[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3570 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 3570

 To amend the Federal Deposit Insurance Act to provide for a system of 
    insuring the deposits of depository institutions through a self-
  regulating system of cross-guarantees, to protect taxpayers against 
           deposit insurance losses, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           November 19, 1993

     Mr. Petri (for himself, Mr. Cox, Mr. Armey, Mr. Levy, and Mr. 
Rohrabacher) introduced the following bill; which was referred jointly 
to the Committees on Banking, Finance and Urban Affairs, the Judiciary, 
                           and Ways and Means

_______________________________________________________________________

                                 A BILL


 
 To amend the Federal Deposit Insurance Act to provide for a system of 
    insuring the deposits of depository institutions through a self-
  regulating system of cross-guarantees, to protect taxpayers against 
           deposit insurance losses, and for other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Deposit Insurance 
Reform, Regulatory Modernization, and Taxpayer Protection Act of 
1993''.
    (b) Table of Contents.--

Sec. 1. Short title; table of contents.
Sec. 2. Findings and purposes.
                 TITLE I--100 PERCENT CROSS-GUARANTEES

                        Subtitle A--Definitions

Sec. 101. Definitions.
Sec. 102. Rules of construction.
                  Subtitle B--Cross-Guarantee Process

Sec. 111. Depository institutions prohibited from operating without a 
                            cross-guarantee contract.
Sec. 112. Parties to cross-guarantee and stop-loss contracts.
Sec. 113. Requirements common to cross-guarantee and stop-loss 
                            contracts.
Sec. 114. Requirements applicable only to cross-guarantee contracts.
Sec. 115. Requirements applicable only to stop-loss contracts.
Sec. 116. Eligibility and requirements for direct guarantors.
Sec. 117. Provisions relating to cross-guarantee and stop-loss 
                            syndicates.
Sec. 118. Assumption of control of a guaranteed company by a cross-
                            guarantee syndicate.
Sec. 119. Enforcement of contracts.
               Subtitle C--Powers and Duties of the CGRC

                   CHAPTER 1--CROSS-GUARANTEE PROCESS

Sec. 121. The Cross-Guarantee Regulation Corporation.
Sec. 122. Regulation of the cross-guarantee process.
Sec. 123. Approval process for cross-guarantee and stop-loss contracts.
Sec. 124. Central electronic repository.
Sec. 125. Restrictions on closed loops.
Sec. 126. Treasury oversight of the Cross-Guarantee Regulation 
                            Corporation.
               CHAPTER 2--PROTECTION OF INSURED DEPOSITS

Sec. 128. Backup insurance on deposits at guaranteed depository 
                            institutions.
                  Subtitle D--Miscellaneous Provisions

Sec. 131. Institutions offering uninsured deposits.
Sec. 132. Preemption of state depositor preference laws.
Sec. 133. Federal Reserve lending.
Sec. 134. Advertising by guaranteed financial groups.
Sec. 135. Guaranteed depository institutions remain federally insured 
                            depositories for purposes of state law.
     Subtitle E--Transition to 100 Percent Cross-Guarantee Process

Sec. 141. Effective date of system based on minimum number of 
                            guaranteed depository institutions and 
                            amount of total assets.
Sec. 142. Mandatory phase-in of cross-guarantees after effective date 
                            of system.
Sec. 143. Appointment of conservator or receiver for institutions which 
                            fail to comply with transition 
                            requirements.
Sec. 144. Exit fees.
Sec. 145. Severance pay and related benefits for former Federal and 
                            State banking agency employees.
Sec. 146. Abolition of Federal Financial Institutions Examination 
                            Council.
Sec. 147. Abolition of the Federal Deposit Insurance Corporation.
               TITLE II--AMENDMENTS TO OTHER BANKING LAWS

Sec. 201. Amendments relating to national banks.
Sec. 202. Amendments relating to member banks.
Sec. 203. Amendments relating to savings associations.
Sec. 204. Amendments relating to savings and loan holding companies.
Sec. 205. Amendments relating to the Federal Deposit Insurance 
                            Corporation.
Sec. 206. Amendments to other banking laws.
         TITLE III--AMENDMENTS TO TITLE 11, UNITED STATES CODE

            Subtitle A--Amendments to chapter 1 of Title 11

Sec. 301. Definitions.
Sec. 302. Applicability of chapters.
Sec. 303. Public access to papers.
Sec. 304. Who may be a debtor.
            Subtitle B--Amendments to chapter 3 of Title 11

Sec. 311. Party in interest.
Sec. 312. Qualification of trustee.
Sec. 313. Notice.
Sec. 314. Automatic stay.
Sec. 315. Executory contracts and unexpired leases.
            Subtitle C--Amendments to chapter 5 of Title 11

Sec. 321. Claims of direct guarantors.
Sec. 322. Debtor's duties.
Sec. 323. Exceptions to discharge.
Sec. 324. Limitation on avoiding powers.
Sec. 325. Preferences.
Sec. 326. Fraudulent transfers and obligations.
Sec. 327. Post-petition transactions.
Sec. 328. Contractual right to liquidate a securities contract.
Sec. 329. Contractual right to liquidate a commodities contract or 
                            forward contract.
Sec. 330. Contractual right to liquidate a repurchase agreement.
Sec. 331. Contractual right to terminate a swap agreement.
            Subtitle D--Amendments to chapter 11 of Title 11

                 CHAPTER 1--AMENDMENTS TO EXISTING LAW

Sec. 341. Creditors' and equity security holders' committees.
Sec. 342. Who may file a plan.
Sec. 343. Impairment of claims or interest.
Sec. 344. Acceptance of plan.
Sec. 345. Confirmation hearing.
Sec. 346. Confirmation of plan.
Sec. 347. Effect of confirmation.
                  CHAPTER 2--ENACTMENT OF SUBCHAPTER V

Sec. 351. Guaranteed company reorganization.
Sec. 352. Inapplicability of other sections.
Sec. 353. Effective date of filing.
Sec. 354. Appointment of trustee.
Sec. 355. Liability of direct guarantors for transfers to guaranteed 
                            creditors.
Sec. 356. Effect of Federal legislation and Federal, state, and local 
                            regulations.
Sec. 357. Liquidation.
          TITLE IV--AMENDMENT TO TITLE 28, UNITED STATES CODE

Sec. 401. Venue.

SEC. 2. FINDINGS AND PURPOSES.

    The purposes of this Act are:
            (1) To create a competitive and essentially self-regulating 
        private deposit insurance marketplace by requiring each bank 
        and savings association which accepts deposits to protect the 
        full amount of dsposits held along with most other nondeposit 
        liabilities by obtaining cross-guarantee contracts from 
        syndicates of guarantors.
            (2) To induce depository institutions to lend and invest 
        wisely by authorizing guarantors who issue cross-guarantee 
        contracts to--
                    (A) charge risk-sensitive premiums for the 
                guarantees provided; and
                    (B) negotiate with the banks and savings 
                association who enter into such contracts all other 
                terms and conditions, to the extent such terms and 
                conditions are not inconsistent with this Act or other 
                provision of law.
            (3) To make the cross-guarantee process as self-regulating 
        as possible by establishing a closed system of guarantors which 
        has an inviolable ``stop-loss'' mechanism and numerous 
        constructive tensions among the participants in the system.
            (4) To regulate the cross-guarantee marketplace only to the 
        extent necessary to maintain the safety, soundness, and 
        viability of the entire cross-guarantee process and not the 
        solvency of any individual bank or savings association 
        regardless of its size.

                 TITLE I--100 PERCENT CROSS-GUARANTEES

                        Subtitle A--Definitions

SEC. 101. DEFINITIONS.

    (a) Definitions Relating To Depository Institutions, Non-Depository 
Guarantors, and Affiliates.--For purposes of this title:
            (1) Company.--The term ``company''
                    (A) means any corporation, partnership, business 
                trust, association, or similar organization; and
                    (B) does not include a branch or agency, or a group 
                of branches and agencies, of a foreign bank.
            (2) Depository institution.--The term ``depository 
        institution'' has the meaning given to such term in section 
        3(c) of the Federal Deposit Insurance Act.
            (3) Failed depository institution.--The term ``failed 
        depository institution'' means any depository institution for 
        which a conservator or receiver has been appointed by the FDIC.
            (4) Foreign bank branches and agencies.--The terms 
        ``agency'' and ``branch'', when used in connection with a 
        reference to a foreign bank, and the term ``foreign bank'' have 
        the meanings given to such terms in section 1(b) of the 
        International Banking Act of 1978.
            (5) Guaranteed banking office.--The term ``guaranteed 
        banking office'' means any branch or agency of a foreign bank 
        where the foreign bank has entered into a cross-guarantee 
        contract with a cross-guarantee syndicate.
            (6) Guaranteed company.--
                    (A) In general.--The term ``guaranteed company'' 
                means any company which has entered into, and continues 
                to be guaranteed under, a cross-guarantee contract with 
                a cross-guarantee syndicate.
                    (B) Foreign banks.--
                            (i) In general.--Notwithstanding 
                        subparagraph (A), a foreign bank shall not be a 
                        guaranteed company solely because a branch or 
                        agency of such bank is a guaranteed banking 
                        office under a cross-guarantee contract.
                            (ii) Exception for foreign banks which are 
                        subsidiaries.--Notwithstanding clause (i), a 
                        foreign bank may be a guaranteed company, if 
                        such bank is guaranteed under a cross-guarantee 
                        contract under section 112(e)(1).
            (7) Guaranteed depository institution.--The term 
        ``guaranteed depository institution'' means a depository 
        institution which is a guaranteed company.
            (8) Guaranteed financial group.--The term ``guaranteed 
        financial group'' means--
                    (A) a depository institution which is the sole 
                guaranteed company under a cross-guarantee contract;
                    (B) 2 or more companies, at least 1 of which is a 
                depository institution and all of which are guaranteed 
                companies under the same cross-guarantee contract;
                    (C) any guaranteed banking office which--
                            (i) is a branch; and
                            (ii) is the sole guaranteed banking office 
                        under a cross-guarantee contract; or
                    (D) any 2 or more branches and agencies, at least 1 
                of which is a branch and all of which ara guaranteed 
                banking offices under the same cross-guarantee 
                contract.
            (9) Nondepository guarantor.--The term ``nondepository 
        guarantor'' means any person which has entered into a stop-loss 
        contract with a stop-loss syndicate.
            (10) State depository institution.--The term ``state 
        depository institution'' has the meaning given to such term in 
        section 3(c)(5) of the Federal Deposit Insurance Act.
            (11) Terms relating to affiliation and control.--
                    (A) Affiliate.--The term ``affiliate'' means, with 
                respect to any company, any other company that 
                controls, is controlled by, or is under common control 
                with such company.
                    (B) Control.--The term ``control'' means, with 
                respect to one company's relationship to another 
                company, one company's ownership or power to, directly 
                or indirectly, vote 5 percent or more of any class of 
                voting securities of another company.
                    (C) Subsidiary.--The term ``subsidiary'' means, 
                with respect to any company, any company which such 
                company controls.
    (b) Definitions Relating To Cross-Guarantee and Stop-Loss 
Contracts.--For purposes of this title:
            (1) Cross-guarantee contract.--The term ``cross-guarantee 
        contract'' means a contract which--
                    (A) is entered into between--
                            (i) 1 or more companies, at least 1 of 
                        which is a depository institution; and
                            (ii) a cross-guarantee syndicate; and
                    (B) is approved by the Corporation under section 
                123.
            (2) Cross-guarantee obligation.--The term ``cross-guarantee 
        obligation'' means an obligation of a direct guarantor arising 
        out of a cross-guarantee or stop-loss contract, and shall 
        include the obligations of such guarantor under section 
        125(c)(2) of this title and sections 321 and 355 of title III.
            (3) Cross-guarantee syndicate.--The term ``cross-guarantee 
        syndicate'' means any group of direct guarantors which has 
        entered into a cross-guarantee contract with a guaranteed 
        financial group.
            (4) Direct guarantor.--The term ``direct guarantor'' means 
        a member of a cross-guarantee or stop-loss syndicate which has 
        entered into a cross-guarantee or stop-loss contract with a 
        guaranteed party.
            (5) Group cross-guarantee syndicate contract.--The term 
        ``group cross-guarantee syndicate contract'' means a contract 
        which--
                    (A) is entered into between 2 or more guaranteed 
                financial groups and a cross-guarantee syndicate; and
                    (B) is approved by the Corporation under sections 
                112(c)(2) and 123.
            (6) Guaranteed obligation.--
                    (A) In general.--The term ``guaranteed obligation'' 
                means an obligation of a guaranteed party on which a 
                cross-guarantee or stop-loss syndicate has guaranteed 
                performance.
                    (B) Rule of construction.--The term ``performance'' 
                under subparagraph (A) shall be construed to include 
                making payment of principal and interest at the 
                promised time of payment, such that failure to 
                immediately perform in a timely manner constitutes a 
                breach of contract.
            (7) Guaranteed party.--The term ``guaranteed party'' means 
        any guaranteed company, guaranteed banking office, or 
        nondepository guarantor.
            (8) Projected annual premium.--The term ``projected annual 
        premium'' means the amount calculated under section 116(d)(2).
            (9) Projected annual premium capacity.--The term 
        ``projected annual premium capacity'' means the amount which is 
        equal to--
                    (A) in the case of a guaranteed company, 3 percent 
                of the equity capital of the guaranteed financial group 
                which is the party guaranteed under the same cross-
                guarantee contract under which such company is a 
                guaranteed company; or
                    (B) in the case of a nondepository guarantor, 3 
                percent of the net worth of the guarantor.
            (10) Projected annual premium limit.--The term ``projected 
        annual premium limit'' means the amount which is equal to 3 
        percent of projected annual premium capacity.
            (11) Second-tier guarantor.--The term ``second-tier 
        guarantor'' means a direct guarantor of one of a guaranteed 
        party's direct guarantors.
            (12) Stop-loss contract.--The term ``stop-loss contract'' 
        means a contract which--
                    (A) is entered into between a person and a stop-
                loss syndicate; and
                    (B) is approved by the Corporation under section 
                123 of this title.
            (13) Stop-loss syndicate.--The term ``stop-loss syndicate'' 
        means any group of direct guarantors which has entered into a 
        stop-loss contract with a nondepository guarantor.
            (14) Syndicate agent.--The term ``syndicate agent'' means 
        any person who acts as the agent for the direct guarantors 
        under any cross-guarantee or stop-loss contract.
    (c) Definitions Relating to Financial Terms.--For purposes of this 
title:
            (1) Equity capital.--The term ``equity capital'' means, 
        with respect to any guaranteed financial group, the amount, as 
        valued pursuant to section 114(c), which is equal to--
                    (A) the consolidated assets of the guaranteed 
                financial group; minus
                    (B) the consolidated liabilities, including the 
                estimated liquidation value of contingent liabilities, 
                of the guaranteed financial group.
            (2) Net worth.--The term ``net worth''--
                    (A) means, with respect to a nondepository 
                guarantor, the amount which is equal to the 
                stockholders' equity, the partnership equity, the net 
                worth, or the fund balance of the guarantor, as the 
                case may be, as determined in accordance with generally 
                accepted accounting principles;
                    (B) does not include any equitable interest or 
                liability which the Corporation determines should not 
                be treated as net worth for purposes of this title; and
                    (C) in the case of any nondepository guarantor 
                which controls another nondepository guarantor or a 
                guaranteed financial group, does not include the net 
                worth or equity capital of the subsidiary guarantor or 
                group.
            (3) Premium income.--The term ``premium income'' means any 
        income accrued by a direct guarantor under any cross-guarantee 
        or stop-loss contract.
            (4) Subordinated debt.--
                    (A) In general.--The term ``subordinated debt'' 
                means any obligation assumed by a guaranteed company or 
                guaranteed banking office which is subordinate in right 
                and payment to any general creditor of the company or 
                office.
                    (B) General creditors.--The term ``general 
                creditors'' includes--
                            (i) any creditor to which a guaranteed 
                        company or guaranteed banking office has an 
                        obligation which is a guaranteed obligation 
                        under the cross-guarantee contract for such 
                        company or office, unless that creditor is 
                        otherwise specifically secured by one or more 
                        assets of the company or office; and
                            (ii) any creditor of the guaranteed company 
                        or guaranteed banking office who--
                                    (I) is not protected under the 
                                contract; and
                                    (II) is not subject to preference 
                                or subordination in a receivership or 
                                bankruptcy proceeding.
            (5) Unencumbered liquid assets.--The term ``unencumbered 
        liquid assets'' means, with respect to any nondepository 
        guarantor, the amount which is equal to the sum of--
                    (A) the total amount of cash held by the guarantor;
                    (B) the total amount on deposit for the benefit of 
                the guarantor in any transaction account at any 
                guaranteed financial group or in any Federal Reserve 
                bank, including amounts passed through any Federal home 
                loan bank or depository institution to a Federal 
                Reserve bank pursuant to the Federal Reserve Act;
                    (C) an amount equal to 95 percent of the total 
                market value of investment-grade debt securities which 
                are held by or for the benefit of the guarantor and 
                which mature in less than 5 years; and
                    (D) an amount equal to 80 percent of the total 
                market value of equity securities which are held by or 
                for the benefit of the guarantor,
        to the extent any such amount is not pledged, restricted, or 
        otherwise encumbered.
    (d) Definitions Relating to Funds.--For purposes of this title:
            (1) Cross-guarantee backup fund.--The term ``cross-
        guarantee backup fund'' means the fund established pursuant to 
        section 128(a).
            (2) Deposit.--The term ``deposit'' has the meaning given to 
        such term in section 3(1) of the Federal Deposit Insurance Act, 
        except that such term does not include any obligation which, 
        under section 114(a)(2), may not be a guaranteed obligation.
            (3) FDIC severance fund.--The term ``FDIC severance fund'' 
        means the fund established under section 145(d)(1) and 
        administered by the FDIC for the purpose of providing severance 
        pay and related benefits for employees of Federal or State 
        agencies engaged in the regulation of depository institutions 
        as of the date of the enactment of this Act.
            (4) Insured deposit.--The term ``insured deposit'' means 
        any deposit of a guaranteed depository institution which is 
        insured against loss by the cross-guarantee backup fund under 
        section 128.
    (e) Definitions of Other Terms.--For purposes of this title:
            (1) Business day.--The term ``business day'' means any day 
        other than a Saturday, Sunday, or legal holiday for the Federal 
        Government.
            (2) Central electronic repository.--The term ``central 
        electronic repository'' means the repository established 
        pursuant to section 124(a)(1).
            (3) Closed loop.--The term ``closed loop'' means a set of 
        cross-guarantee and stop-loss contracts in which any person 
        which is a direct guarantor under any contract which is part of 
        such set of contracts, and any person which is directly or 
        indirectly liable for a guaranteed obligation of any such 
        direct guarantor, are persons which are guaranteed under a 
        cross-guarantee or stop-loss contract which is part of such set 
        of contracts.
            (4) Corporation.--The term ``Corporation'' means the Cross-
        Guarantee Regulation Corporation.
            (5) Cross-guarantee activation date.--The term ``cross-
        guarantee activation date'' means the date on which the first 
        cross-guarantee contracts become effective under section 
        141(a).
            (6) FDIC.--The term ``FDIC'' means the Federal Deposit 
        Insurance Corporation.

SEC. 102. RULES OF CONSTRUCTION.

    (a) In General.--This title shall be liberally construed and 
applied to promote its underlying purposes and policies.
    (b) Specific Rules of Construction.--In this title--
            (1) the terms ``guaranteed company,'' ``guaranteed 
        depository institution,'' ``guaranteed party,'' and 
        ``nondepository guarantor'' refer to a party in such party's 
        capacity as a party guaranteed under a cross-guarantee or stop-
        loss contract;
            (2) the term ``direct guarantor'' refers to a party in such 
        party's capacity as a guarantor under a cross-guarantee or 
        stop-loss contract;
            (3) the use of the word ``control'' in such phrases as 
        ``assumption of control'' or ``assumes control'' shall not take 
        on the meaning given the word control under section 
        101(a)(11)(B);
            (4) ``including'' is not limiting; and
            (5) the phrases ``has entered into a cross-guarantee 
        contract'' and ``has entered into a stop-loss contract,'' as 
        used in sections 101(a)(5), 101(a)(6), and 101(a)(9), shall not 
        be construed to refer to a contract which is no longer in 
        effect.

                  Subtitle B--Cross-Guarantee Process

SEC. 111. DEPOSITORY INSTITUTIONS PROHIBITED FROM OPERATING WITHOUT A 
              CROSS-GUARANTEE CONTRACT.

    After the applicable effective date under section 142, a depository 
institution shall be a guaranteed depository institution or guaranteed 
banking office unless the depository institution--
            (a) is a Federal branch that is not an insured branch (as 
        the terms ``Federal branch'' and ``insured branch'' are defined 
        in sections 3(r) and 3(s) of the Federal Deposit Insurance 
        Act);
            (b) is a failed depository institution; or
            (c) has not yet had a conservator or receiver appointed by 
        the FDIC under section 143.

SEC. 112. PARTIES TO CROSS-GUARANTEE AND STOP-LOSS CONTRACTS.

    (a) Cross-Guarantee Contracts.--
            (1) In general.--Each cross-guarantee contract shall have 
        at least the following parties:
                    (A) A guaranteed financial group as the party 
                guaranteed under the contract.
                    (B) The direct guarantors of the guaranteed 
                financial group.
                    (C) A syndicate agent acting on behalf of the 
                direct guarantors.
            (2) Affiliate guarantee.--Any affiliate of a depository 
        institution may guarantee the performance of such institution's 
        guaranteed obligations under a cross-guarantee contract.
    (b) Stop-Loss Contracts.--
            (1) In general.--Each stop-loss contract shall have at 
        least the following parties:
                    (A) A nondepository guarantor as the party 
                guaranteed under the contract.
                    (B) The direct guarantors of the nondepository 
                guarantor.
                    (C) A syndicate agent acting on behalf of the 
                direct guarantors.
            (2) Affiliate guarantee.--Any affiliate of a nondepository 
        guarantor may guarantee the performance of the guaranteed 
        obligations of such nondepository guarantor.
    (c) Group Cross-Guarantee Syndicate Contracts.--
            (1) In general.--
                    (A) Pooling of risk.--Subject to the provisions of 
                this subsection, the cross-guarantee contracts of 2 or 
                more guaranteed financial groups may be pooled for 
                syndication.
                    (B) Separate contract for a syndicate of pooled 
                contracts.--The direct guarantors comprising the cross-
                guarantee syndicate for a group of cross-guarantee 
                contracts may enter into a separate contract 
                (hereinafter ``group cross-guarantee syndicate 
                contract'') under which the cross-guaranteed contracts 
                pooled under such contract shall be incorporated by 
                reference.
                    (C) Proportional risk.--Each direct guarantor under 
                a group cross-guarantee syndicate contract shall have 
                the same proportional rights, privileges, duties, and 
                obligations in each cross-guarantee contract 
                incorporated by reference in the syndicate contract as 
                such guarantor has in the syndicate contract.
            (2) Approval of group cross-guarantee syndicate contract 
        and its pool of cross-guarantee contracts.--The Corporation 
        shall approve or reject, as a group, a proposed group cross-
        guarantee syndicate contract and the cross-guarantee contracts 
        pooled under that contract.
            (3) Aggregation of assets for purposes of risk 
        diversification.--The assets of all guaranteed parties pooled 
        under a group cross-guarantee syndicate contract shall be 
        aggregated for purposes of applying the risk diversification 
        requirement established in section 114(b).
            (4) No cross liability of guaranteed parties.--No 
        guaranteed party under any cross-guaranteed contract shall be 
        liable for any portion of the guaranteed obligations of a 
        guaranteed party under any other cross-guarantee contract which 
        is pooled under the same group cross-guarantee syndicate 
        contract.
            (5) Individual terms and rates.--The terms, conditions, and 
        premium rates under each cross-guarantee contract which is 
        pooled under a group cross-guarantee syndicate contract may 
        differ from the terms, conditions, and premium rates under any 
        other cross-guarantee contract which is pooled under the 
        syndicate contract.
            (6) Parties to individual cross-guarantee contracts retain 
        same rights and duties.--No right, privilege, duty, or 
        obligation applicable under this title to any party to a cross-
        guarantee contract shall be affected by the inclusion of the 
        cross-guarantee contract in a pool of contracts covered under a 
        group cross-guarantee syndicate contract.
            (7) Additional guaranteed parties under a group cross-
        guarantee syndicate contract.--A group cross-guarantee 
        syndicate contract can be amended under section 123 to add a 
        guaranteed financial group or a depository institution with a 
        proposed cross-guarantee contract to the existing syndicate 
        contract if--
                    (A) the syndicate contract remains in compliance 
                with all of the provisions of this title after the 
                addition of the institution to the syndicate contract; 
                and
                    (B) the life of the syndicate contract is not 
                extended beyond the original term of any cross-
                guarantee contract already pooled under the syndicate 
                contract by the addition of the institution.
            (8) Life of a group cross-guarantee syndicate contract.--A 
        group cross-guarantee syndicate contract shall continue in 
        force until each guaranteed party which is guaranteed under the 
        syndicate contract has ceased to be a guaranteed party under a 
        cross-guarantee contract which is pooled under the syndicate 
        contract.
            (9) Length of cross-guarantee contract pooled under a 
        syndicate contract.--No cross-guarantee contract pooled under a 
        group cross-guarantee syndicate contract shall have a term 
        longer than the remaining term of the syndicate contract.
            (10) Rule of construction.--Nothing in this subsection 
        shall be construed as preventing a cross-guarantee or stop-loss 
        syndicate from becoming a syndicate under 2 or more cross-
        guarantee or stop-loss contracts without including such 
        contracts under a group cross-guarantee syndicate contract.
    (d) Affiliates and Other Parties Related To a Depository 
Institution Which Shall be Guaranteed Under 1 Contract.--
            (1) In general.--Subject to paragraph (4), a guaranteed 
        depository institution shall be guaranteed under the same 
        cross-guarantee contract under which any other affiliated 
        guaranteed depository institution is guaranteed.
            (2) Chain banks.--Subject to paragraph (4), if more than 
        two-thirds of the shares of any depository institution are 
        under common ownership or control with more than two-thirds of 
        the shares of any other depository institution, such depository 
        institutions shall be guaranteed depository institutions under 
        the same cross-guarantee contract.
            (3) Domestic branches and agencies of foreign banks.--If 
        any branch of a foreign bank enters into a cross-guarantee 
        contract with a cross-guarantee syndicate, all branches and 
        agencies of such foreign bank shall be guaranteed banking 
        offices under the same cross-guarantee contract.
            (4) Regulations.--With respect to any depository 
        institution controlled by more than 1 unaffiliated company, the 
        Corporation shall prescribe regulations determining under which 
        cross-guarantee contract the institution shall be a guaranteed 
        depository institution.
    (e) Subsidiaries Which May Be Guaranteed Under 1 Cross-Guarantee 
Contract.--
            (1) In general.--Any company controlled by a guaranteed 
        depository institution may be a guaranteed company under the 
        same cross-guarantee contract under which such depository 
        institution is guaranteed.
            (2) Definition of control.--For purposes of this 
        subsection, the term ``control'' means, with respect to a 
        guaranteed depository institution's relationship to another 
        company, the guaranteed depository institution's ownership or 
        power to, directly or indirectly, vote more than 50 percent of 
        any class of voting securities of the other company.
    (f) Provisions Relating To Syndicate Agents.--
            (1) Anti-affiliation rules.--A syndicate agent may not--
                    (A) be an affiliate of any other person who is a 
                party to any cross-guarantee or stop-loss contract; or
                    (B) acquire or retain any ownership interest in any 
                such person.
            (2) No depository institution, foreign bank, or non-
        depository guarantor may be a syndicate agent.--No depository 
        institution, foreign bank, or nondepository guarantor may be a 
        syndicate agent.
            (3) No syndicate agent may be a direct guarantor.--No 
        person who is a syndicate agent under any cross-guarantee or 
        stop-loss contract may be, as long as such contract is in 
        effect, a direct guarantor under any cross-guarantee or stop-
        loss contract.
            (4) Prohibition on interlocks.--No director, officer, 
        employee, or subcontractor of a syndicate agent under any 
        cross-guarantee or stop-loss contract or any director, officer, 
        or employee of such subcontractor may be a director, officer, 
        or employee of any other party to such contract.

