[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 459 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 459

            To provide for nationwide banking and branching.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 6, 1993

 Mr. Hoagland (for himself and Mr. McCollum) introduced the following 
bill; which was referred to the Committee on Banking, Finance and Urban 
                                Affairs

_______________________________________________________________________

                                 A BILL


 
            To provide for nationwide banking and branching.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Nationwide Banking and Branching Act 
of 1993''.

SEC. 2. NATIONWIDE BANKING.

    (a) Interstate Acquisitions.--Section 3(d) of the Bank Holding 
Company Act of 1956 (12 U.S.C. 1842(d)) is amended to read as follows:
    ``(d) Interstate Acquisitions.--
            ``(1) In general.--The Board may approve an application 
        under this section by a bank holding company or foreign bank to 
        acquire, directly or indirectly, any voting shares of, interest 
        in or all or substantially all of the assets of any additional 
        insured depository institution (as defined in section 3 of the 
        Federal Deposit Insurance Act) or bank holding company located 
        in any State.
            ``(2) State law.--Any acquisition described in paragraph 
        (1) that has been approved under this section may be 
        consummated notwithstanding any State law that would prohibit 
        or otherwise limit such acquisition on the basis of--
                    ``(A) the location or size of the acquiring 
                company, foreign bank, or subsidiary of such company or 
                foreign bank;
                    ``(B) the number of insured depository institution 
                subsidiaries of such company or foreign bank; or
                    ``(C) any other factor that, directly or indirectly 
                has the effect of prohibiting or limiting the 
                acquisition of shares or control of an insured 
                depository institution or bank holding company located 
                in that State by an out-of-State bank holding company 
                or foreign bank if such factor is not applied with 
                similar effect in the case of acquisitions of insured 
                depository institutions or bank holding companies 
                located in such State by bank holding companies located 
                in the State.''.
    (b) Effective Date.--The amendment made by this section shall take 
effect on the date of the enactment of this Act.

SEC. 3. INTERSTATE BRANCHING BY NATIONAL BANKS.

