[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2351 Introduced in House (IH)]

111th CONGRESS
  1st Session
                                H. R. 2351

    To amend the Federal Credit Union Act to increase the borrowing 
  authority of the National Credit Union Administration, establish a 
  National Credit Union Share Insurance Fund restoration plan period, 
    assess insured credit unions for the costs associated with the 
 corporate credit union stabilization effort on an anticyclical basis, 
                        and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 12, 2009

  Mr. Kanjorski (for himself, Mr. Gutierrez, Mr. Royce, Mr. Scott of 
 Georgia, and Mr. LaTourette) introduced the following bill; which was 
            referred to the Committee on Financial Services

_______________________________________________________________________

                                 A BILL


 
    To amend the Federal Credit Union Act to increase the borrowing 
  authority of the National Credit Union Administration, establish a 
  National Credit Union Share Insurance Fund restoration plan period, 
    assess insured credit unions for the costs associated with the 
 corporate credit union stabilization effort on an anticyclical basis, 
                        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 Share Insurance 
Stabilization Act''.

SEC. 2. NCUA BORROWING AUTHORITY.

    (a) NCUA Borrowing Authority.--Section 203(d)(1) of the Federal 
Credit Union Act (12 U.S.C. 1783(d)(1)) is amended to read as follows:
            ``(1) If, in the judgment of the Board, a loan to the 
        insurance fund, or to the stabilization fund described in 
        section 217, is required at any time for purposes of this 
        title, the Secretary of the Treasury shall make the loan, but 
        loans under this paragraph shall not exceed in the aggregate 
        $6,000,000,000 outstanding at any one time. Except as otherwise 
        provided in this subsection, section 217, and in subsection (e) 
        of this section, each loan under this paragraph shall be made 
        on such terms as may be fixed by agreement between the Board 
        and the Secretary of the Treasury.''.
    (b) Temporary Increases of Borrowing Authority for NCUA.--Section 
203(d) of the Federal Credit Union Act (12 U.S.C. 1783(d)) is amended 
by adding at the end the following:
            ``(4) Temporary increases authorized.--
                    ``(A) Recommendations for increase.--During the 
                period beginning on the date of enactment of this 
                paragraph and ending on December 31, 2010, if, upon the 
                written recommendation of the Board (upon a vote of not 
                less than two-thirds of the members of the Board) and 
                the Board of Governors of the Federal Reserve System 
                (upon a vote of not less than two-thirds of the members 
                of such Board), the Secretary of the Treasury (in 
                consultation with the President) determines that 
                additional amounts above the $6,000,000,000 amount 
                specified in paragraph (1) are necessary, such amount 
                shall be increased to the amount so determined to be 
                necessary, not to exceed $30,000,000,000.
                    ``(B) Report required.--If the borrowing authority 
                of the Board is increased above $6,000,000,000 pursuant 
                to subparagraph (A), the Board shall promptly submit a 
                report to the Committee on Banking, Housing, and Urban 
                Affairs of the Senate and the Committee on Financial 
                Services of the House of Representatives describing the 
                reasons and need for the additional borrowing authority 
                and its intended uses.''.

SEC. 3. ESTABLISHMENT OF A NATIONAL CREDIT UNION SHARE INSURANCE FUND 
              RESTORATION PLAN PERIOD.

    Section 202(c)(2) of the Federal Credit Union Act (12 U.S.C. 
1782(c)(2)) is amended by adding at the end the following new 
subparagraph:
                    ``(D) Fund restoration plans.--
                            ``(i) In general.--Whenever--
                                    ``(I) the Board projects that the 
                                equity ratio of the Fund will, within 6 
                                months of such determination, fall 
                                below the minimum amount specified in 
                                subparagraph (C); or
                                    ``(II) the equity ratio of the Fund 
                                actually falls below the minimum amount 
                                specified in subparagraph (C) without 
                                any determination under subclause (I) 
                                having been made,
                        the Board shall establish and implement a 
                        restoration plan within 90 days that meets the 
                        requirements of clause (ii) and such other 
                        conditions as the Board determines to be 
                        appropriate.
                            ``(ii) Requirements of restoration plan.--A 
                        restoration plan meets the requirements of this 
                        clause if the plan provides that the equity 
                        ratio of the Fund will meet or exceed the 
                        minimum amount specified in subparagraph (C) 
                        before the end of the 8-year period beginning 
                        upon the implementation of the plan (or such 
                        longer period as the Board may determine to be 
                        necessary due to extraordinary circumstances).
                            ``(iii) Transparency.--Not more than 30 
                        days after the Board establishes and implements 
                        a restoration plan under clause (i), the Board 
                        shall publish in the Federal Register a 
                        detailed analysis of the factors considered and 
                        the basis for the actions taken with regard to 
                        the plan.''.

SEC. 4. TEMPORARY CORPORATE CREDIT UNION STABILIZATION FUND.

    (a) Establishment of Temporary Corporate Credit Union Stabilization 
Fund.--Title II of the Federal Credit Union Act (12 U.S.C. 1781 et 
seq.) is amended by adding at the end the following new section:

``SEC. 217. TEMPORARY CORPORATE CREDIT UNION STABILIZATION FUND.

