[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1700 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 1700

     To amend the Community Reinvestment Act and the Home Mortgage 
   Disclosure Act of 1975 to improve the availability of credit on a 
                        nondiscriminatory basis.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             April 5, 1993

  Ms. Waters (for herself, Mr. Rangel, Mr. Clay, Ms. Norton, and Mrs. 
    Meek) introduced the following bill; which was referred to the 
            Committee on Banking, Finance and Urban Affairs

                            January 24, 1994

   Additional sponsors: Ms. Eddie Bernice Johnson of Texas, and Mr. 
                               Jefferson

_______________________________________________________________________

                                 A BILL


 
     To amend the Community Reinvestment Act and the Home Mortgage 
   Disclosure Act of 1975 to improve the availability of credit on a 
                        nondiscriminatory basis.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Community Reinvestment Act Reform 
Act of 1993''.

          TITLE I--COMMUNITY CREDIT AVAILABILITY IMPROVEMENTS

SEC. 101. REPORTING OF ACTUAL PERFORMANCE DATA.

    (a) In General.--The Community Reinvestment Act of 1977 (12 U.S.C. 
2901 et seq.) is amended by adding at the end the following new 
section:

``SEC. 809. REPORTING OF ACTUAL PERFORMANCE DATA.

    ``(a) Establishment Required.--The appropriate Federal financial 
supervisory agencies shall jointly develop a format for collecting data 
from regulated financial institutions, in connection with examinations 
under section 804 concerning such institutions' record of meeting the 
credit needs of their local communities, including low- and moderate-
income neighborhoods.
    ``(b) Data Required.--The data required to be collected under 
subsection (a) shall include the following:
            ``(1) Home mortgage lending.--
                    ``(A) The aggregate number and dollar volume of 
                single family conventional loans, government insured or 
                guaranteed loans, loans for multi-family housing, and 
                home improvement loans originated by the institution 
                and the aggregate number of such loans initiated in 
                neighborhoods of different racial and income 
                compositions.
                    ``(B) The rate at which the institution rejects 
                applications of various racial and income groups and a 
                comparison of such rate with the rate of other 
                institutions in the financial institution's entire 
                community.
                    ``(C) The percentage of applications the financial 
                institution receives from minority and low- and 
                moderate-income persons in the institution's entire 
                community, expressed as a percentage of the 
                institution's overall applications, and a comparison of 
                such percentage with the percentage of other 
                institutions in the financial institution's entire 
                community.
                    ``(D) An analysis of the financial institution's 
                overall market share in the institution's entire 
                community for each loan type and the institution's 
                market share in neighborhoods of various income and 
                racial compositions.
                    ``(E) The nature and extent of the institution's 
                participation in affordable housing programs that 
                benefit the institution's entire community.
            ``(2) Small business lending.--
                    ``(A) The aggregate number and dollar volume of 
                loans originated, with a separate breakout for 
                originations to minority-owned and women-owned 
                businesses and start-up businesses.
                    ``(B) The aggregate number and dollar volume of 
                loans originated under programs administered by the 
                Small Business Administration, with a separate break-
                out for minority-owned and women-owned businesses.
                    ``(C) The aggregate number and dollar volume of 
                small business loans originated by the financial 
                institution, compiled on the basis of the racial and 
                income characteristics in the institution's entire 
                community.
            ``(3) Community development.--
                    ``(A) The number and dollar volume of loans to 
                nonprofit child care, mental health, and literacy 
                centers and to nonprofit developers of affordable 
                housing.
                    ``(B) The financial institution's participation in 
                any community development project, including a 
                description of any partnerships developed with 
                nonprofit community organizations, that benefit the 
                low- and moderate-income residents of the institution's 
                entire community.
            ``(4) Consumer loans.--A statistical analysis of the number 
        and dollar volume of consumer loans compiled on the basis of 
        the racial and income characteristics of neighborhoods in the 
        institution's entire community.
            ``(5) Branch closures.--
                    ``(A) A compilation of the number of the 
                institution's branches and other deposit facilities in 
                neighborhoods of various racial and income 
                characteristics within the institution's community.
                    ``(B) An analysis of all openings and closings of 
                branches and other deposit facilities by the 
                institution in the past 10 years in neighborhoods of 
                various racial and income characteristics within the 
                institution's community.''.
    (b) Data Required in Public Section of Report.--Section 807(b)(1) 
of the Community Reinvestment Act of 1977 (12 U.S.C. 2906(b)(1)) is 
amended--
            (1) by striking ``and'' at the end of subparagraph (B);
            (2) by striking the period at the end of subparagraph (C) 
        and inserting ``; and''; and
            (3) by adding at the end the following new subparagraph:
                    ``(D) contain the data required to be collected 
                with respect to the institution pursuant to section 
                809.''.