    Section 5155 of the Revised Statutes (12 U.S.C. 36) is amended--
            (1) by redesignating subsections (d) through (h) as 
        subsections (e) through (i), respectively; and
            (2) by inserting after subsection (c) the following:
    ``(d) Interstate Branching by National Banks.--
            ``(1) In general.--
                    ``(A) Approvals authorized.--Beginning 2 years 
                after the date of the enactment of the Nationwide 
                Banking and Branching Act of 1993, the Comptroller of 
                the Currency may approve an application under this 
                subsection which will permit a national bank to 
                establish or acquire, and operate, branches located 
                outside the State in which the main office of such bank 
                is located, subject to paragraphs (2), (3), and (5).
                    ``(B) Conditions.--In determining whether to grant 
                approval under subparagraph (A), the Comptroller of the 
                Currency shall consider the bank's rating under the 
                Community Reinvestment Act of 1977.
                    ``(C) Applicable law.--
                            ``(i) In general.--Except with regard to 
                        State tax laws, any branch established or 
                        acquired under subparagraph (A) shall be 
                        subject to the laws of the host State as if it 
                        were a branch of a national bank with its main 
                        office in that State.
                            ``(ii) Filing requirement.--A host State 
                        may require any national bank that has its main 
                        office in another State that wishes to 
                        establish a branch within the host State to 
                        comply with filing requirements that are not 
                        discriminatory in nature and that are similar 
                        in their effect to those that are imposed on a 
                        corporation from another State that is not 
                        engaged in the business of banking and that 
                        seeks to engage in business in the host State. 
                        The host State may preclude any national bank 
                        the main office of which is located in another 
                        State from establishing or operating a branch 
                        within the host State if that national bank 
                        materially fails to comply with the filing 
                        requirements.
            ``(2) State election to prohibit interstate branching.--
                    ``(A) In general.--The provisions of paragraph (1) 
                shall not apply to branches located or to be located in 
                a State which has enacted, during the period beginning 
                on the date of the enactment of this Act, and ending 2 
                years after the date of the enactment of this Act, a 
                law that applies equally to national and State banks 
                and that expressly prohibits all out-of-State banks 
                from establishing or acquiring branches located in that 
                State.
                    ``(B) Effect of prohibition.--A national bank that 
                has its main office in a State that has in effect a 
                prohibition under subparagraph (A) may not acquire or 
                establish a branch located in any other State under the 
                provisions of this subsection.
            ``(3) State election to permit interstate branching.--
                    ``(A) During the 2-year period following 
                enactment.--The Comptroller of the Currency may approve 
                an application under paragraph (1)(A) before the 
                expiration of the 2-year period described in paragraph 
                (1)(A), if the State in which the branch is or will be 
                located enacts a law during that period (in which case 
                paragraph (2)(A) shall not apply to such State) 
                expressly permitting the establishment and acquisition 
                of interstate branches in that State by all national 
                and State banks before the expiration of the time 
                period described in paragraph (1)(A).
                    ``(B) State permitted to authorize interstate 
                branching after prohibiting interstate branching.--A 
                State that originally elected, pursuant to paragraph 
                (2), to prohibit interstate branching may nonetheless 
                elect at any later time to permit interstate branching 
                if such State enacts a law expressly permitting the 
                establishment and acquisition of interstate branches in 
                that State by all national and State banks.
            ``(4) State imposed conditions on interstate branching.--A 
        State may require a bank submitting an application under this 
        subsection to file a copy of the application with the host 
        State banking authority in a timely manner (and the Comptroller 
        of the Currency shall consider any timely comments of the host 
        State prior to approving that application).
            ``(5) Definitions.--For purposes of this subsection--
                    ``(A) Host state.--The term `host State' means the 
                State in which a national bank establishes, acquires, 
                or maintains a branch other than the State in which the 
                bank has its main office and is engaging in banking 
                business.
                    ``(B) Insured depository institution.--The term 
                `insured depository institution' has the same meaning 
                as in section 3 of the Federal Deposit Insurance Act.
            ``(6) State taxation authority not affected.--No provision 
        of this subsection shall be construed to affect the authority 
        of any State or political subdivision of any State to apply any 
        tax or method of taxation to a national, State, or foreign 
        bank, or a bank holding company, when such tax or tax method is 
        otherwise permissible by or under the Constitution of the 
        United States or other Federal law.''.

SEC. 4. INTERSTATE BRANCHING BY STATE BANKS.

