[Congressional Record Volume 153, Number 185 (Wednesday, December 5, 2007)]
[House]
[Pages H14174-H14176]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




     PRESERVING AND EXPANDING MINORITY DEPOSITORY INSTITUTIONS ACT

  Mr. WATT. Mr. Speaker, I move to suspend the rules and pass the bill 
(H.R. 4043) to amend the Financial Institutions Reform, Recovery, and 
Enforcement Act of 1989 to preserve and expand minority depository 
institutions, and for other purposes, as amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 4043

       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 ``Preserving and Expanding 
     Minority Depository Institutions Act''.

     SEC. 2. PRESERVING AND EXPANDING MINORITY DEPOSITORY 
                   INSTITUTIONS.

       (a) In General.--Section 308(a) of the Financial 
     Institutions Reform, Recovery, and Enforcement Act of 1989 
     (12 U.S.C. 1463(a) nt.) is amended--
       (1) by inserting ``the Chairman of the Board of Governors 
     of the Federal Reserve System, the Comptroller of the 
     Currency'' after ``consult with''; and
       (2) by inserting a comma after ``Thrift Supervision''.
       (b) Report.--Section 308 of the Financial Institutions 
     Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1463 
     nt.) is amended by adding at the end the following new 
     subsection:
       ``(c) Reports.--The Secretary of the Treasury, the Chairman 
     of the Board of Governors of the Federal Reserve System, the 
     Comptroller of the Currency, the Director of the Office of 
     Thrift Supervision, and the Chairperson of the Federal 
     Deposit Insurance Corporation shall each submit an annual 
     report to the Congress containing a description of actions 
     taken to carry out this section.''.
       (c) Technical and Conforming Amendment.--Effective upon the 
     enactment of subsection (b), section 3(g)(2) of the Home 
     Owners' Loan Act (12 U.S.C. 1462a(g)(2)) is amended to read 
     as follows:
       ``(2) [Repealed].''.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
North Carolina (Mr. Watt) and the gentlewoman from West Virginia (Mrs. 
Capito) each will control 20 minutes.
  The Chair recognizes the gentleman from North Carolina.


                             General Leave

  Mr. WATT. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days within which to revise and extend their remarks 
on this legislation and to insert extraneous materials thereon.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from North Carolina?
  There was no objection.
  Mr. WATT. Mr. Speaker, I yield myself such time as I may consume.
  I submit for the Record a letter dated November 1, 2007, from the 
National Bankers Association in support of this legislation.

