    [House Report 104-193]
    [From the U.S. Government Publishing Office]

    104th Congress                                                   Report
                            HOUSE OF REPRESENTATIVES

     1st Session                                                    104-193
    _______________________________________________________________________

              FINANCIAL INSTITUTIONS REGULATORY RELIEF ACT OF 1995

     July 18, 1995.--Committed to the Committee of the Whole House on the
                  State of the Union and ordered to be printed

    _______________________________________________________________________

       Mr. Leach, from the Committee on Banking and Financial Services,
                            submitted the following

                                  R E P O R T

                                 together with

                         MINORITY AND ADDITIONAL VIEWS

                            [To accompany H.R. 1858]

          [Including cost estimate of the Congressional Budget Office]
      The Committee on Banking and Financial Services, to whom was
    referred the bill (H.R. 1858) to reduce paperwork and
    additional regulatory burdens for depository institutions,
    having considered the same, report favorably thereon with an
    amendment and recommend that the bill as amended do pass.
      The amendment is as follows:
      Strike out all after the enacting clause and insert in lieu
    thereof the following:
    SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

      (a) Short Title.--This Act may be cited as the ``Financial
    Institutions Regulatory Relief Act of 1995''.
      (b) Table of Contents.--The table of contents for this Act is as
    follows:

    Sec. 1. Short title; table of contents.

                TITLE I--REDUCTIONS IN GOVERNMENT OVERREGULATION

                     Subtitle A--The Home Mortgage Process

    Sec. 101. Regulatory authority over disclosures and escrow accounts
    under RESPA transferred to Federal Reserve Board.
    Sec. 102. Simplification and unification of disclosures required under
    RESPA and TILA for mortgage transactions.
    Sec. 103. Increased regulatory flexibility under the Truth in Lending
    Act.
    Sec. 104. Reductions in RESPA regulatory burdens; clarifying
    amendments.
    Sec. 105. Disclosures for adjustable rate mortgages.
    Sec. 106. Certain charges.
    Sec. 107. Exemptions from rescission.
    Sec. 108. Tolerances; basis of disclosures.
    Sec. 109. Limitation on liability.
    Sec. 110. Limitation on rescission liability.
    Sec. 111. Calculation of damages.
    Sec. 112. Assignee liability.
    Sec. 113. Rescission rights in foreclosure.
    Sec. 114. Recovery of fees.
    Sec. 115. Home ownership debt counseling notification.
    Sec. 116. Home Mortgage Disclosure Act.
    Sec. 117. Applicability.

               Subtitle B--Community Reinvestment Act Amendments

    Sec. 121. Expression of congressional intent.
    Sec. 122. Community Reinvestment Act exemption.
    Sec. 123. Self-certification of CRA compliance.
    Sec. 124. Community input and conclusive rating.
    Sec. 125. Special purpose financial institutions.
    Sec. 126. Increased incentives for lending to low- and moderate-income
    communities.
    Sec. 127. Prohibition on additional reporting under CRA.
    Sec. 128. Technical amendment.
    Sec. 129. Duplicative reporting.
    Sec. 130. CRA congressional oversight.
    Sec. 131. Consultation among examiners.
    Sec. 132. Limitation on regulations.

                      Subtitle C--Consumer Banking Reforms

    Sec. 141. Truth in Savings.
    Sec. 142. Information sharing.
    Sec. 143. Electronic Fund Transfer Act clarification.
    Sec. 144. Limit on restitution for Truth in Lending violations if
    safety and soundness of violator would be affected.

              Subtitle D--Equal Credit Opportunity Act Amendments

    Sec. 151. Short title.
    Sec. 152. Findings and purpose.
    Sec. 153. Equal Credit Opportunity Act amendments.
    Sec. 154. Fair Credit Reporting Act amendments.
    Sec. 155. Incentives for self-testing.
    Sec. 156. Credit scoring systems.
    Sec. 157. Consultation by Attorney General required in nonreferral
    cases.
    Sec. 158. Effective date.

                  Subtitle E--Consumer Leasing Act Amendments

    Sec. 161. Short title.
    Sec. 162. Congressional findings and declaration of purpose.
    Sec. 163. Regulations.
    Sec. 164. Consumer lease advertising.
    Sec. 165. Statutory penalties.

                 Subtitle F--Federal Home Loan Bank Amendments

    Sec. 171. Application for membership in the FHLB System.
    Sec. 172. Federal home loan bank external auditors.

                 TITLE II--STREAMLINING GOVERNMENT REGULATIONS

                     Subtitle A--Regulatory Approval Issues

    Sec. 201. Streamlined nonbanking acquisitions by well capitalized and
    well managed banking organizations.
    Sec. 202. Streamlined bank acquisitions by well capitalized and well
    managed banking organizations.
    Sec. 203. Eliminate filing and approval requirements for insured
    depository institutions already controlled by the same holding company.
    Sec. 204. Eliminate redundant approval requirement for Oakar
    transactions.
    Sec. 205. Elimination of duplicative requirements imposed upon bank
    holding companies and other regulatory relief under the Home Owners'
    Loan Act.
    Sec. 206. Eliminate requirement that approval be obtained for
    divestitures.
    Sec. 207. Eliminate unnecessary branch applications.
    Sec. 208. Eliminate branch applications and requirements for ATMs and
    similar facilities.
    Sec. 209. Eliminate requirement for approval of investments in bank
    premises for well capitalized and well managed banks.
    Sec. 210. Eliminate unnecessary filing for officer and director
    appointments.
    Sec. 211. Streamlining process for determining new nonbanking
    activities.
    Sec. 212. Disposition of foreclosed assets.
    Sec. 213. Increase in certain credit union loan ceilings.

       Subtitle B--Streamlining of Government Regulations; Miscellaneous
                                   Provisions

    Sec. 221. Eliminate the per-branch capital requirement for national
    banks and State member banks.
    Sec. 222. Branch closures.
    Sec. 223. Amendments to the Depository Institutions Management
    Interlocks Act.
    Sec. 224. Acceleration of repayment to Treasury.
    Sec. 225. Eliminate unnecessary and duplicative recordkeeping and
    reporting requirements relating to loans to executive officers and
    permit participation in employee benefit plans.
    Sec. 226. Expanded regulatory discretion for small bank examinations.
    Sec. 227. Cost reimbursement.
    Sec. 228. Identification of foreign nonbank financial institution
    customers.
    Sec. 229. Paperwork reduction review.
    Sec. 230. Daily confirmations for hold-in-custody repurchase
    transactions.
    Sec. 231. Required regulatory review of regulations.
    Sec. 232. Country risk requirements.
    Sec. 233. Audit costs.
    Sec. 234. Standards for director and officer liability.
    Sec. 235. Foreign bank applications.
    Sec. 236. Duplicate examination of foreign banks.
    Sec. 237. Second mortgages.
    Sec. 238. Streamlining FDIC approval of new State bank powers.
    Sec. 239. Repeal of call report attestation requirement.
    Sec. 240. Authority of the Comptroller of the Currency.
    Sec. 241. National bank community development insurance activities.
    Sec. 242. Authorizing bank service companies to organize as limited
    liability partnerships.
    Sec. 243. Bank investments in Edge Act and agreement corporations.
    Sec. 244. Report on the reconciliation of differences between
    regulatory accounting principles and generally accepted accounting
    principles.
    Sec. 245. Waivers authorized for residency requirement for national
    bank directors.

                          TITLE III--LENDER LIABILITY

    Sec. 301. Lender liability.

        TITLE IV--ANNUAL STUDY AND REPORT ON IMPACT ON LENDING TO SMALL
                                    BUSINESS

    Sec. 401. Annual study and report.
                TITLE I--REDUCTIONS IN GOVERNMENT OVERREGULATION

                     Subtitle A--The Home Mortgage Process
    SEC. 101. REGULATORY AUTHORITY OVER DISCLOSURES AND ESCROW ACCOUNTS
                        UNDER RESPA TRANSFERRED TO FEDERAL RESERVE BOARD.

      (a) In General.--Sections 4, 5, 6, and 10(d) of the Real Estate
    Settlement Procedures Act of 1974 (12 U.S.C. 2601 et seq.) are amended
    by striking ``Secretary'' each place such term appears and inserting
    ``Board''.
      (b) Clarification of Purpose.--Section 2(b)(2) of the Real Estate
    Settlement Procedures Act of 1974 (12 U.S.C. 2601(b)(2)) is amended by
    inserting the following before the semicolon at the end: ``without--
                      ``(A) directly regulating settlement services prices;
                    or
                      ``(B) directly regulating wages to bona fide
                    employees that are not designed as a subterfuge to
                    facilitate kickbacks among affiliated companies''.
      (c) Board Defined.--Section 3 of the Real Estate Settlement
    Procedures Act of 1974 (12 U.S.C. 2602) is amended--
              (1) by striking ``and'' at the end of paragraph (7);
              (2) by striking the period at the end of paragraph (8) and
            inserting ``; and''; and
              (3) by adding at the end the following new paragraph:
              ``(9) the term `Board' means the Board of Governors of the
            Federal Reserve System.''.
      (d) Negotiated Regulations Under Sections 8 and 9.--Section 8 of the
    Real Estate Settlement Procedures Act of 1974 (12 U.S.C. 2607) is
    amended by adding at the end the following new subsection:
      ``(e) Negotiated Regulations.--
              ``(1) In general.--The Secretary may not publish a proposed
            or final regulation under this section and section 9 after the
            date of the enactment of the Financial Institutions Regulatory
            Relief Act of 1995 unless the Secretary has used the negotiated
            rulemaking procedure established under subchapter III of
            chapter 5 of title 5, United States Code, to attempt to
            negotiate and develop the rule.
              ``(2) Consistency with purpose.--Any regulation prescribed in
            accordance with paragraph (1) shall be consistent with the
            purposes of this title as set forth in section 2.''.
      (e) Administrative Enforcement of Prohibition Against Kickbacks and
    Unearned Fees.--Section 8 of the Real Estate Settlement Procedures Act
    of 1974 (12 U.S.C. 2607) is amended by adding after subsection (e) (as
    added by subsection (d) of this section) the following new subsection:
      ``(f) Administrative Enforcement.--
              ``(1) In general.--Compliance with the requirements of this
            section and sections 9 and 12 shall be enforced under this
            Act--
                      ``(A) in the case of an insured depository
                    institution (as defined in section 3 of the Federal
                    Deposit Insurance Act), by the appropriate Federal
                    banking agency (as defined in such section);
                      ``(B) in the case of an insured credit union (as
                    defined in section 101(7) of the Federal Credit Union
                    Act), by the National Credit Union Administration;
                      ``(C) in the case of a bank holding company (as
                    defined in section 2 of the Bank Holding Company Act of
                    1956) and any affiliate of any such holding company
                    (other than an insured depository institution), by the
                    Board;
                      ``(D) in the case of a savings and loan holding
                    company (as defined in section 10 of the Home Owners'
                    Loan Act) and any affiliate of any such holding company
                    (other than an insured depository institution), by the
                    Director of the Office of Thrift Supervision; and
                      ``(E) in the case of any other person, by the
                    Secretary.
              ``(2) Special rules relating to determination of appropriate
            regulator.--
                      ``(A) Cases of more than 1 appropriate regulator.--
                    If, under paragraph (1), a company may be regulated by
                    more than 1 agency, the Board shall determine which
                    agency shall be the responsible agency, notwithstanding
                    paragraph (1).
                      ``(B) Cases involving joint ventures, partnerships,
                    and other affiliated business arrangements.--If any
                    insured depository institution is involved in a joint
                    venture, partnership, or other affiliated business
                    arrangement with any person who is not an insured
                    depository institution, the agency responsible for
                    enforcing this section and sections 9 and 12 with
                    respect to such insured depository institution shall be
                    the agency with such responsibility with respect to
                    such joint venture, partnership, or other affiliated
                    business arrangement.
              ``(3) Interagency cooperation and enforcement guidelines.--
            All the agencies referred to in any subparagraph of paragraph
            (1) shall cooperate with each other to develop enforcement
            guidelines and other means for achieving effective compliance
            with this section and sections 9 and 12.
              ``(4) Preference for civil enforcement over criminal
            enforcement.--As part of the cooperative efforts required under
            paragraph (3), the agencies referred to in paragraph (1) shall
            consider means for achieving compliance with this section and
            section 9 through the exercise of administrative enforcement
            authority under this subsection without resorting to criminal
            enforcement actions under subsection (d) except in appropriate
            cases.
              ``(5) Effective date.--Paragraphs (1) and (2) shall not take
            effect until joint interagency cooperation and enforcement
            guidelines are adopted by all the agencies to which paragraphs
            (1) and (2) apply and the enforcement authority of the
            Secretary with respect to this section and sections 9 and 12
            shall continue until such paragraphs take effect.''.
      (f) Increased Scienter Requirement for Criminal Penalty.--Section
    8(d) of the Real Estate Settlement Procedures Act of 1974 (12 U.S.C.
    2607(d)) is amended--
              (1) in paragraph (1), by inserting ``willfully'' after
            ``persons who''; and
              (2) in paragraph (3), by striking ``was not intentional
            and''.
      (g) Redesignation of Controlled Business Arrangements as Affiliated
    Business Arrangements.--The Real Estate Settlement Procedures Act of
    1974 (12 U.S.C. 2601 et seq.) is amended--
              (1) in section 3(7), by striking ``controlled business
            arrangement'' and inserting ``affiliated business
            arrangement''; and
              (2) in subsections (c)(4) and (d)(6) of section 8, by
            striking ``controlled business arrangements'' and inserting
            ``affiliated business arrangements''.
      (h) Technical and Conforming Amendments.--
              (1) Section 4(a) of the Real Estate Settlement Procedures Act
            of 1974 (12 U.S.C. 2603(a)) is amended by striking ``Federal
            Home Loan Bank Board'' and inserting ``Director of the Office
            of Thrift Supervision''.
              (2) Section 8(d)(4) of the Real Estate Settlement Procedures
            Act of 1974 (12 U.S.C. 2607(d)(4)) is amended by inserting
            ``any other agency described in subsection (f)(1),'' after
            ``the Secretary,''.
              (3) Section 10(c)(1)(C) of the Real Estate Settlement
            Procedures Act of 1974 (12 U.S.C. 2609(c)(1)(C)) is amended by
            striking ``Not later than the expiration of the 90-day period
            beginning on the date of the enactment of the Cranston-Gonzalez
            National Affordable Housing Act, the'' and inserting ``The''.
              (4) Section 16 of the Real Estate Settlement Procedures Act
            of 1974 (12 U.S.C. 2614) is amended by striking ``Secretary,''
            and inserting ``Board, an agency referred to in any
            subparagraph of section 8(f)(1),''.
              (5) Section 18 of the Real Estate Settlement Procedures Act
            of 1974 (12 U.S.C. 2616) is amended--
                      (A) by striking ``Secretary is authorized to'' and
                    inserting ``Board and Secretary may jointly'';
                      (B) by striking ``Secretary'' each place such term
                    appears other than the 1st place and inserting ``Board
                    and Secretary''; and
                      (C) by striking ``determines that such laws'' and
                    inserting ``determine that such laws''.
              (6) Section 19(a) of the Real Estate Settlement Procedures
            Act of 1974 (12 U.S.C. 2617(a)) is amended to read as follows:
      ``(a) Regulations.--
              ``(1) In general.--Subject to paragraph (2), the Secretary
            and the Board may prescribe such regulations, make such
            interpretations, and grant such reasonable exemptions for
            classes of transactions, as may be necessary to achieve the
            purposes of this Act.
              ``(2) Application.--
                      ``(A) Board.--The authority of the Board under
                    paragraph (1) shall apply with respect to--
                              ``(i) sections 4, 5, 6, 10, and 12; and
                              ``(ii) sections 3, 7, 17, and 18 to the
                            extent such sections are applicable with
                            respect to the sections described in clause
                            (i).
                      ``(B) Secretary.--The authority of the Secretary
                    under paragraph (1) shall apply with respect to--
                              ``(i) sections 8 and 9; and
                              ``(ii) sections 3, 7, 17, and 18 to the
                            extent such sections are applicable with
                            respect to the sections described in clause
                            (i). ''.
              (7) Section 19(b) of the Real Estate Settlement Procedures
            Act of 1974 (12 U.S.C. 2617(b)) is amended by inserting ``, the
            Board,'' after ``the Secretary''.
              (8) Section 19(c) of the Real Estate Settlement Procedures
            Act of 1974 (12 U.S.C. 2617(c)) is amended--
                      (A) in paragraph (1)--
                              (i) by striking ``Secretary'' the 1st place
                            such term appears and inserting ``Board, with
                            respect to any action to enforce section 4, 5,
                            6, or 10, and each agency referred to in any
                            subparagraph of section 8(f)(1), with respect
                            to any action to enforce section 8, 9, or
                            12,''; and
                              (ii) by striking ``Secretary'' each place
                            such term appears other than the 1st place and
                            inserting ``Board or such other agency''; and
                      (B) in paragraph (2), by striking ``Secretary'' and
                    inserting ``Board or an agency referred to in any
                    subparagraph of section 8(f)(1)''.
              (9) The heading for section 19 of the Real Estate Settlement
            Procedures Act of 1974 (12 U.S.C. 2617) is amended to read as
            follows:

         ``authority of the secretary and the federal reserve board''.

      (i) Repeal of Obsolete Provisions.--The Real Estate Settlement
    Procedures Act of 1974 (12 U.S.C. 2601 et seq.) is amended by striking
    sections 13, 14, and 15.

    SEC. 102. SIMPLIFICATION AND UNIFICATION OF DISCLOSURES REQUIRED UNDER
                        RESPA AND TILA FOR MORTGAGE TRANSACTIONS.

      (a) In General.--With respect to credit transactions which are
    subject to the Real Estate Settlement Procedures Act of 1974 and the
    Truth in Lending Act, the Board of Governors of the Federal Reserve
    System shall take such action as may be necessary before the end of the
    3-month period beginning on the date of the enactment of this Act--
              (1) to simplify the disclosures applicable to such
            transactions under such Acts, including the timing of the
            disclosures; and
              (2) to provide a single format for such disclosures which
            will satisfy the requirements of each such Act with respect to
            such transactions.
      (b) Regulations.--To the extent that it is necessary to prescribe any
    regulation in order to effect any changes required to be made under
    subsection (a), the proposed regulation shall be published in the
    Federal Register before the end of the 3-month period referred to in
    subsection (a).
      (c) Recommendations for Legislation.--If the Board of Governors of
    the Federal Reserve System finds that legislative action may be
    necessary or appropriate in order to simplify and unify the disclosure
    requirements under the Real Estate Settlement Procedures Act of 1974
    and the Truth in Lending Act, the Board shall submit a report
    containing recommendations to the Congress concerning such action.

    SEC. 103. INCREASED REGULATORY FLEXIBILITY UNDER THE TRUTH IN LENDING
                        ACT.
      (a) Regulatory Flexibility.--Section 104 of the Truth in Lending Act
    (15 U.S.C. 1603) is amended by adding at the end the following new
    paragraph:
              ``(7) Transactions for which the Board, by regulation,
            determines that coverage under the Act is not needed to carry
            out the purposes of the Act.''.
      (b) Exemptive Authority.--Section 105 of the Truth in Lending Act (15
    U.S.C. 1604) is amended--
              (1) by redesignating subsections (b), (c), and (d) as
            subsections (c), (d), and (e), respectively; and
              (2) by inserting after subsection (a) the following new
            subsection:
      ``(b) Exemptive Authority.--
              ``(1) In general.--The Board shall exempt from all or parts
            of this title any class of transactions for which, in the
            Board's judgment, coverage under all or part of this title does
            not provide a measurable benefit to consumers in the form of
            useful information or protection.
              ``(2) Factors to be considered.--In determining which classes
            of transactions to exempt in whole or in part, the Board shall
            consider, among other factors, the following:
                      ``(A) The amount of the loan or closing costs and
                    whether the disclosures, right of rescission, and other
                    provisions are necessary, particularly for small loans.
                      ``(B) Whether the requirements of this title
                    complicate, hinder, or make more expensive the credit
                    process for the class of transactions.
                      ``(C) The status of the borrower, including, the
                    borrowers' related financial arrangements, the
                    financial sophistication of the borrower relative to
                    the type of transaction, and the importance of the
                    credit and related supporting property to the
                    borrower.''.

    SEC. 104. REDUCTIONS IN RESPA REGULATORY BURDENS; CLARIFYING
                        AMENDMENTS.

      (a) Unnecessary Disclosure.--Section 6(a) of the Real Estate
    Settlement Procedures Act of 1974 (12 U.S.C. 2605) is amended to read
    as follows:
      ``(a) Disclosure to Applicant Relating to Assignment, Sale, or
    Transfer of Loan Servicing.--
              ``(1) In general.--Each person who makes a federally related
            mortgage loan shall disclose to each person who applies for any
            such loan, at the time of application for the loan, whether the
            servicing of any such loan may be assigned, sold, or
            transferred to any other person at any time while such loan is
            outstanding.
              ``(2) Signature of applicant.--Any disclosure of the
            information required under paragraph (1) shall not be effective
            for purposes of this section unless the disclosure is
            accompanied by a written statement, in such form as the
            Secretary shall develop before the expiration of the 180-day
            period beginning on the date of the enactment of the Financial
            Institutions Regulatory Relief Act of 1995, that the applicant
            has read and understood the disclosure and that is evidenced by
            the signature of the applicant at the place where such
            statement appears in the application.''.
      (b) Effective Date.--The amendments made by subsection (a) shall take
    effect 180 days after the date of the enactment of this Act.
      (c) Second Mortgages.--Section 3(1)(A) of the Real Estate Settlement
    Procedures Act of 1974 (12 U.S.C. 2602(1)(A)) is amended by striking
    ``or subordinate''.
      (d) Consistency of RESPA and Truth in Lending Act Exemption of
    Business Loans.--Section 7 of the Real Estate Settlement Procedures Act
    of 1974 (12 U.S.C. 2606) is amended--
              (1) by inserting ``(a) In General.--'' before ``This Act'';
            and
              (2) by inserting at the end the following new subsection:
      ``(b) Interpretation.--In issuing regulations pursuant to section
    19(a) of this Act, the Board shall ensure that, with regard to
    subsection (a), the exemption for business credit includes all business
    credit which is exempt from the Truth in Lending Act in accordance with
    section 226.3(a) of the regulations prescribed by the Board known as
    `regulation Z' (12 C.F.R. 226.3(a)), as in effect on the date of
    enactment of the Financial Institutions Regulatory Relief Act of
    1995.''.
    SEC. 105. DISCLOSURES FOR ADJUSTABLE RATE MORTGAGES.

      (a) In General.--Section 127A(a)(2)(G) of the Truth in Lending Act
    (15 U.S.C. 1637a(a)(2)(G)) is amended by inserting before the semicolon
    ``, or a statement that the monthly payment may increase or decrease
    significantly due to increases in the annual percentage rate''.
      (b) Technical and Conforming Amendment.--Section 127A(b)(3) of the
    Truth in Lending Act (15 U.S.C. 1637a(b)(3)) is amended by striking
    ``required under'' and inserting ``referred to in''.
      (c) Alternative to Historical Example.--Section 128(a) of the Truth
    in Lending Act (15 U.S.C. 1638(a)) is amended by inserting at the end
    the following new paragraph:
              ``(14) In any variable rate transaction secured by the
            consumer's principal dwelling with a term greater than 1 year,
            at the creditors' option, a statement that the monthly payment
            may increase or decrease substantially, or a historical example
            illustrating the effects of interest rate changes implemented
            according to the loan program.''.
      (d) Ensuring Honoring of Lock-in Promises.--Section 128(b) of the
    Truth in Lending Act (15 U.S.C. 1638(b)) is amended by adding at the
    end the following new paragraph:
      ``(3) In the case of a residential mortgage transaction, the
    disclosures under subsection (a) shall include the following:
              ``(A) The note rate and points, and a statement, if
            applicable, that these terms are subject to change.
              ``(B) A statement that the creditor must include the
            disclosed note rate and points in the credit agreement unless,
            in relation to either or both of those terms--
                      ``(i) the disclosure clearly and conspicuously
                    indicates that the term is subject to change, or
                      ``(ii) in the case of any term to which clause (i)
                    does not apply--
                              ``(I) the creditor has clearly and
                            conspicuously indicated that the term is
                            conditioned on closing the transaction within a
                            prescribed time;
                              ``(II) the creditor has promptly and clearly
                            communicated to the consumer the information
                            and documentation that the consumer is required
                            to provide to the creditor; and
                              ``(III) the consumer has failed to provide
                            such information and documentation within a
                            reasonable time after receiving that
                            communication.''.

    SEC. 106. CERTAIN CHARGES.

      (a) Third Party Fees.--Section 106(a) of the Truth in Lending Act (15
    U.S.C. 1605(a)) is amended by adding after the 2d sentence the
    following new sentence: ``The finance charge shall not include fees and
    amounts imposed by third party closing agents (including settlement
    agents, attorneys, and escrow and title companies) if the creditor does
    not expressly require the imposition of the charges or the services
    provided and does not retain the charges.''.
      (b) Mortgage Broker Fees.--Section 106(a) of the Truth in Lending Act
    (15 U.S.C. 1605(a)) is amended by adding at the end the following new
    paragraph:
              ``(6) Mortgage broker fees.''.
      (c) Treatment of Certain Debt Cancellation and Deficiency Waiver
    Contracts.--Section 106(c) of the Truth in Lending Act (15 U.S.C.
    1605(c)) is amended to read as follows:
      ``(c) Treatment of Certain Debt Cancellation and Deficiency Waiver
    Contracts.--Charges or premiums for any insurance or for any voluntary
    noninsurance product, written in connection with any consumer credit
    transaction, that provides protections against loss of or damage to
    property or against part or all of the debtor's liability for amounts
    in excess of the value of the collateral securing the debtor's
    obligation, or against liability arising out of the ownership or use of
    property, shall be included in the finance charge unless a clear and
    specific statement in writing is furnished by the creditor to the
    person to whom the credit is extended, setting forth the cost of the
    insurance or product if obtained from or through the creditor, and
    stating that the person to whom credit is extended may choose the
    person through which the insurance or product is to be obtained.''.
      (d) Taxes on Security Instruments or Evidences of Indebtedness.--
    Section 106(d) of the Truth in Lending Act (15 U.S.C. 1605(d)) is
    amended by adding at the end the following new paragraph:
              ``(3) Any tax levied on security instruments or on documents
            evidencing indebtedness if the payment of such taxes is a
            precondition for recording the instrument securing the evidence
            of indebtedness.''.
      (e) Preparation of Loan Documents.--Section 106(e)(2) of the Truth in
    Lending Act (15 U.S.C. 1605(e)(2)) is amended to read as follows:
              ``(2) Fees for preparation of loan-related documents and for
            attending or conducting settlement.''.
      (f) Fees Relating to Pest Infestations, Inspections, and Hazards.--
    Section 106(e)(5) of the Truth in Lending Act (15 U.S.C. 1605(e)(5)) is
    amended by inserting ``, including fees related to pest infestations,
    premises and structural inspections, and flood hazards'' before the
    period.
      (g) Ensuring Finance Charges Reflect Cost of Credit.--
              (1) Report.--
                      (A) In general.--Not later than 6 months after the
                    date of the enactment of this Act, the Board of
                    Governors of the Federal Reserve System shall submit to
                    the Congress a report containing recommendations on any
                    regulatory or statutory changes necessary--
                              (i) to ensure that finance charges imposed in
                            connection with consumer credit transactions
                            more accurately reflect the cost of providing
                            credit; and
                              (ii) to address abusive refinancing practices
                            engaged in solely for the purpose of avoiding
                            rescission.
                      (B) Report requirements.--In preparing the report
                    under this paragraph, the Board shall--
                              (i) consider the extent to which it is
                            feasible to include in finance charges all
                            charges payable directly or indirectly by the
                            consumer to whom credit is extended, and
                            imposed directly or indirectly by the creditor
                            as an incident to the extension of credit
                            (especially those charges excluded from finance
                            charges under section 106 of the Truth in
                            Lending Act as of the date of the enactment of
                            this Act), excepting only those charges which
                            are payable in a comparable cash transaction;
                            and
                              (ii) consult with and consider the views of
                            affected industries and consumer groups.
              (2) Regulations.--The Board of Governors of the Federal
            Reserve System shall prescribe any appropriate regulation in
            order to effect any change included in the report under
            paragraph (1), and shall publish the regulation in the Federal
            Register before the end of the 1-year period beginning on the
            date of enactment of this Act.
    SEC. 107. EXEMPTIONS FROM RESCISSION.

      (a) Certain Refinancing.--Section 125(e) of the Truth in Lending Act
    (15 U.S.C. 1635(e)) is amended--
              (1) by striking ``or'' at the end of paragraph (3);
              (2) by striking the period at the end of paragraph (4) and
            inserting ``; or''; and
              (3) by adding at the end the following new paragraph:
              ``(5) a transaction, other than a mortgage referred to in
            section 103(aa), which--
                      ``(A) is a refinancing of the principal balance then
                    due and any accrued and unpaid finance charges of a
                    residential mortgage transaction as defined in section
                    103(w), or is any subsequent refinancing of such a
                    transaction; and
                      ``(B) does not provide any new consolidation or new
                    advance.''.
      (b) Technical and Conforming Amendment.--Section 125(e)(2) of the
    Truth in Lending Act (15 U.S.C. 1635(e)(2)) is amended by inserting ``,
    other than a transaction described in subsection (e)(5),'' after ``a
    refinancing or consolidation (with no new advances)''.
    SEC. 108. TOLERANCES; BASIS OF DISCLOSURES.

      (a) Tolerances for Accuracy.--Section 106 of the Truth in Lending Act
    (15 U.S.C. 1605) is amended by adding at the end the following new
    subsection:
      ``(f) Tolerances for Accuracy.--In connection with credit
    transactions not under an open end credit plan that are secured by real
    property or a dwelling, the disclosure of the finance charge and other
    disclosures affected by any finance charge--
              ``(1) except as provided in paragraph (2), shall be treated
            as being accurate for purposes of this title if the amount
            disclosed as the finance charge--
                      ``(A) does not vary from the actual finance charge by
                    more than an amount equal to \1/2\ of the numerical
                    tolerance corresponding to, and generated by, the
                    tolerance provided by section 107(c) with respect to
                    the annual percentage rate, but in no case may the
                    tolerance under this paragraph be less than $25 or
                    greater than $200; or
                      ``(B) is greater than the amount required to be
                    disclosed under this title; and
              ``(2) shall be treated as being accurate for purposes of
            section 125 if the amount disclosed as the finance charge does
            not vary from the actual finance charge by more than an amount
            equal to 0.5 percent of the total amount of credit extended.''.
      (b) Basis of Disclosure for Per Diem Interest.--Section 121(c) of the
    Truth in Lending Act (15 U.S.C. 1631(c)) is amended by adding at the
    end the following new sentence: ``In the case of any consumer credit
    transaction a portion of the interest on which is determined on a per
    diem basis and is to be collected upon the consummation of such
    transaction, any disclosure with respect to such portion of interest
    shall be deemed to be accurate for purposes of this title if the
    disclosure is based on information actually known to the creditor at
    the time that the disclosure documents are being prepared for the
    consummation of the transaction.''.
    SEC. 109. LIMITATION ON LIABILITY.

      (a) In General.--Chapter 2 of the Truth in Lending Act (15 U.S.C.
    1631 et seq.) is amended by adding at the end the following new
    section:
    ``SEC. 139. CERTAIN LIMITATIONS ON LIABILITY.

      ``(a) Limitations on Liability.--For any consumer credit transaction
    subject to this title that is consummated before the date of the
    enactment of the Financial Institutions Regulatory Relief Act of 1995,
    a creditor or any assignee of a creditor shall have no civil,
    administrative, or criminal liability under this title for, and a
    consumer shall have no extended rescission rights under section 125(f)
    with respect to--
              ``(1) the creditor's treatment, for disclosure purposes, of--
                      ``(A) taxes described in section 106(d)(3);
                      ``(B) fees and amounts described in section 106(e)
                    (2) and (5);
                      ``(C) fees and amounts referred to in the 3rd
                    sentence of section 106(a); or
                      ``(D) mortgage broker fees referred to in section
                    106(a)(6);
              ``(2) the form of written notice used by the creditor to
            inform the obligor of the rights of the obligor under section
            125 if the creditor provided the obligor with a properly dated
            form of written notice published and adopted by the Board or a
            comparable written notice; or
              ``(3) any disclosure relating to the finance charge imposed
            with respect to the transaction if the amount or percentage
            actually disclosed--
                      ``(A) may be treated as accurate pursuant to section
                    106(f), or
                      ``(B) is greater than the amount or percentage
                    required to be disclosed under this title.
      ``(b) Exceptions.--Subsection (a) shall not apply to--
              ``(1) any individual action or counterclaim brought under
            this title which was filed before June 1, 1995;
              ``(2) any class action brought under this title for which a
            final order certifying a class was entered before January 1,
            1995;
              ``(3) the named individual plaintiffs in any class action
            brought under this title which was filed before June 1, 1995;
            or
              ``(4) any consumer credit transaction with respect to which a
            timely notice of rescission was sent to the creditor before
            June 1, 1995.''.
      (b) Clerical Amendment.--The table of sections for chapter 2 of the
    Truth in Lending Act is amended by inserting after the item relating to
    section 138 the following new item:

    ``139. Certain limitations on liability.''.
    SEC. 110. LIMITATION ON RESCISSION LIABILITY.

      Section 125 of the Truth in Lending Act (15 U.S.C. 1635) is further
    amended by adding at the end the following new subsection:
      ``(h) Limitation on Rescission.--An obligor shall have no rescission
    rights arising from the form of written notice used by the creditor to
    inform the obligor of the rights of the obligor under this section, if
    the creditor provided the obligor the appropriate form of written
    notice published and adopted by the Board, or a comparable written
    notice of the rights of the obligor, that was properly completed by the
    creditor.''.
    SEC. 111. CALCULATION OF DAMAGES.

      Section 130(a)(2)(A) of the Truth in Lending Act (15 U.S.C.
    1640(a)(2)(A)) is amended--
              (1) by striking ``or (ii)'' and inserting ``(ii)''; and
              (2) by inserting before the semicolon at the end the
            following: ``, or (iii) in the case of an individual action
            relating to a credit transaction not under an open end credit
            plan that is secured by real property or a dwelling, not less
            than $250 or greater than $2,500''.
    SEC. 112. ASSIGNEE LIABILITY.

      (a) Violations Apparent on the Face of Transaction Documents.--
    Section 131 of the Truth in Lending Act (15 U.S.C. 1641) is amended by
    adding at the end the following new subsection:
      ``(e) Liability of Assignee for Consumer Credit Transactions Secured
    by Real Property.--
              ``(1) In general.--Except as otherwise specifically provided
            in this title, any civil action against a creditor for a
            violation of this title, and any proceeding under section 108
            against a creditor, with respect to a consumer credit
            transaction secured by real property may be maintained against
            any assignee of such creditor only if--
                      ``(A) the violation for which such action or
                    proceeding is brought is apparent on the face of the
                    disclosure statement provided in connection with such
                    transaction pursuant to this title; and
                      ``(B) the assignment to the assignee was voluntary.
              ``(2) Violation apparent on the face of the disclosure
            described.--For the purpose of this section, a violation is
            apparent on the face of the disclosure statement if--
                      ``(A) the disclosure can be determined to be
                    incomplete or inaccurate from the face of the
                    disclosure statement, any itemization of the amount
                    financed, or any other disclosure of disbursement; or
                      ``(B) the disclosure statement does not use the terms
                    or format required to be used by this title.''.
      (b) Servicer Not Treated as Assignee.--Section 131 of the Truth in
    Lending Act (15 U.S.C. 1641) is amended by inserting after subsection
    (e) (as added by subsection (a) of this section) the following new
    subsection:
      ``(f) Treatment of Servicer.--
              ``(1) In general.--A servicer of a consumer obligation
            arising from a consumer credit transaction shall not be treated
            as an assignee of such obligation for purposes of this section
            unless the servicer is the owner of the obligation.
              ``(2) Servicer not treated as owner on basis of assignment
            for administrative convenience.--A servicer of a consumer
            obligation arising from a consumer credit transaction shall not
            be treated as the owner of the obligation for purposes of this
            section on the basis of an assignment of the obligation from
            the creditor or another assignee to the servicer solely for the
            administrative convenience of the servicer in servicing the
            obligation. Upon written request by the obligor, the servicer
            shall provide the obligor, to the best knowledge of the
            servicer, with the name, address, and telephone number of the
            owner of the obligation or the master servicer of the
            obligation.
              ``(3) Servicer defined.--For purposes of this subsection, the
            term `servicer' has the same meaning as in section 6(i)(2) of
            the Real Estate Settlement Procedures Act of 1974.''.

    SEC. 113. RESCISSION RIGHTS IN FORECLOSURE.

      Section 125 of the Truth in Lending Act (15 U.S.C. 1635) is amended
    by inserting after subsection (h) (as added by section 110) the
    following new subsection:
      ``(i) Rescission Rights in Foreclosure.--
              ``(1) In general.--Notwithstanding section 139, and subject
            to the time period provided in subsection (f), in addition to
            any other right of rescission available under this section for
            a transaction, upon an action of a creditor to execute
            foreclosure on the primary dwelling of an obligor securing an
            extension of credit, the obligor shall have a right to rescind
            the transaction equivalent to other rescission rights provided
            by this section, if--
                      ``(A) a mortgage brokers fee is not included in the
                    finance charge in accordance with the laws and
                    regulations in effect at the time the consumer credit
                    transaction was consummated; or
                      ``(B) the form of notice of rescission for the
                    transaction is not the appropriate form of written
                    notice published and adopted by the Board or a
                    comparable written notice, or was not properly
                    completed by the creditor.
              ``(2) Tolerance for disclosures.--Notwithstanding section
            106(f), and subject to the time period provided in subsection
            (f), for the purposes of exercising any rescission rights
            following an action by a creditor to foreclose on the principal
            dwelling of the obligor securing an extension of credit, the
            disclosure of the finance charge and other disclosures affected
            by any finance charge shall be treated as being accurate for
            purposes of this section if the amount disclosed as the finance
            charge does not vary from the actual finance charge by more
            than $35 or is greater than the amount required to be disclosed
            under this title.''.

    SEC. 114. RECOVERY OF FEES.

      Section 125(b) of the Truth in Lending Act (15 U.S.C. 1635) is
    amended--
              (1) in the 1st sentence, by inserting ``, except any charge
            for an appraisal report or credit report'' after ``other
            charge''; and
              (2) in the 2d sentence, by striking ``otherwise'' and
            inserting ``as otherwise required under this subsection''.

    SEC. 115. HOME OWNERSHIP DEBT COUNSELING NOTIFICATION.

      Section 106(c) of the Housing and Urban Development Act of 1968 (12
    U.S.C. 1701x(c)) is amended by striking paragraph (5).

    SEC. 116. HOME MORTGAGE DISCLOSURE ACT.

      (a) Section 309 of the Home Mortgage Disclosure Act of 1975 (12
    U.S.C. 2808) is amended--
              (1) in the 2d sentence, by striking ``$10,000,000'' and
            inserting ``$50,000,000''; and
              (2) by inserting at the end the following new sentences:
            ``The Board may also, by regulation, exempt from the provisions
            of this Act institutions specified in section 303(2)(A) which
            have total assets as of their last full fiscal year of
            $50,000,000 or greater where the burden of complying with this
            Act on such institutions outweighs the usefulness of the
            information required to be disclosed. The exemptions provided
            under this section shall not be applicable to an institution
            which the Board, by order, has found a reasonable basis to
            believe is not fulfilling its obligations to serve the housing
            needs of the communities and neighborhoods in which it located.
            An institution subject to such an order shall be required to
            comply with the requirements of this Act for loans made after
            the time that the order is issued at such time and for such
            period as the Board deems appropriate. The dollar amount in
            this section shall be adjusted annually after December 31,
            1994, by the annual percentage increase in the Consumer Price
            Index for Urban Wage Earners and Clerical Workers published by
            the Bureau of Labor Statistics.''.
      (b) Section 304 of the Home Mortgage Disclosure Act of 1975 (12
    U.S.C. 2803) is amended by adding at the end the following new
    subsection:
      ``(m) Opportunity To Reduce Compliance Burden.--
              ``(1) A depository institution shall be considered to have
            satisfied the public availability requirements of subsection
            (a) if such institution keeps the information required under
            that subsection at its home office and provides notice at the
            branch locations specified in such subsection that such
            information is available upon request from the home office of
            the institution. A home office of the depository institution
            receiving a request for such information pursuant to this
            subsection shall provide the information pertinent to the
            location of the branch in question within fifteen days of the
            receipt of the written request.
              ``(2) In complying with paragraph (1), a depository
            institution may provide the individual requesting such
            information, at the institution's choice, with--
                      ``(A) a paper copy of the information requested; or
                      ``(B) if acceptable to the individual, the
                    information through a form of electronic medium, such
                    as computer disc.''.

    SEC. 117. APPLICABILITY.

      (a) In General.--The amendments made by subsections (a), (d), (e),
    and (f) of section 106 and sections 108, 112, and 113 shall apply to
    all consumer credit transactions in existence or consummated on or
    after the date of enactment of this Act.
      (b) Exception.--Notwithstanding subsection (a), in the case of--
              (1) an individual action or a counterclaim referred to in
            section 139(b)(1) of the Truth in Lending Act, as amended by
            section 109(a) of this Act;
              (2) a class action referred to in section 139(b)(2) of that
            Act;
              (3) a claim of an individual as a named individual plaintiff
            in a class action referred to in section 139(b)(3) of that Act;
            or
              (4) a claim relating to a consumer credit transaction
            referred to in section 139(b)(4) of that Act;
    the Truth in Lending Act shall apply as in effect on the date of the
    consummation of the consumer credit transaction that is the subject of
    the individual action, counterclaim, class action, or claim,
    respectively.

               Subtitle B--Community Reinvestment Act Amendments

    SEC. 121. EXPRESSION OF CONGRESSIONAL INTENT.

      Subsection (b) of section 802 of the Community Reinvestment Act of
    1977 (12 U.S.C. 2901) is amended to read as follows:
      ``(b) It is the purpose of this title to require each appropriate
    Federal financial supervisory agency to use its authority, when
    examining financial institutions, to encourage such institutions to
    help meet the credit needs of the local communities in which they are
    chartered consistent with the safe and sound operation of such
    institutions. When examining financial institutions, a supervisory
    agency shall not impose additional burden, recordkeeping, or reporting
    upon such institutions.''.

    SEC. 122. COMMUNITY REINVESTMENT ACT EXEMPTION.

      The Community Reinvestment Act of 1977 (12 U.S.C. 2901 et seq.) is
    amended by adding at the end the following new section:

    ``SEC. 809. EXAMINATION EXEMPTION.

      ``(a) In General.--A regulated financial institution shall not be
    subject to the examination requirements of this title or any
    regulations issued under this section if the institution and any bank
    holding company which controls such institution have aggregate assets
    of not more than $100,000,000.
      ``(b) Annual Adjustment.--The dollar amount in subsection (a) shall
    be adjusted annually after December 31, 1994, by the annual percentage
    increase in the Consumer Price Index for Urban Wage Earners and
    Clerical Workers published by the Bureau of Labor Statistics.''.

    SEC. 123. SELF-CERTIFICATION OF CRA COMPLIANCE.

      Section 804 of the Community Reinvestment Act of 1977 (12 U.S.C.
    2903) is amended by adding at the end the following new subsection (c):
      ``(c) Self-Certification of CRA Compliance.--
              ``(1) Certification.--In lieu of being evaluated under
            section 806A and receiving a written evaluation under section
            807, a qualifying financial institution may elect to self-
            certify to the appropriate Federal financial supervisory agency
            that such institution is in compliance with the goals of this
            title.
              ``(2) Qualifying institution.--
                      ``(A) In general.--For purposes of paragraph (1), the
                    term `qualifying institution' means a financial
                    institution which--
                              ``(i) has not more than $250 million in
                            assets;
                              ``(ii) has not been found to have engaged in
                            a pattern or practice of illegal discrimination
                            under the Fair Housing Act or the Equal Credit
                            Opportunity Act for the preceding 5-year
                            calendar period; and
                              ``(iii) received rating under section
                            807(b)(2) of `satisfactory' or `outstanding' in
                            the most recent evaluation of such institution
                            under this title.
                      ``(B) Annual adjustment.--The dollar amount in
                    subparagraph (A) shall be adjusted annually after
                    December 31, 1994, by the annual percentage increase in
                    the Consumer Price Index for Urban Wage Earners and
                    Clerical Workers published by the Bureau of Labor
                    Statistics.
              ``(3) Public notice.--
                      ``(A) In general.--A qualifying institution shall
                    maintain in every branch a public notice stating that--
                              ``(i) the institution has self-certified that
                            the institution is satisfactorily helping to
                            meet the credit needs of its community;
                              ``(ii) the institution maintains--
                                      ``(I) at the main office of such
                                    institution, a public file which
                                    contains a copy of the self-
                                    certification to the appropriate
                                    Federal financial supervisory agency;
                                    and
                                      ``(II) a map delineating the
                                    community served by the institution;
                              ``(iii) a list of the types of credit and
                            services that the institution provides to the
                            community served by the institution;
                              ``(iv) such other information that the
                            institution believes demonstrates the
                            institution's record of helping to meet the
                            credit needs of its community; and
                              ``(v) every public comment or letter to the
                            institution (and any response by the
                            institution) received within the previous 2-
                            year period about the record of the institution
                            of helping to meet the credit needs of its
                            community.
                      ``(B) Public file.--A qualifying institution shall
                    maintain a public file containing the contents
                    described in this paragraph at the institution's main
                    office
              ``(4) Rating.--
                      ``(A) In general.--A qualifying institution shall be
                    deemed to have a rating of a `satisfactory record of
                    meeting community credit needs' for the purposes of
                    this section and section 806A(c).
                      ``(B) Publication.--Each Federal financial
                    supervisory agency shall publish in the Federal
                    Register once each month a list of institutions that
                    have self-certified during the previous month.
                      ``(C) Publication constitutes disclosure.--
                    Publication of the name of the institution in the
                    Federal Register as having self-certified shall
                    constitute disclosure of the rating of the institution
                    to the public for purposes of sections 806A and 807.
              ``(5) Regulatory review.--
                      ``(A) Assessment.--During each examination for safety
                    and soundness, a qualifying institution's supervisory
                    agency shall, as part of the agency's review of the
                    institution's loans, assess whether the institution's
                    basis for its self-certification is reasonable based on
                    the public notice and the information contained in the
                    public file pursuant to paragraph (3).
                      ``(B) Examination if self-certification is not
                    reasonable.--If the agency determines that the
                    institution's basis for the institution's self-
                    certification is not reasonable, the agency shall
                    schedule an examination of the institution for the
                    purpose of assessing the institution's record of
                    helping to meet the credit needs of its community.
                      ``(C) Revocation of self-certification.--If an
                    assessment pursuant to subparagraph (B) results in a
                    less than `satisfactory' rating, the agency shall
                    revoke the institution's self-certification and
                    substitute a written evaluation as provided under
                    section 807.
                      ``(D) Period of ineligibility for self-
                    certification.--An institution whose self-certification
                    has been revoked may not self-certify pursuant to this
                    subsection during the 5 years succeeding the year in
                    which the self-certification is revoked.
                      ``(E) Subsequent eligibility.--After the end of the
                    period of ineligibility described in subparagraph (D),
                    an institution which meets the requirements for self-
                    certification may elect to self-certify.
              ``(6) Prohibition on additional requirements.--No appropriate
            Federal financial supervisory agency may impose any additional
            requirements, whether by regulation or otherwise, relating to
            the self-certification procedure under this subsection.''.

    SEC. 124. COMMUNITY INPUT AND CONCLUSIVE RATING.
      (a) Conforming Amendment.--Section 804(a) of the Community
    Reinvestment Act of 1977 (12 U.S.C. 2903) is amended by inserting
    ``conducted in accordance with section 806A,'' after ``financial
    institution,''.
      (b) Community Input and Conclusive Rating.--The Community
    Reinvestment Act of 1977 (12 U.S.C. 2901 et seq.) is amended by
    inserting after section 806 the following new section:

    ``SEC. 806A. COMMUNITY INPUT AND CONCLUSIVE RATING.

      ``(a) Publication of Exam Schedule and Opportunity for Comment.--
              ``(1) Publication of notice.--Each appropriate Federal
            financial supervisory agency shall--
                      ``(A) publish in the Federal Register, 30 days before
                    the beginning of a calendar quarter, a listing of
                    institutions scheduled for evaluation for compliance
                    with this title during such calendar quarter; and
                      ``(B) provide opportunity for written comments from
                    the community on the performance, under this title, of
                    each institution scheduled for evaluation.
              ``(2) Comment period.--Written comments may not be submitted
            to an appropriate Federal financial supervisory agency pursuant
            to paragraph (1) after the end of the 30-day period beginning
            on the first day of the calendar quarter.
              ``(3) Copy of comments.--The agency shall provide a copy of
            such comments to the institution.
      ``(b) Evaluation.--The appropriate Federal financial supervisory
    agency shall--
              ``(1) evaluate the institution in accordance with the
            standards contained in section 804; and
              ``(2) prepare and publish a written evaluation of the
            institution as required under section 807.
      ``(c) Reconsideration of Rating.--
              ``(1) Request for reconsideration.--A reconsideration of an
            institution's rating referred to in section 807(b)(1)(C), may
            be requested within 30 days of the rating's disclosure to the
            public.
              ``(2) Procedures for request.--Any such request shall be made
            in writing and filed with the appropriate Federal financial
            supervisory agency, and may be filed by the institution or a
            member of the community.
              ``(3) Basis for request.--Any request for reconsideration
            under this subsection shall be based on significant issues of a
            substantive nature which are relevant to the delineated
            community of the institution and, in the case of a request by a
            member of the community, shall be limited to issues previously
            raised in comments submitted pursuant to subsection (a).
              ``(4) Completion of review.--The appropriate Federal
            financial supervisory agency shall complete any requested
            reconsideration within 30 days of the filing of the request.
      ``(d) Conclusive Rating.--
              ``(1) In general.--An institution's rating shall become
            conclusive on the later of--
                      ``(A) 30 days after the rating is disclosed to the
                    public; or
                      ``(B) the completion of any requested reconsideration
                    by the Federal financial supervisory agency.
              ``(2) Rating conclusive of meeting community credit needs.--
            An institution's rating shall be the conclusive assessment of
            the institution's record of meeting the credit needs of its
            community for purposes of section 804 until the institution's
            next rating, developed pursuant to an examination, becomes
            conclusive.
              ``(3) Safe harbor.--Institutions which have received a
            `satisfactory' or `outstanding' rating shall be deemed to have
            met the purposes of section 804.
              ``(4) Rule of construction.--Notwithstanding any other
            provision of law, no provision of this section shall be
            construed as granting a cause of action to any person.''.
      (c) Overall Evaluation of Institution.--Paragraph (2) of section
    804(a) of the Community Reinvestment Act of 1977 (12 U.S.C. 2903(a)) is
    amended to read as follows:
              ``(2) take such record into account in the overall evaluation
            of the condition of the institution by the appropriate Federal
            financial supervisory agency.''.

    SEC. 125. SPECIAL PURPOSE FINANCIAL INSTITUTIONS.

      (a) In General.--Section 804 of the Community Reinvestment Act of
    1977 (12 U.S.C. 2903) is amended by inserting after subsection (c) (as
    added by section 123 of this title) the following new subsection:
      ``(d) Special Purpose Institutions.--
              ``(1) In general.--In conducting assessments pursuant to this
            section at any special purpose institution, the appropriate
            Federal financial supervisory agency shall--
                      ``(A) consider the nature of business such
                    institution is involved in; and
                      ``(B) assess and take into account the record of the
                    institution commensurate with the amount of deposits
                    (as defined in section 3(1) of the Federal Deposit
                    Insurance Act) received by such institution.
              ``(2) Standards.--Each appropriate Federal financial
            supervisory agency shall develop standards under which special
            purpose institutions may be deemed to have complied with the
            requirements of this title which are consistent with the
            specific nature of such businesses.''.
      (b) Special Purpose Institution Defined.--Section 803 of the
    Community Reinvestment Act of 1977 (12 U.S.C. 2902) is amended by
    adding at the end the following new paragraph:
              ``(5) Special purpose institutions.--The term `special
            purpose institution' means a financial institution that does
            not generally accept deposits from the public in amounts of
            less than $100,000, such as wholesale, credit card, and trust
            institutions.''.
    SEC. 126. INCREASED INCENTIVES FOR LENDING TO LOW- AND MODERATE-INCOME
                        COMMUNITIES.

