[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1470 Introduced in House (IH)]







104th CONGRESS
  1st Session
                                H. R. 1470

 To provide for sufficient funding to cover the costs of the Financing 
Corporation, to provide funds to carry out the purposes of the Savings 
          Association Insurance Fund, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             April 7, 1995

 Mr. LaFalce introduced the following bill; which was referred to the 
              Committee on Banking and Financial Services

_______________________________________________________________________

                                 A BILL


 
 To provide for sufficient funding to cover the costs of the Financing 
Corporation, to provide funds to carry out the purposes of the Savings 
          Association Insurance Fund, 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.

    This Act may be cited as the ``Financing Corporation and Savings 
Association Insurance Fund Reform Act of 1995''.

SEC. 2. PAYMENT OF INTEREST EARNED ON RTC FUNDS TO FICO.

    (a) In General.--Subsection (i) of section 21A of the Federal Home 
Loan Bank Act (12 U.S.C. 1441a(i)) is amended by adding at the end the 
following new paragraph:
            ``(7) Trust fund for unexpended rtc funding.--
                    ``(A) In general.--The Secretary of the Treasury 
                shall transfer that portion of the amounts appropriated 
                under paragraph (3) which are available to the 
                Corporation but have not been paid to the Corporation 
                to the Federal Deposit Insurance Corporation for 
                deposit in a trust fund to be managed by the Federal 
                Deposit Insurance Corporation.
                    ``(B) Investment.--The Board of Directors of the 
                Federal Deposit Insurance Corporation shall invest such 
                portion of the trust fund established under 
                subparagraph (A) as, in the judgment of the Board of 
                Directors, is not required to meet the short-term 
                requirements of the Resolution Trust Corporation or the 
                Savings Association Insurance Fund.
                    ``(C) Interest.--Interest earned on investments of 
                the trust fund shall be paid to the Financing 
                Corporation to meet interest payments, issuance costs, 
                and custodial fees on obligations issued by the 
                Financing Corporation.
                    ``(D) Availability of trust fund principal as 
                backstop for saif.--The balance in the trust fund shall 
                be available to the Federal Deposit Insurance 
                Corporation to cover losses incurred, or reasonably 
                anticipated to be incurred, by the Savings Association 
                Insurance Fund until the reserve ration of the Savings 
                Association Insurance Fund first meets or exceeds the 
                applicable designated reserve ratio.
                    ``(E) Return of unexpended principal to treasury.--
                After the maturity and full repayment of all 
                obligations issued by the Financing Corporation under 
                section 21, any remaining balance in the trust fund 
                shall be returned to the general fund of the Treasury 
                and the trust fund shall be abolished.''.
    (b) Technical and Conforming Amendments.--
            (1) Section 21A(i)(5) of the Federal Home Loan Bank Act (12 
        U.S.C. 1441a(i)(5)) is amended--
                    (A) by striking ``or to meet the requirements of 
                section 11(a)(6)(F) of the Federal Deposit Insurance 
                Act''; and
                    (B) by striking ``general fund of the Treasury'' 
                and inserting ``trust fund established pursuant to 
                paragraph (7)(A)''.
            (2) Section 11(a)(6) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1821(a)(6)) is amended by striking subparagraph (F).
            (3) Section 11(a)(6)(K) of the Federal Deposit Insurance 
        Act (12 U.S.C. 1821(a)(6)(K)) is amended by striking ``or 
        (F)''.

SEC. 3. CLARIFICATION OF EXISTING LAW.

    (a) Congressional Declaration.--The Congress declares as follows:
            (1) The Financing Corporation was established pursuant to 
        the amendments made by title III of the Competitive Equality 
        Banking Act of 1987 for the sole purpose of providing 
        additional funding to the Federal Savings and Loan Insurance 
        Corporation to meet the deposit insurance obligations of the 
        Corporation with respect to savings associations.
            (2) The interest payments, issuance costs, and custodial 
        fees on obligations issued by the Financing Corporation are 
        paid, pursuant to section 21 of the Federal Home Loan Bank Act, 
        by assessments on savings associations.
            (3) The total amount of assessments paid by savings 
        associations to the Federal Savings and Loan Insurance 
        Corporation, and since 1989, to the Federal Deposit Insurance 
        Corporation, as premiums for deposit insurance are required to 
        be reduced by the amount of the assessments paid by such 
        associations to the Financing Corporation in recognition of the 
        fact that the latter assessments are being made to finance the 
        insurance obligations incurred with respect to savings 
        associations.
    (b) Treatment of FICO Assessments.--The assessments paid by Savings 
Association Insurance Fund members to the Financing Corporation shall 
be treated as insurance outlays for purposes of Federal law.

SEC. 4. 1-TIME SPECIAL SAIF CAPITALIZATION ASSESSMENT.

    Section 7(b) of the Federal Deposit Insurance Act (12 U.S.C. 
1817(b)) is amended by adding at the end the following new paragraph:
            ``(8) Special 1-time assessment to recapitalize saif.--
                    ``(A) In general.--The Corporation may, in the 
                discretion of the Board of Directors, impose a special 
                assessment on each Savings Association Insurance Fund 
                member in an amount not greater than 0.40 percent of 
                the assessment base, as of January 1, 1995, on which 
                assessments are imposed under the risk-based assessment 
                system established pursuant to paragraph (1).
                    ``(B) Deposit of assessment in saif.--The proceeds 
                of any assessment imposed under subparagraph (A) shall 
                be deposited in the Savings Association Insurance Fund.
                    ``(C) Imposition over period of years.--The 
                assessment authorized under subparagraph (A) may be 
                imposed incrementally over such period of years as the 
                Board of Directors may determine to be appropriate, 
                except the larger percentage of any such incremental 
                assessment shall be allocated to the first year of the 
                effective period for such assessment.
                    ``(D) Abatement for troubled institutions.--The 
                Board of Directors may abate any portion of any 
                assessment under this paragraph in the case of any 
                undercapitalized institution or any institution which 
                would become undercapitalized as a result of the 
                imposition of such assessment.''.

SEC. 5. REPEAL OF MINIMUM SAIF ASSESSMENT RULE.

    Section 7(b)(2) of the Federal Deposit Insurance Act (12 U.S.C. 
1817(b)(2)) is amended by striking subparagraph (E).

SEC. 6. LIMIT ON DIFFERENTIAL BETWEEN ASSESSMENT RATES IMPOSED ON 
              FORMER BIF MEMBERS AND FORMER SAIF MEMBERS.

    Section 7(b)(2) of the Federal Deposit Insurance Act (12 U.S.C. 
1817(b)(2)) is amended by inserting after paragraph (G) the following 
new subparagraph:
                    ``(H) Cap on differential between former bif and 
                saif members.--The average assessment rate under the 
                risk-based assessment system for insured depository 
                institutions which, as of December 31, 1994, were 
                Savings Association Insurance Fund members, including 
                the special assessment under paragraph (9), shall not 
                exceed the average assessment rate under the risk-based 
                assessment system for insured depository institutions 
                which, as of December 31, 1994, were Bank Insurance 
                Fund members by more than 9 basis points.''.
                                 <all>