page 112 STAT. 913]]
Public Law 105-219
105th Congress
An Act
To amend the Federal Credit Union Act to clarify existing law with
regard to the field of membership of Federal credit unions, to preserve
the integrity and purpose of Federal credit unions, to enhance
supervisory oversight of insured credit unions, and for other
purposes. <<NOTE: Aug. 7, 1998 - [H.R. 1151]>>
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled, <<NOTE: Credit Union
Membership Access Act.>>
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) <<NOTE: 12 USC 1751 note.>> Short Title.--This Act may be cited
as the ``Credit Union Membership Access Act''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Findings.
Sec. 3. Definitions.
TITLE I--CREDIT UNION MEMBERSHIP
Sec. 101. Fields of membership.
Sec. 102. Criteria for approval of expansion of membership of multiple
common-bond credit unions.
Sec. 103. Geographical guidelines for community credit unions.
TITLE II--REGULATION OF CREDIT UNIONS
Sec. 201. Financial statement and audit requirements.
Sec. 202. Conversion of insured credit unions.
Sec. 203. Limitation on member business loans.
Sec. 204. National Credit Union Administration Board membership.
Sec. 205. Report and congressional review requirement for certain
regulations.
TITLE III--CAPITALIZATION AND NET WORTH OF CREDIT UNIONS
Sec. 301. Prompt corrective action.
Sec. 302. National credit union share insurance fund equity ratio,
available assets ratio, and standby premium charge.
Sec. 303. Access to liquidity.
TITLE IV--MISCELLANEOUS PROVISIONS
Sec. 401. Study and report on differing regulatory treatment.
Sec. 402. Update on review of regulations and paperwork reductions.
Sec. 403. Treasury report on reduced taxation and viability of small
banks.
SEC. 2. FINDINGS. <<NOTE: 12 USC 1751 note.>>
The Congress finds the following:
(1) The American credit union movement began as a
cooperative effort to serve the productive and provident credit
needs of individuals of modest means.
(2) Credit unions continue to fulfill this public purpose,
and current members and membership groups should not face
divestiture from the financial services institution of their
choice as a result of recent court action.
[[Page 112 STAT. 914]]
(3) To promote thrift and credit extension, a meaningful
affinity and bond among members, manifested by a commonality of
routine interaction, shared and related work experiences,
interests, or activities, or the maintenance of an otherwise
well-understood sense of cohesion or identity is essential to
the fulfillment of the public mission of credit unions.
(4) Credit unions, unlike many other participants in the
financial services market, are exempt from Federal and most
State taxes because they are member-owned, democratically
operated, not-for-profit organizations generally managed by
volunteer boards of directors and because they have the
specified mission of meeting the credit and savings needs of
consumers, especially persons of modest means.
(5) Improved credit union safety and soundness provisions
will enhance the public benefit that citizens receive from these
cooperative financial services institutions.
SEC. 3. DEFINITIONS. <<NOTE: 12 USC 1790d note.>>
As used in this Act--
(1) the term ``Administration'' means the National Credit
Union Administration;
(2) the term ``Board'' means the National Credit Union
Administration Board;
(3) the term ``Federal banking agencies'' has the same
meaning as in section 3 of the Federal Deposit Insurance Act;
(4) the terms ``insured credit union'' and ``State-chartered
insured credit union'' have the same meanings as in section 101
of the Federal Credit Union Act; and
(5) the term ``Secretary'' means the Secretary of the
Treasury.
TITLE I--CREDIT UNION MEMBERSHIP
SEC. 101. FIELDS OF MEMBERSHIP.
Section 109 of the Federal Credit Union Act (12 U.S.C. 1759) is
amended--
(1) in the first sentence--
(A) by striking ``Federal credit union membership
shall consist of '' and inserting ``(a) In General.--
Subject to subsection (b), Federal credit union
membership shall consist of ''; and
(B) by striking ``, except that'' and all that
follows through ``rural district''; and
(2) by adding at the end the following new subsections:
``(b) Membership Field.--Subject to the other provisions of this
section, the membership of any Federal credit union shall be limited to
the membership described in one of the following
categories:
``(1) Single common-bond credit union.--One group that has a
common bond of occupation or association.
``(2) Multiple common-bond credit union.--More than one
group--
``(A) each of which has (within the group) a common
bond of occupation or association; and
[[Page 112 STAT. 915]]
``(B) the number of members, each of which (at the
time the group is first included within the field of
membership of a credit union described in this
paragraph) does not exceed any numerical limitation
applicable under subsection (d).
``(3) Community credit union.--Persons or organizations
within a well-defined local community, neighborhood, or rural
district.
``(c) Exceptions.--
``(1) Grandfathered members and groups.--
``(A) In general.--Notwithstanding subsection (b)--
``(i) any person or organization that is a
member of any Federal credit union as of the date
of enactment of the Credit Union Membership Access
Act may remain a member of the credit union after
that date of enactment; and
``(ii) a member of any group whose members
constituted a portion of the membership of any
Federal credit union as of that date of enactment
shall continue to be eligible to become a member
of that credit union, by virtue of membership in
that group, after that date of enactment.
``(B) Successors.--If the common bond of any group
referred to in subparagraph (A) is defined by any
particular organization or business entity, subparagraph
(A) shall continue to apply with respect to any
successor to the organization or entity.
``(2) Exception for underserved areas.--Notwithstanding
subsection (b), in the case of a Federal credit union, the field
of membership category of which is described in subsection
(b)(2), the Board may allow the membership of the credit union
to include any person or organization within a local community,
neighborhood, or rural district if--
``(A) the Board determines that the local community,
neighborhood, or rural district--
``(i) is an `investment area', as defined in
section 103(16) of the Community Development
Banking and Financial Institutions Act of 1994 (12
U.S.C. 4703(16)), and meets such additional
requirements as the Board may impose; and
``(ii) is underserved, based on data of the
Board and the Federal banking agencies (as defined
in section 3 of the Federal Deposit Insurance
Act), by other depository institutions (as defined
in section 19(b)(1)(A) of the Federal Reserve
Act); and
``(B) the credit union establishes and maintains an
office or facility in the local community, neighborhood,
or rural district at which credit union services are
available.
``(d) Multiple Common-Bond Credit Union Group
Requirements.--
``(1) Numerical limitation.--Except as provided in paragraph
(2), only a group with fewer than 3,000 members shall be
eligible to be included in the field of membership category of a
credit union described in subsection (b)(2).