      (a) In General.--Section 804(b) of the Community Reinvestment Act of
    1977 (12 U.S.C. 2903(b)) is amended to read as follows:
      ``(b) Positive Consideration of Certain Loans and Investments.--In
    assessing and taking into account the records of a regulated financial
    institution under subsection (a), the appropriate Federal financial
    supervisory agency shall--
              ``(1) consider as a positive factor, consistent with the safe
            and sound operation of the institution, the institution's
            investment in or loan to--
                      ``(A) any minority depository institution or women's
                    depository institution (as such terms are defined in
                    section 808(b)) or any low-income credit union;
                      ``(B) any joint venture or other entity or project
                    which promotes the public welfare in any distressed
                    community (as defined by such agency) whether or not
                    the distressed community is located in the local
                    community in which the regulated financial institution
                    is chartered to do business; and
                      ``(C) targeted low- and moderate-income communities,
                    including real property loans to such communities; and
              ``(2) consider equally with other factors capital investment,
            loan participation, and other ventures undertaken by the
            institution in cooperation with--
                      ``(A) minority- and women-owned financial
                    institutions and low-income credit unions to the extent
                    that these activities help meet the credit needs of the
                    local communities in which such institutions are
                    chartered; and
                      ``(B) community development corporations in extending
                    credit and other financial services principally to low-
                    and moderate-income persons and small businesses to the
                    extent that such community development corporations
                    help meet the credit needs of the local communities
                    served by the majority-owned institution.''.
      (b) Amendment to Definitions.--Section 803 of the Community
    Reinvestment Act of 1977 (12 U.S.C. 2902) is amended by inserting after
    paragraph (5) (as added by section 125(b) of this subtitle) the
    following new paragraph:
              ``(6) State bank supervisor.--The term `State bank
            supervisor' has the same meaning as in section 3(r) of the
            Federal Deposit Insurance Act.''.
      (c) Technical Correction.--The 1st of the 2 paragraphs designated as
    paragraph (2) of section 803 of the Community Reinvestment Act of 1977
    (12 U.S.C. 2902) is amended to read as follows:
                      ``(D) the Director of the Office of Thrift
                    Supervision with respect to any savings association
                    (the deposits of which are insured by the Federal
                    Deposit Insurance Corporation) and any savings and loan
                    holding company (other than a company which is a bank
                    holding company);''.

    SEC. 127. PROHIBITION ON ADDITIONAL REPORTING UNDER CRA.

      Section 806 of the Community Reinvestment Act of 1977 (12 U.S.C.
    2905) is amended to read as follows:

    ``SEC. 806. REGULATIONS.

      ``(a) In General.--
              ``(1) Publication requirement.--Regulations to carry out the
            purposes of this title shall be published by each appropriate
            Federal financial supervisory agency.
              ``(2) Prohibition on additional recordkeeping.--Regulations
            prescribed and policy statements, commentary, examiner
            guidance, or other supervisory material issued under this title
            shall not impose any additional recordkeeping on a financial
            institution.
              ``(3) Prohibition on loan data collection.--No loan data may
            be required to be collected and reported by a financial
            institution and no such data may be made public by any Federal
            financial supervisory agency under this title.''.

    SEC. 128. TECHNICAL AMENDMENT.

      Section 807(b)(1)(B) of the Community Reinvestment Act (12 U.S.C.
    2906) is amended by striking ``The information'' and inserting ``In the
    case of a regulated financial institution that maintains domestic
    branches in 2 or more States, the information''.

    SEC. 129. DUPLICATIVE REPORTING.
      Section 10(g) of the Federal Home Loan Bank Act (12 U.S.C. 1430(g))
    is amended by adding at the end the following new paragraph (3):
              ``(3) Special rule.--This subsection shall not apply to
            members receiving a grade of `outstanding' or `satisfactory'
            under section 807 of the Community Reinvestment Act of 1977.''.
    SEC. 130. CRA CONGRESSIONAL OVERSIGHT.

      (a) Sense of Congress Relating to Aggressive Oversight.--It is the
    sense of the Congress that the appropriate committees of the House of
    Representatives and the Senate should exercise aggressive oversight of
    the adoption and implementation of any regulation by any appropriate
    Federal financial supervisory agency under the Community Reinvestment
    Act of 1977 after the date of the enactment of this Act.
      (b) Agency Reports Required.--
              (1) In general.--Each appropriate Federal financial
            supervisory agency shall submit a report to the Congress by
            December 31, 1996, and by December 31, 1997, on the
            implementation of all regulations prescribed by such agency
            under the Community Reinvestment Act of 1977 after the date of
            the enactment of this Act.
              (2) Requirements relating to preparation of reports.--In
            preparing each report required under paragraph (1), each
            appropriate Federal financial supervisory agency shall--
                      (A) solicit and include comments from regulated
                    financial institutions with respect to the regulations
                    which are the subject of the report; and
                      (B) include quantifiable measures of the cost savings
                    achieved under the regulations which are the subject of
                    the report and the effectiveness of such regulations in
                    achieving the purposes of the Community Reinvestment
                    Act of 1977.
              (3) Definitions.--For purposes of this section, the terms
            ``appropriate Federal financial supervisory agency'' and
            ``regulated financial institution'' have the same meanings as
            in section 803 of the Community Reinvestment Act of 1977.
    SEC. 131. CONSULTATION AMONG EXAMINERS.

      Section 10 of the Federal Deposit Insurance Act (12 U.S.C. 1820) is
    amended by adding at the end the following new subsection:
      ``(j) Consultation Among Examiners.--
              ``(1) In general.--Each appropriate Federal banking agency
            shall take such action as may be necessary to ensure that
            examiners employed by the agency--
                      ``(A) consult on examination activities with respect
                    to any depository institution; and
                      ``(B) achieve an agreement and resolve any
                    inconsistencies on the recommendations to be given to
                    such institution as a consequence of any examinations.
              ``(2) Examiner-in-charge.--Each agency shall consider
            appointing an examiner-in-charge with respect to a depository
            institution to ensure consultation on examination activities
            among all of the agency's examiners involved in examinations of
            such institution.''.
    SEC. 132. LIMITATION ON REGULATIONS.

      Section 806 of the Community Reinvestment Act of 1977 (12 U.S.C.
    2905) (as amended by section 127) is amended by adding at the end the
    following new subsections:
      ``(b) Limitation on Regulations.--No regulation may be prescribed
    under this title by any Federal agency which would--
              ``(1) require any regulated financial institution to--
                      ``(A) make any loan or enter into any other agreement
                    on the basis of any discriminatory criteria prohibited
                    under any law of the United States; or
                      ``(B) make any loan to, or enter into any other
                    agreement with, any uncreditworthy person that would
                    jeopardize the safety and soundness of such
                    institution; or
              ``(2) prevent or hinder in any way a financial institution's
            full responsibility to provide credit to all segments of the
            community.
      ``(c) Encourage Loans to Creditworthy Borrowers.--Regulations
    prescribed under this title shall encourage regulated financial
    institutions to make loans and extend credit to all creditworthy
    persons, consistent with safety and soundness.''.

                      Subtitle C--Consumer Banking Reforms

    SEC. 141. TRUTH IN SAVINGS.

      (a) Purpose.--Section 262 of the Truth in Savings Act (12 U.S.C.
    4301) is amended to read as follows:

    ``SEC. 262. PURPOSE.

      ``It is the purpose of this subtitle to ensure that consumers can
    make a meaningful comparison between the competing claims of depository
    institutions with regard to deposit accounts by requiring that
    institutions offering interest-bearing accounts pay interest on the
    full amount of principal each day in a consumer deposit account at the
    rate agreed to be paid by the institution.''.
      (b) Prohibition on Misleading or Inaccurate Advertisements and
    Disclosures.--Section 263 is amended to read as follows:

    ``SEC. 263. PROHIBITION ON MISLEADING OR INACCURATE ADVERTISEMENTS AND
                        DISCLOSURES.

      ``No depository institution or deposit broker shall make any
    advertisement, announcement, solicitation or disclosure relating to a
    deposit account that is inaccurate or misleading, including any
    inaccurate or misleading description of a free or no-cost account, or
    that misrepresents its deposit contracts.''.
      (c) Account Information Upon Opening an Account.--Section 264 of the
    Truth in Savings Act (12 U.S.C. 4304) is amended to read as follows:

    ``SEC. 264. ACCOUNT INFORMATION.

      ``(a) In General.--Each depository institution shall disclose fees,
    charges, penalties, and interest rates applicable to each class of
    accounts offered by the institution in accordance with this section.
      ``(b) Information on Fees and Charges.--Each depository institution
    shall disclose the following information with respect to any account to
    a consumer at the time the account is opened, or at such earlier time
    as a consumer may request (and no additional information may be
    required to be disclosed under this subtitle by regulation or otherwise
    with respect to such account):
              ``(1) A description of all fees, periodic service charges,
            penalties, and interest rates which may be charged or assessed
            against the account (or against the account holders in
            connection with such account), the amount of any such fees,
            charges, or penalties (or the method by which such amount will
            be calculated), and the conditions under which any such amount
            will be assessed.
              ``(2) All minimum balance requirements that affect fees,
            charges, and penalties, including a clear description of how
            each such minimum balance is calculated.
              ``(3) Any minimum amount required with respect to the initial
            deposit in order to open the account.
      ``(c) Information on Interest Rates.--The disclosures required under
    subsections (a) and (b) with respect to any account shall include the
    following information:
              ``(1) Any annual rate of simple interest.
              ``(2) The frequency with which interest will be compounded
            and credited.
      ``(d) No Regulations Authorized.--No regulations may be prescribed
    with respect to this section by the Board or any agency referred to in
    this title, including any regulation to define any terms used in this
    section.''.
      (d) Disclosure of Change in Terms.--Section 265 of the Truth in
    Savings Act (12 U.S.C. 4304) is amended to read as follows:

    ``SEC. 265. DISCLOSURE OF CHANGE IN TERMS.

      ``If any change is made in any item required to be disclosed under
    section 264, all account holders who may be affected by such change
    shall be notified by mail and provided with a description of such
    change at least 30 days before the effective date of the change.''.
      (e) Repeal of Sections.--Sections 266, 268, 271, and 273 of the Truth
    in Savings Act (12 U.S.C. 4304, 4305, 4307, 4310, and 4312,
    respectively) are hereby repealed.
      (f) Redesignation of Sections.--Section 267, 270, 272 of the Truth in
    Savings Act (12 U.S.C. 4306, 4309, and 4311) are redesignated as
    sections 266, 268, and 269, respectively.
      (g) Redesignation and Amendment of Section 269.--Section 269 of the
    Truth in Savings Act (12 U.S.C. 4308) (as determined before the
    redesignation made by subsection (f) of this section) is amended to
    read as follows:
    ``SEC. 267. REGULATIONS.

      ``(a) In General.--The Board, after consultation with each agency
    referred to in section 268(a) and public notice and opportunity for
    comment, shall prescribe regulations to carry out the purpose and
    provisions of this subtitle.
      ``(b) Effective Date of Regulations.--The provisions of this subtitle
    shall not apply with respect to any depository institution before the
    effective date of regulations prescribed by the Board under this
    subsection.''
      (h) Redesignation and Amendment of Section 274.--Section 274 of the
    Truth in Savings Act (12 U.S.C. 4313) is amended to read as follows:

    ``SEC. 270. DEFINITIONS.

      ``For the purposes of this subtitle, the following definitions shall
    apply:
              ``(1) Accounts.--The term `account' means any account
            intended for use by and generally used by a consumer primarily
            for personal, family, or household purposes that is offered by
            a depository institution.
              ``(2) Deposit broker.--The term `deposit broker'--
                      ``(A) has the meaning given to such term in section
                    29(f)(1) of the Federal Deposit Insurance Act; and
                      ``(B) includes any person who solicits any amount
                    from any other person for deposit in an insured
                    depository institution.
              ``(3) Depository institution.--The term `depository
            institution'--
                      ``(A) means an institution described in clause (i),
                    (ii), (iii), (iv), (v), or (vi) of section 19(b)(1)(A)
                    of the Federal Reserve Act; and
                      ``(B) does not include nonautomated credit unions
                    which were not required to comply with the requirements
                    of this title as of the date of the enactment of the
                    Financial Institutions Regulatory Relief Act of 1995
                    pursuant to the determination of the National Credit
                    Union Administration Board.
              ``(4) Interest.--The term `interest' includes dividends paid
            with respect to share accounts which are accounts within the
            meaning of paragraph (1).
              ``(5) Board.--The term `Board' means the Board of Governors
            of the Federal Reserve System.''.
      (i) Effective Date.--
              (1) In general.--The amendments made by this section shall
            take effect on the effective date of regulations prescribed by
            the Board of Governors of the Federal Reserve System to
            implement such amendments.
              (2) Authority to issue regulations.--Notwithstanding
            paragraph (1), the Board of Governors of the Federal Reserve
            System shall prescribe regulations in accordance with the
            amendment made by subsection (g).
              (3) Continued applicability of provisions until effective
            date of new regulations.--The Truth in Savings Act, as in
            effect on the day before the date of the enactment of this Act,
            shall continue to apply on and after such date until the
            effective date of the amendments to such Act under this
            section.

    SEC. 142. INFORMATION SHARING.

      Section 18 of the Federal Deposit Insurance Act (12 U.S.C. 1828) is
    amended by adding at the end the following new subsection:
      ``(s) Customer Access to Products.--
              ``(1) In general.--Notwithstanding any other provision of
            law, any depository institution, or any affiliate or subsidiary
            of any depository institution, may share or exchange
            information or otherwise transfer information between or among
            themselves without any restriction or limitation if it is
            clearly and conspicuously disclosed that the information may be
            communicated among such persons and the consumer is given the
            opportunity, before the time that the information is initially
            communicated, to direct that such information not be
            communicated among such persons.
              ``(2) Definition.--For purposes of this subsection, the term
            `information' means any and all data, records, or other
            information and material obtained or maintained by any
            depository institution or any affiliate or subsidiary thereof
            in the ordinary course of its business that relates in any way
            to a person (as such term is defined in section 603(b) of the
            Fair Credit Reporting Act) who applies for, maintains, or has
            maintained an account or credit relationship with or applied
            for, purchased or obtained other products or services from any
            depository institution or any affiliate or subsidiary of any
            depository institution, regardless of the source or manner in
            which the information is obtained or furnished.
              ``(3) Rule of construction.--Any depository institution, or
            any affiliate or subsidiary of any depository institution,
            relying on this subsection shall not be deemed to be a consumer
            reporting agency, user, or third party, and the information
            itself shall not constitute a consumer report, within the
            meaning of the Fair Credit Reporting Act or other similar
            law.''.
    SEC. 143. ELECTRONIC FUND TRANSFER ACT CLARIFICATION.

      (a) Definition of Accepted Card or Other Means of Access.--Section
    903(1) of the Electronic Fund Transfer Act (15 U.S.C. 1693a(1)) is
    amended by inserting before the semicolon at the end the following: ``,
    but such term does not include a card, device, or computer that a
    person may use to pay for transactions through use of value stored on,
    or assigned to, the card, device, or computer itself, except for those
    transactions where such card, device, or computer is actually used to
    access an account to effect such transaction''.
      (b) Definition of Account.--Section 903(2) of the Electronic Fund
    Transfer Act (15 U.S.C. 1693a(2)) is amended by inserting before the
    semicolon at the end the following: ``and does not include any value
    which is stored on, or assigned to, a card, device, or computer itself
    that enables a person to pay for transactions through use of that
    stored value''.
    SEC. 144. LIMIT ON RESTITUTION FOR TRUTH IN LENDING VIOLATIONS IF
                        SAFETY AND SOUNDNESS OF VIOLATOR WOULD BE AFFECTED.

      Section 108(e)(3)(A) of the Truth in Lending Act (15 U.S.C.
    1607(e)(3)(A)) is amended--
              (1) by striking ``in any such case, the agency may require''
            and inserting ``in any such case, the agency may (i) require'';
              (2) by striking ``, except that with respect to any
            transaction consummated after the effective date of section 608
            of the Truth in Lending Simplification and Reform Act, the
            agency shall'' and inserting ``; or (ii)''; and
              (3) by striking ``reasonable,'' and inserting ``reasonable
            if, in the case of an agency referred to in paragraph (1), (2),
            or (3) of subsection (a), the agency determines that a partial
            adjustment or the making of partial payments over an extended
            period is necessary to avoid causing the creditor to become
            undercapitalized (as determined in accordance with regulations
            prescribed by such agency under section 38 of the Federal
            Deposit Insurance Act);''.

              Subtitle D--Equal Credit Opportunity Act Amendments

    SEC. 151. SHORT TITLE.

      This subtitle may be cited as the ``Equal Credit Opportunity Act
    Amendments of 1995''.

    SEC. 152. FINDINGS AND PURPOSE.

      (a) Findings.--The Congress finds that both the Equal Credit
    Opportunity Act (15 U.S.C. 1691, et seq.) and the Fair Credit Reporting
    Act (15 U.S.C. 1681, et seq.) contain requirements that applicants for
    consumer credit be given certain information in the event that adverse
    action is taken on the application. These requirements differ in both
    scope and content and for that reason are confusing to both the
    consumer who receives the information and the party required to furnish
    the information.
      (b) Purpose.--It is the purpose of this subtitle to combine and
    simplify the adverse action notification requirements of the Equal
    Credit Opportunity Act and the Fair Credit Reporting Act regarding
    applications for consumer credit and to make the information that is
    required to be furnished more understandable.

    SEC. 153. EQUAL CREDIT OPPORTUNITY ACT AMENDMENTS.

      (a) Notice of Adverse Action.--Section 701(d)(2)(B) of the Equal
    Credit Opportunity Act (15 U.S.C. 1691(d)(2)(B)) is amended to read as
    follows:
                      ``(B) giving written notification of adverse action
                    which discloses--
                              ``(i) the applicant's right to a statement of
                            reasons within 30 days after receipt by the
                            creditor of a request made within 60 days after
                            such notification;
                              ``(ii) if credit is denied or the charge for
                            such credit is increased either wholly or
                            partly because of information contained in a
                            consumer report from a consumer reporting
                            agency--
                                      ``(I) that fact and the name,
                                    address, and telephone number of the
                                    consumer reporting agency making the
                                    report;
                                      ``(II) the consumer's right to
                                    obtain, under section 612, a free copy
                                    of a consumer report on the consumer,
                                    from the consumer reporting agency
                                    referred to in subclause (I) within the
                                    30-day period provided under such
                                    section; and
                                      ``(III) the consumer's right to
                                    dispute, under section 611, with a
                                    consumer reporting agency the accuracy
                                    or completeness of any information in a
                                    consumer report furnished by the
                                    agency.
                              ``(iii) if credit is denied or the charge for
                            credit is increased either wholly or partly
                            because of information obtained from a person
                            other than a consumer reporting agency bearing
                            upon the consumer's credit worthiness, credit
                            standing, credit capacity, character, general
                            reputation, personal characteristics or mode of
                            living, that fact and the right to receive
                            disclosure of the nature of the information so
                            received, within a reasonable period of time,
                            upon the consumer's written request for
                            information within 60 days after learning of
                            such adverse action; and
                              ``(v) the identity of the person or office
                            from which such notification may be obtained.
                    Such statement of reasons may be given orally if the
                    written notification advises the applicant of his right
                    to have the statement of reasons confirmed in writing
                    on written request.''.
      (b) Technical and Conforming Amendment.--Section 701(d)(3) of the
    Equal Credit Opportunity Act (15 U.S.C. 1691(d)(3)) is amended by
    striking the period at the end and adding the following: ``and, to the
    extent applicable, the name, address, and telephone number of the
    consumer reporting agency identified in accordance with the
    requirements of subsection (d)(3)(ii) and a statement of the right to
    obtain disclosure of the nature of the information upon which adverse
    action was taken as required by such subsection.''.
      (c) Reasonable Procedures to Assure Compliance.--Section 706 of the
    Equal Credit Opportunity Act (15 U.S.C. 1691e) is amended by adding at
    the end the following new subsection:
      ``(l) Reasonable Procedures To Assure Compliance.--No person shall be
    held liable for any violation of subsection 701(d) if such person shows
    by a preponderance of the evidence that at the time of the alleged
    violation the person maintained reasonable procedures to assure
    compliance with the provisions of the subsection.''.

    SEC. 154. FAIR CREDIT REPORTING ACT AMENDMENTS.

      (a) Section 615(a) of the Fair Credit Reporting Act (15 U.S.C.
    1681m(a)) is amended by striking ``credit or'' each place such term
    appears.
      (b) Section 615 of the Fair Credit Reporting Act (15 U.S.C. 1681m) is
    amended by striking subsection (b) and redesignating subsection (c) as
    subsection (b).
      (c) Section 615(b) (as redesignated by this section) of the Fair
    Credit Reporting Act (15 U.S.C. 1681m(b)) is amended by striking
    ``subsections (a) and (b)'' and inserting ``subsection (a)''.
    SEC. 155. INCENTIVES FOR SELF-TESTING.

      (a) Equal Credit Opportunity.--
              (1) In general.--The Equal Credit Opportunity Act (15 U.S.C.
            1691 et seq.) is amended by inserting after section 704 the
            following new section:

    ``SEC. 704A. INCENTIVES FOR SELF-TESTING AND SELF-CORRECTION.

      ``(a) In General.--If a creditor--
              ``(1) conducts, or authorizes an independent third party to
            conduct, a self-test of the creditor's lending or any part of
            the creditor's lending operations in order to determine the
            level or effectiveness of compliance with this title by the
            creditor; and
              ``(2) has identified discriminatory practices and has taken
            or is taking appropriate corrective actions to address the
            discrimination,
    any report or results of such a self-test may not be obtained or used
    by any applicant, department, or agency in any proceeding or civil
    action brought under this title.
      ``(b) Results of Self-Testing.--No provision of this section shall be
    construed as preventing an applicant, department, or agency from
    obtaining and using the results of any self-testing in any proceeding
    or civil action brought under this title if--
              ``(1) the creditor or any other entity conducted such
            activity at the request of a department or agency;
              ``(2) the creditor or any other entity, or any person acting
            on behalf of the creditor or other entity--
                      ``(A) voluntarily releases or discloses all, or any
                    part of, such results; or
                      ``(B) refers to or describes such results as a
                    defense to charges of unlawful discrimination against
                    such creditor, person, or entity; or
              ``(3) the results are sought by the applicant, department, or
            agency by means of a discovery request for the purposes of
            determining an appropriate penalty or remedy for a violation of
            this title.
      ``(c) Regulations.--The appropriate Federal department or agency
    shall prescribe regulations, after notice and opportunity for comment,
    which determine what types of `self-tests' are sufficiently extensive
    so as to constitute a determination of the level or effectiveness of a
    creditor's compliance with this title.''.
              (2) Referrals to the attorney general.--Section 706(g) of the
            Equal Credit Opportunity Act (15 U.S.C. 1691e(g)) is amended--
                      (A) by striking ``(g) The agencies'' and inserting
                    ``(g) Referrals to the Attorney General.--
              ``(1) In general.--The agencies''; and
                      (B) by adding at the end the following new
                    paragraphs:
              ``(2) Limitation on referrals of self-testing results.--
                      ``(A) In general.--No agency shall be required to
                    refer any report or results of a self-test relating to
                    any creditor to the Attorney General if the creditor--
                              ``(i) has already identified discriminatory
                            practices as the result of self-testing
                            instituted by the creditor to determine
                            compliance with this title; and
                              ``(ii) has taken or is taking appropriate
                            corrective actions to address the
                            discrimination.
              ``(3) Enforcement under other laws.--No provision of this
            section shall be construed as limiting the authority of the
            agency to enforce the provisions of this title under any other
            provision of law.''.
              (3) Referrals to hud.--Section 706(k) of the Equal Credit
            Opportunity Act (15 U.S.C. 1691e(k)) is amended by adding at
            the end the following: ``No such agency shall be required to
            notify the Secretary of Housing and Urban Development or the
            applicant that the agency has reason to believe that a
            violation of this title or the Fair Housing Act occurred if the
            reason is based on a result of self-testing instituted by the
            creditor to determine compliance with this title, and the
            creditor has already identified the possible violation and has
            taken or is taking appropriate corrective actions to address
            the possible violation. No provisions of this section shall be
            construed as limiting the authority of the agency to enforce
            the provisions of this title under any other provision of
            law.''.
              (4) Clerical amendment.--The table of sections for title VII
            of the Consumer Credit Protection Act is amended by inserting
            after the item relating to section 704 the following new item:

    ``704A. Incentives for self-testing and self-correction.''.

      (b) Fair Housing.--The Fair Housing Act (42 U.S.C. 3601 et seq.) is
    amended by inserting after section 814 the following new section:

    ``SEC. 814A. SELF-TESTING ENHANCEMENT.

      ``(a) In General.--If any person--
              ``(1) conducts, or authorizes an independent third party to
            conduct, a self-test of that person's residential real estate
            related lending activities, or any part of such activities, in
            order to determine the level or effectiveness of compliance
            with this title by the person; and
              ``(2) has identified discriminatory practices and has taken
            or is taking appropriate corrective actions to address the
            discrimination,
    any report or results of such a self-test may not be obtained or used
    by any aggrieved person, complainant, department, or agency in any
    proceeding or civil action brought under this title.
      ``(b) Results of Self-Testing.--No provision of this section shall be
    construed as preventing an aggrieved person, complainant, department,
    or agency from obtaining and using the results of any self-testing as
    described in subsection (a) in any proceeding or civil action brought
    under this title if--
              ``(1) the creditor or any other entity conducted such
            activity at the request of a department or agency;
              ``(2) the creditor or any other entity, or any person acting
            on behalf of the creditor or other entity--
                      ``(A) voluntarily releases or discloses all, or any
                    part of, such results; or
                      ``(B) refers to or describes such results as a
                    defense to charges of unlawful discrimination against
                    such creditor, person, or entity; or
              ``(3) the results are sought by the aggrieved person,
            complainant, department, or agency by means of a discovery
            request for the purposes of determining an appropriate penalty
            or remedy for a violation of this title.
      ``(c) Regulations.--The appropriate Federal department or agency
    shall prescribe regulations, after notice and opportunity for comment,
    which determine what types of `self-tests' are sufficiently extensive
    so as to constitute a determination of the level or effectiveness of a
    creditor's compliance with this title.''.

    SEC. 156. CREDIT SCORING SYSTEMS.

      Section 701 of the Equal Credit Opportunity Act (15 U.S.C. 1691) is
    amended by adding at the end the following new subsection:
      ``(f) Credit Scoring System.--
              ``(1) In general.--A creditor shall be deemed to be in
            compliance with subsection (a) with respect to any credit
            decision made by the creditor which is based solely on the use
            of an empirically derived, demonstrably and statistically
            sound, credit scoring system (as defined by the Board in
            regulations prescribed under this title) if such system--
                      ``(A) does not utilize any category protected under
                    subsection (a);
                      ``(B) does not use as a factor in such system any
                    criterion which is so directly associated with such a
                    category as to be the functional equivalent of such a
                    category; and
                      ``(C) does not use as a factor in such system any
                    criterion that has a disparate impact on a category
                    protected under subsection (a) unless use of the
                    criterion is justified by business necessity and there
                    is no less discriminatory alternative available.
              ``(2) Age as a factor.--No provision of this subsection shall
            be construed as precluding a creditor from using age as a
            factor in a credit scoring system under paragraph (1) to the
            extent otherwise permitted under this title.''.
    SEC. 157. CONSULTATION BY ATTORNEY GENERAL REQUIRED IN NONREFERRAL
                        CASES.

      (a) Equal Credit Opportunity.--Section 706(h) of the Equal Credit
    Opportunity Act (15 U.S.C. 1691e(h)) is amended by adding at the end
    the following new sentence: ``Before bringing a civil action against
    any creditor described in paragraph (1), (2), or (3) of section 704(a),
    the Attorney General shall consult with the appropriate agency under
    such paragraph.''.
      (b) Fair Housing Act.--Section 814(a) of the Fair Housing Act (42
    U.S.C. 3614(a)) is amended by adding at the end the following new
    sentence: ``Before bringing a civil action under the preceding sentence
    against any person or group of persons described in paragraph (1), (2),
    or (3) of section 704(a) of the Equal Credit Opportunity Act with
    respect to a violation of 805(a) of this title, the Attorney General
    shall consult with the appropriate agency under such paragraph.''.

    SEC. 158. EFFECTIVE DATE.
      (a) In General.--Except with respect to the requirements of
    subsection (b), this Act shall take effect at the end of the 270-day
    period beginning on the date of the enactment of this Act.
      (b) Implementing Regulations.--The Board of Governors of the Federal
    Reserve System shall prescribe regulations to implement this Act and
    such regulations shall be published in final form before the end of the
    180-day period beginning on the date of the enactment of this Act.

                  Subtitle E--Consumer Leasing Act Amendments

    SEC. 161. SHORT TITLE.

      This subtitle may be cited as the ``Consumer Leasing Act Amendments
    of 1995''.

    SEC. 162. CONGRESSIONAL FINDINGS AND DECLARATION OF PURPOSE.

      (a) Findings.--The Congress finds the following:
              (1) Competition among the various financial institutions and
            other firms engaged in the business of consumer leasing is
            greatest when there is informed use of leasing. The informed
            use of leasing results from an awareness of the cost of leasing
            by consumers.
              (2) There has been a continued trend toward leasing
            automobiles and other durable goods for consumer use as an
            alternative to installment credit sales and that leasing
            product advances have occurred such that lessors have been
            unable to provide consistent industry-wide disclosures to fully
            account for the competitive progress that has occurred.
      (b) Purposes.--
              (1) It is the purpose of this subtitle to assure a simple,
            meaningful disclosure of leasing terms so that the consumer
            will be able to compare more readily the various leasing terms
            available to the consumer and avoid the uninformed use of
            leasing, and to protect the consumer against inaccurate and
            unfair leasing practices.
              (2) To provide for adequate cost disclosures that reflect the
            marketplace without impairing competition and the development
            of new leasing products, it is the purpose of this subtitle to
            provide the Board with the regulatory authority to assure a
            simplified, meaningful definition and disclosure of the terms
            of certain leases of personal property for personal, family, or
            household purposes so as to enable the lessee to compare more
            readily the various lease terms available to the lessee, enable
            comparison of lease terms with credit terms where appropriate
            and to assure meaningful and accurate disclosures of lease
            terms in advertisements.

    SEC. 163. REGULATIONS.

      (a) In General.--Chapter 5 of title I of the Consumer Credit
    Protection Act (15 U.S.C. 1601 et seq.) is amended by adding at the end
    the following new section:

    ``SEC. 187. REGULATIONS.

      ``(a) Regulations Authorized.--
              ``(1) In general.--The Board shall write regulations or staff
            commentary, if appropriate, to update and clarify the
            requirements and definitions for lease disclosures, contracts,
            and any other specific issues related to consumer leasing which
            would carry out the purposes of this chapter, to prevent any
            circumvention of the chapter, and to facilitate compliance with
            the requirements of the chapter.
              ``(2) Classifications, adjustments.--The regulations
            prescribed under paragraph (1) may contain classifications and
            differentiations and may provide for adjustments and exceptions
            for any class of transaction.
      ``(b) Model Disclosures.--The Board shall publish model disclosure
    forms and clauses to facilitate compliance with the disclosure
    requirements and to aid the consumer in understanding the transaction.
    In designing forms, the Board shall consider the use by lessors of data
    processing or similar automated equipment. Use of the models shall be
    optional. A lessor who properly uses the material aspects of the models
    shall be deemed to be in compliance with the disclosure requirements.
      ``(c) Effective Dates.--
              ``(1) In general.--Any regulation of the Board, or any
            amendment or interpretation of any regulation of the Board,
            that requires a disclosure different from the disclosures
            previously required shall have an effective date of the October
            1 that follows the date of promulgation by at least 6 months.
              ``(2) Longer period.--The Board may, in the Board's
            discretion, lengthen the period of time referred to in
            paragraph (1) to permit lessors to adjust their forms to
            accommodate new requirements.
              ``(3) Shorter period.--The Board may also shorten the period
            of time referred to in paragraph (1) if the Board makes a
            specific finding that such action is necessary to comply with
            the findings of a court or to prevent unfair or deceptive
            practices.
              ``(4) Compliance before effective date.--Lessors may comply
            with any newly promulgated disclosure requirement before the
            effective date of such requirement.''.
      (b) Clerical Amendment.--The table of sections for chapter 5 of title
    I of the Consumer Credit Protection Act (15 U.S.C. 1601 et seq.) is
    amended by inserting after the item relating to section 186 the
    following new item:

    ``187. Regulations.''.
    SEC. 164. CONSUMER LEASE ADVERTISING.

      Section 184 of the Consumer Credit Protection Act (15 U.S.C. 1667c)
    is amended to read as follows:

    ``SEC. 184. CONSUMER LEASE ADVERTISING.

      ``(a) In General.--If an advertisement for a consumer lease states
    the amount of any payment or states that any or no initial payment is
    required, the advertisement must also clearly and conspicuously state
    the following terms, as applicable:
              ``(1) That the transaction advertised is a lease.
              ``(2) The total of initial payments required at or before
            consummation of the lease or delivery of the property,
            whichever is later.
              ``(3) That a security deposit is required.
              ``(4) The number, amounts, and timing of scheduled payments.
              ``(5) For a lease in which the consumer's liability at the
            end of the lease term is based on the anticipated residual
            value of the property, that an extra charge may be imposed at
            the end of the lease term.
      ``(b) Advertising Medium Not Liable.--Any owner or personnel of any
    medium in which an advertisement appears or through which it is
    disseminated shall not be liable under this section.''.
    SEC. 165. STATUTORY PENALTIES.

      Section 185(a) of the Consumer Credit Protection Act (15 U.S.C.
    1667d(a)) is amended by adding at the end the following new sentence:
    ``Notwithstanding the preceding sentence, a creditor shall only have
    liability determined under section 130(a)(2) for failing to comply with
    the requirements of paragraph (2), (8), (9), or (10) of section 182 or
    for failing to comply with disclosure requirements under State law for
    any term which the Board has determined to be substantially the same in
    meaning under section 186 as any of the terms referred to in section
    182.''.

                 Subtitle F--Federal Home Loan Bank Amendments

    SEC. 171. APPLICATION FOR MEMBERSHIP IN THE FHLB SYSTEM.

      Section 4(b) of the Federal Home Loan Bank Act (12 U.S.C. 1424) is
    amended to read as follows:
      ``(b) Membership Based on Conveniency.--An institution eligible to
    become a member of a Federal home loan bank under this section may
    become a member by submitting the institution's application for
    membership to the bank in the district where the applicant's principal
    place of business is located. An application for membership shall be
    approved by the bank if, in the judgment of the bank, the applicant
    meets the criteria for eligibility contained in this section. An
    institution eligible to become a member under this section may apply
    for membership in an adjoining district, if appropriate for the
    convenience of the institution and then only with the approval of the
    Board.''.

    SEC. 172. FEDERAL HOME LOAN BANK EXTERNAL AUDITORS.

      Section 11(j) of the Federal Home Loan Bank Act (12 U.S.C. 1431(j))
    is amended to read as follows:
      ``(j) Audits.--
              ``(1) Notwithstanding any other provision of law, audits by
            the Comptroller General of the United States of the financial
            transactions of a Federal home loan bank shall not be limited
            to periods during which Government capital has been invested in
            the bank. The provisions of section 9107(c)(2) and 9108(d)(1)
            of title 31, of such Code, shall not apply to any Federal home
            loan bank.
              ``(2) Notwithstanding any other provision of law, the Board
            shall not participate in the hiring of an external auditor by
            the banks; except, that the Board may establish requirements
            for external audit contracts and, that all 12 banks shall
            contract for an annual audit with a single provider.''.

                 TITLE II--STREAMLINING GOVERNMENT REGULATIONS

                     Subtitle A--Regulatory Approval Issues

    SEC. 201. STREAMLINED NONBANKING ACQUISITIONS BY WELL CAPITALIZED AND
                        WELL MANAGED BANKING ORGANIZATIONS.

      (a) Notice Requirements.--Section 4(j) of the Bank Holding Company
    Act of 1956 (12 U.S.C. 1843(j) is amended--
              (1) in paragraph (1)(A), by striking ``No'' and inserting
            ``Except as provided in paragraph (3), no''; and
              (2) by adding at the end the following new paragraphs:
              ``(3) No notice required for certain transactions.--No notice
            under paragraph (1) or subsections (c)(8) or (a)(2)(B) is
            required for a proposal by a bank holding company to engage in
            any activity or acquire the shares or assets of any company if
            the proposal qualifies under paragraph (4).
              ``(4) Criteria for statutory approval.--A proposal qualifies
            under this paragraph if all of the following criteria are met:
                      ``(A) Financial criteria.--Both before and
                    immediately after the proposed transaction--
                              ``(i) the acquiring bank holding company is
                            well capitalized;
                              ``(ii) the lead insured depository
                            institution of such holding company is well
                            capitalized;
                              ``(iii) well capitalized insured depository
                            institutions control at least 80 percent of the
                            aggregate total risk-weighted assets of insured
                            depository institutions controlled by such
                            holding company; and
                              ``(iv) no insured depository institution
                            controlled by such holding company is
                            undercapitalized.
                      ``(B) Managerial criteria.--
                              ``(i) Well managed.--At the time of the
                            transaction, the acquiring bank holding
                            company, its lead insured depository
                            institution, and insured depository
                            institutions that control at least 90 percent
                            of the aggregate total risk-weighted assets of
                            insured depository institutions controlled by
                            such holding company are well managed.
                              ``(ii) Limitation on poorly managed
                            institutions.--Except with respect to insured
                            depository institutions described in paragraph
                            (6), no insured depository institution
                            controlled by the acquiring bank holding
                            company has received 1 of the 2 lowest
                            composite ratings at the later of the
                            institution's most recent examination or
                            subsequent review.
                      ``(C) Activities permissible.--Following consummation
                    of the proposal, the bank holding company engages
                    directly or through a subsidiary solely in--
                              ``(i) activities that are permissible under
                            subsection (c)(8), as determined by the Board
                            by regulation or order thereunder, subject to
                            all of the restrictions, terms and conditions
                            of such subsection and such regulation or
                            order; and
                              ``(ii) such other activities as are otherwise
                            permissible under this section, subject to the
                            restrictions, terms and conditions, including
                            any prior notice or approval requirements,
                            provided in this section.
                      ``(D) Size of acquisition.--
                              ``(i) Asset size.--The book value of the
                            total assets to be acquired does not exceed 10
                            percent of the consolidated total risk-weighted
                            assets of the acquiring bank holding company;
                            and
                              ``(ii) Consideration.--The gross
                            consideration to be paid for the securities or
                            assets does not exceed 15 percent of the
                            consolidated Tier 1 capital of the acquiring
                            bank holding company.
                      ``(E) Notice not otherwise warranted.--For proposals
                    described in paragraph (5)(B), the Board has not,
                    before the conclusion of the period provided in
                    paragraph (5)(B), advised the bank holding company that
                    a notice under paragraph (1) is required.
                      ``(F) Compliance criterion.--During the 12-month
                    period ending on the date on which the bank holding
                    company proposes to commence an activity or
                    acquisition, no administrative enforcement action has
                    been commenced, and no cease and desist order has been
                    issued pursuant to section 8 of the Federal Deposit
                    Insurance Act, against the bank holding company or any
                    depository institution subsidiary of the holding
                    company and no such enforcement action, order, or other
                    administrative enforcement proceeding is pending as of
                    such date.
              ``(5) Notification.--
                      ``(A) Commencement of activities approved by rule.--A
                    bank holding company that qualifies under paragraph (4)
                    and that proposes to engage de novo, directly or
                    through a subsidiary, in any activity that is
                    permissible under subsection (c)(8), as determined by
                    the Board by regulation, may commence that activity
                    without prior notice to the Board and must provide
                    written notification to the Board no later than ten
                    business days after commencing the activity.
                      ``(B) Activities permitted by order and
                    acquisitions.--
                              ``(i) In general.--At least 12 business days
                            before commencing any activity pursuant to
                            paragraph (3) (other than an activity described
                            in subparagraph (A)) or acquiring shares or
                            assets of any company pursuant to paragraph
                            (3), the bank holding company shall provide
                            written notice of the proposal to the Board,
                            unless the Board determines that no notice or a
                            shorter notice period is appropriate.
                              ``(ii) Description of activities and terms.--
                            A notification under this subparagraph shall
                            include a description of the proposed
                            activities and the terms of any proposed
                            acquisition.
              ``(6) Recently acquired institutions.--Insured depository
            institutions which have been acquired by a bank holding company
            during the 12-month period preceding the date on which the
            company proposes to commence an activity or acquisition
            pursuant to paragraph (3) may be excluded for purposes of
            paragraph (4)(B)(ii) if--
                      ``(A) the bank holding company has developed a plan
                    for the institution to restore the capital and
                    management of the institution which is acceptable to
                    the appropriate Federal banking agency; and
                      ``(B) all such insured depository institutions
                    represent, in the aggregate, less than 10 percent of
                    the aggregate total risk-weighted assets of all insured
                    depository institutions controlled by the bank holding
                    company.
              ``(7) Adjustment of percentages.--The Board may, by
            regulation, adjust the percentages and the manner in which the
            percentages of insured depository institutions are calculated
            under paragraph (4)(B)(i), (4)(D), or paragraph (6)(B) if the
            Board determines that any such adjustment is consistent with
            safety and soundness and the purposes of this Act.''.
      (b) Definitions.--Section 2(o) of the Bank Holding Company Act of
    1956 (12 U.S.C. 1841(o)) is amended--
              (1) by striking paragraph (1) and inserting the following new
            paragraph:
              ``(1) Capital terms.--
                      ``(A) Insured depository institutions.--With respect
                    to insured depository institutions, the terms `well-
                    capitalized', `adequately capitalized', and
                    `uncapitalized' have the meaning given those terms in
                    section 38(b) of the Federal Deposit Insurance Act.
                      ``(B) Bank holding company.--
                              ``(i) Adequately capitalized.--The term
                            `adequately capitalized' means a level of
                            capitalization which meets or exceeds all
                            applicable Federal regulatory capital
                            standards.
                              ``(ii) Well capitalized.--A bank holding
                            company is `well capitalized' if it meets the
                            required capital levels for well capitalized
                            bank holding companies established by the
                            Board.
                      ``(C) Other capital terms.--The terms `Tier 1' and
                    `risk-weighted assets' have the meaning given those
                    terms in the capital guidelines or regulations
                    established by the Board for bank holding companies.'';
                    and
              (2) by adding at the end the following new paragraphs:
              ``(8) Lead insured depository institutions.--
                      ``(A) In general.--The term `lead insured depository
                    institution' means the largest insured depository
                    institution controlled by the bank holding company at
                    any time, based on a comparison of the average total
                    risk-weighted assets controlled by each insured
                    depository institution during the previous 12-month
                    period.
                      ``(B) Branch or agency.--For purposes of this
                    paragraph and section 4(j)(4), the term `insured
                    depository institution' shall also include any branch
                    or agency operated in the United States by a foreign
                    bank.
              ``(9) Well managed.--The term `well managed' means--
                      ``(A) in the case of any company or depository
                    institution which receives examinations, the
                    achievement of--
                              ``(i) a CAMEL composite rating of 1 or 2 (or
                            an equivalent rating under an equivalent rating
                            system) in connection with the most recent
                            examination or subsequent review of such
                            company or institution; and
                              ``(ii) at least a satisfactory rating for
                            management, if such rating is given; or
                      ``(B) in the case of a company or depository
                    institution that has not received an examination
                    rating, the existence and use of managerial resources
                    which the Board determines are satisfactory.''.

    SEC. 202. STREAMLINED BANK ACQUISITIONS BY WELL CAPITALIZED AND WELL
                        MANAGED BANKING ORGANIZATIONS.

      Section 3 of the Bank Holding Company Act (12 U.S.C. 1842) is amended
    by adding at the end the following new subsection:
      ``(h) No Approval Required for Certain Transactions.--
              ``(1) In general.--Notwithstanding paragraph (3) or (5) of
            subsection (a) and subject to paragraphs (5) and (6), an
            acquisition of shares by a registered bank holding company, or
            a merger or consolidation between registered bank holding
            companies, shall be deemed approved at the conclusion of the
            period specified in subparagraph (G) if all of the following
            conditions have been met:
                      ``(A) Financial and managerial criteria.--
                              ``(i) Well capitalized bank holding
                            company.--Both at the time of and immediately
                            after the proposed transaction, the acquiring
                            bank holding company is well capitalized.
                              ``(ii) Well capitalized lead insured
                            depository institution.--Both at the time of
                            and immediately after the proposed transaction,
                            the lead insured depository institution of the
                            acquiring bank holding company is well
                            capitalized.
                              ``(iii) Capital of other insured depository
                            institutions.--At the time of the transaction,
                            well capitalized insured depository
                            institutions control at least 80 percent of the
                            aggregate total risk-weighted assets of insured
                            depository institutions controlled by the
                            acquiring bank holding company.
                              ``(iv) No undercapitalized insured depository
                            institutions.--At the time of the transaction,
                            no insured depository institution controlled by
                            the acquiring bank holding company is
                            undercapitalized.
                              ``(v) Well managed.--
                                      ``(I) In general.--At the time of the
                                    transaction, the acquiring bank holding
                                    company, its lead insured depository
                                    institution, and insured depository
                                    institutions that control at least 90
                                    percent of the aggregate total risk-
                                    weighted assets of insured depository
                                    institutions controlled by such holding
                                    company are well managed.
                                      ``(II) No poorly managed
                                    institutions.--Except with respect to
                                    insured depository institutions
                                    described in paragraph (2), no insured
                                    depository institution controlled by
                                    the acquiring bank holding company has
                                    received 1 of the 2 lowest composite
                                    ratings at the later of the
                                    institution's most recent examination
                                    or subsequent review.
                      ``(B) No unsatisfactory cra ratings.--Except with
                    respect to insured depository institutions described in
                    paragraph (3), no insured depository institution
                    controlled by the acquiring bank holding company has
                    received a `needs to improve' or `substantial
                    noncompliance' composite rating as a result of the
                    institution's most recent examination under the
                    Community Reinvestment Act of 1977.
                      ``(C) Competitive criteria.--Consummation of the
                    proposal complies with guidelines established by the
                    Board by regulation, after consultation with the
                    Attorney General, that identify proposals that are not
                    likely to have a significantly adverse effect on
                    competition in any relevant market.
                      ``(D) Size of acquisition.--
                              ``(i) Asset size.--The book value of the
                            total assets to be acquired does not exceed 10
                            percent of the consolidated total risk weighted
                            assets of the acquiring bank holding company.
                              ``(ii) Consideration.--The gross
                            consideration to be paid for the securities or
                            assets does not exceed 15 percent of the
                            consolidated Tier 1 capital of the acquiring
                            bank holding company.
                      ``(E) Interstate acquisitions.--Board approval of the
                    transaction is not prohibited under subsection (d).
                      ``(F) Compliance criterion.--During the 12-month
                    period ending on the date of the transaction, no
                    administrative enforcement action has been commenced,
                    and no cease and desist order has been issued pursuant
                    to section 8 of the Federal Deposit Insurance Act,
                    against any bank holding company involved in the
                    transaction or any depository institution subsidiary of
                    any such holding company and no such enforcement
                    action, order, or other administrative enforcement
                    proceeding is pending as of such date.
                      ``(G) Other considerations.--Board approval of the
                    transaction is not prohibited under subsection (c)(3).
                      ``(H) Notification.--The acquiring bank holding
                    company provides written notice of the transaction,
                    including a description of the terms of the
                    transaction, to the Board and the Attorney General,
                    simultaneously, at least 15 business days (or such
                    shorter period as permitted by the Board) before the
                    transaction is consummated.
                      ``(I) No board disapproval.--Before the end of the
                    15-day period (or the shorter period) referred to in
                    subparagraph (H), the Board has not required an
                    application under subsection (a).
              ``(2) Special rule relating to the requirement for well
            managed institutions.--Insured depository institutions which
            have been acquired by a bank holding company during the 12-
            month period preceding the date of the transaction may be
            excluded for purposes of paragraph (1)(A)(v)(II) if--
                      ``(A) the bank holding company has developed a plan
                    for the institution to restore the capital and
                    management of the institution which is acceptable to
                    the appropriate Federal banking agency; and
                      ``(B) all such insured depository institutions
                    represent, in the aggregate, less than 10 percent of
                    the aggregate total risk-weighted assets of all insured
                    depository institutions controlled by the holding
                    company.
              ``(3) Special rule relating to the requirement for community
            investment.--Insured depository institutions acquired during
            the 12-month period preceding the date of the transaction may
            be excluded for purposes of paragraph (1)(B) if the bank
            holding company has developed a plan to restore the performance
            of the institution to at least a `satisfactory' rating under
            the Community Reinvestment Act of 1977 which is acceptable to
            the appropriate Federal banking agency.
              ``(4) Adjustment of percentages.--The Board may by regulation
            adjust the percentages and the manner in which the percentages
            of insured depository institutions are calculated under
            subparagraph (A)(v)(I) or (D) of paragraph (1) or paragraph
            (2)(B) if the Board determines that such adjustment is
            consistent with safety and soundness and the purposes of this
            Act.
              ``(5) Advice of attorney general.--The Attorney General shall
            advise the Board during the period referred to in paragraph
            (1)(H) in writing if any competitive concerns exist with
            respect to the transaction.
              ``(6) Waiver of postapproval waiting period.--If the Attorney
            General advises the Board that no competitive concerns exist
            with respect to the transaction, the provisions of section
            11(b) relating to a postapproval waiting shall not apply with
            respect to such transaction.''.

    SEC. 203. ELIMINATE FILING AND APPROVAL REQUIREMENTS FOR INSURED
                        DEPOSITORY INSTITUTIONS ALREADY CONTROLLED BY THE
                        SAME HOLDING COMPANY.

      (a) Bank Merger Act.--Section 18(c) of the Federal Deposit Insurance
    Act (12 U.S.C. 1828(c)) is amended by adding at the end the following
    new paragraph:
              ``(12) The provisions of this subsection shall not apply to
            any merger, consolidation, acquisition of assets or assumption
            of liabilities involving only insured depository institutions
            that are subsidiaries of the same depository institution
            holding company if--
                      ``(A) the responsible agency would not be prohibited
                    from approving the transaction under section 44, if
                    applicable;
                      ``(B) the acquiring, assuming, or resulting
                    institution complies with all applicable provisions of
                    section 44, if any, as if the merger, consolidation, or
                    acquisition were approved under this subsection;
                      ``(C) the acquiring, assuming, or resulting
                    institution provides written notification of the
                    transaction to the appropriate Federal banking agency
                    for the institution at least 10 days prior to
                    consummation of the transaction; and
                      ``(D) after receiving such notice, the agency does
                    not require the institution to submit an application
                    with respect to such transaction and so notifies the
                    institution.''.
      (b) National Bank Consolidation and Merger Act.--
              (1) Consolidations.--Section 2 of the National Bank
            Consolidation and Merger Act (12 U.S.C. 215) is amended--
                      (A) in subsection (a), by adding at the end the
                    following new sentence:
    ``No approval by the Comptroller of the Currency is required under this
    subsection for a transaction which involves the consolidation of banks
    that, at the time of the consolidation, are all subsidiaries (as
    defined in section 3 of the Federal Deposit Insurance Act) of the same
    company.''; and
                      (B) in subsection (b)--
                              (i) by striking ``, and thereafter the
                            consolidation shall be approved by the
                            Comptroller''; and
                              (ii) by striking ``when such consolidation is
                            approved by the Comptroller''.
              (2) Mergers.--Section 3 of the National Bank Consolidation
            and Merger Act (12 U.S.C. 215a) is amended--
                      (A) in subsection (a), by adding at the end the
                    following new sentence:
    ``No approval by the Comptroller of the Currency is required under this
    subsection for a transaction which involves the merger of banks that,
    at the time of the merger, are all subsidiaries (as defined in section
    3 of the Federal Deposit Insurance Act) of the same company.''; and
                      (B) in subsection (b)--
                              (i) by striking ``, and thereafter the merger
                            shall be approved by the Comptroller''; and
                              (ii) by striking ``when such merger shall be
                            approved by the Comptroller''.

    SEC. 204. ELIMINATE REDUNDANT APPROVAL REQUIREMENT FOR OAKAR
                        TRANSACTIONS.

      (a) In General.--Section 5(d)(3) of the Federal Deposit Insurance Act
    (12 U.S.C. 1815(d)(3)) is amended--
              (1) in subparagraph (A), by striking ``with the prior written
            approval of the responsible agency under section 18(c)(2)'';
              (2) in subparagraph (E)--
                      (A) by striking clause (iv) and inserting the
                    following new clause:
                              ``(iv) A transaction shall not be authorized
                            under this paragraph unless the acquiring,
                            assuming, or resulting depository institution
                            will meet all applicable capital requirements
                            upon consummation of the transaction.'';
                      (B) by striking clauses (i) and (ii); and
                      (C) by redesignating clauses (iii) and (iv) (as
                    amended by subparagraph (A) of this paragraph) as
                    clauses (i) and (ii), respectively; and
              (3) by striking subparagraph (G) and redesignating the
            subsequent subparagraphs accordingly.
      (b) Technical and Conforming Amendment.--Section 5156A(b)(1) of the
    Revised Statutes of the United States (12 U.S.C. 215c(b)(1)) is amended
    by striking ``section 5(d)(3) of the Federal Deposit Insurance Act
    or''.
      (c) Clerical Amendment.--The heading for section 5(d)(3)(E) of the
    Federal Deposit Insurance Act (12 U.S.C. 1815(d)(3)(E)) is amended by
    striking ``for approval, generally''.
    SEC. 205. ELIMINATION OF DUPLICATIVE REQUIREMENTS IMPOSED UPON BANK
                        HOLDING COMPANIES AND OTHER REGULATORY RELIEF UNDER
                        THE HOME OWNERS' LOAN ACT.