    ``(a) Establishment of Stabilization Fund.--There is hereby created 
in the Treasury of the United States a fund to be known as the 
`Temporary Corporate Credit Union Stabilization Fund' (and referred to 
hereafter in this section as the `Stabilization Fund') to be 
administered by the Board as prescribed by section 209.
    ``(b) Expenditures From Stabilization Fund.--Money in the 
Stabilization Fund shall be available upon requisition by the Board, 
without fiscal year limitation, for making payments for the purposes 
described in section 203(a), subject to the following additional 
limitations:
            ``(1) All payments other than administrative payments shall 
        be connected to the conservatorship, liquidation, or threatened 
        conservatorship or liquidation of a corporate credit union.
            ``(2) Prior to authorizing each payment, the Board shall--
                    ``(A) certify that, absent the existence of the 
                Stabilization Fund, the Board would have made the 
                identical payment out of the National Credit Union 
                Share Insurance Fund; and
                    ``(B) report each such certification to the 
                Committee on Banking, Housing, and Urban Affairs of the 
                Senate and the Committee on Financial Services of the 
                House of Representatives.
    ``(c) Authority To Borrow.--
            ``(1) In general.--The Stabilization Fund is authorized to 
        borrow from the Secretary of the Treasury from time-to-time as 
        deemed necessary by the Board. The maximum outstanding amount 
        of all borrowings from the Treasury by the Stabilization Fund 
        and the National Credit Union Share Insurance Fund, combined, 
        is limited to the amount provided for in section 203(d)(1), 
        including any authorized increases in that amount.
            ``(2) Repayment of advances.--
                    ``(A) In general.--The advances made under this 
                section shall be repaid by the Stabilization Fund, and 
                interest on such advances shall be paid, to the General 
                Fund of the Treasury.
                    ``(B) Variable rate of interest.--The Secretary of 
                the Treasury shall make the first rate determination at 
                the time of the first advance under this section and 
                shall reset the rate again for all advances on each 
                anniversary of the first advance. The interest rate 
                shall be equal to the average market yield on 
                outstanding marketable obligations of the United States 
                with remaining periods to maturity equal to 12 months.
            ``(3) Repayment schedule.--The Stabilization Fund shall 
        repay the advances on a first-in, first-out basis, with 
        interest on the amount repaid, at times and dates determined by 
        the Board at its discretion. All advances shall be repaid not 
        later than the date of the seventh anniversary of the first 
        advance to the Stabilization Fund, unless the Board extends 
        this final repayment date. The Board shall obtain the 
        concurrence of the Secretary of the Treasury on any proposed 
        extension, including the terms and conditions of the extended 
        repayment.
    ``(d) Assessment To Repay Advances.--At least 90 days prior to each 
repayment described in subsection (c)(3), the Board shall set the 
amount of the upcoming repayment and determine if the Stabilization 
Fund will have sufficient funds to make the repayment. If the 
Stabilization Fund might not have sufficient funds to make the 
repayment, the Board shall assess each federally insured credit union a 
special premium due and payable within 60 days in an aggregate amount 
calculated to ensure the Stabilization Fund is able to make the 
repayment. The premium charge for each credit union shall be stated as 
a percentage of its insured shares as represented on the credit union's 
previous call report. The percentage shall be identical for each credit 
union. Any credit union that fails to make timely payment of the 
special premium is subject to the procedures and penalties described 
under subsections (d), (e), and (f) of section 202.
    ``(e) Distributions From Insurance Fund.--At the end of any 
calendar year in which the Stabilization Fund has an outstanding 
advance from the Treasury, the Insurance Fund is prohibited from making 
the distribution to insured credit unions described in section 
202(c)(3). In lieu of the distribution described in that section, the 
Insurance Fund shall make a distribution to the Stabilization Fund of 
the maximum amount possible that does not reduce the Insurance Fund's 
equity ratio below the normal operating level and does not reduce the 
Insurance Fund's available assets ratio below 1.0 percent.
    ``(f) Investment of Stabilization Fund Assets.--The Board may 
request the Secretary of the Treasury to invest such portion of the 
Stabilization Fund as is not, in the Board's judgment, required to meet 
the current needs of the Stabilization Fund. Such investments shall be 
made by the Secretary of the Treasury in public debt securities, with 
maturities suitable to the needs of the Stabilization Fund, as 
determined by the Board, and bearing interest at a rate determined by 
the Secretary of the Treasury, taking into consideration current market 
yields on outstanding marketable obligations of the United States of 
comparable maturity.
    ``(g) Reports.--The Board shall submit an annual report to Congress 
on the financial condition and the results of the operation of the 
Stabilization Fund. The report is due to Congress within 30 days after 
each anniversary of the first advance made under subsection (c)(1). 
Because the Stabilization Fund will use advances from the Treasury to 
meet corporate stabilization costs with full repayment of borrowings to 
Treasury at the Board's discretion not due until 7 years from the 
initial advance, to the extent operating expenses of the Stabilization 
Fund exceed income, the financial condition of the Stabilization Fund 
may reflect a deficit. With planned and required future repayments, the 
Board shall resolve all deficits prior to termination of the 
Stabilization Fund.
    ``(h) Closing of the Stabilization Fund.--Within 90 days following 
the seventh anniversary of the initial Stabilization Fund advance, or 
earlier at the Board's discretion, the Board shall distribute any 
funds, property, or other assets remaining in the Stabilization Fund to 
the Insurance Fund and shall close the Stabilization Fund. If the Board 
extends the final repayment date as permitted under subsection (c)(3), 
the mandatory date for closing the Stabilization Fund shall be extended 
by the same number of days.''.
    (b) Conforming Amendment.--Section 202(c)(3)(A) of the Federal 
Credit Union Act (12 U.S.C. 1782(c)(3)(A)) is amended by inserting ``, 
subject to the requirements of section 217(e),'' after ``The Board 
shall''.
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