[[Page 112 STAT. 916]]
``(2) Exceptions.--In the case of any Federal credit union,
the field of membership category of which is described in
subsection (b)(2), the numerical limitation in paragraph (1) of
this subsection shall not apply with respect to--
``(A) any group that the Board determines, in
writing and in accordance with the guidelines and
regulations issued under paragraph (3), could not
feasibly or reasonably establish a new single common-
bond credit union, the field of membership category of
which is described in subsection (b)(1) because--
``(i) the group lacks sufficient volunteer and
other resources to support the efficient and
effective operation of a credit union;
``(ii) the group does not meet the criteria
that the Board has determined to be important for
the likelihood of success in establishing and
managing a new credit union, including demographic
characteristics such as geographical location of
members, diversity of ages and income levels, and
other factors that may affect the financial
viability and stability of a credit union; or
``(iii) the group would be unlikely to operate
a safe and sound credit union;
``(B) any group transferred from another credit
union--
``(i) in connection with a merger or
consolidation recommended by the Board or any
appropriate State credit union supervisor based on
safety and soundness concerns with respect to that
other credit union; or
``(ii) by the Board in the Board's capacity as
conservator or liquidating agent with respect to
that other credit union; or
``(C) any group transferred in connection with a
voluntary merger, having received conditional approval
by the Administration of the merger application prior to
October 25, 1996, but not having consummated the merger
prior to October 25, 1996, if the merger is consummated
not later than 180 days after the date of enactment of
the Credit Union Membership Access Act.
``(3) Regulations and guidelines.--The Board shall issue
guidelines or regulations, after notice and opportunity for
comment, setting forth the criteria that the Board will apply in
determining under this subsection whether or not an additional
group may be included within the field of membership category of
an existing credit union described in subsection (b)(2).
``(e) Additional Membership Eligibility Provisions.--
``(1) Membership eligibility limited to immediate family or
household members.--No individual shall be eligible for
membership in a credit union on the basis of the relationship of
the individual to another person who is eligible for membership
in the credit union, unless the individual is a member of the
immediate family or household (as those terms are defined by the
Board, by regulation) of the other person.
``(2) Retention of membership.--Except as provided in
section 118, once a person becomes a member of a credit union in
accordance with this title, that person or organization may
remain a member of that credit union until the person or
[[Page 112 STAT. 917]]
organization chooses to withdraw from the membership of the
credit union.''.
SEC. 102. CRITERIA FOR APPROVAL OF EXPANSION OF MEMBERSHIP OF MULTIPLE
COMMON-BOND CREDIT UNIONS.
Section 109 of the Federal Credit Union Act (12 U.S.C. 1759) is
amended by adding at the end the following new subsection:
``(f ) Criteria for Approval of Expansion of Multiple
Common-Bond Credit Unions.--
``(1) In general.--The Board shall--
``(A) encourage the formation of separately
chartered credit unions instead of approving an
application to include an additional group within the
field of membership of an existing credit union whenever
practicable and consistent with reasonable standards for
the safe and sound operation of the credit union; and
``(B) if the formation of a separate credit union by
the group is not practicable or consistent with the
standards referred to in subparagraph (A), require the
inclusion of the group in the field of membership of a
credit union that is within reasonable proximity to the
location of the group whenever practicable and
consistent with reasonable standards for the safe and
sound operation of the credit union.
``(2) Approval criteria.--The Board may not approve any
application by a Federal credit union, the field of membership
category of which is described in subsection (b)(2) to include
any additional group within the field of membership of the
credit union (or an application by a Federal credit union
described in subsection (b)(1) to include an additional group
and become a credit union described in subsection (b)(2)),
unless the Board determines, in writing, that--
``(A) the credit union has not engaged in any unsafe
or unsound practice (as defined in section 206(b)) that
is material during the 1-year period preceding the date
of filing of the application;
``(B) the credit union is adequately capitalized;
``(C) the credit union has the administrative
capability to serve the proposed membership group and
the financial resources to meet the need for additional
staff and assets to serve the new membership group;
``(D) any potential harm that the expansion of the
field of membership of the credit union may have on any
other insured credit union and its members is clearly
outweighed in the public interest by the probable
beneficial effect of the expansion in meeting the
convenience and needs of the members of the group
proposed to be included in the field of membership; and
``(E) the credit union has met such additional
requirements as the Board may prescribe, by
regulation.''.
SEC. 103. GEOGRAPHICAL GUIDELINES FOR COMMUNITY CREDIT UNIONS.
Section 109 of the Federal Credit Union Act (12 U.S.C. 1759) is
amended by adding at the end the following new subsection:
``(g) Regulations Required for Community Credit Unions.--
[[Page 112 STAT. 918]]
``(1) Definition of well-defined local community,
neighborhood, or rural district.--The Board shall prescribe, by
regulation, a definition for the term `well-defined local
community, neighborhood, or rural district' for purposes of--
``(A) making any determination with regard to the
field of membership of a credit union described in
subsection (b)(3); and
``(B) establishing the criteria applicable with
respect to any such determination.
``(2) Scope of application.--The definition prescribed by
the Board under paragraph (1) shall apply with respect to any
application to form a new credit union, or to alter or expand
the field of membership of an existing credit union, that is
filed with the Board after the date of enactment of the Credit
Union Membership Access Act.''.
TITLE II--REGULATION OF CREDIT UNIONS
SEC. 201. FINANCIAL STATEMENT AND AUDIT REQUIREMENTS.
(a) In General.--Section 202(a)(6) of the Federal Credit Union Act
(12 U.S.C. 1782(a)(6)) is amended by adding at the end the following new
subparagraphs:
``(C) Accounting principles.--
``(i) In general.--Accounting principles
applicable to reports or statements required to be
filed with the Board by each insured credit union
shall be uniform and consistent with generally
accepted accounting principles.
``(ii) Board determination.--If the Board
determines that the application of any generally
accepted accounting principle to any insured
credit union is not appropriate, the Board may
prescribe an accounting principle for application
to the credit union that is no less stringent than
generally accepted accounting principles.
``(iii) De minimus exception.--This
subparagraph shall not apply to any insured credit
union, the total assets of which are less than
$10,000,000, unless prescribed by the Board or an
appropriate State credit union supervisor.
``(D) Large credit union audit requirement.--
``(i) In general.--Each insured credit union
having total assets of $500,000,000 or more shall
have an annual independent audit of the financial
statements of the credit union, performed in
accordance with generally accepted auditing
standards by an independent certified public
accountant or public accountant licensed by the
appropriate State or jurisdiction to perform those
services.
``(ii) Voluntary audits.--If a Federal credit
union that is not required to conduct an audit
under clause (i), and that has total assets of
more than $10,000,000 conducts such an audit for
any purpose, using an independent auditor who is
compensated for his or
[[Page 112 STAT. 919]]
her audit services with respect to that audit, the
audit shall be performed consistent with the
accountancy laws of the appropriate State or
jurisdiction, including licensing requirements.''.