SEC. 102. ENHANCED OPPORTUNITIES FOR COMMUNITY INPUT.

    Section 807 of the Community Reinvestment Act of 1977 (12 U.S.C. 
2906) is amended by adding at the end the following new subsection:
    ``(d) Views of Consumers.--
            ``(1) In general.--The appropriate Federal financial 
        supervisory agency shall actively solicit comments, in writing 
        and in person, for no fewer than 45 days prior to the issuance 
        of a rating under subsection (b).
            ``(2) Special emphasis.--In soliciting comments under 
        paragraph (1), the appropriate Federal financial supervisory 
        agency shall emphasize contacts with low- and moderate-income 
        and minority residents of affected communities within the 
        institution's entire community, community groups representing 
        such residents, small businesses, and nonprofit organizations 
        providing services in low- and moderate-income communities.
            ``(3) Interviews with applicants for credit.--Any examiner 
        conducting an examination under section 804 may interview any 
        applicant for credit to the regulated financial institution in 
        order to determine whether there is evidence of any practice 
        which might tend to discourage an applicant from pursuing an 
        application for credit, including the discouragement of an 
        application on a prohibited basis.
            ``(4) Extension of comment period.--If a substantial number 
        of requests are received by an appropriate Federal financial 
        supervisory agency for public comment under paragraph (1), the 
        agency shall--
                    ``(A) extend the comment period no fewer than 75 
                days; and
                    ``(B) hold a public hearing.''.

SEC. 103. COLLECTION OF DATA ON SMALL BUSINESS AND CONSUMER LOANS.

    Section 304(a)(1) of the Home Mortgage Disclosure Act of 1975 (12 
U.S.C. 2803(a)(1)) is amended by inserting ``, the number and total 
dollar amount of loans to small business, by census tracts, and the 
number and total dollar amount of personal loans to consumers, by 
census tracts'' before the period at the end.

SEC. 104. RATING SYSTEM UNDER CRA.

    (a) 5 Point Rating System.--Section 807(b)(2) of the Community 
Reinvestment Act of 1977 (12 U.S.C. 2906(b)(2)) is amended--
            (1) by redesignating subparagraphs (C) and (D) as 
        subparagraphs (D) and (E), respectively, and by inserting after 
        subparagraph (B) the following new subparagraph:
                    ``(C) `Qualified record of meeting community credit 
                needs which needs to improve'.''; and
            (2) in subparagraph (D) (as so redesignated by paragraph 
        (1) of this subsection), is amended by striking ``Needs'' and 
        inserting ``Substantial and immediate need''.
    (b) Rating Integrity.--Section 807(b) of the Community Reinvestment 
Act of 1977 (12 U.S.C. 2906(b)) is amended by adding at the end the 
following new paragraph:
            ``(3) Rating integrity.--No financial institution may 
        receive a rating described in subparagraph (A) or (B) of 
        paragraph (2) unless such institution has actually extended 
        significant amounts of credit in low-income neighborhoods and 
        has not merely been in compliance with a plan for extending 
        such credit in the future.''.
    (c) Prompt Corrective Action.--The Community Reinvestment Act of 
1977 (12 U.S.C. 2901 et seq.) is amended by adding after section 809 
(as added by section 101 of this Act) the following new section:

``SEC. 810. PROMPT CORRECTIVE ACTION.