      (a) Exemption for Bank Holding Companies.--Section 10 of the Home
    Owners' Loan Act (12 U.S.C. 1467a) is amended by adding at the end the
    following new subsection:
      ``(t) Exemption for Bank Holding Companies.--This section shall not
    apply to a bank holding company that is subject to the Bank Holding
    Company Act of 1956 or any company controlled by such bank holding
    company (other than a savings association).''.
      (b) Definition of Savings and Loan Holding Company.--Section
    10(a)(1)(D) of the Home Owners' Loan Act (12 U.S.C. 1467a(a)(1)(D)) is
    amended to read as follows:
                      ``(D) Savings and loan holding company.--
                              ``(i) In general.--Except as provided in
                            clause (ii), the term `savings and loan holding
                            company' means any company which directly or
                            indirectly controls a savings association or
                            controls any other company which is a savings
                            and loan holding company.
                              ``(ii) Exception for bank holding company.--
                            The term `savings and loan holding company'
                            does not include any company which is
                            registered under, and subject to, the
                            provisions of the Bank Holding Company Act of
                            1956, or any company directly or indirectly
                            controlled by such company.''.
      (c) Amendments to the Bank Holding Company Act of 1956.--Section 4(i)
    of the Bank Holding Company Act of 1956 (12 U.S.C. 1843(i)) is amended
    by adding at the end the following new paragraphs:
              ``(4) Solicitation of views.--
                      ``(A) Notice to director.--Upon receiving any
                    application or notice by a bank holding company to
                    acquire directly or indirectly a savings association
                    under subsection (c)(8), the Board shall solicit the
                    Director's comments and recommendations with respect to
                    such acquisition.
                      ``(B) Comment period.--The comments and views of the
                    Director under subparagraph (A) with respect to any
                    acquisition subject to such subparagraph shall be
                    transmitted to the Board within 30 days of the receipt
                    by the Director of the notice relating to such
                    acquisition (or such shorter period as the Board may
                    specify if the Board advises the Director that an
                    emergency exists which requires expeditious action).
              ``(5) Examination.--
                      ``(A) Scope.--The Board shall consult with the
                    Director, as appropriate, in establishing the scope of
                    an examination by the Board of a bank holding company
                    that controls directly or indirectly a savings
                    association.
                      ``(B) Access to inspection reports.--Upon the request
                    of the Director, the Board shall furnish the Director
                    with a copy of any inspection report, additional
                    examination materials, or supervisory information
                    relating to any bank holding company which directly or
                    indirectly controls a savings association.
              ``(6)  Coordination of enforcement efforts.--The Board and
            the Director shall cooperate in any enforcement action against
            any bank holding company which controls a savings association,
            if the relevant conduct involves such association.
              ``(7) Director defined.--For purposes of this section, the
            term `Director' means the Director of the Office of Thrift
            Supervision.''.
      (d) Alternative Test.--Section 10(m) of the Home Owners' Loan Act (12
    U.S.C. 1467a(m)) is amended--
              (1) in paragraph (1), by striking ``(2) and (7)'' and
            inserting ``(2), (7), and (8)''; and
              (2) by adding at the end the following new paragraph:
              ``(8) Alternative test.--Any savings association which meets
            the requirements set forth in section 7701(a)(19)(C) of the
            Internal Revenue Code of 1986 shall be deemed to be a qualified
            thrift lender and any qualified thrift lender shall be deemed
            to meet the requirements of such section.''.

    SEC. 206. ELIMINATE REQUIREMENT THAT APPROVAL BE OBTAINED FOR
                        DIVESTITURES.

      Section 2(g) of the Bank Holding Company Act of 1956 (12 U.S.C.
    1841(g)) is amended--
              (1) by striking paragraph (3);
              (2) by inserting ``and'' after the semicolon at the end of
            paragraph (1); and
              (3) by striking ``; and'' at the end of paragraph (2) and
            inserting a period.

    SEC. 207. ELIMINATE UNNECESSARY BRANCH APPLICATIONS.

      (a) National Bank Branch Applications.--Section 5155(i) of the
    Revised Statutes (12 U.S.C. 36(i)) is amended--
              (1) by striking ``(i) No branch'' and inserting ``(i)
            Relocation.--
              ``(1) Approval required.--Except as provided in paragraph
            (2), no branch''; and
              (2) by adding at the end the following new paragraphs:
              ``(2) No approval required for certain branches.--
            Notwithstanding this subsection or subsection (b) or (c), the
            consent and approval of the Comptroller of the Currency shall
            not be required for a national bank to establish and operate,
            or to retain and operate, a branch or seasonal agency if--
                      ``(A) the bank is well capitalized (as defined in
                    section 38 of the Federal Deposit Insurance Act and
                    regulations prescribed by the Comptroller of the
                    Currency under such section);
                      ``(B) the bank received a composite CAMEL rating of
                    `1' or `2' under the Uniform Financial Institutions
                    Rating System (or an equivalent rating under a
                    comparable rating system) as of its most recent
                    examination;
                      ``(C) the bank did not receive a `needs to improve'
                    or `substantial noncompliance' composite rating at its
                    most recent examination under the Community
                    Reinvestment Act of 1977; and
                      ``(D) the Comptroller of the Currency is otherwise
                    authorized to grant approval under this section to such
                    bank to establish and operate, or to retain and
                    operate, a branch or seasonal agency at the proposed
                    location.
              ``(3) Certain branches deemed to have approved
            applications.--A branch or seasonal agency established by a
            national bank under paragraph (2) shall be deemed to have been
            established and operated pursuant to an application approved
            under this section.''.
      (b) State Member Bank Branch Applications.--The third undesignated
    paragraph of section 9 of the Federal Reserve Act (12 U.S.C. 321) is
    amended by adding at the end the following: ``Notwithstanding the
    preceding 2 sentences, the approval of the Board shall not be required
    for a State member bank to establish and operate a branch or seasonal
    agency if--
                      ``(A) the State member bank is well-capitalized (as
                    defined in section 38 of the Federal Deposit Insurance
                    Act and regulations prescribed by the Board under such
                    section);
                      ``(B) the State member bank received a composite
                    CAMEL rating of `1' or `2' under the Uniform Financial
                    Institutions Rating System (or an equivalent rating
                    under a comparable rating system);
                      ``(C) the State member bank did not receive a `needs
                    to improve' or `substantial noncompliance' composite
                    rating at its most recent examination under the
                    Community Reinvestment Act of 1977; and
                      ``(D) the Board is otherwise authorized to grant
                    approval under this section to such State member bank
                    to establish and operate a branch or seasonal agency at
                    the proposed location.
    A branch or seasonal agency established by a State member bank under
    the previous sentence shall be deemed to have been established and
    operated pursuant to an application approved under this section.''.
      (c) State Nonmember Bank Branch Applications.--Section 18(d) of the
    Federal Deposit Insurance Act (12 U.S.C. 1828(d)) is amended by adding
    at the end the following new paragraphs:
              ``(5) Application exemption for certain banks.--
            Notwithstanding paragraph (1), the consent of the Corporation
            shall not be required for a State nonmember insured bank to
            establish and operate any domestic branch if--
                      ``(A) the bank is well-capitalized (as defined in
                    section 38 and regulations prescribed by the
                    Corporation under such section);
                      ``(B) the bank received a composite CAMEL rating of
                    `1' or `2' under the Uniform Financial Institutions
                    Rating System (or an equivalent rating under a
                    comparable rating system) as of its most recent
                    examination;
                      ``(C) the bank did not receive a `needs to improve'
                    or `substantial noncompliance' composite rating as
                    result of the bank's most recent examination under the
                    Community Reinvestment Act of 1977; and
                      ``(D) the Corporation is otherwise authorized to give
                    consent under this section to such bank to establish
                    and operate a domestic branch at the proposed location.
              ``(6) Approval granted.--A branch established by a State
            member bank under paragraph (5) shall be deemed to have been
            established and operated pursuant to an application approved
            under this section.''.

    SEC. 208. ELIMINATE BRANCH APPLICATIONS AND REQUIREMENTS FOR ATMs AND
                        SIMILAR FACILITIES.

      (a) Definition of Branch Under National Bank Act.--Section 5155(j) of
    the Revised Statutes (12 U.S.C. 36(j)) is amended--
              (1) by striking ``(j) The term'' and inserting ``(j)
            Branch.--
              ``(1) In general.--The term''; and
              (2) by adding at the end the following new paragraph:
              ``(2) Certain proprietary atms and remote servicing units.--
            The term `branch' does not include any automated teller machine
            or remote service unit which is owned and operated by a
            depository institution--
                      ``(A) primarily for the benefit of the institution
                    and the affiliates of the institution; and
                      ``(B) which could operate a branch at the location of
                    such machine or unit.''.
      (b) Definition of Branch Under Federal Deposit Insurance Act.--
    Section 3(o) of the Federal Deposit Insurance Act (12 U.S.C. 1813(o))
    is amended--
              (1) by striking ``(o) The term'' and inserting ``(o)
            Definitions Relating to Branches.--
              ``(1) Domestic branch.--
                      ``(A) In general.--The term''; and
              (2) by striking ``lent; and the term'' and inserting ``lent.
                      ``(B) Certain proprietary atms and remote servicing
                    units.--The term `domestic branch' does not include any
                    automated teller machine or remote service unit which
                    is owned and operated by a depository institution--
                              ``(i) primarily for the benefit of the
                            institution and the affiliates of the
                            institution; and
                              ``(ii) which could operate a branch at the
                            location of such machine or unit.
              ``(2) Foreign branch.--The term''.

    SEC. 209. ELIMINATE REQUIREMENT FOR APPROVAL OF INVESTMENTS IN BANK
                        PREMISES FOR WELL CAPITALIZED AND WELL MANAGED
                        BANKS.

      Section 24A of the Federal Reserve Act (12 U.S.C. 371d) is amended by
    inserting before the period in that section the following: ``or, in the
    case of a bank which received a composite CAMEL rating of `1' or `2'
    under the Uniform Financial Institutions Rating System (or an
    equivalent rating under a comparable rating system) as of its most
    recent examination and, both before and immediately following the
    investment or loan, is well capitalized (as defined under section 38 of
    the Federal Deposit Insurance Act), the amount which is equal to 150
    percent of the capital stock and surplus of such bank''.

    SEC. 210. ELIMINATE UNNECESSARY FILING FOR OFFICER AND DIRECTOR
                        APPOINTMENTS.
      Section 32(d) of the Federal Deposit Insurance Act (12 U.S.C.
    1831i(d)) is amended to read as follows:
      ``(d) Additional Information.--
              ``(1) In general.--Any notice submitted to an appropriate
            Federal banking agency with respect to an individual by any
            insured depository institution or depository institution
            holding company pursuant to subsection (a) shall include--
                      ``(A) the information described in section 7(j)(6)(A)
                    about the individual; and
                      ``(B) such other information as the agency may
                    prescribe by regulation.
              ``(2) Waiver.--An appropriate Federal banking agency may
            waive the requirement of this section by regulation or on a
            case-by-case basis consistent with safety and soundness.''.

    SEC. 211. STREAMLINING PROCESS FOR DETERMINING NEW NONBANKING
                        ACTIVITIES.
      Section 4(c)(8) of the Bank Holding Company Act of 1956 (12 U.S.C.
    1843(c)(8)) is amended--
              (1) by striking ``and opportunity for hearing''; and
              (2) by striking ``approval by the Board prior to January 1,
            1971.'' and inserting the following: ``approval by the Board
            prior to January 1, 1971, except that, after March 30, 1997, it
            shall be closely related to banking or managing or controlling
            banks and a proper incident thereto to provide insurance as a
            principal, agent, or broker in any State, in full compliance
            with the laws and regulations of such State that apply
            uniformly to each type of insurance license or authorization in
            that State, including laws that restrict a bank in that State
            from having an affiliate, agent, or employee in that State
            licensed to provide insurance as principal, agent, or broker.
            The Board shall prescribe regulations concerning insurance
            affiliations that provide equivalent treatment for all stock
            and mutual fund insurance companies that control or are
            affiliated with a bank, and fully accommodate and are
            consistent with State law.''.

    SEC. 212. DISPOSITION OF FORECLOSED ASSETS.

      Section 4(c)(2) of the Bank Holding Company Act of 1956 (12 U.S.C.
    1843(c)(2)) is amended--
              (1) by striking ``for not more than one year at a time''; and
              (2) by striking ``but no such extensions shall extend beyond
            a date five years'' and inserting ``and, in the case of a bank
            holding company which has not disposed of such shares within 5
            years of the date such shares were acquired, the Board may,
            upon the application of such company, grant additional
            exemptions if, in the Board's judgment, such extension would
            not be detrimental to the public interest and either the bank
            holding company has made a good faith attempt to dispose of
            such shares during such 5-year period or the disposal of such
            shares during such 5-year period would have been detrimental to
            the company, but the aggregate duration of such extensions
            shall not extend 10 years''.
    SEC. 213. INCREASE IN CERTAIN CREDIT UNION LOAN CEILINGS.

      Section 107(5)(A) of the Federal Credit Union Act (12 U.S.C.
    1757(5)(A)) is amended--
              (1) in clause (iv), by striking ``$10,000'' and inserting
            ``$50,000''; and
              (2) in clause (v), by striking ``$10,000'' and inserting
            ``$50,000''.

       Subtitle B--Streamlining of Government Regulations; Miscellaneous
                                   Provisions

    SEC. 221. ELIMINATE THE PER-BRANCH CAPITAL REQUIREMENT FOR NATIONAL
                        BANKS AND STATE MEMBER BANKS.

      Section 5155 of the Revised Statutes (12 U.S.C. 36) is amended--
              (1) by striking subsection (h); and
              (2) by redesignating subsections (i) (as amended by section
            207(a) of this Act), (j) (as amended by section 208(a) of this
            Act), (k), and (l) as subsections (h), (i), (j), and (k),
            respectively.

    SEC. 222. BRANCH CLOSURES.

      (a) In General.--Section 42 of the Federal Deposit Insurance Act (12
    U.S.C. 1831r-1) is amended by adding at the end the following new
    subsection:
      ``(e) Scope of Application.--
              ``(1) In general.--This section shall not apply with respect
            to--
                      ``(A) an automated teller machine;
                      ``(B) a branch which--
                              ``(i) has been acquired through merger,
                            consolidation, purchase, assumption, or other
                            method; and
                              ``(ii) is located--
                                      ``(I) within 2.5 miles of another
                                    branch of the acquiring institution; or
                                      ``(II) within a neighborhood
                                    currently being served by another
                                    branch of the acquiring institution,
                    if such other branch of the acquiring institution is
                    expected to continue to provide banking services to
                    substantially all of the customers currently served by
                    the branch acquired;
                      ``(C) a branch which is closing and reopening at a
                    location which is--
                              ``(i) within 2.5 miles of the location of the
                            branch being closed; or
                              ``(ii) within the same neighborhood as the
                            branch being closed,
                    if the branch at the new location is expected to
                    continue to provide banking services to substantially
                    all of the customers served by the branch at the former
                    location;
                      ``(D) a branch that is closed in connection with--
                              ``(i) an emergency acquisition under--
                                      ``(I) section 11(n); or
                                      ``(II) subsections (f) or (k) of
                                    section 13; or
                              ``(ii) any assistance provided by the
                            Corporation under section 13(c); and
                      ``(E) any other branch closure whose exemption from
                    the notice requirements of this section would not
                    produce a result inconsistent with the purposes of this
                    section.
              ``(2) Regulations.--The appropriate Federal banking agency
            shall, by regulation, determine the circumstances under which
            any exemption under paragraph(1)(E) may be granted.''.
      (b) Effective Date.--The amendment made by subsection (a) shall apply
    as if such amendment had been included in section 42 of the Federal
    Deposit Insurance Act as of the date of the enactment of the Federal
    Deposit Insurance Corporation Improvement Act of 1991.

    SEC. 223. AMENDMENTS TO THE DEPOSITORY INSTITUTIONS MANAGEMENT
                        INTERLOCKS ACT.

      (a) Dual Service in Same Area, Town, or Village.--Section 203 of the
    Depository Institution Management Interlocks Act (12 U.S.C. 3202) is
    amended--
              (1) by inserting ``(a) Prohibitions.--'' before ``A
            management official''; and
              (2) by adding after subsection (a) the following new
            subsection:
      ``(b) Small Market Share Exemption.--
              ``(1) In general.--This section shall not be construed as
            prohibiting a management official of a depository institution
            or depository holding company from serving as a management
            official of another depository institution or depository
            holding company not affiliated with such institution or holding
            company if the depository institutions or depository holding
            companies with which the management official serves hold,
            together with all the affiliates of such institutions or
            holding companies, in the aggregate no more that 20 percent of
            the deposits in each relevant geographic banking market where
            offices of the depository institutions or depository holding
            companies or their affiliates are located.
              ``(2) Relevant geographic banking market defined.--For
            purposes of paragraph (1), the term `relevant geographic
            banking market' means--
                      ``(A) the area defined by the boundaries identified
                    by the Board of Governors of the Federal Reserve
                    System;
                      ``(B) if the Board has not defined such boundaries,
                    the area defined by the boundaries of the Ranally
                    Metropolitan Area in which the office of the depository
                    institution or the depository institution holding
                    company is located; and
                      ``(C) if the office of such institution or company is
                    not located within a Ranally Metropolitan Area, the
                    area defined by the county (or an equivalent area of
                    general local government) in which such office is
                    located.''.
      (b) Dual Service Among Larger Organizations.--Section 204 of the
    Depository Institution Management Interlocks Act (12 U.S.C. 3203) is
    amended to read as follows:

    ``SEC. 204. DUAL SERVICE AMONG LARGER ORGANIZATIONS.

      ``(a) In General.--If a depository institution, depository
    institution holding company, or depository institution affiliate of any
    such institution or company has total assets exceeding $2,500,000,000,
    a management official of such institution, company, or affiliate may
    not serve as a management official of any other depository institution,
    depository institution holding company, or depository institution
    affiliate of any such institution or company which--
              ``(1) is not an affiliate of the institution, company, or
            affiliate of which such person is a management official; and
              ``(2) has total assets exceeding $1,500,000,000.
      ``(b) CPI Adjustments.--The dollar amounts in this section shall be
    adjusted annually after December 31, 1994, by the annual percentage
    increase in the Consumer Price Index for Urban Wage Earners and
    Clerical Workers published by the Bureau of Labor Statistics.''.
      (c) Extension of Grandfather Exemption.--Section 206 of the
    Depository Institution Management Interlocks Act (12 U.S.C. 3205) is
    amended--
              (1) in subsection (a), by striking ``for a period of, subject
            to the requirements of subsection (c), 20 years after the date
            of enactment of this title'';
              (2) in subsection (b), by striking the 2d sentence; and
              (3) by striking subsection (c).
      (d) Rules or Regulations.--Section 209 of the Depository Institution
    Management Interlocks Act (12 U.S.C. 3207) is amended--
              (1) by striking ``(a) In General.--Rules'' and inserting
            ``Rules'';
              (2) by inserting ``, including rules or regulations which
            permit service by a management official which would otherwise
            be prohibited by section 203 or section 204,'' after ``title'';
            and
              (3) by striking subsections (b) and (c).
    SEC. 224. ACCELERATION OF REPAYMENT TO TREASURY.
      The Appraisal Subcommittee of the Financial Institutions Examination
    Council shall repay to the Secretary of the Treasury the funds
    specified in section 1108 of Financial Institutions Reform, Recovery,
    and Enforcement Act of 1989 by not later than September 30, 1998, and
    the Secretary shall deposit such funds in the general fund of the
    Treasury.

    SEC. 225. ELIMINATE UNNECESSARY AND DUPLICATIVE RECORDKEEPING AND
                        REPORTING REQUIREMENTS RELATING TO LOANS TO
                        EXECUTIVE OFFICERS AND PERMIT PARTICIPATION IN
                        EMPLOYEE BENEFIT PLANS.

      (a) Amendments to Section 22(h) of the Federal Reserve Act.--
              (1) Employee benefit plans.--Section 22(h)(2) of the Federal
            Reserve Act (12 U.S.C. 375b(2)) is amended--
                      (A) by redesignating subparagraphs (A), (B), and (C)
                    as clauses (i), (ii), and (iii), respectively, and
                    moving the left margins of such clauses 2 ems to the
                    right;
                      (B) by striking ``(2) Preferential terms
                    prohibited.--A member bank'' and inserting ``(2)
                    Preferential terms prohibited.--
                      ``(A) In general.--A member bank''; and
                      (C) by adding at the end the following new
                    subparagraph:
                      ``(B) Exception.--No provision of this paragraph
                    shall be construed as prohibiting extensions of credit
                    that constitute a benefit or compensation program that
                    is widely available to and used by employees of the
                    member bank, including employees who are not executive
                    officers of the bank.''.
              (2) Exception for extensions of credit to executive officers
            and directors of nonbank affiliates.--Section 22(h)(8)(B) of
            the Federal Reserve Act (12 U.S.C. 375b(8)(B)) is amended to
            read as follows:
                      ``(B) Exception.--The Board may, by regulation, make
                    exceptions to subparagraph (A) for an executive officer
                    or director of a subsidiary of a company that controls
                    the member bank if--
                              ``(i) the executive officer or director does
                            not have authority to participate, and does not
                            participate, in major policymaking functions of
                            the member bank; and
                              ``(ii) the assets of such subsidiary do not
                            exceed 10 percent of the consolidated assets of
                            a company that controls the member bank and
                            such subsidiary (and is not controlled by any
                            other company).''.
              (3) Recordkeeping requirements.--Section 22(h)(10) of the
            Federal Reserve Act (12 U.S.C. 375b(10)) is amended by adding
            at the end the following: ``The Board shall specify by
            regulation the recordkeeping required of member banks to ensure
            compliance with this section.''.
      (b) Reporting Requirements.--
              (1) Unnecessary reports.--Section 22(g) of the Federal
            Reserve Act (12 U.S.C. 375a) is amended--
                      (A) by striking paragraphs (6) and (9); and
                      (B) by redesignating paragraphs (7), (8), and (10) as
                    paragraphs (8), (9), and (10), respectively.
              (2) Unnecessary reports.--Section 7 of the Federal Deposit
            Insurance Act (12 U.S.C. 1817) is amended by striking
            subsection (k).
              (3) Unnecessary reports regarding loans from correspondent
            banks.--Section 106(b)(2) of the Bank Holding Company Act
            Amendments of 1970 (12 U.S.C. 1972(2)) is amended--
                      (A) by striking subparagraph (G); and
                      (B) by redesignating subparagraphs (H) and (I) as
                    subparagraphs (G) and (H), respectively.
      (c) Amendments Relating to Loans to Executive Officers.--Section
    22(g) of the Federal Reserve Act (12 U.S.C. 375a) (as amended by
    subsection (a) of this section) is amended--
              (1) in paragraph (1)(D), by striking ``of any one of the
            three categories respectively referred to in paragraphs (2),
            (3), and (4)'' and inserting ``of any category referred to in
            paragraph (2), (3), (4), (5), or (6)'';
              (2) by redesignating paragraphs (4) and (5) as paragraphs (6)
            and (7), respectively;
              (3) by inserting after paragraph (3) the following new
            paragraph:
              ``(4) Home equity lines of credit.--A member bank may make a
            revolving open-end extension of credit to any executive officer
            of the bank if the credit--
                      ``(A) does not exceed $100,000; and
                      ``(B) is secured by a dwelling that is owned by such
                    officer and used by the officer as a residence.
              ``(5) Loans secured by marketable assets.--A member bank may
            extend credit to any executive officer of the bank if the
            credit is secured by readily marketable assets of a value not
            exceeding such amount as the Board may establish by
            regulation.''; and
              (4) in paragraph (7) (as so redesignated by paragraph (2) of
            this subsection) by striking ``(4)'' each place such term
            appears and inserting ``(6)''.

    SEC. 226. EXPANDED REGULATORY DISCRETION FOR SMALL BANK EXAMINATIONS.

      (a) Small Bank Size Discretion.--Section 10(d) of the Federal Deposit
    Insurance Act (12 U.S.C. 1820(d)) is amended--
              (1) by redesignating paragraph (9) as paragraph (10);
              (2) by redesignating the 2d of the 2 paragraphs designated as
            paragraph (8) as paragraph (9); and
              (3) in paragraph (9) (as so redesignated), by striking
            ``$175,000,000'' and inserting ``$250,000,000''.
      (b) Inflation Adjustment.--Section 10(d) of the Federal Deposit
    Insurance Act (12 U.S.C. 1820(d)) is amended by inserting after
    paragraph (10) (as so redesignated in subsection (a)(1) of this
    section) the following new paragraph:
              ``(11) Annual cpi adjustment.--The dollar amount in this
            section shall be adjusted annually after December 31, 1994, by
            the annual percentage increase in the Consumer Price Index for
            Urban Wage Earners and Clerical Workers published by the Bureau
            of Labor Statistics.''.
      (c) Coordinated Federal and State Examinations.--The Federal banking
    agencies (as defined in section 3 of the Federal Deposit Insurance Act)
    shall submit semiannual reports to the Congress on the progress made by
    such agencies in implementing the requirements of section 10(d)(6) of
    the Federal Deposit Insurance Act until such agencies submit a final
    report that--
              (1) the examination system provided for in such section is in
            place; and
              (2) such system provides for full coordination of
            examinations of State depository institutions with State bank
            supervisors.

    SEC. 227. COST REIMBURSEMENT.

      Section 1115 of the Right to Financial Privacy Act (12 U.S.C. 3415)
    is amended by inserting ``(including corporate customers)'' after
    ``pertaining to a customer''.

    SEC. 228. IDENTIFICATION OF FOREIGN NONBANK FINANCIAL INSTITUTION
                        CUSTOMERS.

      (a) In General.--Section 5327(a)(1) of title 31, United States Code,
    is amended to read as follows:
              ``(1) is a financial institution (other than a foreign bank
            (as defined in section 101(b) of the International Banking Act
            of 1978)) which is a foreign person; and''.
      (b) Technical and Conforming Amendment.--The heading for section 5327
    of title 31, United States Code, is amended by inserting ``foreign
    nonbank'' after ``of''.
      (c) Clerical Amendment.--The table of sections for chapter 53 of
    title 31, United States Code, is amended by striking the item relating
    to section 5327 and inserting the following new item:

    ``5327. Identification of foreign nonbank financial institutions.''.
    SEC. 229. PAPERWORK REDUCTION REVIEW.

      Not later than 180 days after the date of enactment of this Act, each
    appropriate Federal banking agency and the National Credit Union
    Administration, in consultation with insured depository institutions,
    insured credit unions, and other interested parties, shall--
              (1) review the extent to which current regulations require
            insured depository institutions and insured credit unions to
            produce unnecessary internal written policies; and
              (2) eliminate such requirements, where appropriate.
    For purposes of this section, the terms ``insured depository
    institution'' and ``appropriate Federal banking agency'' have the same
    meanings as in section 3 of the Federal Deposit Insurance Act and the
    term ``insured credit union'' has the same meaning as in section 101(7)
    of the Federal Credit Union Act.

    SEC. 230. DAILY CONFIRMATIONS FOR HOLD-IN-CUSTODY REPURCHASE
                        TRANSACTIONS.

      Before the end of the 1-year period beginning on the date of the
    enactment of this Act, the Secretary of the Treasury shall revise the
    regulation under section 15C of the Securities Exchange Act of 1934
    relating to the obligations of financial institutions and of brokers
    and dealer registered under such Act holding custody of securities
    subject to a repurchase agreement to confirm, daily and in writing, the
    securities that are subject to such repurchase agreement. Such revision
    shall permit the counterparty to such agreement to waive in writing the
    right to obtain such daily written confirmation if the counterparty has
    received a clear and conspicuous disclosure before entering into any
    side agreement, in a form prescribed by the Secretary, that adequately
    informs the counterparty of the benefits of receiving such daily
    written confirmations.
    SEC. 231. REQUIRED REGULATORY REVIEW OF REGULATIONS.

      (a) In General.--Not less frequently than once every 10 years, the
    Financial Institutions Examination Council (hereafter in this section
    referred to as the ``Council'') and each appropriate Federal banking
    agency (as defined in section 3(q) of the Federal Deposit Insurance
    Act) represented on the Council shall conduct a review of all
    regulations prescribed by the Council or by any such agency,
    respectively, in order to identify outdated or otherwise unnecessary
    regulatory requirements imposed upon insured depository institutions.
      (b) Process.--In conducting the review under subsection (a), the
    Council or the appropriate Federal banking agency shall--
              (1) categorize the regulations by type (such as consumer
            regulations, safety and soundness regulations, or such other
            designations as determined by the Council); and
              (2) at regular intervals, provide notice and solicit public
            comment on a particular category or categories of regulations,
            requesting commentators to identify areas of the regulations
            that are outdated, unnecessary, or unduly burdensome.
      (c) Complete Review.--The Council or the appropriate Federal banking
    agency shall ensure that the notice and comment period described in
    subsection (b)(2) is conducted with respect to all regulations
    described in subsection (a) not less frequently than once every 10
    years.
      (d) Regulatory Response.--The Council or the appropriate Federal
    banking agency shall--
              (1) publish in the Federal Register a summary of the comments
            received under this section, identifying significant issues
            raised and providing comment on such issues; and
              (2) eliminate unnecessary regulations to the extent that such
            action is appropriate.
      (e) Report to Congress.--Not later than 30 days after carrying out
    subsection (d)(1), the Council shall provide to the Congress a report,
    which shall include--
              (1) a summary of any significant issues raised by public
            comments received by the Council and the appropriate Federal
            banking agencies under this section and the relative merits of
            such issues; and
              (2) an analysis of whether the appropriate Federal banking
            agency involved is able to address the regulatory burdens
            associated with such issues by regulation, or whether such
            burdens must be addressed by legislative action.

    SEC. 232. COUNTRY RISK REQUIREMENTS.

      Subsections (a)(1) and (b) of section 905 of the International
    Lending Supervision Act of 1983 (12 U.S.C. 3904) are amended by
    striking ``shall'' and inserting ``may''.

    SEC. 233. AUDIT COSTS.

      (a) In General.--
              (1) Auditor attestations.--Section 36 of the Federal Deposit
            Insurance At (12 U.S.C. 1831m) is amended--
                      (A) in subsection (a)(2)(A)(ii), by striking
                    ``subsections (c) and (d)'' and inserting ``subsection
                    (c)'';
                      (B) by striking subsections (c) and (e); and
                      (C) by redesignating subsections (d), (f), (g), (h),
                    (i), and (j) as subsections (c), (d), (e), (f), (g),
                    and (h), respectively.
              (2) Public availability.--Section 36(a)(3) of the Federal
            Deposit Insurance Act (12 U.S.C. 1831m(a)(3)) is amended by
            inserting at the end the following new sentence:
            ``Notwithstanding the preceding sentence, the Corporation and
            the appropriate Federal banking agencies may designate certain
            information as privileged and confidential and not available to
            the public.''.
      (b) Exemption for Well-Capitalized and Well-Managed Insured
    Depository Institutions.--Section 36 of the Federal Deposit Insurance
    Act (12 U.S.C. 1831m) (as amended by subsection (a) of this section) is
    amended by adding at the end the following new subsection:
      ``(i) Exemption for Well-Capitalized and Well-Managed Insured
    Depository Institutions.--No provision of this section other than
    subsection (c) shall apply with respect to any insured depository
    institution which is well-capitalized and well-managed.''.
      (c) Technical and Conforming Amendments.--
              (1) Paragraph (1)(B) of section 36(e) of the Federal Deposit
            Insurance Act (as so redesignated by subsection (a)(1)(C) of
            this section) is amended by striking ``(b)(2), (c), and (d)''
            and inserting ``(b)(2) and (c)''.
              (2) Paragraph (1) of section 36(g) of the Federal Deposit
            Insurance Act (as so redesignated by subsection (a)(1)(C) of
            this section) is amended by striking ``(d)'' and inserting
            ``(c)''.

    SEC. 234. STANDARDS FOR DIRECTOR AND OFFICER LIABILITY.

      Section 3(u) of the Federal Deposit Insurance Act (12 U.S.C. 1813(u))
    is amended--
              (1) in paragraph (1), by inserting ``(other than an outside
            director)'' after ``director'';
              (2) in paragraph (3), by inserting ``(other than an outside
            director)'' after ``any other person''; and
              (3) in paragraph (4), by inserting ``or outside director''
            after ``or accountant)''.
    SEC. 235. FOREIGN BANK APPLICATIONS.

      (a) Provisions Relating to Establishment of Bank Offices.--Section
    7(d) of the International Banking Act of 1978 (12 U.S.C. 3105(d)) is
    amended--
              (1) in paragraph (2), by striking ``The'' and inserting
            ``Except as provided in paragraph (6), the'';
              (2) in paragraph (5), by striking ``Consistent with the
            standards for approval in paragraph (2), the'' and inserting
            ``The''; and
              (3) by adding at the end the following new paragraphs:
              ``(6) Exception.--
                      ``(A) In general.--If the Board is unable to find
                    under paragraph (2) that a foreign bank is subject to
                    comprehensive supervision or regulation on a
                    consolidated basis by the appropriate authorities in
                    its home country, the Board may nevertheless approve an
                    application under paragraph (1) by such foreign bank
                    if--
                              ``(i) the appropriate authorities in the home
                            country of such foreign bank are working to
                            establish arrangements for the consolidated
                            supervision of such bank; and
                              ``(ii) all other factors are consistent with
                            approval.
                      ``(B) Additional conditions.--The Board, after
                    requesting and considering the views of the appropriate
                    State bank supervisor or the Comptroller of the
                    Currency, as the case may be, may impose such
                    conditions or restrictions relating to activities or
                    business operations of the proposed branch, agency, or
                    commercial lending company subsidiary, including
                    restrictions on sources of funding, as are considered
                    appropriate in the public interest.
                      ``(C) Modification of conditions.--Any condition or
                    restriction imposed by the Board under this subsection
                    in connection with the approval of an application may
                    be varied or withdrawn where such modification is
                    consistent with the public interest.
              ``(7) Time period for board action.--
                      ``(A) Final action.--The Board shall take final
                    action on any application under paragraph (1) within
                    180 days of receipt of the application, except that the
                    Board may extend for an additional 180 days the period
                    within which to take final action on such application,
                    after providing notice of, and the reasons for, the
                    extension to the applicant foreign bank and any
                    appropriate State bank supervisor or the Comptroller of
                    the Currency, as the case may be.
                      ``(B) Failure to submit information.--The Board may
                    deny any application if it has not received information
                    requested from the applicant foreign bank or
                    appropriate authorities in the home country in
                    sufficient time to permit the Board to evaluate such
                    information adequately within the time periods for
                    final action set forth in subparagraph (A).
                      ``(C) Waiver.--A foreign bank may waive the
                    applicability of subparagraph (A) with respect to any
                    such application.''.
      (b) Provision Relating To Termination of Bank Offices.--Section
    7(e)(1)(A) of the International Banking Act of 1978 (12 U.S.C.
    3105(e)(1)(A)) is amended--
              (1) by striking ``(A)'' and inserting ``(A)(i)'';
              (2) by striking ``; or'' and inserting ``; and''; and
              (3) by inserting at the end the following new clause:
                      ``(ii) the appropriate authorities in the home
                    country are not making progress in establishing
                    arrangements for the comprehensive supervision or
                    regulation of such foreign bank on a consolidated
                    basis; or''.
      (c) Uniform Terminations of Foreign Bank Offices, Agencies, Branches,
    and Subsidiaries by the Federal Reserve System.--
              (1) In general.--Section 7(e)(1) of the International Banking
            Act of 1978 (12 U.S.C. 3105(e)(1)) is amended--
                      (A) by inserting ``or the Comptroller of the
                    Currency'' after ``State bank supervisor'';
                      (B) by inserting ``or a Federal branch or agency''
                    after ``commercial lending company subsidiary'' the 1st
                    place such term appears; and
                      (C) in the last sentence, by inserting ``or a Federal
                    branch or agency'' after ``commercial lending company
                    subsidiary''.
              (2) Technical and conforming amendment.--Section 7(e) of the
            International Banking Act of 1978 (12 U.S.C. 3105(e)) is
            amended--
                      (A) by striking paragraph (5); and
                      (B) by redesignating paragraphs (6) and (7) as
                    paragraphs (5) and (6), respectively.

    SEC. 236. DUPLICATE EXAMINATION OF FOREIGN BANKS.

      Section 7(c)(1) of the International Banking Act of 1978 (12 U.S.C.
    3105(c)(1)) is amended--
              (1) by adding after clause (ii) of subparagraph (B) the
            following new clause:
                              ``(iii) Avoidance of duplication.--In
                            exercising its authority under this paragraph,
                            the Board shall take all reasonable measures to
                            reduce burden and avoid unnecessary duplication
                            of examinations.'';
              (2) by striking subparagraph (C) and inserting the following:
                      ``(C) On-site examination.--Each Federal branch or
                    agency, and each State branch or agency, of a foreign
                    bank shall be subject to on-site examination by a
                    Federal banking agency or State bank supervisor as
                    frequently as would a national bank or State bank,
                    respectively, by its appropriate Federal banking
                    agency.''; and
              (3) by amending subparagraph (D) to read as follows:
                      ``(D) Cost of examinations.--The cost of any
                    examination undertaken pursuant to subparagraph (A)
                    shall be assessed against and collected from the
                    foreign bank or the foreign company that controls the
                    foreign bank, as the case may be, but only to the same
                    extent that fees are collected by the Board for
                    examination of any State member insured bank.''.

    SEC. 237. SECOND MORTGAGES.

      (a) In General.--Section 103(aa)(1) of the Truth in Lending Act (15
    U.S.C. 1602(aa)(1)) is amended--
              (1) by inserting ``a subordinate mortgage on'' after
            ``secured by''; and
              (2) by striking ``a residential mortgage transaction''.
      (b) Effect on Pending Cases.--Any administrative enforcement
    proceeding or other action which--
              (1) is pending on the date of the enactment of this Act; and
              (2) is based on regulations in effect as of such date under
            the Truth in Lending Act with respect to high-cost residential
            mortgage transactions which are not subordinate mortgages,
    shall be dismissed as of such date.
    SEC. 238. STREAMLINING FDIC APPROVAL OF NEW STATE BANK POWERS.

      (a) In General.--Section 24(a) of the Federal Deposit Insurance Act
    (12 U.S.C. 1831a(a)) is amended to read as follows:
      ``(a) Activities Generally.--
              ``(1) In general.--An insured State bank may not engage as
            principal in any type of activity that is not permissible for a
            national bank unless--
                      ``(A) the bank has given the Corporation written
                    notice of the bank's intention to engage in such
                    activity at least 60 days before commencing to engage
                    in the activity and within such 60-day period (or
                    within the extended period provided under paragraph
                    (2)) the Corporation has not disapproved the activity;
                    and
                      ``(B) the State bank is, and continues to be, in
                    compliance with applicable capital standards prescribed
                    by the appropriate Federal banking agency.
              ``(2) Extension of period.--The Corporation may extend the
            60-day period referred to in paragraph (1) for issuing a notice
            of disapproval with respect to any activity for an additional
            30 days.
              ``(3) Contents of notice.--Any notice submitted by a State
            bank under paragraph (1)(A) shall contain such information as
            the Corporation may require.
              ``(4) Basis for disapproval.--The Corporation may disapprove
            an activity for a State bank under this subsection unless the
            Corporation determines that the activity would pose no
            significant risk to the appropriate insurance fund.''.
      (b) Subsidiaries of Insured State Banks.--Section 24(d)(1) of the
    Federal Deposit Insurance Act (12 U.S.C. 1831a(d)(1)) is amended to
    read as follows:
              ``(1) Activities generally.--
                      ``(A) In general.--A subsidiary of an insured State
                    bank may not engage as principal in any type of
                    activity that is not permissible for a subsidiary of a
                    national bank unless--
                              ``(i) the subsidiary has given the
                            Corporation written notice of the subsidiary's
                            intention to engage in such activity at least
                            60 days before commencing to engage in the
                            activity and within such 60-day period (or
                            within the extended period provided under
                            paragraph (2)) the Corporation has not
                            disapproved the activity; and
                              ``(ii) the bank is, and continues to be, in
                            compliance with applicable capital standards
                            prescribed by the appropriate Federal banking
                            agency.
                      ``(B) Extension of period.--The Corporation may
                    extend the 60-day period referred to in subparagraph
                    (A) for issuing a notice of disapproval with respect to
                    any activity for an additional 30 days.
                      ``(C) Contents of notice.--Any notice submitted by a
                    subsidiary of an insured State bank under subparagraph
                    (A)(i) shall contain such information as the
                    Corporation may require.
                      ``(D) Basis for disapproval.--The Corporation may
                    disapprove an activity for a subsidiary of an insured
                    State bank under this paragraph unless the Corporation
                    determines that the activity would pose no significant
                    risk to the appropriate insurance fund.''.
    SEC. 239. REPEAL OF CALL REPORT ATTESTATION REQUIREMENT.

      Section 5211(a) of the Revised Statutes (12 U.S.C. 161(a)) is amended
    by striking the 4th sentence.
    SEC. 240. AUTHORITY OF THE COMPTROLLER OF THE CURRENCY.

      (a) State Supervision.--Chapter 1 of Title LXII of the Revised
    Statutes of the United States (12 U.S.C. 21 et seq.) is amended--
              (1) by redesignating section 5136A as section 5136C; and
              (2) by inserting after section 5136 (12 U.S.C. 24) the
            following new section:

    ``SEC. 5136A. STATE SUPERVISION OF INSURANCE.

      ``(a) State Licensing of Insurance Activities.--
              ``(1) In general.--Subject to paragraph (2), no provision of
            section 5136, any other section of this title, or section 13 of
            the Federal Reserve Act may be construed as limiting or
            otherwise impairing the authority of any State to regulate--
                      ``(A) the extent to which, and the manner in which, a
                    national bank may engage within the State in insurance
                    activities pursuant to section 5136B of this chapter or
                    section 13 of the Federal Reserve Act;
                      ``(B) the manner in which a national bank may engage
                    within the State in insurance activities pursuant to
                    section 5136(b)(2)(B) of the Revised Statutes of the
                    United States; or
                      ``(C) the manner in which a national bank may engage
                    within the State in insurance activities pursuant to
                    section 5136(b)(2)(A) of the Revised Statutes of the
                    United States through, and limited to, consumer
                    disclosure requirements or licensing requirements,
                    procedures, and qualifications as described in
                    paragraph (2)(C).
              ``(2) Prohibition on state discrimination against national
            banks.--Notwithstanding paragraph (1)--
                      ``(A) Providing insurance as agent or broker.--No
                    State may impose any insurance regulatory requirement
                    relating to providing insurance as an agent or broker
                    that treats a national bank differently than all other
                    persons who are authorized to provide insurance as
                    agents or brokers in such State, unless there is a
                    legitimate and reasonable State regulatory purpose for
                    the requirement for which there is no less restrictive
                    alternative.
                      ``(B) Providing insurance as principal, agent, or
                    broker.--
                              ``(i) No State may impose on a national bank
                            any insurance regulatory requirement relating
                            to providing insurance as principal, agent, or
                            broker that treats the national bank more
                            restrictively than any other depository
                            institution (as defined in section 3(c)(1) of
                            the Federal Deposit Insurance Act, 12 U.S.C.
                            1813(c)(1)) operating in the State.
                              ``(ii) Nothing in this subparagraph shall
                            affect the validity of a State law that--
                                      ``(I) prevents a national bank from
                                    engaging in insurance activities within
                                    the State to as great an extent as a
                                    savings association (as defined in
                                    section 3(b)(1) of the Federal Deposit
                                    Insurance Act, 12 U.S.C. 1813(b)(1))
                                    may engage in such activities within
                                    the State; and
                                      ``(II) was in effect on June 1, 1995.
                      ``(C) Licensing qualifications and procedures.--No
                    State may discriminate against a national bank with
                    respect to the following requirements, procedures, and
                    qualifications as such requirements, procedures, and
                    qualifications relate to the authority of the national
                    bank to provide insurance in such State as an agent or
                    broker:
                              ``(i) License application and processing
                            procedures.
                              ``(ii) Character, experience, and educational
                            qualifications for licenses.
                              ``(iii) Testing and examination requirements
                            for licenses.
                              ``(iv) Fee requirements for licenses.
                              ``(v) Continuing education requirements.
                              ``(vi) Types of licenses required.
                              ``(vii) Standards and requirements for
                            renewal of licenses.
      ``(b) Authority of the Comptroller of the Currency.--A national bank
    may not provide insurance as a principal, agent, or broker except as
    specifically provided in this section, the paragraph designated as the
    `Seventh' of section 5136(a) of this chapter, section 5136(b) or 5136B
    of this chapter, or section 13 of the Federal Reserve Act.
      ``(c) Preservation of Federally Authorized Bank Activities in
    Permissive States.--No provision of this section may be construed as
    affecting the authority, pursuant to section 5136B of this chapter or
    section 13 of the Federal Reserve Act, of a national bank to act as
    insurance agent or broker consistent with State law.
      ``(d) Preservation of National Bank Authority Consistent With State
    Bank Authority.--Except as provided in subsection (a)(2)(B), no
    provision of this section or section 5136(b)(1) shall have the effect
    of enabling a State to deny a national bank authority that the bank
    otherwise possesses to provide a product in a State, including as
    agent, broker, or principal, where the bank is not providing the
    product in the State other than to an extent and in a manner that a
    State bank (as defined in section 3(a)(2) of the Federal Deposit
    Insurance Act, 12 U.S.C. 1813(a)(2)) is permitted by the law of the
    State to provide such product, except that nothing in this subsection
    shall be construed as granting any new authority to a national bank to
    provide any product because the law of the State has authorized State
    banks to provide such product.
      ``(e) Definitions.--For purposes of this section, sections 5136 and
    5136B, and section 13 of the Federal Reserve Act, the following
    definitions shall apply:
              ``(1) Insurance.--The term `insurance' means any product
            defined or regulated as insurance, consistent with the relevant
            State insurance law, by the insurance regulatory authority of
            the State in which such product is sold, solicited, or
            underwritten, including any annuity contract the income on
            which is tax deferred under section 72 of the Internal Revenue
            Code of 1986.
              ``(2) State.--The term `State' has the same meaning as in
            section 3(a)(3) of the Federal Deposit Insurance Act.
      ``(f) Grandfather Provision.--
              ``(1) In general.--Any national bank which, before January 1,
            1995, was providing insurance as agent or broker under section
            13 of the Federal Reserve Act may provide insurance as an agent
            or broker under such section, to no less extent and in a no
            more restrictive manner as such bank was providing insurance as
            agent or broker under such section on January 1, 1995,
            notwithstanding contrary State law, subject to final,
            controlling judgment in a pending action.
              ``(2) Termination.--This subsection shall cease to apply with
            respect to any national bank described in paragraph (1) if--
                      ``(A) the bank is subject to an acquisition, merger,
                    consolidation, or change in control, other than a
                    transaction to which section 18(c)(12) of the Federal
                    Deposit Insurance Act applies; or
                      ``(B) any bank holding company which directly or
                    indirectly controls such bank is subject to an
                    acquisition, merger, consolidation, or change in
                    control, other than a transaction in which the
                    beneficial ownership of such bank holding company or of
                    a bank holding company which controls such company does
                    not change as a result of the transaction.
      ``(g) Preservation of Banking Products.--Nothing in this section
    shall be construed as affecting the ability of a national bank, or a
    subsidiary of a national bank, to engage in any activity, including any
    activity authorized pursuant to the paragraph designated the
    ``Seventh'' of section 5136(a), that is part of, and not merely
    incidental to, the business of banking.''.
      (b) Interpretive Authority of the Comptroller of the Currency.--
    Section 5136 of the Revised Statutes of the United States (12 U.S.C.
    24) is amended--
              (1) by striking ``Upon duly making and filing articles of
            association'' and inserting ``(a) In General.--Upon duly making
            and filing articles of association''; and
              (2) by adding at the end the following new subsection:
      ``(b) Interpretive Authority of the Comptroller of the Currency.--
              ``(1) In general.--Subject to paragraph (2), it shall not be
            incidental to banking for a national bank to provide insurance
            as a principal, agent, or broker.
              ``(2) Scope of application.--Notwithstanding paragraph (1),
            it shall be incidental to banking for a national bank to engage
            in the following activities:
                      ``(A) Providing, as an agent or broker, any annuity
                    contract the income on which is tax deferred under
                    section 72 of the Internal Revenue Code of 1986.
                      ``(B) Providing, as a principal, agent, or broker,
                    any type of insurance, other than an annuity or title
                    insurance, which the Comptroller of the Currency
                    specifically determined, before May 1, 1995, to be
                    incidental to banking with respect to national
                    banks.''.
      (c) Technical and Conforming Amendments.--
              (1) The 11th undesignated paragraph of section 13 of the
            Federal Reserve Act (12 U.S.C. 92) is amended by inserting ``,
            and subject to section 5136A of the Revised Statutes of the
            United States,'' after ``the laws of the United States''.
              (2) The paragraph designated the ``Seventh'' of section 5136
            of the Revised Statutes of the United States (12 U.S.C. 24) is
            amended by striking ``subject to law,'' and inserting ``subject
            to subsection (b), section 5136A, and any other provision of
            law,''.
              (3) Section 1306 of title 18, United States Code, is amended
            by striking ``5136A'' and inserting ``5136C''.
      (d) Clerical Amendment.--The table of sections for chapter 1 of title
    LXII of the Revised Statutes of the United States is amended--
              (1) by redesignating the item relating to section 5136A as
            section 5136C; and
              (2) by inserting after the item relating to section 5136 the
            following new item:

    ``5136A. State supervision of insurance.''.

      (e) Preservation of Bank Holding Company Insurance Authority.--No
    provision of this section, and no amendment made by this section to any
    other provision of law, may be construed as affecting the authority of
    a bank holding company to engage in insurance agency activity pursuant
    to section 4(c) of the Bank Holding Company Act of 1956 (12 U.S.C.
    1843(c)).
    SEC. 241. NATIONAL BANK COMMUNITY DEVELOPMENT INSURANCE ACTIVITIES.

      (a) In General.--Chapter 1 of Title LXII of the Revised Statutes of
    the United States (12 U.S.C. 21 et seq.) is amended by inserting after
    section 5136A (as added by section 240(a) of this Act) the following
    new section:

    ``SEC. 5136B. INSURANCE SALES IN EMPOWERMENT ZONES.

      ``(a) Authority To Sell Insurance as Agent From Empowerment Zones.--
    The Comptroller of the Currency may approve an application by a
    national bank maintaining a main office or full-service branch in an
    empowerment zone to act as an agent or broker from such office or
    branch for any fire, life, or other insurance company authorized to do
    business in the State in which the customer is located if--
              ``(1) the bank provides sufficient evidence that the
            availability of competitively priced insurance in the
            empowerment zone is inadequate; and
              ``(2) the insurance is sold only in the empowerment zone.
      ``(b) Application of State Law.--State laws which regulate conducting
    the business of insurance shall apply to national banks and their
    employees that sell insurance as agent or broker under this section to
    the same extent as such laws apply to other entities and persons not
    affiliated with depository institutions except--
              ``(1) in any case in which the Comptroller of the Currency
            determines, after notice to and comment by the appropriate
            State insurance officials, that the application of a State law
            would have an unreasonably discriminatory effect upon the sale
            of insurance by national banks or their employees in comparison
            with the effect the application of the State law would have
            with respect to sale of insurance by other entities; or
              ``(2) when State law by its own terms does not apply to
            national banks or employees of such banks.
      ``(c) Authority of Comptroller of the Currency.--
              ``(1) In general.-- The Comptroller of the Currency may
            prescribe regulations governing sales of insurance by national
            banks pursuant to this section.
              ``(2) Enforcement of state law.--The provisions of any State
            law to which a national bank is subject under this section
            shall be enforced with respect to such bank by the Comptroller
            of the Currency.
      ``(d) Definitions.--
              ``(1) Empowerment zone.--The term `empowerment zone' means an
            area that meets the standards for designation as an empowerment
            zone or enterprise community under section 1392 of the Internal
            Revenue Code of 1986 or an Indian reservation.
              ``(2) Full-service branch.--The term `full-service branch'
            means a staffed facility which has been approved as a branch
            and offers loan and deposit services.
              ``(3) Indian reservation.--The term `Indian reservation' has
            the meaning given such term by section 168(j)(6) of the
            Internal Revenue Code of 1986.''.
      (b) Clerical Amendment.--The table of sections for chapter 1 of title
    LXII of the Revised Statutes of the United States is amended by
    inserting after the item relating to section 5136A (as added by section
    240(d) of this title) the following new item:

    ``5136B. Insurance sales in empowerment zones.''.
    SEC. 242. AUTHORIZING BANK SERVICE COMPANIES TO ORGANIZE AS LIMITED
                        LIABILITY PARTNERSHIPS.