(b) Technical and Conforming Amendment.--Section 202(a)(6)(B) of the
Federal Credit Union Act (12 U.S.C. 1782(a)(6)(B)) is amended by
striking ``subparagraph (A)'' and inserting ``subparagraph (A) or (D)''.
SEC. 202. CONVERSION OF INSURED CREDIT UNIONS.
Section 205(b) of the Federal Credit Union Act (12 U.S.C. 1785(b))
is amended--
(1) in paragraph (1), by striking ``Except with the prior
written approval of the Board, no insured credit union shall''
and inserting ``Except as provided in paragraph (2), no insured
credit union shall, without the prior approval of the Board'';
(2) by redesignating paragraph (2) as paragraph (3); and
(3) by inserting after paragraph (1) the following new
paragraph:
``(2) Conversion of insured credit unions to mutual savings
banks.--
``(A) In general.--Notwithstanding paragraph (1), an
insured credit union may convert to a mutual savings
bank or savings association (if the savings association
is in mutual form), as those terms are defined in
section 3 of the Federal Deposit Insurance Act, without
the prior approval of the Board, subject to the
requirements and procedures set forth in the laws and
regulations governing mutual savings banks and savings
associations.
``(B) Conversion proposal.--A proposal for a
conversion described in subparagraph (A) shall first be
approved, and a date set for a vote thereon by the
members (either at a meeting to be held on that date or
by written ballot to be filed on or before that date),
by a majority of the directors of the insured credit
union. Approval of the proposal for conversion shall be
by the affirmative vote of a majority of the members of
the insured credit union who vote on the proposal.
``(C) Notice of proposal to members.--An insured
credit union that proposes to convert to a mutual
savings bank or savings association under subparagraph
(A) shall submit notice to each of its members who is
eligible to vote on the matter of its intent to
convert--
``(i) 90 days before the date of the member
vote on the conversion;
``(ii) 60 days before the date of the member
vote on the conversion; and
``(iii) 30 days before the date of the member
vote on the conversion.
``(D) Notice of proposal to board.--The Board may
require an insured credit union that proposes to convert
to a mutual savings bank or savings association under
subparagraph (A) to submit a notice to the Board of its
intent to convert during the 90-day period preceding the
date of the completion of the conversion.
``(E) Inapplicability of act upon conversion.--Upon
completion of a conversion described in subparagraph
(A),
[[Page 112 STAT. 920]]
the credit union shall no longer be subject to any of
the provisions of this Act.
``(F) Limit on compensation of officials.--
``(i) In general.--No director or senior
management official of an insured credit union may
receive any economic benefit in connection with a
conversion of the credit union as described in
subparagraph (A), other than--
``(I) director fees; and
``(II) compensation and other
benefits paid to directors or senior
management officials of the
converted institution in the ordinary
course of business.
``(ii) Senior management official.--For
purposes of this subparagraph, the term `senior
management official' means a chief executive
officer, an assistant chief executive officer, a
chief financial officer, and any other senior
executive officer (as defined by the appropriate
Federal banking agency pursuant to section 32 (f )
of the Federal Deposit Insurance Act).
``(G) Consistent rules.--
``(i) <<NOTE: Deadline.>> In general.--Not
later than 6 months after the date of enactment of
the Credit Union Membership Access Act, the
Administration shall promulgate final rules
applicable to charter conversions described in
this paragraph that are consistent with rules
promulgated by other financial regulators,
including the Office of Thrift Supervision and the
Office of the Comptroller of the Currency. The
rules required by this clause shall provide that
charter conversion by an insured credit union
shall be subject to regulation that is no more or
less restrictive than that applicable to charter
conversions by other financial institutions.
``(ii) Oversight of member vote.--The member
vote concerning charter conversion under this
paragraph shall be administered by the
Administration, and shall be verified by the
Federal or State regulatory agency that would have
jurisdiction over the institution after the
conversion. If either the Administration or that
regulatory agency disapproves of the methods by
which the member vote was taken or procedures
applicable to the member vote, the member vote
shall be taken again, as directed by the
Administration or the agency.''.
SEC. 203. LIMITATION ON MEMBER BUSINESS LOANS.
(a) In General.--The Federal Credit Union Act (12 U.S.C. 1701 et
seq.) is amended by inserting after section 107 the following new
section:
``SEC. 107A. LIMITATION ON MEMBER BUSINESS LOANS. <<NOTE: 12 USC
1757a.>>
``(a) In General.--On and after the date of enactment of this
section, no insured credit union may make any member business loan that
would result in a total amount of such loans outstanding at that credit
union at any one time equal to more than the lesser of--
``(1) 1.75 times the actual net worth of the credit union;
or
[[Page 112 STAT. 921]]
``(2) 1.75 times the minimum net worth required under
section 216(c)(1)(A) for a credit union to be well capitalized.
``(b) Exceptions.--Subsection (a) does not apply in the
case of--
``(1) an insured credit union chartered for the purpose of
making, or that has a history of primarily making, member
business loans to its members, as determined by the Board; or
``(2) an insured credit union that--
``(A) serves predominantly low-income members, as
defined by the Board; or
``(B) is a community development financial
institution, as defined in section 103 of the Community
Development Banking and Financial Institutions Act of
1994.
``(c) Definitions.--As used in this section--
``(1) the term `member business loan'--
``(A) means any loan, line of credit, or letter of
credit, the proceeds of which will be used for a
commercial, corporate or other business investment
property or venture, or agricultural purpose; and
``(B) does not include an extension of credit--
``(i) that is fully secured by a lien on a 1-
to 4-family dwelling that is the primary residence
of a member;
``(ii) that is fully secured by shares in the
credit union making the extension of credit or
deposits in other financial institutions;
``(iii) that is described in subparagraph (A),
if it was made to a borrower or an associated
member that has a total of all such extensions of
credit in an amount equal to less than $50,000;
``(iv) the repayment of which is fully insured
or fully guaranteed by, or where there is an
advance commitment to purchase in full by, any
agency of the Federal Government or of a State, or
any political subdivision thereof; or
``(v) that is granted by a corporate credit
union (as that term is defined by the Board) to
another credit union.
``(2) the term `net worth'--
``(A) with respect to any insured credit union,
means the credit union's retained earnings balance, as
determined under generally accepted accounting
principles; and
``(B) with respect to a credit union that serves
predominantly low-income members, as defined by the
Board, includes secondary capital accounts that are--
``(i) uninsured; and
``(ii) subordinate to all other claims against
the credit union, including the claims of
creditors, shareholders, and the Fund; and
``(3) the term `associated member' means any member
having a shared ownership, investment, or other pecuniary
interest in a business or commercial endeavor with the borrower.