    ``(a) Action Required.--
            ``(1) Qualified record of meeting community credit needs 
        which needs to improve.--
                    ``(A) Submission of plan.--Any regulated financial 
                institution which receives a rating of `qualified 
                record of meeting community credit needs which needs to 
                improve' shall submit, to the appropriate Federal 
                financial supervisory agency, a plan for improving the 
                institution's performance with respect to meeting the 
                credit needs of the institution's entire community, 
                including low- and moderate-income neighborhoods, by 
                the end of the 6-month period beginning on the date the 
                institution receives such rating under this Act.
                    ``(B) Reduction of rating for failure to comply.--
                If a regulated financial institution described in 
                subparagraph (A) fails to submit a plan under such 
                subparagraph which is acceptable to the appropriate 
                Federal supervisory agency before the end of the 
                ______-month period beginning on the date the rating 
                referred to in such subparagraph is received by the 
                institution, the institution's rating under section 
                807(a)(2) as of the end of such period shall be deemed 
                to be `substantial and immediate need to improve record 
                of meeting community credit needs' for purposes of this 
                Act, including paragraph (2).
            ``(2) Substantial and immediate need to improve record of 
        meeting community credit needs.--
                    ``(A) Submission of plan.--Any regulated financial 
                institution which receives a rating of `substantial and 
                immediate need to improve record of meeting community 
                credit needs' shall submit, to the appropriate Federal 
                financial supervisory agency before the end of the 30-
                day period beginning on the date the institution 
                receives such rating under this Act, a plan for 
                substantially improving the institution's performance 
                with respect to meeting the credit needs of the 
                institution's entire community, including low- and 
                moderate-income neighborhoods, by the end of the 6-
                month period beginning on such date.
                    ``(B) Public hearing.--
                            ``(i) In general.--The appropriate Federal 
                        financial supervisory agency shall hold a 
                        public hearing on the adequacy of any plan 
                        submitted pursuant to subparagraph (A) before 
                        the end of the 30-day period beginning on the 
                        date the plan is submitted to the agency.
                            ``(ii) Notice of hearing.--The appropriate 
                        Federal financial supervisory agency shall 
                        provide adequate notice in the regulated 
                        financial institution's entire community, 
                        including low- and moderate-income 
                        neighborhoods, of any hearing conducted under 
                        clause (i).
                    ``(C) Reduction of rating for failure to comply.--
                If a regulated financial institution described in 
                subparagraph (A) fails to submit a plan under such 
                subparagraph which is acceptable to the appropriate 
                Federal supervisory agency before the end of the 
                ______-month period beginning on the date the rating 
                referred to in such subparagraph is received by the 
                institution, the institution's rating under section 
                807(a)(2) as of the end of such period shall be deemed 
                to be `substantial noncompliance in meeting community 
                credit needs' for purposes of this Act, including 
                paragraph (3).
            ``(3) Substantial noncompliance in meeting community credit 
        needs.--
                    ``(A) Prompt corrective action required.--If a 
                regulated financial institution receives a rating of 
                `substantial noncompliance in meeting community credit 
                needs', the appropriate Federal supervisory agency 
                shall--
                            ``(i) treat such rating as a violation of 
                        the requirements of this Act; and
                            ``(ii) promptly take such corrective action 
                        as may be necessary to ensure that such 
                        institution meets the credit needs of the 
                        institution's entire community, including low- 
                        and moderate-income neighborhoods, as soon as 
                        practicable.
                    ``(B) Monthly loan activity reports required.--Any 
                regulated financial institution which receives a rating 
                of `substantial noncompliance in meeting community 
                credit needs' shall submit a monthly report to the 
                appropriate Federal supervisory agency on the actions 
                the institution has taken during the period covered by 
                the report to meet the credit needs of the low- and 
                moderate-income neighborhoods in the institution's 
                community.
                    ``(C) Additional supervision.--The appropriate 
                Federal supervisory agency shall provide such 
                additional supervision of an institution described in 
                subparagraph (A) as may be necessary, including 
                conducting special examinations, to ensure that such 
                institution is--
                            ``(i) in compliance with all plans approved 
                        by the agency for substantially improving the 
                        institution's performance with respect to 
                        meeting the credit needs of the institution's 
                        entire community, including low- and moderate-
                        income neighborhoods; and
                            ``(ii) making all possible progress towards 
                        meeting such credit needs.
    ``(b) Administrative Enforcement.--
            ``(1) In general.--Compliance with the requirements imposed 
        under this Act shall be enforced under section 8 of the Federal 
        Deposit Insurance Act by the appropriate Federal financial 
        supervisory agency.
            ``(2) Additional enforcement powers.--
                    ``(A) Violation of this act treated as violation of 
                other act.--For purposes of the exercise by any 
                appropriate Federal financial supervisory agency of the 
                agency's powers under the Federal Deposit Insurance 
                Act, a violation of a requirement imposed under this 
                Act shall be deemed to be a violation of a requirement 
                imposed under that Act.
                    ``(B) Enforcement authority under other acts.--In 
                addition to the powers of any appropriate Federal 
                financial supervisory under the Federal Deposit 
                Insurance Act, each such agency may exercise, for 
                purposes of enforcing compliance with any requirement 
                imposed under this Act, any other authority conferred 
                on such agency by law.''.