      (a) Amendment to Short Title.--Section 1 of the Bank Service
    Corporation Act (12 U.S.C. 1861(a)) is amended by striking subsection
    (a) and inserting the following new subsection:
      ``(a) Short Title.--This Act may be cited as the `Bank Service
    Company Act'.'';
      (b) Amendments to Definitions.--Section 1(b) of the Bank Service
    Corporation Act (12 U.S.C. 1861(b)) is amended--
              (1) by striking paragraph (2) and inserting the following new
            paragraph:
              ``(2) the term `bank service company' means--
                      ``(A) any corporation--
                              ``(i) which is organized to perform services
                            authorized by this Act; and
                              ``(ii) all of the capital stock of which is
                            owned by 1 or more insured banks; and
                      ``(B) any limited liability company--
                              ``(i) which is organized to perform services
                            authorized by this Act; and
                              ``(ii) all of the members of which are 1 or
                            more insured banks.'';
              (2) in paragraph (6)--
                      (A) by striking ``corporation'' and inserting
                    ``company''; and
                      (B) by striking ``and'' after the semicolon;
              (3) by redesignating paragraph (7) as paragraph (8) and
            inserting after paragraph (6) the following new paragraph:
              ``(7) the term `limited liability company' means any company
            organized under the law of a State (as defined in section 3 of
            the Federal Deposit Insurance Act) which provides that a member
            or manager of such company is not personally liable for a debt,
            obligation, or liability of the company solely by reason of
            being, or acting as, a member or manager of such company;
            and''; and
              (4) in paragraph (8) (as so redesignated)--
                      (A) by striking ``corporation'' each place such term
                    appears and inserting ``company''; and
                      (B) by striking ``capital stock'' and inserting
                    ``equity''.
      (c) Amendments to Section 2.--Section 2 of the Bank Service
    Corporation Act (12 U.S.C. 1862) is amended--
              (1) by striking ``corporation'' and inserting ``company'';
              (2) by striking ``corporations'' and inserting ``companies'';
            and
              (3) in the heading for such section, by striking
            ``corporation'' and inserting ``company''.
      (d) Amendments to Section 3.--Section 3 of the Bank Service
    Corporation Act (12 U.S.C. 1863) is amended--
              (1) by striking ``corporation'' each place such term appears
            and inserting ``company''; and
              (2) in the heading for such section, by striking
            ``corporation'' and inserting ``company''.
      (e) Amendments to Section 4.--Section 4 of the Bank Service
    Corporation Act (12 U.S.C. 1864) is amended--
              (1) by striking ``corporation'' each place such term appears
            and inserting ``company'';
              (2) in subsection (b), by inserting ``or members'' after
            ``shareholders'' each place such term appears;
              (3) in subsections (c) and (d), by inserting ``or member''
            after ``shareholder'' each place such term appears;
              (4) in subsection (e)--
                      (A) by inserting ``or members'' after ``national bank
                    and State bank shareholders'';
                      (B) by striking ``its national bank shareholder or
                    shareholders'' and inserting ``any shareholder or
                    member of the company which is a national bank'';
                      (C) by striking ``its State bank shareholder or
                    shareholders'' and inserting ``any shareholder or
                    member of the company which is a State bank'';
                      (D) by striking ``such State bank or banks'' and
                    inserting ``any such State bank''; and
                      (E) by inserting ``or members'' after ``State bank
                    and national bank shareholders'';
              (5) in subsection (f), by inserting ``or providing insurance
            as principal, agent, or broker (except to the extent permitted
            under subparagraph (A) or (E) of section 4(c)(8) of the Bank
            Holding Company Act of 1956)'' after ``or deposit taking''; and
              (6) in the heading for such section, by striking
            ``corporation'' and inserting ``company''.
      (f) Amendments to Section 5.--Section 5 of the Bank Service
    Corporation Act (12 U.S.C. 1865) is amended--
              (1) by striking ``corporation'' each place such term appears
            and inserting ``company''; and
              (2) in the heading for such section, by striking
            ``corporations'' and inserting ``companies''.
      (g) Amendments to Section 6.--Section 6 of the Bank Service
    Corporation Act (12 U.S.C. 1866) is amended--
              (1) by striking ``corporation'' each place such term appears
            and inserting ``company'';
              (2) by inserting ``or is not a member of'' after ``does not
            own stock in'';
              (3) by striking ``the nonstockholding institution'' and
            inserting ``such depository institution'';
              (4) by inserting ``or is a member of'' after ``that owns
            stock in'';
              (5) in paragraphs (1) and (2), by inserting ``or nonmember''
            after ``nonstockholding''; and
              (6) in the heading for such section by inserting ``or
            nonmembers'' after ``nonstockholders''.
      (h) Amendments to Section 7.--Section 7 of the Bank Service
    Corporation Act (12 U.S.C. 1867) is amended--
              (1) by striking ``corporation'' each place such term appears
            and inserting ``company'';
              (2) in subsection (a)--
                      (A) by inserting ``or principal member'' after
                    ``principal shareholder''; and
                      (B) by inserting ``or member'' after ``other
                    shareholder''; and
              (3) in the heading for such section, by striking
            ``corporations'' and inserting ``companies''.
    SEC. 243. BANK INVESTMENTS IN EDGE ACT AND AGREEMENT CORPORATIONS.

      The 10th undesignated paragraph of section 25A of the Federal Reserve
    Act (12 U.S.C. 618) is amended by striking the last sentence and
    inserting the following: ``Any national bank may invest in the stock of
    any corporation organized under this section. The aggregate amount of
    stock held by any national bank in all corporations engaged in business
    of the kind described in this section or section 25 shall not exceed an
    amount equal to 10 percent of the capital and surplus of such bank
    unless the Board determines that the investment of an additional amount
    by the bank would not be unsafe or unsound and, in any case, shall not
    exceed an amount equal to 25 percent of the capital and surplus of such
    bank.''.

    SEC. 244. REPORT ON THE RECONCILIATION OF DIFFERENCES BETWEEN
                        REGULATORY ACCOUNTING PRINCIPLES AND GENERALLY
                        ACCEPTED ACCOUNTING PRINCIPLES.

      Before the end of the 180-day period beginning on the date of the
    enactment of this Act, each appropriate Federal banking agency (as
    defined in section 3 of the Federal Deposit Insurance Act) shall submit
    to the Committee on Banking and Financial Services of the House of
    Representatives and the Committee on Banking, Housing, and Urban
    Affairs of the Senate a report on the actions taken and to be taken by
    the agency to eliminate or conform inconsistent or duplicative
    accounting and reporting requirements applicable to reports or
    statements filed with any such agency by insured depository
    institutions, as required by section 121 of the Federal Deposit
    Insurance Corporation Improvement Act of 1991.

    SEC. 245. WAIVERS AUTHORIZED FOR RESIDENCY REQUIREMENT FOR NATIONAL
                        BANK DIRECTORS.

      The 1st sentence of section 5146 of the Revised Statutes of the
    United States (12 U.S.C. 72) is amended by inserting ``(1) the
    Comptroller of the Currency may, in the Comptroller's discretion, waive
    the residency requirement in the case of any director of a national
    bank to whom the requirement would otherwise apply, and (2)'' after
    ``except that''.

                          TITLE III--LENDER LIABILITY

    SEC. 301. LENDER LIABILITY.

      (a) In General.--The Federal Deposit Insurance Act (12 U.S.C. 1811 et
    seq.) is amended by adding after section 44, the following new section:

    ``SEC. 45. LENDER, FIDUCIARY, AND GOVERNMENT AGENCY ENVIRONMENTAL
                        LIABILITIES.

      ``(a) Lender Environmental Liability.--
              ``(1) In general.-- Notwithstanding any other provision or
            rule of Federal law, no lender, acting as defined in this
            section, shall be liable pursuant to a Federal environmental
            law, except as provided in this section.
              ``(2) Actual participation required.--A lender shall only be
            liable pursuant to a Federal environmental law when the lender
            actually participates in management of another person's
            activities which create liability under the same Federal
            environmental law.
              ``(3) Definitions.--The following definitions shall apply for
            purposes of this section:
                      ``(A) Participate in management.--The term
                    `participate in management' means actually
                    participating in the management or operational affairs
                    of other persons' activities, and does not include
                    merely having the capacity to influence, or the
                    unexercised right to control such activities;
                      ``(B) Participate in management.--A person shall be
                    considered to `participate in management' while a
                    borrower is still in possession of property, only if
                    such person--
                              ``(i) exercises decisionmaking control over
                            the environmental compliance of a borrower,
                            such that the person has undertaken
                            responsibility for the hazardous substance
                            handling or disposal practices of the borrower;
                            or
                              ``(ii) exercises control at a level
                            comparable to that of a manager of the
                            enterprise of the borrower, such that the
                            person has assumed or manifested responsibility
                            for the overall management of the enterprise
                            encompassing day-to-day decisionmaking with
                            respect to environmental compliance, or with
                            respect to substantially all of the operational
                            aspects (as distinguished from financial or
                            administrative aspects) of the enterprise,
                            other than environmental compliance.
                      ``(C) Participate in management.--The term
                    `participate in management' does not include engaging
                    in an act or failing to act before the time that an
                    extension of credit is made or a security interest is
                    created in property.
                      ``(D) Participate in management.--The term
                    `participate in management' does not include, unless
                    such actions rise to the level of participating in
                    management (as defined in subparagraphs (A) and (B))--
                              ``(i) holding an extension of credit or a
                            security interest or abandoning or releasing an
                            extension of credit or a security interest;
                              ``(ii) including in the terms of an extension
                            of credit, or in a contract or security
                            agreement relating to such an extension,
                            covenants, warranties, or other terms and
                            conditions that relate to environmental
                            compliance;
                              ``(iii) monitoring or enforcing the terms and
                            conditions of an extension of credit or
                            security interest;
                              ``(iv) monitoring or undertaking 1 or more
                            inspections of property, except that monitoring
                            or undertaking any such inspection, although
                            not required by this subsection, shall provide
                            probative evidence that a holder of a security
                            interest is acting to preserve and protect the
                            property during the time the holder may have
                            possession or control of such property;
                              ``(v) requiring or conducting a response
                            action or other lawful means of addressing the
                            release or threatened release of a hazardous
                            substance in connection with property prior to,
                            during, or upon the expiration of the term of
                            an extension of credit;
                              ``(vi) providing financial or other advice or
                            counseling in an effort to mitigate, prevent,
                            or cure default or diminution in the value of
                            the property;
                              ``(vii) restructuring, renegotiating, or
                            otherwise agreeing to alter the terms and
                            conditions of an extension of credit or
                            security interest, or exercising forbearance;
                            or
                              ``(viii) exercising other remedies that may
                            be available under applicable law for the
                            breach of any term or condition of the
                            extension of credit or security agreement.
                      ``(E) When a lender did not participate in management
                    of property prior to foreclosure, then the lender shall
                    not be liable even if such person forecloses on
                    property, sells, re-leases, or liquidates property,
                    maintains business activities, winds up operations, or
                    undertakes any response action with respect to
                    property, or takes other measures to preserve, protect,
                    or prepare property prior to sale or disposition, if
                    such person seeks to sell, release, or otherwise divest
                    the property at the earliest practical, commercially
                    reasonable time, on commercially reasonable terms,
                    taking into account market conditions and legal and
                    regulatory requirements.
              ``(4) Limitation on liability.--The liability of any lender
            that is liable under any Federal environmental law shall be
            limited to only the cost of any response action or corrective
            action to the extent and in the amount that the lender actively
            and directly contributed to the hazardous substance release. A
            lender shall not be liable for the cost of any response action
            or corrective action relating to the release of a hazardous
            substance which commences before and continues after the lender
            obtains a security interest in the property so long as the
            lender does not actively and directly contribute to the
            hazardous substance release.
      ``(b) Fiduciary Environmental Liability.--
              ``(1) In general.-- Notwithstanding any other provision or
            rule of Federal law, no fiduciary, acting as defined in this
            section, shall be liable pursuant to any Federal environmental
            law, except as provided in this section.
              ``(2) Liability of fiduciary.--
                      ``(A) Subject to subparagraphs (B) and (C), a
                    fiduciary holding title to property or otherwise
                    affiliated with property solely in a fiduciary capacity
                    shall be personally subject to the obligations and
                    liabilities of any person under any Federal
                    environmental law, to the same extent as if the
                    property were held by the fiduciary free of trust.
                      ``(B) The personal obligations and liabilities of a
                    fiduciary referred to in subparagraph (A) shall be
                    limited to the extent to which the assets of the trust
                    or estate are sufficient to indemnify the fiduciary,
                    unless--
                              ``(i) the obligations and liabilities would
                            have arisen even if the person had not served
                            as a fiduciary;
                              ``(ii) the fiduciary's own failure to
                            exercise due care with respect to property
                            caused or contributed to the release of
                            hazardous substances following establishment of
                            the trust, estate, or fiduciary relationship;
                            or
                              ``(iii) the fiduciary had a role in
                            establishing the trust, estate, or fiduciary
                            relationship, and such trust, estate, or
                            fiduciary relationship has no objectively
                            reasonable or substantial purpose apart from
                            the avoidance or limitation of liability under
                            an environmental law.
                    Nothing in the preceding sentence shall be construed as
                    requiring indemnification by an employee benefit plan
                    (within the meaning of paragraph (3) of section 3 of
                    Employee Retirement Income Security Act of 1974), or by
                    any trust forming a part thereof, of any fiduciary of
                    such plan contrary to the terms of the plan or in an
                    amount in excess of the amount permitted under the
                    terms of such plan.
                      ``(C) A fiduciary shall not be personally liable for
                    undertaking or directing another to undertake a
                    response action.
              ``(3) Rule of construction.--No provision of this subsection
            shall be construed as affecting the liability, if any, of any
            person who--
                      ``(A)(i) acts in a capacity other than a fiduciary
                    capacity; and
                      ``(ii) directly or indirectly benefits from a trust
                    or fiduciary relationship; or
                      ``(B)(i) is a beneficiary and a fiduciary with
                    respect to the same fiduciary estate; and
                      ``(ii) as a fiduciary, receives benefits that exceed
                    customary or reasonable compensation, and incidental
                    benefits, permitted under other applicable laws.
      ``(c) Definitions.--For purposes of subsections (a) and (b), the
    following definitions shall apply:
              ``(1) Federal environmental law.--The term `Federal
            environmental law' means any Federal statute or rule of common
            law with the purpose of protection of the environment and any
            Federal regulation promulgated thereunder and any State statute
            or regulation created as a federally approved or delegated
            program implementing these laws, including the following:
                      ``(A) The Federal Insecticide, Fungicide, and
                    Rodenticide Act (7 U.S.C. 136 et seq.).
                      ``(B) The Toxic Substances Control Act (15 U.S.C.
                    2601 et seq.).
                      ``(C) The Federal Water Pollution Control Act (33
                    U.S.C. 1251 et seq.).
                      ``(D) The Oil Pollution Act of 1990 (33 U.S.C. 2701
                    et seq.).
                      ``(E) The Clean Air Act (42 U.S.C. 7401 et seq.).
                      ``(F) The Solid Waste Disposal Act (42 U.S.C. 6901 et
                    seq.).
                      ``(G) The Comprehensive Environmental Response,
                    Compensation, and Liability Act of 1980 (42 U.S.C. 9601
                    et seq.).
                      ``(H) The Pollution Prevention Act of 1990 (42 U.S.C.
                    13101 et seq.).
              ``(2) Extension of credit.--The term `extension of credit'
            means the making or renewal of any loan, a granting of a line
            of credit or extending credit in any manner, such as an advance
            by means of an overdraft or the issuance of a standby letter of
            credit, and a lease finance transaction--
                      ``(A) in which the lessor does not initially select
                    the leased property and does not, during the lease
                    term, control the daily operation or maintenance of the
                    property; or
                      ``(B) that conforms with regulations issued by the
                    appropriate Federal banking agency or the appropriate
                    State bank supervisory (as these terms are defined in
                    section 3 of the Federal Deposit Insurance Act or with
                    regulations issued by the National Credit Union
                    Administration Board, as appropriate.
              ``(3) Fiduciary.--The term `fiduciary' means a person who
            acts for the exclusive benefit of another person as a bona fide
            fiduciary within the meaning of section 3(21) of the Employee
            Retirement Income Security Act of 1974, trustee, executor,
            administrator, custodian, guardian, conservator, receiver,
            committee of estates of lunatics or other disabled persons, or
            personal representative; except, that the term `fiduciary' does
            not include any person--
                      ``(A) who owns, or controls, is affiliated with, or
                    takes any action with respect to property on behalf of
                    or for the benefit of a lender or takes any action to
                    protect a lender's extension of credit or security
                    interest (any such person shall be treated as a lender
                    under subsection (a) of this section); or
                      ``(B) who is acting as a fiduciary with respect to a
                    trust or other fiduciary estate that--
                              ``(i) was not created as part of, or to
                            facilitate, one or more estate plans or
                            pursuant to the incapacity of a natural person;
                            and
                              ``(ii) was organized for the primary purpose
                            of, or is engaged in, actively carrying on a
                            trade or business for profit.
              ``(4) Financial or administrative aspect.--The term
            `financial or administrative aspect' means a function such as a
            credit manager, accounts payable officer, accounts receivable
            officer, personnel manager, comptroller, or chief financial
            officer, or any similar function.
              ``(5) Foreclosure, foreclose.--The terms `foreclosure' and
            `foreclose' means, respectively, acquiring, and to acquire,
            property through--
                      ``(A) purchase at sale under a judgment or decree, a
                    power of sale, a nonjudicial foreclosure sale, or from
                    a trustee, deed in lieu of foreclosure, or similar
                    conveyance, or through repossession, if such property
                    was security for an extension of credit previously
                    contracted;
                      ``(B) conveyance pursuant to an extension of credit
                    previously contracted, including the termination of a
                    lease agreement; or
                      ``(C) any other formal or informal manner by which
                    the person acquires, for subsequent disposition,
                    possession of collateral in order to protect the
                    security interest of the person.
              ``(6) Hazardous substance.--The term `hazardous substance'
            means any chemical, biological, organic, inorganic, or
            radioactive pollutants, contaminants, materials, waste, or
            other substances regulated under, defined, listed, or included
            in any Federal environmental law.
              ``(7) Lender.--The term `lender' means--
                      ``(A) a person that makes a bona fide extension of
                    credit to or takes a security interest from another
                    person and includes a successor or assign of the person
                    which makes the extension of credit or takes the
                    security interest;
                      ``(B) the Federal National Mortgage Association, the
                    Federal Home Loan Mortgage Corporation, the Federal
                    Agricultural Mortgage Corporation, or other entity that
                    in a bona fide manner is engaged in the business of
                    buying or selling loans on interests therein;
                      ``(C) any person engaged in the business of insuring
                    or guaranteeing against a default in the repayment of
                    an extension of credit, or acting as a surety with
                    respect to an extension of credit, to other persons; or
                      ``(D) any person regularly engaged in the business of
                    providing title insurance who acquires property as a
                    result of assignment or conveyance in the course of
                    underwriting claims and claims settlement.
              ``(8) Operational aspect.--The term `operational aspect'
            means a function such as a facility or plant manager,
            operations manager, chief operating officer, or chief executive
            officer.
              ``(9) Person.--The term `person' means an individual, firm,
            corporation, association, partnership, consortium, joint
            venture, commercial entity, United States Government, State,
            municipality, commission, political subdivision of a State, or
            any interstate body.
              ``(10) Property.--The term `property' means real, personal,
            and mixed property.
              ``(11) Response action.--The term `response action' shall
            have the same meaning as that term is defined in section 101 of
            the Comprehensive Environmental Response, Compensation and
            Liability Act.
              ``(12) Security interest.--The term `security interest' means
            a right under a mortgage, deed of trust, assignment, judgment
            lien, pledge, security agreement, factoring agreement, or
            lease, or any other right accruing to a person to secure the
            repayment of money, the performance of a duty, or some other
            obligation.
      ``(d) Savings Clause.--Nothing in subsections (a) (b), or (c),
    shall--
              ``(1) affect the rights or immunities or other defenses that
            are already available to lenders or fiduciaries under any
            Federal environmental law;
              ``(2) be construed to create any liability for any lender or
            fiduciary; or
              ``(3) create a private right of action against any lender or
            fiduciary.
      ``(e) Federal Banking and Lending Agency Environmental Liability.--
              ``(1) Governmental entities.--
                      ``(A) Banking and lending agencies.--Except as
                    provided in paragraph (C), a Federal banking or lending
                    agency shall not be liable under any law imposing
                    strict liability for the release or threatened release
                    of petroleum or a hazardous substance at or from
                    property (including any right or interest therein)
                    acquired--
                              ``(i) in connection with the exercise of
                            receivership or conservatorship authority, or
                            the liquidation or winding up of the affairs of
                            an insured depository institution, including
                            any of its subsidiaries, and bridge bank;
                              ``(ii) in connection with the provision of
                            loans, discounts, advances, guarantees,
                            insurance, or other financial assistance; or
                              ``(iii) in connection with property received
                            in any civil or criminal proceeding, or
                            administrative enforcement action, whether by
                            settlement or order.
                      ``(B) Application of state law.--Nothing in paragraph
                    (e) shall be construed as preempting, affecting,
                    applying to, or modifying any State law, or any rights,
                    actions, cause of action, or obligations under State
                    law, except that liability under State law shall not
                    exceed the value of the agency's interest in the asset
                    giving rise to such liability. Nothing in this section
                    shall be construed to prevent a Federal banking or
                    lending agency from agreeing with a State to transfer
                    property to such State in lieu of any liability that
                    might otherwise be imposed under State law.
                      ``(C) Limitation.--Notwithstanding paragraph (A), and
                    subject to section 107(d) of the Comprehensive
                    Environmental Response, Compensation, and Liability Act
                    of 1980, a Federal banking or lending agency that
                    directly caused or materially contributed to the
                    release of petroleum or a hazardous substance may be
                    liable for removal, remedial, or other response action
                    pertaining to that release.
                      ``(D) Subsequent purchaser.--The immunity provided by
                    paragraphs (A) and (B) shall extend to the first
                    subsequent purchaser of property described in such
                    paragraph from a Federal banking or lending agency,
                    unless such purchaser--
                              ``(i) would otherwise be liable or
                            potentially liable for all or part of the costs
                            of the removal, remedial, or other response
                            action due to a prior relationship with the
                            property;
                              ``(ii) is or was affiliated with or related
                            to a party described in subparagraph (i);
                              ``(iii) fails to agree to take reasonable
                            steps necessary to abate the release or
                            threatened release or to protect public health
                            and safety in a manner consistent with the
                            purposes of applicable Federal environmental
                            laws; or
                              ``(iv) directly causes or significantly and
                            materially contributes to any additional
                            release or threatened release on the property.
                      ``(E) Federal or state action.--Notwithstanding
                    subparagraph (D), if a Federal agency or State
                    environmental agency is required to take remedial
                    action due to the failure of a subsequent purchaser to
                    carry out, in good faith, the agreement described in
                    subparagraph (D)(iii), such subsequent purchaser shall
                    reimburse the Federal or State environmental agency for
                    the costs of such remedial action. Any such
                    reimbursement shall not exceed the increase in the fair
                    market value of the property attributable to the
                    remedial action.
              ``(2) Lien exemption.--Notwithstanding any other provision of
            law, any property held by a subsequent purchaser referred to in
            paragraph (1)(D) or held by a Federal banking or lending agency
            shall not be subject to any lien for costs or damages
            associated with the release or threatened release of petroleum
            or a hazardous substance existing at the time of the transfer.
              ``(3) Exemption from covenants to remediate.--A Federal
            banking or lending agency shall be exempt from any law
            requiring such agency to grant covenants warranting that a
            removal, remedial, or other response action has been, or will
            in the future be, taken with respect to property acquired in
            the manner described in paragraph (e)(1)(A).
              ``(4) Definitions.--For purposes of subsection (e), the
            following definitions shall apply:
                      ``(A) Federal banking or lending agency.--The term
                    `Federal banking or lending agency' means the
                    Corporation, the Resolution Trust Corporation, the
                    Board of Governors of the Federal Reserve System, the
                    Comptroller of the Currency, the Office of Thrift
                    Supervision, a Federal Reserve Bank, a Federal Home
                    Loan Bank, the Department of Housing and Urban
                    Development, the National Credit Union Administration
                    Board, the Farm Credit Administration, the Farm Credit
                    System Insurance Corporation, the Farm Credit System
                    Assistance Board, the Farmers Home Administration, the
                    Rural Electrification Administration, the Small
                    Business Administration, and any other Federal agency
                    acting in a similar capacity, in any of their
                    capacities, and their agents or appointees.
                      ``(B) Hazardous substance.--The term `hazardous
                    substance' has the same meaning as in section 101(14)
                    of the Comprehensive Environmental Response,
                    Compensation, and Liability Act of 1980.
                      ``(C) Release.--The term `release' has the same
                    meaning as in section 101(22) of the Comprehensive
                    Environmental Response, Compensation, and Liability Act
                    of 1980, and includes the use, storage, disposal,
                    treatment, generation, or transportation of a hazardous
                    substance.
              ``(5) Savings clause.--Nothing in subsection (e) shall--
                      ``(A) affect the rights or immunities or other
                    defenses that are available under this Act or other
                    applicable law to any party, subject to the provisions
                    of this section;
                      ``(B) be construed to create any liability for any
                    party; or
                      ``(C) create a private right of action against an
                    insured depository institution or lender or against a
                    Federal banking or lending agency.''.
      (b) Effective Date.--This section shall take effect upon the date of
    the enactment of this Act and shall apply to any claim against any
    lender, fiduciary, or government agency under any Federal environmental
    law that has not been finally resolved by adjudication or settlement
    before such date.
        TITLE IV--ANNUAL STUDY AND REPORT ON IMPACT ON LENDING TO SMALL
                                    BUSINESS

    SEC. 401. ANNUAL STUDY AND REPORT.

      Not later than 12 months after the date of the enactment of this Act,
    and annually thereafter, the Board of Governors of the Federal Reserve
    System, the Director of the Office of Thrift Supervision, the
    Comptroller of the Currency, and the Board of Directors of the Federal
    Deposit Insurance Corporation shall jointly conduct a study and submit
    to the Congress a report on the extent to which this Act and the
    amendments made by this Act have, through reductions in regulatory
    burdens, resulted in increased lending to small businesses.
                      Background and Need for Legislation

        The Financial Institutions Regulatory Relief Act of 1995
    advances the effort begun by the 102nd Congress to remove
    unnecessary and redundant regulations imposed on the nation's
    financial institutions without affecting safety and soundness.
    Over the past 25 years, a variety of new laws and regulations
    in the areas of safety and soundness and consumer protections
    has been imposed on financial institutions. Over the course of
    time, however, some of these laws and regulations have proven
    to be duplicative and counterproductive causing bank resources
    to be dedicated to costly paperwork and compliance review
    processes instead of commercial and consumer lending. Needless
    regulations result in inefficiency and increased costs to both
    financial institutions and consumers. In addition, the added
    cost of regulation produces disintermediation--the movement of
    savings dollars from traditional federally insured institutions
    to other venues where regulatory requirements are less
    burdensome and thus less costly. Ironically, the volume of
    information required to be provided to consumers under the
    numerous Federal consumer protection laws is so overwhelming
    that consumers are frequently more confused than informed. By
    removing excessive regulation this legislation is designed to
    encourage operational efficiency and to support the
    competitiveness of financial institutions without compromising
    the safety and soundness mechanisms or consumer protections
    required to uphold the integrity of the U.S. banking system.
        The complex regulatory environment of the early 1990s
    evolved in response to a variety of problems that occurred in
    financial markets during the 1970s and 1980s, including the
    savings and loans crisis. In an effort to respond to economic
    immediacies, Congress enacted a series of statutes designed to
    improve the supervision of savings associations and to curtail
    investments and other activities that posed unacceptable risks
    to the Federal deposit insurance funds.
        While it is clear that many of the safety and soundness
    provisions enacted as a result of the financial conditions in
    the 1980s, such as those mandating strong capital requirements
    and accurate accounting standards, are necessary, other
    provisions are generally considered to be unnecessary burdens
    by regulators and the banking industry. In addition, these
    legislative actions were followed by an avalanche of
    implementing regulations that have overwhelmed the management
    of many depository institutions regardless of size.
        Other significant factors in the growth of regulatory
    burden are the numerous Federal consumer protection laws
    enacted by Congress. These statutes include the Real Estate
    Settlement Procedures Act of 1977 (RESPA), the Truth in Lending
    Act (TILA), the Home Mortgage Disclosure Act (HMDA), the Equal
    Credit Opportunity Act (ECOA), the Fair Credit Reporting Act
    (FCRA), the Fair Housing Act (FHA), the Electronic Fund
    Transfer Act (EFTA), and the Fair Debt Collection Practices Act
    (FDCPA). Again, while the objectives of these laws may be
    worthwhile, implementation of these and other new requirements
    has increased reporting, disclosure, and recordkeeping which,
    in turn, has increased the cost of extending credit and
    offering deposit products. Moreover, experience has shown that
    inundating consumers with a countless array of documents
    written in legal, technical language generally fails to provide
    consumers with the types of useful information intended by the
    above laws.
        As a result of all of these statutory and regulatory
    developments, depository institutions today bear a heavy
    regulatory burden. Three years ago, the banking industry
    estimated that the cost of compliance was into the billions of
    dollars. Various other studies over the past few years have
    estimated that compliance with regulatory requirements imposes
    significant direct costs on banks, some portion of which is
    passed on to the consumer. At times, the burden falls
    disproportionately on insured banks and thrifts, as compared
    with other types of financial institutions. Given the increased
    competition in the financial services market from nonbank
    entities not subject to federal regulations, regulatory burdens
    should not unnecessarily place banks at a competitive
    disadvantage.
        It is also important to recognize that regulatory burden
    generally has a significantly greater impact on smaller
    institutions. For example, one-quarter of the banks supervised
    by the Federal Deposit Insurance Corporation (FDIC) have fewer
    than 13 employees on a full-time basis. A labor force of this
    size cannot deal with the complexity and sheer volume of
    regulatory and legislative requirements, whereas larger
    institutions can more easily integrate such requirements into
    their business operations.
        In short, the need for this legislation arises from the
    fact that the regulatory environment is too complex, the cost
    compliance is too high, and the resulting competitive
    disadvantages facing financial institutions are too great. In
    order to ensure the integrity, the competitiveness, and the
    continued success of the nation's banking system, certain
    legislative action must be taken to reduce the unnecessary
    regulatory burdens currently imposed on financial institutions.

                              Purpose and Summary

        The purpose of this legislation is to streamline,
    rationalize, and modernize the regulation of financial
    institutions and to maintain the safety and soundness of the
    nation's financial systems and necessary consumer protections.
    This threefold objective is principally achieved by removing
    unnecessary reporting, disclosure, or recordkeeping
    requirements or by making appropriate modifications thereto. By
    reducing regulatory burdens, this legislation strives to
    significantly lower the cost of compliance and to promote
    competition among all types of financial institutions both
    within and outside of the United States. At the same time, this
    legislation deliberately preserves the legislative safeguards
    already in law that pertain to safety and soundness and
    consumer protection. This legislation, ultimately, is intended
    to provide the consumer with greater choices and lower prices
    for financial products and services.

                Title I--Reductions in Government Overregulation

                     subtitle a--the home mortgage process

    1. Rationalizing the home mortgage lending process

        Government overregulation of the nation's home mortgage
    lending process has resulted in higher costs, excessive
    paperwork, and consumer frustration to the detriment of both
    financial institutions and consumers. Legislation is needed to
    rationalize the regulatory framework that governs the home
    mortgage lending process in order to eliminate unnecessary
    costs, burdens, and complexity while providing more useful
    information to consumers.
        Currently, the home mortgage lending process is governed by
    the TILA and the RESPA. The TILA was enacted to enable
    consumers to shop comparatively for consumer credit by
    requiring lenders to disclose interest rates and other
    information about credit terms and costs in a uniform way. The
    TILA governs disclosures required for all consumer credit
    transactions, a uniform way. The TILA governs disclosures
    required for all consumer credit transactions, including home
    mortgages. The RESPA was enacted to ensure that consumers are
    provided with greater and more timely information on the nature
    and costs of the real estate settlement process and are
    protected from unnecessarily high settlement charges and fees.
        Under this system of dual supervision, there is
    considerable overlap in regulatory requirements, especially
    with respect to disclosure statements. Duplicative disclosure
    statements unnecessarily increase the costs of compliance and
    ultimately lessen the financial institution's ability to engage
    in mortgage lending. Moreover, redundancy in disclosure
    statements is frequently confusing to the consumer and often
    needlessly complicates the settlement process. In order to
    reduce the statutory overlap and to eliminate unnecessary
    paperwork, this legislation would transfer rulemaking authority
    relating to the disclosure provisions under the RESPA from the
    Department of Housing and Urban Development (HUD) to the
    Federal Reserve Board, which currently has rulemaking authority
    under the TILA. Furthermore, this legislation mandates the
    Board to reconcile differences between the disclosure
    provisions found in the TILA and the RESPA, to simplify
    disclosures, including the timing thereof, and to create a
    single format for such disclosures. These changes would reduce
    compliance costs and provide more meaningful information to the
    consumer.
        The current enforcement structure with regard to
    disclosures under the RESPA and the TILA is also problematic.
    Not only do these statutes have two different mechanisms for
    providing similar information in real estate transactions, but
    they are presently interpreted by two different regulators. By
    transferring interpretive authority for RESPA disclosures to
    the Board, along with instructions to eliminate duplicative and
    unnecessary requirements, real estate transactions will be
    greatly simplified.
        All other sections of RESPA pertaining to settlement
    services, including section 8, remain under the jurisdiction of
    HUD. In light of the fact that HUD is currently not providing
    any clear and consistent regulatory guidance to settlement
    service providers under RESPA, this legislation requires HUD to
    utilize a negotiated rulemaking process provided for under the
    Negotiated Rulemaking Act of 1990 before proceeding with any
    additional proposed and final rules under Sections 8 and 9 of
    the RESPA. Negotiated rulemaking will ensure that the concerns
    of all parties are expressed before HUD issues any rules
    regarding real estate settlement issues.
        Enforcement of the settlement service sections of RESPA are
    retained under HUD authority with regard to non-banking
    entities and are transferred to the appropriate federal banking
    agencies for banking organizations. Additionally, in situations
    where numerous enforcement agencies are involved, agencies are
    required to coordinate their enforcement activities in order to
    assure that institutions are subject to the same rules of law
    and enforcement policies.

    2. Recent Truth in Lending Act litigation (``Rodash'')

        This legislation also addresses the United States Court of
    Appeals for the Eleventh Circuit's decision in Rodash v. AIB
    Mortgage Co., 16 F.3d 1142 (11th Cir. 1994), a case involving
    the TILA. The TILA requires lenders to disclose credit terms to
    borrowers in a manner that allows them to compare objectively
    various credit products. For example, the TILA requires lenders
    to characterize certain charges associated with a loan as
    ``finance charges'' and requires them to aggregate all such
    charges into one ``finance charge'' to be disclosed at real
    estate closings. The TILA allows borrowers to rescind
    transactions even for technical violations of the disclosure
    provisions of the statute.
        On March 21, 1994, the court in Rodash v. AIB, ruled that
    certain taxes and fees (a $20 Federal Express delivery charge),
    including some fees that are assessed by third parties other
    than the lender, must be characterized as ``finance charges''
    under the TILA. Because of this technical violation, the
    borrower was able to rescind the mortgage. When a mortgage is
    rescinded, the borrower is released from the mortgage lien
    leaving the lender with the unsecured loan moreover, the
    borrower is entitled to repayment of interest and all other
    non-principal payments made on the loan.
        The Eleventh Circuit's ruling has sparked numerous class
    action lawsuits against lenders who have not characterized or
    disclosed such taxes and fees as ``finance charges'' in the
    past. It is argued that Rodash could have disastrous
    consequences for both organizers of mortgage loans and the
    secondary market. The potential cost of rescinding all
    refinanced mortgages made in the last three years (the time
    allowed under TILA to exercise the rescission right) has been
    estimated to be as high as $217 billion.
        This issue was addressed by the House in the 103rd Congress
    by including the necessary corrective legislative language in a
    bill to amend the FCRA. That language, which was passed as part
    of H.R. 5178, would have expressly exempted from the definition
    of ``finance charge'' the types of taxes and fees that the
    Eleventh Circuit found objectionable. Although H.R. 5178 was
    passed by the House on November 5, 1994 by voice vote, it was
    not considered by the Senate.
        On April 4, 1995, with bipartisan support, the House under
    a suspension of the rules passed H.R. 1380, ``The Truth in
    Lending Class Action Relief Act of 1995.'' The Senate passed
    H.R. 1380 by unanimous consent on April 24, 1995. H.R. 1380
    imposes a moratorium until October 1, 1995 on certain TILA
    class action certifications, including Rodash-style class
    actions brought in connection with first liens on real property
    or dwellings that constitute a refinancing or consolidation of
    a debt.
        Again, this legislation reflects a bipartisan compromise.
    This legislation exempts a number of charges from inclusion in
    the ``finance charge'' and provides a tiered ``tolerance''
    approach on finance charge miscalculations. The legislation
    clarifies the applicability of the three year right of
    rescission for material nondisclosure, and precludes rescission
    for certain first-lien refinances. The legislation also
    contains limitations on the liability of assignees and services
    of home mortgages. It provides retroactive relief from
    liability for certain errors in disclosures with respect to
    certain individual cases and class actions.

               subtitle b--community reinvestment act amendments

        This legislation reaffirms the Community Reinvestment Act's
    (CRA) original intent to encourage financial institutions to
    reinvest in their communities, while not imposing comprehensive
    credit allocation dictates or unnecessary burdens on banks and
    savings associations. Under the current law, the CRA requires
    federal regulatory agencies to encourage financial institutions
    to meet the credit needs of their local communities consistent
    with the safe and sound operation of such institutions.
        Institutions are examined for CRA compliance and given one
    of four ratings: (i) ``substantial noncompliance'', (ii)
    ``needs to improve'', (iii) ``satisfactory'', or (iv)
    ``outstanding.'' Agencies consider these ratings when
    institutions apply to charter a bank or savings association, to
    relocate or establish a deposit facility, or to merge,
    consolidate or acquire assets of another institution.
        Enacted as part of the Housing and Community Development
    Act of 1977, the CRA was seen as a way to combat urban decay
    that was blamed in part on redlining (the practice of financial
    institutions intentionally not lending to certain neighborhoods
    or parts of a community). CRA was premised on the view that
    regulated institutions have a continuing obligation to meet the
    credit needs of their local communities in exchange for deposit
    insurance and a government charter.
        This legislation is designed to respond to many of the
    concerns that have been raised about the CRA and that were not
    addressed in the new inter-agency regulations. First, the
    legislation reemphasizes the original intent of the CRA not to
    impose added regulatory burden by explicitly prohibiting
    additional recordkeeping or reporting requirements unless such
    requirements reduce regulatory burden.
        Second, recognizing the inordinate regulatory impact of CRA
    compliance on small, community institutions and the fact that
    these institutions must meet the credit needs of their
    community in order to survive, the legislation permits
    institutions with less than $250 million in assets to self-
    certify compliance with the CRA in lieu of receiving an agency
    CRA evaluation. In general, banks with assets of $250 million
    or less typically do not have the resources for a full time CRA
    officer and cannot achieve the economies of scale in compliance
    efforts that billion dollar banks can achieve in developing and
    implementing CRA programs. The reasonableness of an
    institution's self-certification would be assessed during that
    institution's safety and soundness examination and would be
    based on information contained in the institution's public
    notice. Interested parties would be able to comment on an
    institution's performance and all comments would be maintained
    in the institution's public file. In addition, the legislation
    exempts an institution if it and its holding company in the
    aggregate have assets of $100 million or less from the
    requirements of the CRA. In rural communities, in particular,
    small banks lend to their community out of necessity as their
    continued existence depends upon a strong thriving community.
    In essence, small banks are already doing what the CRA
    requires, that is lending to their entire community.
        Third, for institutions with assets of $250 million or
    greater, the appropriate federal banking agency would still
    perform a full CRA evaluation of the institution. The inter-
    agency regulations adopted in April would still be applicable.
    The legislation, however, further reforms the CRA for large
    institutions by establishing a new mechanism for community
    input into an institution's CRA examination and further
    provides that CRA ratings for institutions receiving a
    ``satisfactory'' or ``outstanding,'' would be conclusive until
    the next examination.
        Under the present CRA system, all too often banks find that
    they do not hear from community advocates until the bank files
    a merger or acquisition application. Because of the delay and
    cost these protests add to the application process, many
    community groups have found it a highly effective method of
    ``encouraging'' institutions to enter into significant lending
    agreements in exchange for dropping the protest. Evidence
    suggests that CRA protests typically result in bank-sponsored
    targeted loan programs. The banks argue that they are being
    held ``hostage'' by community groups. The regulatory system is
    so flawed that even a bank with an ``outstanding'' CRA rating
    can find its CRA record challenged at the time it files an
    application.
        This legislation, by providing a procedure for community
    groups to respond to the institution's record of meeting its
    community needs in connection with the institution's
    examination rather than at the application stage, ensures that
    examiners will focus on the community issues raised by
    interested parties and encourages continuous dialogue between
    the institutions and the communities in which they serve.
        Fourth, in addition to the community comment period being
    moved from the application process to the CRA examination
    stage, the legislation also requires that an institution's CRA
    performance be assessed as part of, and at the same time as,
    the overall evaluation of the institutions. For those
    institutions that do not receive a satisfactory or outstanding
    rating, the regulators may take into account the institution's
    CRA record when evaluation the institution's condition. In
    addition, the institution's CFA rating may be determinative of
    whether or not an institution can take advantage of other
    benefits provided in law such as the streamlined applications
    procedures. This approach is more systematic and less
    disruptive to the business of banking.
         subtitle C--Consumer Banking Reforms--the Truth in Savings Act

        Enacted in 1991, the Truth in Savings Act (TISA) was
    intended to allow consumers to make a ``meaningful comparison
    between competing claims of depository institutions with regard
    to deposit accounts.'' Currently, under the TISA, financial
    institutions are required to disclose fees, interest rates, an
    annual percentage yield (APY) and other account terms through
    schedules and periodic disclosures for all checking and
    interest-bearing accounts they offer. A bank is subject to
    civil liability provisions if it fails to follow the strict and
    complicated disclosure requirements.
        Unfortunately, the disclosure requirements under TISA have
    caused depository institutions and bank regulators more
    compliance problems than they have provided useful information
    to savers. As was noted in testimony before the Subcommittee on
    Financial Institutions and Consumer Credit, it is ironic that a
    law aimed at providing consumers adequate information about
    interest rates in a simple understandable form, requires more
    than 200 pages of rules, covering 56 pages in the Federal
    Register.
        Instead of providing savers a better opportunity to compare
    ``apples with apples'' when choosing among a wide array of
    savings accounts, the Act and its implementing regulations have
    limited the kinds of accounts banks can offer and created a
    situation where savers are comparing ``apples with oranges.'' A
    January 1995 Federal Reserve study indicated that the TISA has
    not enhanced consumer awareness.
        H.R. 1858 addresses these concerns by eliminating certain
    provisions of the TISA which have caused the most compliance
    problems, such as the requirement to disclose an APY. The
    legislation does maintain, however, the beneficial provisions
    of the Act which require disclosure of fees, penalties, charges
    and the simple interest rate when an account is opened and when
    there is a change in terms relating to the required
    disclosures.

              subtitle D--Equal Credit Opportunity Act Amendments

        The goal of fair lending laws is to ensure that credit is
    not denied based on an individual's race, national origin, sex
    or age. One way to ensure that illegal discrimination is
    eradicated is to enlist the help of financial institutions in
    identifying and correcting discriminatory behavior. This
    legislation establishes a privilege for lenders who self-test
    for compliance with the ECOA and the FHA from having such tests
    used against them in any proceeding or civil action brought
    under these Acts where the lender has identified discriminatory
    practices and has taken appropriate corrective actions. It
    further grants Federal banking regulators discretionary
    authority to refer fair lending problems to the Attorney
    General or the Secretary of HUD under certain circumstances.

                  subtitle E--Consumer Leasing Act Amendments

        The purpose of this subtitle is to assure simple,
    meaningful disclosure of leasing terms to enable a consumer to
    comparison shop for leasing arrangements and to be protected
    from inaccurate and unfair leasing practices. The legislation
    instructs the Federal Reserve Board to address consumer leasing
    issues through regulation and requires the Board to publish
    model disclosure forms.

                 Title II--Streamlining Government Regulations

                     subtitle A--Regulatory Approval Issues

        In general, this title builds on the regulatory relief
    effort begun in the Riegle Community Development and Regulatory
    Improvement Act of 1994, which was enacted into law in the
    103rd Congress. H.R. 1858 eliminates a number of routine, but
    costly procedures and changes a number of overlapping and
    unnecessary requirements in current law, such as prior approval
    for the establishment of a domestic branch by institutions that
    operate safely and soundly. It also establishes expedited
    procedures for bank holding companies which are available only
    to companies that are well capitalized and well managed.
        Additionally, the title also removes per-branch capital
    requirements without affecting the consolidated capital
    requirements otherwise applicable to banks and amends the
    Depository Management Interlocks Act to allow sharing of
    management officials between small institutions in situations
    in which there would be no competitive impact. Finally, the
    legislation eliminates branch applications for automated teller
    machines (ATMs) and other duplicative approval requirements
    pertaining to mergers and divestitures and investments in bank
    premises as long as the investment does not exceed 150% of
    capital.

               subtitle B--streamlining of government regulations

    1. Branch closures

        The provisions included in this legislation substantially
    mirror the federal regulators' interagency policy statement on
    branch closings and would reduce regulatory burden by
    eliminating the need to give prior notice of decisions to close
    automated teller machines, to close or relocate branches that
    are within 2.5 miles of another branch of the same institution,
    and to close certain branches acquired through mergers.

    2. Insider lending

        This legislation makes minor changes to requirements
    governing insider lending. Specifically, the legislation amends
    the Federal Reserve Act to allow insiders of financial
    institutions to qualify for employee-wide benefit plans offered
    by their institutions. Additionally, the legislation allows
    executive officers to be eligible for home equity loans and
    loans secured by readily marketable assets but only within
    established limitations on amounts and on competitive terms.
    The legislation also removes unnecessary restrictions on loans
    to executive officers or directors of affiliates that represent
    less than ten percent of the assets of the holding company if
    the officers or directors do not participate in a major
    policymaking role in the bank.

    3. Insurance activities of national banks and bank holding companies

        The legislation includes a restriction on the power of the
    Office of the Comptroller of the Currency (OCC) to grant new
    insurance powers without rolling back the status quo. It also
    attends the Bank Holding Company Act (BHCA) to allow
    affiliations between banks and insurance companies under a
    holding company structure in accordance with state insurance
    laws. Such affiliations would be delayed until March 30, 1997.
    Additionally, national banks would be permitted to sell
    insurance within empowerment zones, subject to state
    regulation.

                          Title III--Lender Liability

        Title III provides clarity to the issue of liability of
    lenders, fiduciaries, and government agencies under Federal
    environmental laws. This clarification resolves the uncertainty
    of existing exemptions promulgated by the Environmental
    Protection Agency and, subsequently, overturned by judicial
    determination. The Court in United States v. Fleet Factors
    Corporation, 901 F.2d 1550 (11th Cir. 1990), cert. denied, 498
    U.S. 1046 (1991) decided that a lender could be held liable for
    the costs of any corrective or response action when the lender
    has the mere capacity to influence the borrower's treatment of
    hazardous waste. In addition, in United States v. Maryland Bank
    & Trusts Co., 632 F. Supp. 573 (D. Md. 1986), the Court held a
    lender liable for foreclosing on a contaminated property and
    later disposing of the property through sale. As a result of
    such judicial opinions, lenders are hesitant to make loans to
    certain borrowers and to foreclose on properties. Therefore,
    Title III addresses the issue of how and to what extent a
    lender can be held under environmental laws.
        Besides providing clarity to the liability issue, Title III
    provides encouragement and incentives to lenders and
    fiduciaries to protect the properties through environmental
    inspections and clean ups.
                                    Hearings

        The Subcommittee on Financial Institutions and Consumer
    Credit held two days of hearings on the CRA.
        Testifying before the Subcommittee on March 8, 1995 were:
    The Honorable Joseph P. Kennedy II, U.S. House of
    Representatives; The Honorable Ricki Helfer, Chairman, Federal
    Deposit Insurance Corporation; The Honorable Eugene A. Ludwig,
    Comptroller of the Currency; The Honorable Jonathan L.
    Fiechter, Acting Director, Office of Thrift Supervision; The
    Honorable Lawrence Lindsey, Governor, Federal Reserve System;
    Mr. William A. Niskanen, Chairman, the Cato Institute; Ms. Lucy
    H. Griffin, Compliance Management Services; Ms. Cathy Bessant,
    Senior Vice President, Nations Bank; Mr. Warren Traiger, CRA
    Practitioner; Mr. Ned Brown, Financial Modeling Concepts.
        Testifying before the Subcommittee on March 9, 1995 were:
    Mr. James Culberson, Jr., Chairman, First National Bank and
    Trust Company; Mr. Tony Abbate, Chairman, Marketing Committee,
    Independent Bankers Association; Mr. Mark Milligan, America's
    Community Bankers; Mr. Benson F. Roberts, Vice President for
    Policy, Local Initiatives Support Corporation; Ms. Michelle
    Meier, Counsel, Government Affairs, Consumers Union; Ms. Gale
    Cincotta, Chairperson, National People's Action; Mr. John E.
    Taylor, President and C.E.O., National Community Reinvestment
    Coalition; Mr. Allen Fishbein, General Counsel, Center for
    Community Change; Rev. Charles R. Stith, National President,
    Organization for a New Equality.
        The Subcommittee on Financial Institutions and Consumer
    Credit held four days of hearings on legislation to reduce the
    regulatory burdens being imposed on financial institutions,
    including H.R. 1362, introduced by Representative Bereuter.
        Testifying before the Subcommittee on May 18, 1995, were:
    The Honorable Richard Carnell, Assistant Secretary of Financial
    Institutions, Department of the Treasury; The Honorable Susan
    B. Phillips, Governor, Federal Reserve Board; The Honorable
    Ricki Helfer, Chairman, Federal Deposit Insurance Corporation;
    The Honorable Eugene A. Ludwig, Comptroller of the Currency;
    The Honorable Jonathan L. Fiechter, Acting Director, Office of
    Thrift Supervision; The Honorable Nicholas P. Retsinas,
    Assistant Secretary of Housing, Department of Housing and Urban
    Development; The Honorable Catherine Ghiglieri, Texas Banking
    Commissioner, representing the Conference of State Bank
    Supervisors.
        Testifying before the Subcommittee on May 23, 1995 were:
    Mr. James Culberson, Jr., American Bankers Association; Mr.
    Richard L. Mount, President, Independent Bankers Association of
    America; Mr. David Carson, America's Community Bankers; Mr. Ron
    Snellings, National Association of Federal Credit Unions; Ms.
    Nancy Pierce, Credit Union National Association, Inc.; Mr. H.
    Jay Sarles, Consumer Bankers Association; Mr. Alfred Pollard,
    Bankers Roundtable; Mr. John Davey, Mortgage Bankers
    Association of America; Mr. Rick Adams, National Association of
    Realtors; Mr. Larry Swank, National Association of Home
    Builders; Mr. Hank Williams, Real Estate Services Providers
    Council; Mr. Parker Kennedy, American Land Title Association.
        Testifying before the Subcommittee on May 24, 1995 were:
    The Honorable Maxine Waters, U.S. House of Representatives; Mr.
    Bart Harvey, The Enterprise Foundation; Dr. Francine Justa,
    Executive Director, Neighborhood Housing Services of New York
    City; Dr. Steven Roberts, Regulatory Advisory Practice, KPMG
    Peat Marwick LLP; Dr. Robert Edelstein, Walter A. Haas School
    of Business, University of California at Berkeley; Ms. Michelle
    Meier, Government Affairs Counsel, Consumers Union; Ms. Frances
    Smith, Director, Consumers Alert; Ms. Madeline Houston, Passaic
    County Legal Aid; Ms. Tess Canja, American Association of
    Retired Persons; Ms. Maude Hurd, ACORN.
        Testifying before the Subcommittee on June 8, 1995 were:
    Mr. Robert Elliott, President and C.E.O., Household Finance
    Corporation on behalf of the American Financial Services
    Association; Mr. Harley Bergmeyer, President, Saline State
    Bank; Mr. Wayne Holsted, Chairman and Chief Counsel, Northwest
    Title and Escrow; Mr. Eric Carlsen, Senior Vice President,
    Frontier Savings Bank; Mr. Richard Roberto, Vice President,
    European American Bank; Mr. Stanley Lowe, First Representative,
    Pittsburgh Community Reinvestment Group.