                                 National Bankers Association,

                                 Washington, DC, November 1, 2007.
     Hon. Melvin Watt, Chairman,
     Financial Institutions and Consumer Credit Oversight and 
         Investigations,
     House of Representatives, Washington, DC.
       Dear Chairman Watt: On behalf of the National Bankers 
     Association (NBA) (the voice of minority banks since 1927), 
     its board and membership, thank you for taking the time to 
     hold a hearing of the Subcommittee on Government Oversight 
     and Investigations of the Committee on Financial Services on 
     behalf of the nation's women and minority-owned banks. We 
     appreciate your continued support of our banks. We are 
     especially proud that the Financial Services Committee staff 
     invited the National Bankers Association to participate in 
     this important hearing. We support your idea of a joint 
     hearing with the Ways & Means Committee on the CDFI and New 
     Markets Tax Credits Programs.
       NBA supports the revision of the ``Preserving and Expanding 
     Minority Depository Institutions Act'' H.R. 4043 to include 
     the Office of the Comptroller of the Currency and the Federal 
     Reserve along with the Federal Deposit Insurance Corporation 
     and the Office of Thrift Supervision in the legislation.
       We also appreciate you taking the time out of your busy 
     schedule every year to participate in NBA's Annual 
     Legislative Summit. Your support has given NBA an elevated 
     level of attention by other congressional members and bank 
     regulators.
       Again, many thanks.
       Respectfully submitted,
       The National Bankers Association Board of Directors:
       Floyd Weekes, Chairman, Executive Vice President, Citizens 
     Bank, Nashville, TN.
       James E. Young, Past-Chairman, President & CEO, Citizens 
     Trust Bank, Atlanta, GA.
       Robert P. Cooper, Chairman-Elect, Senior Counsel, OneUnited 
     Bank, Boston, MA.
       Tommy Brooks, Treasurer, Executive Vice President & CFO, 
     Unity National Bank, Houston, TX.
       Cynthia Day, Secretary, Chief Financial Officer, Citizens 
     Trust Bank, Atlanta, GA.
       Norma Alexander Hart, President, NBA, Washington, DC.
       Mark Ronan, Corporate Advisory Board Chairman, Director of 
     Banking Relations, American Express Company, NY.
       Sidney King, Regional Vice Chairman, President & CEO, 
     Commonwealth National Bank, Mobile, AL.
       Stanley Weekes, Regional Vice Chairman, Executive Vice 
     President & CCO, City National Bank of New Jersey.
       Arlene Williams, Regional Vice Chairman, Senior Vice 
     President, Seaway National Bank, Chicago, IL.
       Steve Holt, Regional Vice Chairman, President and CEO, One 
     World Bank, Dallas, TX.
       Tony James, Associate-Affiliate President, Senior Vice 
     President, ICBA Securities.
       Deloris Sims, Board Member, President & CEO, Legacy Bank, 
     Milwaukee, WI.
       Nativido Lozano, III, Board Member, Vice President, 
     International Bank of Commerce, Laredo, TX.
       James Ballentine, Board Member, Director, Grassroots 
     Advocacy, American Bankers Association, Washington, DC.
       Viveca Ware, Board Member, Director, of Payments & 
     Technology Policy, Independent Community Bankers of America, 
     Washington, DC.
       And, The following members from the 52 membership of the 
     National Bankers Association:
       Broadway Federal Bank, Los Angeles, CA;
       Unity National Bank, Houston, TX;
       People's Bank of Seneca, Seneca, MO;
       United Americas Bank, Atlanta, GA;
       Seaway National Bank, Chicago, IL;
       First State Bank, Danville, VA;
       First Independence Bank, Detroit, MI;
       OneUnited Bank, Boston, MA;
       Commonwealth National Bank, Mobile, AL;
       OneWorld Bank, Dallas, TX;
       Citizens Trust Bank, Atlanta, GA;
       Citizens Bank, Nashville, TN;
       Mutual Community Savings Bank, Durham, NC;
       Mechanic & Farmers, Durham, NC;
       Saigon National Bank, Westminster, CA;
       United Bank of Philadelphia, Philadelphia, PA;
       Liberty Bank & Trust, New Orleans LA;
       Industrial Bank, Washington, DC.

  Mr. Speaker, allow me to start today by expressing the collective 
condolences of the members of the Oversight and Investigations 
Subcommittee of the House Financial Services Committee to our ranking 
member, Representative Gary Miller, following the death of his 
daughter. Representative Miller was an original cosponsor with me of 
the legislation we are considering, H.R. 4043, and he and his staff 
encouraged us to proceed with consideration of the bill today when we 
offered to withdraw it from the calendar and wait until he returns to 
Congress following the sudden death of his daughter.
  I am deeply indebted to Representative Miller for the cordial manner 
in which he has worked with me as the ranking member of our 
subcommittee, for his support of H.R. 4043 to ensure that this 
important legislation is considered in the bipartisan way it deserves, 
and for his encouragement to us

[[Page H14175]]