``(d) <<NOTE: Deadline.>> Effect on Existing Loans.--An insured
credit union that has, on the date of enactment of this section, a total
amount of outstanding member business loans that exceeds the amount
[[Page 112 STAT. 922]]
permitted under subsection (a) shall, not later than 3 years after that
date of enactment, reduce the total amount of outstanding member
business loans to an amount that is not greater than the amount
permitted under subsection (a).
``(e) Consultation and Cooperation With State Credit Union
Supervisors.--In implementing this section, the Board shall consult and
seek to work cooperatively with State officials having jurisdiction over
State-chartered insured credit unions.''.
(b) Study and Report.-- <<NOTE: 12 USC 1757a note.>>
(1) Study.--The Secretary shall conduct a study of member
business lending by insured credit unions, including--
(A) an examination of member business lending over
$500,000 and under $50,000, and a breakdown of the types
and sizes of businesses that receive member business
loans;
(B) a review of the effectiveness and enforcement of
regulations applicable to insured credit union member
business lending;
(C) whether member business lending by insured
credit unions could affect the safety and soundness of
insured credit unions or the National Credit Union Share
Insurance Fund;
(D) the extent to which member business lending by
insured credit unions helps to meet financial services
needs of low- and moderate-income individuals within the
field of membership of insured credit unions;
(E) whether insured credit unions that engage in
member business lending have a competitive advantage
over other insured depository institutions, and if any
such advantage could affect the viability and
profitability of such other insured depository
institutions; and
(F) the effect of enactment of this Act on the
number of insured credit unions involved in member
business lending and the overall amount of commercial
lending.
(2) NCUA cooperation.--The National Credit Union
Administration shall, upon request, provide such information as
the Secretary may require to conduct the study required under
paragraph (1).
(3) <<NOTE: Deadline.>> Report.--Not later than 12 months
after the date of enactment of this Act, the Secretary shall
submit a report to the Congress on the results of the study
conducted under paragraph (1).
SEC. 204. NATIONAL CREDIT UNION ADMINISTRATION BOARD
MEMBERSHIP.
Section 102(b) of the Federal Credit Union Act (12 U.S.C. 1752a(b))
is amended--
(1) by striking ``(b) The Board'' and inserting ``(b)
Membership and Appointment of Board.--
``(1) In general.--The Board''; and
(2) by adding at the end the following new paragraph:
``(2) Appointment criteria.--
``(A) <<NOTE: President.>> Experience in financial
services.--In considering appointments to the Board
under paragraph (1), the President shall give
consideration to individuals who, by virtue of their
education, training, or experience relating to a broad
range of financial services, financial services
[[Page 112 STAT. 923]]
regulation, or financial policy, are especially
qualified to serve on the Board.
``(B) Limit on appointment of credit union
officers.--Not more than one member of the Board may be
appointed to the Board from among individuals who, at
the time of the appointment, are, or have recently been,
involved with any insured credit union as a committee
member, director, officer, employee, or other
institution-affiliated party.''.
SEC. 205. <<NOTE: 12 USC 1759 note.>> REPORT AND CONGRESSIONAL REVIEW
REQUIREMENT FOR CERTAIN REGULATIONS.
A regulation prescribed by the Board shall be treated as a major
rule for purposes of chapter 8 of title 5, United States Code, if the
regulation defines, or amends the definition of--
(1) the term ``immediate family or household'' for purposes
of section 109(e)(1) of the Federal Credit Union Act (as added
by section 101 of this Act); or
(2) the term ``well-defined local community, neighborhood,
or rural district'' for purposes of section 109(g) of the
Federal Credit Union Act (as added by section 103 of this Act).
TITLE III--CAPITALIZATION AND NET WORTH OF CREDIT UNIONS
SEC. 301. PROMPT CORRECTIVE ACTION.
(a) In General.--Title II of the Federal Credit Union Act (12 U.S.C.
1781 et seq.) is amended by adding at the end the following new section:
``SEC. 216. PROMPT CORRECTIVE ACTION. <<NOTE: 12 USC 1790d.>>
``(a) Resolving Problems To Protect Fund.--
``(1) Purpose.--The purpose of this section is to resolve
the problems of insured credit unions at the least possible
long-term loss to the Fund.
``(2) Prompt corrective action required.--The Board shall
carry out the purpose of this section by taking prompt
corrective action to resolve the problems of insured credit
unions.
``(b) Regulations Required.--
``(1) Insured credit unions.--
``(A) In general.--The Board shall, by regulation,
prescribe a system of prompt corrective action for
insured credit unions that is--
``(i) consistent with this section; and
``(ii) comparable to section 38 of the Federal
Deposit Insurance Act.
``(B) Cooperative character of credit unions.--The
Board shall design the system required under
subparagraph (A) to take into account that credit unions
are not-for-profit cooperatives that--
``(i) do not issue capital stock;
``(ii) must rely on retained earnings to build
net worth; and
``(iii) have boards of directors that consist
primarily of volunteers.
[[Page 112 STAT. 924]]
``(2) New credit unions.--
``(A) In general.--In addition to regulations under
paragraph (1), the Board shall, by regulation, prescribe
a system of prompt corrective action that shall apply to
new credit unions in lieu of this section and the
regulations prescribed under paragraph (1).
``(B) Criteria for alternative system.--The Board
shall design the system prescribed under subparagraph
(A)--
``(i) to carry out the purpose of this
section;
``(ii) to recognize that credit unions (as
cooperatives that do not issue capital stock)
initially have no net worth, and give new credit
unions reasonable time to accumulate net worth;
``(iii) to create adequate incentives for new
credit unions to become adequately capitalized by
the time that they either--
``(I) have been in operation for
more than 10 years; or
``(II) have more than $10,000,000 in
total assets;
``(iv) to impose appropriate restrictions and
requirements on new credit unions that do not make
sufficient progress toward becoming adequately
capitalized; and
``(v) to prevent evasion of the purpose of
this
section.
``(c) Net Worth Categories.--
``(1) In general.--For purposes of this section the
following definitions shall apply:
``(A) Well capitalized.--An insured credit union is
`well capitalized' if--
``(i) it has a net worth ratio of not less
than 7 percent; and
``(ii) it meets any applicable risk-based net
worth requirement under subsection (d).
``(B) Adequately capitalized.--An insured credit
union is `adequately capitalized' if--
``(i) it has a net worth ratio of not less
than 6 percent; and
``(ii) it meets any applicable risk-based net
worth requirement under subsection (d).