    Section 18(d) of the Federal Deposit Insurance Act (12 U.S.C. 
1828(d)) is amended by adding at the end the following:
            ``(3) Interstate branching by state banks.--Beginning 2 
        years after the date of the enactment of the Nationwide Banking 
        and Branching Act of 1993, an insured State bank may establish 
        or acquire, and operate, branches located outside the State in 
        which the bank is chartered if authorized by the law of the 
        State in which the bank is chartered.
            ``(4) Applicable law.--
                    ``(A) In general.--Except with regard to State tax 
                laws, any branch of an out-of-State State bank shall be 
                subject to the laws of the host State as if such branch 
                were a branch of a bank chartered by that State.
                    ``(B) Activities of branches.--An insured State 
                bank that establishes a branch or branches pursuant to 
                paragraph (3) may not conduct any activity at such 
                branch that is not permissible for a bank chartered by 
                the host State.
                    ``(C) Filing requirement.--A host State may require 
                any insured bank chartered by another State that wishes 
                to establish a branch within the host State to comply 
                with filing requirements that are not discriminatory in 
                nature and that are similar in their effect to those 
                that are imposed on a corporation from another State 
                that is not engaged in the business of banking and that 
                seeks to engage in business in the host State. The host 
                State may preclude any State bank chartered by another 
                State from establishing or operating a branch within 
                the host State if that State bank or its branch 
                materially fails to comply with the filing 
                requirements.
                    ``(D) Reservation of certain rights to states.--
                Nothing in this subsection limits in any way the right 
                of a State to--
                            ``(i) determine the authority of State 
                        banks chartered in that State to establish and 
                        maintain branches; or
                            ``(ii) supervise, regulate, and examine 
                        State banks chartered by that State.
            ``(5) State election to prohibit interstate branching.--
                    ``(A) In general.--The provisions of paragraph (3) 
                shall not apply to branches located or to be located in 
                a State which has enacted, during the period beginning 
                on the date of the enactment of the Nationwide Banking 
                and Branching Act of 1993, and ending 2 years after the 
                date of the enactment of such Act, a law that applies 
                equally to national and State banks and that expressly 
                prohibits all out-of-State banks from establishing or 
                acquiring branches located in that State.
                    ``(B) Effect of prohibition.--A State bank that is 
                chartered by a State that has in effect a prohibition 
                under subparagraph (A) may not acquire or establish a 
                branch located in any other State under the provisions 
                of paragraph (3) or paragraph (6) of this subsection.
            ``(6) State election to permit interstate branching.--
                    ``(A) During the 2-year period following 
                enactment.--A State bank may establish or acquire and 
                operate a branch outside the State in which the main 
                office of the bank is located, before the expiration of 
                the 2-year period described in paragraph (3), if the 
                State in which the branch is or will be located enacts 
                a law during that period (in which case paragraph 
                (5)(A) shall not apply to such State) expressly 
                permitting the establishment and acquisition of 
                interstate branches in that State by all national and 
                State banks before the expiration of the time period 
                described in paragraph (3).
                    ``(B) State permitted to authorize interstate 
                branching after prohibiting interstate branching.--A 
                State that originally elected, pursuant to paragraph 
                (5), to prohibit interstate branching may nonetheless 
                elect at any later time to permit interstate branching 
                if such State enacts a law expressly permitting the 
                establishment and acquisition of interstate branches in 
                that State by all national and State banks.
            ``(7) State imposed conditions on interstate branching.--
                    ``(A) A State may require a bank submitting an 
                application under the authority of paragraph (3) or 
                paragraph (6) of this subsection to file a copy of the 
                application with the host State banking authority in a 
                timely manner (and the home State banking authority and 
                the appropriate Federal banking agency shall consider 
                any timely comments of the host State prior to 
                approving that application).
                    ``(B) A State may impose other conditions on a 
                branch established or acquired under paragraph (3) or 
                paragraph (6) if--
                            ``(i) the conditions do not discriminate 
                        against out-of-State State banks or bank 
                        holding companies; and
                            ``(ii) the imposition of the conditions is 
                        not preempted by Federal law.
            ``(8) Coordination of examination authority.--
                    ``(A) In general.--A host State bank supervisory or 
                regulatory authority may examine branches established 
                or acquired in the host State by banks chartered by 
                another State for the purpose of determining compliance 
                with host State laws regarding permissible activities 
                and to ensure that the activities of the branch are 
                conducted in a manner consistent with sound banking 
                principles and do not constitute a serious risk to the 
                safety and sound operation of the branch.
                    ``(B) Enforcement.--In the event that a host State 
                bank authority as described in subparagraph (A) 
                determines that there is a violation of host State law 
                concerning the activities being conducted by the State 
                branch or that the branch is being operated in a manner 
                not consistent with sound banking principles or in an 
                unsafe and unsound manner, such host State bank 
                authority may undertake such enforcement actions or 
                proceedings as would be permitted under host State law 
                as if the branch in question were a bank chartered by 
                that host State.
                    ``(C) Cooperative agreement.--The State bank 
                authorities from one or more States are authorized to 
                enter into cooperative agreements of facilitate State 
                regulatory supervision of State banks, including 
                cooperative agreements relating to the coordination of 
                examinations and joint participation in examinations.
                    ``(D) Federal regulatory authority.--
                            ``(i) In general.--Nothing in this 
                        subsection limits in any way the authority of 
                        the appropriate Federal banking agency to 
                        examine any bank or branch of a bank for which 
                        the agency is the appropriate Federal banking 
                        agency.
                            ``(ii) Review of interstate agreements.--If 
                        the appropriate Federal banking authority 
                        determines that the States have failed to reach 
                        an agreement under subparagraph (C), or that 
                        such an agreement fails to adequately protect 
                        the Federal Deposit Insurance Fund, the 
                        appropriate Federal banking authority shall not 
                        defer to State examinations of the out-of-State 
                        branches.
            ``(9) Host state defined.--For purposes of this subsection, 
        the term `host State' means the State in which a bank 
        establishes or maintains a branch other than the State in which 
        the bank is chartered and engaging in banking business.
            ``(10) State taxation authority not affected.--No provision 
        of paragraphs (3) through (9) of this subsection shall be 
        construed to affect the authority of any State or political 
        subdivision of any State to apply any tax or method of taxation 
        to a national, State, or foreign bank, or a bank holding 
        company, when such tax or tax method is otherwise permissible 
        by or under the Constitution of the United States or other 
        Federal law.''.