SEC. 113. REQUIREMENTS COMMON TO CROSS-GUARANTEE AND STOP-LOSS 
              CONTRACTS.

    (a) Stop-Loss Limit for Losses of a Guaranteed Party as a Direct 
Guarantor of Other Guaranteed Parties.--
            (1) Definitions.--For purposes of this subsection:
                    (A) Level 1 party.--The term ``Level 1 party'' 
                means a guaranteed party under any cross-guarantee or 
                stop-loss contract.
                    (B) Level 2 party.--The term ``Level 2 party'' 
                means a direct guarantor of a Level 1 party.
                    (C) Level 3 party.--The term ``Level 3 party'' 
                means a direct guarantor of a Level 2 party.
                    (D) Loss.--The term ``loss'' means the present 
                value, as of the date of a loss event, of the cash 
                outlays required to fulfill a Level 2 party's cross-
                guarantee obligations to a Level 1 party due to the 
                occurrence of such loss event, using as a discount rate 
                the sum of--
                            (i) 2 percent; and
                            (ii) the average annual percentage yield on 
                        3-month bills issued by the Secretary of the 
                        Treasury under section 3104(a) of title 31, 
                        United States Code, as determined by the 
                        Corporation as of the most recent issue date 
                        preceding the date of the loss event.
                    (E) Loss event.--The term ``loss event'' means any 
                event described in paragraph (3).
                    (F) Stop-loss liability.--The term ``stop-loss 
                liability'' means a debt accrued by a Level 3 party 
                under a cross-guarantee or stop-loss contract due to 
                its obligation to a Level 2 party under paragraph (2).
                    (G) Stop-loss recovery.--The term ``stop-loss 
                recovery'' means the amount accrued in any calendar 
                month by a Level 2 party due to the obligation of a 
                Level 3 party under paragraph (2).
            (2) Stop-loss obligation of direct guarantors.--
                    (A) Stop-loss recovery.--For any 12-calendar month 
                period in which a cross-guarantee or stop-loss contract 
                exists between Level 3 parties and a Level 2 party as 
                of the end of the first calendar month of such period, 
                Level 3 parties shall be obligated to pay to a Level 2 
                party an amount equal to the total amount of losses 
                accrued by the Level 2 party in such party's capacity 
                as a direct guarantor of Level 1 parties during such 
                12-calendar month period, minus the sum of--
                            (i) the greater of--
                                    (I) the amount equal to 5 times the 
                                total amount of cross-guarantee and 
                                stop-loss premium income accruing to a 
                                Level 2 party in such party's capacity 
                                as a direct guarantor of Level 1 
                                parties during such 12-calendar month 
                                period;
                                    (II) the amount equal to 5 times 
                                the total amount of cross-guarantee and 
                                stop-loss premium income accruing to 
                                the Level 2 party in such party's 
                                capacity as a direct guarantor of Level 
                                1 parties during the 12-calendar month 
                                period preceding such 12-calendar month 
                                period; or
                                    (III) in the case of a calendar 
                                month which is among the first 11 
                                calendar months that the Level 2 party 
                                has ever been a party guaranteed under 
                                a cross-guarantee or stop-loss 
                                contract, the amount equal to the 
                                average monthly cross-guarantee and 
                                stop-loss premium income accruing to 
                                the Level 2 party in such party's 
                                capacity as a direct guarantor of Level 
                                1 parties since first becoming a party 
                                guaranteed under a cross-guarantee or 
                                stop-loss contract, multiplied by 60; 
                                and
                            (ii) recoveries accrued under this 
                        paragraph by the Level 2 party for each 12-
                        calendar month period ending at the end of each 
                        of the first 11 calendar months in such 12-
                        calendar month period.
                    (B) Carryover from previous contracts.--The amounts 
                calculated in subparagraph (A) shall include all 
                losses, premium income, and stop-loss recoveries of the 
                Level 2 party under any cross-guarantee or stop-loss 
                contracts under which the Level 2 party was a party 
                guaranteed during such 12-calendar month period.
                    (C) Merger of two or more guaranteed parties.--In 
                the case of any Level 2 party which merged with any 
                other party which was a Level 2 party guaranteed under 
                another cross-guarantee or stop-loss contract, the 
                amounts calculated in subparagraph (A) shall include 
                all losses, premium income, and stop-loss recoveries of 
                both of the parties prior to the merger.
                    (D) Other guaranteed parties under the contract 
                which were previously direct guarantors.--The amounts 
                calculated in subparagraph (A) for the Level 2 party 
                shall include all losses, premium income, and stop-loss 
                recoveries of any other party guaranteed under the same 
                cross-guarantee contract as the Level 2 party, which 
                occurred while such other party was a Level 2 party 
                while guaranteed under the same or another cross-
                guarantee or stop-loss contract.
                    (E) Timing of stop-loss recovery.--A stop-loss 
                recovery shall be accrued as of the last day of the 
                last calendar month of the 12-calendar month period 
                under which the stop-loss recovery was calculated.
                    (F) Adjustment for catastrophic losses.--
                            (i) In general.--If, for any calendar 
                        month, a closed loop exists in which every 
                        guaranteed party guaranteed under a contract in 
                        the closed loop accrues a stop-loss recovery 
                        for such month, then the calculation of stop-
                        loss recovery for the 12-calendar month period 
                        ending in such month for all the contracts in 
                        the closed loop shall be adjusted as required 
                        under clauses (ii) and (iii).
                            (ii) Adjustment.--If, for any calendar 
                        month, a closed loop meets the conditions of 
                        clause (i), the amounts calculated in 
                        subparagraph (A) shall, for the 12-calendar 
                        month period in which such calendar month is 
                        the last month, be adjusted by increasing from 
                        5 to 6, under clauses (i)(I) and (i)(II) of 
                        subparagraph (A), the amount multiplied by the 
                        premium income accruing to a Level 2 party and 
                        by increasing from 60 to 72, under clause 
                        (i)(III) of subparagraph (A), the amount, 
                        multiplied by the average monthly premium 
                        accruing to the Level 2 party.
                            (iii) Further adjustment.--If, after making 
                        the adjustments to the calculation of stop-loss 
                        recovery under clause (ii), every contract in 
                        the closed loop under clause (i) still accrues 
                        a stop-loss recovery, the amounts under (i)(I) 
                        and (i)(II) shall be increased by one and the 
                        amount under (i)(III) shall be increased by 
                        twelve, until at least one guaranteed party 
                        guaranteed under a contract in such closed loop 
                        is not accruing a stop-loss recovery for the 
                        calendar month in clause (i).
            (3) Determination of time of loss.--A Level 2 party shall 
        accrue a loss as the direct guarantor of a Level 1 party as 
        of--
                    (A) the last day of the calendar month in which a 
                Level 1 party accrues a stop-loss recovery; or
                    (B) the date on which, with respect to a Level 1 
                party which is a guaranteed company, the earliest of 
                the following events occurs:
                            (i) Notice is filed with the Corporation 
                        under section 118(d)(2)(C) by the cross-
                        guarantee syndicate of which the Level 2 party 
                        is a member that the syndicate has assumed 
                        control of the Level 1 party.
                            (ii) A transaction which--
                                    (I) involves the acquisition of the 
                                Level 1 party or a significant portion 
                                of the party's assets, the merger of 
                                the Level 1 party with any other party, 
                                the liquidation of the Level 1 party, 
                                or any other transaction involving a 
                                significant portion of the assets or 
                                liabilities of the Level 1 party; and
                                    (II) results directly in a loss for 
                                which the Level 2 parties are liable 
                                under the cross-guarantee contract.
                            (iii) The Level 1 party becomes a debtor in 
                        a case under title 11, United States Code.
            (4) Preparation of original loss estimate by syndicate 
        agent.--The syndicate agent for the cross-guarantee contract 
        under which a Level 2 party is a direct guarantor shall, 
        whenever a loss event under subparagraph (3)(B) occurs under 
        such contract--
                    (A) estimate the loss for such loss event; and
                    (B) by the 15th day of the calendar month following 
                the calendar month in which such loss event occurs, 
                notify the central electronic repository of the 
                estimate of the loss under subparagraph (A).
            (5) Revision of loss estimate by syndicate agent.--The 
        syndicate agent for the cross-guarantee contract under which 
        the Level 2 party is a direct guarantor shall, whenever a loss 
        event under subparagraph (3)(B) occurs under such contract--
                    (A) revise the original estimate of the loss for 
                such loss event and notify the central electronic 
                repository of such revised estimate at least as often 
                as the 15th day of--
                            (i) the third calendar month following the 
                        calendar month in which the loss event took 
                        place;
                            (ii) the twelfth calendar month following 
                        the calendar month in which the loss event took 
                        place; and
                            (iii) every twelfth month after the 
                        calendar month in clause (ii); and
                    (B) for each estimate of the loss described in 
                clauses (A)(ii) and (A)(iii), obtain from a third party 
                a confirmation of the reasonableness of the revised 
                estimate of the loss.
            (6) Completion of cash outlays becomes final amount.--
        Notwithstanding paragraph (5), once the Level 2 parties have 
        made the final cash disbursement to fulfill such parties' 
        cross-guarantee obligations due to any loss event under 
        subparagraph (3)(B).--
                    (A) the syndicate agent for the cross-guarantee 
                contract under which the Level 2 parties are direct 
                guarantors shall calculate the loss from such loss 
                event (subject to the third party confirmation in 
                subparagraph (5)(B)) and notify the central electronic 
                repository of this calculation; and
                    (B) no further revisions of the loss from such loss 
                event need take place.
            (7) Calculation and clearinghouse duties of central 
        electronic repository.--
                    (A) Calculation of stop-loss liability.--After 
                notification under paragraphs (4), (5), and (6), the 
                central electronic repository shall calculate the stop-
                loss recovery for every Level 2 party for every 12-
                month calendar period affected by the estimates, 
                revised estimates, and final loss amounts.
                    (B) Adjustment for interest.--Upon completing the 
                calculations under subparagraph (A), the central 
                electronic repository shall then adjust the amounts 
                owed between Level 2 and Level 3 parties as outlined in 
                paragraph (8).
                    (C) Netting calculation.--Upon completing the 
                calculations under subparagraph (B), the central 
                electronic repository shall, for each person that is a 
                direct guarantor or guaranteed party, net the amounts 
                owed by such person in its capacity as a Level 3 party 
                with the amount such person is entitled to receive in 
                its capacity as a Level 2 party to determine the 
                overall liability or right to payment for such person.
                    (D) Notification of parties.--Within five business 
                days after receiving notification under paragraphs (4), 
                (5), and (6), the central electronic repository shall 
                notify any Level 2 party or Level 3 party of the 
                results of the calculations under subparagraphs (A), 
                (B), and (C).
                    (E) Settlement.--
                            (i) Receipt of payments.--Within three 
                        business days after receiving notification 
                        under subparagraph (D), each party which, given 
                        the calculations under subparagraph (C), has a 
                        net liability shall pay the amount of such 
                        liability to the central electronic repository.
                            (ii) Disbursal of payments.--Upon receiving 
                        all payments under clause (i), the central 
                        electronic repository shall promptly disburse 
                        to each party which has a right to payment, 
                        given the calculations under subparagraph (C), 
                        the amount owed such party.
                            (iii) Penalties for late payment.--If an 
                        obligation under clause (i) is not paid in a 
                        timely manner, any party which fails to perform 
                        its obligation under this title to pay the 
                        balance owed under clause (i), including the 
                        guarantors of the specific party most directly 
                        liable under clause (i), shall be liable to the 
                        Corporation for damages of 10 percent of the 
                        unpaid amount for which the party is obliged, 
                        plus interest at the rate specified under 
                        subparagraph (C) of paragraph (8).
                    (F) Regulations.--The Corporation may prescribe 
                regulations necessary to implement this paragraph.
            (8) Calculation of stop-loss payments plus interest.--
                    (A) Original estimate.--If a determination under 
                subparagraph (7)(A) is based on the original estimate 
                of loss under paragraph (4) and results in a stop-loss 
                recovery for the Level 2 party, each Level 3 party 
                shall owe to the Level 2 party the amount of the stop-
                loss liability for such Level 3 party plus interest on 
                the amount of such liability from the last day of the 
                month in which the loss occurred to the date of payment 
                under this subparagraph.
                    (B) Revision of estimates.--If a determination 
                under subparagraph (7)(A) results in--
                            (i) an increase from the previous estimate 
                        of the stop-loss recovery for a particular 
                        month, then each Level 3 party shall owe to the 
                        Level 2 party the amount of the increase in the 
                        Level 3 party's stop-loss liability plus 
                        interest on the amount of the increase in such 
                        liability from the last day of such month until 
                        payment is made under this clause; or
                            (ii) a decrease from the previous estimate 
                        of the stop-loss recovery for a particular 
                        month, then the Level 2 party shall owe each 
                        Level 3 party the amount of the decrease in 
                        such Level 3 party's stop-loss liability plus 
                        interest on the amount of the decrease in such 
                        liability from the last day of such month until 
                        payment is made under this clause.
                    (C) Interest rate.--The parties to any cross-
                guarantee or stop-loss contract shall agree to the 
                interest rate to be used for the calculation of 
                interest under subparagraphs (A) and (B).
    (b) Direct Guarantor's Cross-Guarantee Obligations Under the 
Contract are Independent Form Other Parties' Obligations.--The cross-
guarantee obligations of a direct guarantor under any cross-guarantee 
or stop-loss contract shall be independent of any obligation of any 
other party under the contract.
    (c) Guaranteed Party Cannot be a Direct Guarantor Under the Same 
Contract.--No guaranteed party can be a direct guarantor under the 
cross-guarantee or stop-loss contract under which such party is a 
guaranteed party.
    (d) Direct Guarantors Prohibited From Obtaining Collateral for 
Cross-Guarantee Obligations.--No direct guarantor under any cross-
guarantee or stop-loss contract may obtain or retain a security 
interest in a guaranteed party under the contract, or in any assets of 
the guaranteed party, in connection with such guarantor's cross-
guarantee obligations under the contract, unless the guaranteed party 
is a guaranteed banking office.
    (e) Provisions of Contract Regarding Division of Liability.--
            (1) Several liability.--No direct guarantor under any 
        cross-guarantee or stop-loss contract shall be liable for the 
        cross-guarantee obligations of any other direct guarantor under 
        the contract.
            (2) Division of liability.--Subject to the risk 
        diversification requirements of section 116(d), the terms of a 
        cross-guarantee or stop-loss contract shall establish the 
        division of liability among the direct guarantors under the 
        contract.
            (3) Liability of direct guarantor proportionate to interest 
        in syndicate.--The rights, privileges, duties, and obligations 
        of a direct guarantor under a cross-guarantee or stop-loss 
        contract shall be proportionate to such guarantor's interest in 
        the syndicate.
            (4) Syndicates not partnerships or joint ventures.--
        Notwithstanding any state law, a cross-guarantee or stop-loss 
        syndicate is not a partnership or joint venture, except for 
        purposes of section 117(c)(1).
    (f) Premium Requirements.--
            (1) In general.--Each cross-guarantee and stop-loss 
        contract shall describe the method for calculating and the 
        timing of payment for any premium payable to the direct 
        guarantors under the contract.
            (2) Restriction on repricing of risk due to stop-loss 
        obligation.--No method of calculating the premium payable under 
        paragraph (1) shall, directly or indirectly, take into account 
        losses that a guaranteed party accrues while guaranteed under 
        the contract in such party's capacity as a direct guarantor 
        under another cross-guarantee or stop-loss contract.
    (g) Maximum Effective Period of Contract.--
            (1) Length of contract.--A cross-guarantee or stop-loss 
        contract may not have an effective period of more than 5 years.
            (2) Amendments.--The parties to any cross-guarantee or 
        stop-loss contract may agree to extend the length of the 
        contract as long as the contract as amended still expires 
        within 5 years after the original effective date of the 
        contract.
            (3) Renewal of contract must be approved by the 
        corporation.--No cross-guarantee or stop-loss contract may be 
        renewed by the parties to the contract, and no successor 
        contract may become effective, without the approval of the 
        Corporation under section 123.
            (4) Penalties for continuing contract after expiration 
        date.--For every day after the 30th day following the 
        expiration of a cross-guarantee contract in which--
                    (A) the direct guarantors have not assumed control 
                under section 118(a) of all the guaranteed companies 
                guaranteed under the contract;
                    (B) a guaranteed party under such contract has not 
                become a guaranteed party under another cross-guarantee 
                contract;
                    (C) a successor contract is not being considered 
                for approval under section 123 or the Corporation has 
                already rejected two successor contracts;
                    (D) the guaranteed party is not appealing the 
                rejection by the Corporation, under section 123, of a 
                successor contract or final judgment has been reached 
                on such an appeal; or
                    (E) the guaranteed party is not a debtor under any 
                proceeding under title 11 of the United States Code,
        the Corporation may at its discretion penalize each direct 
        guarantor under such contract up to $100,000.
    (h) Cancellation of Contracts By Syndicates.--
            (1) Right to cancel.
                    (A) Default rule.--Unless otherwise agreed in a 
                cross-guarantee or stop-loss contract, a cross-
                guarantee or stop-loss syndicate may cancel such 
                contract at any time without cause provided that the 
                syndicate agent under such contract provides written 
                notice of such cancellation to the Corporation and the 
                guaranteed party or parties under the contract at least 
                90 days prior to the effective date of cancellation.
                    (B) Minimum notice period required.--The parties to 
                a cross-guarantee or stop-loss contract may agree to 
                cancellation rules different than those provided under 
                subparagraph (A), provided that the contract still 
                requires the syndicate agent under the contract to give 
                written notice of cancellation to the Corporation and 
                to the guaranteed party or parties under the contract 
                at least 90 days prior to the effective date of the 
                cancellation.
            (2) Cancellation of one guaranteed financial group under a 
        group contract.--A cross-guarantee syndicate may cancel a 
        cross-guarantee contract with 1 guaranteed financial group 
        under a group cross-guarantee syndicate contract without 
        affecting the rights, privileges, duties, and obligations 
        arising out of the syndicate contract with regard to the other 
        guaranteed financial groups under the syndicate contract.
            (3) Limitations on guaranteed party.--A guaranteed party 
        under any cross-guarantee or stop-loss contract may not become 
        a direct guarantor under any other cross-guarantee or stop-loss 
        contract during any of the following periods:
                    (A) The period beginning on the date such party 
                receives a notice of cancellation under paragraph (1) 
                or (2) with respect to such contract and ending on the 
                date the party becomes a guaranteed party under a 
                successor contract.
                    (B) The period beginning on the date the contract 
                expires and ending on the date the party becomes a 
                guaranteed party under a successor contract.
            (4) Continued effectiveness of contracts until other 
        coverage is obtained.--
                    (A) In general.--The obligations of any party to a 
                cross-guarantee or stop-loss contract shall remain in 
                effect after the effective date of the cancellation of 
                the contract by the direct guarantors or after the 
                expiration of such contract, as the case may be, 
                until--
                            (i) the guaranteed party becomes a 
                        guaranteed party under another cross-guarantee 
                        or stop-loss contract; or
                            (ii) in the case of a guaranteed party 
                        which ceases to exist as a legal entity, the 
                        guaranteed obligations of the institution are 
                        liquidated or become guaranteed obligations 
                        covered under another cross-guarantee or stop-
                        loss contract.
                    (B) Cancellation when nondepository guarantor is 
                not a direct guarantor.--Notwithstanding subparagraph 
                (A), a cancellation of a stop-loss contract by a stop-
                loss syndicate shall take effect immediately if the 
                nondepository guarantor which is the party guaranteed 
                under the contract--
                            (i) is not at the time of cancellation of 
                        direct guarantor under any cross-guarantee or 
                        stop-loss contract; and
                            (ii) has transferred any remaining risk 
                        under any cross-guarantee or stop-loss contract 
                        under which such guarantor was formerly a 
                        direct guarantor to another direct guarantor.
    (i) Cancellation of Contracts by Guaranteed Party.--
            (1) In general.--The guaranteed financial group or 
        nondepository guarantor which is the party guaranteed under a 
        cross-guarantee or stop-loss contract may notify the direct 
        guarantors under the contract at any time of such party's 
        intention to cancel the contract.
            (2) Cancellation not effective until substitute coverage is 
        obtained.--The cancellation of any cross-guarantee or stop-loss 
        contract under paragraph (1) shall not take effect until the 
        cancelling party becomes a guaranteed financial group or a 
        nondepository guarantor under another cross-guarantee or stop-
        loss contract.
            (3) Allowing nondepository guarantors to exit the 
        business.--Notwithstanding paragraph (2), a cancellation of a 
        stop-loss contract by a nondepository guarantor shall take 
        effect immediately if the nondepository guarantor--
                    (A) is not at the time of cancellation a direct 
                guarantor under any cross-guarantee or stop-loss 
                contract; and
                    (B) has transferred any remaining risk under any 
                cross-guarantee or stop-loss contract under which such 
                guarantor was formerly a direct guarantor to another 
                direct guarantor.
            (4) Cancellation fee.--The cross-guarantee or stop-loss 
        syndicate under a cross-guarantee or stop-loss contract which 
        is cancelled pursuant to paragraph (1) may impose a 
        cancellation fee in an amount determined in accordance with the 
        terms of the contract.
    (j) Continued Effectiveness of Contracts After Conversion of 
Charter of Depository Institution.--If--
            (1) any State depository institution becomes a Federal 
        depository institution;
            (2) any Federal depository institution becomes a State 
        depository institution;
            (3) any bank becomes a savings association;
            (4) or any savings association becomes a bank,
through a conversion of the charter of the depository institution, any 
cross-guarantee contract under which the institution is a guaranteed 
depository institution and which is in effect immediately before such 
conversion shall remain in effect after the conversion.
    (k) Continuing Applicability of Obligations Under the Contracts.--
            (1) No voiding or rescinding of contracts.--No party to a 
        cross-guarantee or stop-loss contract may void or rescind the 
        contract, regardless of any defense to the existence or 
        enforceability of the contract that might exist under Federal 
        or State law.
            (2) No excuses to performance.--Notwithstanding any 
        provision of Federal or State law, no excuse for the failure to 
        perform any obligation under a cross-guarantee or stop-loss 
        contract shall be effective.
            (3) Noncompliance does not affect obligations.--A party to 
        a cross-guarantee or stop-loss contract shall remain obliged 
        under the contract regardless of whether--
                    (A) the contract ceases to comply with any 
                requirement under this title; or
                    (B) one or more parties to the contract fail to 
                comply with this title.
    (l) Submission of Disputes to Arbitration.--The terms of any cross-
guarantee or stop-loss contract may provide for resolving disputes 
under the contract through binding arbitration.
    (m) Substitution of Direct Guarantors.--
            (1) In general.--Any direct guarantor's rights, privileges, 
        duties and obligations under a cross-guarantee or stop-loss 
        contract, and any portion of any such rights, privileges, 
        duties, and obligations, may be transferred to a successor 
        direct guarantor, subject to the approval of the Corporation 
        (pursuant to section 123 of this title).
            (2) Transferor no longer obliged on contract.--
        Notwithstanding any Federal or State law, a transferor of an 
        interest under paragraph (1) shall not be obliged to performed 
        on the contract should the transferee fail to perform.
            (3) Parties authorized to restrict substitution of 
        guarantors in a contract.--A guaranteed party or a cross-
        guarantee or stop-loss syndicate under a cross-guarantee or 
        stop-loss contract may provide in such contract that any 
        transfer under paragraph (1) of any interest of any direct 
        guarantor in such contract shall be subject to the approval of 
        such party or syndicate.
    (n) Syndicate Voting Rules.--
            (1) Proportional voting.--Each cross-guarantee and stop-
        loss contract shall provide that a direct guarantor's voting 
        rights in the cross-guarantee or stop-loss syndicate shall be 
        proportional to such guarantor's interest in the syndicate.
            (2) Variations permitted in voting requirements.--A cross-
        guarantee or stop-loss contract may provide that the number of 
        votes needed to approve an action by a cross-guarantee or stop-
        loss syndicate under the contract may differ depending upon the 
        action on which a vote is taken.
    (o) Guaranteed Company Can Be Covered Only Under 1 Contract.--No 
guaranteed company under any cross-guarantee or stop-loss contract may 
be a guaranteed company under another cross-guarantee or stop-loss 
contract.
    (p) Authority of the CGRC To Direct Assignment.--If any merger, 
acquisition, or other combination of 2 direct guarantors within any 
cross-guarantee or stop-loss syndicate occurs which causes the contract 
to materially exceed the limitations set forth in section 114(b)(1) or 
paragraph (1) or (2) of section 115(b), the Corporation may issue an 
order directing the merged guarantor to obtain a successor for that 
part of the guarantor's interest that exceeds the statutory limit.
    (q) Merger of 2 or More Guaranteed Companies.--After any merger, 
acquisition, or other combination of 2 or more guaranteed companies, 
the successor party's cross-guarantee or stop-loss contract shall meet 
the same requirements under section 114(b)(1) or paragraph (1) or (2) 
of section 115(b), that the successor would have to meet if the 
successor sought to become a guaranteed party under a new cross-
guarantee or stop-loss contract.
    (r) Modification of Contracts.--An agreement amending a cross-
guarantee or stop-loss contract needs no consideration to be binding.
    (s) Rule of Construction Relating to Contract Terms.--No provision 
of this title shall be construed as prohibiting any cross-guarantee or 
stop-loss contract from containing any term or condition other than 
terms or conditions which are expressly prohibited by this title.