                       Committee Consideration and Votes

                          (Rule XI, Clause 2(l)(2)(B))

        On June 21, 22, 27, and 28, 1995, the Committee met in open
    session to mark up regulatory burden relief legislation. The
    Committee considered as original text for purposes of amendment
    a Committee Print which incorporated the provisions of H.R.
    1362 as reported by the Subcommittee on Financial Institutions
    and Consumer Credit and a provision placing a moratorium on the
    authority of the Comptroller of the Currency to allow new
    insurance powers for national banks.
        During the markup, the Committee approved, by recorded
    vote, 18 amendments to the Committee Print. The Committee also
    defeated, by recorded vote, 14 amendments. The following
    amendments were adopted by recorded vote.
        An amendment offered by Mrs. Roukema and Mr. Bereuter
    making a number of clarifications to Title I of the Committee
    Print. Pages 1-9 of the amendment which make a number of
    changes to the RESPA and the TILA, including the transfer of
    rulemaking authority for all disclosure aspects of the RESPA to
    the Federal Reserve Board, passed 27-11.
            YEAS                          NAYS
    Mr. Leach                           Mr. LaFalce
    Mr. McCollum                        Mr. Vento
    Mrs. Roukema                        Mrs. Maloney
    Mr. Bereuter                        Ms. Roybal-Allard
    Mr. Roth                            Mr. Barrett, (WI)
    Mr. Baker, (LA)                     Ms. Velazquez
    Mr. Lazio                           Mr. Wynn
    Mr. Bachus                          Mr. Fields, (LA)
    Mr. Castle                          Mr. Watt
    Mr. King                            Mr. Hinchey
    Mr. Royce                           Mr. Bentsen
    Mr. Weller
    Mr. Hayworth
    Mr. Metcalf
    Mr. Bono
    Mr. Ney
    Mr. Ehrlich
    Mr. Barr
    Mr. Chrysler
    Mr. Cremeans
    Mr. Fox
    Mr. Heineman
    Mr. Stockman
    Mr. LoBiondo
    Mr. Watts
    Mrs. Kelly
    Mr. Orton

        Page 10 of the amendment which requires federal bank
    regulators to ensure that their examiners consult with each
    other and to consider appointing an examiner in charge for all
    agency exams passed 38-0.
            YEAS                          NAYS
    Mr. Leach
    Mr. McCollum
    Mrs. Roukema
    Mr. Bereuter
    Mr. Roth
    Mr. Baker, (LA)
    Mr. Lazio
    Mr. Bachus
    Mr. Castle
    Mr. King
    Mr. Royce
    Mr. Weller
    Mr. Hayworth
    Mr. Metcalf
    Mr. Bono
    Mr. Ney
    Mr. Ehrlich
    Mr. Barr
    Mr. Chrysler
    Mr. Cremeans
    Mr. Fox
    Mr. Heineman
    Mr. Stockman
    Mr. LoBiondo
    Mr. Watts
    Mrs. Kelly
    Mr. LaFalce
    Mr. Vento
    Mr. Orton
    Mrs. Maloney
    Ms. Roybal-Allard
    Mr. Barrett, (WI)
    Ms. Velazquez
    Mr. Wynn
    Mr. Fields, (LA)
    Mr. Watt
    Mr. Hinchey
    Mr. Bentsen

        Pages 11-12 of the amendment which clarify the effective
    date of the amendments made to the TISA passed 39-0.
            YEAS                          NAYS
    Mr. Leach
    Mr. McCollum
    Mrs. Roukema
    Mr. Bereuter
    Mr. Roth
    Mr. Baker, (LA)
    Mr. Lazio
    Mr. Bachus
    Mr. Castle
    Mr. King
    Mr. Royce
    Mr. Weller
    Mr. Hayworth
    Mr. Metcalf
    Mr. Bono
    Mr. Ney
    Mr. Ehrlich
    Mr. Barr
    Mr. Chrysler
    Mr. Cremeans
    Mr. Fox
    Mr. Heineman
    Mr. LoBiondo
    Mr. Watts
    Mrs. Kelly
    Mr. LaFalce
    Mr. Vento
    Mr. Orton
    Mr. Sanders
    Mrs. Maloney
    Mr. Gutierrez
    Ms. Roybal-Allard
    Mr. Barrett, (WI)
    Mr. Velazquez
    Mr. Wynn
    Mr. Fields, (LA)
    Mr. Watt
    Mr. Hinchey
    Mr. Bentsen

        Page 13 of the amendment which clarifies the burden of
    proof for unauthorized transfers remain on the creditors passed
    30-10.
            YEAS                          NAYS
    Mr. Leach                           Mr. LaFalce
    Mr. McCollum                        Mr. Vento
    Mrs. Roukema                        Mr. Sanders
    Mr. Bereuter                        Mrs. Maloney
    Mr. Roth                            Mr. Gutierrez
    Mr. Baker, (LA)                     Ms. Velazquez
    Mr. Lazio                           Mr. Wynn
    Mr. Bachus                          Mr. Fields, (LA)
    Mr. King                            Mr. Watt
    Mr. Royce                           Mr. Hinchey
    Mr. Lucas
    Mr. Weller
    Mr. Hayworth
    Mr. Metcalf
    Mr. Bono
    Mr. Ney
    Mr. Ehrlich
    Mr. Barr
    Mr. Chrysler
    Mr. Cremeans
    Mr. Fox
    Mr. Heineman
    Mr. LoBiondo
    Mr. Watts
    Mrs. Kelly
    Mr. Kanjorski
    Mr. Orton
    Ms. Roybal-Allard
    Mr. Barrett, (WI)
    Mr. Bentsen

        Page 14 of the amendment which makes a number of changes
    concerning consumer leases, including the placing of statutory
    penalties for creditors under the Consumer Credit Protection
    Act passed 41-0.
            YEAS                          NAYS
    Mr. Leach
    Mr. McCollum
    Mrs. Roukema
    Mr. Bereuter
    Mr. Roth
    Mr. Baker, (LA)
    Mr. Lazio
    Mr. Bachus
    Mr. Castle
    Mr. King
    Mr. Royce
    Mr. Lucas
    Mr. Weller
    Mr. Hayworth
    Mr. Metcalf
    Mr. Bono
    Mr. Ney
    Mr. Ehrlich
    Mr. Barr
    Mr. Chrysler
    Mr. Cremeans
    Mr. Fox
    Mr. Heineman
    Mr. LoBiondo
    Mr. Watts
    Mrs. Kelly
    Mr. LaFalce
    Mr. Vento
    Mr. Kanjorski
    Mr. Orton
    Mr. Sanders
    Mrs. Maloney
    Mr. Gutierrez
    Ms. Roybal-Allard
    Mr. Barrett, (WI)
    Ms. Velazquez
    Mr. Wynn
    Mr. Fields, (LA)
    Mr. Watt
    Mr. Hinchey
    Mr. Bentsen

        An amendment offered by Mr. Roth which prevents the CRA
    regulations from requiring financial institutions from making
    loans or other agreements to an uncreditworthy person,
    business, organization, or any other entity that would
    jeopardize safety and soundness of the subject lending
    institutions was passed 25-13.
            YEAS                          NAYS
    Mr. Leach                           Mr. Ney
    Mr. McCollum                        Mr. Fox
    Mrs. Roukema                        Mr. Watts
    Mr. Bereuter                        Mr. LaFalce
    Mr. Roth                            Mr. Kennedy
    Mr. Baker, (LA)                     Mr. Mfume
    Mr. Bachus                          Ms. Waters
    Mr. King                            Mr. Sanders
    Mr. Royce                           Mr. Roybal-Allard
    Mr. Weller                          Ms. Velazquez
    Mr. Hayworth                        Mr. Wynn
    Mr. Metcalf                         Mr. Fields, (LA)
    Mr. Bono                            Mr. Hinchey
    Mr. Ehrlich
    Mr. Barr
    Mr. Cremeans
    Mr. Stockman
    Mr. LoBiondo
    Mrs. Kelly
    Mr. Vento
    Mr. Kanjorski
    Mr. Barrett, (WI)
    Mr. Watt
    Mr. Ackerman
    Mr. Bentsen
        Present: Mr. Heineman.

        An amendment offered by Mr. Weller which strikes the
    requirement that regulated financial institutions with $100
    million or less in assets be outside of a metropolitan
    statistical area in order to be exempt from CRA examination
    requirements was passed 23-16.
            YEAS                          NAYS
    Mr. Leach                           Mr. Bereuter
    Mr. McCollum                        Mr. Vento
    Mrs. Roukema                        Mr. Schumer
    Mr. Roth                            Mr. Frank
    Mr. Baker, (LA)                     Mr. Kennedy
    Mr. Bachus                          Ms. Waters
    Mr. Castle                          Mr. Sanders
    Mr. King                            Mr. Gutierrez
    Mr. Royce                           Ms. Roybal-Allard
    Mr. Weller                          Mr. Barrett, (WI)
    Mr. Hayworth                        Ms. Velazquez
    Mr. Metcalf                         Mr. Wynn
    Mr. Bono                            Mr. Fields, (LA)
    Mr. Ney                             Mr. Watt
    Mr. Ehrlich                         Mr. Hinchey
    Mr. Barr                            Mr. Bentsen
    Mr. Cremeans
    Mr. Fox
    Mr. Heineman
    Mr. Stockman
    Mr. LoBiondo
    Mr. Watts
    Mrs. Kelly

        An amendment offered by Mr. McCollum which strikes
    assessment of an institution's CRA record during the
    applications process for a deposit facility and instead
    requires the CRA record to be included in the assessment of
    overall evaluation of the condition of the institution was
    passed 25-17.
            YEAS                          NAYS
    Mr. Leach                           Mr. Vento
    Mr. McCollum                        Mr. Frank
    Mrs. Roukema                        Mr. Kanjorski
    Mr. Bereuter                        Mr. Kennedy
    Mr. Roth                            Ms. Waters
    Mr. Lazio                           Mr. Orton
    Mr. Bachus                          Mr. Sanders
    Mr. Castle                          Mrs. Maloney
    Mr. King                            Mr. Gutierrez
    Mr. Royce                           Ms. Roybal-Allard
    Mr. Lucas                           Mr. Barrett, (WI)
    Mr. Weller                          Ms. Velazquez
    Mr. Hayworth                        Mr. Wynn
    Mr. Metcalf                         Mr. Fields, (LA)
    Mr. Bono                            Mr. Watt
    Mr. Ney                             Mr. Hinchey
    Mr. Ehrlich                         Mr. Bentsen
    Mr. Barr
    Mr. Cremeans
    Mr Fox
    Mr. Heineman
    Mr. Stockman
    Mr. LoBiondo
    Mr. Watts
    Mr. Kelly

        An amendment offered by Mr. Schumer, Ms. Maloney and Mr.
    Vento which deletes the provision that modified liability
    provisions under the EFTA for the unauthorized use of
    electronic fund transfers was passed 24-18.
            YEAS                          NAYS
    Mr. Leach                           Mrs. Roukema
    Mr. Royce                           Mr. Bereuter
    Mr. Heineman                        Mr. Baker, (LA)
    Mr. Stockman                        Mr. Lazio
    Mr. Watts                           Mr. Bachus
    Mrs. Kelly                          Mr. Castle
    Mr. LaFalce                         Mr. King
    Mr. Vento                           Mr. Lucas
    Mr. Schumer                         Mr. Weller
    Mr. Frank                           Mr. Hayworth
    Mr. Kennedy                         Mr. Bono
    Mr. Flake                           Mr. Ney
    Ms. Waters                          Mr. Ehrlich
    Mr. Sanders                         Mr. Barr
    Mrs. Maloney                        Mr. Chrysler
    Ms. Roybal-Allard                   Mr. Cremeans
    Mr. Barrett, (WI)                   Mr. Fox
    Ms. Velazquez                       Mr. LoBiondo
    Mr. Wynn
    Mr. Fields, (LA)
    Mr. Watt
    Mr. Hinchey
    Mr. Ackerman
    Mr. Bentsen

        An amendment offered by Mr. Schumer and Mr. Vento which
    eliminates the provisions that modified the liability
    provisions under the TILA for the unauthorized use of credit
    cards was passed 23-21.
            YEAS                          NAYS
    Mr. Leach                           Mr. McCollum
    Mr. Royce                           Mrs. Roukema
    Mr. Heineman                        Mr. Bereuter
    Mr. Stockman                        Mr. Baker, (LA)
    Mr. Watts                           Mr. Lazio
    Mrs. Kelly                          Mr. Bachus
    Mr. LaFalce                         Mr. Castle
    Mr. Vento                           Mr. King
    Mr. Schumer                         Mr. Lucas
    Mr. Kennedy                         Mr. Weller
    Mr. Flake                           Mr. Hayworth
    Ms. Waters                          Mr. Bono
    Mr. Sanders                         Mr. Ney
    Mrs. Maloney                        Mr. Ehrlich
    Ms. Roybal-Allard                   Mr. Barr
    Mr. Barrett, (WI)                   Mr. Chrysler
    Ms. Velazquez                       Mr. Cremeans
    Mr. Wynn                            Mr. Fox
    Mr. Fields, (LA)                    Mr. LoBiondo
    Mr. Watt                            Mr. Frank
    Mr. Hinchey                         Mr. Orton
    Mr. Ackerman
    Mr. Bentsen

        An amendment to Mr. Leach's amendment which strikes a
    requirement that would have required agency concurrence in
    Department of Justice enforcement actions under the fair
    lending cases was passed 24-20.
            YEAS                          NAYS
    Mr. Bereuter                        Mr. Leach
    Mr. Ney                             Mr. McCollum
    Mr. Fox                             Mrs. Roukema
    Mr. Watts                           Mr. Baker, (LA)
    Mrs. Kelly                          Mr. Lazio
    Mr. LaFalce                         Mr. Bachus
    Mr. Vento                           Mr. King
    Mr. Frank                           Mr. Royce
    Mr. Kennedy                         Mr. Lucas
    Mr. Flake                           Mr. Weller
    Mr. Mfume                           Mr. Hayworth
    Ms. Waters                          Mr. Metcalf
    Mr. Orton                           Mr. Bono
    Mr. Sanders                         Mr. Ehrlich
    Mrs. Maloney                        Mr. Barr
    Mr. Gutierrez                       Mr. Chrysler
    Ms. Roybal-Allard                   Mr. Cremeans
    Mr. Barrett, (WI)                   Mr. Heineman
    Ms. Velazquez                       Mr. Stockman
    Mr. Wynn                            Mr. LoBiondo
    Mr. Watt
    Mr. Hinchey
    Mr. Ackerman
    Mr. Bentsen

        An amendment offered by Mr. Hinchey which requires that in
    order to receive protection under the ECOA, credit scoring
    systems cannot have a disparate impact on a protected class
    unless the criterion used is justified by business necessity
    and a no less discriminatory alternative is available was
    passed 29-17.
            YEAS                          NAYS
    Mr. Leach                           Mr. McCollum
    Mrs. Roukema                        Mr. Baker, (LA)
    Mr. Bereuter                        Mr. Lazio
    Mr. Castle                          Mr. Bachus
    Mr. Weller                          Mr. King
    Mr. Fox                             Mr. Royce
    Mr. LoBiondo                        Mr. Lucas
    Mr. Watts                           Mr. Hayworth
    Mrs. Kelly                          Mr. Metcalf
    Mr. LaFalce                         Mr. Bono
    Mr. Vento                           Mr. Ney
    Mr. Frank                           Mr. Ehrlich
    Mr. Kanjorski                       Mr. Barr
    Mr. Kennedy                         Mr. Chrysler
    Mr. Flake                           Mr. Cremeans
    Mr. Mfume                           Mr. Heineman
    Ms. Waters                          Mr. Stockman
    Mr. Orton
    Mrs. Maloney
    Mr. Gutierrez
    Ms. Roybal-Allard
    Mr. Barrett, (WI)
    Ms. Velazquez
    Mr. Wynn
    Mr. Fields, (LA)
    Mr. Watt
    Mr. Hinchey
    Mr. Ackerman
    Mr. Bentsen

        An amendment offered by Mr. Hinchey which strikes the
    prohibition in the legislation which would have restricted the
    use of disparate impact evidence in enforcing fair lending laws
    was passed 32-15.
            YEAS                          NAYS
    Mr. Leach                           Mr. McCollum
    Mrs. Roukema                        Mr. Baker, (LA)
    Mr. Bereuter                        Mr. Bachus
    Mr. Lazio                           Mr. King
    Mr. Castle                          Mr. Royce
    Mr. Metcalf                         Mr. Lucas
    Mr. Fox                             Mr. Weller
    Mr. Heineman                        Mr. Hayworth
    Mr. LoBiondo                        Mr. Bono
    Mr. Watts                           Mr. Ney
    Mrs. Kelly                          Mr. Ehrlich
    Mr. LaFalce                         Mr. Barr
    Mr. Vento                           Mr. Chrysler
    Mr. Frank                           Mr. Cremeans
    Mr. Kanjorski                       Mr. Stockman
    Mr. Kennedy
    Mr. Flake
    Mr. Mfume
    Ms. Waters
    Mr. Orton
    Mr. Sanders
    Mrs. Maloney
    Mr. Gutierrez
    Ms. Roybal-Allard
    Mr. Barrett, (WI)
    Ms. Velazquez
    Mr. Wynn
    Mr. Fields, (LA)
    Mr. Watt
    Mr. Hinchey
    Mr. Ackerman
    Mr. Bentsen

        An amendment offered by Mr. Castle which makes
    clarifications to the OCC insurance moratorium language
    contained in Mr. Leach's amendment was passed 40-2.
            YEAS                          NAYS
    Mr. Leach                           Mr. McCollum
    Mrs. Roukema                        Mr. Kanjorski
    Mr. Bereuter
    Mr. Roth
    Mr. Baker, (LA)
    Mr. Lazio
    Mr. Bachus
    Mr. Castle
    Mr. King
    Mr. Royce
    Mr. Lucas
    Mr. Hayworth
    Mr. metcalf
    Mr. Bono
    Mr. Ehrlich
    Mr. Barr
    Mr. Chrysler
    Mr. Cremeans
    Mr. Fox
    Mr. Heineman
    Mr. Stockman
    Mr. LoBiondo
    Mr. Watts
    Mrs. Kelly
    Mr. Gonzalez
    Mr. LaFalce
    Mr. Vento
    Mr. Schumer
    Mr. Frank
    Mr. Kennedy
    Mr. Mfume
    Ms. Waters
    Mrs. Maloney
    Mr. Gutierrez
    Ms. Roybal-Allard
    Mr. Barrett, (WI)
    Ms. Velazquez
    Mr. Wynn
    Mr. Watt
    Mr. Bentsen

        An amendment offered by Mr. Baker, (LA), which amends
    section (4)(c)(8) of the BHCA to allow bank holding companies
    to own insurance companies in accordance with state insurance
    laws was passed 36-12.
            YEAS                          NAYS
    Mrs. Roukema                        Mr. Leach
    Mr. Roth                            Mr. McCollum
    Mr. Baker, (LA)                     Mr. Bereuter
    Mr. Lazio                           Mr. Weller
    Mr. Bachus                          Mr. Hayworth
    Mr. Castle                          Mr. Metcalf
    Mr. King                            Mr. Ney
    Mr. Royce                           Mr. Ehrlich
    Mr. Lucas                           Mr. LoBiondo
    Mr. Bono                            Mrs. Kelly
    Mr. Barr                            Ms. Waters
    Mr. Chrysler                        Mr. Sanders
    Mr. Cremeans
    Mr. Fox
    Mr. Heineman
    Mr. Stockman
    Mr. Watts
    Mr. Gonzalez
    Mr. LaFalce
    Mr. Vento
    Mr. Schumer
    Mr. Frank
    Mr. Kanjorski
    Mr. Kennedy
    Mr. Flake
    Mr. Mfume
    Mr. Orton
    Mrs. Maloney
    Mr. Gutierrez
    Ms. Roybal-Allard
    Mr. Barrett, (WI)
    Ms. Velazquez
    Mr. Wynn
    Mr. Watt
    Mr. Hinchey
    Mr. Bentsen

        An amendment offered by Mr. McCollum which strikes the
    provision putting restrictions on the ability of outside
    counsel and accountants to serve on a financial institution's
    board of directors was passed 27-17.
            YEAS                          NAYS
    Mr. Leach                           Mr. Gonzalez
    Mr. McCollum                        Mr. LaFalce
    Mrs. Roukema                        Mr. Vento
    Mr. Bereuter                        Mr. Schumer
    Mr. Baker, (LA)                     Mr. Kanjorski
    Mr. Lazio                           Mr. Kennedy
    Mr. Bachus                          Mr. Flake
    Mr. Castle                          Mr. Mfume
    Mr. King                            Ms. Waters
    Mr. Royce                           Mr. Orton
    Mr. Lucas                           Mrs. Maloney
    Mr. Weller                          Mr. Gutierrez
    Mr. Hayworth                        Ms. Roybal-Allard
    Mr. Metcalf                         Mr. Barrett, (WI)
    Mr. Bono                            Ms. Velazquez
    Mr. Ney                             Mr. Hinchey
    Mr. Ehrlich                         Mr. Bentsen
    Mr. Barr
    Mr. Chrysler
    Mr. Cremeans
    Mr. Fox
    Mr. Heineman
    Mr. LoBiondo
    Mr. Watts
    Mrs. Kelly
    Mr. Wynn
    Mr. Watt

        The following amendments were defeated by recorded vote.
        An amendment offered by Mr. Barrett, (WI), to Mr. Roth's
    amendment which strikes reference to uncreditworthy persons was
    defeated 16-25.
            YEAS                          NAYS
    Mr. LaFalce                         Mr. Leach
    Mr. Vento                           Mr. McCollum
    Mr. Kanjorski                       Mrs. Roukema
    Mr. Kennedy                         Mr. Bereuter
    Mr. Mfume                           Mr. Roth
    Ms. Waters                          Mr. Baker, (LA)
    Mr. Sanders                         Mr. Lazio
    Ms. Roybal-Allard                   Mr. Bachus
    Mr. Barrett, (WI)                   Mr. Castle
    Ms. Velazquez                       Mr. Royce
    Mr. Wynn                            Mr. Lucas
    Mr. Fields, (LA)                    Mr. Weller
    Mr. Watt                            Mr. Hayworth
    Mr. Hinchey                         Mr. Metcalf
    Mr. Ackerman                        Mr. Bono
    Mr. Bentsen                         Mr. Ney
                                        Mr. Ehrlich
                                        Mr. Barr
                                        Mr. Cremeans
                                        Mr. Fox
                                        Mr. Heineman
                                        Mr. Stockman
                                        Mr. LoBiondo
                                        Mr. Watts
                                        Mrs. Kelly

        An amendment offered by Mr. Kennedy which strikes the CRA
    subtitle was defeated 18-26.
            YEAS                          NAYS
    Mr. Gonzalez                        Mr. Leach
    Mr. Vento                           Mr. McCollum
    Mr. Frank                           Mrs. Roukema
    Mr. Kanjorski                       Mr. Bereuter
    Mr. Kennedy                         Mr. Roth
    Mr. Flake                           Mr. Lazio
    Ms. Waters                          Mr. Bachus
    Mr. Sanders                         Mr. Castle
    Mrs. Maloney                        Mr. King
    Mr. Gutierrez                       Mr. Royce
    Ms. Roybal-Allard                   Mr. Lucas
    Mr. Barrett, (WI)                   Mr. Weller
    Ms. Velazquez                       Mr. Hayworth
    Mr. Wynn                            Mr. Metcalf
    Mr. Fields, (LA)                    Mr. Bono
    Mr. Watt                            Mr. Ehrlich
    Mr. Hinchey                         Mr. Barr
    Mr. Bentsen                         Mr. Chrysler
                                        Mr. Cremeans
                                        Mr. Fox
                                        Mr. Heineman
                                        Mr. Stockman
                                        Mr. LoBiondo
                                        Mr. Watts
                                        Mrs. Kelly
                                        Mr. Orton

        An amendment offered by Mr. McCollum which raises the level
    of CRA self-certification from $25,000,000 to $1,000,000,000
    was defeated 11-32.
            YEAS                          NAYS
    Mr. McCollum                        Mr. Leach
    Mr. Roth                            Mrs. Roukema
    Mr. Baker, (LA)                     Mr. Bereuter
    Mr. Bachus                          Mr. Lazio
    Mr. King                            Mr. Castle
    Mr. Royce                           Mr. Hayworth
    Mr. Weller                          Mr. Metcalf
    Mr. Bono                            Mr. Ney
    Mr. Ehrlich                         Mr. Cremeans
    Mr. Barr                            Mr. Heineman
    Mr. Fox                             Mr. LoBiondo
                                        Mr. Watts
                                        Mrs. Kelly
                                        Mr. Vento
                                        Mr. Schumer
                                        Mr. Frank
                                        Mr. Kanjorski
                                        Mr. Kennedy
                                        Mr. Flake
                                        Mr. Mfume
                                        Ms. Waters
                                        Mr. Orton
                                        Mr. Sanders
                                        Mr. Gutierrez
                                        Ms. Roybal-Allard
                                        Mr. Barrett, (WI)
                                        Ms. Velazquez
                                        Mr. Wynn
                                        Mr. Fields, (LA)
                                        Mr. Watt
                                        Mr. Hinchey
                                        Mr. Bensten

        An amendment offered by Mr. McCollum which amends the CRA
    to bring it back to its original purpose by making redlining
    enforceable under the ECOA and the FHA was defeated 11-26.
            YEAS                          NAYS
    Mr. McCollum                        Mr. Leach
    Mr. Roth                            Mrs. Roukema
    Mr. Bachus                          Mr. Bereuter
    Mr. King                            Mr. Lazio
    Mr. Royce                           Mr. Castle
    Mr. Lucas                           Mr. Metcalf
    Mr. Hayworth                        Mr. Ney
    Mr. Bono                            Mr. Cremeans
    Mr. Ehrlich                         Mr. Fox
    Mr. Barr                            Mr. Heineman
    Mr. Chrysler                        Mr. LoBiondo
                                        Mr. Watts
                                        Mr. Vento
                                        Mr. Frank
                                        Mr. Kanjorski
                                        Mr. Kennedy
                                        Mr. Waters
                                        Mr. Orton
                                        Ms. Roybal-Allard
                                        Mr. Barrett, (WI)
                                        Ms. Velazquez
                                        Mr. Wynn
                                        Mr. Fields, (LA)
                                        Mr. Watt
                                        Mr. Hinchey
                                        Mr. Bensten

        An amendment offered by Mr. Fields, (LA), which provides
    for ``point of transaction'' fee disclosures for all automated
    teller machine transactions was passed by a Voice Vote. A
    motion to reconsider the amendment was approved 18-17.
            YEAS                          NAYS
    Mr. Leach                           Mr. Bachus
    Mr. Bereuter                        Mr. Chrysler
    Mr. Roth                            Mr. LaFalce
    Mr. Lazio                           Mr. Vento
    Mr. Castle                          Mr. Schumer
    Mr. King                            Mr. Frank
    Mr. Royce                           Ms. Waters
    Mr. Lucas                           Mr. Orton
    Mr. Weller                          Mrs. Maloney
    Mr. Hayworth                        Ms. Roybal-Allard
    Mr. Metcalf                         Mr. Barrett, (WI)
    Mr. Bono                            Ms. Velazquez
    Mr. Ehrlich                         Mr. Wynn
    Mr. Cremeans                        Mr. Fields, (LA)
    Mr. Heineman                        Mr. Watt
    Mr. Stockman                        Mr. Hinchey
    Mr. LoBiondo                        Mr. Ackerman
    Mrs. Kelly

        Mr. Fields' amendment was then defeated by a roll call vote
    of 21-21.
            YEAS                          NAYS
    Mr. Bachus                          Mr. Leach
    Mr. Stockman                        Mrs. Roukema
    Mr. LaFalce                         Mr. Bereuter
    Mr. Vento                           Mr. Roth
    Mr. Schumer                         Mr. Lazio
    Mr. Frank                           Mr. Castle
    Mr. Kanjorski                       Mr. King
    Mr. Kennedy                         Mr. Royce
    Ms. Waters                          Mr. Lucas
    Mr. Orton                           Mr. Weller
    Mr. Sanders                         Mr. Hayworth
    Mrs. Maloney                        Mr. Metcalf
    Ms. Roybal-Allard                   Mr. Bono
    Mr. Barrett, (WI)                   Mr. Ney
    Ms. Velazquez                       Mr. Ehrlich
    Mr. Wynn                            Mr. Barr
    Mr. Fields, (LA)                    Mr. Chrysler
    Mr. Watt                            Mr. Cremeans
    Mr. Hinchey                         Mr. Heineman
    Mr. Ackerman                        Mr. LoBiondo
    Mr. Bentsen                         Mrs. Kelly

        An amendment offered by Mr. Kennedy which strikes the
    affiliate information sharing provision of the legislation was
    defeated 19-23.
            YEAS                          NAYS
    Mr. Gonzalez                        Mr. Leach
    Mr. LaFalce                         Mr. McCollum
    Mr. Vento                           Mrs. Roukema
    Mr. Schumer                         Mr. Bereuter
    Mr. Frank                           Mr. Bachus
    Mr. Kennedy                         Mr. Castle
    Mr. Flake                           Mr. King
    Ms. Waters                          Mr. Royce
    Mr. Sanders                         Mr. Lucas
    Mrs. Maloney                        Mr. Weller
    Mr. Gutierrez                       Mr. Hayworth
    Ms. Roybal-Allard                   Mr. Bono
    Mr. Barrett, (WI)                   Mr. Ney
    Ms. Velazquez                       Mr. Ehrlich
    Mr. Wynn                            Mr. Barr
    Mr. Watt                            Mr. Chrysler
    Mr. Hinchey                         Mr. Cremeans
    Mr. Ackerman                        Mr. Fox
    Mr. Bentsen                         Mr. Heineman
                                        Mr. LoBiondo
                                        Mr. Watts
                                        Mrs. Kelly
                                        Mr. Orton

        An amendment offered by Ms. Waters which imposes a two-year
    moratorium on bank fee increases for accounts with an average
    daily balance below $3,000 was defeated 4-30.
            YEAS                          NAYS
    Ms. Waters                          Mr. Leach
    Mr. Sanders                         Mr. McCollum
    Mr. Gutierrez                       Mrs. Roukema
    Ms. Roybal-Allard                   Mr. Bereuter
                                        Mr. Baker, (LA)
                                        Mr. Lazio
                                        Mr. Bachus
                                        Mr. Castle
                                        Mr. King
                                        Mr. Royce
                                        Mr. Weller
                                        Mr. Hayworth
                                        Mr. Metcalf
                                        Mr. Bono
                                        Mr. Ney
                                        Mr. Ehrlich
                                        Mr. Barr
                                        Mr. Fox
                                        Mr. Heineman
                                        Mr. Stockman
                                        Mr. LoBiondo
                                        Mr. Watts
                                        Mrs. Kelly
                                        Mr. Frank
                                        Mr. Orton
                                        Mr. Barrett, (WI)
                                        Mr. Wynn
                                        Mr. Watt
                                        Mr. Hinchey
                                        Mr. Ackerman

        An amendment offered by Mr. Bentsen which changes the CRA
    rating system was defeated 15-22.
            YEAS                          NAYS
    Mr. Vento                           Mr. Leach
    Mr. Frank                           Mr. McCollum
    Mr. Kanjorski                       Mrs. Roukema
    Mr. Kennedy                         Mr. Bereuter
    Ms. Waters                          Mr. Lazio
    Mr. Orton                           Mr. Bachus
    Mr. Sanders                         Mr. Castle
    Ms. Roybal-Allard                   Mr. King
    Mr. Barrett, (WI)                   Mr. Royce
    Ms. Velazquez                       Mr. Lucas
    Mr. Wynn                            Mr. Hayworth
    Mr. Fields, (LA)                    Mr. Metcalf
    Mr. Watt                            Mr. Bono
    Mr. Hinchey                         Mr. Ehrlich
    Mr. Bentsen                         Mr. Barr
                                        Mr. Cremeans
                                        Mr. Fox
                                        Mr. Heineman
                                        Mr. Stockman
                                        Mr. LoBiondo
                                        Mr. Watts
                                        Mrs. Kelly

        An amendment offered by Mr. Schumer and Mrs. Maloney which
    deletes provisions in the legislation modifying the current
    restrictions on insider lending was defeated 15-26.
            YEAS                          NAYS
    Mr. LaFalce                         Mr. Leach
    Mr. Vento                           Mr. McCollum
    Mr. Schumer                         Mrs. Roukema
    Mr. Flake                           Mr. Bereuter
    Mr. Mfume                           Mr. Baker, (LA)
    Mr. Orton                           Mr. Lazio
    Mr. Sanders                         Mr. Bachus
    Mrs. Maloney                        Mr. Castle
    Ms. Roybal-Allard                   Mr. King
    Mr. Barrett, (WI)                   Mr. Royce
    Ms. Velazquez                       Mr. Lucas
    Mr. Wynn                            Mr. Weller
    Mr. Watt                            Mr. Hayworth
    Mr. Hinchey                         Mr. Metcalf
    Mr. Bentsen                         Mr. Bono
                                        Mr. Ney
                                        Mr. Ehrlich
                                        Mr. Barr
                                        Mr. Chrysler
                                        Mr. Cremeans
                                        Mr. Fox
                                        Mr. Heineman
                                        Mr. Stockman
                                        Mr. LoBiondo
                                        Mr. Watts
                                        Mrs. Kelly

        An amendment offered by Mr. Schumer and Mrs. Maloney which
    deletes the provision in the legislation modifying the current
    statutory requirement that all members of bank audit committees
    be independent directors was defeated 20-20.
            YEAS                          NAYS
    Mr. Leach                           Mr. McCollum
    Mr. Lazio                           Mrs. Roukema
    Mr. Castle                          Mr. Bereuter
    Mr. Royce                           Mr. Roth
    Mr. Metcalf                         Mr. Baker, (LA)
    Mr. Heineman                        Mr. Bachus
    Mrs. Kelly                          Mr. King
    Mr. LaFalce                         Mr. Lucas
    Mr. Vento                           Mr. Weller
    Mr. Schumer                         Mr. Hayworth
    Mr. Mfume                           Mr. Bono
    Mr. Orton                           Mr. Ney
    Mrs. Maloney                        Mr. Ehrlich
    Mr. Gutierrez                       Mr. Barr
    Ms. Roybal-Allard                   Mr. Chrysler
    Mr. Barrett, (WI)                   Mr. Cremeans
    Ms. Velazquez                       Mr. Fox
    Mr. Wynn                            Mr. Stockman
    Mr. Watt                            Mr. LoBiondo
    Mr. Bentsen                         Mr. Watts

        An amendment offered by Mr. Vento which strikes section 234
    of the legislation modifying the culpability standards for
    outside directors was defeated 17-24.
            YEAS                          NAYS
    Mr. Leach                           Mr. McCollum
    Mrs. Roukema                        Mr. Bereuter
    Mr. Gonzalez                        Mr. Roth
    Mr. LaFalce                         Mr. Baker, (LA)
    Mr. Vento                           Mr. Lazio
    Mr. Frank                           Mr. Bachus
    Mr. Kanjorski                       Mr. Castle
    Mr. Kennedy                         Mr. King
    Mr. Flake                           Mr. Royce
    Mr. Orton                           Mr. Lucas
    Mrs. Maloney                        Mr. Weller
    Ms. Roybal-Allard                   Mr. Hayworth
    Mr. Barrett, (WI)                   Mr. Bono
    Ms. Velazquez                       Mr. Ney
    Mr. Watt                            Mr. Ehrlich
    Mr. Hinchey                         Mr. Barr
    Mr. Bentsen                         Mr. Chrysler
                                        Mr. Cremeans
                                        Mr. Fox
                                        Mr. Heineman
                                        Mr. Stockman
                                        Mr. LoBiondo
                                        Mr. Watts
                                        Mrs. Kelly

        An amendment offered by Mr. Kennedy which strikes section
    238 concerning second mortgages was defeated by 21-23.
            YEAS                          NAYS
    Mr. Leach                           Mr. McCollum
    Mr. Lazio                           Mrs. Roukema
    Mr. Metcalf                         Mr. Bereuter
    Mr. Heineman                        Mr. Roth
    Mr. LoBiondo                        Mr. Baker, (LA)
    Mr. Gonzalez                        Mr. Bachus
    Mr. LaFalce                         Mr. Castle
    Mr. Vento                           Mr. King
    Mr. Frank                           Mr. Royce
    Mr. Kennedy                         Mr. Lucas
    Mr. Flake                           Mr. Weller
    Ms. Waters                          Mr. Hayworth
    Mr. Sanders                         Mr. Bono
    Mr. Gutierrez                       Mr. Ney
    Ms. Roybal-Allard                   Mr. Ehrlich
    Mr. Barrett, (WI)                   Mr. Barr
    Ms. Velazquez                       Mr. Chrysler
    Mr. Wynn                            Mr. Cremeans
    Mr. Watt                            Mr. Fox
    Mr. Ackerman                        Mr. Stockman
    Mr. Bentsen                         Mr. Watts
                                        Mrs. Kelly
                                        Mr. Orton

        An amendment offered by Mr. Bachus which makes a number of
    reforms to the FDCPA was defeated 19-26.
            YEAS                          NAYS
    Mr. Bereuter                        Mr. McCollum
    Mr. Roth                            Mrs. Roukema
    Mr. Baker, (LA)                     Mr. Royce
    Mr. Lazio                           Mr. Fox
    Mr. Bachus                          Mr. LoBiondo
    Mr. Castle                          Mr. Watts
    Mr. King                            Mrs. Kelly
    Mr. Lucas                           Mr. Gonzalez
    Mr. Weller                          Mr. LaFalce
    Mr. Hayworth                        Mr. Vento
    Mr. Metcalf                         Mr. Schumer
    Mr. Bono                            Mr. Frank
    Mr. Ney                             Mr. Kennedy
    Mr. Ehrlich                         Mr. Mfume
    Mr. Barr                            Ms. Waters
    Mr. Chrysler                        Mr. Orton
    Mr. Cremeans                        Mr. Sanders
    Mr. Heineman                        Mrs. Maloney
    Mr. Stockman                        Mr. Gutierrez
                                        Ms. Roybal-Allard
                                        Mr. Barrett, (WI)
                                        Ms. Velazquez
                                        Mr. Wynn
                                        Mr. Watt
                                        Mr. Hinchey
                                        Mr. Bentsen

        Present: Mr. Leach.
        An amendment offered by Mr. Vento which was an amendment in
    the nature of a substitute was defeated 13-24.
            YEAS                          NAYS
    Mr. LaFalce                         Mr. Leach
    Mr. Vento                           Mr. McCollum
    Mr. Frank                           Mrs. Roukema
    Mr. Kennedy                         Mr. Bereuter
    Mr. Flake                           Mr. Roth
    Mr. Mfume                           Mr. Baker, (LA)
    Ms. Waters                          Mr. Bachus
    Mr. Sanders                         Mr. King
    Mr. Gutierrez                       Mr. Royce
    Mr. Barrett, (WI)                   Mr. Lucas
    Mr. Watt                            Mr. Weller
    Mr. Ackerman                        Mr. Hayworth
    Mr. Bentsen                         Mr. Metcalf
                                        Mr. Bono
                                        Mr. Ney
                                        Mr. Ehrlich
                                        Mr. Barr
                                        Mr. Chrysler
                                        Mr. Cremeans
                                        Mr. Fox
                                        Mr. Heineman
                                        Mr. LoBiondo
                                        Mr. Watts
                                        Mrs. Kelly

        After adopting the Committee Print, as amended, H.R. 1858
    was called up for committee consideration. A motion to strike
    everything after the enacting clause in H.R. 1858 and insert in
    lieu thereof the Committee Print, as amended, was approved by
    Voice Vote.
        A motion to adopt H.R. 1858 and favorably report H.R. 1858,
    as amended, to the House was approved 27-23.
            YEAS                          NAYS
    Mr. Leach                           Mr. Gonzalez
    Mr. McCollum                        Mr. LaFalce
    Mrs. Roukema                        Mr. Vento
    Mr. Bereuter                        Mr. Schumer
    Mr. Roth                            Mr. Frank
    Mr. Baker, (LA)                     Mr. Kanjorski
    Mr. Lazio                           Mr. Kennedy
    Mr. Bachus                          Mr. Flake
    Mr. Castle                          Mr. Mfume
    Mr. King                            Ms. Waters
    Mr. Royce                           Mr. Orton
    Mr. Lucas                           Mr. Sanders
    Mr. Weller                          Mrs. Maloney
    Mr. Hayworth                        Mr. Gutierrez
    Mr. Metcalf                         Ms. Roybal-Allard
    Mr. Bono                            Mr. Barrett, (WI)
    Mr. Ney                             Ms. Velazquez
    Mr. Ehrlich                         Mr. Wynn
    Mr. Barr                            Mr. Fields, (LA)
    Mr. Chrysler                        Mr. Watt
    Mr. Cremeans                        Mr. Hinchey
    Mr. Fox                             Mr. Ackerman
    Mr. Heineman                        Mr. Bentsen
    Mr. Stockman
    Mr. LoBiondo
    Mr. Watts
    Mrs. Kelly

        A motion to give power to the Chair to request to go to
    conference was approved 28-20.
            YEAS                          NAYS
    Mr. Leach                           Mr. Gonzalez
    Mr. McCollum                        Mr. Vento
    Mrs. Roukema                        Mr. Kanjorski
    Mr. Bereuter                        Mr. Kennedy
    Mr. Roth                            Mr. Flake
    Mr. Baker, (LA)                     Mr. Mfume
    Mr. Lazio                           Ms. Waters
    Mr. Bachus                          Mr. Orton
    Mr. Castle                          Mr. Sanders
    Mr. King                            Mrs. Maloney
    Mr. Royce                           Mr. Gutierrez
    Mr. Lucas                           Ms. Roybal-Allard
    Mr. Weller                          Mr. Barrett, (WI)
    Mr. Hayworth                        Ms. Velazquez
    Mr. Metcalf                         Mr. Wynn
    Mr. Bono                            Mr. Fields, (LA)
    Mr. Ney                             Mr. Watt
    Mr. Ehrlich                         Mr. Hinchey
    Mr. Barr                            Mr. Ackerman
    Mr. Chrysler                        Mr. Bentsen
    Mr. Cremeans                        Mr. Fox
    Mr. Heineman
    Mr. Stockman
    Mr. LoBiondo
    Mr. Watts
    Mrs. Kelly
    Mr. LaFalce

                          Committee Oversight Findings

        In compliance with clause 2(l)(3)(A) of rule XI of the
    Rules of the House of Representatives, the Committee reports
    that the findings and recommendations of the Committee, based
    on oversight activities under clause 2(b)(1) of Rule X of the
    Rules of the House of Representatives, are incorporated in the
    descriptive portions of this report.

             Committee on Government Reform and Oversight Findings

        No findings and recommendations of the Committee on
    Government Reform and Oversight were received as referred to in
    clause 2(l)(3)(D) of rule XI and clause 4(c)(2) of rule X of
    the Rules of the House of Representatives.

                   New Budget Authority and Tax Expenditures

        Clause 2(l)(3)(B) of rule XI of the Rules of the House of
    Representatives is inapplicable because this legislation does
    not provide new budgetary authority or increased tax
    expenditures.

                   Congressional Budget Office Cost Estimate

        The cost estimate pursuant to Clause 2(l)(3)(C) of rule XI,
    of the Rules of the House of Representatives and Section 403 of
    the Congressional Budget Act of 1974 has been requested, but
    had not been prepared as of the filing of Part I of this
    report. The estimate will be filed at a future date.

                          Advisory Committee Statement

        No advisory committees within the meaning of section 5(b)
    of the Federal Advisory Committee Act were created by this
    legislation.

                        Congressional Accountability Act

        The reporting requirement under section 102(b)(3) of the
    Congressional Accountability Act (P.L. 104-1) is inapplicable
    because this legislation does not relate to terms and
    conditions of employment or access to public services or
    accommodations.

                         Inflationary Impact Statement

        Pursuant to clause 2(l)(4) of rule XI of the Rules of the
    House of Representatives, the Committee estimates that H.R.
    1858 will have no significant inflationary impact on prices and
    costs in the national economy.

                          Section-by-Section Analysis

                TITLE I--REDUCTION IN GOVERNMENT OVERREGULATION

                     Subtitle A--The Home Mortgage Process

    section 101. regulatory authority over disclosures and escrow accounts
                under respa transferred to federal reserve board

        Section 101 transfers rulemaking authority for all
    disclosure provisions of the RESPA from HUD to the Federal
    Reserve Board but maintains at HUD rulemaking authority
    regarding certain real estate settlement services under the
    RESPA including those prohibiting kickbacks and unearned fees.
    This section also clarifies that the purpose of RESPA is to
    effect changes in the residential real estate settlement
    process that will result in the elimination of kickbacks or
    referral fees without directly regulating settlement service
    prices or wages paid to bona fide employees that are not
    designed as a subterfuge to facilitate kickbacks among
    affiliated companies. Section 101 also revises the rulemaking
    process under the RESPA to incorporate negotiated rulemaking
    procedures. The section distributes administrative enforcement
    of Section 8 and 9 of RESPA among HUD (for non-financial
    institutions) and the appropriate federal financial institution
    regulators (for financial entities); enforcement authority for
    disclosure requirements is shared among the Federal Reserve
    Board and the Federal depository institution regulators.
        In addition, the section requires interagency cooperation
    in establishing uniform penalties and enforcement guidelines.
    The Federal Reserve Board is given the authority to determine
    the appropriate regulator in cases of more than one potential
    regulator. The Director of the Office of Thrift Supervision
    (OTS) is given this same authority for savings and loan holding
    companies. In cases of joint ventures between a non-banking
    entity and a banking entity, the section provides that the
    banking entity's regulator will be the regulator of the joint
    venture. The section provides that liability for criminal
    penalties under the RESPA exists only for wilful violations
    (current law allows criminal penalties for unintentional
    violations). The section redesignates ``Controlled Business
    Arrangements'' as ``Affiliated Business Arrangements.''

      section 102. simplification and unification of disclosures required
                 under respa and tila for mortgage transactions

        Section 102 directs the Federal Reserve Board to eliminate
    duplicative disclosure requirements that require unnecessary,
    confusing and costly paperwork which obscures important
    consumer information. This section requires the Federal Reserve
    Board to take swift action in this area to (1) simplify
    disclosures provided under RESPA and TILA, including the timing
    of the disclosures, and (2) provide a single format for RESPA
    and TILA disclosures. In the event it is necessary to adopt
    regulations to implement the provisions of this section, the
    Board is required to publish such proposed regulations within
    three months of the date of enactment of this legislation.

       section 103. increased regulatory flexibility under the truth in
                                  lending act

        Section 103 (a) and (b) grants the Board statutory
    authority to exempt various transactions from coverage under
    TILA. The Board is directed to exempt from the TILA any class
    of transaction for which coverage under the TILA does not
    provide a measurable benefit to consumers in the form of useful
    information or protection. The Board is encouraged to exercise
    its discretionary authority granted under Sections 102 and 103
    of H.R. 1858 to reduce the regulatory burdens and costs
    associated with the credit-granting process.
        section 104. reductions in respa regulatory burdens; clarifying
                                   amendments

        Section 104 amends the RESPA to require disclosure at the
    time of application for a loan whether servicing of the loan
    may be assigned, sold or transferred. It also eliminates
    subordinate mortgages from RESPA coverage and clarifies that
    business loans are exempt from the RESPA.

             section 105. disclosures for adjustable rate mortgages

        Section 105 provides financial institutions with options
    for disclosing information regarding the impact of changes in
    interest payments under adjustable rate mortgages.
        Section 105 also adds a new paragraph to section 128(b) of
    the TILA concerning the honoring of lock-in promises.

                          section 106. certain charges

        This section clarifies whether certain fees should be
    included or excluded in the calculation of the finance charge
    under the TILA.
        (a) Third Party Fees.--This section provides that fees
    imposed by the closing agent should be excluded from the
    finance charge when the creditor does not expressly require
    their imposition or the services provided and the creditor does
    not retain the charges. Settlement agents frequently incur
    costs that they pass on to consumers without the creditor's
    knowledge or retention of the specific charge; one common
    example is courier fees. Creditors exercise little, if any,
    control over settlement agents' charges.
        (b) Mortgage Broker Fees.--This section, which applies to
    transactions entered into after the date of enactment,
    clarifies that borrower-paid mortgage broker fees will be
    included in the finance charge. This bright line rule
    eliminates a review of such factors as whether a borrower may
    or may not obtain more favorable loan terms or more timely loan
    funding using a broker rather than applying directly to the
    creditor for a loan. Lender-paid broker fees are not included
    in the finance charge because they are not paid by the
    borrower; only those charges which the borrower actually pays
    are included in the finance charge.
        (c) Debt Cancellation.--Section 106(c) currently pertains
    to the treatment of certain installment sale contracts or
    leases under the TILA. Under subsection 106(c) of this
    legislation, charges or premiums for such contracts must be
    included in the finance charge unless the creditor makes a
    clear and specific written statement to the borrower that sets
    forth the cost of the contract and states that the borrower may
    choose the person from whom he or she obtains coverage. This
    treatment applies to contracts involving insurance or any
    voluntary insurance product in connection with any consumer
    credit transaction that provides protections against loss of or
    damage to property or against part or all of the debtor's
    liability for amounts in excess of the value of the collateral
    securing the debtor's obligation, or against liability arising
    out of the ownership or use of the property.
        (d) Taxes on Security Instruments or evidences of
    Indebtedness.--Section 106(d) of the TILA currently allows
    creditors to exclude from the finance charge fees imposed by
    law for perfecting security interests related to the credit
    transaction, such as filing fees for recording the security
    instrument. Some states impose taxes on the indebtedness or on
    the documents evidencing the indebtedness or granting the
    security interest, commonly referred to as intangible taxes.
    This legislation provides that intangible taxes may be excluded
    from the finance charge when the tax must be paid before the
    creditor can perfect its security interest.
        (e) Preparation of Loan Documents.--Section 106(e) of the
    TILA currently excludes from the finance charge specific items
    that are regularly incurred when credit is secured by an
    interest in real property, such as appraisal fees, title
    examinations and document preparation. The Official Staff
    Commentary to Regulation Z explains that a lump sum charged for
    conducting or attending a closing ``is excluded from the
    finance charge if the charge is primarily for services related
    to'' the items excluded by section 106(e). This legislation
    clarifies that a closing fee that may also cover the incidental
    services performed at the closing is not a finance charge.
        (f) Fees Relating to Pest Infestations, Inspections, and
    Hazards.--Currently, section 106(e) of the TILA excludes
    appraisal fees incurred in connection with a real estate
    mortgage transaction from the finance charge. Appraisal-related
    fees, for such items as termite reports, building inspections
    or flood hazard assessments, are also incurred in evaluating
    potential risks to the value of the real property securing the
    transaction both before and after extending credit. The same
    reasoning that excludes appraisal fees from the finance charge
    when the credit is secured by real estate should apply to these
    fees. This legislation clarifies that fees for appraisal-type
    services should be excludable from the finance charge, both
    when the service is originally provided prior to settlement and
    for subsequent maintenance or verification services after
    settlement.
        (g) Ensuring Finance Charges Reflect Cost of Credit.--
    Section 106(f) of this legislation directs the Federal Reserve
    Board to reexamine the costs that consumers incur in connection
    with an extension of credit and to determine how to calculate
    the finance charge to reflect more accurately these costs. The
    definition of finance charge does not currently have a unified
    approach to fees. The current list of excludable and excluded
    fees prevents the consumer from knowing the total cost of the
    credit while the discretion give to creditors on the treatment
    of some charges results in non-uniform disclosures.
        The existing exemption from rescission for same creditor
    refinancings reportedly has enabled creditors to ``flip
    loans,'' potentially charging consumers higher rates on
    refinancings while eliminating their rights of rescission. The
    Federal Reserve Board is directed to study this practice to
    determine how creditors abuse the system the scope of such
    abusive practices, and whether ``flipping'' can be prevented.
        The Federal Reserve Board is specifically directed to work
    with representatives of affected industries and consumer groups
    (including working with those outside of the Consumer Advisory
    Council) with respect to both issues in preparing its report to
    Congress. The Federal Reserve Board is to report to Congress on
    regulatory or legislative recommendations for resolving both
    issues. To the extent regulatory changes need to be made, the
    Federal Reserve Board is authorized and directed to promulgate
    final regulations within one year of the date of enactment of
    this legislation.

                    section 107. exemptions from rescission

        Section 125(a) of TILA provides consumers with the right to
    rescind credit transactions secured by their homes within three
    days after consummation, receipt of the required disclosures,
    and the notice of the right to rescind. This provision gives
    consumers a ``cooling off'' period in which to reconsider
    offering their homes to secure the credit transaction. It was
    enacted in response to the abusive practices of certain home-
    improvement contractors who showed up at consumers' doorsteps
    and pressured them into purchasing home improvements on credit,
    secured by the house.
        The right of rescission has never applied to transactions
    to finance the acquisition or construction of homes. 15 U.S.C.
    Sec. 1635(e)(1). Similarly, section 125(e)(2) currently exempts
    from rescission the refinancing or consolidating of existing
    home-secured debt with the same creditor when there are no new
    advances.
        The amendment extends the exemption from rescission for
    same creditor ``no-cash-out'' refinancings to all refinancings
    of debt initially incurred to finance the acquisition or
    construction of consumers' homes that are secured by a first
    lien on the consumers' principal dwelling to the extent there
    are no new advances and no consolidation of debt. The provision
    does not exempt ``high cost'' mortgages, as defined in section
    103(aa); these mortgages remain subject to full rescission
    rights.
        The requirement that the refinancing relate back to an
    initial residential mortgage transaction prevents unscrupulous
    home improvement contractors from making loans to consumers
    with no existing liens on their homes for the purchase of
    ``improvements'' and then refinancing that debt to avoid
    rescission rights. In addition, the exemption only applies to a
    refinancing to the extent that no consolidation of debt and no
    new advances are involved. However, if a consumer refinances a
    residential mortgage transaction, (with a consolidation of debt
    or new advances) regardless of the remaining principal amount
    and subsequently refinances (with no consolidation or no new
    advances), the entire new refinancing is exempt from
    rescission. Thus, a refinancing with new advances within a
    series of refinancings will not affect a future refinancing's
    exemption from rescission, provided that the future refinancing
    does not involve a consolidation of existing debt and new
    advances.
                 Section 108. Tolerances; Basis of Disclosures

        (a) Tolerances for Accuracy.--The two key disclosures
    required by TILA are the finance charge and the annual
    percentage rate (the ``APR''). In 1980, Congress amended
    section 107(c) of TILA to explicitly provide a tolerance of
    one-eighth of one percent in calculating the APR; no statutory
    tolerance was specified for calculating the finance charge. The
    Board subsequently adopted, as a footnote to Regulation Z, a
    tolerance for finance charge calculations for closed-end credit
    of $5 for an amount financed up to $1000 and $10 for an amount
    financed greater than $1000. 12 C.F.R. Sec. 226.18 n. 41. Since
    every transaction subject to TILA has APR and finance charge
    disclosures, the lower of the two tolerances ultimately
    determines whether a violation has occurred. Section 108(f)
    provides a finance charge tolerance of one-half the APR
    tolerance set forth in section 107(c) but includes a floor of
    $25 and a ceiling of $200. The provision is not intended to
    permit bad-faith intentional understatements of finance
    charges.
        The amendment provides that a disclosed finance charge that
    is greater than the actual finance charge shall be considered
    accurate for purposes of TILA. This language reinforces section
    103(z) which allows for overstatements without imposing
    liability.
        The amendment also implements a different tolerance for
    determining if the finance charge is accurate for purposes of
    rescission. By providing a finance charge tolerance of one-half
    of one percent of the loan amount, the penalty of rescission
    will be limited to those circumstances in which there has been
    a substantial disclosure error.
        (b) Basis of Disclosure for Per Diem Interest.--Interim
    interest, the interest due for the period from loan closing
    until the date of the first payment, is regularly paid at the
    closing. However, it can be difficult to accurately calculate
    this charge at the time documents are prepared for the closing
    since interim interest, unlike other charges, changes if the
    date of closing is advanced or delayed. The existing regulation
    is unclear with respect to a creditor's right to estimate
    interim interest or treat it as a minor irregularity. If the
    loan is consummated or funded on a date other than the date
    anticipated when disclosures were prepared (for example,
    because the consumer is unable to attend closing on the
    targeted date), the finance charge disclosure may become out of
    the range of tolerance. This provision allows creditors to have
    documents produced for the closing and sent to the closing
    agent based on the expected closing date and the information
    available to the creditor at the time the documents are being
    prepared.