SEC. 5. BRANCHING BY FOREIGN BANKS.

    (a) In General.--Section 5(a) of the International Banking Act of 
1978 (12 U.S.C. 3103(a)) is amended to read as follows:
    ``(a) Interstate Banking Operations.--
            ``(1) In general.--A foreign bank may establish and 
        operate--
                    ``(A) a Federal branch or agency, with the approval 
                of the Comptroller of the Currency, in consultation 
                with the Board, in any State outside its home State to 
                the extent that such establishment and operation would 
                be permitted under section 5155 of the Revised Statutes 
                for a national bank as if the foreign bank were a 
                national bank having its main office in the home State 
                of the foreign bank; or
                    ``(B) a State branch or agency, with the approval 
                of the Board and the appropriate regulatory authority 
                of the State, in any State outside its home State to 
                the extent that such establishment and operation would 
                be permitted under section 18(d) of the Federal Deposit 
                Insurance Act for a State bank as if the foreign bank 
                were a State bank chartered in the home State of the 
                foreign bank.
            ``(2) Criteria for determination.--In reviewing an 
        application under paragraph (1), the Board, in the cases of 
        State branches and agencies, and the Comptroller of the 
        Currency, in cases of Federal branches and agencies--
                    ``(A) shall apply the standards for establishment 
                of a foreign bank office in the United States under 
                section 7(d); and
                    ``(B) may not approve an application unless it 
                determines that the foreign bank's financial resources, 
                including the capital level, are equivalent to those 
                required for a domestic bank to be approved for 
                branching under section 5155 of the Revised Statutes 
                and section 18(d) of the Federal Deposit Insurance Act 
                and, in the case of the first branching application by 
                such foreign bank, after consultation with the 
                Secretary of the Treasury regarding capital 
                equivalency. For purposes of determining capital 
                equivalency under this paragraph, the guidelines 
                established and reported to the Congress pursuant to 
                section 7(j) of this Act shall be applied.
            ``(3) Additional authority for interstate branches and 
        agencies of foreign banks.--Notwithstanding paragraph (1) of 
        this subsection and section 4(h) of this Act, a foreign bank 
        may, with the approval of the Comptroller of the Currency, 
        establish and operate a Federal branch or Federal agency or, 
        with the approval of the Board and the appropriate State bank 
        supervisor, a State branch or State agency in any State outside 
        of the foreign bank's home State if--
                    ``(A) the establishment and operation of a branch 
                or agency is expressly permitted by the State in which 
                the branch or agency is to be established; and
                    ``(B) in the case of a Federal or State branch, the 
                branch receives only such deposits as would be 
                permissible for a corporation organized under section 
                25(a) of the Federal Reserve Act.''.
    (b) Home State Determinations.--
            (1) Method of determining.--Section 4(h) of the 
        International Banking Act of 1978 (12 U.S.C. 3102(h)) is 
        amended by adding at the end the following sentence: ``For the 
        purposes of section 5155(c) of the Revised Statutes (12 U.S.C. 
        36(c)), the home State of a foreign bank shall be its home 
        State as determined under section 5(c) of this Act.''.
            (2) Single state determinations.--Section 5(c) of the 
        International Banking Act of 1978 (12 U.S.C. 3103(c)) is 
        amended to read as follows:
    ``(c) Determination of Home State of Foreign Bank.--For the 
purposes of this section--
            ``(1) the home State of a foreign bank that has branches, 
        agencies, subsidiary commercial lending companies, or 
        subsidiary banks, or any combination thereof, in more than 1 
        State, is the 1 of those States elected by the foreign bank, 
        or, in default of such election, by the Board; and
            ``(2) the home State of a foreign bank that has branches, 
        agencies, subsidiary commercial lending companies, or 
        subsidiary banks, or any combination thereof, in only 1 State, 
        is that State.''.