SEC. 114. REQUIREMENTS APPLICABLE ONLY TO CROSS-GUARANTEE CONTRACTS

    (a) Obligations Guaranteed Under A Cross-Guarantee Contract.--
            (1) Obligations required to be guaranteed obligations.--The 
        following obligations of any guaranteed company or guaranteed 
        banking office shall be guaranteed obligations under a cross-
        guarantee contract:
                    (A) Deposits.--
                            (i) Banks and savings associations.--In the 
                        case of a guaranteed depository institution, 
                        all deposits (as determined without regard to 
                        subparagraph (A) or (B) of section 3(l)(5) of 
                        the Federal Deposit Insurance Act), including 
                        insured deposits, payable at any office of the 
                        guaranteed company located within or without 
                        the United States.
                            (ii) Branches of foreign depository 
                        institutions.--In the case of a guaranteed 
                        banking office, all deposits of such office 
                        payable at a location within the United States.
                    (B) Loans and advances from a direct guarantor, 
                federal reserve bank, or federal home loan bank.--All 
                loans and advances from a direct guarantor, a Federal 
                Reserve bank, or a Federal home loan bank.
                    (C) Interest-bearing obligations other than 
                subordinated debt.--All other interest-bearing 
                obligations other than subordinated debt.
                    (D) Balances due clearinghouses, the federal 
                reserve, and in settlement of other transactions.--All 
                obligations owed to clearinghouses, to the Federal 
                Reserve for funds transfers, to other funds transfer 
                systems, and to any other person in settlement of 
                financial transactions.
                    (E) Cross-guarantee obligations.--Cross-guarantee 
                obligations for which the guaranteed company is liable 
                as a direct guarantor under any other cross-guarantee 
                or stop-loss contract.
                    (F) Obligations incurred for fee income.--All other 
                direct and contingent liabilities under any contract or 
                commitment for which the guaranteed company or 
                guaranteed banking office has or may receive any fee or 
                other comparable consideration, including for any 
                letter of credit or bankers' acceptance, and any 
                securities contract, commodity contract, forward 
                contract, repurchase agreement, or swap agreement (as 
                such terms are defined in section 11(e)(8)(D) of the 
                Federal Deposit Insurance Act).
                    (G) Assessments on depository institutions for 
                costs of closed loops.--All liabilities assessed under 
                section 125(c)(2).
                    (H) Liability under recourse agreements.--Any 
                liability under recourse agreements that arises when a 
                guaranteed company or guaranteed banking office sells 
                loans or other assets.
            (2) Obligations which may not be guaranteed.--The following 
        obligations of any guaranteed company or guaranteed banking 
        office may not be guaranteed obligations under a cross-
        guarantee contract:
                    (A) Subordinated debt.--
                            (i) In general.--Subordinated debt issued 
                        by the guaranteed company or guaranteed banking 
                        office.
                            (ii) Includes debt which may be redeemed by 
                        the debtholder by check or other means.--For 
                        purposes of this subparagraph, the term 
                        ``subordinated debt'' includes subordinated 
                        debt which may be withdrawn by or credited to 
                        the debtholder by a check, wire transfer, or 
                        other order of the debtholder.
                    (B) Equity interests.--Any equity interest in the 
                guaranteed company or guaranteed banking office.
            (3) Obligations which may be included under a cross-
        guarantee contract.--
                    (A) In general.--Any obligation of any guaranteed 
                company or guaranteed banking office which is not 
                required to be, or not prohibited from being, a 
                guaranteed obligation under paragraphs (1) and (2) may 
                be a guaranteed obligation under a cross-guarantee 
                contract to the extent provided by the terms of the 
                contract.
                    (B) Rules upon switch to a successor contract.--Any 
                obligation that was a guaranteed obligation under the 
                previous cross-guarantee contract shall be a guaranteed 
                obligation under the successor contract, if such 
                obligation accrues prior to the obligee receiving 
                written notice from the syndicate agent under the 
                successor contract that obligations of the same type as 
                were guaranteed under the previous contract shall not 
                be guaranteed under the successor contract.
            (4) Judgments and settlements.--
                    (A) In general.--Subject to subparagraph (B), a 
                cross-guarantee contract may provide that any judgment 
                against a guaranteed company under the contract, or any 
                obligation of the company under a settlement agreement, 
                in any action against the company in the company's 
                capacity as trustee or custodian with respect to any 
                person, shall be treated as a guaranteed obligation of 
                such company to the extent that the company's duty to 
                act as trustee or custodian with respect to such 
                person, or to a designated 3d-party beneficiary, was 
                expressly established by written agreement of the 
                parties or by operation of law.
                    (B) Rule of construction.--Subparagraph (A) shall 
                not be construed to provide that the amount of any 
                judgment or settlement from any action arising from any 
                alleged tortious conduct, breach of contract, or 
                violation of statutory obligation (other than the 
                agreement establishing the duty of the institution to 
                act as trustee or custodian) is a guaranteed obligation 
                unless the cross-guarantee contract expressly so 
                provides.
            (5) Vicarious liability.--
                    (A) In general.--Subject to subparagraph (B), a 
                direct guarantor or syndicate agent under any cross-
                guarantee contract shall not be vicariously liable for 
                any alleged tortious conduct, breach of contract, or 
                violation of statutory obligation by any guaranteed 
                party under the contract.
                    (B) Exception for fraud related to subordinated 
                debt.--Not withstanding subparagraph (A), the liability 
                of any guaranteed party under a cross-guarantee 
                contract for damages due to the fraudulent actions of 
                such party related to marketing subordinated debt shall 
                be a guaranteed obligation under the contract.
    (b) Risk Diversification.--
            (1) Minimum number of direct and second-tier guarantors.--
        Each cross-guarantee contract shall comply with the 
        requirements relating to the maximum percentage of all 
        guaranteed obligations under the contract which may be 
        guaranteed by any 1 direct guarantor and the minimum number of 
        second-tier guarantors which the guaranteed party or parties 
        shall have in the aggregate, as determined under the following 
        table (as adjusted pursuant to paragraph (2)) on the basis of 
        the total assets of all the guaranteed parties under the 
        contract:

    ,  

----------------------------------------------------------------------------------------------------------------
                                                                Maximum percentage of                           
       Aggregate amount of assets of all guaranteed parties        cross-guarantee      Minimum number of second-
                        under the contract                     liability assumable by        tier guarantors    
                                                               any 1 direct guarantor                           
----------------------------------------------------------------------------------------------------------------
      $100,000,000 or less..................................             5.0                       100          
      Greater than $100,000,000 but less than or equal to                                          125          
       $500,000,000.........................................             4.0                                    
      Greater than $500,000,000 but less than or equal to                                          150          
       $1,000,000,000.......................................             2.5                                    
      Greater than $1,000,000,000 but less than or equal to                                        200          
       $10,000,000,000......................................             1.5                                    
      More than $10,000,000,000.............................             1.0                       250          
----------------------------------------------------------------------------------------------------------------

            (2) Adjustment of dollar amounts for inflation.--The 
        amounts contained in the table in paragraph (1) relating to the 
        aggregate assets of guaranteed parties under any cross-
        guarantee contract shall be adjusted annually by the 
        Corporation on the basis of changes in the deflator for the 
        gross domestic product.
    (c) Basis for Valuing Assets and Liabilities.--Each cross-guarantee 
contract shall describe the manner in which the equity capital of the 
guaranteed financial group shall be calculated for purposes of the 
contract.
    (d) Emergency Liquidity.--Notwithstanding section 113(e)(3), the 
parties to a cross-guarantee contract may include terms relating to the 
provision of emergency liquidity to a guaranteed party by any direct 
guarantor without regard to the relative interest in the contract held 
by any guarantor providing the liquidity.
    (e) Internal Guarantees.--A guaranteed company under any cross-
guarantee contract shall be jointly and severally liable to the direct 
guarantors under such contract for any loss incurred by the guarantors 
in connection with the cross-guarantee obligations of the guarantors to 
any other guaranteed company under such contract.

SEC. 115. REQUIREMENTS APPLICABLE ONLY TO STOP-LOSS CONTRACTS.

    (a) Guaranteed Obligations Under a Stop-Loss Contract.--
            (1) Obligations required to be guaranteed obligations.--A 
        nondepository guarantor's cross-guarantee obligations shall be 
        guaranteed obligations under a stop-loss contract.
            (2) No other guaranteed obligations.--Except for the 
        obligations described in paragraph (1), no obligation of a 
        nondepository guarantor may be a guaranteed obligation.
    (b) Risk Diversification.--
            (1) Minimum numbers of direct guarantors.--A direct 
        guarantor under a stop-loss contract may not guarantee more 
        than 2 percent of the guaranteed obligations under such 
        contract.
            (2) Second-tier guarantors.--The direct guarantors under 
        any stop-loss contract shall have, in the aggregate, no fewer 
        than 150 direct guarantors.

SEC. 116. ELIGIBILITY AND REQUIREMENTS FOR DIRECT GUARANTORS.

    (a) Eligibility.--
            (1) In general.--No person may become a direct guarantor 
        unless such person is a guaranteed company or a nondepository 
        guarantor.
            (2) Nondepository guarantor.--
                    (A) In general.--Subject to subparagraphs (B) and 
                (C) of this paragraph and subsection (c) of this 
                section, any person may be a nondepository guarantor.
                    (B) Noneligibility of depository institutions.--
                            (i) In general.--No depository institution, 
                        or subsidiary of a depository institution, may 
                        be a nondepository guarantor.
                            (ii) Rule of construction for foreign 
                        banks.--Clause (i) shall not be construed as 
                        prohibiting a foreign bank which has a branch 
                        in the United States from being a nondepository 
                        guarantor.
                            (iii) Foreign bank defined.--For purposes 
                        of clause (ii), the term ``foreign bank'' shall 
                        exclude any company organized under the laws of 
                        a territory of the United States, Puerto Rico, 
                        Guam, American Samoa, or the Virgin Islands.
                    (C) Noneligibility of governments.--
                            (i) In general.--No entity with direct or 
                        indirect taxing authority may be a 
                        nondepository guarantor.
                            (ii) Rule of construction for government 
                        pension funds.--Clause (i) shall not be 
                        construed as to prohibit any pension fund 
                        operated for the benefit of government 
                        employees from being a nondepository guarantor.
            (3) Guaranteed depository institutions authorized to be 
        direct guarantors.--Notwithstanding any other Federal or State 
        law restricting the powers of depository institutions, a 
        guaranteed depository institution may be a direct guarantor 
        under any cross-guarantee or stop-loss contract.
    (b) Designated Direct Guarantor.--
            (1) Only one guaranteed company within a guaranteed 
        financial group may be a direct guarantor.--No guaranteed 
        company shall be a direct guarantor if another guaranteed 
        company under the same cross-guarantee contract already is a 
        direct guarantor under any cross-guarantee or stop-loss 
        contract.
            (2) Designation of direct guarantor in cross-guarantee 
        contract.--In the case of a cross-guarantee contract in which 2 
        or more companies are guaranteed under the contract, the 
        contract shall designate which guaranteed company may, in 
        accordance with paragraph (1), be a direct guarantor.
    (c) Financial Resources Requirements for Nondepository 
Guarantors.--
            (1) Net worth.--No person may become a nondepository 
        guarantor unless such person has a net worth of not less than 
        $100,000,000 at the time such person would, but for this 
        paragraph, become a direct guarantor under a cross-guarantee or 
        stop-loss contract.
            (2) Liquidity resources.--Each nondepository guarantor 
        shall maintain unencumbered liquid assets in an amount equal to 
        or greater than the amount which is equal to 5 times the 
        projected annual premium from all cross-guarantee and stop-loss 
        contracts under which the nondepository guarantor is a direct 
        guarantor.
            (3) Asset requirements.--Only assets which are maintained 
        within the United States and subject to the jurisdiction of a 
        United States court may be taken into account for purposes of 
        meeting the requirements of paragraphs (1) and (2).
    (d) Risk Diversification Requirements for Direct Guarantors.--
            (1) Projected annual premium capacity and projected annual 
        premium limit.--A person may not become a direct guarantor 
        under a cross-guarantee or stop-loss contract if, upon the 
        contract (but for this paragraph) taking effect--
                    (A) the sum of the estimated annual premium which 
                the person would receive as a direct guarantor under 
                the contract and the person's projected annual premium 
                income would exceed such person's projected annual 
                premium capacity as of--
                            (i) in the case of a contract which would 
                        take effect on or before the 15th day of any 
                        calendar month, the 2d calendar month preceding 
                        such calendar month; or
                            (ii) in the case of a contract which would 
                        take effect after the 15th day of any calendar 
                        month, the end of the calendar month preceding 
                        such calendar month; or
                    (B) the estimated annual premium which the person 
                would receive as a direct guarantor under the contract 
                would exceed such person's projected annual premium 
                limit as of--
                            (i) in the case of a contract which would 
                        take effect on or before the 15th day of any 
                        calendar month, the 2d calendar month preceding 
                        such calendar month; or
                            (ii) in the case of a contract which would 
                        take effect after the 15th day of any calendar 
                        month, the end of the calendar month preceding 
                        such calendar month.
            (2) Calculation of projected annual premium.--
                    (A) In general.--The syndicate agent under any 
                cross-guarantee or stop-loss contract shall determine 
                the projected annual premium due any direct guarantor 
                for any calendar month by calculating the amount of 
                such guarantor's share of the premium accrued by the 
                guaranteed party or parties under the contract during 
                such month and then annualizing such amount.
                    (B) First two months.--During the first 2 calendar 
                months in which any cross-guarantee or stop-loss 
                contract is in effect, the syndicate agent shall 
                determine the projected annual premium under the 
                contract for each of these 2 calendar months by 
                annualizing the premium rate in effect on the date the 
                contract becomes effective.
            (3) Calculation of the estimated annual premium for the 
        approved contract.--
                    (A) In general.--For purposes of paragraph (1), the 
                term ``estimated annual premium'' means the annualized 
                premium rate likely to be in effect on the date the 
                contract becomes effective.
                    (B) Syndicate agent estimate.--The proposed 
                syndicate agent for the contract shall make an estimate 
                of the amount in paragraph (1) within five days prior 
                to the date on which the contract is to become 
                effective.
            (4) Calculation of projected annual premium income.--For 
        purposes of making any determination under paragraph (1)(A) 
        with respect to a direct guarantor, the term ``projected annual 
        premium income'' means the total projected annual premiums from 
        all cross-guarantee or stop-loss contracts under which such 
        guarantor is a direct guarantor, other than the contract for 
        which such determination is being made, as of--
                    (A) in the case of contract which would become 
                effective on or before the 15th day of any calendar 
                month, the 2d calendar month preceding such calendar 
                month; and
                    (B) in the case of a contract which would become 
                effective after the 15th day of any calendar month, the 
                calendar month preceding such calendar month.
    (e) Liability of Acquirer of Any Direct Guarantor.--Any person who 
acquires (as defined in section 13(f)(8)(B) of the Federal Deposit 
Insurance Act) any direct guarantor shall be obligated for all of the 
cross-guarantee obligations of such guarantor under any cross-guarantee 
or stop-loss contract to which such guarantor is a direct guarantor.

SEC. 117. PROVISIONS RELATING TO CROSS-GUARANTEE AND STOP-LOSS 
              SYNDICATES.

    (a) Powers and Duties of Syndicate Agents.--
            (1) Syndicate agent is agent of direct guarantors.--
                    (A) In general.--The syndicate agent under any 
                cross-guarantee or stop-loss contract shall act as an 
                agent of the direct guarantors under such contract.
                    (B) Exceptions.--Notwithstanding subparagraph (A), 
                the syndicate agent also shall have--
                            (i) a duty to protect the confidentiality 
                        of any aspect of a guaranteed party's affairs 
                        which the contract specifies shall be 
                        protected; and
                            (ii) duties to the Corporation as specified 
                        in this title.
            (2) Powers of syndicate agent.--No person under a cross-
        guarantee or stop-loss contract other than the syndicate agent 
        shall have the following powers:
                    (A) Monitor performance.--Monitor the performance, 
                or contract with a third party to monitor the 
                performance, of any party guaranteed under such 
                contract.
                    (B) Collect premiums.--Collect the premiums due to 
                the direct guarantors under such contract.
            (3) Syndicate agent reports submitted to the central 
        electronic repository.--The syndicate agent under any cross-
        guarantee or stop-loss contract shall submit in electronic form 
        to the central electronic repository by the 15th of each 
        calendar month a report--
                    (A) of the equity capital or the net worth, as the 
                case may be, of the guaranteed financial group or 
                nondepository guarantor under the contract as of the 
                end of the prior calendar month;
                    (B) of the projected annual premium due each direct 
                guarantor, as of the end of the prior calendar month; 
                and
                    (C) in the case of a stop-loss contract, of the 
                unencumbered liquid assets of the nondepository 
                guarantor as of the end of the prior calendar month.
            (4) Confirmation of guarantee of specific obligations.--
                    (A) In general.--The syndicate agent under any 
                cross-guarantee contract shall--
                            (i) determine, at the request of any 
                        current or prospective creditor of a guaranteed 
                        company or guaranteed banking office under such 
                        contract, whether--
                                    (I) the company or office has or 
                                will have an obligation to the 
                                creditor; and
                                    (II) such obligation is or would be 
                                a guaranteed obligation under the 
                                contract; and
                            (ii) promptly notify the current or 
                        prospective creditor in writing of the agent's 
                        determination.
                    (B) Determination binding on syndicate.--Any 
                notification of determination under subparagraph (A) 
                with respect to any guaranteed company or guaranteed 
                banking office shall be binding on the cross-guarantee 
                syndicate which is a party to such contract.
                    (C) Fee.--A syndicate agent may charge a creditor a 
                fee for making the determination and notifying the 
                creditor under subparagraph (A).
            (5) Side contracts.--
                    (A) In general.--Subject to subparagraph (B), no 
                direct guarantor or group of direct guarantors under a 
                cross-guarantee or stop-loss contract may enter into 
                any other contract or binding agreement pertaining to 
                the contract with the syndicate agent under such cross-
                guarantee or stop-loss contract.
                    (B) Exception for certain limited contracts.--
                Notwithstanding subparagraph (A), a syndicate agent and 
                the direct guarantors under a cross-guarantee or stop-
                loss contract may enter into another contract or 
                binding agreement if--
                            (i) the terms of such contract or agreement 
                        relate solely to rights and obligations of such 
                        parties to each other under the cross-guarantee 
                        or stop-loss contract, including the 
                        compensation of the agent, to the extent such 
                        terms are not inconsistent with the cross-
                        guarantee or stop-loss contract; and
                            (ii) the contract or agreement does not 
                        affect any right or obligation of--
                                    (I) any guaranteed party under the 
                                cross-guarantee or stop-loss contract; 
                                or
                                    (II) any creditor or shareholder of 
                                any such guaranteed company.
    (b) Syndication of Cross-Guarantee and Stop-Loss Risks.--
Notwithstanding any provision of Federal or State law, interests in any 
cross-guarantee or stop-loss syndicate are not securities for any 
purpose and any person or group of persons may organize and market the 
risk of loss represented by the participation of any person as a direct 
guarantor under any cross-guarantee or stop-loss contract.
    (c) Taxation of Syndicates.--
            (1) Treated as partnership.--Any cross-guarantee or stop-
        loss syndicate shall be treated as a partnership for purposes 
        of the Internal Revenue Code of 1986.
            (2) Consolidated returns by syndicate agent.--A syndicate 
        agent may file an annual information return with respect to all 
        syndicates for which such agent is an agent, and all 
        distributions with respect to such syndicates, on a 
        consolidated basis.
            (3) Tax-exempt status.--Any syndicate under any cross-
        guarantee or stop-loss contract, any income or gross receipts 
        (including premiums), and any activity of the syndicate shall 
        be exempt from all taxation imposed by any State, county, 
        municipality, or local taxing authority.
    (d) Audits of Syndicate Agents.--Unless otherwise agreed, the 
direct guarantors under any cross-guarantee or stop-loss contract shall 
have the right to retain a third party to audit the performance of the 
syndicate agent under the terms of the contract.
    (e) Replacement of Syndicate Agents.--
            (1) In general.--The cross-guarantee or stop-loss syndicate 
        under any cross-guarantee or stop-loss contract may at any time 
        and without cause replace the syndicate agent under such 
        contract, subject to the guaranteed financial group or 
        nondepository guarantor's approval of the new syndicate agent, 
        by amending the contract and obtaining the Corporation's 
        approval of the new syndicate agent under section 123.
            (2) No effect on contract.--The replacement of a syndicate 
        agent by the direct guarantors in accordance with paragraph (1) 
        shall not affect the continuing existence or enforceability of 
        the contract.
            (3) Withdrawal of syndicate agent.--
                    (A) Immediate submission of amended contract with 
                new syndicate agent.--If a syndicate agent should 
                resign or otherwise cease providing required services 
                under a cross-guarantee or stop-loss contract, whether 
                wrongfully, as allowed under such contract, or for any 
                other reason, the cross-guarantee or stop-loss 
                syndicate shall immediately submit an amendment to the 
                contract, with a successor syndicate agent named in the 
                amendment, to the Corporation for approval.
                    (B) Interim cgrc appointment.--The Corporation may 
                appoint a successor syndicate agent to serve until a 
                cross-guarantee or stop-loss syndicate has complied 
                with the requirements under subparagraph (A).
    (f) Cause of Action by the Syndicate Against the Syndicate Agent.--
            (1) Standard of liability.--Unless otherwise agreed, a 
        cross-guarantee or stop-loss syndicate shall have a cause of 
        action against the syndicate agent for losses accrued by 
        members of the syndicate under a cross-guarantee or stop-loss 
        contract only if the syndicate consciously disregarded 
        substantial and unjustifiable risks being taken by the 
        guaranteed party under the contract.
            (2) Cause of action belongs to the syndicate.--An action 
        against a syndicate agent under paragraph (1) may be brought 
        solely by the syndicate as a whole and no individual member of 
        the syndicate shall have a cause of action against the 
        syndicate agent.

SEC. 118. ASSUMPTION OF CONTROL OF A GUARANTEED COMPANY BY A CROSS-
              GUARANTEE SYNDICATE.

