[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[S. 883 Introduced in Senate (IS)]

  1st Session
                                 S. 883

    To amend the Federal Credit Union Act to enhance the safety and 
 soundness of federally insured credit unions, to protect the National 
       Credit Union Share Insurance Fund, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                 June 6 (legislative day, June 5), 1995

  Mr. D'Amato (for himself and Mr. Sarbanes) introduced the following 
 bill; which was read twice and referred to the Committee on Banking, 
                       Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
    To amend the Federal Credit Union Act to enhance the safety and 
 soundness of federally insured credit unions, to protect the National 
       Credit Union Share 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 ``Credit Union Reform and Enhancement 
Act''.

SEC. 2. INSURED CREDIT UNION INVESTMENTS IN OTHER CREDIT UNIONS.

    (a) Amendments to Section 107.--Section 107(7) of the Federal 
Credit Union Act (12 U.S.C. 1757(7)) is amended--
            (1) by striking subparagraph (G); and
            (2) by redesignating subparagraphs (H) through (K) as 
        subparagraphs (G) through (J), respectively.
    (b) Amendment to Section 205.--Section 205 of the Federal Credit 
Union Act (12 U.S.C. 1785) is amended by adding at the end the 
following new subsection:
    ``(j) Insured Credit Union Investments in Other Credit Unions.--An 
insured credit union may invest in shares, deposits, notes, or other 
instruments of another credit union only if such other credit union is 
also insured pursuant to this title.''.

SEC. 3. ACTIVITIES OF INSURED STATE-CHARTERED CREDIT UNIONS.

    Section 205 of the Federal Credit Union Act (12 U.S.C. 1785) is 
amended by adding at the end the following new subsection:
    ``(k) Activities of Insured State-Chartered Credit Unions.--
            ``(1) In general.--A State-chartered insured credit union 
        may not exercise asset powers of a type, or in an amount, not 
        authorized for Federal credit unions, unless either--
                    ``(A) the asset power was--
                            ``(i) authorized pursuant to the laws of 
                        the State in which the credit union is 
                        chartered; and
                            ``(ii) being utilized by one or more credit 
                        unions in that State on May 1, 1995; or
                    ``(B) the Board determines that the exercise of the 
                asset power would pose no significant risk to the Fund.
            ``(2) Continued rulemaking authority.--Nothing in this 
        subsection shall restrict or limit in any way the general 
        rulemaking authority of the Board.
            ``(3) Definition.--For purposes of this subsection, the 
        term `asset powers' refers to any item or activity properly 
        reflected on the asset side of the financial statements of a 
        credit union, as may be more specifically defined by regulation 
        of the Board.''.

SEC. 4. CORPORATE CREDIT UNIONS.

    (a) In General.--Section 120(a) of the Federal Credit Union Act (12 
U.S.C. 1766(a)) is amended--
            (1) in the second sentence, by striking ``central credit 
        union'' and inserting ``corporate credit union''; and
            (2) by adding at the end the following: ``The Board shall, 
        by regulation, establish limits on loans and investments by a 
        corporate credit union to a single obligor and minimum capital 
        requirements for corporate credit unions.''.
    (b) Definition.--Section 101 of the Federal Credit Union Act (12 
U.S.C. 1752) is amended by adding at the end the following new 
paragraph:
            ``(10) The term `corporate credit union' has the meaning 
        given to that term under the rules or regulations of the 
        Board.''.

SEC. 5. AUTHORITY OF THE NCUA BOARD TO PLACE FEDERALLY INSURED STATE-
              CHARTERED CREDIT UNIONS INTO LIQUIDATION.

    Section 207(a)(1) of the Federal Credit Union Act (12 U.S.C. 
1787(a)(1)) is amended--
            (1) by redesignating subparagraph (B) as subparagraph (C);
            (2) in subparagraph (C), as redesignated, by striking 
        ``paragraph (1)'' and inserting ``subparagraph (A) or (B)''; 
        and
            (3) by inserting after subparagraph (A) the following new 
        subparagraph:
    ``(B) Notwithstanding any other provision of this Act or other law, 
the Board may, after prior consultation with the appropriate State 
credit union supervisory authority, appoint itself as a liquidating 
agent for any State-chartered credit union that is insured under this 
title, and may close such credit union, if the Board determines that 
the credit union is insolvent or bankrupt. In any such case, the Board 
shall have all of the rights, privileges, powers, and duties specified 
in this section as applicable to the liquidation of Federal credit 
unions.''.

SEC. 6. CONSULTATION FOR CONSERVATORSHIPS OF FEDERALLY INSURED STATE-
              CHARTERED CREDIT UNIONS.

    Section 206(h)(2) of the Federal Credit Union Act (12 U.S.C. 
1786(h)(2)) is amended to read as follows:
            ``(2) In the case of a State-chartered insured credit 
        union, the authority conferred by paragraph (1) shall not be 
        exercised without prior consultation with the appropriate State 
        credit union supervisory authority.''.
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