                TITLE II--COMMUNITY SUPPORT REQUIREMENTS

SEC. 201. COMMUNITY SUPPORT OBLIGATIONS OF MORTGAGE BANKS.

    (a) In General.--Each mortgage bank shall have an ongoing 
responsibility to meet the credit needs of all the communities in which 
such bank makes a significant number of extensions of credit or extends 
a significant amount of credit, including extensions of credit in low- 
and moderate-income neighborhoods of such communities.
    (b) Definitions.--For purposes of this title--
            (1) Mortgage Bank.--The term ``mortgage bank'' means any 
        lender who does not accept deposits and originates housing 
        related loans.
            (2) Office.--The term ``Office'' means the Office of 
        Mortgage Bank and Insurance Supervision established by the 
        Secretary of Housing and Urban Development pursuant to section 
        202.
            (3) Secretary.--The term ``Secretary'' means the Secretary 
        of Housing and Urban Development.

SEC. 202. ESTABLISHMENT OF OFFICE OF MORTGAGE BANK AND INSURANCE 
              SUPERVISION.

    The Secretary of Housing and Urban Development shall establish 
within the Department of Housing and Urban Development an office to be 
known as the Office of Mortgage Bank and Insurance Supervision to 
evaluate the community support performance of mortgage banks and 
mortgage insurance companies.

SEC. 203. MORTGAGE BANK COMMUNITY SUPPORT STATEMENTS.

    (a) In General.--The Office shall, on a biennial basis, require 
each mortgage bank to submit to the Office a community support 
statement, detailing the efforts of such bank at meeting the housing 
credit needs of each community in which the bank makes a significant 
number of extensions of credit or extends a significant amount of 
credit, including extensions of credit in low- and moderate-income 
neighborhoods of such communities.
    (b) Contents.--The statement submitted by each mortgage bank under 
subsection (a) shall include--
            (1) the data required to be maintained and disclosed by the 
        lender under the Home Mortgage Disclosure Act of 1975 for the 
        previous 2 years, in a format which the Office shall establish;
            (2) underwriting criteria employed by the bank for all of 
        the bank's housing loan products;
            (3) descriptions of any activity the bank has undertaken 
        over the period under review to ascertain and meet identified 
        credit needs in low- and moderate-income neighborhoods within 
        communities in which the bank makes a significant number of 
        extensions of credit or extends a significant amount of credit, 
        including any partnerships formed with community-based 
        organizations, nonprofit developers of affordable housing, or 
        agencies of State or local government;
            (4) details of any findings of technical or substantive 
        violations of the Equal Credit Opportunity Act or the Fair 
        Housing Act, and any settlements or judgments arising from any 
        such findings; and
            (5) any other information the Office may require.

SEC. 204. MORTGAGE BANK COMMUNITY SUPPORT EVALUATION.