    (a) Right of Cross-Guarantee Syndicate To Assume Control.--A cross-
guarantee syndicate under any cross-guarantee contract shall have the 
right to assume control of a guaranteed company under the contract 
under the following circumstances:
            (1) Cancellation.--Immediately after a cancellation of the 
        contract by the syndicate or the guaranteed financial group has 
        become effective unless a successor cross-guarantee contract 
        has taken effect.
            (2) Expiration.--Immediately after the expiration of the 
        cross-guarantee contract unless a successor cross-guarantee 
        contract has taken effect.
    (b) Right of Guaranteed Party To Seek To Stay Assumption of 
Control.--
            (1) In general.--A guaranteed company may file an action 
        requesting a stay of any assumption of control by a cross-
        guarantee syndicate.
            (2) Time limit for objecting to assumption of control.--
        Except in the case in which the guaranteed company has obtained 
        a successor cross-guarantee contract, any action under 
        paragraph (1) shall be filed either within thirty days after 
        the notice of cancellation under section 113(h)(1) is given or 
        more than sixty days prior to the expiration of the contract, 
        whichever the case may be.
            (3) Expedited review.--The United States district court 
        with jurisdiction over the cross-guarantee contract shall 
        provide expedited review of any action under paragraph (1).
            (4) Basis of determination.--In any action under paragraph 
        (1), the court shall stay the assumption of control by a cross-
        guarantee syndicate only if the conditions for assuming control 
        under subsection (a) have not been met.
    (c) Rights of Cross-Guarantee Syndicate To Enjoin Violations of the 
Contract Until Assuming Control.--
            (1) Injunctive remedies.--Upon giving notice of 
        cancellation of the cross-guarantee contract under section 
        113(h)(1) or the expiration of the contract, the cross-
        guarantee syndicate shall be granted injunctive relief to 
        enforce any restrictions imposed under the contract.
            (2) Appointment of a receiver.--
                    (A) In general.--Upon giving notice of cancellation 
                of the cross-guarantee contract under section 113(h)(1) 
                or the expiration of the contract, the cross-guarantee 
                syndicate may seek the appointment of a receiver to 
                serve until the syndicate can assume control under 
                subsection (a) and a court may in its discretion 
                appoint such a receiver, but the court may appoint a 
                receiver only if the remedies under paragraph (1) are 
                not adequate to protect the interests of the cross-
                guarantee syndicate.
                    (B) CGRC shall submit list of prospective 
                receivers.--The court shall appoint a receiver under 
                subparagraph (A) only from a list supplied by the 
                Corporation to the court of five disinterested persons 
                who are qualified and willing to serve as the receiver 
                in the case.
            (3) Expedited relief.--The United States district court 
        with jurisdiction over the cross-guarantee contract shall 
        provide the relief under paragraphs (1) and (2) on an expedited 
        basis.
    (d) Powers and Duties of a Cross-Guarantee Syndicate After 
Assumption of Control.--
            (1) General powers.--
                    (A) Operate the company.--A cross-guarantee 
                syndicate which assumes control of a guaranteed company 
                under subsection (a) shall have and may exercise all 
                the powers of the members or shareholders, the 
                directors, and the officers of the company and shall be 
                entitled to--
                            (i) conduct all business of the guaranteed 
                        company;
                            (ii) take over the books, records, and 
                        assets of the guaranteed company;
                            (iii) collect all obligations and money due 
                        the company;
                            (iv) perform in the name of the company all 
                        functions of the company consistent with the 
                        appointment of the syndicate as the successor 
                        to the managers and directors of the company 
                        and the duties of the syndicate with respect to 
                        the company; and
                            (v) preserve and conserve the assets and 
                        property of such company.
                    (B) Disposition of company.--The cross-guarantee 
                syndicate which assumes control of a guaranteed company 
                under subsection (a) may--
                            (i) merge the guaranteed company with 
                        another guaranteed company;
                            (ii) sell or otherwise dispose of the 
                        company; or
                            (iii) place the company in liquidation and 
                        proceed to realize upon the assets of the 
                        company.
            (2) Duties--
                    (A) Distribution of assets.--In any case in which 
                funds remain from the liquidation, sale, or other 
                disposition of the assets of any guaranteed company 
                after all depositors, creditors, other claimants, and 
                administrative expenses of the syndicate have been paid 
                or otherwise resolved, the syndicate shall promptly 
                distribute such funds to the company's shareholders or 
                members, as the case may be.
                    (B) Fiduciary duty.--A cross-guarantee syndicate 
                which assumes control of a guaranteed company in 
                accordance with subsection (a) shall succeed to the 
                same fiduciary responsibility as the directors and 
                officers of such company had under applicable law.
                    (C) Notice to cgrc.--If a cross-guarantee syndicate 
                assumes control of a guaranteed company under 
                subsection (a), the syndicate shall on the same day 
                notify the Corporation that it has assumed control.
    (e) No Authority for CGRC, Any Federal Banking Agency, or State 
Bank Supervisor to Stay Assumption of Control.--Neither the Corporation 
nor any Federal banking agency, State bank supervisor, or any other 
Federal or State agency may take any action to prevent the assumption 
of control of a guaranteed company under subsection (a).
    (f) Assumption of Control Not an Event of Default or Grounds for 
Acceleration of Obligations.--The assumption of control of a guaranteed 
company under subsection (a) shall not be an event of default by the 
guaranteed company or grounds for acceleration of any guaranteed 
obligation under any agreement to which the guaranteed company is a 
party.
    (g) Second-Tier Guarantors Cannot Dispute Losses.--A direct 
guarantor of any direct guarantor which is a member of a cross-
guarantee syndicate which assumes control of a guaranteed party under 
subsection (a) may not bring a cause of action against the cross-
guarantee syndicate based on damages arising out of the syndicate's 
decision to assume control or failure to minimize losses under the 
cross-guarantee contract.

SEC. 119. ENFORCEMENT OF CONTRACTS.

    (a) Jurisdiction of Federal Courts.--
            (1) In general.--For purposes of section 1331 of title 28, 
        United States Code, any action arising under any cross-
        guarantee or stop-loss contract, or any contract arising under 
        section 117(a)(5)(B), shall be deemed to arise under Federal 
        law and may be brought in the district court of the United 
        States designated under paragraph (3).
            (2) Removal.--Any action arising under any cross-guarantee 
        or stop-loss contract, or any contract under section 
        117(a)(5)(B), which is brought in a State court may be removed 
        by the defendant or the defendants to the district court of the 
        United States designated under paragraph (3).
            (3) Designation of court in contract.--Each cross-guarantee 
        and stop-loss contract shall designate the district court of 
        the United States which shall have original jurisdiction over 
        any action brought in or removed to Federal court under 
        paragraphs (1) and (2).
    (b) Restrictions on Third Party Beneficiary Actions.--
Notwithstanding any State law, no creditor of any guaranteed party 
under any cross-guarantee or stop-loss contract may bring an action 
against the cross-guarantee syndicate under such contract for failure 
to perform any cross-guarantee obligation under the contract without 
first having obtained a judgment against the guaranteed party for 
failure to perform such obligation, unless the direct guarantors have 
assumed control of the guaranteed party under section 118(a).
    (c) Service of Process.--For purposes of any action under 
subsection (a)--
            (1) the syndicate agent shall be the agent for all direct 
        guarantors for service of process for actions brought against 
        the syndicate; and
            (2) service of process upon a syndicate agent shall serve 
        as the exclusive manner of service of process upon any direct 
        guarantor under the contract.
    (d) Applicable State Law.--
            (1) State contract law as interstitial law.--Unless 
        otherwise indicated in this title, applicable state law shall 
        apply under this title to any cross-guarantee or stop-loss 
        contract.
            (2) Parties' choice of state law.--Each cross-guarantee and 
        stop-loss contract shall designate the state law that shall be 
        applicable under paragraph (1).

               Subtitle C--Powers and Duties of the CGRC

                   CHAPTER 1--CROSS-GUARANTEE PROCESS

SEC. 121. THE CROSS-GUARANTEE REGULATION CORPORATION.

    (a) Creation.--
            (1) In general.--There is hereby established a body 
        corporate the ``Cross Guarantee Regulation Corporation'' which 
        shall have succession until dissolved by act of Congress.
            (2) Corporation not an agency.--The Corporation shall not 
        be an agency or establishment of the United States Government.
            (3) Headquartered in the district of columbia.--The 
        Corporation shall maintain its principal office in the District 
        of Columbia.
    (b) Powers.--In addition to any powers granted to the Corporation 
elsewhere in this title, the Corporation shall have, consistent with 
this title, the power--
            (1) to sue and be sued, complain and defend, in its 
        corporate name and through its own counsel, in any State, 
        Federal, or other court;
            (2) to adopt, alter, and use a corporate seal which shall 
        be judicially noticed;
            (3) to adopt, amend, and repeal, by its Board of Directors, 
        such bylaws as may be necessary or appropriate to carry out the 
        purposes of this title, including bylaws relating to--
                    (A) the conduct of its business; and
                    (B) the indemnity of its directors, officers, and 
                employees for liabilities and expenses actually and 
                reasonably incurred by any such person in connection 
                with the defense or settlement of an action or suit if 
                such person acted in good faith and in a manner 
                reasonably believed to be consistent with the purposes 
                of this chapter.
            (4) to adopt, amend, and repeal, by its Board of Directors, 
        such rules as authorized under subsection (e)(2) of this 
        section;
            (5) to conduct business (including the carrying on and 
        maintenance of offices) and to exercise all other rights and 
        powers granted to it by this chapter in any State or other 
        jurisdiction without regard to any qualification, licensing, or 
        other statute in such State or other jurisdiction;
            (6) to lease, purchase, accept gifts or donations of or 
        otherwise acquire, to own, hold, improve, use, or otherwise 
        deal in or with, and to sell, convey, mortgage, pledge, lease, 
        exchange or otherwise dispose of, any property, real, personal 
        or mixed, or any interest therein, wherever situated;
            (7) subject to subsection (c), to hire such officers, 
        attorneys, employees, and agents as may be required, to 
        determine their qualifications to define their duties, to fix 
        their salaries, require bonds for them and fix the penalty 
        thereof; and
            (8) to enter into contracts, to execute instruments, to 
        incur liabilities, and to do any and all other acts and things 
        as may be necessary or incidental to the conduct of its 
        business and the exercise of all other rights and powers 
        granted to the Corporation under this title.
    (c) Board of Directors.--
            (1) Functions.--The Corporation shall have a Board of 
        Directors which, subject to the provisions of this title, shall 
        determine the policies which shall govern the operations of the 
        Corporation.
            (2) Number and appointment.--The Board of Directors shall 
        consist of seven persons as follows:
                    (A) One director shall be appointed by the 
                Secretary of the Treasury from among the officers of 
                the Department of Treasury and shall be removable by 
                the Secretary without cause at any time.
                    (B) Six directors shall be appointed by the 
                President, by and with the advice and consent of the 
                Senate, as follows--
                            (i) two such directors shall be selected 
                        from among senior officers of companies that 
                        are or are likely to be guaranteed depository 
                        institutions, provided that the directors are 
                        not from the same geographical area and 
                        represent different aspects of the industry;
                            (ii) one such director shall be selected 
                        from among senior officers of companies that 
                        are or are likely to be nondepository 
                        guarantors;
                            (iii) one such director shall be selected 
                        from among senior officers of companies that 
                        are or are likely to be syndicate agents; and
                            (iv) two such directors shall be selected 
                        from the general public from among persons who 
                        are not either regulatory officials nor 
                        associated with a guaranteed depository 
                        institution, syndicate agent, or nondepository 
                        guarantor and have not been such an official or 
                        had any such association for the 2 years 
                        preceding appointment.
            (3) Chairman and vice chairman.--The President shall 
        designate a Chairman and Vice Chairman from among those 
        directors appointed under paragraph (2)(B)(iv) of this 
        subsection.
            (4) Terms.--
                    (A) Four-year terms.--Except as provided under 
                subparagraphs (B) and (C), each director shall be 
                appointed for a term of 4 years.
                    (B) Transition rules.--
                            (i) Staggered terms.--Of the directors 
                        first appointed under paragraph (2)(B)--
                                    (I) one shall hold office for a 
                                term expiring on December 31 of the 
                                first full calendar year after passage 
                                of this Act;
                                    (II) two shall hold office for a 
                                term expiring on December 31 of the 
                                second full calendar year after passage 
                                of this Act;
                                    (III) one shall hold office for a 
                                term expiring on December 31 of the 
                                third full calendar year after passage 
                                of this Act; and
                                    (IV) two shall hold office for a 
                                term expiring on December 31 of the 
                                fourth full calendar year after passage 
                                of this Act.
                            (ii) Timing of particular director's 
                        term.--
                                    (I) Industry appointees' terms will 
                                end in different years.--One of the 
                                directors appointed under each of the 
                                clauses (i)(I), (II), (III), (IV) shall 
                                consist of the 4 directors appointed 
                                under paragraphs (2)(B)(i), (ii), and 
                                (iii).
                                    (II) Appointees from the general 
                                public.--One director appointed under 
                                both clause (i)(II) and (IV) shall 
                                consist of one of the 2 directors 
                                appointed under paragraph (2)(B)(iv).
                            (iii) Treasury director must be appointed 
                        soon after enactment.--The Secretary of 
                        Treasury shall appoint the director designated 
                        under paragraph (2)(A) within 30 days after 
                        enactment of this Act.
                    (C) Vacancies.--
                            (i) Appointment in same manner.--A vacancy 
                        on the Board of Directors shall be filled in 
                        the same manner as the original appointment was 
                        made.
                            (ii) Appointment only for the remainder of 
                        the term.--Any director appointed under clause 
                        (i) shall be appointed only for the remainder 
                        of the term of his predecessor.
                    (D) Remaining a director until a successor is 
                appointed.--A director may serve after the expiration 
                of his term until his successor has taken office.
            (5) Compensation.--
                    (A) Chairman and vice chairman.--The compensation 
                of the Chairman and Vice Chairman shall be as provided 
                in the bylaws of the Corporation.
                    (B) Other directors.--The remaining five directors 
                shall serve without compensation except that they are 
                entitled to receive reimbursement for expenses incurred 
                in connection with official business of the 
                Corporation.
            (6) Officer and employees as members of the board of 
        directors.--
                    (A) In general.--Subject to Subparagraph (B), no 
                officer, attorney, employee, or agent of the 
                Corporation shall be a member of the Board of 
                Directors.
                    (B) Transition rule.--The chief executive officer 
                of the Corporation may be 1 of the public members of 
                the Board of Directors until 5 years after the cross-
                guarantee activation date.
            (7) Board of directors to determine officers.--The officers 
        of the Corporation shall be employed at the will of the Board 
        of Directors.
            (8) Definition of officer.--For purposes of this 
        subsection, the term ``officer'' includes any chief executive 
        officer, president, senior executive, or other official with 
        managerial or executive authority within the Corporation.
    (d) Meetings of the Board of Directors.--
            (1) Timing of meetings.--The Board of Directors shall meet 
        at the call of its Chairman, or as otherwise provided by the 
        bylaws of the Corporation, except that the director appointed 
        under subsection (c)(2)(A) may by himself call a meeting until 
        at least three other directors have taken office.
            (2) Quorum transition rule.--The bylaws shall determine how 
        many members constitute a quorum when the Board of Directors 
        meet, except that the director appointed under subsection 
        (c)(2)(A) shall by himself constitute a quorum until at least 
        three other directors have taken office.
    (e) Bylaws and Rulemaking.--
            (1) Bylaws.--
                    (A) Procedure.--The Board of Directors shall file 
                with the Secretary of the Treasury a copy of the 
                proposed initial bylaws of the Corporation and any 
                proposed bylaw changes accompanied by a concise general 
                statement of the basis and purpose for such changes.
                    (B) Changes become effective unless the treasury 
                department objects.--Any bylaws submissions under 
                subparagraph (A) shall become effective 30 days after 
                the filing of such changes with the Secretary of the 
                Treasury, unless--
                            (i) the Secretary of the Treasury, by 
                        notice to the Corporation setting forth the 
                        reasons therefor, disapproves of such proposed 
                        bylaw changes as being contrary to the purposes 
                        of this title; or
                            (ii) the Secretary of the Treasury decides, 
                        at its own discretion, that public comment 
                        shall be obtained, in which case it may, after 
                        notifying the Corporation in writing of such 
                        finding, require that the procedures set forth 
                        in paragraph (2) be followed with respect to 
                        such a bylaw change.
            (2) Rulemaking.--
                    (A) Rulemaking authority.--The Corporation shall 
                have the power to issue a rule only if--
                            (i) the power to issue the rule is 
                        explicitly provided for in this title; or
                            (ii) the Corporation demonstrates that--
                                    (I) the rule implements statutory 
                                language in this title; and
                                    (II) improves the efficiency of the 
                                cross-guarantee system.
                    (B) Substantive basis for rules.--Any proposed rule 
                or proposed rule change shall be approved only if there 
                is substantial evidence supporting the findings on 
                which the proposed rule is based.
                    (C) Rulemaking procedures.--
                            (i) In general.--The Corporation shall use 
                        the informal rulemaking procedures under the 
                        Administrative Procedures Act (5 U.S.C. 553) in 
                        prescribing rules under this paragraph.
                            (ii) Right to a hearing.--In addition to 
                        the procedures under clause (i), any person may 
                        during the comment period request a hearing and 
                        such hearing, if requested, shall take place 
                        within 30 days after the end of the comment 
                        period.
                            (iii) Submitting rules to treasury.--After 
                        having completed the procedures under clauses 
                        (i) and (ii), the Corporation shall file with 
                        the Secretary of the Treasury a copy of the 
                        proposed rules.
                            (iv) Treasury authority to reject rules.--
                        Any proposed rules submitted under clause (iii) 
                        shall become effective 30 days after the filing 
                        of such changes with the Secretary of the 
                        Treasury, unless the Secretary of the Treasury, 
                        by notice to the Corporation setting forth the 
                        reasons therefor, disapproves of such proposed 
                        rule changes as being contrary to the purposes 
                        of this title.
                    (D) Judicial review.--
                            (i) Standing.--Any person suffering a legal 
                        wrong, or adversely affected or aggrieved 
                        within the meaning of this title, by the rules 
                        issued under this paragraph is entitled to 
                        judicial review thereof.
                            (ii) Jurisdiction.--The United States Court 
                        of Appeals for the District of Columbia shall 
                        have exclusive original jurisdiction over any 
                        action under clause (i).
                    (E) Initial deadline.--For any rule covered by 
                subparagraph (A)(i), the Corporation shall issue a 
                final rule within 1 year after passage of this Act.
    (f) Funding.--
            (1) Initial borrowing.--
                    (A) BIF and saif financing.--The Corporation shall 
                have the power to borrow $20,000,000 from the Bank 
                Insurance Fund and Savings Association Insurance Fund, 
                in the manner described under section 144(d).
                    (B) Use of such financing.--The Corporation shall 
                use any amount borrowed under subparagraph (A) to 
                establish the central electronic repository, pay 
                initial salaries and other operating expenses, buy 
                equipment, develop computer software, and otherwise 
                begin operations.
                    (C) Repayment.--The Corporation shall repay any 
                borrowing under subparagraph (A) within 5 years after 
                the cross-guarantee activation date from income 
                obtained under paragraph (2).
                    (D) Interest on loan.--
                            (i) Timing of payments.--No principal or 
                        interest payments on the loan described in 
                        subparagraph (A) shall be due prior to 1 year 
                        after the cross-guarantee activation date.
                            (ii) Interest rate.--The interest rate on 
                        the borrowing under this paragraph shall be 
                        equal to .25 percent plus the average annual 
                        percentage yield on 3-month bills issued by the 
                        Secretary of the Treasury under section 3104(a) 
                        of title 31, United States Code.
            (2) Financing from operations.--
                    (A) Self-supporting.--The Corporation shall repay 
                the loan under paragraph (1) and pay for its ongoing 
                operating expenses by assessing fees as authorized 
                under subparagraph (B) and collecting penalties as 
                authorized under this title and shall not, subject to 
                paragraph (1), receive any financing or operating 
                subsidies from the United States Treasury.
                    (B) Fees.--The Corporation may assess a reasonable 
                fee upon any party which--
                            (i) submits a cross-guarantee, stop-loss, 
                        or group cross-guarantee syndicate contract for 
                        approval;
                            (ii) requests use of any service provided 
                        by the central electronic repository; or
                            (iii) requests a certification under 
                        section 124(b).
    (g) Miscellaneous Provisions.--
            (1) Inspection of reports.--
                    (A) In general.--Any notice, report, or other 
                document filed with the Corporation pursuant to this 
                title, other than financial statements filed by 
                nondepository guarantors pursuant to section 
                117(a)(3)(A), shall be available for public inspection 
                unless the Corporation or the Secretary of Treasury 
                determines that disclosure thereof is not in the public 
                interest.
                    (B) Congressional access.--Nothing under 
                subparagraph (A) shall act to deny documents or 
                information to the Congress of the United States or to 
                the committees of either House having jurisdiction over 
                depository institutions and related matters under the 
                rules of each body.
                    (C) Treasury access to the corporation's 
                documents.--The Corporation shall provide the Secretary 
                of Treasury with any document or information which the 
                Secretary in his or her discretion requests.
            (2) Liability of corporation and its officers.--Neither the 
        Corporation nor any of its directors, officers, attorneys, 
        agents, or employees shall have any liability to any person for 
        any action taken or omitted in good faith under or in 
        connection with any matter contemplated by this title.
            (3) Exemption from taxation.--The Corporation, its 
        property, its franchise, capital, reserves, surplus, and its 
        income, shall be exempt from all taxation now or hereafter 
        imposed by the United States or by any State or local taxing 
        authority, except that any real property or tangible personal 
        property (other than cash and securities) of the Corporation 
        shall be subject to State and local taxation to the same extent 
        according to its value as other real and tangible personal 
        property is taxed.
            (4) Fiscal year.--The fiscal year of the Corporation shall 
        be the calendar year.

SEC. 122. REGULATION OF THE CROSS-GUARANTEE PROCESS.

    (a) Cross-Guarantee Regulation Corporation Enforcement Authority.--
            (1) In general.--Subject to section 126, the Corporation 
        shall have exclusive authority to enforce compliance with 
        provisions of this title.
            (2) Enforcement.--The Corporation shall have the powers 
        provided in subsections (b), (c), (d), (h), (l), and (n) of 
        section 8 of the Federal Deposit Insurance Act and paragraph 
        (1) and each subparagraph, other than subparagraphs (B) and 
        (C), of paragraph (2) of subsection (i) of such section in 
        enforcing this title with respect to any syndicate agent and to 
        any direct guarantor, but only with respect to any violation of 
        any requirements under this title.
    (b) Limitation on State Jurisdiction.--
            (1) In general.--Notwithstanding any provision of state 
        law, no State may exercise authority over any party to any 
        cross-guarantee or stop-loss contract with respect to--
                    (A) whether such party may be a party to a cross-
                guarantee or stop-loss contract; and
                    (B) the rights, duties, privileges, or obligations 
                of such party under the contract or pursuant to this 
                title.
            (2) Rule of construction.--Paragraph (1) shall not be 
        construed as affecting the authority of any State to determine 
        the powers and regulate the activities of State depository 
        institutions.

SEC. 123. APPROVAL PROCESS FOR CROSS-GUARANTEE AND STOP-LOSS CONTRACTS.