``(C) Undercapitalized.--An insured credit union is
`undercapitalized' if--
``(i) it has a net worth ratio of less than 6
percent; or
``(ii) it fails to meet any applicable risk-
based net worth requirement under subsection (d).
``(D) Significantly undercapitalized.--An insured
credit union is `significantly undercapitalized'--
``(i) if it has a net worth ratio of less than
4 percent; or
``(ii) if--
``(I) it has a net worth ratio of
less than 5 percent; and
``(II) it--
[[Page 112 STAT. 925]]
``(aa) fails to submit an
acceptable net worth restoration
plan within the time allowed
under subsection (f ); or
``(bb) materially fails to
implement a net worth
restoration plan accepted by the
Board.
``(E) Critically undercapitalized.--An insured
credit union is `critically undercapitalized' if it has
a net worth ratio of less than 2 percent (or such higher
net worth ratio, not to exceed 3 percent, as the Board
may specify by regulation).
``(2) Adjusting net worth levels.--
``(A) In general.--If, for purposes of section 38(c)
of the Federal Deposit Insurance Act, the Federal
banking agencies increase or decrease the required
minimum level for the leverage limit (as those terms are
used in section 38), the Board may, by regulation, and
subject to subparagraph (B) of this paragraph,
correspondingly increase or decrease 1 or more of the
net worth ratios specified in subparagraphs (A) through
(D) of paragraph (1) of this subsection in an amount
that is equal to not more than the difference between
the required minimum level most recently established by
the Federal banking agencies and 4 percent of total
assets (with respect to institutions regulated by those
agencies).
``(B) Determinations required.--The Board may
increase or decrease net worth ratios under subparagraph
(A) only if the Board--
``(i) determines, in consultation with the
Federal banking agencies, that the reason for the
increase or decrease in the required minimum level
for the leverage limit also justifies the
adjustment in net worth ratios; and
``(ii) determines that the resulting net worth
ratios are sufficient to carry out the purpose of
this section.
``(C) Transition period required.--If the Board
increases any net worth ratio under this paragraph, the
Board shall give insured credit unions a reasonable
period of time to meet the increased ratio.
``(d) Risk-Based Net Worth Requirement for Complex Credit Unions.--
``(1) In general.--The regulations required under subsection
(b)(1) shall include a risk-based net worth requirement for
insured credit unions that are complex, as defined by the Board
based on the portfolios of assets and liabilities of credit
unions.
``(2) Standard.--The Board shall design the risk-based net
worth requirement to take account of any material risks against
which the net worth ratio required for an insured credit union
to be adequately capitalized may not provide adequate
protection.
``(e) Earnings-Retention Requirement Applicable to Credit Unions
That Are Not Well Capitalized.--
``(1) In general.--An insured credit union that is not well
capitalized shall annually set aside as net worth an amount
equal to not less than 0.4 percent of its total assets.
``(2) Board's authority to decrease earnings-retention
requirement.--
[[Page 112 STAT. 926]]
``(A) In general.--The Board may, by order, decrease
the 0.4 percent requirement in paragraph (1) with
respect to a credit union to the extent that the Board
determines that the decrease--
``(i) is necessary to avoid a significant
redemption of shares; and
``(ii) would further the purpose of this
section.
``(B) Periodic review required.--The Board shall
periodically review any order issued under subparagraph
(A).
``(f ) Net Worth Restoration Plan Required.--
``(1) In general.--Each insured credit union that is
undercapitalized shall submit an acceptable net worth
restoration plan to the Board within the time allowed under this
subsection.
``(2) Assistance to small credit unions.--The Board (or the
staff of the Board) shall, upon timely request by an insured
credit union with total assets of less than $10,000,000, and
subject to such regulations or guidelines as the Board may
prescribe, assist that credit union in preparing a net worth
restoration plan.
``(3) <<NOTE: Regulations.>> Deadlines for submission and
review of plans.--The Board shall, by regulation, establish
deadlines for submission of net worth restoration plans under
this subsection that--
``(A) provide insured credit unions with reasonable
time to submit net worth restoration plans; and
``(B) require the Board to act on net worth
restoration plans expeditiously.
``(4) Failure to submit acceptable plan within time
allowed.--
``(A) <<NOTE: Notification.>> Failure to submit any
plan.--If an insured credit union fails to submit a net
worth restoration plan within the time allowed under
paragraph (3), the Board shall--
``(i) promptly notify the credit union of that
failure; and
``(ii) give the credit union a reasonable
opportunity to submit a net worth restoration
plan.
``(B) Submission of unacceptable plan.--If an
insured credit union submits a net worth restoration
plan within the time allowed under paragraph (3), and
the Board determines that the plan is not acceptable,
the Board shall--
``(i) promptly notify the credit union of why
the plan is not acceptable; and
``(ii) give the credit union a reasonable
opportunity to submit a revised plan.
``(5) Accepting plan.--The Board may accept a net worth
restoration plan only if the Board determines that the plan is
based on realistic assumptions and is likely to succeed in
restoring the net worth of the credit union.
``(g) Restrictions on Undercapitalized Credit Unions.--
``(1) Restriction on asset growth.--An insured credit union
that is undercapitalized shall not generally permit its average
total assets to increase, unless--
``(A) the Board has accepted the net worth
restoration plan of the credit union for that action;
[[Page 112 STAT. 927]]
``(B) any increase in total assets is consistent
with the net worth restoration plan; and
``(C) the net worth ratio of the credit union
increases at a rate that is consistent with the net
worth restoration plan.
``(2) Restriction on member business loans.--Notwithstanding
section 107A(a), an insured credit union that is
undercapitalized may not make any increase in the total amount
of member business loans (as defined in section 107A(c))
outstanding at that credit union at any one time, until such
time as the credit union becomes adequately capitalized.
``(h) More Stringent Treatment Based on Other Supervisory
Criteria.--With respect to the exercise of authority by the Board under
regulations comparable to section 38(g) of the Federal Deposit Insurance
Act--
``(1) the Board may not reclassify an insured credit union
into a lower net worth category, or treat an insured credit
union as if it were in a lower net worth category, for reasons
not pertaining to the safety and soundness of that credit union;
and
``(2) the Board may not delegate its authority to reclassify
an insured credit union into a lower net worth category or to
treat an insured credit union as if it were in a lower net worth
category.
``(i) Action Required Regarding Critically Under-
capitalized Credit Unions.--
``(1) <<NOTE: Deadline.>> In general.--The Board shall, not
later than 90 days after the date on which an insured credit
union becomes
critically undercapitalized--
``(A) appoint a conservator or liquidating agent for
the credit union; or
``(B) take such other action as the Board determines
would better achieve the purpose of this section, after
documenting why the action would better achieve that
purpose.