    The Office shall determine whether a mortgage bank is maintaining 
an adequate community support performance, based on--
            (1) community support performance statements received from 
        mortgage banks;
            (2) an analysis of the data required to be maintained and 
        disclosed by the lender under the Home Mortgage Disclosure Act 
        of 1975 for the previous 2 years with respect to metropolitan 
        statistical areas in which the bank originates a significant 
        number of home loans, which shall emphasize--
                    (A) the institution's market share in neighborhoods 
                of different racial and income characteristics;
                    (B) the number of applications received from 
                minorities and low- and moderate-income persons; and
                    (C) the rate at which the institutions rejects 
                applications from minority and white applicants;
            (3) any evidence of illegal discriminatory credit 
        practices, including prescreening, or offering less favorable 
        loan products to applicants of different racial backgrounds; 
        and
            (4) public comment, which shall be received by the agency 
        for not less than 90 days after the Office actively solicits 
        comment solicitations of comment through notice in the Federal 
        Register and regular communications with community based 
        organizations.

SEC. 205. PENALTIES FOR FINDING OF INADEQUATE COMMUNITY SUPPORT 
              PERFORMANCE BY MORTGAGE BANKS.

    (a) Remedial Action.--If the Secretary finds that a mortgage bank 
is maintaining an inadequate level of community support, the Secretary 
may issue an order--
            (1) requiring the bank to file a community support action 
        plan with the Office not more than 90 days after the finding, 
        which shall include concrete goals and timetables for 
        correcting identified deficiencies; and
            (2) prohibiting the bank from using any program or product 
        administered by the Secretary until all identified deficiencies 
        are met.
    (b) Cease and Desist Orders.--
            (1) Issuance of order.--
                    (A) In general.--If the Secretary determines that 
                there is reasonable cause to believe that a mortgage 
                bank is violating, has violated, or is about to violate 
                an order under subsection (a) or a community support 
                action plan filed pursuant to such an order, the 
                Secretary may issue an order requiring the mortgage 
                bank to--
                            (i) cease and desist from any such 
                        violation; and
                            (ii) take such affirmative action to 
                        prevent the occurrence or the continuance of 
                        such violation as the Secretary determines to 
                        be appropriate.
                    (B) Notice of charges.--An order issued under this 
                paragraph shall include a notice of the charges on 
                which the order is based and a statement of the facts 
                constituting the alleged violation.
                    (C) Effective period.--An order issued under this 
                paragraph shall--
                            (i) become effective upon service to the 
                        mortgagee; and
                            (ii) remain effective and enforceable 
                        pursuant to the terms of the order unless 
                        modified or rescinded by the Secretary or 
                        pursuant to an order of a court under paragraph 
                        (3) or in connection with the court's review of 
                        any administrative proceedings with respect to 
                        the order issued under this subsection.
            (2) Hearing.--Any mortgage bank which receives an order 
        under paragraph (1) shall be afforded an opportunity for a 
        hearing on the record by the Secretary as soon as practicable 
        but not later than 20 days after the order has been served.
            (3) Judicial hearing.--Within 10 days after a mortgage bank 
        has been served with a cease-and-desist order under this 
        subsection, the bank may apply to the United States district 
        court for the judicial district in which the home office of the 
        bank is located, or the United States District Court for the 
        District of Columbia, for an injunction setting aside, 
        limiting, or suspending the enforcement, operation, or 
        effectiveness of such order pending the completion of the 
        administrative proceedings pursuant to the notice of charges 
        served upon the bank, and such court shall have jurisdiction to 
        issue such injunction.
            (4) Judicial enforcement.--The Secretary may apply to the 
        United States district court, or the United States court of any 
        territory, within the jurisdiction of which the home office of 
        the mortgagee is located, for an injunction to enforce any 
        effective and outstanding order issued under this subsection 
        and, if the court determines that there has been a violation or 
        threatened violation of such order, the court shall issue such 
        injunction.
    (c) Civil Money Penalty.--
            (1) Imposition of penalty.--
                    (A) In general.--The Secretary may impose a civil 
                money penalty on any mortgage bank, and any director, 
                officer or employee of a mortgage bank, who violates 
                any order issued under subsection (a) or (b).
                    (B) Amount of penalty.--The amount of the penalty, 
                as determined by the Secretary, may not exceed--
                            (i) in the case of a violation of an order 
                        issued under subsection (a), $10,000 for each 
                        month during which such violation occurs; and
                            (ii) in the case of a violation of an order 
                        issued under subsection (b), $10,000 for each 
                        day during which such violation continues.
                    (C) Notification to attorney general.--Before 
                taking action to impose a civil money penalty for a 
                violation under subparagraph (A), the Secretary shall 
                inform the Attorney General of the United States.
            (2) Assessment.--
                    (A) Written notice.--Any penalty imposed under 
                paragraph (1) may be assessed and collected by the 
                Secretary by written notice.
                    (B) Finality of assessment.--If, with respect to 
                any assessment under subparagraph (A), a hearing is not 
                requested pursuant to paragraph (5) within the period 
                of time allowed under such paragraph, the assessment 
                shall constitute a final and unappealable order.
            (3) Authority to modify or remit penalty.--The Secretary 
        may compromise, modify, or remit any penalty which the 
        Secretary may assess or already has assessed under paragraph 
        (1).
            (4) Mitigating factors.--In determining the amount of a 
        penalty under paragraph (1) with respect to any person, the 
        Secretary shall take into account the appropriateness of the 
        penalty with respect to--
                    (A) the gravity of the offense;
                    (B) any history of previous violations by the 
                person;
                    (C) the ability of the person to pay the penalty;
                    (D) injury to the public;
                    (E) benefits received by the person as a result of 
                the violation;
                    (F) the deterrent effect of the penalty on future 
                violations by such person and other persons; and
                    (G) such other factors as the Secretary may 
                determine in regulations to be appropriate.
            (5) Hearing.--The person against whom a civil money penalty 
        is assessed under paragraph (1) shall be afforded an 
        opportunity for a hearing on the record, if such person submits 
        a request for such hearing within 20 days after the issuance of 
        the notice of the assessment.
            (6) Collection.--
                    (A) Referral.--If any person fails to pay an 
                assessment after any penalty assessed under this 
                subsection has become final, the Secretary shall notify 
                the Attorney General who shall recover the amount 
                assessed in the appropriate United States district 
                court.
                    (B) Appropriateness of penalty not reviewable.--In 
                any civil action under subparagraph (A), the validity 
                and appropriateness of the penalty shall not be subject 
                to review.
            (7) Disbursement.--All penalties collected pursuant to this 
        subsection shall be deposited into the Treasury of the United 
        States.
            (8) Agency procedures--The Secretary shall, by regulation, 
        establish standards and procedures for carrying out this 
        subsection.