    (a) Expedited Approval of Contracts and Contract Amendments.--
            (1) Notice and review requirement.--Except as provided in 
        paragraph (3), no cross-guarantee, stop-loss, or group cross-
        guarantee syndicate contract, and no amendment to any such 
        contract, may take effect unless--
                    (A) the Corporation has been given 15 business days 
                to review the contract or amendment; and
                    (B) before the end of the 15-day period described 
                in subparagraph (A), the Corporation has not issued an 
                order--
                            (i) disapproving the contract or amendment, 
                        or
                            (ii) extending the period within which the 
                        Corporation may disapprove the contract or 
                        amendment in accordance with paragraph (6).
            (2) Submission of contract or amendment in electronic 
        form.--The Corporation shall prescribe regulations requiring 
        that any cross-guarantee, stop-loss, or group cross-guarantee 
        syndicate contract, and any amendment to such contract, being 
        submitted for review under this subsection shall be submitted 
        in electronic form to the central electronic repository.
            (3) Notice of approval before end of disapproval period.--A 
        cross-guarantee, stop-loss, or group cross-guarantee syndicate 
        contract, and any amendment to any such contract, may take 
        effect before the expiration of the period described in 
        paragraph (1)(A) (or extended in accordance with paragraph (6)) 
        for disapproving such contract if the Corporation notifies the 
        parties that the Corporation does not intend to disapprove the 
        contract.
            (4) Submission of information and certifications.--
                    (A) In general.--The syndicate agent under any 
                proposed cross-guarantee, stop-loss, or group cross-
                guarantee syndicate contract, or any amendment to any 
                such contract, submitted to the Corporation for review 
                under paragraph (1), shall also submit to the 
                Corporation with such proposed contract such 
                information and attestations or certifications as the 
                Corporation may require by regulation.
                    (B) Limitation on scope of information required.--
                The regulations prescribed by the Corporation under 
                subparagraph (A) may not require the submission of any 
                information other than information directly necessary 
                for the Corporation to determine whether any proposed 
                cross-guarantee, stop-loss, or group cross-guarantee 
                syndicate contract, or amendment thereto, submitted to 
                the Corporation for approval is in compliance with the 
                requirements of this title.
            (5) Additional information.--
                    (A) In general.--The Corporation may, by specific 
                request in connection with a particular proposed cross-
                guarantee, stop-loss, or group cross-guarantee 
                syndicate contract, or amendment to any contract, 
                submitted to the Corporation, require, on 1 occasion 
                only, that additional information be submitted with 
                respect to such contract or amendment, except that the 
                Corporation may require only such information as may be 
                relevant to--
                            (i) a determination of the extent to which 
                        the proposed contract is in compliance with the 
                        requirements of this title; and
                            (ii) the Corporation's evaluation of the 
                        contract in accordance with this section.
                    (B) Written notice of explanation.--For any request 
                for additional information under subparagraph (A), the 
                Corporation shall provide a detailed explanation of the 
                specific reasons why such additional information is 
                needed.
            (6) Extension of disapproval period.--If, in connection 
        with a particular proposed cross-guarantee, stop-loss, or group 
        cross-guarantee syndicate contract, or any amendment to any 
        such contract, which is submitted to the Corporation, the 
        Corporation requests additional information under paragraph 
        (5), the Corporation may by order provide that the Corporation 
        shall have any additional period (not to exceed 5 business days 
        beginning on the date on which the Corporation receives such 
        information) within which to disapprove the proposed contract.
    (b) Limited Grounds for Disapproval of Proposed Contract or 
Amendment.--The Corporation may disapprove any proposed cross-
guarantee, stop-loss or group cross-guarantee syndicate contract, or 
any amendment to any such contract, if and only if--
            (1) the contract, including any party under the contract, 
        fails to meet the requirements of this title; or
            (2) the information submitted under subsection (a) was 
        insufficient to determine whether the contract and the parties 
        to the contract are in compliance with this title.
    (c) Written Notice of Disapproval.--
            (1) In general.--If the Corporation disapproves any cross-
        guarantee, stop-loss, or group cross-guarantee syndicate 
        contract, or any amendment thereto, the Corporation shall 
        provide immediate written notice to the parties to such 
        contract of any disapproval at the time of disapproval.
            (2) Statement of reason for disapproval.--The written 
        notice under paragraph (1) shall contain a detailed explanation 
        of the specific reasons for the disapproval under this section.
    (d) Conditional Approvals.--
            (1) In general.--The Corporation shall prescribe 
        regulations which would allow a cross-guarantee, stop-loss, or 
        group cross-guarantee syndicate contract to be conditionally 
        approved, in a manner otherwise in accordance with this 
        section, before the effective date of the contract if, at the 
        time such conditional approval is granted, all the information 
        which is required for the Corporation to make a final 
        determination of whether the contract meets the requirements of 
        this title cannot be known or ascertained.
            (2) Reconfirmation.--The regulations prescribed under 
        paragraph (1) shall allow the Corporation, upon receipt of all 
        the information the Corporation needs to determine whether the 
        contract meets the requirements of this title, 3 business days 
        to give the contract a final approval.
            (3) Replacement of guarantors.--The regulations prescribed 
        under paragraph (1) shall allow, without restriction, the 
        replacement of a direct guarantor with another direct guarantor 
        during the period between the date of conditional approval and 
        final approval.
    (e) Judicial Review.--
            (1) Contracts disapproved.--
                    (A) In general.--Any party to a contract 
                disapproved under this section may seek judicial review 
                of the disapproval of a contract under this section.
                    (B) Limitation on standing.--Only a party to a 
                contract disapproved under this section may bring an 
                action under this paragraph.
            (2) Contracts approved.--
                    (A) In general.--Subject to subparagraph (B), any 
                party to any cross-guarantee, stop-loss, or group 
                cross-guarantee syndicate contract may seek judicial 
                review of the approval of a contract under this 
                section.
                    (B) Limitation of review.--A contract approved 
                under this section may be reviewed only with respect to 
                whether the contract violates section 116(a) or section 
                125.
                    (C) Remedies.--
                            (i) In general.--Any court which under this 
                        paragraph holds that a contract violates 
                        section 116(a) or section 125 shall order the 
                        Corporation to use the remedies available under 
                        section 125 to eliminate the violation.
                            (ii) Injunctions disallowed.--No court may 
                        enjoin the operation of a contract approved 
                        under this section.
            (3) Jurisdiction.--No court other than a district court of 
        the United States shall have original jurisdiction of any 
        action under this subsection.

SEC. 124. CENTRAL ELECTRONIC REPOSITORY.

    (a) Establishment.--
            (1) CGRC establishes central electronic repository.--Before 
        the end of the 6-month period beginning on the date of the 
        enactment of this Act, the Corporation shall establish and 
        maintain a central electronic repository for cross-guarantee, 
        stop-loss, and group cross-guarantee syndicate contracts.
            (2) Maintenance of all past and current contracts.--The 
        central electronic repository shall maintain files, in 
        electronic form, of all cross-guarantee and stop-loss contracts 
        which have not been disapproved by the Corporation under 
        section 123, including expired and canceled contracts, all 
        amendments to any such contract which have not been disapproved 
        by the Corporation under such section, and all proposed 
        contracts and contract amendments which have been filed with 
        the Corporation, but not yet acted upon.
            (3) Direct access for all guarantors, guaranteed parties, 
        and syndicate agents.--The files in the central electronic 
        repository established under this section shall be directly and 
        immediately accessible by electronic means to any direct 
        guarantor, guaranteed party, and syndicate agent, and any other 
        person who qualifies for access under procedures established by 
        the Corporation.
            (4) Legal evidence of the contract.--The provisions of any 
        cross-guarantee contract or stop-loss contract, including any 
        amendment to such contract, on file in the central electronic 
        repository shall--
                    (A) be irrebuttable evidence of the contract; and
                    (B) be superior evidence to all other forms or 
                versions of the contract.
    (b) Availability of Certified Copies.--
            (1) In general.--The central electronic repository shall 
        make available a copy of any cross-guarantee or stop-loss 
        contract on file in the repository, including any amendment to 
        any such contract and any proposed contract or proposed 
        amendment to any contract, to any person, any Government 
        officer, agency, or department, or any court upon request.
            (2) Certification of copies.--
                    (A) In general.--Each copy of a cross-guarantee or 
                stop-loss contract which is made available in 
                accordance with paragraph (1) shall contain a 
                certification by the central electronic repository that 
                such copy is true and correct.
                    (B) Prima facie evidence.--A copy of a cross-
                guarantee or stop-loss contract which is certified in 
                accordance with subparagraph (A) shall establish prima 
                facie the contract.
    (c) Maintenance of Data Base of Guarantors.--The central electronic 
repository shall maintain a data base containing the names of the 
direct guarantors under each cross-guarantee or stop-loss contract 
which has not expired or been canceled and such other information with 
regard to such contracts that will enable any person to determine 
whether or not any such contract, proposed contract, or proposed 
amendment to any contract, is in compliance with this title and 
regulations prescribed under this title.
    (d) Standard Contract Language.--The Corporation is hereby 
authorized to maintain in the central electronic repository and update 
as needed standard language for various provisions of cross-guarantee, 
stop-loss, and group cross-guarantee syndicate contracts that parties 
to these contracts may, at their sole discretion, incorporate by 
reference in contracts and contract amendments they submit to the 
Corporation for approval.

SEC. 125. RESTRICTIONS ON CLOSED LOOPS.

    (a) Prohibition of More Than 1 Unrelated Closed Loop.--At no time 
shall 2 or more closed loops exist unless at least one cross-guarantee 
or stop-loss contract is a contract in each closed loop that exists in 
the system.
    (b) CGRC Call-Back.--If, at any time, the requirements of 
subsection (a) are violated--
            (1) the Corporation shall immediately notify each 
        guaranteed party under each cross-guarantee and stop-loss 
        contract which is part of the closed loop which has the fewest 
        number of contracts that it must obtain a successor cross-
        guarantee or stop-loss contract; and
            (2) each guaranteed party under paragraph (1) shall have 10 
        business days upon notification to submit a successor contract 
        to the Corporation for approval.
    (c) CGRC Filing of a Bankruptcy Petition.--
            (1) Filing of a bankruptcy petition by the cgrc.--
                    (A) Appointment of cgrc as receiver.--The 
                Corporation shall appoint itself as receiver for a 
                guaranteed company if and only if the company has not 
                met the deadline to submit a contract for approval 
                under subsection (b).
                    (B) CGRC immediately files a bankruptcy petition.--
                Immediately upon appointing itself as receiver under 
                paragraph (1), the Corporation shall file a voluntary 
                petition under section 301 of title 11, United States 
                Code, on behalf of the guaranteed company for which the 
                Corporation appointed itself receiver.
            (2) Recovery from all depository institutions for losses 
        due to closed loops.--
                    (A) In general.--In the case of any guaranteed 
                company for which the Corporation files a bankruptcy 
                petition under paragraph (1)(B), all depository 
                institutions guaranteed under a cross-guarantee 
                contract shall be liable to cover any loss to the 
                bankruptcy estate arising out of the bankruptcy 
                trustee's duty to perform on all guaranteed obligations 
                of the guaranteed company.
                    (B) Liability proportional to an institution's 
                share of overall guaranteed obligations.--A guaranteed 
                depository institution or guaranteed banking office 
                shall be liable under subparagraph (A) in proportion to 
                such institution's or office's share of the deposits of 
                all depository institutions at the time of the filing 
                of the bankruptcy petition by the Corporation.
                    (C) CGRC authorization.--The Corporation is 
                authorized to, and shall, assess depository 
                institutions for any amounts owed under this paragraph.
    (d) Standing.--Any person can bring an action in a district court 
of the United States to force the Corporation to take action under this 
section.

SEC. 126. TREASURY OVERSIGHT OF THE CROSS-GUARANTEE REGULATION 
              CORPORATION

    (a) Enforcement of the Act.--In the event that the Corporation 
should fail to fulfill any of its duties under this title, the 
Secretary of Treasury may apply to the Federal district court for the 
District of Columbia for an order requiring the Corporation to 
discharge its obligations under this title and for such other relief as 
the court may deem necessary to carry out the purposes of this title.
    (b) Examinations and Reports.--
            (1) Examinations.--The Secretary of Treasury may make such 
        examinations and inspections of the Corporation and require the 
        Corporation to furnish it with such reports and records or 
        copies thereof as the Secretary may consider necessary or 
        appropriate to effectuate the purposes of this title.
            (2) Reports.--
                    (A) Annual report.--Within 90 days after the close 
                of each fiscal year of the Corporation, the Corporation 
                shall submit to the Treasury Department a written 
                report relative to the conduct of its business, and the 
                exercise of the other rights and powers granted by this 
                title, during such fiscal year.
                    (B) Information to be included in report.--The 
                report under subparagraph (A) shall include financial 
                statements setting forth the financial position of the 
                Corporation at the end of such fiscal year and the 
                results of its operations (including the source and 
                application of its funds) for such fiscal year.
                    (C) Required audit.--The financial statements 
                included under subparagraph (B) shall be examined by an 
                independent public accountant or firm of independent 
                public accountants, selected by the Corporation and 
                satisfactory to the Treasury Department, and shall be 
                accompanied by the report thereon of such accountant or 
                firm.
                    (D) Submission to the president and congress.--The 
                Secretary of Treasury shall submit the report under 
                subparagraph (A) to the President and Congress with 
                such comment thereon as the Secretary deems 
                appropriate.

               CHAPTER 2--PROTECTION OF INSURED DEPOSITS

SEC. 128. BACKUP INSURANCE ON DEPOSITS AT GUARANTEED DEPOSITORY 
              INSTITUTIONS.

    (a) Establishment of Cross-Guarantee Backup Fund.--
            (1) In general.--There is hereby established the cross-
        guarantee backup fund consisting of amounts deposited pursuant 
        to section 144 and subsection (c) of this section.
            (2) Administration of fund.--The cross-guarantee backup 
        fund shall be administered by the Corporation.
    (b) Backup Deposit Insurance.--
            (1) Fund liability.--Deposits in any guaranteed depository 
        institution shall be insured against loss, to the same extent 
        as deposits are insured against loss under section 11(a) of the 
        Federal Deposit Insurance Act (as in effect on the day before 
        the enactment of this Act), in the event that no adjustment 
        under section 113(a)(2)(F)(iii) will be sufficient to protect 
        all guaranteed obligations of all guaranteed companies against 
        loss.
            (2) Subordinated debt not treated as deposit.--No 
        subordinated debt of any guaranteed depository institution or 
        any guaranteed banking office may be treated as a deposit for 
        purposes of paragraph (1).
    (c) Use and Disposition of Fund.--
            (1) In general.--Amounts in the cross-guarantee backup fund 
        may be used only to meet obligations incurred under subsection 
        (b)(1).
            (2) Investments.--Amounts on deposit in the cross-guarantee 
        backup fund shall be invested in direct obligations of the 
        United States and interest thereon shall accumulate in the 
        fund.

                  Subtitle D--Miscellaneous Provisions

SEC. 131. INSTITUTIONS OFFERING UNINSURED DEPOSITS.

    The Corporation shall ensure that any company other than--
            (a) a depository institution;
            (b) a branch which is not an insured branch (as the term 
        ``insured branch'' is defined in section 3(s) of the Federal 
        Deposit Insurance Act);
            (c) an insured credit union or noninsured credit union (as 
        such terms are defined in section 101(7) of the Federal Credit 
        Union Act);
            (d) a broker or dealer registered under the Securities and 
        Exchange Act of 1934; or
            (e) an investment company registered under the Investment 
        Company Act of 1940, which accepts deposits or assumes 
        obligations which would be deposits if the institution were a 
        bank or savings association (as defined in section 3 of the 
        Federal Deposit Insurance Act) is accepting such deposits and 
        assuming such obligations in accordance with all applicable 
        Federal and State laws which relate to the licensing and 
        regulation of institutions which accept deposits or assume such 
        obligations.

SEC. 132. PREEMPTION OF STATE DEPOSITOR PREFERENCE LAWS.

    Notwithstanding any State law, the depositors of any guaranteed 
depository institution shall be general creditors for purposes of any 
bankruptcy proceeding under title 11.

SEC. 133. FEDERAL RESERVE LENDING.

    (a) No Collateral Required for Lending to Guaranteed Company.--The 
cross-guarantee contract shall be sufficient collateral for any loan to 
a guaranteed company by any Federal Reserve bank for purposes of any 
provision of Federal law, any regulation prescribed by the Board of 
Governors of the Federal Reserve System, or any requirement of any such 
bank.
    (b) Certification of No Loss.--Before February 1 of each calendar 
year beginning after the cross-guarantee activation date, the Board of 
Governors of the Federal Reserve System, shall submit a report to the 
Committee on Banking, Finance and Urban Affairs of the House of 
Representatives and the Committee on Banking, Housing, and Urban 
Affairs of the Senate containing--
            (1) a certification that--
                    (A) no loss was incurred by such Board or any 
                Federal Reserve Bank during the preceding calendar year 
                on any loan or other advance to any guaranteed company 
                during such year; and
                    (B) no loss is anticipated on any such loan or 
                advance which remains outstanding at the end of such 
                year; or
            (2) the amount of any such loss or anticipated loss.

SEC. 134. ADVERTISING BY GUARANTEED FINANCIAL GROUPS.

    (a) Advertising Deposit Guarantees.--
            (1) In general.--A guaranteed company or guaranteed banking 
        office may advertise that deposits and certain other 
        liabilities are fully guaranteed against any loss under a 
        cross-guarantee contract approved by the Corporation.
            (2) Cross-guarantee logo.--Before the end of the 1-year 
        period beginning on the date of the enactment of this Act, the 
        Corporation shall--
                    (A) design, after consultation with depository 
                institutions, a logotype for use by a guaranteed 
                company or guaranteed banking office to indicate that 
                such a company or office is guaranteed under a cross-
                guarantee contract; and
                    (B) authorize guaranteed companies and guaranteed 
                banking offices to use such logotype.
            (3) Regulations governing manner of advertising.--The 
        Corporation shall prescribe regulations governing the manner in 
        which a guaranteed company or guaranteed banking office may 
        display any logotype permitted under this subsection.
    (b) Advertising Backup Insurance.--A depository institution which 
is guaranteed under a cross-guarantee contract shall--
            (1) display at each place of business of the institution 
        any sign described in section 18(a) of the Federal Deposit 
        Insurance Act; and
            (2) advertise that deposits at the institution are insured 
        by the Federal Government to $100,000.

SEC. 135. GUARANTEED DEPOSITORY INSTITUTIONS REMAIN FEDERALLY INSURED 
              DEPOSITORIES FOR PURPOSES OF STATE LAW.

    Unless a State otherwise provides subsequent to the passage of this 
Act, a guaranteed depository institution shall be deemed to be a 
federally-insured depository institution within the meaning of section 
3(c)(2) of the Federal Deposit Insurance Act for purposes of any State 
or Federal law or private agreement which determines the legally 
acceptable institutions with which to deposit funds.

     Subtitle E--Transition to 100 Percent Cross-Guarantee Process

SEC. 141. EFFECTIVE DATE OF SYSTEM BASED ON MINIMUM NUMBER OF 
              GUARANTEED DEPOSITORY INSTITUTIONS AND AMOUNT OF TOTAL 
              ASSETS.

    (a) In General.--No cross-guarantee or stop-loss contract shall 
take effect before the later of--
            (1) the end of the 18-month period beginning on the date of 
        the enactment of this Act; or
            (2) forty business days after the date on which the 
        Corporation has approved, under subsection (b), a minimum of 
        250 cross-guarantee contracts under which depository 
        institutions which, in the aggregate, have total assets of not 
        less than $500,000,000,000 are guaranteed companies or 
        guaranteed banking offices.
    (b) Contingent Effect of Contracts Until Effective Date.--
            (1) In general.--The Corporation may conditionally approve 
        a cross-guarantee or stop-loss contract to become effective on 
        the date to be determined under subsection (a) even through not 
        all direct guarantors under the contract meet the requirements 
        under section 116(a)(1).
            (2) Minimum requirements.--No cross-guarantee or stop-loss 
        contract conditionally approved under paragraph (1) shall 
        receive final approval from the Corporation for purposes of 
        subsection (a)(2) unless--
                    (A) the cross-guarantee or stop-loss contract is 1 
                of a set of contracts in which each contract--
                            (i) is a contract in the same closed loop; 
                        and
                            (ii) becomes effective at the same time 
                        every other contract within the set of 
                        contracts takes effect; and
                    (B) at the time such contract becomes effective, 
                the requirements of section 125(a) are met.
    (c) Publication of Subsection (a) Date.--The Corporation shall 
publish a notice in the Federal Register of the date by which contracts 
may take effect in accordance with subsection (a).
    (d) One-Time Conversion To Guaranteed Party Status.--
Notwithstanding any provision of section 142, section 111 shall apply 
with respect to any depository institution as of the date--
            (1) on which such institution first becomes a guaranteed 
        depository institution or guaranteed banking office;
            (2) on which any depository institution which is affiliated 
        with such depository institution becomes a guaranteed 
        depository institution; or
            (3) on which any depository institution which is under 
        common ownership with such depository institution under section 
        112(d)(2) becomes a guaranteed depository institution.

SEC. 142. MANDATORY PHASE-IN OF CROSS-GUARANTEES AFTER EFFECTIVE DATE 
              OF SYSTEM.

    (a) Depository Institutions With Assets of $1,000,000,000 or 
More.--Section 111 shall apply as of the end of the 2-year period 
beginning on the cross-guarantee activation date with respect to any 
depository institution which has consolidated assets at book value 
which are equal to or greater than $1,000,000,000 as of the end of such 
2-year period.
    (b) Depository Institutions With Assets of $500,000,000 or More.--
Section 111 shall apply as of the end of the 3-year period beginning on 
the cross-guarantee activation date with respect to any depository 
institution which has consolidated assets at book value which are equal 
to or greater than $500,000,000 as of the end of such 3-year period.
    (c) Depository Institutions With Assets of $250,000,000 or More.--
Section 111 shall apply as of the end of the 4-year period beginning on 
the cross-guarantee activation date with respect to any depository 
institution which has consolidated assets at book value which are equal 
to or greater than $250,000,000 as of the end of such 4-year period.
    (d) Depository Institutions With Assets of $100,000,000 or More.--
Section 111 shall apply as of the end of the 5-year period beginning on 
the cross-guarantee activation date with respect to any depository 
institution which has consolidated assets at book value which are equal 
to or greater than $100,000,000 as of the end of such 5-year period.
    (e) Depository Institutions With Assets of $50,000,000 or More.--
Section 111 shall apply as of the end of the 6-year period beginning on 
the cross-guarantee activation date with respect to any depository 
institution which has consolidated assets at book value which are equal 
to or greater than $50,000,000 as of the end of such 6-year period.
    (f) Depository Institutions With Assets of $25,000,000 or More.--
Section 111 shall apply as of the end of the 7-year period beginning on 
the cross-guarantee activation date with respect to any depository 
institution which has consolidated assets at book value which are equal 
to or greater than $25,000,000 as of the end of such 7-year period.
    (g) All Other Depository Institutions.--Section 111 shall apply as 
of the end of the 8-year period beginning on the cross-guarantee 
activation date with respect to any depository institution which is not 
described in subsection (a), (b), (c), (d), (e), or (f).
    (h) Consolidated Assets at Book Value Defined.--The term 
``consolidated assets at book value'' means the total value, as 
determined on a consolidated basis and in accordance with generally 
accepted accounting principles, of all tangible and intangible property 
of any depository institution, all subsidiaries of such institution, 
all affiliates of such institution which are depository institutions, 
and all subsidiaries of such affiliates.

SEC. 143. APPOINTMENT OF CONSERVATOR OR RECEIVER FOR INSTITUTIONS WHICH 
              FAIL TO COMPLY WITH TRANSITION REQUIREMENTS.

    The FDIC shall immediately appoint a conservator or receiver for 
any depository institution which is not a guaranteed depository 
institution or guaranteed banking office under any cross-guarantee 
contract as of the date by which such institution is required to be a 
guaranteed depository institution or guaranteed banking office under 
section 142.

SEC. 144. EXIT FEES.