``(2) <<NOTE: Termination date.>> Periodic redeterminations
required.--Any determination by the Board under paragraph (1)(B)
to take any action with respect to an insured credit union in
lieu of appointing a conservator or liquidating agent shall
cease to be effective not later than the end of the 180-day
period beginning on the date on which the determination is made,
and a conservator or liquidating agent shall be appointed for
that credit union under paragraph (1)(A), unless the Board makes
a new determination under paragraph (1)(B) before the end of the
effective period of the prior determination.
``(3) Appointment of liquidating agent required if other
action fails to restore net worth.--
``(A) In general.--Notwithstanding paragraphs (1)
and (2), the Board shall appoint a liquidating agent for
an insured credit union if the credit union is
critically undercapitalized on average during the
calendar quarter beginning 18 months after the date on
which the credit union became critically
undercapitalized.
``(B) Exception.--Notwithstanding subparagraph (A),
the Board may continue to take such other action as the
Board determines to be appropriate in lieu of
appointment of a liquidating agent if--
``(i) the Board determines that--
[[Page 112 STAT. 928]]
``(I) the insured credit union has
been in substantial compliance with an
approved net worth restoration plan that
requires consistent improvement in the
net worth of the credit union since the
date of the approval of the plan; and
``(II) the insured credit union has
positive net income or has an upward
trend in earnings that the Board
projects as sustainable; and
``(ii) the Board certifies that the credit
union is viable and not expected to fail.
``(4) Nondelegation.--
``(A) In general.--Except as provided in
subparagraph (B), the Board may not delegate the
authority of the Board under this subsection.
``(B) Exception.--The Board may delegate the
authority of the Board under this subsection with
respect to an insured credit union that has less than
$5,000,000 in total assets, if the Board permits the
credit union to appeal any adverse action to the Board.
``( j) Review Required When Fund Incurs Material Loss.--For purposes
of determining whether the Fund has incurred a material loss with
respect to an insured credit union (such that the inspector general of
the Board must make a report), a loss is material if it exceeds the sum
of--
``(1) $10,000,000; and
``(2) an amount equal to 10 percent of the total assets of
the credit union at the time at which the Board initiated
assistance under section 208 or was appointed liquidating agent.
``(k) <<NOTE: Regulations.>> Appeals Process.--Material supervisory
determinations, including decisions to require prompt corrective action,
made pursuant to this section by Administration officials other than the
Board may be appealed to the Board pursuant to the independent appellate
process required by section 309 of the Riegle Community Development and
Regulatory Improvement Act of 1994 (or, if the Board so specifies,
pursuant to separate procedures prescribed by regulation).
``(l) Consultation and Cooperation With State Credit Union
Supervisors.--
``(1) In general.--In implementing this section, the Board
shall consult and seek to work cooperatively with State
officials having jurisdiction over State-chartered insured
credit unions.
``(2) Evaluating net worth restoration plan.--In evaluating
any net worth restoration plan submitted by a State-chartered
insured credit union, the Board shall seek the views of the
State official having jurisdiction over the credit union.
``(3) Deciding whether to appoint conservator or
liquidating agent.--With respect to any decision by the Board on
whether to appoint a conservator or liquidating agent for a
State-chartered insured credit union--
``(A) the Board shall--
``(i) seek the views of the State official
having jurisdiction over the credit union; and
``(ii) give that official an opportunity to
take the proposed action;
[[Page 112 STAT. 929]]
``(B) the Board shall, upon timely request of an
official referred to in subparagraph (A), promptly
provide the official with--
``(i) a written statement of the reasons for
the proposed action; and
``(ii) reasonable time to respond to that
statement;
``(C) if the official referred to in subparagraph
(A) makes a timely written response that disagrees with
the proposed action and gives reasons for that
disagreement, the Board shall not appoint a conservator
or liquidating agent for the credit union, unless the
Board, after considering the views of the official, has
determined that--
``(i) the Fund faces a significant risk of
loss with respect to the credit union if a
conservator or liquidating agent is not appointed;
and
``(ii) the appointment is necessary to
reduce--
``(I) the risk that the Fund would
incur a loss with respect to the credit
union; or
(II) any loss that the Fund is
expected to incur with respect to the
credit union; and
``(D) the Board may not delegate any determination
under subparagraph (C).
``(m) Corporate Credit Unions Exempted.--This section does not apply
to any insured credit union that--
``(1) operates primarily for the purpose of serving credit
unions; and
``(2) permits individuals to be members of the credit union
only to the extent that applicable law requires that such
persons own shares.
``(n) Other Authority Not Affected.--This section does not limit any
authority of the Board or a State to take action in addition to (but not
in derogation of ) that is required under this section.
``(o) Definitions.--For purposes of this section the following
definitions shall apply:
``(1) Federal banking agency.--The term `Federal
banking agency ' has the same meaning as in section 3 of the
Federal Deposit Insurance Act.
``(2) Net worth.--The term `net worth'--
``(A) with respect to any insured credit union,
means retained earnings balance of the credit union, as
determined under generally accepted accounting
principles; and
``(B) with respect to a low-income credit union,
includes secondary capital accounts that are--
``(i) uninsured; and
``(ii) subordinate to all other claims against
the credit union, including the claims of
creditors, shareholders, and the Fund.
``(3) Net worth ratio.--The term `net worth ratio' means,
with respect to a credit union, the ratio of the net worth of
the credit union to the total assets of the credit union.
``(4) New credit union.--The term `new credit union' means
an insured credit union that--
``(A) has been in operation for less than 10 years;
and
``(B) has not more than $10,000,000 in total
assets.''.
[[Page 112 STAT. 930]]
(b) Conservatorship and Liquidation Amendments To Facilitate Prompt
Corrective Action.--
(1) Conservatorship.--Section 206(h) of the Federal Credit
Union Act (12 U.S.C. 1786(h)) is amended--
(A) in paragraph (1)--
(i) in subparagraph (D), by striking ``or'' at
the end;
(ii) in subparagraph (E), by striking the
period at the end and inserting a semicolon; and
(iii) by adding at the end the following new
subparagraphs:
``(F) the credit union is significantly undercapitalized, as
defined in section 216, and has no reasonable prospect of
becoming adequately capitalized, as defined in section 216; or
``(G) the credit union is critically undercapitalized, as
defined in section 216.''; and
(B) in paragraph (2)--
(i) in subparagraph (A), by striking ``In the
case'' and inserting ``Except as provided in
subparagraph (C), in the case''; and
(ii) by adding at the end the following new
subparagraph:
``(C) In the case of a State-chartered insured credit union,
the authority conferred by subparagraphs (F) and (G) of
paragraph (1) may not be exercised unless the Board has complied
with section 216(l).''.
