[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4209 Introduced in House (IH)]

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118th CONGRESS
  1st Session
                                H. R. 4209

     To prohibit stock sales by senior bank executives in certain 
                             circumstances.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             June 20, 2023

   Ms. Waters (for herself, Ms. Velazquez, Mr. Sherman, Mr. Green of 
Texas, Mr. Cleaver, Mrs. Beatty, Ms. Garcia of Texas, Mr. Horsford, and 
  Ms. Tlaib) introduced the following bill; which was referred to the 
                    Committee on Financial Services

_______________________________________________________________________

                                 A BILL


 
     To prohibit stock sales by senior bank executives in certain 
                             circumstances.

    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 ``Incentivizing Safe and Sound Banking 
Act''.

SEC. 2. STOCK SALE PROHIBITION.

    (a) Authority To Prohibit Stock Sales Relating To Cease and Desist 
Orders.--Section 8(b) of the Federal Deposit Insurance Act (12 U.S.C. 
1818(b)) is amended by inserting at the end the following:
            ``(11) Stock sale prohibition.--The authority to issue an 
        order under this subsection or subsection (c) includes the 
        authority to prohibit the sale of securities of the insured 
        depository institution and any affiliate of such insured 
        depository institution received and owned by any current or 
        former officer or director of the insured depository 
        institution or any institution-affiliated party that received 
        such securities as a form of compensation.''.
    (b) Automatic Prohibition.--Section 8 of the Federal Deposit 
Insurance Act (12 U.S.C. 1818) is further amended by adding at the end 
the following:
    ``(y) Automatic Prohibition of Stock Sale.--
            ``(1) In general.--If a covered banking institution has a 
        composite or component rating of 3, 4, or 5 under the Uniform 
        Financial Institutions Rating System (or an equivalent rating 
        under a comparable rating system), or the appropriate Federal 
        banking agency issues a `matter requiring immediate attention' 
        (or similar supervisory notice, as determined by the 
        appropriate Federal banking agency) to a covered banking 
        institution, and the institution does not remediate the issue 
        by the deadline established by the appropriate Federal banking 
        agency, any senior executive officer may not sell securities of 
        the covered banking institution or any affiliate of the covered 
        banking institution that the individual received as a form of 
        compensation, until the matter is resolved to the satisfaction 
        of the appropriate Federal banking agency.
            ``(2) Covered banking institution.--In this subsection, the 
        term `covered banking institution' means--
                    ``(A) a bank holding company with more than 
                $50,000,000,000 in consolidated assets;
                    ``(B) a bank subsidiary of a bank holding company 
                described under subparagraph (A); or
                    ``(C) a bank or savings association with more than 
                $50,000,000,000 in consolidated assets.''.
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