                      Section 109. Limitation on Liability

        Responding to the more that 50 nation-wide class actions
    that have been filed in the last year based on the Rodash
    decision, this amendment eliminates liability based on the
    treatment of specific types of charges. The limitation on
    liability extends to claims based on disclosure of a finance
    charge, or other numerical disclosure, that is within the
    tolerances established by this legislation. In addition, the
    limitation includes a provision protecting creditors from
    liability when they overstate an amount or percentage to be
    disclosed.
        The amendment also eliminates creditor liability for use of
    the incorrect form for providing the consumer with notice of
    his or her rescission rights. Existing section 125(a) of TILA
    requires the creditor to give the consumer notice of the right
    to rescind in accordance with regulations of the Board. The
    Board has adopted two model forms, Form H-8 and Form H-9, for
    notice of the consumer's right to rescind in closed end
    transactions. The forms are labelled, respectively,
    ``Rescission Model Form (General)'' and ``Rescission Model Form
    (Refinancing''. This amendment eliminates creditor liability
    where a creditor has provided the consumer with notice of the
    right of rescission using a model form but selected the
    incorrect model form or a written notice based on the incorrect
    model form.
        The liability limitations set forth in this section do not
    apply to class actions for which final orders certifying the
    class were entered prior to January 1, 1995, and to individual
    actions and actions brought by the named consumers in any class
    action filed before June 1, 1995.

                Section 110. Limitation on Rescission Liability

        This section responds to a court opinion that held that a
    lender's reliance on either form of rescission notice published
    and adopted by the Federal Reserve Board was misplaced. Section
    110 provides that where a creditor selects the appropriate
    Federal Reserve Board form of notice and properly completes the
    form, the borrower cannot rescind on the basis of improper
    notice. The Federal Reserve Board is directed to reexamine
    forms that have been adopted to eliminate further confusion
    facing creditors and consumers.

                      Section 111. Calculation of Damages

        Section 130(a) of TILA allows a consumer to recover both
    actual and statutory damages in connection with TILA
    violations. Congress provided for statutory damages because
    actual damages in most cases would be nonexistent or extremely
    difficult to prove. To recover actual damages, consumers must
    show that they suffered a loss because they relied on an
    inaccurate or incomplete disclosure.
        Recognizing the difficulty of proving actual damages and
    the increase in costs involved in mortgage lending, this
    amendment increases the statutory damages available in closed
    end credit transactions secured by real property or a dwelling
    to a minimum of $250 and a maximum of $2,500.

                        Section 112. Assignee Liability

        (a) Violations Apparent on the Face of Transaction.--
    Section 131(a) of TILA currently provides that assignees are
    liable only if the violation is apparent on ``the face of the
    disclosure statement.'' To lessen the burden on the secondary
    market while maintaining the deterrent the provision has on
    unscrupulous lenders, this amendment to section 131 provides
    that, for closed end loans secured by real property, the ``face
    of the disclosure statement'' refers only to the Truth In
    Lending disclosure document, any itemization of the amount
    financed and any other disclosure of disbursement, and not to
    ``other documents assigned'' generally. Following Federal
    Reserve Board review pursuant to section 106(g) and section 102
    of this legislation, it is anticipated that the assignee will
    be able to determine compliance based on a review of a single
    format of disclosure.
        (b) Servicer not Treated as Assignee.--A number of recent
    consumer lawsuits against mortgage loan servicers have claimed
    the servicer is an assignee of the creditor who made the loan
    and is therefore liable for errors under section 131. This
    provision clarifies that the loan servicer (the entity
    collecting payments from the consumer and otherwise
    administering the loan) is not an ``assignee'' under the TILA
    unless the servicer is the owner of the loan obligation.
    Moreover, a servicer shall not be deemed to be an owner of the
    loan on the basis of an assignment of the loan or the mortgage
    for administrative convenience in servicing the loan. A
    ``servicer'' is defined by reference to section 6(i)(2) of the
    RESPA. The TILA continues to apply to servicers who were the
    original creditors and then sold the loan but retained
    servicing rights. This amendment does not change the law;
    rather, it provides courts with further specific guidance on
    the interpretation of current law.

                 Section 113. Rescission Rights in Foreclosure

        This amendment adds a new subsection to section 125 of TILA
    giving consumers the right to rescind a loan within the three-
    year time period established in section 125(f) of TILA as a
    defense if the creditor brings an action to foreclose on the
    consumer's principal dwelling in three specific instances:
    improper treatment of borrower-paid mortgage broker fees in
    calculating the finance charge, use of the incorrect form of
    notice of the right of rescission, and disclosure of a finance
    charge which understates the actual finance charge by more than
    $35. The consumer protection provisions of this section are
    intended to benefit consumers that are unable to meet their
    mortgage obligations and are not intended as a mechanism
    whereby consumers can avoid their obligations by defaulting and
    then raising the defense in foreclosure. Nothing in this
    section is intended to override the exceptions to the rights of
    rescission created in section 125(e).
        Section 125(f) of TILA provides that the consumer's right
    of rescission expires on the earlier of three years after the
    date of consummation of the transaction or upon the sale of the
    property even if the consumer has not received the required
    disclosures or forms. Rescission rights expire in three years.
    The time period shall not be extended except as explicitly
    provided in section 125(f) relating to agency enforcement
    proceedings. However, section 125(f) does not affect any
    equitable remedies that may be available under State or common
    law.

                         Section 114. Recovery of Fees

        Section 114 makes a borrower who exercises a right of
    rescission liable under TILA for any appraisal reports or
    credit reports charges.
            section 115. homeownership debt counseling notification

        Section 115 repeals homeownership debt counseling
    notification under the Housing and Urban Development Act of
    1968. Homeownership is widely available through the private
    sector. Therefore, a government program is both duplicative and
    wasteful.

                   section 116. home mortgage disclosure act

        The HMDA requires a financial insitution with assets of $10
    million or more that has a headquarters or a branch within a
    metropolitan statistical area to compile and report data
    related to home mortgage loans. Section 116(a) modifies the
    HMDA to exempt institutions with $50 million in assets or less
    from the reporting requirements. The Federal Reserve Board is
    also given the discretion to further exempt institutions with
    assets of $50 million or greater if the Board determines that
    the burden of compliance with the HMDA outweighs the usefulness
    of the information required to be reported. Finally, section
    116(b) permits depository institutions to keep such data in
    their home office (instead of in each branch) and make it
    available upon written request.

                           section 117. applicability

        The amendments made by section 106(a), (d), (e), and (f)
    and sections 108, 112 and 113 will apply to all consumer credit
    transactions in existence or consummated on or after the date
    of enactment. Subsections 106(a), (d), (e) and (f) (certain
    charges) and section 112 (assignee liability) apply
    retroactively. In contrast, section 106(b) regarding the
    treatment of borrower-paid mortgage broker fees applies
    prospectively. Sections 108 and 113 are applied retroactively.
    Section 109 (limitation on liability) applies to all existing
    transactions. The remaining sections, section 107 (exemption
    for non-cashout refinancings), section 111 (statutory damages)
    and section 110 (limitation on rescission liability), apply
    prospectively. However, nothing in this section is intended to
    change the law retroactively with respect to individual actions
    or counterclaims filed before June 1, 1995, class actions for
    which a final order certifying the class was entered before
    January 1, 1995, actions by named individual plaintiffs in any
    class action filed before June 1, 1995, or any consumer credit
    transactions with respect to which a timely notice of
    rescission was sent to the creditor before June 1, 1995 as
    provided in section 109(a) (new section 139(b) of the TILA).

               Subtitle B--Community Reinvestment Act Amendments

                section 121. expression of congressional intent

        Section 121 amends the Congressional purpose for the CRA by
    stating that in encouraging financial institutions to meet the
    credit needs of their communities, regulators are not supposed
    to impose additional regulatory burden or paperwork on
    financial institutions.

               section 122. community reinvestment act exemption

        Section 122 exempts from the examination requirements of
    the CRA any financial institution if the institution and the
    holding company which controls the institution have not more
    than $100 million in assets (which is to be adjusted for
    inflation).

         section 123. self-certification of community reinvestment act
                                   compliance

        Section 123 allows a financial institution with no more
    than $250 million in assets to self-certify compliance with the
    CRA, provided the institution has not been found to have
    engaged in a pattern or practice of illegal discrimination
    under the FHA or the ECOA within the past 5 years and has a
    current CRA rating of ``satisfactory'' or ``outstanding.'' This
    section also requires the financial institution to maintain a
    public notice of self-certification and provides for regulatory
    review of self-certification reasonableness during each
    examination for safety and soundness. In addition, this section
    provides for the institution to be examined for CRA compliance
    if the institution's self-certification is found to be ``not
    reasonable.'' If after the regular CRA exam an institution
    receives a less than ``satisfactory'' CRA rating, it shall not
    be allowed to self-certify again for a period of five years.

               section 124. community input and conclusive rating

        Section 124 amends the CRA to establish a new mechanism for
    community input for an institution's CRA examination by
    providing the public advance notice in the Federal Register of
    an institution's CRA examination. After the Federal financial
    supervisory agency provides such notice and reviews all timely
    comments, the financial institution is provided a conclusive
    CRA rating until its next CRA examination. A reconsideration of
    an institution's rating may be requested within 30 days of the
    disclosure of the rating to the public.
        Under section 124(c), an institution's CRA record is taken
    into account in the overall evaluation of the condition of an
    institution rather than at the time of an application for a
    deposit facility. Current law requires the regulator to take
    into consideration an institution's CRA record when it applies
    for a deposit facility.

              section 125. special purpose financial institutions

        Section 125(a) requires the appropriate Federal financial
    supervisory agency, in evaluating the CRA records of special
    purpose institutions, to take into account the nature of the
    business of such institutions and the amount of deposits
    received by such institution. Subsection (b) defines the term
    ``special purpose institution'' to mean a financial institution
    that does not generally accept deposits in amounts less than
    $100,000 dollars. Such institutions include, but are not
    limited to, wholesale, credit card and trust institutions.
      SECTION 126. INCREASED INCENTIVES FOR LENDING TO LOW- AND MODERATE-
                               INCOME COMMUNITIES

        Section 126 revises the CRA to expand the category of
    capital investments, loan participations, and other ventures
    for which an institution can receive CRA credit. Under current
    law, in evaluating the record of a non-minority-owned and non-
    women-owned financial institution, an agency may consider as a
    factor capital investment, loan participants, and other
    ventures undertaken by the institution in cooperation with
    minority- and women-owned financial institutions and low-income
    credit unions, provided that these activities help meet the
    credit needs of local communities in which such institutions
    and credit unions are chartered.
        In order to encourage institutions to participate in
    transactions that have the effect of providing credit to low-
    and moderate-income neighborhoods, regardless of whether those
    neighborhoods are in an institution's community, section 126
    requires the agencies to give institutions credit for
    investments in or loans to any minority or women's depository
    institution or low-income credit union. The agencies are also
    directed to give credit for participation in any joint venture
    or other entity or project which provides benefits to any
    distressed community, whether or not the distressed community
    is where the institution is chartered to do business.
    Institutions must also receive credit for investments in or
    loans to targeted low- and moderate-income communities,
    including real property loans to such communities.
        Finally, the agencies are required to consider equally with
    other factors capital investment, loan participation and other
    ventures undertaken by the institution in cooperation with
    minority and women owned financial institutions and low income
    credit unions to the extent that these activities help meet the
    credit needs of the community in which these institutions are
    located. Capital investment, loan participations, and other
    ventures undertaken by institution in cooperation with a
    community development financial institution (so long as the
    loans and other financial services provided to low- and
    moderate-income persons and small business are meeting the
    credit needs of the local communities served by the majority-
    owned institution) are also to be considered equally with all
    other factors.

       SECTION 127. PROHIBITION ON ADDITIONAL REPORTING UNDER COMMUNITY
                                REINVESTMENT ACT

        This section prohibits the Federal financial institution
    regulators from requiring additional reporting or recordkeeping
    from financial institutions as a result of any regulations
    prescribed under the CRA.

                        SECTION 128. TECHNICAL AMENDMENT

        The Riegle-Neal Interstate Banking and Branch Efficiency
    Act of 1994 modified the CRA to include a requirement to have a
    separate discussion of the findings and conclusions of a CRA
    report for each metropolitan area in which a regulated
    depository institution maintains one or more domestic branch
    offices. Under current law, this requirement applies to all
    regulated depository institutions including institutions that
    are located in only one state. The legislative intent of the
    provision was to have the requirement apply only to regulated
    institutions with interstate branches. Section 128 makes a
    technical revision to the CRA that provides that the
    requirement apply only to regulated banks with interstate
    branches.

                       SECTION 129. DUPLICATIVE REPORTING

        Section 129 exempts institutions which are members of the
    Federal Home Loan Bank System from meeting the Federal Home
    Loan Bank Act's community investment and service requirements
    if the institution has received a CRA rating of ``outstanding''
    or ``satisfactory''.

        SECTION 130. COMMUNITY REINVESTMENT ACT CONGRESSIONAL OVERSIGHT

        Section 130 requires each Federal banking agency to report
    to Congress by December 31, 1996 and by December 31, 1997,
    respectively, on the implementation of the CRA regulations
    prescribed after the date of enactment H.R. 1858. These reports
    are to include input from the regulated financial institutions
    and quantifiable measures of the cost savings of the new CRA
    regulations and their effectiveness in achieving CRA
    objectives.

                   SECTION 131. CONSULTATION AMONG EXAMINERS

        Depository institutions frequently are subject to multiple
    exams by the same agency. For example, an institution may have
    an annual safety and soundness exam as well as a CRA exam and a
    trust department exam, all of which may be conducted at
    separate times. These separate and uncoordinated exams may
    result in inconsistent recommendations to an institution. Sec.
    131 is intended to reduce the burden placed on banks as a
    result of multiple exams by requiring each agency to direct is
    examiners to consult on examination activities related to an
    institution and resolve any inconsistencies in the examiners'
    recommendations. In addition, section 131 directs that each
    agency appoint an ``examiner-in-charge'' who is responsible for
    consultation with all examiners of an institution.

                     SECTION 132. LIMITATION ON REGULATIONS

        Section 132 provides that no CRA regulation may be
    promulgated which would require financial institutions to make
    loans to any uncreditworthy person that would jeopardize the
    safety and soundness of the institution. In addition, no
    regulation prescribed under the CRA shall require a financial
    institution to make a loan on the basis of any discriminatory
    criteria prohibited under any U.S. law. It also clarifies that
    no regulation shall prevent or hinder in any way a financial
    institution's full responsibility to provide credit to all
    segments of its community. Finally, it clarifies that these
    regulations shall encourage financial institutions to extend
    credit to all creditworthy persons, consistent with safety and
    soundness.
                      Subtitle C--Consumer Banking Reforms

                         Section 141. truth in savings

        Section 141 revises the TISA to eliminate provisions that
    have resulted in unnecessary and overly complex regulations.
    The revisions to the TISA retain the basic components of that
    Act relating to disclosure of account fees, charges, penalties
    and simple interest rates. Financial institutions would
    continue to disclose minimum balance requirements at the time a
    consumer opens an account or upon request and would also
    continue to be required to disclose a change in the terms of an
    account at least 30 days before such change becomes effective.
    Section 141 also retains the prohibition against deceptive and
    misleading advertising of accounts.
        The changes that section 141 makes to the TISA primarily
    concern the requirement that financial institutions disclose
    the ``annual percentage yield'' for accounts and the
    application of civil liability for violations of the TISA. The
    TISA currently requires the Federal Reserve Board to develop a
    formula for calculation of an annual percentage yield.
    Development of such formula has proved to be extremely
    difficult. Furthermore, it appears that disclosure of an annual
    percentage yield may not provide consumers with significantly
    more information concerning an account than disclosure of the
    simple interest rate. As such, the requirement for financial
    institutions to disclose an annual percentage yield is
    repealed.
        Section 141 also removes the civil liability provisions for
    violations of the TISA. The imposition of civil liability for
    violation of the TISA has resulted in financial institutions
    seeking numerous clarifications and commentaries from the
    Federal Reserve Board increasing the regulatory burden for both
    the industry and the Board. Accordingly, the civil liability
    provisions are repealed. The federal banking agencies would
    still retain the authority to take administrative actions to
    enforce the TISA.

                        section 142. information sharing

        Section 142 pertains to the sharing of information among
    depository institutions and their affiliates and subsidiaries
    where such sharing or communication may be restricted or
    limited by law. This section does not authorize the sharing of
    information with persons or entities other than affiliates or
    subsidiaries of a depository institution. In addition, this
    section is not intended to restrict or otherwise affect the
    sharing or communication of information that is otherwise
    permissible. Before information regarding a consumer may be
    shared or communicated in reliance on this provision, the
    depository institution, subsidiary or affiliate must disclose
    to the consumer that such information may be communicated or
    shared and the customer must be given the opportunity to direct
    that the information not be communicated or shared. This
    section is not intended to supersede in any way any sales
    practice rules issued by the National Association of Securities
    Dealers. The Committee is of the opinion that such sales
    practice rules concerning information sharing should apply
    equally to all affiliates of a broker dealer.

            section 143. electronic fund transfer act clarification

        Section 143 clarifies that provisions of the EFTA do not
    apply to stored value cards or value stored on such cards
    except for transactions where the card is actually used to
    access an account to effect a transaction. In addition,
    computers, computer-driven programs, or software that are
    functionally equivalent to stored value cards are also exempted
    from EFTA.

     section 144. limit on restitution for truth in lending violations if
               safety and soundness of violator would be affected

        Under current law, Section 108(e) of TILA prescribes rules
    for reimbursement of inadequately disclosed finance charges,
    and requires the federal financial institution supervisory
    agencies to order restitution to consumers of amounts charged
    but not adequately disclosed. Section 144 allows supervisory
    agencies to take into account the safety and soundness of that
    institution when requiring restitution from an institution.
    Under the section, two alternatives to full, immediate
    restitution exist. First, an agency is able to order partial
    restitution, in an amount that would not have a significantly
    adverse impact on the lender's safety and soundness. Second, an
    agency is allowed to order restitution in the full amount, but
    to be paid over a period of time to avoid a significantly
    adverse impact. In the case of the federal financial
    institution supervisory agencies, an agency cannot order
    partial restitution or restitution in partial payments over an
    extended period unless the agency made a factual determination
    that full, immediate restitution would cause the creditor to
    become undercapitalized pursuant to such agency's regulations
    promulgated under section 38 of the Federal Deposit Insurance
    Act.

              Subtitle D--Equal Credit Opportunity Act Amendments

                       section 152. findings and purpose

        Section 152 states that the purpose of this legislation is
    to reconcile and coordinate the notice requirements under the
    ECOA amd FCRA.

              section 153. equal credit opportunity act amendments

        Section 153 coordinates notices required under the ECOA
    resulting from adverse credit actions with notices required
    under the FCRA where requirements of the two Acts overlap. It
    also ensures that when credit is denied based on a consumer
    report, the adverse action notice must state that the credit
    denial was based on information contained in the credit report.
    In addition, the notice must contain: (1) the name, address,
    and telephone number of the consumer reporting agency making
    the report; and, (2) a statement of the consumer's right to
    obtain a free copy of the consumer repot and to dispute the
    accuracy or completeness of any information in the consumer
    report. In addition, the ECOA is amended by limiting liability
    for violations of the adverse notice requirements provided for
    in section 701(d) if it can be shown that the creditor
    maintained reasonable procedures to assure compliance.
               section 154. fair credit reporting act amendments

        Section 154 coordinates the notices required under the FCRA
    resulting from adverse credit actions with notices required
    under the ECOA where requirements of the two Acts overlap.

                    section 155. incentives for self-testing

        Section 155 is designed to encourage lenders to conduct
    self-tests in order to determine their compliance with fair
    lending laws. First, the section establishes a privilege for
    lenders who self-test for compliance with the ECOA or the FHA
    from having such tests used against them in any proceeding or
    civil action brought under these acts where the lender has
    identified discriminatory practices and has taken appropriate
    corrective actions. Such tests, however, can be used if the
    lender conducted them at the request of an agency, they have
    been disclosed to a third party by the lender, if they are used
    as an affirmative defense by the lender, or in determining the
    remedy for FHA or ECOA violations. Second, the section grants
    the Federal banking regulators discretionary authority to refer
    evidence of discrimination contained in a self-testing report
    to the Attorney General or the Secretary of HUD under certain
    circumstances.
        Ambiguities under current law in the self-testing area
    create disincentives for financial institutions to test their
    activities with the nation's fair lending laws. Under current
    law, the possibility exists that self-tests will be used as
    evidence against a lender in a later administrative proceeding
    or civil action. The privilege and discretionary referral
    provided for under section 155 are designed to eliminate these
    current disincentives.
        Under this section, the appropriate federal department or
    agency is given the authority to determine which kinds of tests
    will qualify for the privilege. Although paired testing is a
    widely accepted form of testing for noncompliance, other
    testing methods may produce similar and reliable evidence of
    unlawful practices and may be less cost-prohibitive for smaller
    institutions. Therefore, these tests also warrant protection
    under this section.

                      section 156. credit scoring systems

        Section 156 amends the ECOA to clarify that credit
    decisions based solely on an empirically derived, demonstrably
    and statistically sound, credit scoring system, as defined by
    the Federal Reserve Board in regulations prescribed under this
    title, shall be in compliance with the non-discrimination
    requirements under ECOA (subsection (a)) so long as the system
    does not use any category protected under subsection (a), does
    not use any functional equivalent of such a category, and does
    not use any criterion that has a discriminatory effect on any
    category unless the use of the criterion is justified by
    business necessity and there is no less discriminatory
    alternative available. The term business necessity as well as
    the duty of showing a less discriminatory alternative shall be
    construed consistent with U.S. Supreme Court precedent such as
    Griggs v. Duke Power Company, 401 U.S. 424 (1971) and
    Albermarle Paper Company v. Moody, 422 U.S. 405 (1975).

     Section 157. Consultation by Attorney General required in Nonreferral
                                     cases

        Section 157 requires the Attorney General to consult with
    the appropriate regulatory agency prior to bringing a civil
    action. The Attorney General and the regulatory agencies are to
    work in close cooperation to avoid unnecessary duplication of
    effort, and to avoid unnecessary burdens on regulated entities.

                  Subtitle E--Consumer Leasing Act Amendments

                            Section 163. Regulations

        Section 163 amends the Consumer Credit Protection Act by
    directing the Federal Reserve Board to address consumer leasing
    issues through regulation and requiring the Board to publish
    model disclosure forms to facilitate compliance with the
    disclosure requirements and to aid consumers in understanding
    leasing transactions.

                    Section 164. Consumer Lease Advertising

        Section 164 rewrites the disclosure requirements for
    consumer lease advertising. Under this section, when an
    advertisement states that an initial payment or that no initial
    payment is required, the advertisement must also state that the
    transaction is a lease; the number of payments; the
    applicability of a security deposit; the number, amount and
    timing of payments; and certain other pertinent information. In
    addition, the special rules governing radio advertisements are
    repealed under this section.

                        Section 165. Statutory penalties

        Section 165 amends section 185(a) of the Consumer Credit
    Protection Act to limit a creditor's liability for statutory
    penalties for failure to provide certain consumer lease
    disclosures.

                 Subtitle F--Federal Home Loan Bank Amendments

     Section 171. Application for Membership in the Federal Home Loan bank
                                     System

        Section 171 establishes that an applicant for membership in
    the Federal Home Loan Bank (FHLB) System may submit the
    application in the district where the applicant's principal
    place of business is located rather than submit the application
    to the Federal Housing Finance Board in Washington. It also
    establishes that applicants may apply in an adjoining district
    if it is convenient and meets with the approval of the Federal
    Housing Finance Board.
             section 172. federal home loan bank external auditors

        Section 172 provides that General Accounting Office audits
    of FHLBs shall not be limited to periods during which
    government capital has been invested in them. It also prohibits
    the Federal Housing Finance Board from participating in the
    hiring of an external auditor by the FHLBs, other than to
    establish requirements for audit contracts.

                 TITLE II--STREAMLINING GOVERNMENT REGULATIONS

                     Subtitle A--Regulatory Approval Issues

     section 201. streamlined nonbanking acquisitions by well capitalized
                     and well managed banking organizations

        Under current law, a bank holding company must submit a
    written notice to the Federal Reserve Board at least 60 days
    before engaging in a nonbanking activity. The Federal Reserve
    Board determines whether the activity is so closely related to
    banking or managing or controlling banks as to be a proper
    incident thereto.
        Section 201 permits well capitalized and well managed bank
    holding companies to engage, either directly or through an
    acquisition, in nonbanking activities previously approved by
    the Federal Reserve Board without prior notice or with an
    abbreviated notice. In order to be eligible for these expedited
    procedures (1) the bank holding company must be well
    capitalized and well managed; (2) the company's lead insured
    depository institution must be well capitalized and well
    managed; (3) insured depository institutions controlling 80
    percent of the company's banking assets must be well
    capitalized; (4) insured depository institutions controlling 90
    percent of the company's banking assets must be well managed;
    (5) no insured depository institution controlled by the company
    may be undercapitalized or poorly managed (with a limited
    exception for recently acquired depository institutions); and,
    (6) neither the bank holding company nor any subsidiary
    depository institution may be the subject of any enforcement
    action, order, or administrative enforcement proceeding within
    the prior twelve months. In addition, the book value of the
    assets to be acquired may not exceed 10 percent of the holding
    company's consolidated total risk-weighted assets, and the
    price paid may not exceed 15 percent of the consolidated Tier 1
    capital of the company. All activities must be conducted in
    compliance with any applicable regulations, orders, and
    interpretations of the Federal Reserve Board.
        Qualifying bank holding companies may engage de novo in any
    ``laundry list'' nonbanking activity approved by the Federal
    Reserve Board by regulation without prior notice, but must
    inform the Board within 10 days after commencing the activity.
    Qualifying bank holding companies wishing to engage in an
    activity approved by the Federal Reserve Board by order, or
    wishing to acquire any nonbanking company, must provide 12 days
    prior notice to the Board. Prior to expiration of the notice
    period, the Federal Reserve Board may require the bank holding
    company to comply with statutory notice and review provisions
    that generally apply to proposals under section 4(c)(8).

    section 202. streamlined bank acquisitions by well capitalized and well
                         managed banking organizations

        Section 202 amends the notice procedures of the BHCA to
    permit well capitalized and well managed bank holding companies
    that are rated ``satisfactory'' or ``outstanding'' for CRA
    performance to acquire another bank, without prior approval,
    when the acquisition is limited in size, meets competitive
    criteria established by the Federal Reserve Board (in
    consultation with the Attorney General), and meets applicable
    geographical and other established statutory requirements. In
    addition, the bank holding company may not have been the
    subject of any enforcement action, order, or administrative
    enforcement proceeding within the twelve months prior to the
    acquisition.
        Section 202 requires bank holding companies to provide the
    Federal Reserve Board with brief advance notification of the
    proposal to allow the Board to require a full notice or
    application if warranted by the specific case. It also
    clarifies that the Department of Justice's anti-competitive
    review remains applicable to notices filed under the
    streamlined procedures. Under these streamlined procedures the
    Attorney General will receive notification of the proposed
    acquisition at the same time as the Federal Reserve Board. The
    Attorney General shall advise the Federal Reserve Board during
    the review period in writing if any competitive concerns exist
    with respect to the transition. If the Attorney General advises
    the Federal Reserve Board that no such concerns exist, the
    post-approval waiting period in section 11(b) shall not apply.

      section 203. eliminate filing and approval requirements for insured
     depository institutions already controlled by the same holding company

        Section 203 amends the Federal Deposit Insurance Act (FDIA)
    and the National Bank Consolidation and Merger Act to allow
    merger of banks controlled by the same bank holding company
    without having to comply with certain filing and approval
    requirements. Section 203 requires that these transactions meet
    the recently enacted interstate branching requirements. The
    responsible agency for the resulting bank may require an
    application under these Acts, if the facts of the specific case
    warrant.

        section 204. eliminate redundant approval requirement for oakar
                                  transactions

        Section 204 amends the FDIA to remove the duplicative
    approval requirements for the merger of a bank and a savings
    association under thee Oakar Amendment to the FDIA. Section 204
    leaves requirements under the Bank Merger Act intact. Section
    204 does not remove the other provisions for Oakar
    transactions, including the requirement that the resulting
    institution remain adequately capitalized and the requirement
    that assessments paid by the resulting institution go to the
    appropriate FDIC insurance fund.
    section 205. elimination of duplicative requirements imposed upon bank
     holding companies and other regulatory relief under the home owners'
                                    loan act

        Section 205 amends the Home Owners' Loan Act (HOLA) to
    eliminate duplicative regulation of bank holding companies
    under the BHCA and the HOLA. Currently, a registered bank
    holding company that controls a savings association is
    supervised by the Federal Reserve Board and is also subject to
    the requirements of the HOLA. As such, it must obtain approval
    from the OTS for acquisitions and must register with the OTS as
    a savings and loan association holding company. The amendment
    eliminates duplicative supervision under the HOLA. However, the
    amendment does not free savings associations owned by bank
    holding companies from the Qualified Thrift Lender (QTL) test
    or from any other requirements applicable to savings
    associations under Federal law.
        Section 205 also amends the BHCA to ensure that the Federal
    Reserve Board and the OTS will cooperate in the supervision of
    bank holding companies that control savings associations. The
    Federal Reserve Board must seek and consider the views of the
    Director of the OTS in considering any application or notice by
    a bank holding company to acquire a savings association. The
    Federal Reserve Board also must consult with the Director, as
    appropriate, in establishing the scope of inspections of bank
    holding companies that control savings associations. Such
    consultation should be more involved when savings associations
    make up a substantial portion of the assets of the holding
    companies. The Federal Reserve Board must also, upon request of
    the Director, provide the Director with any inspection report
    or any other supervisory material relating to a bank holding
    company that controls a savings association. Finally, the
    Federal Reserve Board and the Director are required to
    cooperate in any enforcement action against a bank holding
    company that involves a savings association controlled by the
    company.
        Section 205(d) reduces the regulatory and paperwork burden
    faced by savings and loan associations by allowing them to
    satisfy the QTL test required under the HOLA by meeting the
    Qualified Thrift Asset (QTA) test under the Internal Revenue
    Code.
        Under HOLA the QTL test requires thrifts to have at least
    65% of their portfolios in mortgages and mortgage-related
    products. In addition, the law also allows a limited amount of
    consumer loans, commercial loans and educational loans to be
    considered qualified lending. Thrifts must meet the QTL test in
    order to receive certain benefits not afforded to banks.
        Under the tax code, the QTA test requires thrifts to have
    at least 60% of their assets in certain loans and investments
    listed in the code. The list includes residential mortgage
    loans, but not commercial loans or many types of mortgage
    backed securities. The two tests are similar, but not
    identical. In addition, the QTL test is computed on the basis
    of portfolio assets and the tax test on total assets. By
    meeting the QTA test, thrifts receive certain tax benefits, for
    example, the choice of using the experience method or the
    percentage of taxable income method of computing their bad debt
    reserve. This subsection does not affect tax law in any way. It
    merely reduces the paperwork burden on thrifts by no longer
    requiring them to juggle their assets to ensure that they have
    the correct balance of assets to meet their two similar but
    different tests.

       section 206. eliminate requirement that approval be obtained for
                                  divestitures

        Section 206 eliminates a statutory presumption that a bank
    holding company that divests shares of any company to a third
    party investor in a transaction funded by any subsidiary of the
    bank holding company is presumed to continue to control those
    shares unless the Federal Reserve Board determines that the
    divestiture is genuine. The presumption was intended to prevent
    sham divestitures, but the application burden imposed on the
    banking industry has proved to outweigh the benefits of this
    requirement. The Federal Reserve Board can detect sham
    transactions through the examination process.

             section 207. eliminate unnecessary branch applications

        Section 207 eliminates the notice and approval requirements
    concerning the operation of branches for well-capitalized,
    CAMEL 1 or 2 institutions with ``outstanding'' or
    ``satisfactory'' CRA ratings. This section does not change in
    any way the geographic restrictions that govern the
    establishment or operation of a branch office.

      section 208. eliminate branch application requirements for atms and
                               similar facilities

        Section 208 amends the McFadden Act and the FDIA to provide
    that automated teller machines (ATMs) or remote service unit
    (RSUs) owned by a depository institution are not considered to
    be branches for purposes of filing an application to establish
    a branch so long as they are owned and operated at sites at
    which the bank could operate a branch. Existing law regarding
    when other categories of ATMs and RSUs are to be considered
    branches is not affected by this amendment.

    section 209. eliminate requirement for approval of investments in bank
              premises for well capitalized and well managed banks

        Section 209 amends the Federal Reserve Act to allow well
    capitalized institutions which have received one of the two
    highest composite CAMEL ratings to invest up to 150% of the
    institution's capital in its premises without obtaining prior
    approval.

      section 210. eliminate unnecessary filing for officer and director
                                  appointments

        Section 32 of the FDIA requires insured depository
    institutions and depository institution holding companies to
    file a notice with their regulators at least 30 days before
    hiring new directors or senior executive officers where the
    institution is undercapitalized or otherwise in troubled
    condition, has been chartered less than two years, or the
    institution or holding company has undergone a change in
    control during the past two years. In these situations, the
    individuals would have to undergo background checks.
        Section 210 adds a provision that lets the agencies waive
    the notice requirement on a case-by-case basis in appropriate
    circumstances.

       section 211. streamlining process for determining new nonbanking
                                   activities

        Section 211 amends the BHCA to eliminate the hearing
    requirement contained in Section 4(c)(8) of that Act. Section
    211 also amends section 4(c)(8) to create an exception to that
    section's general prohibition on bank holding company insurance
    activities to allow bank holding companies to own insurance
    affiliates in accordance with State insurance laws. The
    provision states that it shall be ``closely related to
    banking'' to provide insurance as a principal, agent, or broker
    in any State, in full compliance with the laws and regulations
    of such state that apply uniformly to each type of insurance
    license or authorization in that State, including anti-
    affiliation laws.

                 section 212. disposition of foreclosed assets

        Under current law, bank holding companies are accorded up
    to five years to dispose of stock acquired as a result of a
    loan foreclosure; under certain circumstances, real estate
    assets may be held for up to ten years. National banks may hold
    both foreclosed real estate and foreclosed stock for a maximum
    period of 10 years. Section 212 would equalize the treatment of
    national banks and bank holding companies by amending section
    4(c)(2) of the BHCA to provide authority for the Federal
    Reserve Board to approve applications to hold foreclosed stock
    for an additional five years. An extension beyond the initial
    five year period would be dependent on a showing by the bank
    holding company that it has made a good faith attempt to
    dispose of the asset within five years, or that disposal within
    the initial five year period would be detrimental to the
    company. The section also eliminates the statutory requirement
    that a bank holding company must apply for an extension every
    year.

          section 213. increase in certain credit union loan ceilings

        Section 213 allows a federal credit union to make aggregate
    loans up to $50,000 to officials of the credit union without
    approval by the board of directors. Under present law, the
    aggregate loan ceiling is $10,000.

       Subtitle B--Streamlining of Government Regulations; Miscellaneous
                                   Provisions
    section 221. eliminate the per-branch capital requirement for national
                          banks and state member banks

        Section 221 eliminates section 5155(h) of the Revised
    Statues. Currently, section 5155(h) requires national bank
    associations to maintain capital for their branches as if each
    branch were a separately chartered bank. In deleting this
    subsection, national banks' capital will be held against their
    total assets and not the assets of each of their individual
    branches.

                          section 222. branch closures

        Section 222 clarifies the scope of the branch closing
    notice requirement under section 42 of the FDIA. Under section
    42, an insured depository institution that intends to close a
    branch is required to notify the customers of the branch and
    the institution's appropriate Federal banking agency 90 days
    prior to the closing.
        An interagency policy statement has interpreted section 42
    such that (1) the term ``branch'' is defined as a traditional
    brick and mortar branch and does not include an ATM or remote
    service facility; and (2) the relocation or consolidation of a
    branch does not constitute a branch closing provided that the
    relocation or consolidation of a branch does not constitute a
    branch closing provided that the relocation or consolidation is
    within the same immediate neighborhood and the same customers
    are served.
        Section 222 confirms, and in one way, broadens these
    interpretations in the intergency policy statement. ATMs are
    explicitly excluded from the definition of branch. Furthermore,
    the merger or relocation of branch is excluded from the notice
    requirement when certain conditions are met. The merger or
    relocation of a branch is excluded if the branch affected in
    located within 2.5 miles of or in the same neighborhood as
    another branch of the same institution. In other instances, the
    other branch must serve substantially all of the customers
    currently served by the branch to be closed.
        Section 222 also excludes from the notice requirements
    branch closings in connection with an emergency acquisition or
    other FDIC assistance under the FDIC. Section 222 grants the
    agencies authority to create further exceptions consistent with
    the purposes of the section.

       section 223. amendments to the depository institutions management
                                 interlocks act

        This section makes several changes to the Depository
    Institutions Management Interlocks Act. First, it increases the
    dollar thresholds in the rule currently prohibiting banks or
    bank holding companies with more than $1 billion in assets from
    having a management interlock with another nonaffiliated bank
    or bank holding company, where ever located, with assets
    greater than $500 million. This threshold would rise to $2.5
    billion and $1.5 billion, respectively, and be adjusted
    annually for inflation.
        Second, this section permits grandfathered interlocks to
    continue indefinitely (until the death or resignation of the
    official in question). Third, it restores the exemptive
    authority the regulators had prior to 1994. Fourth, it permits
    a management official of one institution or hold company to
    serve as a management official of another non-affiliated
    institution or holding company if the institutions or holding
    companies (and their affiliates) hold in the aggregate no more
    than 20 percent of the deposits in each relevant geographic
    area in which they are located.

         section 224. acceleration of appraisal subcommittee repayment

        This section requires the acceleration of repayment to the
    Treasury of a five million dollar loan held by the Financial
    Institutions Examination Council's Appraisal Subcommittee.
    Under this section, the loan is to be repaid by the end of
    Fiscal Year 1998.

     section 225. eliminate unnecessary and duplicative recordkeeping and
      reporting requirements relating to loans to executive officers and
                 permit participation in employee benefit plans

        Section 22(h) of the Federal Reserve Act governs extensions
    of credit to insiders (executive officers, directors, and
    principal shareholders) of member banks and their affiliates,
    including related interests of those insiders (such as
    companies they control). In general, section 22(h) requires
    that insider loans be within certain limits and not be on
    preferential terms. Section 22(g) of the Federal Reserve Act
    establishes special limits for extensions of credit to
    executive officers only.
        Without changing any of the core restrictions on insider
    lending, section 225 eliminates extraneous and unnecessary
    reporting requirements and ends coverage of certain persons who
    are executive officers and directors of affiliates who cannot
    affect policymaking at a bank. Section 225 does not affect the
    effectiveness of the insider lending provisions of section 22
    of the Federal Reserve Act of the Federal Reserve Board's
    Regulation O in any significant way.
        Section 225(a)(1) allows executive officers, directors, or
    principal shareholders to receive extensions of credit that are
    made pursuant to a benefit or compensation plan that is widely
    available to, and used by, employees of the bank. Such loans
    will continue to count toward the limits of section 22(h) but
    will no longer be barred as preferential. This amendment will
    permit such persons to participate in programs that allow
    reduced closing costs or a slightly favorable rate in
    connection with an employment-related relocation.
        Section 225(a)(2) allows the Federal Reserve Board to
    exempt from the restrictions of section 22(h) executive
    officers and directors of affiliates who are not involved in
    policymaking at the bank, provided that the affiliate by which
    they are employed does not represent more than 10 percent of
    the consolidated assets of the organization. Maintaining
    updated records of the identities of all these persons, and
    their related interests represent a substantial recordkeeping
    burden. For large banks, this means tracking literally
    thousands of directors and executive officers, sometimes
    overseas, as well as any company those persons control. Given
    that these people are not employed by the bank or a significant
    affiliate and cannot therefore affect the bank's policies, the
    costs of the recordkeeping requirement clearly outweigh the
    benefits.
        Section 225(b) eliminates unnecessary reporting and
    recordkeeping requirements. The crucial recordkeeping
    requirements necessary to monitor compliance with Regulation O
    are contained in the Federal Reserve Board's regulation. Each
    bank is required to track loans to its insiders and their
    related interests, and examiners make certain that loans are
    within statutory limits and that adequate records are being
    kept. Various other statutory provisions, however, impose
    unnecessary recordkeeping and reporting burdens on banks that
    are not worth the costs they impose. Section 225(b) eliminates
    these burdens.
        Section 225(c) amends section 22(g) to allow member banks
    to extend two types of credit to their executive officers: home
    equity lines not to exceed $100,000 and loans secured by
    readily marketable assets up to an amount to be set by the
    Federal Reserve Board. These loans are secured by collateral
    such that they pose minimal risk to the bank.

    section 226. expanded regulatory discretion for small bank examinations

        Current law requires annual examinations for banks with
    $250 million or more in assets and permits examinations every
    18 months for CAMEL 1 banks with less than $250 million in
    assets and for CAMEL 2 banks with less than $100 million in
    assets. The regulators may increase the CAMEL 2 threshold to
    $175 million after September 1996. Section 226 amends current
    law to permit the regulators to raise the CAMEL 2 asset
    threshold to $250 million after September 1996. In addition,
    the Federal banking agencies are required to report on a
    semiannual basis on the progress being made on implementing a
    system for coordinating examinations. The report must be filed
    until a system is implemented.

                        section 227. cost reimbursement

        This section adds corporate customers to the cost
    reimbursement provisions of Section 3415 of Title 12 of the
    U.S. Code.

     section 228. identification of foreign nonbank financial institution
                                   customers

        Section 228 repeals the responsibility of a domestic
    depository institution's obligation to maintain a listing of
    all domestic financial institutions having an account there.
    All foreign nonbank financial institutions with accounts at a
    domestic financial institution, however, would still be
    required to be identified and listed.
                    SECTION 229. PAPERWORK REDUCTION REVIEW

        Section 229 requires each Federal financial institution
    regulator and the National Credit Union Administration to
    review and repeal unnecessary internal written policies.

        SECTION 230. DAILY CONFIRMATIONS FOR HOLD-IN-CUSTODY REPURCHASE
                                  TRANSACTIONS

        Section 230 requires the Secretary of the Treasury to
    revise regulations relating to confirmations for hold-in-
    custody repurchase transactions to permit the waiver of the
    right to obtain daily written confirmations if disclosure has
    been received that adequately informed the counter party of the
    benefits of receiving daily written confirmations, including,
    but not limited to, the value of receiving confirmations in
    verifying transactions and in perfecting a security interest
    under the Uniform Commercial Code.

             SECTION 231. REQUIRED REGULATORY REVIEW OF REGULATIONS

        Section 231 requires a review of all banking regulations at
    least once every ten years in order to identify outdated or
    otherwise unnecessary regulatory requirements imposed upon
    insured depository institutions. Each regulation will be
    reviewed by the Financial Institution Examination Council (the
    Council) or one of the Federal banking agencies, depending on
    which agency or Council promulgated the regulation.
        As part of the review process, the Council or such
    appropriate Federal banking agency shall designate each
    regulation by category. On a regular schedule within the 10-
    year period, the Council or such appropriate Federal banking
    agency shall notify and solicit comments on each category from
    the pubic for their recommendations.
        Further, the Council or such appropriate Federal banking
    agency shall publish in the Federal Register a summary of the
    comments including highlighted issues and comments. When it is
    appropriate, the Council or such appropriate Federal banking
    agency shall eliminate those regulations that were found to be
    unnecessary. The Council shall report to the Congress within 30
    days of the publication a summary including significant issues
    raised during the review period, the relative merits of those
    issues, and whether the problems need to be addressed by the
    appropriate Federal banking agency or by legislation.

                     SECTION 232. COUNTRY RISK REQUIREMENTS

        Under Section 905 of the International Lending Supervision
    Act (ILSA), federal banking regulators are required to mandate
    that banks maintain special reserves when their overseas loans
    have become impaired due to a foreign borrower's inability to
    make payment. Such reserves cannot be counted as capital or
    surplus or allowances for possible loan losses and are charged
    against current income. Section 233 provides that the
    regulators may, but are not required to, impose such special
    reserves.
                            section 233. audit costs

        This section repeals the requirement that independent
    auditors attest to bank compliance with safety and soundness
    regulations and internal controls. It also inserts a
    ``privileged and confidential'' element to the annual
    management report required under Federal Deposit Insurance
    Corporation Improvement Act (FDICIA) that would permit
    regulators to designate certain information included in such
    reports as privileged and confidential and therefore not
    available to the public. The designation of information as
    privileged and confidential is not intended to alter or provide
    an exemption from any requirement to file audited financial
    statements and audit letters otherwise required under the
    federal securities laws or rules or regulations adopted
    thereunder. In addition, the section also creates a safe harbor
    for well-capitalized and well-managed banks from the
    requirements of section 36 of the FDIA except the requirement
    for an independent financial audit.

           section 234. standards for director and officer liability

        Section 234 provides that outside directors are subject to
    the same culpability standards as independent contractors in
    enforcement actions by the regulatory agencies. Under the new
    standard, regulators are required to show that an outside
    director knowingly or recklessly committed the Act in question.
    Under the present law, outside directors are subject to the
    same standards as officers and inside directors of a financial
    institution.

                     section 235. foreign bank applications

        This section amends section 7(d) of the International
    Banking Act (IBA) to permit the Federal Reserve Board to
    approve an application by a foreign bank to establish a branch
    or agency in the United States if the home country supervisor
    is working to establish arrangements for the consolidated
    supervision of such foreign bank. This changes current law,
    which mandates denial of an application unless the foreign bank
    is already subject to consolidated supervision. The mandatory
    standard of consolidated supervision has prevented otherwise
    qualified banks from entering the U.S. market, even if the home
    country supervisors are working to put in place a framework for
    consolidated supervision of the bank.
        This section also requires the Federal Reserve Board to act
    on an application within 180 days of its receipt, except that
    the Board may, after giving notice to the applicant and the
    licensing authority, extend the time for no more than an
    additional 180 day period. Such time frames are appropriate in
    light of the time that can elapse in transmitting and
    translating information to and from foreign countries. The
    amendment also permits the Board to deny an application if the
    applicant does not respond in a timely manner to requests for
    information necessary to process the application. Thus, the
    amendment establishes a definite time frame for final action
    while retaining an incentive for an applicant bank to provide
    information in a timely manner.
        The section also amends section 7(e)(1) of the IBA.
    Currently, section 7(e)(1) allows the Board to terminate a
    State-licensed office of a foreign bank if the foreign bank has
    committed a violation of law or engaged in unsafe practices in
    the United States or if the foreign bank is not subject to
    consolidated supervision by its home country authorities.
    Section 235(b) provides that, with respect to the consolidated
    supervision standard, the Board can terminate a foreign bank's
    operations for lack of consolidated supervision if the home
    country authorities are not making progress in establishing
    arrangements for the bank's consolidated supervision. Section
    235(c) provides the Board parallel authority to terminate
    federally licensed offices of foreign banks in addition to its
    current authority to terminate State-licensed offices.

              section 236. duplicate examination of foreign banks

        This section amends section 7(c) of the IBA relating to the
    Federal Reservice Board's examination authority over foreign
    banks. The amendment provides that (1) the Board must take all
    reasonable measures to coordinate examinations with the
    licensing authority of the foreign bank's branch or agency; and
    (2) a foreign bank's offices should be examined with the same
    frequency as a State or national bank (currently annually) and
    that this examination requirement may be met by an exam by
    State supervisor.
        This section also provides that the Board shall assess
    foreign banks for the costs of examinations, but only to the
    extent that State member banks are charged by the Board for
    their examination costs. This provision ensures parallel
    treatment of U.S. and foreign banks.