SEC. 206. COMMUNITY SUPPORT REQUIREMENTS FOR MORTGAGE INSURANCE 
              COMPANIES.

    (a) In General.--Each mortgage insurance company shall--
            (1) report to the Office the number and total dollar amount 
        of each mortgage insurance policy written by the company, by 
        census tract, the race, gender, and income of applicants for 
        mortgage insurance, and the disposition of each application for 
        mortgage insurance;
            (2) demonstrate to the Secretary adequate support for 
        community credit needs; and
            (3) make public to any person the underwriting criteria for 
        any mortgage insurance the company offers.
    (b) 2-Year Reporting Requirement.--At least once during each 2-year 
period beginning after the date of enactment of this Act, each mortgage 
insurance company shall submit a report to the Office containing the 
following information:
            (1) Adequacy of availability of mortgage insurance.--The 
        extent to which adequate mortgage insurance is available in 
        low- and moderate-income and minority neighborhoods within 
        areas in which the company writes a significant number of 
        mortgage insurance policies.
            (2) Underwriting guidelines.--The extent to which 
        underwriting guidelines used by the company do not unreasonably 
        restrict access to low- and moderate-income families within 
        areas in which the company writes a significant number of 
        mortgage insurance policies.
    (c) Duties of the Office.--The Office shall conduct biennial 
community support reviews of mortgage insurance companies including 
analysis of the following:
            (1) The data collected by the Agency on the distribution of 
        the mortgage insurance company's policies by census tract and 
        data on the disparate treatment of applicants for mortgage 
        insurance based on the applicants' race, gender, and income.
            (2) The underwriting criteria employed by the company and 
        the extent to which such criteria do not unreasonably restrict 
        access to credit for low- and moderate-income and minority 
        persons or neighborhoods.
            (3) Community support statements received from the mortgage 
        insurance company.
            (4) Any other information the Secretary may require 
        mortgage insurance companies to submit.
            (5) Any comments received from the public on the community 
        support performance of the mortgage insurance company during 
        the period covered by the review under this paragraph.
    (d) Duties of the Secretary.--The Secretary shall--
            (1) solicit and accept public comment for no fewer than 90 
        days before issuing a finding in connection with the review of 
        a mortgage insurance company under subsection (c)(2); and
            (2) review the community support performance of each 
        mortgage insurance company and determine whether the company is 
        providing an adequate level of community support in the areas 
        in which such company writes a significant number of mortgage 
        insurance policies.
    (e) Performance Statement.--If, after reviewing any evidence, the 
Secretary concludes that a mortgage insurance company is not meeting 
the requirements of this section, the Secretary may require such 
company to submit a statement indicating how the company expects to 
improve its record of providing community support.