to proceed with consideration of this important bill so it will not be 
delayed. All of us wish Representative Miller the very best as he and 
his family try to cope with a loss that we know is devastating to him. 
Representative Miller's absence under these circumstances casts a 
significant pall on our consideration of this bill, but we must 
proceed, and I am happy to do so with his approval.
  Minority-owned banks and thrifts comprise about 2 percent of all 
banks, thrifts, and banking assets in the United States. Under section 
308 of the Financial Institutions Reform, Recovery and Enforcement Act, 
the Secretary of the Treasury is required to consult with the Chair of 
the Board of Directors of the Federal Deposit Insurance Corporation and 
the Director of the Office of Thrift Supervision on methods to achieve 
the following five goals:
  One, preserving existing minority banks; two, preserving the minority 
character of these institutions in cases involving mergers or 
acquisitions of minority banks; three, providing technical assistance 
to prevent the insolvency of existing minority institutions that are 
not insolvent; four, promoting and encouraging the creation of new 
minority banks; and, five, providing for training, technical 
assistance, and educational programs to assist minority banking 
institutions.
  The requirement for consultation between the Secretary of the 
Treasury, the FDIC, and the OTS has been on the books since the passage 
of the Financial Institutions Reform, Recovery and Enforcement Act in 
1989, and the Office of Thrift Supervision has been required to submit 
an annual report to Congress describing actions taken to achieve these 
five goals that help preserve and expand minority banks.
  On October 30, 2007, our Financial Services Oversight and 
Investigations Subcommittee, which I am privileged to chair, held a 
hearing about a report issued by the U.S. Government Accountability 
Office in October of 2006 that reviewed Federal banking regulators' 
efforts to promote these five goals. This report, entitled ``Minority 
Banks: Regulators Need To Better Assess Effectiveness of Support 
Efforts,'' found that, despite recommendations contained in a similar 
1993 Government Accountability Office report, none of the Federal 
banking regulators have routinely surveyed institutions within their 
jurisdiction to assess the effectiveness of the regulators' support 
efforts to minority banks nor have the regulators systematically 
established outcome-oriented performance measures to gauge the 
effectiveness or results of the regulators' efforts. In short, the 
efforts being taken by the regulators to preserve and promote minority 
banks appeared modest, and whether the efforts are being effective 
could not be ascertained. The regulators were taking some steps, but 
there were no outcome measures to judge their effectiveness. Indeed, if 
the number and strength of minority financial institutions since 1989 
is a barometer, the efforts of the regulators appear not to be having 
the positive results we desire.
  H.R. 4043 would, in effect, increase the pressure on and transparency 
of the regulators' efforts by requiring all of them, the Federal 
Deposit Insurance Corporation, the Federal Reserve, the Office of the 
Comptroller of the Currency, and the Office of Thrift Supervision, to 
submit an annual report to Congress on their efforts to implement the 
goals outlined in section 308 of FIRREA, the goals of preserving and 
supporting and promoting minority businesses.
  At the subcommittee hearing, all the regulators acknowledged that 
they could and should be doing more and indicated that they do not 
object to a statutory change to expand the goals of section 308 of 
FIRREA to their agencies. In addition, witnesses from the FDIC, the 
Federal Reserve, and the OCC indicated that they do not object to being 
obligated to prepare and submit to Congress an annual report describing 
their efforts to promote and preserve minority depository institutions. 
H.R. 4043 requires this, and I encourage my colleagues to support the 
bill.
  Mr. Speaker, I reserve the balance of my time.
  Mrs. CAPITO. Mr. Speaker, I yield myself such time as I may consume.
  I rise in support of H.R. 4043, the Preserving and Expanding Minority 
Depository Institutions Act of 2007. This bipartisan legislation, 
introduced by Chairman Watt and Ranking Member Miller of the Financial 
Services Oversight and Investigations Subcommittee is intended to 
support our Nation's minority banks. The bill includes new reporting 
requirements which will help gauge the effectiveness of government 
programs that assist minority banks. Like other community banks, 
minority banks may confront unique challenges because of their smaller 
size.
  Section 308 of FIRREA, the Financial Institutions Reform, Recovery 
and Enforcement Act of 1989, mandates that the FDIC in conjunction with 
the Office of Thrift Supervision work to preserve existing minority 
banks, promote the creation of new minority banks, and provide 
technical assistance and training. Although not required to do so, the 
Office of the Comptroller of the Currency and the Federal Reserve also 
provide assistance to minority banks.
  H.R. 4043 will codify the advisory role of the OCC and the Federal 
Reserve by expanding section 308 of FIRREA to include both of these 
agencies. Additionally, the legislation directs all four banking 
regulators to report annually to Congress on their efforts to preserve, 
promote, and assist minority banks.
  At an October 30 Oversight and Investigations Subcommittee hearing on 
minority banks, the OCC and Federal Reserve did not object to being 
covered by section 308 of FIRREA, and all four regulators stated that 
they would also not object to the annual reporting requirement since 
most of them already include minority bank information in reports they 
currently submit to Congress.
  At that same hearing, the subcommittee heard testimony that many of 
the regulators' programs are underutilized by the minority banks they 
are designed to help. According to a report issued by the Government 
Accountability Office last year, most of the banks that did participate 
found these programs very, very useful. Minority banks should be 
encouraged to use any and all the tools provided to them by the Federal 
regulators.
  I, too, join with my colleague Congressman Watt in extending our deep 
sympathy and great caring for our colleague Congressman Miller while 
he's going through the tragedy in his family. We miss him here, but his 
imprint is being felt through this legislation today, and we wish him 
God's help in dealing with this crisis.