                         section 237. second mortgages

        This section amends the Home Ownership and Equity
    Protection Act of 1994 to apply only to subordinate mortgages.
    It also mandates the dismissal of any administrative
    enforcement proceedings or other actions which are pending on
    the date of enacting of the Financial Institutions Regulatory
    Relief Act of 1995 and are based on regulations in effect under
    the TILA with respect to high-cost residential mortgage
    transactions.

        section 238. streamlining federal deposit insurance corporation
                       approval of new state bank powers

        This section gives insured state banks and their
    subsidiaries the ability to engage in new activities by giving
    the FDIC 60 days notice as long as the institution remains in
    compliance with appropriate capital standards. The FDIC may
    extend this notice period up to 30 days for the purpose of
    issuing notices of disapproval. The FDIC may disapprove any new
    activity unless it determines that the activity would pose a
    significant risk to the appropriate insurance fund.
           section 239. repeal of call report attestation requirement

        This section repeals the three-director attestation
    requirement. This is in addition to the provision requiring an
    officer to make a declaration as to the correctness of the call
    report.

           section 240. authority of the comptroller of the currency

        Section 240 places a permanent moratorium on the authority
    of the OCC to expand bank insurance powers, without rolling
    back the status quo. The section also provides for the
    functional regulation of national bank insurance activities. In
    prescribing the terms of state supervision of insurance, the
    section provides that no provision of section 5136, or any
    other section of this Title of the revised statutes (including
    section 5136B as added by this legislation) or section 13 of
    the Federal Reserve Act may be construed as limiting or
    otherwise impairing the authority of any state to regulate.
    During consideration of H.R. 1858 by the Committee, several
    modifications were made to section 240 to clarify its
    provisions. These modifications included:
              A ban on any State prohibitions relating to the
            extent of insurance activities currently authorized for
            national banks.
              State supervision of annuities limited to disclosure
            and licensing. No ability to limit lobby sales.
              Grandfather from State regulation related to the
            extent of insurance activities for all banks in towns
            of 5000 currently engaged in insurance activities in
            all States, subject to the outcome of pending
            litigation.
              Non-discrimination provisions to require that any
            State supervisory limitation is applied equally to
            state banks and S&Ls.
              Non-discrimination language to protect against a
            State insurance regulator labeling traditional banking
            products as insurance.
              Limitation on the definition of insurance requiring
            that the definition must be tied to a State regulator's
            authority under the relevant State insurance law.
              Express protection of any rights to engage in
            insurance activities by bank holding companies under
            the BHCA.
        In addition, the Committee adopted an amendment designed to
    make it clear that State insurance regulators could not
    overstep their authority to establish the regulatory framework
    within which national banks can act as agent or broker in the
    sale of insurance. That amendment also sought to assure that
    State insurance regulators would not be able to define
    traditional banking products as insurance. It did that by
    retaining for the Comptroller of the Currency the ability to
    define the ``business of banking'' and authorizing national
    banks or their subsidiaries to engage in such activities. The
    Committee wishes to make clear, however, that this language
    does not permit the Comptroller to engage in definitional
    ``games'' which was the genesis of Section 240 in the first
    place.
        The effect of this provision is to clarify that a State may
    not determine that certain traditional banking products--those
    that are part of the business of banking--are actually
    insurance products. The authority to determine what is
    insurance and what is traditionally banking, subject to this
    clarification, must be exercised in a manner consistent with
    the overall objective of new section 5136A of the revised
    statutes, which is to protect a State's authority to regulate
    insurance. It is clearly not within the scope of a State's
    authority under this Section, or otherwise, to determine that
    other types of traditional banking products, like standby
    letters of credit, swaps and other risk management tools, put
    option bonds, asset-backed securities, loan participations,
    stock indexed CDs, or other similar products, are insurance
    products for purposes of the National Bank Act.
        Insurance is a State regulated business and nothing in this
    legislation is intended to interfere with the functional
    regulation of insurance products. In keeping with that design,
    the Committee would not expect for the Comptroller to define
    any product as the ``business of banking'' which today is
    regulated as insurance by the States. While it may be true that
    some future products may have some insurance features and some
    banking features, the Committee does not expect the Comptroller
    to seek to broaden banking powers without Congressional
    authorization and the Comptroller should not declare any
    current insurance products, regulated as such by the States, to
    be the ``business of banking''.
        In addition, the Committee is aware that commodity futures
    and option contracts are used by national banks to hedge
    against or manage the risk of adverse price changes in various
    physical commodities and financial products and that some of
    these contracts are, in fact, traded by national banks to hedge
    against price movements in homeowners, catastrophe and other
    forms of insurance. In adopting a broad definition of
    ``insurance'' for purposes of national bank activities under
    the legislation, the Committee does not intend to suggest that
    state regulations may permissibly define insurance so as to
    purport to regulate the offer, sale or trading in commodity
    futures and option contracts by national banks which are
    exclusively regulated by the CFTC under the Commodity Exchange
    Act.

     section 241. national bank community development insurance activities

        Section 241 authorizes the Comptroller of the Currency to
    approve an application by a national bank located in an
    empowerment zone to act as an insurance agent or broker.
    However, the bank must provide sufficient evidence that
    competitively priced insurance products are not adequately
    available and that the insurance products are sold only in the
    empowerment zone.
        This new section will provide greater access to insurance
    in disadvantaged communities where competitively priced
    insurance is inadequate. Moreover, this amendment will foster
    economic revitalization, such as new business and employment
    opportunities, in low income neighborhoods by permitting the
    sale of insurance in empowerment zones. Additionally, by
    requiring the sale of insurance to occur from a ``full-service
    branch'' in the empowerment zone, the amendment provides a
    significant incentive for banks to improve the quality and
    quantity of banking services in such communities.
        Effective immediately, this amendment allows national banks
    having main offices or full-service branches in areas eligible
    for designation as empowerment zones or enterprise communities
    under section 1392 of the Internal Revenue Code of 1986, or in
    Indian reservations, to sell insurance from that location. The
    designation criteria for an empowerment zone or enterprise
    community assures that the community is one experiencing
    economic distress.

    section 242. authorizing bank service companies to organize as limited
                             liability partnerships

        Section 242 of this legislation modifies the Bank Service
    Corporation Act by expanding the scope of companies that may be
    owned by banks under the Act to include limited liability
    companies. These companies often combine the elements of both
    corporations and partnerships to provide more flexibility in
    management and in the sharing of profits among its owners than
    do corporations. Furthermore, these companies are taxed as
    partnerships under the Internal Revenue Code.
        Under current law, the Bank Service Corporation Act only
    allows multiple banks to invest in stock-owned corporations.
    These corporations are permitted to perform activities that the
    banks could engage in directly. It enables banks to join
    together to share overhead expenses and to realize the kinds of
    efficiencies of scale that are available to larger banks. By
    permitting institutions to own limited liability companies,
    banks will be granted even greater regulatory relief because of
    the increased flexibility, profit incentive, and tax treatment
    noted above. Restrictions on activities that are imposed on
    corporations under current law and the authority of the federal
    banking agencies to examine and regulate these companies would
    be maintained. Finally, banks would continue to be required to
    obtain prior approval from their primary banking regulator in
    order to invest in these companies.

      section 243. bank investment in edge act and agreement corporations

        Section 25A of the Federal Reserve Act imposes a non-
    waivable limit on a member bank's ability to invest in
    subsidiaries organized under that section (i.e., Edge Act
    subsidiaries) and in subsidiaries held directly under Section
    25 of the Federal Reserve Act (i.e., certain financial service
    corporations held by a member bank's non-U.S. branches). The
    current non-waivable limit of 10% of a member bank's capital
    and surplus was enacted as part of the original Edge Act in
    1919, before U.S. banks or the Federal Reserve Board had
    significant international banking experience. The revision
    would extend the non-waivable limit to 25% of capital and
    surplus providing that the Federal Reserve Board does not find
    the additional amount would be unsafe and unsound. In making
    this determination, the Federal Reserve Board would consider,
    inter alia, the capital and management strength of the member
    bank. The amendment would not otherwise change current law.

       section 244. report on the reconciliation of differences between
      regulatory accounting principles and generally accepted accounting
                                  principles.

        When the FDICIA was enacted in 1991, the Congress noted
    that differences between Regulatory Accounting Principles (RAP)
    and Generally Accepted Accounting Principles (GAAP) created
    significant, unnecessary and costly regulatory reporting and
    control burdens. Accordingly, Section 121 of FDICIA called for
    uniform accounting principles consistent with GAAP (unless the
    appropriate regulator found that a RAP standard was necessary
    to protect safety and soundness, etc.). However, the regulators
    seem to have taken no significant actions toward this goal.
    Therefore, this section requires each appropriate regulator to
    report to both the House Committee on Banking and Financial
    Services and the Senate Committee on Banking, Housing and Urban
    Affairs, within 180 days of enactment, concerning the actions
    taken and to be taken to achieve the goal set by FDICIA. This
    report will set the stage for a meaningful Congressional review
    as an important step toward making sure that there is steady
    but prudent amelioration of this regulatory burden.

    section 245. waivers authorized for residency requirement for national
                                 bank directors

        Section 5136 of the Revised Statutes of the United States
    (12 U.S.C. 72) imposes a residency requirement on directors of
    national banks. In general, current law requires all directors,
    during their whole term of service, to be citizens of the U.S.
    and requires that at least two-thirds of the directors must be
    residents of the State in which the bank is located, subject to
    certain exceptions. Section 245 provides that the Comptroller
    of the Currency may waive the residency requirement.

                          TITLE III--LENDER LIABILITY

                         section 301. lender liability

        Section 301 clarifies the liability under Federal
    environmental law for lenders, fiduciaries, and Federal banking
    and lending agencies by adding section 45 to the Federal
    Deposit Insurance Act. Although the Environmental Protection
    Agency promulgated rules which clarified exemptions for lenders
    and those who act in these capacities, the rule was overturned
    by a court case. Section 301, again, provides certainty as to
    when and to what extent these parties may be liable for
    violations under Federal environmental law for their lending,
    financial and fiduciary activities.
        New section 45(a) provides that a lender is liable when a
    lender actually participates in management of another person's
    environmental activities, regardless of the lender's status as
    a lending institution. A lender is considered under this
    section to be ``actually participating in management'' if a
    lender makes decisions regarding the disposition of hazardous
    substances or exercises control at a management level.
    ``Actually participating in management'' does not include
    traditional lending activities, such as the extension of
    credit, holding a security interest, providing financial
    advice, or undertaking voluntary inspection of property, unless
    these activities rise to the level of participating in the
    operation and management of the property.
        A lender who is held liable pursuant to new section 45(a)
    shall be liable for the cost of any response or corrective
    action to the extent and for the amount that the lender
    actively and directly contributed to the hazardous substance
    release. However, a lender shall not be liable for the cost of
    any response or corrective action for a release of a hazardous
    substance which commences prior to and continues after the
    lender obtains a security interest in the property, so long as
    the lender does not actually participate in the management
    after obtaining a security interest in the property.
        Further, new section 45(b) provides that a fiduciary, while
    acting in a fiduciary capacity, is personally liable for non-
    compliance with Federal environmental law as if the fiduciary
    holds the property free of trust. The fiduciary's liability is
    limited to assets of the trust or estate which are sufficient
    to indemnify the fiduciary. If a fiduciary is liable for
    environmental harm, section 45(b) makes clear that such
    liability does not otherwise override indemnification terms of
    the fiduciary contract of employee benefit plans made pursuant
    to section 3(3) of the Employee Retirement Income Security Act
    of 1974. However, the fiduciary's liability is not limited if
    (1) the fiduciary had preexisting liability, (2) the fiduciary
    fails to exercise due care or contributed to the release of a
    hazardous substance, or (3) the fiduciary established the trust
    for the purpose of avoiding or limiting liability under Federal
    environmental law.
        Lastly, new section 45(e) provides three limitations on
    environmental liability of Federal banking and lending agencies
    and their subsequent purchasers. First, new section 45(e)(1)(A)
    exempts Federal banking and lending agencies, their
    subsidiaries and subsequent purchasers from strict liability
    for the release of a hazardous substance on properties which
    were acquired in connection with (1) receivership,
    conservatorship, or through liquidation, (2) the provision of
    loans, discounts, advances, or other financial assistance, or
    (3) civil or criminal proceeding or administrative enforcement
    action, either by order or settlement under state law. However,
    if the party directly caused or materially contributed to the
    release of a hazardous substance, the party will be held liable
    for any remedial measures to cure the damages. Second, section
    45(e)(1)(B) limits the liability of these entities under State
    law to the value of the entity's interest in the property.
    Third, new section 45(e)(2) makes clear that government
    agencies and their subsequent purchasers are not subject to the
    environmental lien provisions at the time of transfer.
        While new section 45(e) provides the liability limitations
    for Federal banking and lending agencies and their subsequent
    purchasers, it specifically states in new section 45(e)(1)(B)
    that it does not preempt State law. It also does not immunize
    subsequent purchasers from liability if the purchaser (1) had
    preexisting liability to the property or is related to a party
    with such liability, (2) fails to agree to take reasonable
    steps necessary to abate the release or to protect public
    health and safety consistent with Federal environmental laws,
    or (3) directly causes or significantly and materially
    contributes to any additional release or threatened release on
    the property pursuant to new section 45(e)(1)(D)(iv).
    Furthermore, if the subsequent purchaser failed to take
    reasonable steps necessary to abate the release or to protect
    public health and safety under applicable Federal environmental
    laws, then the subsequent purchaser remains liable to the
    appropriate government agency for the costs of such remedial
    action, not exceeding the fair market value of the property,
    according to new section 45(e)(1)(E).
        Section 301(b) provides an effective date to occur upon the
    section's enactment and applies to any claim that has not
    reached final adjudication or settlement prior to enactment.

        TITLE IV--ANNUAL STUDY AND REPORT ON IMPACT ON LENDING TO SMALL
                                    BUSINESS

         SECTION 401. ANNUAL STUDY AND REPORT ON SMALL BUSINESS LENDING

        This section requires an annual study and report by the
    federal banking regulators on the impact this legislation has
    on lending to small businesses.
             Changes in Existing Law Made by the Bill, as Reported

      In compliance with clause 3 of rule XIII of the Rules of the
    House of Representatives, changes in existing law made by the
    bill, as reported, are shown as follows (existing law proposed
    to be omitted is enclosed in black brackets, new matter is
    printed in italic, existing law in which no change is proposed
    is shown in roman):

                 REAL ESTATE SETTLEMENT PROCEDURES ACT OF 1974

              * * * * * * *

                              findings and purpose

        Sec. 2. (a) * * *
        (b) It is the purpose of this Act to effect certain changes
    in the settlement process for residential real estate that will
    result--
              (1) in more effective advance disclosure to home
            buyers and sellers of settlement costs;
              (2) in the elimination of kickbacks or referral fees
            that tend to increase unnecessarily the costs of
            certain settlement services without--
                      (A) directly regulating settlement services
                    prices; or
                      (B) directly regulating wages to bona fide
                    employees that are not designed as a subterfuge
                    to facilitate kickbacks among affiliated
                    companies;
              * * * * * * *

                                  definitions

        Sec. 3. For purposes of this Act--
              (1) the term ``federally related mortgage loan''
            includes any loan (other than temporary financing such
            as a construction loan) which--
                      (A) is secured by a first [or subordinate]
                    lien on residential real property (including
                    individual units of condominiums and
                    cooperatives) designed principally for the
                    occupancy of from one to four families,
                    including any such secured loan, the proceeds
                    of which are used to prepay or pay off an
                    existing loan secured by the same property; and
              * * * * * * *
              (7) the term ``[controlled business arrangement]
            affiliated business arrangement'' means an arrangement
            in which (A) a person who is in a position to refer
            business incident to or a part of a real estate
            settlement service involving a federally related
            mortgage loan, or an associate of such person, has
            either an affiliate relationship with or a direct or
            beneficial ownership interest of more than 1 percent in
            a provider of settlement services; and (B) either of
            such persons directly or indirectly refers such
            business to that provider or affirmately influences the
            selection of that provider; [and]
              (8) the term ``associate'' means one who has one or
            more of the following relationships with a person in a
            position to refer settlement business: (A) a spouse,
            parent, or child of such person; (B) a corporation or
            business entity that controls, is controlled by, or is
            under common control with such person; (C) an employer,
            officer, director, partner, franchisor, or franchisee
            of such person; or (D) anyone who has an agreement,
            arrangement, or understanding, with such person, the
            purpose or substantial effect of which is to enable the
            person in a position to refer settlement business to
            benefit financially from the referrals of such
            business[.]; and
              (9) the term ``Board'' means the Board of Governors
            of the Federal Reserve System.

                          uniform settlement statement

        Sec. 4. (a) The [Secretary] Board, in consultation with the
    Administrator of Veterans' Affairs, the Federal Deposit
    Insurance Corporation, and the [Federal Home Loan Bank Board]
    Director of the Office of Thrift Supervision, shall develop and
    prescribe a standard form for the statement of settlement costs
    which shall be used (with such variations as may be necessary
    to reflect differences in legal and administrative requirements
    or practices in different areas of the country) as the standard
    real estate settlement form in all transactions in the United
    States which involve federally related mortgage loans. Such
    form shall conspicuously and clearly itemize all charges
    imposed upon the borrower and all charges imposed upon the
    seller in connection with the settlement and shall indicate
    whether any title insurance premium included in such charges
    covers or insures the lender's interest in the property, the
    borrower's interest, or both. The [Secretary] Board may, by
    regulation, permit the deletion from the form prescribed under
    this section of items which are not, under local laws or
    customs, applicable in any locality, except that such
    regulation shall require that the numerical code prescribed by
    the [Secretary] Board be retained in forms to be used in all
    localities. Nothing in this section may be construed to require
    that that part of the standard form which relates to the
    borrower's transaction to be furnished to the seller, or to
    require that that part of the standard form which relates to
    the seller be furnished to the borrower.
        (b) The form prescribed under this section shall be
    completed and made available for inspection by the borrower at
    or before settlement by the person conducting the settlement,
    except that (1) the [Secretary] Board may exempt from the
    requirements of this section settlements occurring in
    localities where the final settlement statement is not
    customarily provided at or before the date of settlement, or
    settlements where such requirements are impractical and (2) the
    borrower may, in accordance with regulations of the [Secretary]
    Board, waive his right to have the form made available at such
    time. Upon the request of the borrower to inspect the form
    prescribed under this section during the business day
    immediately preceding the day of settlement, the person who
    will conduct the settlement shall permit the borrower to
    inspect those items which are known to such person during such
    preceding day.

                          special information booklets

        Sec. 5. (a) The [Secretary] Board shall prepare and
    distribute booklets to help persons borrowing money to finance
    the purchase of residential real estate better to understand
    the nature and costs of real estate settlement services. The
    [Secretary] Board shall distribute such booklets to all lenders
    which make federally related mortgage loans.
        (b) Each booklet shall be in such form and detail as the
    [Secretary] Board shall prescribe and, in addition to such
    other information as the [Secretary] Board may provide, shall
    include in clear and concise language--
              (1) a description and explanation of the nature and
            purpose of each cost incident to a real estate
            settlement;
              (2) an explanation and sample of the standard real
            estate settlement form developed and prescribed under
            section 4;
              (3) a description and explanation of the nature and
            purpose of escrow accounts when used in connection with
            loans secured by residential real estate;
              (4) an explanation of the choices available to buyers
            of residential real estate in selecting persons to
            provide necessary services incident to a real estate
            settlement; and
              (5) an explanation of the unfair practices and
            unreasonable or unnecessary charges to be avoided by
            the prospective buyer with respect to a real estate
            settlement.
        (c) Each lender shall include with the booklet a good faith
    estimate of the amount or range of charges for specific
    settlement services the borrower is likely to incur in
    connection with the settlement as prescribed by the [Secretary]
    Board. Such booklets shall take into consideration differences
    in real estate settlement procedures which may exist among the
    several States and territories of the United States and among
    separate political subdivisions within the same State and
    territory.
        (d) Each lender referred to in subsection (a) shall provide
    the booklet described in such subsection to each person from
    whom it receives or for whom it prepares a written application
    to borrow money to finance the purchase of residential real
    estate. Such booklet shall be provided by delivering it or
    placing it in the mail not later than 3 business days after the
    lender receives the application, but no booklet need be
    provided if the lender denies the application for credit before
    the end of the 3-day period.
        (e) Booklets may be printed and distributed by lenders if
    their form and content are approved by the [Secretary] Board as
    meeting the requirements of subsection (b) of this section.

       servicing of mortgage loans and administration of escrow accounts

      Sec. 6. [(a) Disclosure to Applicant Relating to Assignment,
    Sale, or Transfer of Loan Servicing.--
              [(1) In general.--Each person who makes a federally
            related mortgage loan shall disclose to each person who
            applies for any such loan, at the time of application
            for the loan--
                      [(A) whether the servicing of any such loan
                    may be assigned, sold, or transferred to any
                    other person at any time while such loan is
                    outstanding;
                      [(B) at the choice of the person making a
                    federally related mortgage loan--
                              [(i) for each of the most recent 3
                            calendar years completed (at the time
                            of such application), the percentage
                            (rounded to the nearest quartile) of
                            loans made by such person for which the
                            servicing has been assigned, sold, or
                            transferred as of the end of the most
                            recent calendar year completed, except
                            that--
                                      [(I) for any loan application
                                    during the 12-month period
                                    beginning on the date of the
                                    enactment of the Cranston-
                                    Gonzalez National Affordable
                                    Housing Act, the information
                                    disclosed under this
                                    subparagraph may be for only
                                    the most recent calendar year
                                    completed, and for any loan
                                    application during the 12-month
                                    period beginning 1 year after
                                    the date of the enactment of
                                    the Cranston-Gonzalez National
                                    Affordable Housing Act, the
                                    information disclosed under
                                    this subparagraph may be for
                                    the most recent 2 calendar
                                    years completed; and
                                      [(II) this subparagraph may
                                    not be construed to require the
                                    inclusion, in the percentage
                                    disclosed, of any loans the
                                    servicing of which has been
                                    assigned, sold, or transferred
                                    by the person making the loan
                                    to a transferee servicer that
                                    is an affiliate or subsidiary
                                    of such person; or
                              [(ii) a statement that the person
                            making the loan has previously
                            assigned, sold, or transferred the
                            servicing of federally related mortgage
                            loans; and
                      [(C) if the person who makes the loan does
                    not engage in the servicing of any federally
                    related mortgage loans, that there is a present
                    intent on the part of such person (at the time
                    of such application) to assign, sell, or
                    transfer the servicing of such loan to another
                    person.
              [(2) Model disclosure statements.--Not later than 90
            days after the date of the enactment of the Cranston-
            Gonzalez National Affordable Housing Act, the Secretary
            shall develop a model disclosure statement for
            notification to applicants under paragraph (1) with
            respect to servicing procedures, transfer practices and
            requirements, and complaint resolution. The model
            statement shall provide for the person originating the
            loan to disclose their capacity to service loans and
            the best available estimate of the percentage of all
            loans made by such person for which the servicing will
            be assigned, sold, or transferred during the 12-month
            period beginning upon the origination. The estimate
            shall be expressed as one of the following range of
            possibilities--between 0 and 25 percent, between 26 and
            50 percent, between 51 and 75 percent, or between 76
            and 100 percent. This paragraph may not be construed to
            require the inclusion, in the estimate disclosed, of
            any loans the servicing of which will be assigned,
            sold, or transferred by the person originating the loan
            to a transferee servicer that is an affiliate or
            subsidiary of such person.
              [(3) Signature of applicant.--Any disclosure of the
            information required under paragraph (1) shall not be
            effective for purposes of this section unless the
            disclosure is accompanied by a written statement, in
            such form as the Secretary shall develop before the
            expiration of the 90-day period beginning on the date
            of the enactment of the Cranston-Gonzalez National
            Affordable Housing Act, that the applicant has read and
            understood the disclosure  and  that  is  evidenced  by
             the  signature  of  the applicant at the place where
            such statement appears in the application.]
      (a) Disclosure to Applicant Relating to Assignment, Sale, or
    Transfer of Loan Servicing.--
              (1) In general.--Each person who makes a federally
            related mortgage loan shall disclose to each person who
            applies for any such loan, at the time of application
            for the loan, whether the servicing of any such loan
            may be assigned, sold, or transferred to any other
            person at any time while such loan is outstanding.
              (2) Signature of applicant.--Any disclosure of the
            information required under paragraph (1) shall not be
            effective for purposes of this section unless the
            disclosure is accompanied by a written statement, in
            such form as the Secretary shall develop before the
            expiration of the 180-day period beginning on the date
            of the enactment of the Financial Institutions
            Regulatory Relief Act of 1995, that the applicant has
            read and understood the disclosure and that is
            evidenced by the signature of the applicant at the
            place where such statement appears in the application.
              * * * * * * *
          (j) Transition.--
              (1) * * *
              * * * * * * *
              (3) Regulations and effective date.--The [Secretary]
            Board shall, by regulations that shall take effect not
            later than April 20, 1991, establish any requirements
            necessary to carry out this section. Such regulations
            shall include the model disclosure statement required
            under subsection (a)(2).

    SEC. 7. EXEMPTED TRANSACTIONS.

      (a) In General.--This Act does not apply to credit
    transactions involving extensions of credit--
              (1) primarily for business, commercial, or
            agricultural purposes; or
              (2) to government or governmental agencies or
            instrumentalities.
      (b) Interpretation.--In issuing regulations pursuant to
    section 19(a) of this Act, the Board shall ensure that, with
    regard to subsection (a), the exemption for business credit
    includes all business credit which is exempt from the Truth in
    Lending Act in accordance with section 226.3(a) of the
    regulations prescribed by the Board known as ``regulation Z''
    (12 C.F.R. 226.3(a)), as in effect on the date of enactment of
    the Financial Institutions Regulatory Relief Act of 1995.
                prohibition against kickbacks and unearned fees

          Sec. 8. (a) * * *
              * * * * * * *
        (c) Nothing in this section shall be construed as
    prohibiting (1) the payment of a fee (A) to attorneys at law
    for services actually rendered or (B) by a title company to its
    duly appointed agent for services actually performed in the
    issuance of a policy of title insurance or (C) by a lender to
    its duly appointed agent for services actually performed in the
    making of a loan, (2) the payment to any person of a bona fide
    salary or compensation or other payment for goods or facilities
    actually furnished or for services actually performed, (3)
    payments pursuant to cooperative brokerage and referral
    arrangements or agreements between real estate agents and
    brokers, (4) [controlled business arrangements] affiliated
    business arrangements so long as (A) at or prior to the time of
    the referral a disclosure is made of the existence of such an
    arrangement to the person being referred and, in connection
    with the referral, such person is provided a written estimate
    of the charge or range of charges generally made by the
    provider to which the person is referred, except that where a
    lender makes the referral, this requirement may be satisfied as
    part of and at the time that the estimates of settlement
    charges required under section 5(c) are provided, (B) such
    person is not required to use any particular provider of
    settlement services, and (C) the only thing of value that is
    received from the arrangement, other than the payments
    permitted under this subsection, is a return on the ownership
    interest or franchise relationship, or (5) such other payments
    or classes of payments or other transfers as are specified in
    regulations prescribed by the Secretary, after consultation
    with the Attorney General, the Secretary of Veterans Affairs,
    the Federal Home Loan Bank Board, the Federal Deposit Insurance
    Corporation, the Board of Governors of the Federal Reserve
    System, and the Secretary of Agriculture. For purposes of the
    preceding sentence, the following shall not be considered a
    violation of clause (4)(B): (i) any arrangement that requires a
    buyer, borrower, or seller to pay for the services of an
    attorney, credit reporting agency, or real estate appraiser
    chosen by the lender to represent the lender's interest in a
    real estate transaction, or (ii) any arrangement where an
    attorney or law firm represents a client in a real estate
    transaction issues or arranges for the issuance of a policy of
    title insurance in the transaction directly as agent or through
    a separate corporate title insurance agency that may be
    established by that attorney or law firm and operated as an
    adjunct to his or its law practice.
        (d)(1) Any person or persons who willfully violate the
    provisions of this section shall be fined not more than $10,000
    or imprisoned for not more than one year, or both.
              * * * * * * *
        (3) No person or persons shall be liable for a violation of
    the provisions of section (8)(c)(4)(A) if such person or
    persons proves by a preponderance of the evidence that such
    violation [was not intentional and] resulted from a bona fide
    error notwithstanding maintenance of procedures that are
    reasonably adapted to avoid such error.
        (4) The Secretary, any other agency described in subsection
    (f)(1), the Attorney General of any State, or the insurance
    commissioner of any State may bring an action to enjoin
    violations of this section.
              * * * * * * *
        (6) No provision of State law or regulation that imposes
    more stringent limitations on [controlled business
    arrangements] affiliated business arrangements shall be
    construed as being inconsistent with this section.
              * * * * * * *
      (e) Negotiated Regulations.--
              (1) In general.--The Secretary may not publish a
            proposed or final regulation under this section and
            section 9 after the date of the enactment of the
            Financial Institutions Regulatory Relief Act of 1995
            unless the Secretary has used the negotiated rulemaking
            procedure established under subchapter III of chapter 5
            of title 5, United States Code, to attempt to negotiate
            and develop the rule.
              (2) Consistency with purpose.--Any regulation
            prescribed in accordance with paragraph (1) shall be
            consistent with the purposes of this title as set forth
            in section 2.
      (f) Administrative Enforcement.--
              (1) In general.--Compliance with the requirements of
            this section and sections 9 and 12 shall be enforced
            under this Act--
                      (A) in the case of an insured depository
                    institution (as defined in section 3 of the
                    Federal Deposit Insurance Act), by the
                    appropriate Federal banking agency (as defined
                    in such section);
                      (B) in the case of an insured credit union
                    (as defined in section 101(7) of the Federal
                    Credit Union Act), by the National Credit Union
                    Administration;
                      (C) in the case of a bank holding company (as
                    defined in section 2 of the Bank Holding
                    Company Act of 1956) and any affiliate of any
                    such holding company (other than an insured
                    depository institution), by the Board;
                      (D) in the case of a savings and loan holding
                    company (as defined in section 10 of the Home
                    Owners' Loan Act) and any affiliate of any such
                    holding company (other than an insured
                    depository institution), by the Director of the
                    Office of Thrift Supervision; and
                      (E) in the case of any other person, by the
                    Secretary.
              (2) Special rules relating to determination of
            appropriate regulator.--
                      (A) Cases of more than 1 appropriate
                    regulator.--If, under paragraph (1), a company
                    may be regulated by more than 1 agency, the
                    Board shall determine which agency shall be the
                    responsible agency, notwithstanding paragraph
                    (1).
                      (B) Cases involving joint ventures,
                    partnerships, and other affiliated business
                    arrangements.--If any insured depository
                    institution is involved in a joint venture,
                    partnership, or other affiliated business
                    arrangement with any person who is not an
                    insured depository institution, the agency
                    responsible for enforcing this section and
                    sections 9 and 12 with respect to such insured
                    depository institution shall be the agency with
                    such responsibility with respect to such joint
                    venture, partnership, or other affiliated
                    business arrangement.
              (3) Interagency cooperation and enforcement
            guidelines.--All the agencies referred to in any
            subparagraph of paragraph (1) shall cooperate with each
            other to develop enforcement guidelines and other means
            for achieving effective compliance with this section
            and sections 9 and 12.
              (4) Preference for civil enforcement over criminal
            enforcement.--As part of the cooperative efforts
            required under paragraph (3), the agencies referred to
            in paragraph (1) shall consider means for achieving
            compliance with this section and section 9 through the
            exercise of administrative enforcement authority under
            this subsection without resorting to criminal
            enforcement actions under subsection (d) except in
            appropriate cases.
              (5) Effective date.--Paragraphs (1) and (2) shall not
            take effect until joint interagency cooperation and
            enforcement guidelines are adopted by all the agencies
            to which paragraphs (1) and (2) apply and the
            enforcement authority of the Secretary with respect to
            this section and sections 9 and 12 shall continue until
            such paragraphs take effect.
              * * * * * * *

                                escrow accounts

        Sec. 10. (a) * * *
              * * * * * * *
        (c) Escrow Account Statements.--
              (1) Initial statement.--
                      (A) * * *
              * * * * * * *
                      (C) Initial statement at closing.--Any
                    servicer may submit the statement required
                    under subparagraph (A) to the borrower at
                    closing and may incorporate such statement in
                    the uniform settlement statement required under
                    section 4. [Not later than the expiration of
                    the 90-day period beginning on the date of the
                    enactment of the Cranston-Gonzalez National
                    Affordable Housing Act, the] The Secretary
                    shall issue regulations prescribing any changes
                    necessary to the uniform settlement statement
                    under section 4 that specify how the statement
                    required under subparagraph (A) of this section
                    shall be incorporated in the uniform settlement
                    statement.
              * * * * * * *
        (d) Penalties.--
              (1) In general.--In the case of each failure to
            submit a statement to a borrower as required under
            subsection (c), the [Secretary] Board shall assess to
            the lender or escrow servicer failing to submit the
            statement a civil penalty of $50 for each such failure,
            but the total amount imposed on such lender or escrow
            servicer for all such failures during any 12-month
            period referred to in subsection (b) may not exceed
            $100,000.
              * * * * * * *

    [establishment on demonstration basis of land parcel recordation system

        [Sec. 13. The Secretary shall establish and place in
    operation on a demonstration basis, in representative political
    subdivisions (selected by him) in various areas of the United
    States, a model system or systems for the recordation of land
    title information in a manner and form calculated to facilitate
    and simplify land transfers and mortgage transactions and
    reduce the cost thereof, with a view to the possible
    development (utilizing the information and experience gained
    under this section) of a nationally uniform system of land
    parcel recordation.

     [report of the secretary on necessity for further congressional action

        [Sec. 14. (a) The Secretary, after consultation with the
    Administrator of Veterans' Affairs, the Federal Deposit
    Insurance Corporation, and the Federal Home Loan Bank Board,
    and after such study, investigation, and hearings (at which
    representatives of consumers' groups shall be allowed to
    testify) as he deems appropriate, shall, not less than three
    years nor more than five years from the effective date of this
    Act, report to the Congress on whether, in view of the
    implementation of the provisions of this Act imposing certain
    requirements and prohibiting certain practices in connection
    with real estate settlements, there is any necessity for
    further legislation in this area.
        [(b) If the Secretary concludes that there is necessity for
    futher legislation, he shall report to the Congress on the
    specific practices or problems that should be the subject of
    such legislation and the corrective measures that need to be
    taken. In addition, the Secretary shall include in his report--
              [(1) recommendations on the desirability of requiring
            lenders of federally related mortgage loans to bear the
            costs of particular real estate settlement services
            that would otherwise be paid for by borrowers;
              [(2) recommendations on whether Federal regulation of
            the charges for real estate settlement services in
            federally related mortgage transactions is necessary
            and desirable, and, if he concludes that such
            regulation is necessary and desirable, a description
            and analysis of the regulatory scheme he believes
            Congress should adopt; and
              [(3) recommendations on the ways in which the Federal
            Government can assist and encourage local governments
            to modernize their methods for the recordation of land
            title information, including the feasibility of
            providing financial assistance or incentives to local
            governments that seek to adopt one of the model systems
            developed by the Secretary in accordance with the
            provisons of section 13 of this Act.

     [demonstration to determine feasibility of including state- ments of
                settlement costs in special information booklets

        [Sec. 15. The Secretary shall, on a demonstration basis in
    selected housing market areas, have prepared and included in
    the special information booklets required to be furnished under
    section 5 of this Act, statements of the range of costs for
    specific settlement services in such areas. Not later than June
    30, 1976, the Secretary shall transmit to the Congress a full
    report on the demonstration conducted under this section. Such
    report shall contain the Secretary's assessment of the
    feasibility of preparing and including settlement cost range
    statements for all housing market areas in the special
    information booklets for such areas.]

                             jurisdiction of courts

        Sec. 16. Any action pursuant to the provisions of section 8
    or 9 may be brought in the United States district court or in
    any other court of competent jurisdiction, for the district in
    which the property involved is located, or where the violation
    is alleged to have occurred, within one year from the date of
    the occurrence of the violation, except that actions brought by
    the [Secretary,] Board, an agency referred to in any
    subparagraph of section 8(f)(1), the Attorney General of any
    State, or the insurance commissioner of any State may be
    brought within 3 years from the date of the occurrence of the
    violation.
              * * * * * * *

                             relation to state laws

        Sec. 18. This Act does not annul, alter, or affect, or
    exempt any person subject to the provisions of this Act from
    complying with, the laws of any State with respect to
    settlement practices, except to the extent that those laws are
    inconsistent with any provision of this Act, and then only to
    the extent of the inconsistency. The [Secretary is authorized
    to] Board and Secretary may jointly determine whether such
    inconsistencies exist. The Board and Secretary may not
    determine that any State law is inconsistent with any provision
    of this Act if the Board and Secretary [determines] determine
    that such laws gives greater protection to the consumer. In
    making these determinations the Board and Secretary shall
    consult with the appropriate Federal agencies.

                          [authority of the secretary]
            authority of the secretary and the federal reserve board
        Sec. 19. [(a) The Secretary is authorized to prescribe such
    rules and regulations, to make such interpretations, and to
    grant such reasonable exemptions for classes of transactions,
    as may be necessary to achieve the purposes of this Act.] (a)
    Regulations.--
              (1) In general.--Subject to paragraph (2), the
            Secretary and the Board may prescribe such regulations,
            make such interpretations, and grant such reasonable
            exemptions for classes of transactions, as may be
            necessary to achieve the purposes of this Act.
              (2) Application.--
                      (A) Board.--The authority of the Board under
                    paragraph (1) shall apply with respect to--
                              (i) sections 4, 5, 6, 10, and 12; and
                              (ii) sections 3, 7, 17, and 18 to the
                            extent such sections are applicable
                            with respect to the sections described
                            in clause (i).
                      (B) Secretary.--The authority of the
                    Secretary under paragraph (1) shall apply with
                    respect to--
                              (i) sections 8 and 9; and
                              (ii) sections 3, 7, 17, and 18 to the
                            extent such sections are applicable
                            with respect to the sections described
                            in clause (i).
        (b) No provision of this Act or the laws of any State
    imposing any liability shall apply to any act done or omitted
    in good faith in conformity with any rule, regulation, or
    interpretation thereof by the Secretary, the Board, or the
    Attorney General, notwithstanding that after such act or
    omission has occurred, such rule, regulation, or interpretation
    is amended, rescinded, or determined by judicial or other
    authority to be invalid for any reason.
        (c)(1) The [Secretary] Board, with respect to any action to
    enforce section 4, 5, 6, or 10, and each agency referred to in
    any subparagraph of section 8(f)(1), with respect to any action
    to enforce section 8, 9, or 12, may investigate any facts,
    conditions, practices, or matters that may be deemed necessary
    or proper to aid in the enforcement of the provisions of this
    Act, in prescribing of rules and regulations thereunder, or in
    securing information to serve as a basis for recommending
    further legislation concerning real estate settlement
    practices. To aid in the investigations, the [Secretary] Board
    or such other agency is authorized to hold such hearings,
    administer such oaths, and require by subpena the attendance
    and testimony of such witnesses and production of such
    documents as the [Secretary] Board or such other agency deems
    advisable.
        (2) Any district court of the United States within the
    jurisdiction of which an inquiry is carried on may, in the case
    of contumacy or refusal to obey a subpena of the [Secretary]
    Board or an agency referred to in any subparagraph of section
    8(f)(1) issued under this section, issue an order requiring
    compliance therewith; and any failure to obey such order of the
    court may be punished by such court as a contempt thereof.
              * * * * * * *
                                  ----------

                              TRUTH IN LENDING ACT

                         TITLE I--CONSUMER CREDIT COST

              * * * * * * *
                         CHAPTER 1--GENERAL PROVISIONS

              * * * * * * *

    Sec. 101. Short title

      This title may be cited as the Truth in Lending Act.
              * * * * * * *

    Sec. 103. Definitions and rules of construction

      (a) * * *
              * * * * * * *
      (aa)(1) A mortgage referred to in this subsection means a
    consumer credit transaction that is secured by a subordinate
    mortgage on the consumer's principal dwelling, other than [a
    residential mortgage transaction], a reverse mortgage
    transaction, or a transaction under an open end credit plan,
    if--
              (A) * * *
              * * * * * * *

    Sec. 104. Exempted transactions

      This title does not apply to the following:
              (1) * * *
              * * * * * * *
              (7) Transactions for which the Board, by regulation,
            determines that coverage under the Act is not needed to
            carry out the purposes of the Act.

    Sec. 105. Regulations

      (a) * * *
      (b) Exemptive Authority.--
              (1) In general.--The Board shall exempt from all or
            parts of this title any class of transactions for
            which, in the Board's judgment, coverage under all or
            part of this title does not provide a measurable
            benefit to consumers in the form of useful information
            or protection.
              (2) Factors to be considered.--In determining which
            classes of transactions to exempt in whole or in part,
            the Board shall consider, among other factors, the
            following:
                      (A) The amount of the loan or closing costs
                    and whether the disclosures, right of
                    rescission, and other provisions are necessary,
                    particularly for small loans.
                      (B) Whether the requirements of this title
                    complicate, hinder, or make more expensive the
                    credit process for the class of transactions.
                      (C) The status of the borrower, including,
                    the borrowers' related financial arrangements,
                    the financial sophistication of the borrower
                    relative to the type of transaction, and the
                    importance of the credit and related supporting
                    property to the borrower.
      [(b)] (c) The Board shall publish model disclosure forms and
    clauses for common transactions to facilitate compliance with
    the disclosure requirements of this title and to aid the
    borrower or lessee in understanding the transaction by
    utilizing readily understandable language to simplify the
    technical nature of the disclosures. In devising such forms,
    the Board shall consider the use by creditors or lessors of
    data processing or similar automated equipment. Nothing in this
    title may be construed to require a creditor or lessor to use
    any such model form or clause prescribed by the Board under
    this section. A creditor or lessor shall be deemed to be in
    compliance with the disclosure provisions of this title with
    respect to other than numerical disclosures if the creditor or
    lessor (1) uses any appropriate model form or clause as
    published by the Board, or (2) uses any such model form or
    clause and changes it by (A) deleting any information which is
    not required by this title, or (B) rearranging the format, if
    in making such deletion or rearranging the format, the creditor
    or lessor does not affect the substance, clarity, or meaningful
    sequence of the disclosure.
      [(c)] (d) Model disclosure forms and clauses shall be adopted
    by the Board after notice duly given in the Federal Register
    and an opportunity for public comment in accordance with
    section 553 of title 5, United States Code.
      [(d)] (e) Any regulation of the Board, or any amendment or
    interpretation thereof, requiring any disclosure which differs
    from the disclosures previously required by this chapter,
    chapter 4, or chapter 5, or by any regulation of the Board
    promulgated thereunder shall have an effective date of that
    October 1 which follows by at least six months the date of
    promulgation, except that the Board may at its discretion take
    interim action by regulation, amendment, or interpretation to
    lengthen the period of time permitted for creditors or lessors
    to adjust their forms to accommodate new requirements or
    shorten the length of time for creditors or lessors to make
    such adjustments when it makes a specific finding that such
    action is necessary to comply with the findings of a court or
    to prevent unfair or deceptive disclosure practices.
    Notwithstanding the previous sentence, any creditor or lessor
    may comply with any such newly promulgated disclosure
    requirements prior to the effective date of the requirements.

    Sec. 106. Determination of finance charge

      (a) Except as otherwise provided in this section, the amount
    of the finance charge in connection with any consumer credit
    transaction shall be determined as the sum of all charges,
    payable directly or indirectly by the person to whom the credit
    is extended, and imposed directly or indirectly by the creditor
    as an incident to the extension of credit. The finance charge
    does not include charges of a type payable in a comparable cash
    transaction. The finance charge shall not include fees and
    amounts imposed by third party closing agents (including
    settlement agents, attorneys, and escrow and title companies)
    if the creditor does not expressly require the imposition of
    the charges or the services provided and does not retain the
    charges. Examples of charges which are included in the finance
    charge include any of the following types of charges which are
    applicable.
              (1) Interest, time price differential, and any amount
            payable under a point, discount, or other system of
            additional charges.
              (2) Service or carrying charge.
              (3) Loan fee, finder's fee, or similar charge.
              (4) Fee for an investigation or credit report.
              (5) Premium or other charge for any guarantee or
            insurance protecting the creditor against the obligor's
            default or other credit loss.
              (6) Mortgage broker fees.
              * * * * * * *
      [(c) Charges or premiums for insurance, written in connection
    with any consumer credit transaction, against loss of or damage
    to property or against liability arising out of the ownership
    or use of property, shall be included in the finance charge
    unless a clear and specific statement in writing is furnished
    by the creditor to the person to whom the credit is extended,
    setting forth the cost of the insurance if obtained from or
    through the creditor, and stating that the person to whom the
    credit is extended may choose the person through which the
    insurance is to be obtained.]
      (c) Treatment of Certain Debt Cancellation and Deficiency
    Waiver Contracts.--Charges or premiums for any insurance or for
    any voluntary noninsurance product, written in connection with
    any consumer credit transaction, that provides protections
    against loss of or damage to property or against part or all of
    the debtor's liability for amounts in excess of the value of
    the collateral securing the debtor's obligation, or against
    liability arising out of the ownership or use of property,
    shall be included in the finance charge unless a clear and
    specific statement in writing is furnished by the creditor to
    the person to whom the credit is extended, setting forth the
    cost of the insurance or product if obtained from or through
    the creditor, and stating that the person to whom credit is
    extended may choose the person through which the insurance or
    product is to be obtained.
      (d) If any of the following items is itemized and disclosed
    in accordance with the regulations of the Board in connection
    with any transaction, then the creditor need not include that
    item in the computation of the finance charge with respect to
    that transaction:
              (1) * * *
              * * * * * * *
              (3) Any tax levied on security instruments or on
            documents evidencing indebtedness if the payment of
            such taxes is a precondition for recording the
            instrument securing the evidence of indebtedness.
      (e) The following items, when charged in connection with any
    extension of credit secured by an interest in real property,
    shall not be included in the computation of the finance charge
    with respect to that transaction:
              (1) * * *
              [(2) Fees for preparation of a deed, settlement
            statement, or other documents.]
              (2) Fees for preparation of loan-related documents
            and for attending or conducting settlement.
              (3) Escrows for future payments of taxes and
            insurance.
              (4) Fees for notarizing deeds and other documents.
              (5) Appraisal fees, including fees related to pest
            infestations, premises and structural inspections, and
            flood hazards.
              (6) Credit reports.
      (f) Tolerances for Accuracy.--In connection with credit
    transactions not under an open end credit plan that are secured
    by real property or a dwelling, the disclosure of the finance
    charge and other disclosures affected by any finance charge--
              (1) except as provided in paragraph (2), shall be
            treated as being accurate for purposes of this title if
            the amount disclosed as the finance charge--
                      (A) does not vary from the actual finance
                    charge by more than an amount equal to \1/2\ of
                    the numerical tolerance corresponding to, and
                    generated by, the tolerance provided by section
                    107(c) with respect to the annual percentage
                    rate, but in no case may the tolerance under
                    this paragraph be less than $25 or greater than
                    $200; or
                      (B) is greater than the amount required to be
                    disclosed under this title; and
              (2) shall be treated as being accurate for purposes
            of section 125 if the amount disclosed as the finance
            charge does not vary from the actual finance charge by
            more than an amount equal to 0.5 percent of the total
            amount of credit extended.
              * * * * * * *

    Sec. 108. Administrative enforcement

      (a) * * *
              * * * * * * *
      (e)(1) * * *
              * * * * * * *
      (3) Notwithstanding paragraph (2), no adjustment shall be
    ordered (A) if it would have a significantly adverse impact
    upon the safety or soundness of the creditor, but [in any such
    case, the agency may require] in any such case, the agency may
    (i) require a partial adjustment in an amount which does not
    have such an impact[, except that with respect to any
    transaction consummated after the effective date of section 608
    of the Truth in Lending Simplification and Reform Act, the
    agency shall]; or (ii) require the full adjustment, but permit
    the creditor to make the required adjustment in partial
    payments over an extended period of time which the agency
    considers to be [reasonable,] reasonable if, in the case of an
    agency referred to in paragraph (1), (2), or (3) of subsection
    (a), the agency determines that a partial adjustment or the
    making of partial payments over an extended period is necessary
    to avoid causing the creditor to become undercapitalized (as
    determined in accordance with regulations prescribed by such
    agency under section 38 of the Federal Deposit Insurance Act);
    (B) if the amount of the adjustment would be less than $1,
    except that if more than one year has elapsed since the date of
    the violation, the agency may require that such amount be paid
    into the Treasury of the United States, or (C) except where
    such disclosure error resulted from a willful violation which
    was intended to mislead the person to whom credit was extended,
    in the case of an open-end credit plan, more than two years
    after the violation, or in the case of any other extension of
    credit, as follows:
              (i) * * *
              * * * * * * *

                         CHAPTER 2--CREDIT TRANSACTIONS
    Sec.
    121. General requirement of disclosure.
    122. Form of disclosure; additional information.
         * * * * * * *
    139. Certain limitations on liability.
    Sec. 121. General requirement of disclosure

      (a) * * *
              * * * * * * *
      (c) The Board may provide by regulation that any portion of
    the information required to be disclosed by this title may be
    given in the form of estimates where the provider of such
    information is not in a position to know exact information. In
    the case of any consumer credit transaction a portion of the
    interest on which is determined on a per diem basis and is to
    be collected upon the consummation of such transaction, any
    disclosure with respect to such portion of interest shall be
    deemed to be accurate for purposes of this title if the
    disclosure is based on information actually known to the
    creditor at the time that the disclosure documents are being
    prepared for the consummation of the transaction.
              * * * * * * *

    Sec. 125. Right of rescission as to certain transactions

      (a) * * *
      (b) When an obligor exercises his right to rescind under
    subsection (a), he is not liable for any finance or other
    charge, except any charge for an appraisal report or credit
    report, and any security interest given by the obligor,
    including any such interest arising by operation of law,
    becomes void upon such a rescission. Within 20 days after
    receipt of a notice of rescission, the creditor shall return to
    the obligor any money or property given as earnest money,
    downpayment, or [otherwise] as otherwise required under this
    subsection, and shall take any action necessary or appropriate
    to reflect the termination of any security interest created
    under the transaction. If the creditor has delivered any
    property to the obligor, the obligor may retain possession of
    it. Upon the performance of the creditor's obligations under
    this section, the obligor shall tender the property to the
    creditor, except that if return of the property in kind would
    be impracticable or inequitable, the obligor shall tender its
    reasonable value. Tender shall be made at the location of the
    property or at the residence of the obligor, at the option of
    the obligor. If the creditor does not take possession of the
    property within 20 days after tender by the obligor, ownership
    of the property vests in the obligor without obligation on his
    part to pay for it. The procedures prescribed by this
    subsection shall apply except when otherwise ordered by a
    court.
              * * * * * * *
      (e) This section does not apply to--
              (1) a residential mortgage transaction as defined in
            section 103(w);
              (2) a transaction which constitutes a refinancing or
            consolidation (with no new advances), other than a
            transaction described in subsection (e)(5), of the
            principal balance then due and any accrued and unpaid
            finance charges of an existing extension of credit by
            the same creditor secured by an interest in the same
            property;
              (3) a transaction in which an agency of a State is
            the creditor; [or]
              (4) advances under a preexisting open end credit plan
            if a security interest has already been retained or
            acquired and such advances are in accordance with a
            previously established credit limit for such plan[.];
            or
              (5) a transaction, other than a mortgage referred to
            in section 103(aa), which--
                      (A) is a refinancing of the principal balance
                    then due and any accrued and unpaid finance
                    charges of a residential mortgage transaction
                    as defined in section 103(w), or is any
                    subsequent refinancing of such a transaction;
                    and
                      (B) does not provide any new consolidation or
                    new advance.
              * * * * * * *
      (h) Limitation on Rescission.--An obligor shall have no
    rescission rights arising from the form of written notice used
    by the creditor to inform the obligor of the rights of the
    obligor under this section, if the creditor provided the
    obligor the appropriate form of written notice published and
    adopted by the Board, or a comparable written notice of the
    rights of the obligor, that was properly completed by the
    creditor.
      (i) Rescission Rights in Foreclosure.--
              (1) In general.--Notwithstanding section 139, and
            subject to the time period provided in subsection (f),
            in addition to any other right of rescission available
            under this section for a transaction, upon an action of
            a creditor to execute foreclosure on the primary
            dwelling of an obligor securing an extension of credit,
            the obligor shall have a right to rescind the
            transaction equivalent to other rescission rights
            provided by this section, if--
                      (A) a mortgage brokers fee is not included in
                    the finance charge in accordance with the laws
                    and regulations in effect at the time the
                    consumer credit transaction was consummated; or
                      (B) the form of notice of rescission for the
                    transaction is not the appropriate form of
                    written notice published and adopted by the
                    Board or a comparable written notice, or was
                    not properly completed by the creditor.
              (2) Tolerance for disclosures.--Notwithstanding
            section 106(f), and subject to the time period provided
            in subsection (f), for the purposes of exercising any
            rescission rights following an action by a creditor to
            foreclose on the principal dwelling of the obligor
            securing an extension of credit, the disclosure of the
            finance charge and other disclosures affected by any
            finance charge shall be treated as being accurate for
            purposes of this section if the amount disclosed as the
            finance charge does not vary from the actual finance
            charge by more than $35 or is greater than the amount
            required to be disclosed under this title.
              * * * * * * *

    SEC. 127A.  DISCLOSURE REQUIREMENTS FOR OPEN END CONSUMER CREDIT PLANS
                        SECURED BY THE CONSUMER'S PRINCIPAL DWELLING.