    (a) Contingent Payment of Exit Fee Upon Conversion of Depository 
Institution to New System.--
            (1) Payment of exit fee.--Any insurance fund member which 
        becomes a guaranteed depository institution or guaranteed 
        banking office may be assessed an exit fee in an amount to be 
        determined and assessed under paragraph (2), and such fee shall 
        be deposited in the insurance fund of which the guaranteed 
        depository institution or guaranteed banking office was a 
        member on the cross-guarantee activation date.
            (2) Determination of amount of fee.--
                    (A) Total amount of exit fee to collect from 
                members of an insurance fund.--The FDIC shall calculate 
                for each insurance fund, as of the cross-guarantee 
                activation date, the total amount of exit fees it would 
                collect as of that date if all members of the insurance 
                fund, except those members the FDIC projects will have 
                to be liquidated, did become a guaranteed depository 
                institution or guaranteed banking office on such date.
                    (B) Calculation of total amount of exit fees.--For 
                the purpose of subparagraph (A), the total amount of 
                exit fees to be collected for each insurance fund shall 
                be the greater of zero or the present value of--
                            (i) the sum of--
                                    (I) total insured deposits of the 
                                members of an insurance fund on the 
                                cross-guarantee activation date (minus 
                                the insured deposits, on such date, 
                                held by insurance fund members which 
                                the FDIC estimates will be liquidated) 
                                multiplied by 0.2 percent;
                                    (II) losses incurred by an 
                                insurance fund for depository 
                                institutions placed into 
                                conservatorship or receivership after 
                                the cross-guarantee activation date;
                                    (III) administrative expenses of an 
                                insurance fund incurred after the 
                                cross-guarantee activation date; and
                                    (IV) transfers from an insurance 
                                fund to the FDIC severance fund; 
                                minus--
                            (ii) the sum of--
                                    (I) the balance in an insurance 
                                fund, as of the cross-guarantee 
                                activation date, after adding back any 
                                reserve for future losses as of such 
                                date, provided that the balance in the 
                                Savings Association Insurance Fund on 
                                that date shall be the greater of zero 
                                or the sum of all amounts assessed 
                                against Savings Association Insurance 
                                Fund members and interest earned during 
                                such period by such fund, minus the sum 
                                of losses paid or accrued for members 
                                of such fund placed into 
                                conservatorship or receivership and 
                                administrative expenses such fund 
                                incurs during such period; and
                                    (II) premiums earned by an 
                                insurance fund after the cross-
                                guarantee activation fund.
                    (C) Amount of exit fee paid by members of an 
                insurance fund.--Each insurance fund member, on the 
                date such member becomes a guaranteed depository 
                institution or guaranteed banking office, shall pay to 
                the insurance fund of which such member was a member on 
                the cross-guarantee activation date an amount equal to 
                the amount calculated in paragraph (B) multiplied by--
                            (i) The insured deposits of such member on 
                        the cross-guarantee activation date; divided by
                            (ii) The total amount of insured deposits 
                        of the members of such insurance fund on the 
                        cross-guarantee activation date, minus the 
                        insured deposits, as of such date, held by 
                        insurance fund members which the FDIC estimates 
                        as of that date will be liquidated.
                    (D) Interest rate paid on exit fees for contracts 
                that become effective after the cross-guarantee 
                activation date.--Any insurance fund member which pays 
                an exit fee shall also pay on the same day interest on 
                the exit fee for the period between the cross-guarantee 
                activation date and the date on which the exit fee is 
                paid.
            (3) Liability for exit fee.--Any acquirer of an insurance 
        fund member shall be liable for any exit fee due when such 
        acquirer becomes a guaranteed depository institution or 
        guaranteed banking office or, if the acquirer already is a 
        guaranteed depository institution or guaranteed banking office, 
        on the day the acquisition transaction officially is 
        consummated.
    (b) Original Funding of Cross-Guarantee Backup-Fund.--Upon payment 
of any exit fee due under paragraph (a)(1), the FDIC shall transfer 
from the insurance fund of which the depository institution was a 
member, as of the cross-guarantee activation date, to the cross-
guarantee backup fund an amount equal to 0.2 percent of the insured 
deposits of such institution as of the cross-guarantee activation date 
plus interest on the amount transferred.
    (c) Funding for FDIC Severance Fund.--When necessary, the FDIC 
shall transfer cash from each insurance fund to cover disbursements the 
FDIC makes from the FDIC severance fund, with the amount transferred 
from each fund bearing the same proportion as the insured deposits of 
such fund, as of the cross-guarantee activation date, bear to the total 
insured deposits of both funds as of that date.
    (d) Loans to the Corporation.--The FDIC shall extend loans from 
each of the insurance funds to the Corporation, as authorized under 
section 121(f)(1)(A), with the amount loaned by each fund bearing the 
same proportion as the insured deposits of such fund, as of the 
enactment date of this bill, bear to the total insured deposits of both 
funds as of that date.
    (e) Additional Assessments in Case of Shortfall in Insurance 
Funds.--
            (1) Annual reestimate.--As of the first eight anniversaries 
        of the cross-guarantee activation date, the FDIC shall 
        reestimate for each insurance fund the amounts calculated under 
        subsection (a)(2)(B).
            (2) Public comments and hearing.--The FDIC shall seek 
        public comments and hold at least one public hearing before 
        issuing its final judgment on any reestimate made under 
        paragraph (1).
            (3) Determination of additional assessment.--Within 60 days 
        after a reestimate under subsection (a)(2)(B), the FDIC shall 
        determine under subsection (a)(2)(C) for each member of an 
        insurance fund as of the cross-guarantee activation date which 
        still exists an amount equal to such member's percentage share 
        of the total insured deposits of all members of that insurance 
        fund as of such date which have not ceased to exist, multiplied 
        by the amount determined by the reestimate under subsection 
        (a)(2)(B) for the insurance fund of which such member was a 
        member.
            (4) No additional assessments when a fund is solvent.--If 
        any amount calculated under paragraph (3) is less than zero, 
        then the assessment under such paragraph shall be zero.
            (5) Collection of Additional Assessment.--If an insurance 
        fund member liable for an additional assessment under paragraph 
        (3) has become, as of the effective date of the reestimate, a 
        guaranteed depository institution or guaranteed banking office, 
        then such member shall pay the additional assessment to the 
        insurance fund to which it belonged on the cross-guarantee 
        activation date within 20 business days after being notified of 
        the additional assessment.
    (f) Assessment Procedure.--The FDIC shall prescribe, by regulation, 
procedures for assessing an exit fee under subsections (a) and (e).
    (g) Excess Amount in Insurance Funds Shall Be Transferred to the 
Cross-Guarantee Backup Fund.--On the eighth anniversary of the cross-
guarantee activation date and after first fully accruing for the 
present value of all losses and expenses associated with depository 
institutions to be placed in conservatorship or receivership after the 
eighth anniversary date, any balance remaining in each insurance fund 
shall be transferred to the cross-guarantee backup fund.
    (h) Calculation of Interest or Discount Rate.--For the purpose of 
this section, the rate of interest or the discount rate to be sued in a 
calculation for any insurance fund shall be the average daily 
percentage yield earned on the investments of each insurance fund for 
the period of time for which interest or a discounted value is being 
calculated.
    (i) Definitions.--For purposes of this section--
            (1) the term ``insurance fund'' means the Bank Insurance 
        Fund or the Savings Association Insurance Fund; and
            (2) the term ``insurance fund member'' means a depository 
        institution, the deposits of which were insured by an insurance 
        fund on the cross-guarantee activation date.

SEC. 145. SEVERANCE PAY AND RELATED BENEFITS FOR FORMER FEDERAL AND 
              STATE BANKING AGENCY EMPLOYEES.

    (a) Definitions.--For purposes of this section--
            (1) Eligible employee.--The term ``eligible employee'' 
        means any individual--
                    (A) who is employed by a Federal banking agency, a 
                State bank supervisor, or the Federal Financial 
                Institutions Examination Council (FFIEC) as of the date 
                of the enactment of this Act, including employees of 
                the FDIC on detail to the Resolution Trust Corporation; 
                and
                    (B) Whose employment is terminated by the agency or 
                supervisor after such date other than for cause.
            (2) Federal banking agency.--The term ``Federal banking 
        agency'' has the meaning given to such term in section 3(q) of 
        the Federal Deposit Insurance Act.
            (3) State bank supervisor.--The term ``state bank 
        supervisor'' means any officer, agency, or other entity of any 
        State (as defined in section 3(a)(3) of the Federal Deposit 
        Insurance Act) which has primary regulatory authority over 
        State banks or State savings associations (as such terms are 
        defined in section 3 of such Act) in such state.
    (b) Severance Pay.--
            (1) In general.--Subject to paragraph (3), any eligible 
        employee shall be entitled to receive in a lump sum, from the 
        FDIC severance fund at the time such employee's employment by a 
        Federal banking agency, state bank supervisor, or the FFIEC, is 
        terminated, severance pay in the amount which is equal to the 
        sum of--
                    (A) the amount equal to 2 months of compensation at 
                the employee's average annual rate of base pay for the 
                last 12 calendar months of the employee's employment by 
                any Federal banking agency or State bank supervisor; 
                plus
                    (B) the product of--
                            (i) the amount equal to 3 weeks of 
                        compensation at the employee's annual rate of 
                        base pay (as determined under subparagraph 
                        (A)); and
                            (ii) the number of years (including any 
                        fraction of a year) of full-time service of 
                        such employee with any Federal banking agency, 
                        State bank supervisor, or the FFIEC, or any 
                        predecessor of any such agency or supervisor, 
                        where such number of years can include 
                        employment for more than 1 such agency or 
                        supervisor and need not be continuous 
                        employment.
            (2) Exception for employees reemployed by another federal 
        or state agency.--Paragraph (1) shall not apply with respect to 
        any eligible employee who--
                    (A) in the case of an individual who is an eligible 
                employee by virtue of being separated from service with 
                any Federal agency, transfers to or becomes employed by 
                another Federal department, agency, or Government 
                corporation; or
                    (B) in the case of an individual who is an eligible 
                employee by virtue of being separated from service with 
                a State bank supervisor, transfers to or becomes 
                employed by another department, agency, or 
                instrumentality of such State.
            (3) Prohibition of certain government service after 
        accepting severance pay.--
                    (A) Federal employee.--No individual who receives 
                severance pay under this subsection by virtue of being 
                separated from service with a Federal agency or State 
                bank supervisor may be employed by any Federal officer, 
                department, agency, or Government corporation during 
                the 5-year period beginning on the date such severance 
                pay is received by such individual.
                    (B) State employee.--No individual who is, but for 
                this subparagraph, entitled to receive severance pay 
                under this subsection by virtue of being separated from 
                service with a State bank supervisor may receive such 
                pay unless such individual has entered into a contract 
                with the FDIC under which such individual, in 
                consideration of the payment of such severance pay, is 
                obligated to return such amount in full, plus interest, 
                to the FDIC if such employee is employed by any 
                officer, department, or agency of that State during the 
                5-year period beginning on the date such severance pay 
                is received by such individual.
            (4) Purchase of additional retirement benefits.--An 
        eligible employee may use any portion of the severance pay to 
        which the employee is entitled under this subsection to 
        purchase additional benefits or make additional investments in 
        any Federal retirement plan in which the employee is or was 
        entitled to participate as an employee before becoming an 
        eligible employee.
    (c) Relocation expenses and health benefits.--
            (1) Relocation expenses.--An eligible employee who obtains 
        employment away from the place such employee was employed by an 
        appropriate Federal agency or State banking supervisor shall be 
        entitled to receive travel, relocation, and moving expenses 
        from the FDIC severance fund to the same extent Federal 
        employees who are transferred or reemployed are authorized to 
        receive such expenses under subchapter II of chapter 57 of 
        title 5, United States Code.
            (2) Health benefits.--
                    (A) In general.--An eligible employee shall be 
                entitled to receive the same health benefits as such 
                employee received as of the date of termination for a 
                time period which shall consist of the shorter of--
                            (i) eighteen months following the date of 
                        termination of employment; or
                            (ii) until such employee obtains 
                        alternative full-time employment.
                    (B) Administration of the provision of health 
                benefits.--The agency which terminated the employment 
                of the eligible employee shall be responsible for 
                administering the provision of health benefits 
                authorized under subparagraph (A), unless such agency 
                has been abolished in which case the Federal or State 
                government (whichever case is appropriate) shall 
                provide for another agency or government entity to 
                perform this function.
                    (C) Severance fund compensation.--The FDIC 
                severance fund shall reimburse any agency or government 
                entity for the costs of providing the benefits 
                authorized under subparagraph (A).
    (d) Funding Benefits for Eligible Employees.--
            (1) Establishment of fdic severance fund.--There is hereby 
        established the FDIC severance fund which shall be administered 
        by the FDIC.
            (2) Related expenses.--Expenses incurred by the FDIC in 
        administering the FDIC severance fund shall be paid from the 
        fund.

SEC. 146. ABOLITION OF FEDERAL FINANCIAL INSTITUTIONS EXAMINATION 
              COUNCIL.

    The Federal Financial Institutions Examination Council is hereby 
abolished, effective on the date on which section 142(g) shall become 
effective.

SEC. 147. ABOLITION OF THE FEDERAL DEPOSIT INSURANCE CORPORATION.

    The FDIC is hereby abolished, effective on the date on which the 
last receivership or conservatorship resulting from the appointment of 
a receiver or conservator by the FDIC has been liquidated, disposed, 
of, or otherwise resolved.

               TITLE II--AMENDMENTS TO OTHER BANKING LAWS

SEC. 201. AMENDMENTS RELATING TO NATIONAL BANKS.

    (a) Exemptions From Minimum Capital, Stock, and Other Requirements 
Covered by Cross-Guarantee Contracts.--
            (1) Capital of national banks.--Section 5138 of the Revised 
        Statutes of the United States (12 U.S.C. 51) is amended by 
        adding at the end the following new sentence: ``This section 
        shall not apply with respect to any national bank which is a 
        guaranteed depository institution (as defined in section 
        101(a)(7) of the Deposit Insurance Reform, Regulatory 
        Modernization, and Taxpayer Protection Act of 1993).''.
            (2) Preferred stock in member banks.--Section 345 of the 
        Banking Act of 1935 (12 U.S.C. 51B-1) is amended by adding at 
        the end the following new sentence: ``This section shall not 
        apply with respect to any bank which is a guaranteed depository 
        institution (as defined in section 101(a)(7) of the Deposit 
        Insurance Reform, Regulatory Modernization, and Taxpayer 
        Protection Act of 1993).''.
            (3) Deficient capital provision for national banks.--
        Section 5205 of the Revised Statutes of the United States (12 
        U.S.C. 55) is amended by adding at the end the following new 
        sentence: ``This section shall not apply with respect to any 
        national bank which is a guaranteed depository institution (as 
        defined in section 101(a)(7) of the Deposit Insurance Reform, 
        Regulatory Modernization, and Taxpayer Protection Act of 
        1993).''.
            (4) Withdrawal of capital provision for national banks.--
        Section 5204 of the Revised Statutes of the United States (12 
        U.S.C. 56) is amended by adding at the end the following new 
        sentence: ``This section shall not apply with respect to any 
        national bank which is a guaranteed depository institution (as 
        defined in section 101(a)(7) of the Deposit Insurance Reform, 
        Regulatory Modernization, and Taxpayer Protection Act of 
        1993).''.
            (5) Increase in capital provision for national banks.--
        Section 5142 of the Revised Statutes of the United States (12 
        U.S.C. 57) is amended by adding at the end the following new 
        sentence: ``This section shall not apply with respect to any 
        national bank which is a guaranteed depository institution (as 
        defined in section 101(a)(7) of the Deposit Insurance Reform, 
        Regulatory Modernization, and Taxpayer Protection Act of 
        1993).''.
            (6) Decrease and distribution of capital provision for 
        national banks.--Section 5143 of the Revised Statutes of the 
        United States (12 U.S.C. 59) is amended by adding at the end 
        the following new sentence: ``Notwithstanding the preceding 
        sentence, the approval of the Comptroller of the Currency shall 
        not be required for any reduction of capital stock, or any 
        distribution to shareholders by reason of any such reduction, 
        under such sentence by any national bank which is a guaranteed 
        depository institution (as defined in section 101(a)(7) of the 
        Deposit Insurance Reform, Regulatory Modernization, and 
        Taxpayer Protection Act of 1993).''.
            (7) Dividend provisions.--
                    (A) In general.--Section 5199(a) of the Revised 
                Statutes of the United States (12 U.S.C. 60(a)) is 
                amended--
                            (i) by striking ``(a) The directors'' and 
                        inserting:
    ``(a) Declaration of Dividend.--
            ``(1) In general.--Subject to paragraph (2), the 
        directors'';
                            (ii) by striking ``expedient; except that 
                        until the surplus fund of such association'' 
                        and inserting ``expedient''.
            ``(2) Exception for certain under- capitalized 
        associations.--Until the surplus fund of a national bank'';
                        and
                            (iii) by adding at the end of paragraph (2) 
                        (as so redesignated by clause (ii) of this 
                        subparagraph) the following: ``This paragraph 
                        shall not apply with respect to any national 
                        bank which is a guaranteed depository 
                        institution (as defined in section 101(a)(7) of 
                        the Deposit Insurance Reform, Regulatory 
                        Modernization, and Taxpayer Protection Act of 
                        1993).''.
                    (B) Technical and conforming amendment.--Section 
                5199(b) of the Revised Statutes of the United States 
                (12 U.S.C. 60(b)) is amended--
                            (i) by striking ``(b) The approval of the 
                        Comptroller'' and inserting:
    ``(b) Approval of the Comptroller.--Except in the case of a 
national bank which is a guaranteed depository institution (as defined 
in section 101(a)(7) of the Deposit Insurance Reform, Regulatory 
Modernization, and Taxpayer Protection Act of 1993), the approval of 
the Comptroller''; and
                            (ii) by striking ``such association'' and 
                        inserting ``a national bank''.
    (b) Exemptions From Requirements Relating to Directors of Banks.--
            (1) Qualifications of national bank directors.--Section 
        5146 of the Revised Statutes of the United States (12 U.S.C. 
        72) is amended by adding at the end the following new sentence: 
        ``This section shall not apply with respect to any national 
        bank which is a guaranteed depository institution (as defined 
        in section 101(a)(7) of the Deposit Insurance Reform, 
        Regulatory Modernization, and Taxpayer Protection Act of 
        1993).''.
            (2) Service of president of national bank as chairman of 
        the bank's board of directors.--Section 5150 of the Revised 
        Statutes of the United States (12 U.S.C. 76) is amended by 
        adding at the end the following new sentence: ``This section 
        shall not apply with respect to any national bank which is a 
        guaranteed depository institution (as defined in section 
        101(a)(7) of the Deposit Insurance Reform, Regulatory 
        Modernization, and Taxpayer Protection Act of 1993).''.
            (3) Member bank director interlocks with securities 
        firms.--Section 32 of the Banking Act of 1933 (12 U.S.C. 78) is 
        amended by adding at the end the following new sentence: ``This 
        section shall not apply with respect to any member bank which 
        is a guaranteed depository institution (as defined in section 
        101(a)(7) of the Deposit Insurance Reform, Regulatory 
        Modernization, and Taxpayer Protection Act of 1993).''.
            (4) Loans on or purchase of national bank's own stock.--
        Section 5201 of the Revised Statutes of the United States (12 
        U.S.C. 83) is amended by adding at the end the following new 
        sentence: ``This section shall not apply with respect to any 
        national bank which is a guaranteed depository institution (as 
        defined in section 101(a)(7) of the Deposit Insurance Reform, 
        Regulatory Modernization, and Taxpayer Protection Act of 
        1993).''.
    (c) Exemption From Requirement Relating to Loans to 1 Borrower.--
Section 5200 of the Revised Statutes of the United States (12 U.S.C. 
84) is amended by adding at the end the following new subsection:
    ``(e) Exemption of Guaranteed Companies.--This section shall not 
apply with respect to any national bank which is a guaranteed 
depository institution (as defined in section 101(a)(7) of the Deposit 
Insurance Reform, Regulatory Modernization, and Taxpayer Protection Act 
of 1993).''.
    (d) Exemption From Requirements Relating to Security for Deposits 
of Government Agencies at National Banks.--Section 5153 of the Revised 
Statutes of the United States (12 U.S.C. 90) is amended--
            (1) in the 1st undesignated paragraph, by striking ``All 
        national banking associations'' and inserting:
    ``(a) In General.--All national banks'';
            (2) in the 2d undesignated paragraph, by striking ``Any 
        national banking association'' and inserting:
    ``(b) Depository for State and Local Governments.--Any national 
bank'';
            (3) in the 3d undesignated paragraph, by striking ``Any 
        national banking association'' and inserting:
    ``(c) Depository for Indian Tribes.--Any national bank''; and
            (4) by adding at the end the following new subsection:
    ``(d) Exemption From Security and Collateral Requirements.--A 
national bank which is a guaranteed depository institution (as defined 
in section 101(a)(7) of the Deposit Insurance Reform, Regulatory 
Modernization, and Taxpayer Protection Act of 1993) shall not be 
required to give any security which is otherwise required under 
subsection (a), (b), or (c) for deposits with the bank under this 
section or for the performance of the bank as financial agent.''.
    (e) Exemption From Provision Relating to Transfers by National 
Banks in Contemplation of Insolvency.--Section 5242 of the Revised 
Statutes of the United States (12 U.S.C. 91) is amended by adding at 
the end the following new sentence: ``This section shall not apply with 
respect to any national bank which is a guaranteed depository 
institution (as defined in section 101(a)(7) of the Deposit Insurance 
Reform Regulatory Modernization, and Taxpayer Protection Act of 
1993.''.
    (f) Exemption From Requirements Relating to Reports of Condition.--
Section 5211 of the Revised Statutes of the United States (12 U.S.C. 
161) is amended by adding at the end the following new subsection:
    ``(d) Exemption of Guaranteed Companies.--This section shall not 
apply with respect to any national bank which is a guaranteed 
depository institution (as defined in section 101(a)(7) of the Deposit 
Insurance Reform, Regulatory Modernization, and Taxpayer Protection Act 
of 1993.''.
    (g) Consent of Guarantors Required for Voluntary Dissolution.--
            (1) In general.--Section 5220 of the Revised Statutes of 
        the United States (12 U.S.C. 181) is amended--
                    (A) in the 1st undesignated paragraph, by striking 
                ``Any association'' and inserting:
    ``(a) In General.--Any national bank'';
                    (B) in the 2d undesignated paragraph, by striking 
                ``The shareholders shall designate'' and inserting:
    ``(b) Liquidating Agent or Committee.--The shareholders shall 
designate''; and
                    (C) by adding at the end the following new 
                subsection:
    ``(c) Consent of Guarantors Required for Guaranteed Companies.--In 
the case of any national bank which is a guaranteed depository 
institution (as defined in section 101(a)(7) of the Deposit Insurance 
Reform, Regulatory Modernization, and Taxpayer Protection Act of 1993), 
the national bank may go into liquidation and be closed in accordance 
with subsection (a) only with the consent of the direct guarantors of 
such bank.''.
            (2) Notice to syndicate agent.--Section 5221 of the Revised 
        Statutes of the United States (12 U.S.C. 182) is amended by 
        inserting ``and, in the case of a national bank which is a 
        guaranteed depository institution (as defined in section 
        101(a)(7) of the Deposit Insurance Reform, Regulatory 
        Modernization, and Taxpayer Protection Act of 1993), to the 
        syndicate agent of such bank'' after ``Comptroller of the 
        Currency''.
    (h) Comptroller of the Currency Not Authorized To Appoint 
Receiver.--
            (1) In general.--The Act entitled ``An Act authorizing the 
        appointment of receivers of national banking associations, and 
        for other purposes.'' and approved June 30, 1876, is amended by 
        inserting after the 1st section (12 U.S.C. 191) the following 
        new section:

``SEC. 2. EXEMPTION OF GUARANTEED NATIONAL BANKS.

    ``This Act shall not apply with respect to any national bank which 
is a guaranteed depository institution (as defined in section 101(a)(7) 
of the Deposit Insurance Reform, Regulatory Modernization, and Taxpayer 
Protection Act of 1993).''.
            (2) Exemption from additional ground for the appointment of 
        receivers.--Section 5234 of the Revised Statutes (12 U.S.C. 
        192) is amended by adding at the end the following new 
        sentence: ``This sentence shall not apply with respect to any 
        national bank which is a guaranteed depository institution (as 
        defined in section 101(a)(7) of the Deposit Insurance Reform, 
        Regulatory Modernization, and Taxpayer Protection Act of 
        1993).''.
    (i) Comptroller of the Currency Not Authorized To Appoint 
Conservator.--The Bank Conservation Act is amended by inserting after 
section 206 the following new section:

``SEC. 207. EXEMPTION OF GUARANTEED NATIONAL BANKS.

    ``This subchapter shall not apply with respect to any national bank 
which is a guaranteed depository institution (as defined in section 
101(a)(7) of the Deposit Insurance Reform, Regulatory Modernization, 
and Taxpayer Protection Act of 1993).''.
    (j) Comptroller of the Currency Not Authorized To Examine 
Guaranteed Banks.--Section 5240 of the Revised Statutes of the United 
States (12 U.S.C. 481-485) is amended by adding at the end of the 1st 
paragraph of such section the following new sentence: ``Notwithstanding 
any other provision of this section, the authority of the Comptroller 
of the Currency to examine any national bank or any affiliate of a 
national bank shall not apply with respect to any national bank which 
is a guaranteed depository institution (as defined in section 101(a)(7) 
of the Deposit Insurance Reform, Regulatory Modernization, and Taxpayer 
Protection Act of 1993) or any affiliate of such bank.''.
    (k) Exemption From Limitation or Conditions on Real Estate Lending 
Authority.--Section 24(a) of the Federal Reserve Act (12 U.S.C. 371(a)) 
is amended by adding at the end the following new sentence: 
``Notwithstanding the preceding sentence, a national bank which is a 
guaranteed depository institution (as defined in section 101(a)(7) of 
the Deposit Insurance Reform, Regulatory Modernization, and Taxpayer 
Protection Act of 1993) shall not be subject to section 18(o) of the 
Federal Deposit Insurance Act or any restriction or requirement 
prescribed by the Comptroller of the Currency under the preceding 
sentence.''.

SEC. 202. AMENDMENTS RELATING TO MEMBER BANKS.