SEC. 6. PERMISSIBLE COMBINATION.

    (a) Subsidiary Banks.--Section 3 of the Bank Holding Company Act of 
1956 (12 U.S.C. 1842) is amended by adding at the end of the following 
subsection:
    ``(h) Permissible Combination.--
            ``(1) In general.--A bank holding company having subsidiary 
        banks located in more than 1 State may combine 2 or more of 
        such banks into a single bank by means of merger, 
        consolidation, or other transaction on or after 2 years from 
        the date of enactment of the Nationwide Banking and Branching 
        Act of 1993. Any combination effected in accordance with this 
        subsection shall be permissible within a State as of 2 years 
        after the date of enactment of the Nationwide Banking and 
        Branching Act of 1993, unless such State has enacted a law in 
        accordance with section 5155(d)(2)(A) of the Revised Statutes 
        or section 18(d)(5)(A) of the Federal Deposit Insurance Act 
        that applies equally to national and State banks and that 
        expressly prohibits all out-of-State banks from establishing or 
        acquiring branches located in that State.
            ``(2) Branching authority.--The combined bank may, subject 
        to compliance with all applicable Federal or State laws 
        relating to the retention, establishment, acquisition, or 
        operation of a branch, retain, establish, acquire, and operate 
        additional branches at any location where the combined bank or 
        any of the parties to the combination could, if they had not 
        been parties to such combinations, have retained, established, 
        acquired, or operated a branch.
            ``(3) Applicable law.--
                    ``(A) National banks.--Except with regard to State 
                tax laws, any branch of a national bank established or 
                acquired in connection with a consolidation or other 
                transaction under paragraph (1) shall be subject to the 
                laws of the host State as if it were a branch of a 
                national bank with its main office in that State.
                    ``(B) State banks.--Except with regard to State tax 
                laws, any branch of an out-of-State State bank shall be 
                subject to the laws of the host State as if such branch 
                were a branch of a bank chartered by that State.
            ``(4) 2-year transition period.--A bank holding company 
        having subsidiary banks located in more than 1 State may 
        combine 2 or more such banks into a single bank by means of 
        merger, consolidation, or other transaction before the end of 
        the 2-year period described in paragraph (1), if each State in 
        which the banks involved in the transaction are located enacts 
        a law during that period (in which case section 5155(d)(2)(A) 
        of the Revised Statutes or section 18(d)(5)(A) of the Federal 
        Deposit Insurance Act shall not apply to such States) expressly 
        permitting interstate mergers and consolidations by all 
        national and State banks before the expiration of the time 
        period described in paragraph (1).
            ``(5) State taxation authority not affected.--No provision 
        of this subsection shall be construed to affect the authority 
        of any State or political subdivision of any State to apply any 
        tax or method of taxation to a national, State, or foreign 
        bank, or a bank holding company, when such tax or tax method is 
        otherwise permissible by or under the Constitution of the 
        United States or other Federal law.''.
    (b) National Banking Associations.--The Act entitled ``An Act to 
provide for the consolidation of national banking associations'', 
approved November 7, 1918 (12 U.S.C. 215 et seq.), is amended--
            (1) in the first sentence of subsection (a) of the first 
        section, by inserting ``, or in any State in which a bank is 
        authorized to engage in an interstate consolidation pursuant to 
        section 3(h) of the Bank Holding Company Act of 1956'' after 
        ``located in the same State'';
            (2) by adding at the end of the first section the following 
        new subsection:
    ``(h) An interstate consolidation pursuant to this section shall be 
undertaken in accordance with the limitations and requirements set 
forth in section 3(h) of the Bank Holding Company Act of 1956 as if 
such section 3(h) applied to such consolidation. The procedures, 
limitations, and requirements set forth in this section apply to 
interstate consolidations undertaken pursuant to and in accordance with 
such section 3(h) to the extent such procedures, limitations, and 
requirements of this section are not inconsistent with such section 
3(h).'';
            (3) in the first sentence of section 2(a)--
                    (A) by striking ``under an agreement not 
                inconsistent with this subchapter''; and
                    (B) by inserting ``or within any State in which a 
                bank is authorized to engage in an interstate merger 
                pursuant to section 3(h) of the Bank Holding Company 
                Act of 1956'' after ``located within the same State'';
            (4) by adding at the end of section 2 the following new 
        subsection:
    ``(h) An interstate merger pursuant to this section shall be 
undertaken in accordance with the limitations and requirements set 
forth in section 3(h) of the Bank Holding Company Act of 1956 as if 
such section 3(h) applied to such merger. The procedures, limitations, 
and requirements set forth in this section apply to interstate mergers 
undertaken pursuant to and in accordance with such section 3(h) to the 
extent such procedures, limitations, and requirements of this section 
are not inconsistent with such section 3(h).''; and
            (5) in paragraph (4) of section 3, by inserting ``or within 
        any State in which a bank that is authorized to engage in an 
        interstate consolidation or interstate merger pursuant to and 
        in accordance with section 3(h) of the Bank Holding Company Act 
        of 1956'' after ``within the same State''.