                              {time}  1245

  Mr. Speaker, I urge my colleagues to join me in supporting this 
legislation, and I yield back the balance of my time.
  Mr. WATT. Mr. Speaker, I have no further requests for time.
  Let me conclude, then, by just expressing our sincere thanks to our 
colleagues on the Republican side and to all of the members of the 
staff for their work on this bill. We think it is a good bill. It is a 
bipartisan effort to increase transparency and information to Congress 
and to promote the expansion and preservation of minority financial 
institutions, all of which we think is good. I encourage my colleagues 
to support the bill.
  Ms. JACKSON-LEE of Texas. Mr. Speaker, I rise today in support of 
H.R. 4043, the ``Preserving and Expanding Minority Depository 
Institutions Act''. Minority-owned financial institutions are vitally 
important to the economic development and revitalization of urban and 
minority communities. Businesses and residents in these traditionally 
underserved communities rely on minority-owned financial institutions 
to serve their banking and other financial services needs. They have 
always been there when we needed them--making homeownership a reality 
for many for whom homeownership was elusive, providing capital for the 
neighborhood grocery and barber shop, financing housing rehabilitation, 
providing consumer credit counseling services, providing jobs, and 
revitalizing communities.
  However, minority-owned financial institutions face many challenges. 
By and large much smaller than other banks, minority banks have 
difficulty competing with larger institutions for deposits and other 
business. It is often difficult to diversify their geographical and 
credit risk exposures. They also face challenges associated with 
operating in economically depressed markets.
  Despite these challenges, minority-owned financial institutions are 
committed to providing

[[Page H14176]]

capital, promoting economic revitalization, and creating jobs. They are 
committed to serving the urban and minority communities in which they 
are located and the people and businesses that reside there. We need 
them.
  Minority-owned financial institutions comprise only about two percent 
of all financial institutions and a significantly lower percentage of 
total industry assets. We must do all that we can to support, protect 
and promote these institutions.
  This bill, H.R. 4043, the Preserving and Expanding Minority 
Depository Institutions Act, is an important step. Existing law 
requires that the Office of Thrift Supervision (OTS) and the Federal 
Deposit Insurance Corporation (FDIC) consult with the Department of the 
Treasury on methods to preserve, encourage and promote minority 
ownership of depository institutions and provide technical assistance, 
training and education programs.
  H.R. 4043 would direct the Chairman of the Board of Governors of the 
Federal Reserve System and the Comptroller of the Currency to help 
preserve, encourage and expand minority-owned financial institutions by 
participating in those activities. In addition, the bill would require 
each of the participating agencies to submit an annual report to the 
Congress on actions taken to implement the law.
  Mr. WATT. Mr. Speaker, I yield back the balance of my time.


 =========================== NOTE =========================== 

  
  On Page H14176, December 05, 2007, the following appeared: Mr. 
WOLF. Mr. Speaker, I yield back the balance of my time.
  
  The online version should be corrected to read: Mr. WATT. Mr. 
Speaker, I yield back the balance of my time.


 ========================= END NOTE ========================= 

  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from North Carolina (Mr. Watt) that the House suspend the 
rules and pass the bill, H.R. 4043, as amended.
  The question was taken; and (two-thirds being in the affirmative) the 
rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

                          ____________________