    (a) Federal Reserve Board and Federal Reserve Banks Not Authorized 
To Examine Guaranteed Member Banks.--
            (1) In general.--Section 11(a)(1) of the Federal Reserve 
        Act (12 U.S.C. 248(a)(1)) is amended by adding at the end the 
        following new sentence: ``Notwithstanding any other provision 
        of this section, the authority of the Board or any Federal 
        Reserve bank to examine any member bank shall not apply with 
        respect to any member bank which is a guaranteed depository 
        institution (as defined in section 101(a)(7) of the Deposit 
        Insurance Reform, Regulatory Modernization, and Taxpayer 
        Protection Act of 1993).''.
            (2) Special examinations.--The 1st sentence of the 5th 
        undesignated paragraph of section 5240 of the Revised Statutes 
        of the United States (12 U.S.C. 483) is amended by inserting 
        ``which are not guaranteed depository institutions (as defined 
        in section 101(a)(7) of the Deposit Insurance Reform, 
        Regulatory Modernization, and Taxpayer Protection Act of 
        1993)'' after ``member banks within its district''.
            (3) Foreign operation of state member banks.--The last 
        sentence of the 6th undesignated paragraph of section 5240 of 
        the Revised Statutes of the United States (12 U.S.C. 481) is 
        amended by inserting ``and are not guaranteed depository 
        institutions (as defined in section 101(a)(7) of the Deposit 
        Insurance Reform, Regulatory Modernization, and Taxpayer 
        Protection Act of 1993)'' before the period.
            (4) Examinations in connection with advances or 
        discounts.--Section 11(n) of the Federal Reserve Act (12 U.S.C. 
        248(n)) is amended by striking ``depository institution,'' and 
        inserting ``depository institution (other than a guaranteed 
        depository institution (as defined in section 101(a)(7) of the 
        Deposit Insurance Reform, Regulatory Modernization, and 
        Taxpayer Protection Act of 1993)),''.
    (b) Exemption From Member Bank Loan Limitations.--Section 11(m) of 
the Federal Reserve Act (12 U.S.C. 248(m)) is amended by adding at the 
end the following new sentence: ``This paragraph shall not apply with 
respect to any member bank which is a guaranteed depository institution 
(as defined in section 101(a)(7) of the Deposit Insurance Reform, 
Regulatory Modernization, and Taxpayer Protection Act of 1993).''.
    (c) Exemption From Limitation On Access To Fed Wire.--Section 11 of 
the Federal Reserve Act (12 U.S.C. 248) is amended by inserting after 
paragraph (n) the following new paragraph:
    ``(o) Prohibition On Limits On Access To Payment and Clearing 
Systems By Guaranteed Member Banks.--Notwithstanding any other 
provision of law, the Board may not limit or deny access by any member 
bank which is a guaranteed depository institution (as defined in 
section 101(a)(7) of the Deposit Insurance Reform, Regulatory 
Modernization, and Taxpayer Protection Act of 1993) to the payment 
system or any system in effect for clearing transactions in securities 
for the purpose of protecting any such system from any risk.''.
    (d) Federal Reserve Board Not Authorized To Appoint Conservator or 
Receiver.--Section 11(p) of the Federal Reserve Act (12 U.S.C. 248(p)) 
(as added by section 133(f) of the Federal Deposit Insurance 
Corporation Act of 1991) is amended to read as follows:
    ``(p) Authority To Appoint Conservator or Receiver.--
            ``(1) In general.--Except as provided in subparagraph (B), 
        the Board may appoint the Federal Deposit Insurance Corporation 
        as conservator or receiver for a State member bank under 
        section 11(c)(8) of the Federal Deposit Insurance Act.
            ``(2) Exception for guaranteed depository institutions.--
        This paragraph shall not apply with respect to any member bank 
        which is a guaranteed depository institution (as defined in 
        section 101(a)(7) of the Deposit Insurance Reform, Regulatory 
        Modernization, and Taxpayer Protection Act of 1993).''.
    (e) Qualification of Guaranteed State Banks for Member Bank Status 
Without Application.--
            (1) In general.--The 1st undesignated paragraph of section 
        9 of the Federal Reserve Act (12 U.S.C. 321) is amended by 
        adding at the end the following new sentence: ``Notwithstanding 
        the application requirement contained in the 1st sentence of 
        this paragraph, any State bank which is a guaranteed depository 
        institution (as defined in section 101(a)(7) of the Deposit 
        Insurance Reform, Regulatory Modernization, and Taxpayer 
        Protection Act of 1993) may become a member of the Federal 
        Reserve System without application by agreeing to be subject to 
        all applicable provisions of this Act and by subscribing to 
        stock in the same manner and amount as a national bank under 
        section 2.''.
            (2) Exemption from capital, reserve, and reporting 
        requirements.--The 1st sentence of the 6th undesignated 
        paragraph of section 9 of the Federal Reserve Act (12 U.S.C. 
        324) is amended by inserting ``, other than a bank which is a 
        guaranteed depository institution (as defined in section 
        101(a)(7) of the Deposit Insurance Reform, Regulatory 
        Modernization, and Taxpayer Protection Act of 1993),'' after 
        ``banks admitted to membership under authority of this 
        section''.
            (3) Exemption from examination.--The 7th undesignated 
        paragraph of section 9 of the Federal Reserve Act (12 U.S.C. 
        325) is amended by striking ``such banks'' and inserting ``, 
        any bank admitted to membership under this section, other than 
        a bank which is a guaranteed depository institution (as defined 
        in section 101(a)(7) of the Deposit Insurance Reform, 
        Regulatory Modernization, and Taxpayer Protection Act of 
        1993),''.
            (4) Exemption from special examinations.--The 8th 
        undesignated paragraph of section 9 of the Federal Reserve Act 
        (12 U.S.C. 326) is amended by adding at the end the following 
        new sentence: ``Notwithstanding any other provision of this 
        paragraph, the authority of the Board to examine any member 
        bank shall not apply with respect to any member bank which is a 
        guaranteed depository institution (as defined in section 
        101(a)(7) of the Deposit Insurance Reform, Regulatory 
        Modernization, and Taxpayer Protection Act of 1993).''.
            (5) Exemption from certain forfeiture provision.--The 9th 
        undesignated paragraph of section 9 of the Federal Reserve Act 
        (12 U.S.C. 327) is amended by inserting ``, other than a bank 
        which is a guaranteed depository institution (as defined in 
        section 101(a)(7) of the Deposit Insurance Reform, Regulatory 
        Modernization, and Taxpayer Protection Act of 1993),'' after 
        ``a member bank''.
            (6) Exemption from additional capital requirement.--The 
        11th undesignated paragraph of section 9 of the Federal Reserve 
        Act (12 U.S.C. 329) is amended by adding at the end the 
        following new sentence: ``This paragraph shall not apply with 
        respect to any member bank which is a guaranteed depository 
        institution (as defined in section 101(a)(7) of the Deposit 
        Insurance Reform, Regulatory Modernization, and Taxpayer 
        Protection Act of 1993).''.
            (7) Exemption from security and collateral requirement.--
        The last sentence of the 15th undesignated paragraph of section 
        9 of the Federal Reserve Act (12 U.S.C. 332) is amended by 
        inserting ``, other than a bank which is a guaranteed 
        depository institution (as defined in section 101(a)(7) of the 
        Deposit Insurance Reform, Regulatory Modernization, and 
        Taxpayer Protection Act of 1993),'' after ``the banks and trust 
        companies thus designated''.
            (8) Membership qualification in the case of state mutual 
        savings banks.--The 16th undesignated paragraph of section 9 of 
        the Federal Reserve Act (12 U.S.C. 333) is amended by inserting 
        after the 1st sentence the following new sentence: 
        ``Notwithstanding the application requirement contained in the 
        preceding sentence, any State mutual savings bank which is a 
        guaranteed depository institution (as defined in section 
        101(a)(7) of the Deposit Insurance Reform, Regulatory 
        Modernization, and Taxpayer Protection Act of 1993) may become 
        a member of the Federal Reserve System without application by 
        agreeing to be subject to all applicable provisions of this Act 
        and by subscribing to stock in the same manner and amount as 
        provided in this paragraph for State mutual savings banks 
        applying for membership.''.
            (9) Exemption from affiliate reporting requirements.--
                    (A) In general.--The 1st sentence of the 17th 
                undesignated paragraph of section 9 of the Federal 
                Reserve Act (12 U.S.C. 334) is amended by inserting ``, 
                other than a bank which is a guaranteed depository 
                institution (as defined in section 101(a)(7) of the 
                Deposit Insurance Reform, Regulatory Modernization, and 
                Taxpayer Protection Act of 1993),'' after ``bank 
                admitted to membership under this section''.
                    (B) Exemption from additional affiliate reporting 
                requirements.--The 18th undesignated paragraph of 
                section 9 of the Federal Reserve Act (12 U.S.C. 334) is 
                amended by inserting ``, other than a bank which is a 
                guaranteed depository institution (as defined in 
                section 101(a)(7) of the Deposit Insurance Reform, 
                Regulatory Modernization, and Taxpayer Protection Act 
                of 1993),'' after ``affiliated member bank''.
            (10) Exemption from examination requirements.--The 22d 
        undesignated paragraph of section 9 of the Federal Reserve Act 
        (12 U.S.C. 338) is amended by inserting ``, other than a bank 
        which is a guaranteed depository institution (as defined in 
        section 101(a)(7) of the Deposit Insurance Reform, Regulatory 
        Modernization, and Taxpayer Protection Act of 1993),'' after 
        ``State member banks'' the 1st place such term appears.
    (f) Exemption From Interest Requirements.--Section 19(i) of the 
Federal Reserve Act (12 U.S.C. 371a) is amended by adding at the end 
the following new sentence: ``No provision of this subsection shall 
apply with respect to a member bank which is a guaranteed depository 
institution (as defined in section 101(a)(7) of the Deposit Insurance 
Reform, Regulatory Modernization, and Taxpayer Protection Act of 
1993).''.
    (g) Exemption From Requirements Relating to Interbank Liabilities 
and Transactions With Affiliates.--
            (1) Interbank liabilities.--Section 23 of the Federal 
        Reserve Act (12 U.S.C. 371(b-2)) is amended by adding at the 
        end the following new subsection:
    ``(f) Exemption for Guaranteed Depository Institutions.--A 
guaranteed depository institution (as defined in section 101(a)(7) of 
the Deposit Insurance Reform, Regulatory Modernization, and Taxpayer 
Protection Act of 1993) shall not be subject to any regulation or order 
issued under this section.''.
            (2) Exemption from restrictions on transactions with 
        affiliates.--Sections 23A and 23B of the Federal Reserve Act 
        (12 U.S.C. 371c, 371c-1) are each amended by adding at the end 
        of each such section the following new subsection:
    ``(f) Exemption for Guaranteed Depository Institutions.--This 
section shall not apply to any guaranteed depository institution (as 
defined in section 101(a)(7) of the Deposit Insurance Reform, 
Regulatory Modernization, and Taxpayer Protection Act of 1993) or any 
affiliate of any such institution that is a guaranteed company (as 
defined in section 101(a)(6) of the Deposit Insurance Reform, 
Regulatory Modernization, and Taxpayer Protection Act of 1993).''.
    (h) Exemption From Limitation On Investments In, or Loans On, Bank 
Premises.--Section 24A of the Federal Reserve Act (12 U.S.C. 371d) is 
amended by adding at the end the following new sentence: ``This section 
shall not apply to any guaranteed depository institution (as defined in 
section 101(a)(7) of the Deposit Insurance Reform, Regulatory 
Modernization, and Taxpayer Protection Act of 1993).''.
    (i) Exemption From Limitations On Bankers' Acceptances.--Section 
13(7) of the Federal Reserve Act (12 U.S.C. 372) is amended by adding 
at the end the following new subparagraph:
                    ``(I) Exemption from limitations for guaranteed 
                depository institutions.--Subparagraphs (B), (C), (D), 
                (E), (F), and (H) shall not apply to any guaranteed 
                depository institution (as defined in section 101(a)(7) 
                of the Deposit Insurance Reform, Regulatory 
                Modernization, and Taxpayer Protection Act of 1993).''.
    (j) Exemption From Purchasing and Lending Limits Relating To 
Directors and Officers.--Section 22 of the Federal Reserve Act (12 
U.S.C. 375, 376, 503, 375a, and 375b) is amended by inserting before 
subsection (d) the following new subsection:
    ``(c) Exemption For Guaranteed Depository Institutions.--
Subsections (d), (e), (g), and (h) shall not apply to any guaranteed 
depository institution (as defined in section 101(a)(7) of the Deposit 
Insurance Reform, Regulatory Modernization, and Taxpayer Protection Act 
of 1993) or any affiliate of any such institution.''.

SEC. 203. AMENDMENTS RELATING TO SAVINGS ASSOCIATIONS.

    (a) Guaranteed Savings Association Defined.--Section 2 of the Home 
Owners' Loan Act (12 U.S.C. 1462) is amended by adding at the end the 
following new paragraphs:
            ``(10) Guaranteed savings association.--The term 
        `guaranteed savings association' means a savings association 
        which is a guaranteed depository institution (as defined in 
        section 101(a)(7) of the Deposit Insurance Reform, Regulatory 
        Modernization, and Taxpayer Protection Act of 1993).
            ``(11) Guaranteed federal savings association.--The term 
        `guaranteed Federal savings association' means a Federal 
        savings association which is a guaranteed depository 
        institution (as defined in section 101(a)(7) of the Deposit 
        Insurance Reform, Regulatory Modernization, and Taxpayer 
        Protection Act of 1993).''.
    (b) Exemption From Examination and Regulation By Director of the 
Office of Thrift Supervision.--
            (1) In general.--Section 4(a) of the Home Owners' Loan Act 
        (12 U.S.C. 1463(a)) is amended by adding at the end the 
        following new paragraph:
            ``(4) Exemption for guaranteed savings associations.--The 
        authority of the Director under this subsection or subsection 
        (b) or (c) to examine any savings association or prescribe 
        regulations to savings associations shall not apply with 
        respect to any guaranteed savings association.''.
            (2) Federal savings associations.--Section 5(a) of the Home 
        Owners' Loan Act (12 U.S.C. 1464(a)) is amended by adding at 
        the end the following new sentence: ``The authority of the 
        Director under the preceding sentence to prescribe regulations 
        to provide for the examination and regulation of Federal 
        savings associations shall not apply with respect to the 
        examination or regulation of any guaranteed Federal savings 
        association.''.
            (3) Exemption from examination fee provisions.--Section 9 
        of the Home Owners' Loan Act (12 U.S.C. 1467) is amended by 
        adding at the end the following new subsection:
    ``(n) Exemption For Guaranteed Savings Associations.--This section 
and the authority of the Director under this section shall not apply 
with respect to any guaranteed savings association.''.
    (c) Exceptions To Limitations On Deposit and Related Powers.--
Section 5(b)(1) of the Home Owners' Loan Act (12 U.S.C. 1464(b)(1)) is 
amended by adding at the end the following new subparagraph:
                    ``(G) Special rules applicable to guaranteed 
                savings associations.--
                            ``(i) Statutory authority.--A guaranteed 
                        Federal savings association shall have the 
                        powers described in subparagraphs (C), (E), and 
                        (F) without regard to the condition or 
                        limitation contained in each such subparagraph 
                        relating to regulations of the Director.
                            ``(ii) Limitation on regulatory 
                        authority.--The exercise by a guaranteed 
                        Federal savings association of powers 
                        established under subparagraph (A) or (D) or 
                        the last sentence of subparagraph (B) shall not 
                        be subject to any regulations prescribed by the 
                        Director under such provision.
                            ``(iii) Exemption.--A guaranteed Federal 
                        savings association shall not be subject to the 
                        1st sentence of subparagraph (B).''.
    (d) Exceptions To Limitations On Loan and Investment Powers.--
Section 5(c) of the Home Owners' Loan Act (12 U.S.C. 1464(c)) is 
amended by adding at the end the following new paragraph:
            ``(7) Exceptions for guaranteed savings associations.--
                    ``(A) Limitation on regulatory authority.--The 
                exercise by a guaranteed Federal savings association of 
                powers established under any provision of this 
                subsection shall not be subject to any regulations 
                prescribed by the Director under this subsection.
                    ``(B) Exemption from maximum amount limitations.--A 
                guaranteed Federal savings association shall not be 
                subject to any limitation in this subsection on the 
                outstanding amount of loans or investments by the 
                association under any provision of this subsection, 
                without regard to whether such maximum amount is 
                expressed as a fixed dollar amount or as a percentage 
                of such association's assets or capital.''.
    (e) Exemption From Enforcement and Conservatorship and Receivership 
Provisions.--Section 5(d) of the Home Owners' Loans Act (12 U.S.C. 
1464(d)) is amended by adding at the end the following new paragraph:
            ``(7) Exemption for guaranteed savings associations.--This 
        subsection and the authority of the Director under this 
        subsection shall not apply with respect to any guaranteed 
        savings association.''.
    (f) Exemption From Fitness Standards.--Section 5(e) of the Home 
Owners' Loan Act (12 U.S.C. 1464(e)) is amended by adding at the end 
the following new sentence: ``The preceding sentence shall not apply 
with respect to any savings association which, at the time the charter 
is granted, is a guaranteed depository institution (as defined in 
section 101(a)(7) of the Deposit Insurance Reform, Regulatory 
Modernization, and Taxpayer Protection Act of 1993) or is required to 
be a guaranteed depository institution before such association accepts 
any deposit.''.
    (g) Exemption From Requirements Relating To Security For Deposits 
of Government Agencies.--Section 5(k) of the Home Owners' Loan Act (12 
U.S.C. 1464(k)) is amended by adding at the end the following new 
sentence: ``A guaranteed savings association shall not be required to 
give any security for deposits with the savings association under this 
section or for the performance of the association as fiscal agent.''.
    (h) Exemption From Minimum Capital Requirements.--Section 5(s) of 
the Home Owners' Loan Act (12 U.S.C. 1464(s)) is amended by adding at 
the end the following new paragraph:
            ``(6) Exemption for guaranteed savings associations.--This 
        subsection and the authority of the Director under this 
        subsection shall not apply with respect to any guaranteed 
        savings association.''.
    (i) Exemption From Capital Standards.--Section 5(t)(1) of the Home 
Owners' Loan Act (12 U.S.C. 1464(t)(1)) is amended by adding at the end 
the following new subparagraph:
                    ``(E) Exemption for guaranteed savings 
                associations.--This subsection and the authority of the 
                Director under this subsection shall not apply with 
                respect to any guaranteed savings association.''.
    (j) Exemption From Requirement Relating To Loans To 1 Borrower.--
Section 5(u) of the Home Owners' Loan Act (12 U.S.C. 1464(u)) is 
amended by adding at the end the following new paragraph:
            ``(4) Exemption for guaranteed savings associations.--This 
        subsection shall not apply with respect to any guaranteed 
        savings association.''.
    (k) Exemption From Requirement Relating To Reports of Condition.--
Section 5(v) of the Home Owners' Loan Act (12 U.S.C. 1464(v)) is 
amended by adding at the end the following new paragraph:
            ``(9) Exemption for guaranteed savings associations.--This 
        subsection shall not apply with respect to any guaranteed 
        savings association.''.
    (l) Exemption From Requirement Relating To Liquid Assets.--Section 
6 of the Home Owners' Loan Act (12 U.S.C. 1465) is amended by adding at 
the end the following new subsection:
    ``(g) Exemption For Guaranteed Savings Associations.--This section 
shall not apply with respect to any guaranteed savings associations.''.
    (m) Exemption From Affiliate Transaction and Lending Limits 
Relating To Directors and Officers.--Section 11 of the Home Owners' 
Loan Act (12 U.S.C. 1468) is amended by adding at the end the following 
new subsection:
    ``(d) Exemption For Guaranteed Savings Associations.--This section 
shall not apply with respect to any guaranteed savings association.''.

SEC. 204. AMENDMENTS RELATING TO SAVINGS AND LOAN HOLDING COMPANIES.

    (a) Guaranteed Savings Association Defined.--Section 10(a)(1) of 
the Home Owners' Loan Act (12 U.S.C. 1467a(a)(1)) is amended by adding 
at the end the following new subparagraph:
                    ``(K) Guaranteed savings association.--The term 
                `guaranteed savings association' includes any savings 
                association referred to in subparagraph (A) which is a 
                guaranteed depository institution (as defined in 
                section 101(a)(7) of the Deposit Insurance Reform, 
                Regulatory Modernization, and Taxpayer Protection Act 
                of 1993).''.
    (b) Exemption From Examination and Reporting Requirement.--Section 
10(b) of the Home Owners' Loan Act (12 U.S.C. 1467a(b)) is amended by 
adding at the end the following new paragraph:
            ``(7) Exemption for s&l holding company which controls a 
        guaranteed savings association.--Paragraphs (2), (3), and (4) 
        and the authority of the Director under any such paragraph 
        shall not apply with respect to any savings and loan holding 
        company which controls a guaranteed savings association and any 
        subsidiary of such company.''.
    (c) Coordination With Section 11.--Section 10(d) of the Home 
Owners' Loan Act (12 U.S.C. 1467a(d)) is amended by striking 
``Transaction'' and inserting ``Subject to section 11(d), 
transactions''.
    (d) Exemption From Requirements Relating To Declaration of 
Dividend.--Section 10(f) of the Home Owner's Loan Act (12 U.S.C. 
1467a(f)) is amended by adding at the end the following new sentence: 
``This subsection shall not apply with respect to any savings and loan 
company which controls a guaranteed savings association.''.
    (e) Exemption From Restrictions On High-Risk Activities.--Section 
10(p) of the Home Owners' Loan Act (12 U.S.C. 1467a(p)) is amended by 
adding at the end the following new paragraph:
            ``(3) Exemption for parent of guaranteed savings 
        association.--This subsection shall not apply with respect to 
        any savings and loan company which controls a guaranteed 
        savings association.''.
    (f) Nonapplicability of Qualified Stock Issuance Provisions.--
Section 10(q)(1)(A) of the Home Owners' Loan Act (12 U.S.C. 
1467a(q)(1)(A)) is amended--
            (1) in clause (i), by inserting ``which is not a guaranteed 
        savings association'' after ``undercapitalized savings 
        association''; and
            (2) in clause (ii), by inserting ``and does not control a 
        guaranteed savings association'' after ``controls an 
        undercapitalized savings association''.

SEC. 205. AMENDMENTS RELATING TO THE FEDERAL DEPOSIT INSURANCE 
              CORPORATION.

    (a) Amendments To Definitions.--
            (1) Definitions relating to depository institutions.--
        Section 3(c) of the Federal Deposit Insurance Act (12 U.S.C. 
        1813(c)) is amended by adding at the end the following new 
        paragraphs:
            ``(6) Guaranteed depository institution not included.--
        Except as otherwise specifically provided in any provision of 
        this Act, the terms `depository institution' and `insured 
        depository institution' do not include any guaranteed 
        depository institution.
            ``(7) Guaranteed depository institution.--The term 
        `guaranteed depository institution' has the meaning given to 
        such term in section 101(a)(7) of the Deposit Insurance Reform, 
        Regulatory Modernization, and Taxpayer Protection Act of 
        1993.''.
            (2) Definition relating to banks.--Section 3(a) of the 
        Federal Deposit Insurance Act (12 U.S.C. 1813(a)) is amended by 
        adding at the end the following new paragraph:
            ``(5) Guaranteed depository institutions not included.--
        Except as otherwise specifically provided in any provision of 
        this Act, the terms `bank', `national bank', `State bank', 
        `District bank', `branch', and `Federal branch', whether or not 
        any such term appears in conjunction with the term `insured', 
        `member', or `nonmember', do not include any guaranteed 
        depository institution.''.
            (3) Definition relating to savings associations.--Section 
        3(b) of the Federal Deposit Insurance Act (12 U.S.C. 1813(b)) 
        is amended by adding at the end the following new paragraph:
            ``(4) Guaranteed depository institutions not included.--
        Except as otherwise specifically provided in any provision of 
        this Act, the terms `savings association', `Federal savings 
        association', and `State savings association', whether or not 
        any such term appears in conjunction with the term `insured', 
        do not include any guaranteed depository institution.''.
            (4) Definition relating to appropriate federal banking 
        agency.--Section 3(q) of the Federal Deposit Insurance Act (12 
        U.S.C. 1813(q)) is amended by adding before the last sentence 
        the following new paragraph:
            ``(5) The Cross-Guarantee Regulation Corporation in the 
        case of a guaranteed depository institution.''.
    (b) Prohibition On New Insured Depository Institutions, By Charter 
or Conversion, After Effective Date of Cross-Guarantee System.--
            (1) No continuation of insurance in connection with 
        conversions.--Section 4 of the Federal Deposit Insurance Act 
        (12 U.S.C. 1814) is amended by adding at the end the following 
        new subsection:
    ``(e) Inapplicability of Subsections (b), (c), and (d) After 
Effective Date of Cross-Guarantee System.--Subsections (b), (c), and 
(d) shall not apply as of the effective date of the cross-guarantee 
system under subsection (a) of section 141 of the Deposit Insurance 
Reform, Regulatory Modernization, and Taxpayer Protection Act of 1993, 
as published by the Cross-Guarantee Regulation Corporation in the 
Federal Register pursuant to subsection (c) of such section.''.
            (2) No new insurance under the federal deposit insurance 
        act.--Section 5 of the Federal Deposit Insurance Act (12 U.S.C. 
        1815) is amended by adding at the end the following new 
        subsection:
    ``(f) Prohibition on Approval of Insurance After Effective Date of 
Cross-Guarantee System.--No application for insurance under this 
section may be approved by the Corporation on or after the date by 
which the Cross-Guarantee Regulation Corporation has approved, under 
subsection (a) of section 141 of the Deposit Insurance Reform, 
Regulatory Modernization, and Taxpayer Protection Act of 1993, 250 
cross-guarantee contracts described in subsection (a)(2) of such 
section.''.
    (c) Termination of Deposit Insurance of Guaranteed Depository 
Institution.--Section 8(a) of the Federal Deposit Insurance Act (12 
U.S.C. 1818(a)) is amended--
            (1) by redesignating paragraph (10) as paragraph (11); and
            (2) by inserting after paragraph (9), the following new 
        paragraph:
            ``(10) Termination of insurance of guaranteed depository 
        institution.--The status of any insured depository institution 
        as an insured depository institution shall cease as of the date 
        the institution becomes a guaranteed depository institution.''.
    (d) Ineligibility of Guaranteed Depository Institution for Deposit 
Insurance Under the Federal Deposit Insurance Act.--Section 5(a)(1) of 
the Federal Deposit Insurance Act (12 U.S.C. 1815(a)(1)) is amended by 
striking ``trust funds (as defined in section 3(p)),'' and inserting 
``trust funds (as defined in section 3(p)) and is not a guaranteed 
depository institution.''.
    (e) Applicability of Insurance Logo Provisions.--Section 18(a) of 
the Federal Deposit Insurance Act (12 U.S.C. 1828(a)) is amended by 
adding at the end the following new paragraph:
            ``(4) Applicability to guaranteed institutions.--For 
        purposes of this subsection, the terms `insured bank' and 
        `insured savings association' shall be deemed to include any 
        bank (as defined in section 3(a) without regard to paragraph 
        (5) of such section) and any savings association (as defined in 
        section 3(b) without regard to paragraph (4) of such section) 
        which is a guaranteed depository institution.''.
    (f) Guaranteed Depository Institutions Not Exempt From Limitation 
on Insurance Underwriting.--Section 24(b) of the Federal Deposit 
Insurance Act (12 U.S.C. 1831a(b)) is amended by adding at the end the 
following new paragraph:
            ``(3) Applicability to guaranteed depository 
        institutions.--Notwithstanding section 3(a)(5), the term 
        `insured State bank' includes, for purposes of this subsection, 
        a State bank which is a guaranteed depository institution.''.