(2) Liquidation.--Section 207(a) of the Federal Credit Union
Act (12 U.S.C. 1787(a)) is amended--
(A) in paragraph (1)(A), by striking ``himself ''
and inserting ``itself ''; and
(B) by adding at the end the following new
paragraph:
``(3) Liquidation to facilitate prompt corrective action.--
The Board may close any credit union for liquidation, and
appoint itself or another (including, in the case of a State-
chartered insured credit union, the State official having
jurisdiction over the credit union) as liquidating agent of that
credit union, if--
``(A) the Board determines that--
``(i) the credit union is significantly
undercapitalized, as defined in section 216, and
has no reasonable prospect of becoming adequately
capitalized, as defined in section 216; or
``(ii) the credit union is critically
undercapitalized, as defined in section 216; and
``(B) in the case of a State-chartered insured
credit union, the Board has complied with section
216(l).''.
(c) <<NOTE: 12 USC 1790d note.>> Consultation Required.--In
developing regulations to implement section 216 of the Federal Credit
Union Act (as added by subsection (a) of this section), the Board shall
consult with the Secretary, the Federal banking agencies, and the State
officials having jurisdiction over State-chartered insured credit
unions.
(d) Deadlines for Regulations.-- <<NOTE: 12 USC 1790d note.>>
(1) In general.--Except as provided in paragraph (2), the
Board shall--
(A) <<NOTE: Federal Register, publication.>>
publish in the Federal Register proposed regulations to
implement section 216 of the Federal Credit Union Act
(as added by subsection (a) of this section) not later
[[Page 112 STAT. 931]]
than 270 days after the date of enactment of this Act;
and
(B) promulgate final regulations to implement
section 216 not later than 18 months after the date of
enactment of this Act.
(2) Risk-based net worth requirement.--
(A) <<NOTE: Federal Register, publication.>>
Advance notice of proposed rulemaking.--Not later than
180 days after the date of enactment of this Act, the
Board shall publish in the Federal Register an advance
notice of proposed rulemaking, as required by section
216(d) of the Federal Credit Union Act, as added by this
Act.
(B) Final regulations.--The Board shall promulgate
final regulations, as required by section 216(d) not
later than 2 years after the date of enactment of this
Act.
(e) Effective Date.-- <<NOTE: 12 USC 1790d note.>>
(1) In general.--Except as provided in paragraph (2),
section 216 of the Federal Credit Union Act (as added by this
section) shall become effective 2 years after the date of
enactment of this Act.
(2) Risk-based net worth requirement.--Section 216(d) of the
Federal Credit Union Act (as added by this section) shall become
effective on January 1, 2001.
(f ) <<NOTE: 12 USC 1790d note.>> Report to Congress Required.--
When the Board publishes proposed regulations pursuant to subsection
(d)(1)(A), or promulgates final regulations pursuant to subsection
(d)(1)(B), the Board shall submit to the Congress a report that
specifically explains--
(1) how the regulations carry out section 216(b)(1)(B) of
the Federal Credit Union Act (as added by this section),
relating to the cooperative character of credit unions; and
(2) how the regulations differ from section 38 of the
Federal Deposit Insurance Act, and the reasons for those
differences.
(g) Conforming Amendments.--
(1) Amendments relating to enforcement of prompt corrective
action.--Section 206(k) of the Federal Credit Union Act (12
U.S.C. 1786(k)) is amended--
(A) in paragraph (1), by inserting ``or section
216'' after ``this section'' each place it appears; and
(B) in paragraph (2)(A)(ii), by inserting ``, or any
final order under section 216'' before the semicolon.
(2) Conforming amendment regarding appointment of state
credit union supervisor as conservator.--Section 206(h)(1) of
the Federal Credit Union Act (12 U.S.C. 1786(h)(1)) is amended
by inserting ``or another (including, in the case of a State-
chartered insured credit union, the State official having
jurisdiction over the credit union)'' after ``appoint itself ''.
(3) Amendment repealing superseded provision.--
Section 116 of the Federal Credit Union Act (12 U.S.C. 1762) is
repealed.
SEC. 302. NATIONAL CREDIT UNION SHARE INSURANCE FUND EQUITY RATIO,
AVAILABLE ASSETS RATIO, AND STANDBY
PREMIUM CHARGE.
(a) In General.--Section 202 of the Federal Credit Union Act (12
U.S.C. 1782) is amended--
(1) by striking subsection (b) and inserting the following:
[[Page 112 STAT. 932]]
``(b) Certified Statement.--
``(1) Statement required.--
``(A) In general.--For each calendar year, in the
case of an insured credit union with total assets of not
more than $50,000,000, and for each semi-annual period
in the case of an insured credit union with total assets
of $50,000,000 or more, an insured credit union shall
file with the Board, at such time as the Board
prescribes, a certified statement showing the total
amount of insured shares in the credit union at the
close of the relevant period and both the amount of its
deposit or adjustment of deposit and the amount of the
insurance charge due to the Fund for that period, both
as computed under subsection (c).
``(B) Exception for newly insured credit union.--
Subparagraph (A) shall not apply with respect to a
credit union that became insured during the reporting
period.
``(2) Form.--The certified statements required to be filed
with the Board pursuant to this subsection shall be in such form
and shall set forth such supporting information as the Board
shall require.
``(3) Certification.--The president of the credit union or
any officer designated by the board of directors shall certify,
with respect to each statement required to be filed with the
Board pursuant to this subsection, that to the best of his or
her knowledge and belief the statement is true, correct,
complete, and in accordance with this title and the regulations
issued under this title.'';
(2) in subsection (c)(1)(A), by striking clause (iii) and
inserting the following:
``(iii) Periodic adjustment.--The amount of
each insured credit union's deposit shall be
adjusted as follows, in accordance with procedures
determined by the Board, to reflect changes in the
credit union's insured shares:
``(I) annually, in the case of an
insured credit union with total assets
of not more than $50,000,000; and
``(II) semi-annually, in the case of
an insured credit union with total
assets of $50,000,000 or more.'';
(3) in subsection (c), by striking paragraphs (2) and (3)
and inserting the following:
``(2) Insurance premium charges.--
``(A) In general.--Each insured credit union shall,
at such times as the Board prescribes (but not more than
twice in any calendar year), pay to the Fund a premium
charge for insurance in an amount stated as a percentage
of insured shares (which shall be the same for all
insured credit unions).
``(B) Relation of premium charge to equity ratio of
fund.--The Board may assess a premium charge only if--
``(i) the Fund's equity ratio is less than 1.3
percent; and
[[Page 112 STAT. 933]]
``(ii) the premium charge does not exceed the
amount necessary to restore the equity ratio to
1.3 percent.