SEC. 7. STATE-BY-STATE CRA EVALUATIONS OF DEPOSITORY INSTITUTIONS WITH 
              INTERSTATE BRANCHES.

    Section 807 of the Community Reinvestment Act of 1977 (12 U.S.C. 
2906) is amended by adding at the end the following new subsection:
    ``(d) State-by-State Evaluation of Institutions With Interstate 
Branches.--In the case of a regulated financial institution which 
maintains 1 or more domestic branches located outside the State in 
which the institution's main office is located, in the case of a 
national bank, or in which the bank is chartered, in the case of a 
State bank (hereafter in this subsection referred to as the `home 
State'), the appropriate Federal financial supervisory agency shall 
prepare--
            ``(1) a written evaluation of the entire institution's 
        record of performance under this Act, as required by 
        subsections (a), (b), and (c); and
            ``(2) for each State in which the institution maintains 1 
        or more domestic branches (including the institution's home 
        State), a separate written evaluation of the institution's 
        record of performance within such State under this Act, as 
        required by subparagraphs (A) and (B) of subsection (b)(1).''.

SEC. 8. GUIDELINES FOR MEETING CREDIT NEEDS.

    Under its authority pursuant to the Community Reinvestment Act of 
1977, the appropriate Federal banking agency shall promulgate 
regulations establishing guidelines to ensure that each interstate 
branch meets the credit needs of the community and market area in which 
the branch operates.

SEC. 9. EXISTING LAW UNAFFECTED.

    No provision of this Act and no amendment made by this Act to any 
other provision of law shall be construed as affecting in any way the 
right of any State, or any political subdivision of any State, to 
impose or maintain a nondiscriminatory franchise tax or other 
nonproperty tax instead of a franchise tax in accordance with section 
3124 of title 31, United States Code.

                                 <all>

HR 459 IH----