SEC. 206. AMENDMENTS TO OTHER BANKING LAWS.

    (a) Exemption From Depository Institution Management Interlocks 
Act.--Section 205 of the Depository Institution Management Interlocks 
Act (12 U.S.C. 3204) is amended by adding at the end the following new 
paragraph:
            ``(10) Guaranteed depository institution.--Any guaranteed 
        depository institution and any affiliate of such 
        institution.''.
    (b) Exemption From Real Estate Appraisal Requirements.--Section 
1121(4) of the Financial Institutions Reform, Recovery, and Enforcement 
Act of 1989 (12 U.S.C. 3350(4)) is amended to read as follows:
            ``(4) Federally related transaction.--The term `Federally 
        related transaction'--
                    ``(A) means any real estate-related financial 
                transaction which--
                            ``(i) a Federal financial institutions 
                        regulatory agency or the Resolution Trust 
                        Corporation engages in, contracts for, or 
                        regulates; and
                            ``(ii) requires the services of an 
                        appraiser; and
                    ``(B) does not include any real estate-related 
                financial transaction which is regulated by a Federal 
                financial institutions regulatory agency solely by 
                reason of the involvement of a guaranteed depository 
                institution (as defined in section 101(a)(7) of the 
                Deposit Insurance Reform, Regulatory Modernization, and 
                Taxpayer Protection Act of 1993) in such 
                transaction.''.
    (c) Exemption From Payment System Requirements.--Subtitle A of 
Title IV of the Federal Deposit Insurance Corporation Improvement Act 
of 1991 (12 U.S.C. 4401 et seq.) is amended by adding at the end the 
following new section:

``SEC. 408. EXEMPTION FROM GUARANTEED DEPOSITORY INSTITUTIONS.

    ``This subtitle shall not apply with respect to a depository 
institution which is a guaranteed depository institution (as defined in 
section 101(a)(7) of the Deposit Insurance Reform, Regulatory 
Modernization, and Taxpayer Protection Act of 1993).''.
    (d) Exemption From the International Lending Supervision Act of 
1983.--The last sentence of section 903(2) of the International Lending 
Supervision Act of 1983 (12 U.S.C. 3902(2)) is amended by inserting 
``or a guaranteed depository institution (as defined in section 
101(a)(7) of the Deposit Insurance Reform, Regulatory Modernization, 
and Taxpayer Protection Act of 1993)'' before the period.

         TITLE III--AMENDMENTS TO TITLE 11, UNITED STATES CODE

            Subtitle A--Amendments to Chapter 1 of Title 11

SEC. 301. DEFINITIONS.

    Section 101 of Title 11, United States Code, is amended--
            (a) by redesignating subsection (3) as subsection ``(29)'';
            (b) by redesignating subsections (4)-(7) as subsections 
        ``(3)''-``(6)'';
            (c) by adding new subsection (7):
            ``(7) `company' means any corporation, partnership, 
        business trust, association, or similar organization;'';
            (d) by adding new subsection (11):
            ``(11) `cross-guarantee contract' means a contract which--
                    ``(A) is entered into between--
                            ``(i) one or more companies, at least one 
                        of which is a depository institution; and
                            ``(ii) a cross-guarantee syndicate; and
                    ``(B) is approved by the regulation corporation 
                under section 123 of title I of this Act;'';
            (e) by adding new subsection (12):
            ``(12) `cross-guarantee obligation' means an obligation of 
        a direct guarantor arising out of a cross-guarantee or stop-
        loss contract, and shall include the obligations of such direct 
        guarantor under section 125(c)(2) of title I of this Act and 
        sections 321 and 355 of this title;'';
            (f) by adding new subsection (13):
            ``(13) `cross-guarantee premium payment' means the payment 
        a guaranteed company periodically makes to the guaranteed 
        company's direct guarantors under the terms of a cross-
        guarantee contract;'';
            (g) by adding new subsection (14):
            ``(14) `cross-guarantee syndicate' means any group of 
        direct guarantors which has entered into a cross-guarantee 
        contract with one or more guaranteed companies;'';
            (h) by redesignating subsections (11), (12) and (13) as 
        subsection ``(15)'', ``(16)'', and ``(17)'';
            (i) by adding new subsection (18):
            ``(18) `depository institution' has the meaning given to 
        such term in section 3(c)(1) of the Federal Deposit Insurance 
        Act (12 U.S.C. 1813(c)(1)), however, for the purposes of this 
        title, depository institution shall not mean a Federal branch 
        or an insured branch as those terms are defined in Sections 
        (3)(r) and (3)(s) of the Federal Deposit Insurance Act (12 
        U.S.C. 1813(4) and (s));'';
            (j) by adding new subsection (19):
            ``(19) `direct guarantor' means a member of a cross-
        guarantee or stop-loss syndicate which has entered into a 
        cross-guarantee or stop-loss contract with a guaranteed 
        party;'';
            (k) by redesignating subsections (14)-(21A) as subsections 
        ``(20)''-``(28)'' and by redesignating subsections (22)-(27) as 
        subsections ``(30)''-``(35)'';
            (l) by adding new subsection (36):
            ``(36) `guaranteed company' means any company which has 
        entered into a cross-guarantee contract with a cross-guarantee 
        syndicate and has guaranteed obligations outstanding as of the 
        date of the filing of the petition;'';
            (m) by adding new subsection (37):
            ``(37) `guaranteed creditor' means any entity who owns or 
        is the beneficiary of a guaranteed obligation;'';
            (n) by adding new subsection (38):
            ``(38) `guaranteed obligation' means an obligation of a 
        guaranteed party on which a cross-guarantee or stop-loss 
        syndicate has guaranteed performance, including payment of 
        principal and interest at the promised time of payment, such 
        that failure to immediately perform in a timely manner 
        constitutes a breach of contract;'';
            (o) by adding new subsection (39):
            ``(39) `guaranteed party' means any guaranteed company or 
        nondepository guarantor;'';
            (p) by redesignating subsections (28)-(35) as subsections 
        ``(40)''-``(47)'' and subsection (36)-(38) as subsections 
        ``(49)''-``(51)'';
            (q) by adding new subsection (53):
            ``(53) `monitoring fee payment' means the periodic payment 
        made by a guaranteed party to a syndicate agent under the terms 
        of the guaranteed party's cross-guarantee or stop-loss 
        contract;'';
            (r) by adding new subsection (55):
            ``(55) `nondepository guarantor' means a guaranteed party 
        under a stop-loss contract;'';
            (s) by redesignating subsection (39) as subsection 
        ``(68)'';
            (t) by redesignating subsection (40) as subsection 
        ``(54)'';
            (u) by redesignating subsections (41)-(44) as subsections 
        ``(56)''-``(59)'';
            (v) by adding new subsection (60):
            ``(60) `regulation corporation' means the Cross-Guarantee 
        Regulation Corporation;'';
            (w) by redesignating subsections (45)-(51) as subsections 
        ``(61)''-``(67)'';
            (x) by redesignating subsections (52) and (53) as 
        subsections ``(69)'' and ``(70)''; subsection (54) as 
        subsection ``(79)'' and subsection (54)\1\ as subsection 
        ``(71)'';
            (y) by adding new subsection (72):
            ``(72) `stop-loss contract' means a contract which--
                    ``(A) is entered into between a person or a company 
                and a stop-loss syndicate; and
                    ``(B) is approved by the regulation corporation 
                under section 123 of title I of this Act,'';
            (z) by adding new subsection (73):
            ``(73) `stop-loss premium payment' means the payment a 
        nondepository guarantor periodically makes to direct guarantors 
        under the nondepository guarantor's stop-loss contract;'';
            (aa) by adding new subsection (74):
            ``(74) `stop-loss syndicate' means any group of direct 
        guarantors which has entered into a stop-loss contract with a 
        nondepository guarantor;'';
            (bb) by adding new subsection (77):
            ``(77) `syndicate agent' means any person or company who 
        acts as the agent for the direct guarantors under any cross-
        guarantee or stop-loss contract;''; and
            (cc) by redesignating subsection (55) as subsection 
        ``(80)'', subsection (55)\1\ as subsection ``(75)''; subsection 
        (56) as subsection ``(48)'', subsection (56)\1\ as subsection 
        ``(76)'' subsection (57) as subsection ``(52)'', and subsection 
        (57)\1\ as subsection ``(78)''.

SEC. 302. APPLICABILITY OF CHAPTERS.

    Section 103 of title 11, United States Code, is amended--
            (a) in subsection (a) by striking ``section 1161'' and 
        adding ``sections 1161 and 1181'';
            (b) by adding new subsection (h):
    ``(h) Subchapter V of chapter 11 of this title applies only in a 
case under such chapter in which a guaranteed company is the debtor''; 
and
            (c) by redesignating subsection (h) and (i) to (i) and (j).

SEC. 303. PUBLIC ACCESS TO PAPERS.

    Section 107 of title 11, United States Code, is amended--
            (a) in subsection (a) by striking ``subsection (b)'' and 
        inserting ``subsections (b) and (c)''; and
            (b) by adding new subsection (c):
    ``(c) Notwithstanding subsection (a) of this section, the identity 
of a guaranteed creditor and the amount of a guaranteed creditor's 
claim in a case under subchapter V of chapter 11 is not a matter of 
public record and shall be kept confidential.''.

SEC. 304. WHO MAY BE A DEBTOR.

    Section 109 of title 11, United States Code, is amended--
            (a) in subsection (b)(2) by adding at the end ``or a 
        guaranteed company'';
            (b) in subsection (d) by striking ``and a railroad'' and 
        inserting ``a railroad, and a guaranteed company''; and
            (c) by adding new subsection (h):
            ``(h) a guaranteed company may only be a debtor under 
        subchapter V of chapter 11.''.

            Subtitle B--Amendments to Chapter 3 of Title 11

SEC. 311. PARTY IN INTEREST.

    Title 11, United States Code, is amended by adding new section 308:
``Sec. 308. Party in interest
    ``(a) The regulation corporation shall be a party in interest in 
any action seeking to impair or limit the obligations or duties of the 
debtor or of a direct guarantor under a cross-guarantee or stop-loss 
contract.
    ``(b) A cross-guarantee or stop-loss syndicate shall be a party in 
interest in any determination of whether a claim is a guaranteed 
obligation under a cross-guarantee or stop-loss contract.
    ``(c) A cross-guarantee or stop-loss syndicate shall be a party in 
interest for the purpose of filing objections to the allowance of a 
claim or interest as provided under section 502(a) of this title.''.

SEC. 312. QUALIFICATION OF TRUSTEE.

    Section 322 of title 11, United States Code, is amended--
            (a) in subsection (a) by inserting ``1183,'' after 
        ``1163,''; and
            (b) by adding new subparagraph (b)(3):
    ``(3) In a case under subchapter V of chapter 11, the United States 
trustee shall consult with the syndicate agent monitoring the debtor as 
of the date of the filing of the petition and shall consider any 
existing bonds covering the guaranteed company when determining the 
amount of the bond required to be filed under subsection (a) of this 
section.''.

SEC. 313. NOTICE.

    Section 342 of title 11, United States Code, is amended by adding 
new subsection (c):
    ``(c) Notwithstanding subsection (a) of this section, notice of the 
entry of an order for relief in a case under subchapter V of Chapter 11 
shall be given by publication and shall be given in writing to the 
syndicate agent and to all creditors having claims that are not 
guaranteed obligations. Notice to the syndicate agent shall constitute 
notice to all guaranteed creditors in the case.''.

SEC. 314. AUTOMATIC STAY.

    Section 362 of title 11, United States Code, is amended by adding 
new subsection (b)(17):
            ``(17) under subsection (a) of this section, of the 
        exercise of any right of a guaranteed creditor under applicable 
        nonbankruptcy law to collect, enforce or recover a guaranteed 
        obligation from the debtor.''.

SEC. 315. EXECUTORY CONTRACTS AND UNEXPIRED LEASES.

    Section 365 of title 11, United States Code, is amended--
            (a) in subsection (a) by striking ``and (d)'' and inserting 
        ``(d), and (q)'';
            (b) in subsection (e)(1), by substituting for the existing 
        language--``Notwithstanding a provision in an executory 
        contract, guaranteed obligation, or unexpired lease, or in 
        applicable law, an executory contract, guaranteed obligation, 
        or unexpired lease of the debtor may not be terminated, 
        modified, or any liability thereunder accelerated, and any 
        right, obligation, or liability under such contract, guaranteed 
        obligation, or lease may not be terminated, modified, or 
        accelerated, at any time after the commencement of the case 
        solely because of a provision in such contract, guaranteed 
        obligation, or lease that is conditioned on--'';
            (c) in subparagraph (e)(2)(B), by striking ``such contract 
        is a'' and inserting ``such contract is not a guaranteed 
        obligation but is some other'';
            (d) by adding a new subsection (q):
    ``(q) Notwithstanding subsection (c)(2) of this section, the 
trustee shall be deemed to have assumed as of the date of filing of the 
petition all cross-guarantee and stop-loss contracts to which the 
debtor is a party. The trustee shall immediately pay all cross-
guarantee premium payments, stop-loss premium payments, and monitoring 
fee payments due under any cross-guarantee or stop-loss contract so 
assumed. Any claim for a subsequent breach of the obligations under 
such contracts shall be entitled to priority under section 507(a)(1). 
The trustee shall not reject any cross-guarantee or stop-loss 
contract''; and
            (e) in subsection (f)(1) by inserting after ``Except as 
        provided in subsection (c) of this section'' the following to 
        complete the clause, ``and excluding those executory contracts 
        described in subsection (q)''.

            Subtitle C--Amendments to Chapter 5 of Title 11

SEC. 321. CLAIMS OF DIRECT GUARANTORS.

    Title 11, United States Code, is amended by adding a new section 
511--
``Sec. 511. Claims of direct guarantors
    ``The direct guarantors of a debtor shall pay to the trustee the 
amount by which losses accrued by the estate as a direct guarantor 
since the date the petition was filed exceed the cross-guarantee and 
stop-loss premiums the estate has accrued since that date. Such payment 
shall be received by the trustee on the effective date of a plan 
confirmed under section 1129 of this title or, in the case of a 
liquidation under section 1186 of this title, at the time of the 
transfer to an unrelated party or the termination of all of the 
estate's guaranteed obligations. The amount paid by the direct 
guarantors in accordance with this subsection shall be subordinated to 
all other claims in the case for the purpose of distribution under this 
title.''.

SEC. 322. DEBTOR'S DUTIES.

    Section 521 of title 11, United States Code, is amended--
            (a) in subsection (1) by inserting ``(a)'' at the beginning 
        of the subsection; and
            (b) by adding new subparagraph (1)(b)--
            ``(b) in a case under subchapter V of chapter 11 and 
        subject to the requirement of subsection 107(c) of this title, 
        file under seal the list of guaranteed creditors and the amount 
        of the claims of guaranteed creditors.''.

SEC. 323. EXCEPTIONS TO DISCHARGE.

    Section 523 of title 11, United States Code, is amended by adding 
new subparagraph (a)(13):
            ``(13) which arises as a result of the debtor's cross-
        guarantee obligations.''.

SEC. 324. LIMITATION ON AVOIDING POWERS.

    Section 546 of title 11, United States Code, is amended by adding 
new subsection (h):
    ``(h) Notwithstanding sections 544, 545, 547 and 548(a)(2) of this 
title, the trustee may not avoid a transfer that is a cross-guarantee 
premium payment, a stop-loss premium payment, or a monitoring fee 
payment made before the commencement of the case, except under section 
548(a)(1) of this title.''.

SEC. 325. PREFERENCES.

    Section 547 of title 11, United States Code, is amended by adding 
new subsection (h):
    ``(h) For the purposes of this section, a payment of a guaranteed 
obligation is deemed to be a payment of a debt incurred by the debtor 
in the ordinary course of business or financial affairs of the debtor 
and the transferee.''.

SEC. 326. FRAUDULENT TRANSFERS AND OBLIGATIONS.

    Section 548 of title 11, United States Code, is amended in 
subsection (d)(2) by adding new subparagraph (E):
            ``(E) A cross-guarantee syndicate or a syndicate agent that 
        receives a cross-guarantee premium payment, a stop-loss premium 
        payment, or a monitoring fee payment takes for value to the 
        extent of such payment.''.

SEC. 327. POST-PETITION TRANSACTIONS.

    Section 549 of title 11, United States Code, is amended--
            (a) in subsection (a) by striking ``subsections (b) or 
        (c)'' and by inserting ``subsections (b), (c), or (d)'';
            (b) by adding new subsection (d):
    ``(d) The trustee may not avoid under subsection (a) of this 
section a transfer of property to a transferee whose claim, in the 
absence of such transfer, would be guaranteed under a cross-guarantee 
or stop-loss contract''; and
            (c) by redesignating subsection (d) as subsection (e).

SEC. 328. CONTRACTUAL RIGHT TO LIQUIDATE A SECURITIES CONTRACT.

    Section 555 of title 11, United States Code, is amended--
            (a) by inserting ``(a)'' at the beginning of the section; 
        and
            (b) by adding new subsection (b):
    ``(b) Subsection (a) of this section shall not apply in any case 
under subchapter V of chapter 11.''.

SEC. 329. CONTRACTUAL RIGHT TO LIQUIDATE A COMMODITIES CONTRACT OR 
              FORWARD CONTRACT.

    Section 556 of title 11, United States Code, is amended--
            (a) by inserting ``(a)'' at the beginning of the section; 
        and
            (b) by adding new subsection (b):
    ``(b) Subsection (a) of this section shall not apply in any case 
under subchapter V of chapter 11.''.

SEC. 330. CONTRACTUAL RIGHT TO LIQUIDATE A REPURCHASE AGREEMENT.

    Section 559 of title 11, United States Code, is amended--
            (a) by inserting ``(a)'' at the beginning of the section; 
        and
            (b) by adding new subsection (b):
    ``(b) Subsection (a) of this section shall not apply in any case 
under subchapter V of chapter 11.''.

SEC. 331. CONTRACTUAL RIGHT TO TERMINATE A SWAP AGREEMENT.

    Section 560 of title 11, United States Code, is amended--
            (a) by inserting ``(a)'' at the beginning of the section; 
        and
            (b) by adding new subsection (b):
    ``(b) Subsection (a) of this section shall not apply in any case 
under subchapter V of chapter 11.''.

            Subtitle D--Amendments to Chapter 11 of Title 11

                 CHAPTER 1--AMENDMENTS TO EXISTING LAW

SEC. 341. CREDITORS' AND EQUITY SECURITY HOLDERS' COMMITTEES.

    Section 1102 of title 11, United States Code, is amended by 
subsection (a)(1) by inserting at the end ``: Provided, however, That 
only creditors holding claims that are not guaranteed obligations under 
a cross-guarantee or stop-loss contract and are not direct guarantors 
may be appointed to such committee in a case under subchapter V of 
chapter 11''.

SEC. 342. WHO MAY FILE A PLAN.

    Section 1121 of title 11, United States Code, is amended--
            (a) by adding new subsection (d):
    ``(d) Notwithstanding subsection (c) of this section, a guaranteed 
creditor may not file a plan in a case under subchapter V of chapter 
11''; and
            (b) by redesignating subsection (d) as subsection (e).

SEC. 343. IMPAIRMENT OF CLAIMS OR INTERESTS.

    Section 1124 of title 11, United States Code, is amended--
            (a) by inserting ``(a)'' at the beginning of the section; 
        and
            (b) by adding new subsection (b):
    ``(b) Notwithstanding subsection (a) of this section, the claim of 
a guaranteed creditor is deemed to be unimpaired in a case under 
subchapter V of chapter 11.''.

SEC. 344. ACCEPTANCE OF PLAN.

    Section 1126 of title 11, United States Code, is amended in 
subsection (a) by inserting at the end of the first sentence``: 
Provided, however, That a guaranteed creditor is not entitled to accept 
or reject a plan in a case under subchapter V of chapter 11''.

SEC. 345. CONFIRMATION HEARING.

    Section 1128 of title 11, United States Code, is amended in 
subsection (b) by inserting after ``A party in interest'' ``, other 
than a guaranteed creditor in a case under subchapter V of chapter 
11,''.

SEC. 346. CONFIRMATION OF PLAN.

    Section 1129 of title 11, United States Code, is amended--
            (a) in subsection (a)(4), by inserting at the end ``: 
        Provided, however, That no such approval of any payment by a 
        cross-guarantee or stop-loss syndicate is required when the 
        cross-guarantee or stop-loss syndicate is the proponent of the 
        plan and the payment is made pursuant to a cross-guarantee or 
        stop-loss contract''; and
            (b) by adding new subsection (e):
    ``(e) Notwithstanding subsections (a) and (b) of this section, the 
court may confirm a plan that otherwise meets the requirements of 
subsection (a) and (b) of this section even though, in a case under 
subchapter V of chapter 11, a guaranteed creditor receives or retains 
no property under the plan.''.

SEC. 347. EFFECT OF CONFIRMATION.

    Section 1141 of title 11, United States Code, is amended--
            (a) in subsection (a) by striking ``(d)(2) and (d)(3)'' and 
        by inserting ``(d)(2), (d)(3), and (d)(4)'';
            (b) by inserting new subsection (d)(4):
  ``(4) Except as provided in section 365(k) of this title, the 
confirmation of a plan does not discharge a debtor of its obligations 
and liabilities as a direct guarantor under a cross-guarantee or stop-
loss contract''; and
            (c) by redesignating subsection (d)(4) as (d)(5).

                  CHAPTER 2--ENACTMENT OF SUBCHAPTER V

SEC. 351. GUARANTEED COMPANY REORGANIZATION.

    Title 11, United States Code, is amended by adding a new subchapter 
V--

          ``Subchapter V--Guaranteed Company Reorganization''.

SEC. 352. INAPPLICABILITY OF OTHER SECTIONS.

    Title 11, United States Code, is amended by adding new section 
1181--
``Sec. 1181. Inapplicability of other sections
    ``Sections 341, 343, 1104, 1105, and 1107 do not apply in a case 
under subchapter V of Chapter 11.''.

SEC. 353. EFFECTIVE DATE OF FILING.

    Title 11, United States Code, is amended by adding new section 
1182--
``Sec. 1182. Effective date of filing
    ``The effective date and time of the filing of a petition under 
this subchapter shall be the close of business on the business day 
preceding the date on which the petition is actually filed.''.

SEC. 354. APPOINTMENT OF TRUSTEE.

    Title 11, United States Code, is amended by adding new section 
1183:
``Sec. 1183. Appointment of trustee
    ``As soon as practicable after the entry to an order for relief, 
the regulation corporation shall submit to the United States Trustee a 
list of 5 disinterested persons who are qualified and willing to serve 
as the trustee in the case. The United States Trustee shall appoint one 
such person to serve as the trustee in the case. The syndicate agent 
monitoring the debtor as of the date of the filing of the petition 
shall not be eligible to serve as the trustee. The court, after notice 
and a hearing, may replace a trustee for cause.''.

SEC. 355. LIABILITY OF DIRECT GUARANTORS FOR TRANSFERS TO GUARANTEED 
              CREDITORS.

    Title 11, United States Code, is amended by adding new section 
1184--
``Sec. 1184. Liability of direct guarantors for transfers to guaranteed 
              creditors
    ``The trustee may recover for the benefit of the estate from the 
direct guarantors of the debtor the amount of any transfers of property 
of the estate to or for the benefit of guaranteed creditors that enable 
such creditors to receive more than such creditors would receive if the 
trustee was engaged in a liquidation pursuant to section 1186 of this 
chapter and such transfers had not been made.''.

SEC. 356. EFFECTIVE OF FEDERAL LEGISLATION AND FEDERAL, STATE, AND 
              LOCAL REGULATIONS.

    Title 11, United States Code, is amended by adding new section 
1185:
``Sec. 1185. Effect of Federal legislation and Federal, State, and 
              local regulations
    ``Except with respect to merger, modification of the financial 
structure of the debtor, or the issuance or sale of securities under a 
plan, the trustee and the debtor are subject to all Federal legislation 
and to all Federal, State, and local regulations and orders to the same 
extent as the debtor would be if a petition commencing the case under 
this chapter had not been filed.''.

SEC. 357. LIQUIDATION.

    Title 11, United States Code, is amended by adding new section 
1186:
``Sec. 1186. Liquidation
    ``On request of a party in interest and after notice and a hearing, 
the court may order the trustee to cease the debtor's operation and to 
collect and reduce to money all of the property of the estate in the 
same manner as if the case were a case under chapter 7 of this title if 
such liquidation is in the best interest of creditors.''.

          TITLE IV--AMENDMENT TO TITLE 28, UNITED STATES CODE

SEC. 401. VENUE.

    Title 28, United States Code, is amended by adding new subsection 
1409(f):
    ``(f) A proceeding arising in or related to a case under subchapter 
V of chapter 11 of title 11 regarding the debtor's satisfaction of a 
guaranteed obligation, whether arising before or after the commencement 
of the case, may be commenced in the district court for the district 
where the state of Federal court sits in which the party commencing 
such proceeding may, under applicable non-bankruptcy venue provisions, 
have brought an action on such claim, or in the district court in which 
such case is pending. The cross-guarantee syndicate which has entered 
into a cross-guarantee contract in such a case shall be a party in 
interest in any proceeding commenced under this subsection.''.

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