``(C) Premium charge required if equity ratio falls
below 1.2 percent.--If the Fund's equity ratio is less
than 1.2 percent, the Board shall, subject to
subparagraph (B), assess a premium charge in such an
amount as the Board determines to be necessary to
restore the equity ratio to, and maintain that ratio at,
1.2 percent.
``(3) Distributions from fund required.--
``(A) In general.--The Board shall effect a pro rata
distribution to insured credit unions after each
calendar year if, as of the end of that calendar year--
``(i) any loans to the Fund from the Federal
Government, and any interest on those loans, have
been repaid;
``(ii) the Fund's equity ratio exceeds the
normal operating level; and
``(iii) the Fund's available assets ratio
exceeds 1.0 percent.
``(B) Amount of distribution.--The Board shall
distribute under subparagraph (A) the maximum possible
amount that--
``(i) does not reduce the Fund's equity ratio
below the normal operating level; and
``(ii) does not reduce the Fund's available
assets ratio below 1.0 percent.
``(C) Calculation based on certified statements.--In
calculating the Fund's equity ratio and available assets
ratio for purposes of this paragraph, the Board shall
determine the aggregate amount of the insured shares in
all insured credit unions from insured credit unions
certified statements under subsection (b) for the final
reporting period of the calendar year referred to in
subparagraph (A).'';
(4) in subsection (c), by adding at the end the following
new paragraph:
``(4) Timeliness and accuracy of data.--In calculating the
available assets ratio and equity ratio of the Fund, the Board
shall use the most current and accurate data reasonably
available.''; and
(5) by striking subsection (h) and inserting the following:
``(h) Definitions.--For purposes of this section, the following
definitions shall apply:
``(1) Available assets ratio.--The term `available assets
ratio', when applied to the Fund, means the ratio of--
``(A) the amount determined by subtracting--
``(i) direct liabilities of the Fund and
contingent liabilities for which no provision for
losses has been made, from
``(ii) the sum of cash and the market value of
unencumbered investments authorized under section
203(c), to
``(B) the aggregate amount of the insured shares in
all insured credit unions.
``(2) Equity ratio.--The term `equity ratio', when applied
to the Fund, means the ratio of--
[[Page 112 STAT. 934]]
``(A) the amount of Fund capitalization, including
insured credit unions' 1 percent capitalization deposits
and the retained earnings balance of the Fund (net of
direct liabilities of the Fund and contingent
liabilities for which no provision for losses has been
made); to
``(B) the aggregate amount of the insured shares in
all insured credit unions.
``(3) Insured shares.--The term `insured shares', when
applied to this section, includes share, share draft, share
certificate, and other similar accounts as determined by the
Board, but does not include amounts exceeding the insured
account limit set forth in section 207(c)(1).
``(4) Normal operating level.--The term `normal
operating level', when applied to the Fund, means an equity
ratio specified by the Board, which shall be not less than 1.2
percent and not more than 1.5 percent.''.
(b) <<NOTE: 12 USC 1782 note.>> Effective Date.--This section and
the amendments made by this section shall become effective on January 1
of the first calendar year beginning more than 180 days after the date
of enactment of this Act.
SEC. 303. ACCESS TO LIQUIDITY.
Section 204 of the Federal Credit Union Act (12 U.S.C. 1784) is
amended by adding at the end the following new subsections:
``(f ) Access to Liquidity.--The Board shall--
``(1) periodically assess the potential liquidity needs of
each insured credit union, and the options that the credit union
has available for meeting those needs; and
``(2) periodically assess the potential liquidity needs of
insured credit unions as a group, and the options that insured
credit unions have available for meeting those needs.
``(g) Sharing Information With Federal Reserve Banks.--The Board
shall, for the purpose of facilitating insured credit unions' access to
liquidity, make available to the Federal reserve banks (subject to
appropriate assurances of confidentiality) information relevant to
making advances to such credit unions, including the Board's reports of
examination.''.
TITLE IV--MISCELLANEOUS PROVISIONS
SEC. 401. <<NOTE: 12 USC 1752a note.>> STUDY AND REPORT ON DIFFERING
REGULATORY
TREATMENT.
(a) Study.--The Secretary shall conduct a study of--
(1) the differences between credit unions and other
federally insured financial institutions, including regulatory
differences with respect to regulations enforced by the Office
of Thrift Supervision, the Office of the Comptroller of the
Currency, the Federal Deposit Insurance Corporation, and the
Administration; and
(2) the potential effects of the application of Federal
laws, including Federal tax laws, on credit unions in the same
manner as those laws are applied to other federally insured
financial institutions.
[[Page 112 STAT. 935]]
(b) <<NOTE: Deadline.>> Report.--Not later than 1 year after the
date of enactment of this Act, the Secretary shall submit a report to
the Congress on the results of the study required by subsection (a).
SEC. 402. <<NOTE: Deadline. Reports. 12 USC 4803 note.>> UPDATE ON
REVIEW OF REGULATIONS AND PAPERWORK REDUCTIONS.
Not later than 1 year after the date of enactment of this Act, the
Federal banking agencies shall submit a report to the Congress detailing
their progress in carrying out section 303(a) of the Riegle Community
Development and Regulatory Improvement Act of 1994, since their
submission of the report dated September 23, 1996, as required by
section 303(a)(4) of that Act.
SEC. 403. <<NOTE: Deadline. 12 USC 4801 note.>> TREASURY REPORT ON
REDUCED TAXATION AND VIABILITY OF SMALL BANKS.
The Secretary shall, not later than 1 year after the date of
enactment of this Act, submit a report to the Congress containing--
(1) recommendations for such legislative and administrative
action as the Secretary deems appropriate, that would reduce and
simplify the tax burden for--
(A) insured depository institutions having less than
$1,000,000,000 in assets; and
(B) banks having total assets of not less than
$1,000,000,000 nor more than $10,000,000,000; and
(2) any other recommendations that the Secretary deems
appropriate that would preserve the viability and growth of
small banking institutions in the United States.
Approved August 7, 1998.
LEGISLATIVE HISTORY--H.R. 1151:
---------------------------------------------------------------------------
HOUSE REPORTS: No. 105-472 (Comm. on Banking and Financial Services).
SENATE REPORTS: No. 105-193 (Comm. on Banking, Housing, and Urban
Affairs).
CONGRESSIONAL RECORD, Vol. 144 (1998):
Apr. 1, considered and passed House.
July 24, 27, 28, considered and passed Senate, amended.
Aug. 4, House concurred in Senate amendment.
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 34 (1998):
Aug. 7, Presidential statement.
<all>