                     TITLE III--PATTERN OR PRACTICE

SEC. 301. PATTERN OR PRACTICE TAKEN INTO ACCOUNT IN CONNECTION WITH 
              DEPOSIT FACILITY APPLICATIONS.

    Section 804 of the Community Investment Act of 1977 (12 U.S.C. 
2903) is amended--
            (1) by striking ``In connection with'' and inserting ``(a) 
        In General.--In connection with''; and
            (2) by adding at the end the following new subsection:
    ``(b) Pattern or Practice.--In considering an application for a 
deposit facility by a regulated financial institution, the appropriate 
Federal financial supervisory agency shall--
            ``(1) consider whether the institution has, during the 10 
        years prior to the filing of the application, exhibited a 
        pattern or practice of opening or closing branches in a way 
        that tends to exclude low- or moderate-income or minority 
        neighborhoods; and
            ``(2) accept public comment for no fewer than 90 days 
        before making any determination as to whether the affected 
        institution has provided affordable and accessible deposit and 
        branch banking services to low- and moderate-income and 
        minority consumers within the institution's entire community.
    ``(c) Denial of Application.--If the appropriate Federal financial 
supervisory agency determines, under subsection (b)(1), that a 
regulated financial institution has exhibited a pattern or practice of 
opening or closing branches in a way that tends to exclude low- and 
moderate-income or minority communities, the agency shall deny the 
pending application, notwithstanding the institution's compliance with 
any other applicable provision of law.''.

SEC. 302. PATTERN OR PRACTICE TAKEN INTO ACCOUNT IN CONNECTION WITH 
              CERTAIN BANK HOLDING COMPANY APPLICATIONS.

    The Bank Holding Company Act of 1956 (12 U.S.C. 1841, et seq.) is 
amended--
            (1) by redesignating sections 11 and 12 as sections 12 and 
        13, respectively; and
            (2) by inserting after section 10 the following new 
        section:

``SEC. 11. PATTERN OR PRACTICE OF CLOSING DEPOSIT FACILITIES.

    ``(a) In General.--In considering an application which is subject 
to this section, the Board shall--
            ``(1) consider whether the applicant or any bank or savings 
        association affiliate of the applicant, during the 10 years 
        prior to the filing of the application, exhibited a pattern or 
        practice of opening or closing branches in a way that tends to 
        exclude low- or moderate-income or minority neighborhoods; and
            ``(2) accept public comment for no fewer than 90 days 
        before making any determination as to whether the applicant and 
        any bank or savings association affiliate of the applicant has 
        provided affordable and accessible deposit and branch banking 
        services to low- and moderate-income and minority consumers 
        within the applicant's or the affiliate's entire community.
    ``(b) Applications Subject to This Section.--The following 
applications shall be subject to this section:
            ``(1) Any application under section 3(a) by--
                    ``(A) any bank holding company to acquire control 
                of another bank or bank holding company; or
                    ``(B) any bank to acquire control of another bank 
                or any bank holding company.
            ``(2) Any application by a bank holding company to engage 
        in, or any notice by a bank holding company of such company's 
        intention to engage in, (as the case may be) any activity (or 
        to acquire the shares of any company engaged in any activity) 
        described in any paragraph of section 4(c).
    ``(c) Denial of Application.--The Board may not approve an 
application which is subject to this section (and, in the case of a 
notice of an acquisition or activity, for which the Board's approval is 
not required, the Board shall disapprove the acquisition or activity) 
if the Board determines that the applicant or any bank or savings 
association affiliate of the applicant has exhibited a pattern or 
practice of opening or closing branches in a way that tends to exclude 
low- and moderate-income or minority communities.''.

SEC. 303. PATTERN OR PRACTICE TAKEN INTO ACCOUNT IN CONNECTION WITH 
              CERTAIN SAVINGS AND LOAN HOLDING COMPANY APPLICATIONS.

    Section 10 of the Home Owners' Loan Act (12 U.S.C. 1467a) is 
amended by adding at the end the following new subsection:
    ``(t) Pattern or Practice of Closing Deposit Facilities.
            ``(1) In general.--In considering an application which is 
        subject to this subsection, the Director shall--
                    ``(A) consider whether the applicant or any bank or 
                savings association affiliate of the applicant, during 
                the 10 years prior to the filing of the application, 
                exhibited a pattern or practice of opening or closing 
                branches in a way that tends to exclude low- or 
                moderate-income or minority neighborhoods; and
                    ``(B) accept public comment for no fewer than 90 
                days before making any determination as to whether the 
                applicant and any bank or savings association affiliate 
                of the applicant has provided affordable and accessible 
                deposit and branch banking services to low- and 
                moderate-income and minority consumers within the 
                applicant's or the affiliate's entire community.
            ``(2) Applications subject to this section.--The following 
        applications shall be subject to this subsection:
                    ``(A) Any application under subsection (e) by--
                            ``(i) any savings and loan holding company 
                        to acquire control of another savings 
                        association or savings and loan holding 
                        company; or
                            ``(ii) any savings association to acquire 
                        control of another savings association or any 
                        savings and loan holding company.
                    ``(B) Any application by a savings and loan holding 
                company to engage in any activity (or to acquire the 
                shares of any company engaged in any activity) for 
                which the Director's approval is required under 
                subsection (c)(4)(A).
            ``(3) Denial of application.--The Director may not approve 
        an application which is subject to this subsection (and, in the 
        case of a notice of an acquisition or activity for which the 
        Director's approval is not required, the Director shall 
        disapprove the acquisition or activity) if the Director 
        determines that the applicant or any bank or savings 
        association affiliate of the applicant has exhibited a pattern 
        or practice of opening or closing branches in a way that tends 
        to exclude low- and moderate-income or minority communities.''.

SEC. 304. PATTERN OR PRACTICE TAKEN INTO ACCOUNT IN CONNECTION WITH 
              CERTAIN APPLICATIONS FOR MERGERS AND ACQUISITIONS OF 
              DEPOSITORY INSTITUTIONS.

    Section 18(c) of the Federal Deposit Insurance Act (12 U.S.C. 
1828(c)) is amended--
            (1) by redesignating paragraphs (9), (10), and (11) as 
        paragraphs (10), (11), and (12), respectively; and
            (2) by inserting after paragraph (8) the following new 
        paragraph:
            ``(9) Pattern or practice of closing deposit facilities.
                    ``(A) In general.--In considering an application 
                under paragraph (1) or (2), the responsible agency 
                shall--
                            ``(i) consider whether the applicant during 
                        the 10 years prior to the filing of the 
                        application, exhibited a pattern or practice of 
                        opening or closing branches in a way that tends 
                        to exclude low- or moderate-income or minority 
                        neighborhoods; and
                            ``(ii) accept public comment for no fewer 
                        than 90 days before making any determination as 
                        to whether the applicant has provided 
                        affordable and accessible deposit and branch 
                        banking services to low- and moderate-income 
                        and minority consumers within the applicant's 
                        entire community.
                    ``(B) Denial of application.--The responsible 
                agency may not approve an application under paragraph 
                (1) or (2) if the agency determines that the applicant 
                depository institution has exhibited a pattern or 
                practice of opening or closing branches in a way that 
                tends to exclude low- and moderate-income or minority 
                communities.''.

                                 <all>

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HR 1700 SC----3