      (a) Application Disclosures.--In the case of any open end
    consumer credit plan which provides for any extension of credit
    which is secured by the consumer's principal dwelling, the
    creditor shall make the following disclosures in accordance
    with subsection (b):
              (1) Fixed annual percentage rate.--Each annual
            percentage rate imposed in connection with extensions
            of credit under the plan and a statement that such rate
            does not include costs other than interest.
              (2) Variable percentage rate.--In the case of a plan
            which provides for variable rates of interest on credit
            extended under the plan--
                      (A) * * *
              * * * * * * *
                      (G) subject to subsection (b)(3), a table,
                    based on a $10,000 extension of credit, showing
                    how the annual percentage rate and the minimum
                    periodic payment amount under each repayment
                    option of the plan would have been affected
                    during the preceding 15-year period by changes
                    in any index used to compute such rate, or a
                    statement that the monthly payment may increase
                    or decrease significantly due to increases in
                    the annual percentage rate;
              * * * * * * *
      (b) Time and Form of Disclosures.--
              (1) * * *
              * * * * * * *
              (3) Requirement for historical table.--In preparing
            the table [required under] referred to in subsection
            (a)(2)(G), the creditor shall consistently select one
            rate of interest for each year and the manner of
            selecting the rate from year to year shall be
            consistent with the plan.
              * * * * * * *

    Sec. 128. Consumer credit not under open end credit plans

      (a) For each consumer credit transaction other than under an
    open end credit plan, the creditor shall disclose each of the
    following items, to the extent applicable:
              (1) * * *
              * * * * * * *
              (14) In any variable rate transaction secured by the
            consumer's principal dwelling with a term greater than
            1 year, at the creditors' option, a statement that the
            monthly payment may increase or decrease substantially,
            or a historical example illustrating the effects of
            interest rate changes implemented according to the loan
            program.
      (b)(1) * * *
              * * * * * * *
      (3) In the case of a residential mortgage transaction, the
    disclosures under subsection (a) shall include the following:
              (A) The note rate and points, and a statement, if
            applicable, that these terms are subject to change.
              (B) A statement that the creditor must include the
            disclosed note rate and points in the credit agreement
            unless, in relation to either or both of those terms--
                      (i) the disclosure clearly and conspicuously
                    indicates that the term is subject to change,
                    or
                      (ii) in the case of any term to which clause
                    (i) does not apply--
                              (I) the creditor has clearly and
                            conspicuously indicated that the term
                            is conditioned on closing the
                            transaction within a prescribed time;
                              (II) the creditor has promptly and
                            clearly communicated to the consumer
                            the information and documentation that
                            the consumer is required to provide to
                            the creditor; and
                              (III) the consumer has failed to
                            provide such information and
                            documentation within a reasonable time
                            after receiving that communication.
              * * * * * * *

    Sec. 130. Civil liability

      (a) Except as otherwise provided in this section, any
    creditor who fails to comply with any requirement imposed under
    this chapter, including any requirement under section 125, or
    chapter 4 or 5 of this title with respect to any person is
    liable to such person in an amount equal to the sum of--
              (1) any actual damage sustained by such person as a
            result of the failure;
              (2)(A)(i) in the case of an individual action twice
            the amount of any finance charge in connection with the
            transaction, [or] (ii) in the case of an individual
            action relating to a consumer lease under chapter 5 of
            this title, 25 per centum of the total amount of
            monthly payments under the lease, except that the
            liability under this subparagraph shall not be less
            than $100 nor greater than $1,000, or (iii) in the case
            of an individual action relating to a credit
            transaction not under an open end credit plan that is
            secured by real property or a dwelling, not less than
            $250 or greater than $2,500; or
              * * * * * * *

    Sec. 131. Liability of assignees

      (a) * * *
              * * * * * * *
      (e) Liability of Assignee for Consumer Credit Transactions
    Secured by Real Property.--
              (1) In general.--Except as otherwise specifically
            provided in this title, any civil action against a
            creditor for a violation of this title, and any
            proceeding under section 108 against a creditor, with
            respect to a consumer credit transaction secured by
            real property may be maintained against any assignee of
            such creditor only if--
                      (A) the violation for which such action or
                    proceeding is brought is apparent on the face
                    of the disclosure statement provided in
                    connection with such transaction pursuant to
                    this title; and
                      (B) the assignment to the assignee was
                    voluntary.
              (2) Violation apparent on the face of the disclosure
            described.--For the purpose of this section, a
            violation is apparent on the face of the disclosure
            statement if--
                      (A) the disclosure can be determined to be
                    incomplete or inaccurate from the face of the
                    disclosure statement, any itemization of the
                    amount financed, or any other disclosure of
                    disbursement; or
                      (B) the disclosure statement does not use the
                    terms or format required to be used by this
                    title.
      (f) Treatment of Servicer.--
              (1) In general.--A servicer of a consumer obligation
            arising from a consumer credit transaction shall not be
            treated as an assignee of such obligation for purposes
            of this section unless the servicer is the owner of the
            obligation.
              (2) Servicer not treated as owner on basis of
            assignment for administrative convenience.--A servicer
            of a consumer obligation arising from a consumer credit
            transaction shall not be treated as the owner of the
            obligation for purposes of this section on the basis of
            an assignment of the obligation from the creditor or
            another assignee to the servicer solely for the
            administrative convenience of the servicer in servicing
            the obligation. Upon written request by the obligor,
            the servicer shall provide the obligor, to the best
            knowledge of the servicer, with the name, address, and
            telephone number of the owner of the obligation or the
            master servicer of the obligation.
              (3) Servicer defined.--For purposes of this
            subsection, the term ``servicer'' has the same meaning
            as in section 6(i)(2) of the Real Estate Settlement
            Procedures Act of 1974.
              * * * * * * *

    SEC. 139. CERTAIN LIMITATIONS ON LIABILITY.

      (a) Limitations on Liability.--For any consumer credit
    transaction subject to this title that is consummated before
    the date of the enactment of the Financial Institutions
    Regulatory Relief Act of 1995, a creditor or any assignee of a
    creditor shall have no civil, administrative, or criminal
    liability under this title for, and a consumer shall have no
    extended rescission rights under section 125(f) with respect
    to--
              (1) the creditor's treatment, for disclosure
            purposes, of--
                      (A) taxes described in section 106(d)(3);
                      (B) fees and amounts described in section
                    106(e) (2) and (5);
                      (C) fees and amounts referred to in the 3rd
                    sentence of section 106(a); or
                      (D) mortgage broker fees referred to in
                    section 106(a)(6);
              (2) the form of written notice used by the creditor
            to inform the obligor of the rights of the obligor
            under section 125 if the creditor provided the obligor
            with a properly dated form of written notice published
            and adopted by the Board or a comparable written
            notice; or
              (3) any disclosure relating to the finance charge
            imposed with respect to the transaction if the amount
            or percentage actually disclosed--
                      (A) may be treated as accurate pursuant to
                    section 106(f), or
                      (B) is greater than the amount or percentage
                    required to be disclosed under this title.
      (b) Exceptions.--Subsection (a) shall not apply to--
              (1) any individual action or counterclaim brought
            under this title which was filed before June 1, 1995;
              (2) any class action brought under this title for
            which a final order certifying a class was entered
            before January 1, 1995;
              (3) the named individual plaintiffs in any class
            action brought under this title which was filed before
            June 1, 1995; or
              (4) any consumer credit transaction with respect to
            which a timely notice of rescission was sent to the
            creditor before June 1, 1995.
                                  ----------

          SECTION 106 OF THE HOUSING AND URBAN DEVELOPMENT ACT OF 1968

     technical assistance, counseling to tenants and homeowners, and loans
                to sponsors of low- and moderate-income housing

        Sec. 106. (a) * * *
              * * * * * * *
        (c) Grants for Homeownership Counseling Organizations.--
              (1) * * *
              * * * * * * *
              [(5) Notification of availability of homeownership
            counseling.--
                      [(A) Notification of availability of
                    homeownership counseling.--
                              [(i) Requirement.--Except as provided
                            in subparagraph (C), the creditor of a
                            loan (or proposed creditor) shall
                            provide notice under clause (ii) to (I)
                            any eligible homeowner who fails to pay
                            any amount by the date the amount is
                            due under a home loan, and (II) any
                            applicant for a mortgage described in
                            paragraph (4).
                              [(ii) Content.--Notification under
                            this subparagraph shall--
                                      [(I) notify the homeowner or
                                    mortgage applicant of the
                                    availability of any
                                    homeownership counseling
                                    offered by the creditor (or
                                    proposed creditor);
                                      [(II) if provided to an
                                    eligible mortgage applicant,
                                    state that completion of a
                                    counseling program is required
                                    for insurance pursuant to
                                    section 203 of the National
                                    Housing Act; and
                                      [(III) notify the homeowner
                                    or mortgage applicant of the
                                    availability of homeownership
                                    counseling provided by
                                    nonprofit organizations
                                    approved by the Secretary and
                                    experienced in the provision of
                                    homeownership counseling, or
                                    provide the toll-free telephone
                                    number described in
                                    subparagraph (D)(i).
                      [(B) Deadline for notification.--The
                    notification required in subparagraph (A) shall
                    be made--
                              [(i) in a manner approved by the
                            Secretary; and
                              [(ii) before the expiration of the
                            45-day period beginning on the date on
                            which the failure referred to in such
                            subparagraph occurs.
                      [(C) Exceptions.--Notification under
                    subparagraph (A) shall not be required with
                    respect to any loan--
                              [(i) insured or guaranteed under
                            chapter 37 of title 38, United States
                            Code; or
                              [(ii) for which the eligible
                            homeowner pays the amount overdue
                            before the expiration of the 45-day
                            period under subparagraph (B)(ii).
                      [(D) Administration and compliance.--The
                    Secretary shall, to the extent of amounts
                    approved in appropriation Acts, enter into an
                    agreement with an appropriate private entity
                    under which the entity will--
                              [(i) operate a toll-free telephone
                            number through which any eligible
                            homeowner can obtain a list of
                            nonprofit organizations, which shall be
                            updated annually, that--
                                      [(I) are approved by the
                                    Secretary and experienced in
                                    the provision of homeownership
                                    counseling; and
                                      [(II) serve the area in which
                                    the residential property of the
                                    homeowner is located;
                              [(ii) monitor the compliance of
                            creditors with the requirements of
                            subparagraphs (A) and (B); and
                              [(iii) report to the Secretary not
                            less than annually regarding the extent
                            of compliance of creditors with the
                            requirements of subparagraphs (A) and
                            (B).
                      [(E) Report.--The Secretary shall submit a
                    report to the Congress not less than annually
                    regarding the extent of compliance of creditors
                    with the requirements of subparagraphs (A) and
                    (B) and the effectiveness of the entity
                    monitoring such compliance. The Secretary shall
                    also include in the report any recommendations
                    for legislative action to increase the
                    authority of the Secretary to penalize
                    creditors who do not comply with such
                    requirements.]
              * * * * * * *
                      HOME MORTGAGE DISCLOSURE ACT OF 1975

                      TITLE III--HOME MORTGAGE DISCLOSURE

                                  short title

        Sec. 301. This title may be cited as the ``Home Mortgage
    Disclosure Act of 1975''.
              * * * * * * *

                  maintenance of records and public disclosure

        Sec. 304. (a) * * *
              * * * * * * *
      (m) Opportunity To Reduce Compliance Burden.--
              (1) A depository institution will have satisfied the
            public availability requirements of subsection (a) if
            such institution keeps the information required under
            that subsection at its home office and provides notice
            at the branch locations specified in such subsection
            that such information is available upon request from
            the home office of the institution. A home office of
            the depository institution receiving a request for such
            information pursuant to this subsection shall provide
            the information pertinent to the location of the branch
            in question within fifteen days of the receipt of the
            written request.
              (2) In complying with paragraph (1), a depository
            institution may provide the individual requesting such
            information, at the institution's choice, with--
                      (A) a paper copy of the information
                    requested; or
                      (B) if acceptable to the individual, the
                    information through a form of electronic
                    medium, such as computer disc.
              * * * * * * *

                                 effective date

        Sec. 309. This title shall take effect on the one hundred
    and eightieth day beginning after the date of its enactment.
    Any institution specified in section 303(2)(A) which has total
    assets as of its last full fiscal year of [$10,000,000]
    $50,000,000 or less is exempt from the provisions of this
    title. The Board, in consultation with the Secretary, may
    exempt institutions described in section 303(2)(B) that are
    comparable within their respective industries to institutions
    that are exempt under the preceding sentence. The Board may
    also, by regulation, exempt from the provisions of this Act
    institutions specified in section 303(2)(A) which have total
    assets as of their last full fiscal year of $50,000,000 or
    greater where the burden of complying with this Act on such
    institutions outweighs the usefulness of the information
    required to be disclosed. The exemptions provided under this
    section shall not be applicable to an institution which the
    Board, by order, has found a reasonable basis to believe is not
    fulfilling its obligations to serve the housing needs of the
    communities and neighborhoods in which it located. An
    institution subject to such an order shall be required to
    comply with the requirements of this Act for loans made after
    the time that the order is issued at such time and for such
    period as the Board deems appropriate. The dollar amount in
    this section shall be adjusted annually after December 31,
    1994, by the annual percentage increase in the Consumer Price
    Index for Urban Wage Earners and Clerical Workers published by
    the Bureau of Labor Statistics.
              * * * * * * *
                                  ----------

                       COMMUNITY REINVESTMENT ACT OF 1977

                       TITLE VIII--COMMUNITY REINVESTMENT

        Sec. 801. This title may be cited as the ``Community
    Reinvestment Act of 1977''.
      Sec. 802. (a) * * *
        [(b) It is the purpose of this title to require each
    appropriate Federal financial supervisory agency to use its
    authority when examining financial institutions, to encourage
    such institutions to help meet the credit needs of the local
    communities in which they are chartered consistent with the
    safe and sound operation of such institutions.]
      (b) It is the purpose of this title to require each
    appropriate Federal financial supervisory agency to use its
    authority, when examining financial institutions, to encourage
    such institutions to help meet the credit needs of the local
    communities in which they are chartered consistent with the
    safe and sound operation of such institutions. When examining
    financial institutions, a supervisory agency shall not impose
    additional burden, recordkeeping, or reporting upon such
    institutions.
        Sec. 803. For the purposes of this title--
              (1) the term ``appropriate Federal financial
            supervisory agency'' means--
                      (A) the Comptroller of the Currency with
                    respect to national banks;
              * * * * * * *
              [(2) section 8 of the Federal Deposit Insurance Act,
            by the Director of the Office of Thrift Supervision, in
            the case of a savings association (the deposits of
            which are insured by the Federal Deposit Insurance
            Corporation) and a savings and loan holding company;]
                      (D) the Director of the Office of Thrift
                    Supervision with respect to any savings
                    association (the deposits of which are insured
                    by the Federal Deposit Insurance Corporation)
                    and any savings and loan holding company (other
                    than a company which is a bank holding
                    company);
              * * * * * * *
              (5) Special purpose institutions.--The term ``special
            purpose institution'' means a financial institution
            that does not generally accept deposits from the public
            in amounts of less than $100,000, such as wholesale,
            credit card, and trust institutions.
              (6) State bank supervisor.--The term ``State bank
            supervisor'' has the same meaning as in section 3(r) of
            the Federal Deposit Insurance Act.
        Sec. 804. (a) In General.--In connection with its
    examination of a financial institution, conducted in accordance
    with section 806A, the appropriate Federal financial
    supervisory agency shall--
              (1) assess the institution's record of meeting the
            credit needs of its entire community, including low-
            and moderate-income neighborhoods, consistent with the
            safe and sound operation of such institution; and
              [(2) take such record into account in its evaluation
            of an application for a deposit facility by such
            institution.]
              (2) take such record into account in the overall
            evaluation of the condition of the institution by the
            appropriate Federal financial supervisory agency.
      [(b) Majority-Owned Institutions.--In assessing and taking
    into account, under subsection (a), the record of a
    nonminority-owned and nonwomen-owned financial institution, the
    appropriate Federal financial supervisory agency may consider
    as a factor capital investment, loan participation, and other
    ventures undertaken by the institution in cooperation with
    minority- and women-owned financial institutions and low-income
    credit unions provided that these activities help meet the
    credit needs of local communities in which such institutions
    and credit unions are chartered.]
      (b) Positive Consideration of Certain Loans and
    Investments.--In assessing and taking into account the records
    of a regulated financial institution under subsection (a), the
    appropriate Federal financial supervisory agency shall--
              (1) consider as a positive factor, consistent with
            the safe and sound operation of the institution, the
            institution's investment in or loan to--
                      (A) any minority depository institution or
                    women's depository institution (as such terms
                    are defined in section 808(b)) or any low-
                    income credit union;
                      (B) any joint venture or other entity or
                    project which promotes the public welfare in
                    any distressed community (as defined by such
                    agency) whether or not the distressed community
                    is located in the local community in which the
                    regulated financial institution is chartered to
                    do business; and
                      (C) targeted low- and moderate-income
                    communities, including real property loans to
                    such communities; and
              (2) consider equally with other factors capital
            investment, loan participation, and other ventures
            undertaken by the institution in cooperation with--
                      (A) minority- and women-owned financial
                    institutions and low-income credit unions to
                    the extent that these activities help meet the
                    credit needs of the local communities in which
                    such institutions are chartered; and
                      (B) community development corporations in
                    extending credit and other financial services
                    principally to low- and moderate-income persons
                    and small businesses to the extent that such
                    community development corporations help meet
                    the credit needs of the local communities
                    served by the majority-owned institution.
      (c) Self-Certification of CRA Compliance.--
              (1) Certification.--In lieu of being evaluated under
            section 806A and receiving a written evaluation under
            section 807, a qualifying financial institution may
            elect to self-certify to the appropriate Federal
            financial supervisory agency that such institution is
            in compliance with the goals of this title.
              (2) Qualifying institution.--
                      (A) In general.--For purposes of paragraph
                    (1), the term ``qualifying institution'' means
                    a financial institution which--
                              (i) has not more than $250 million in
                            assets;
                              (ii) has not been found to have
                            engaged in a pattern or practice of
                            illegal discrimination under the Fair
                            Housing Act or the Equal Credit
                            Opportunity Act for the preceding 5-
                            year calendar period; and
                              (iii) received rating under section
                            807(b)(2) of ``satisfactory'' or
                            ``outstanding'' in the most recent
                            evaluation of such institution under
                            this title.
                      (B) Annual adjustment.--The dollar amount in
                    subparagraph (A) shall be adjusted annually
                    after December 31, 1994, by the annual
                    percentage increase in the Consumer Price Index
                    for Urban Wage Earners and Clerical Workers
                    published by the Bureau of Labor Statistics.
              (3) Public notice.--
                      (A) In general.--A qualifying institution
                    shall maintain in every branch a public notice
                    stating that--
                              (i) the institution has self-
                            certified that the institution is
                            satisfactorily helping to meet the
                            credit needs of its community; and
                              (ii) the institution maintains--
                                      (I) at the main office of
                                    such institution, a public file
                                    which contains a copy of the
                                    self-certification to the
                                    appropriate Federal financial
                                    supervisory agency; and
                                      (II) a map delineating the
                                    community served by the
                                    institution;
                              (iii) a list of the types of credit
                            and services that the institution
                            provides to the community served by the
                            institution;
                              (iv) such other information that the
                            institution believes demonstrates the
                            institution's record of helping to meet
                            the credit needs of its community; and
                              (v) every public comment or letter to
                            the institution (and any response by
                            the institution) received within the
                            previous 2-year period about the record
                            of the institution of helping to meet
                            the credit needs of its community.
                      (B) Public file.--A qualifying institution
                    shall maintain a public file containing the
                    contents described in this paragraph at the
                    institution's main office
              (4) Rating.--
                      (A) In general.--A qualifying institution
                    shall be deemed to have a rating of a
                    ``satisfactory record of meeting community
                    credit needs'' for the purposes of this section
                    and section 806A(c).
                      (B) Publication.--Each Federal financial
                    supervisory agency shall publish in the Federal
                    Register once each month a list of institutions
                    that have self-certified during the previous
                    month.
                      (C) Publication constitutes disclosure.--
                    Publication of the name of the institution in
                    the Federal Register as having self-certified
                    shall constitute disclosure of the rating of
                    the institution to the public for purposes of
                    sections 806A and 807.
              (5) Regulatory review.--
                      (A) Assessment.--During each examination for
                    safety and soundness, a qualifying
                    institution's supervisory agency shall, as part
                    of the agency's review of the institution's
                    loans, assess whether the institution's basis
                    for its self-certification is reasonable based
                    on the public notice and the information
                    contained in the public file pursuant to
                    paragraph (3).
                      (B) Examination if self-certification is not
                    reasonable.--If the agency determines that the
                    institution's basis for the institution's self-
                    certification is not reasonable, the agency
                    shall schedule an examination of the
                    institution for the purpose of assessing the
                    institution's record of helping to meet the
                    credit needs of its community.
                      (C) Revocation of self-certification.--If an
                    assessment pursuant to subparagraph (B) results
                    in a less than ``satisfactory'' rating, the
                    agency shall revoke the institution's self-
                    certification and substitute a written
                    evaluation as provided under section 807.
                      (D) Period of ineligibility for self-
                    certification.--An institution whose self-
                    certification has been revoked may not self-
                    certify pursuant to this subsection during the
                    5 years succeeding the year in which the self-
                    certification is revoked.
                      (E) Subsequent eligibility.--After the end of
                    the period of ineligibility described in
                    subparagraph (D), an institution which meets
                    the requirements for self-certification may
                    elect to self-certify.
              (6) Prohibition on additional requirements.--No
            appropriate Federal financial supervisory agency may
            impose any additional requirements, whether by
            regulation or otherwise, relating to the self-
            certification procedure under this subsection.
      (d) Special Purpose Institutions.--
              (1) In general.--In conducting assessments pursuant
            to this section at any special purpose institution, the
            appropriate Federal financial supervisory agency
            shall--
                      (A) consider the nature of business such
                    institution is involved in; and
                      (B) assess and take into account the record
                    of the institution commensurate with the amount
                    of deposits (as defined in section 3(1) of the
                    Federal Deposit Insurance Act) received by such
                    institution.
              (2) Standards.--Each appropriate Federal financial
            supervisory agency shall develop standards under which
            special purpose institutions may be deemed to have
            complied with the requirements of this title which are
            consistent with the specific nature of such businesses.
              * * * * * * *
        [Sec. 806. Regulations to carry out the purposes of this
    title shall be published by each appropriate Federal financial
    supervisory agency, and shall take effect no later than 390
    days after the date of enactment of this title.]
    SEC. 806. REGULATIONS.

      (a) In General.--
              (1) Publication requirement.--Regulations to carry
            out the purposes of this title shall be published by
            each appropriate Federal financial supervisory agency.
              (2) Prohibition on additional recordkeeping.--
            Regulations prescribed and policy statements,
            commentary, examiner guidance, or other supervisory
            material issued under this title shall not impose any
            additional recordkeeping on a financial institution.
              (3) Prohibition on loan data collection.--No loan
            data may be required to be collected and reported by a
            financial institution and no such data may be made
            public by any Federal financial supervisory agency
            under this title.
      (b) Limitation on Regulations.--No regulation may be
    prescribed under this title by any Federal agency which would--
              (1) require any regulated financial institution to--
                      (A) make any loan or enter into any other
                    agreement on the basis of any discriminatory
                    criteria prohibited under any law of the United
                    States; or
                      (B) make any loan to, or enter into any other
                    agreement with, any uncreditworthy person that
                    would jeopardize the safety and soundness of
                    such institution; or
              (2) prevent or hinder in any way a financial
            institution's full responsibility to provide credit to
            all segments of the community.
      (c) Encourage Loans to Creditworthy Borrowers.--Regulations
    prescribed under this title shall encourage regulated financial
    institutions to make loans and extend credit to all
    creditworthy persons, consistent with safety and soundness.
              * * * * * * *
    SEC. 806A. COMMUNITY INPUT AND CONCLUSIVE RATING.

      (a) Publication of Exam Schedule and Opportunity for
    Comment.--
              (1) Publication of notice.--Each appropriate Federal
            financial supervisory agency shall
                      (A) publish in the Federal Register, 30 days
                    before the beginning of a calendar quarter, a
                    listing of institutions scheduled for
                    evaluation for compliance with this title
                    during such calendar quarter; and
                      (B) provide opportunity for written comments
                    from the community on the performance, under
                    this title, of each institution scheduled for
                    evaluation.
              (2) Comment period.--Written comments may not be
            submitted to an appropriate Federal financial
            supervisory agency pursuant to paragraph (1) after the
            end of the 30-day period beginning on the first day of
            the calendar quarter.
              (3) Copy of comments.--The agency shall provide a
            copy of such comments to the institution.
      (b) Evaluation.--The appropriate Federal financial
    supervisory agency shall--
              (1) evaluate the institution in accordance with the
            standards contained in section 804; and
              (2) prepare and publish a written evaluation of the
            institution as required under section 807.
      (c) Reconsideration of Rating.--
              (1) Request for reconsideration.--A reconsideration
            of an institution's rating referred to in section
            807(b)(1)(C), may be requested within 30 days of the
            rating's disclosure to the public.
              (2) Procedures for request.--Any such request shall
            be made in writing and filed with the appropriate
            Federal financial supervisory agency, and may be filed
            by the institution or a member of the community.
              (3) Basis for request.--Any request for
            reconsideration under this subsection shall be based on
            significant issues of a substantive nature which are
            relevant to the delineated community of the institution
            and, in the case of a request by a member of the
            community, shall be limited to issues previously raised
            in comments submitted pursuant to subsection (a).
              (4) Completion of review.--The appropriate Federal
            financial supervisory agency shall complete any
            requested reconsideration within 30 days of the filing
            of the request.
      (d) Conclusive Rating.--
              (1) In general.--An institution's rating shall become
            conclusive on the later of--
                      (A) 30 days after the rating is disclosed to
                    the public; or
                      (B) the completion of any requested
                    reconsideration by the Federal financial
                    supervisory agency.
              (2) Rating conclusive of meeting community credit
            needs.--An institution's rating shall be the conclusive
            assessment of the institution's record of meeting the
            credit needs of its community for purposes of section
            804 until the institution's next rating, developed
            pursuant to an examination, becomes conclusive.
              (3) Safe harbor.--Institutions which have received a
            ``satisfactory'' or ``outstanding'' rating shall be
            deemed to have met the purposes of section 804.
              (4) Rule of construction.--Notwithstanding any other
            provision of law, no provision of this section shall be
            construed as granting a cause of action to any person.
    SEC. 807. WRITTEN EVALUATIONS.

        (a) * * *
        (b) Public Section of Report.--
              (1) Findings and conclusions.--
                      (A) * * *
                      (B) Metropolitan area distinctions.--[The
                    information] In the case of a regulated
                    financial institution that maintains domestic
                    branches in 2 or more States, the information
                    required by clauses (i) and (ii) of
                    subparagraph (A) shall be presented separately
                    for each metropolitan area in which a regulated
                    depository institution maintains one or more
                    domestic branch offices.
              * * * * * * *
    SEC. 809. EXAMINATION EXEMPTION.

      (a) In General.--A regulated financial institution shall not
    be subject to the examination requirements of this title or any
    regulations issued under this section if the institution and
    any bank holding company which controls such institution have
    aggregate assets of not more than $100,000,000.
      (b) Annual Adjustment.--The dollar amount in subsection (a)
    shall be adjusted annually after December 31, 1994, by the
    annual percentage increase in the Consumer Price Index for
    Urban Wage Earners and Clerical Workers published by the Bureau
    of Labor Statistics.
                                  ----------

                           FEDERAL HOME LOAN BANK ACT

              * * * * * * *

                 eligibility of members and nonmember borrowers

      Sec. 4. (a) * * *
      [(b) An institution eligible to become a member under this
    section may become a member only of, or secure advances from,
    the Federal Home Loan Bank of the district in which is located
    the institution's principal place of business, or of the bank
    of a district adjoining such district, if demanded by
    convenience and then only with the approval of the Board.]
      (b) Membership Based on Conveniency.--An institution eligible
    to become a member of a Federal home loan bank under this
    section may become a member by submitting the institution's
    application for membership to the bank in the district where
    the applicant's principal place of business is located. An
    application for membership shall be approved by the bank if, in
    the judgment of the bank, the applicant meets the criteria for
    eligibility contained in this section. An institution eligible
    to become a member under this section may apply for membership
    in an adjoining district, if appropriate for the convenience of
    the institution and then only with the approval of the Board.
              * * * * * * *

                              advances to members

      Sec. 10. (a) * * *
              * * * * * * *
      (g) Community Support Requirements.--
              (1) * * *
              * * * * * * *
              (3) Special rule.--This subsection shall not apply to
            members receiving a grade of ``outstanding'' or
            ``satisfactory'' under section 807 of the Community
            Reinvestment Act of 1977.
              * * * * * * *

                       general powers and duties of banks

      Sec. 11. (a) * * *
              * * * * * * *
      [(j) Notwithstanding the provisions of the first sentence of
    section 202 of the Government Corporation Control Act, audits
    by the General Accounting Office of the financial transactions
    of a Federal Home Loan Bank shall not be limited to periods
    during which Government capital has been invested therein. The
    provisions of the first sentence of subsection (d) of section
    303 of the Government Corporation Control Act shall not apply
    to any Federal Home Loan Bank.]
      (j) Audits.--
              (1) Notwithstanding any other provision of law,
            audits by the Comptroller General of the United States
            of the financial transactions of a Federal home loan
            bank shall not be limited to periods during which
            Government capital has been invested in the bank. The
            provisions of section 9107(c)(2) and 9108(d)(1) of
            title 31, of such Code, shall not apply to any Federal
            home loan bank.
              (2) Notwithstanding any other provision of law, the
            Board shall not participate in the hiring of an
            external auditor by the banks; except, that the Board
            may establish requirements for external audit contracts
            and, that all 12 banks shall contract for an annual
            audit with a single provider.
              * * * * * * *
                         FEDERAL DEPOSIT INSURANCE ACT

              * * * * * * *
      Sec. 3. As used in this Act--
      (a) * * *
              * * * * * * *
      [(o) The term] (o) Definitions Relating to Branches.--
              (1) Domestic Branch.--
                      (A) In general.--The term ``domestic branch''
                    includes any branch bank, branch office, branch
                    agency, additional office, or any branch place
                    of business located in any State of the United
                    States or in any Territory of the United
                    States, Puerto Rico, Guam, American Samoa, the
                    Trust Territory of the Pacific Islands, or the
                    Virgin Islands at which deposits are received
                    or checks paid or money [lent; and the term]
                    lent.
                      (B) Certain proprietary atms and remote
                    servicing units.--The term ``domestic branch''
                    does not include any automated teller machine
                    or remote service unit which is owned and
                    operated by a depository institution--
                              (i) primarily for the benefit of the
                            institution and the affiliates of the
                            institution; and
                              (ii) which could operate a branch at
                            the location of such machine or unit.
              (2) Foreign branch.--The term ``foreign branch''
            means any office or place of business located outside
            the United States, its territories, Puerto Rico, Guam,
            American Samoa, or the Virgin Islands, at which banking
            operations are conducted.
              * * * * * * *
      (u) Institution-Affiliated Party.--The term ``institution-
    affiliated party'' means--
              (1) any director (other than an outside director),
            officer, employee, or controlling stockholder (other
            than a bank holding company) of, or agent for, an
            insured depository institution;
              * * * * * * *
              (3) any shareholder (other than a bank holding
            company), consultant, joint venture partner, and any
            other person (other than an outside director) as
            determined by the appropriate Federal banking agency
            (by regulation or case-by-case) who participates in the
            conduct of the affairs of an insured depository
            institution; and
              (4) any independent contractor (including any
            attorney, appraiser, or accountant) or outside director
            who knowingly or recklessly participates in--
                      (A)  * * *
              * * * * * * *

    SEC. 5. DEPOSIT INSURANCE.

      (a) * * *
              * * * * * * *
      (d) Insurance Fees.--
              (1) * * *
              * * * * * * *
              (3) Optional conversions subject to special rules on
            deposit insurance payments.--
                      (A) Conversions allowed.--Notwithstanding
                    paragraph (2)(A), and subject to the
                    requirements of this paragraph, any insured
                    depository institution may participate in a
                    transaction described in clause (ii), (iii), or
                    (iv) of paragraph (2)(B) [with the prior
                    written approval of the responsible agency
                    under section 18(c)(2)].
              * * * * * * *
                      (E) Conditions [for approval, generally].--
                              [(i) Factors to be considered;
                            approval process.--In reviewing any
                            application for a proposed transaction
                            under subparagraph (A), the responsible
                            agency shall follow the procedures and
                            consider the factors set forth in
                            section 18(c).
                              [(ii) Information required.--An
                            application to engage in any
                            transaction under this paragraph shall
                            contain such information relating to
                            the factors to be considered for
                            approval as the responsible agency may
                            require, by regulation or by specific
                            request, in connection with any
                            particular application.
                              [(iii)] (i) No transfer of deposit
                            insurance permitted.--This paragraph
                            shall not be construed as authorizing
                            transactions which result in the
                            transfer of any insured depository
                            institution's Federal deposit insurance
                            from 1 Federal deposit insurance fund
                            to the other Federal deposit insurance
                            fund.
                              [(iv) Minimum capital.--The
                            responsible agency shall disapprove any
                            application for any transaction under
                            this paragraph unless such agency
                            determines that the acquiring,
                            assuming, or resulting depository
                            institution will meet all applicable
                            capital requirements upon consummation
                            of the transaction.]
                              (ii) A transaction shall not be
                            authorized under this paragraph unless
                            the acquiring, assuming, or resulting
                            depository institution will meet all
                            applicable capital requirements upon
                            consummation of the transaction.
              * * * * * * *
                      [(G) Expedited approval of acquisitions.--
                              [(i) In general.--Any application by
                            a State nonmember insured bank to
                            acquire another insured depository
                            institution that is required to be
                            filed with the Corporation by
                            subparagraph (A) or any other
                            applicable law or regulation shall be
                            approved or disapproved in writing by
                            the Corporation before the end of the
                            60-day period beginning on the date
                            such application is filed with the
                            Corporation.
                              [(ii) Extensions of period.--The
                            period for approval or disapproval
                            referred to in clause (i) may be
                            extended for an additional 30-day
                            period if the Corporation determines
                            that--
                                      [(I) an applicant has not
                                    furnished all of the
                                    information required to be
                                    submitted; or
                                      [(II) in the Corporation's
                                    judgment, any material
                                    information submitted is
                                    substantially inaccurate or
                                    incomplete.
                      [(H)] (G) Allocation of costs in event of
                    default.--If any acquiring, assuming, or
                    resulting depository institution is in default
                    or danger of default at any time before this
                    paragraph ceases to apply, any loss incurred by
                    the Corporation shall be allocated between the
                    Bank Insurance Fund and the Savings Association
                    Insurance Fund, in amounts reflecting the
                    amount of insured deposits of such acquiring,
                    assuming, or resulting depository institution
                    assessed by the Bank Insurance Fund and the
                    Savings Association Insurance Fund,
                    respectively, under subparagraph (B).
                      [(I)] (H) Subsequent approval of conversion
                    transaction.--This paragraph shall cease to
                    apply if--
                              (i) after the end of the moratorium
                            period established by paragraph (2)(A),
                            the Corporation approves an application
                            by any acquiring, assuming, or
                            resulting depository institution to
                            treat the transaction described in
                            subparagraph (A) as a conversion
                            transaction; and
                              (ii) the acquiring, assuming, or
                            resulting depository institution pays
                            the amount of any exit and entrance fee
                            assessed by the Corporation under
                            subparagraph (E) of paragraph (2) with
                            respect to such transaction.
                      [(J)] (I) Acquiring, assuming, or resulting
                    depository institution defined.--For purposes
                    of this paragraph, the term ``acquiring,
                    assuming, or resulting depository institution''
                    means any insured depository institution
                    which--
                              (i) results from any transaction
                            described in paragraph (2)(B)(ii) and
                            approved under this paragraph;
              * * * * * * *
      Sec. 7. (a) * * *
              * * * * * * *
      [(k) The appropriate Federal banking agencies are authorized
    to issue rules and regulations, including definitions of terms,
    to require the reporting and public disclosure of information
    by a bank or any executive officer or prinicipal shareholder
    thereof concerning extensions of credit by the bank to any of
    its executive officers or principal shareholders, or the
    related interests of such persons.]
              * * * * * * *
      Sec. 10. (a) * * *
              * * * * * * *
      (d) Annual On-Site Examinations of All Insured Depository
    Institutions Required.--
              (1) * * *
              * * * * * * *
              (8) Report.--At the time the system provided for in
            paragraph (6) is established, the Federal banking
            agencies shall submit a joint report describing the
            system to the Committee on Banking, Housing, and Urban
            Affairs of the Senate and the Committee on Banking,
            Finance and Urban Affairs of the House of
            Representatives. Thereafter, the Federal banking
            agencies shall annually submit a joint report to the
            Committee on Banking, Housing, and Urban Affairs of the
            Senate and the Committee on Banking, Finance and Urban
            Affairs of the House of Representatives regarding the
            progress of the agencies in implementing the system and
            indicating areas in which enhancements to the system,
            including legislature improvements, would be
            appropriate.
              [(8)] (9) Agencies authorized to increase maximum
            asset amount of institutions for certain purposes.--At
            any time after the end of the 2-year period beginning
            on the date of enactment of the Riegle Community
            Development and Regulatory Improvement Act of 1994, the
            appropriate Federal banking agency, in the agency's
            discretion, may increase the maximum amount limitation
            contained in paragraph (4)(C)(ii), by regulation, from
            $100,000,000 to an amount not to exceed [$175,000,000]
            $250,000,000 for purposes of such paragraph, if the
            agency determines that the greater amount would be
            consistent with the principles of safety and soundness
            for insured depository institutions.
              [(9)] (10) Standards for determining adequacy of
            state examinations.--The Federal Financial Institutions
            Examination Council shall issue guidelines establishing
            standards to be used at the discretion of the
            appropriate Federal banking agency for purposes of
            making a determination under paragraph (3).
              (11) Annual cpi adjustment.--The dollar amount in
            this section shall be adjusted annually after December
            31, 1994, by the annual percentage increase in the
            Consumer Price Index for Urban Wage Earners and
            Clerical Workers published by the Bureau of Labor
            Statistics.
              * * * * * * *
      (j) Consultation Among Examiners.--
              (1) In general.--Each appropriate Federal banking
            agency shall take such action as may be necessary to
            ensure that examiners employed by the agency--
                      (A) consult on examination activities with
                    respect to any depository institution; and
                      (B) achieve an agreement and resolve any
                    inconsistencies on the recommendations to be
                    given to such institution as a consequence of
                    any examinations.
              (2) Examiner-in-charge.--Each agency shall consider
            appointing an examiner-in-charge with respect to a
            depository institution to ensure consultation on
            examination activities among all of the agency's
            examiners involved in examinations of such institution.
              * * * * * * *
      Sec. 18. (a) * * *
              * * * * * * *
      (c)(1) * * *
              * * * * * * *
              (12) The provisions of this subsection shall not
            apply to any merger, consolidation, acquisition of
            assets or assumption of liabilities involving only
            insured depository institutions that are subsidiaries
            of the same depository institution holding company if--
                      (A) the responsible agency would not be
                    prohibited from approving the transaction under
                    section 44, if applicable;
                      (B) the acquiring, assuming, or resulting
                    institution complies with all applicable
                    provisions of section 44, if any, as if the
                    merger, consolidation, or acquisition were
                    approved under this subsection;
                      (C) the acquiring, assuming, or resulting
                    institution provides written notification of
                    the transaction to the appropriate Federal
                    banking agency for the institution at least 10
                    days prior to consummation of the transaction;
                    and
                      (D) after receiving such notice, the agency
                    does not require the institution to submit an
                    application with respect to such transaction
                    and so notifies the institution.
      (d)(1) * * *
              * * * * * * *
              (5) Application exemption for certain banks.--
            Notwithstanding paragraph (1), the consent of the
            Corporation shall not be required for a State nonmember
            insured bank to establish and operate any domestic
            branch if--
                      (A) the bank is well-capitalized (as defined
                    in section 38 and regulations prescribed by the
                    Corporation under such section);
                      (B) the bank received a composite CAMEL
                    rating of ``1'' or ``2'' under the Uniform
                    Financial Institutions Rating System (or an
                    equivalent rating under a comparable rating
                    system) as of its most recent examination;
                      (C) the bank did not receive a ``needs to
                    improve'' or ``substantial noncompliance''
                    composite rating as result of the bank's most
                    recent examination under the Community
                    Reinvestment Act of 1977; and
                      (D) the Corporation is otherwise authorized
                    to give consent under this section to such bank
                    to establish and operate a domestic branch at
                    the proposed location.
              (6) Approval granted.--A branch established by a
            State member bank under paragraph (5) shall be deemed
            to have been established and operated pursuant to an
            application approved under this section.
              * * * * * * *
      (s) Customer Access to Products.--
              (1) In general.--Notwithstanding any other provision
            of law, any depository institution, or any affiliate or
            subsidiary of any depository institution, may share or
            exchange information or otherwise transfer information
            between or among themselves without any restriction or
            limitation if it is clearly and conspicuously disclosed
            that the information may be communicated among such
            persons and the consumer is given the opportunity,
            before the time that the information is initially
            communicated, to direct that such information not be
            communicated among such persons.
              (2) Definition.--For purposes of this subsection, the
            term ``information'' means any and all data, records,
            or other information and material obtained or
            maintained by any depository institution or any
            affiliate or subsidiary thereof in the ordinary course
            of its business that relates in any way to a person (as
            such term is defined in section 603(b) of the Fair
            Credit Reporting Act) who applies for, maintains, or
            has maintained an account or credit relationship with
            or applied for, purchased or obtained other products or
            services from any depository institution or any
            affiliate or subsidiary of any depository institution,
            regardless of the source of manner in which the
            information is obtained or furnished.
              (3) Rule of construction.--Any depository
            institution, or any affiliate or subsidiary of any
            depository institution, relying on this subsection
            shall not be deemed to be a consumer reporting agency,
            user, or third party, and the information itself shall
            not constitute a consumer report, within the meaning of
            the Fair Credit Reporting Act or other similar law.
              * * * * * * *

    SEC. 24. ACTIVITIES OF INSURED STATE BANKS.

      [(a) In General.--After the end of the 1-year period
    beginning on the date of the enactment of the Federal Deposit
    Insurance Corporation Improvement Act of 1991, an insured State
    bank may not engage as principal in any type of activity that
    is not permissible for a national bank unless--
              [(1) the Corporation has determined that the activity
            would pose no significant risk to the appropriate
            deposit insurance fund; and
              [(2) the State bank is, and continues to be, in
            compliance with applicable capital standards prescribed
            by the appropriate Federal banking agency.]
      (a) Activities Generally.--
              (1) In general.--An insured State bank may not engage
            as principal in any type of activity that is not
            permissible for a national bank unless--
                      (A) the bank has given the Corporation
                    written notice of the bank's intention to
                    engage in such activity at least 60 days before
                    commencing to engage in the activity and within
                    such 60-day period (or within the extended
                    period provided under paragraph (2)) the
                    Corporation has not disapproved the activity;
                    and
                      (B) the State bank is, and continues to be,
                    in compliance with applicable capital standards
                    prescribed by the appropriate Federal banking
                    agency.
              (2) Extension of period.--The Corporation may extend
            the 60-day period referred to in paragraph (1) for
            issuing a notice of disapproval with respect to any
            activity for an additional 30 days.
              (3) Contents of notice.--Any notice submitted by a
            State bank under paragraph (1)(A) shall contain such
            information as the Corporation may require.
              (4) Basis for disapproval.--The Corporation may
            disapprove an activity for a State bank under this
            subsection unless the Corporation determines that the
            activity would pose no significant risk to the
            appropriate insurance fund.
              * * * * * * *
      (d) Subsidiaries of Insured State Banks.--
              [(1) In general.--After the end of the 1-year period
            beginning on the date of the enactment of the Federal
            Deposit Insurance Corporation Improvement Act of 1991,
            a subsidiary of an insured State bank may not engage as
            principal in any type of activity that is not
            permissible for a subsidiary of a national bank
            unless--
                      [(A) the Corporation has determined that the
                    activity poses no significant risk to the
                    appropriate deposit insurance fund; and
                      [(B) the bank is, and continues to be, in
                    compliance with applicable capital standards
                    prescribed by the appropriate Federal banking
                    agency.]
              (1) Activities generally.--
                      (A) In general.--A subsidiary of an insured
                    State bank may not engage as principal in any
                    type of activity that is not permissible for a
                    subsidiary of a national bank unless--
                              (i) the subsidiary has given the
                            Corporation written notice of the
                            subsidiary's intention to engage in
                            such activity at least 60 days before
                            commencing to engage in the activity
                            and within such 60-day period (or
                            within the extended period provided
                            under paragraph (2)) the Corporation
                            has not disapproved the activity; and
                              (ii) the bank is, and continues to
                            be, in compliance with applicable
                            capital standards prescribed by the
                            appropriate Federal banking agency.
                      (B) Extension of period.--The Corporation may
                    extend the 60-day period referred to in
                    subparagraph (A) for issuing a notice of
                    disapproval with respect to any activity for an
                    additional 30 days.
                      (C) Contents of notice.--Any notice submitted
                    by a subsidiary of an insured State bank under
                    subparagraph (A)(i) shall contain such
                    information as the Corporation may require.
                      (D) Basis for disapproval.--The Corporation
                    may disapprove an activity for a subsidiary of
                    an insured State bank under this paragraph
                    unless the Corporation determines that the
                    activity would pose no significant risk to the
                    appropriate insurance fund.
              * * * * * * *

    SEC. 32. AGENCY DISAPPROVAL OF DIRECTORS AND SENIOR EXECUTIVE OFFICERS
                        OF INSURED DEPOSITORY INSTITUTIONS OR DEPOSITORY
                        INSTITUTION HOLDING COMPANIES.

      (a) * * *
              * * * * * * *
      [(d) Additional Information.--Any notice submitted to an
    appropriate Federal banking agency with respect to an
    individual by any insured depository institution or depository
    institution holding company pursuant to subsection (a) shall
    include--
              [(1) the information described in section 7(j)(6)(A)
            about the individual; and
              [(2) such other information as the agency may
            prescribe by regulation.]
      (d) Additional Information.--
              (1) In general.--Any notice submitted to an
            appropriate Federal banking agency with respect to an
            individual by any insured depository institution or
            depository institution holding company pursuant to
            subsection (a) shall include--
                      (A) the information described in section
                    7(j)(6)(A) about the individual; and
                      (B) such other information as the agency may
                    prescribe by regulation.
              (2) Waiver.--An appropriate Federal banking agency
            may waive the requirement of this section by regulation
            or on a case-by-case basis consistent with safety and
            soundness.
              * * * * * * *

    SEC. 36. EARLY IDENTIFICATION OF NEEDED IMPROVEMENTS IN FINANCIAL
                        MANAGEMENT.

      (a) Annual Report on Financial Condition and Management.--
              (1) * * *
              (2) Contents of report.--Any annual report required
            under paragraph (1) shall contain--
                      (A) the information required to be provided
                    by--
                              (i) the institution's management
                            under subsection (b); and
                              (ii) an independent public accountant
                            under [subsections (c) and (d)]
                            subsection (c); and
              (3) Public availability.--Any annual report required
            under paragraph (1) shall be available for public
            inspection. Notwithstanding the preceding sentence, the
            Corporation and the appropriate Federal banking
            agencies may designate certain information as
            privileged and confidential and not available to the
            public.
              * * * * * * *
      [(c) Internal Control Evaluation and Reporting Requirements
    for Independent Public Accountants.--
              [(1) In general.--With respect to any internal
            control report required by subsection (b)(2) of any
            institution, the institution's independent public
            accountant shall attest to, and report separately on,
            the assertions of the institution's management
            contained in such report.
              [(2) Attestation requirements.--Any attestation
            pursuant to paragraph (1) shall be made in accordance
            with generally accepted standards for attestation
            engagements.
      [(d)] (c) Annual Independent Audits of Financial
    Statements.--
              (1) Audits required.--The Corporation, in
            consultation with the appropriate Federal banking
            agencies, shall prescribe regulations requiring that
            each insured depository institution shall have an
            annual independent audit made of the institution's
            financial statements by an independent public
            accountant in accordance with generally accepted
            auditing standards and section 37.
              * * * * * * *
      [(e) Detecting and Reporting Violations of Laws and
    Regulations.--
              [(1) In general.--An independent public accountant
            shall apply procedures agreed upon by the Corporation
            to objectively determine the extent of the compliance
            of any insured depository institution or depository
            institution holding company with laws and regulations
            designated by the Corporation, in consultation with the
            appropriate Federal banking agencies.
              [(2) Attestation requirements.--Any attestation
            pursuant to paragraph (1) shall be made in accordance
            with generally accepted standards for attestation
            engagements.
      [(f)] (d) Form and Content of Reports and Auditing
    Standards.--
              (1) In general.--The scope of each report by an
            independent public accountant pursuant to this section,
            and the procedures followed in preparing such report,
            shall meet or exceed the scope and procedures required
            by generally accepted auditing standards and other
            applicable standards recognized by the Corporation.
              * * * * * * *
      [(g)] (e) Improved Accountability.--
              (1) Independent audit committee.--
                      (A) Establishment.--Each insured depository
                    institution (to which this section applies)
                    shall have an independent audit committee
                    entirely made up of outside directors who are
                    independent of management of the institution,
                    and who satisfy any specific requirements the
                    Corporation may establish.
                      (B) Duties.--An independent audit committee's
                    duties shall include reviewing with management
                    and the independent public accountant the basis
                    for the reports issued under subsections
                    [(b)(2), (c), and (d)] (b)(2) and (c).
              * * * * * * *
      [(h)] (f) Exchange of Reports and Information.--
              (1) Report to the independent auditor.--
                      (A) In general.--Each insured depository
                    institution which has engaged the services of
                    an independent auditor to audit such
                    institution shall transmit to the auditor a
                    copy of the most recent report of condition
                    made by the institution (pursuant to this Act
                    or any other provision of law) and a copy of
                    the most recent report of examination received
                    by the institution.
              * * * * * * *
      [(i)] (g) Requirements for Insured Subsidiaries of Holding
    Companies.--
              (1) In general.--Except with respect to any audit
            requirements established under or pursuant to
            subsection [(d)] (c), the requirements of this section
            may be satisfied for insured depository institutions
            that are subsidiaries of a holding company, if--
                      (A)  * * *
              * * * * * * *
      [(j)] (h) Exemption for Small Depository Institutions.--This
    section shall not apply with respect to any fiscal year of any
    insured depository institution the total assets of which, as of
    the beginning of such fiscal year, are less than the greater
    of--
              (1)  * * *
              * * * * * * *
      (i) Exemption for Well-Capitalized and Well-Managed Insured
    Depository Institutions.--No provision of this section other
    than subsection (c) shall apply with respect to any insured
    depository institution which is well-capitalized and well-
    managed.
              * * * * * * *

    SEC. 42. NOTICE OF BRANCH CLOSURE.

      (a) * * *
              * * * * * * *
      (e) Scope of Application.--
              (1) In general.--This section shall not apply with
            respect to--
                      (A) an automated teller machine;
                      (B) a branch which--
                              (i) has been acquired through merger,
                            consolidation, purchase, assumption, or
                            other method; and
                              (ii) is located--
                                      (I) within 2.5 miles of
                                    another branch of the acquiring
                                    institution; or
                                      (II) within a neighborhood
                                    currently being served by
                                    another branch of the acquiring
                                    institution,
                    if such other branch of the acquiring
                    institution is expected to continue to provide
                    banking services to substantially all of the
                    customers currently served by the branch
                    acquired;
                      (C) a branch which is closing and reopening
                    at a location which is--
                              (i) within 2.5 miles of the location
                            of the branch being closed; or
                              (ii) within the same neighborhood as
                            the branch being closed,
                    if the branch at the new location is expected
                    to continue to provide banking services to
                    substantially all of the customers served by
                    the branch at the former location;
                      (D) a branch that is closed in connection
                    with--
                              (i) an emergency acquisition under--
                                      (I) section 11(n); or
                                      (II) subsections (f) or (k)
                                    of section 13; or
                              (ii) any assistance provided by the
                            Corporation under section 13(c); and
                      (E) any other branch closure whose exemption
                    from the notice requirements of this section
                    would not produce a result inconsistent with
                    the purposes of this section.
              (2) Regulations.--The appropriate Federal banking
            agency shall, by regulation, determine the
            circumstances under which any exemption under
            paragraph(1)(E) may be granted.
              * * * * * * *
    SEC. 45. LENDER, FIDUCIARY, AND GOVERNMENT AGENCY ENVIRONMENTAL
                        LIABILITIES.

      (a) Lender Environmental Liability.--
              (1) In general.--Notwithstanding any other provision
            or rule of Federal law, no lender, acting as defined in
            this section, shall be liable pursuant to a Federal
            environmental law, except as provided in this section.
              (2) Actual participation required.--A lender shall
            only be liable pursuant to a Federal environmental law
            when the lender actually participates in management of
            another person's activities which create liability
            under the same Federal environmental law.
              (3) Definitions.--The following definitions shall
            apply for purposes of this section:
                      (A) Participate in management.--The term
                    ``participate in management'' means actually
                    participating in the management or operational
                    affairs of other persons' activities, and does
                    not include merely having the capacity to
                    influence, or the unexercised right to control
                    such activities;
                      (B) Participate in management.--A person
                    shall be considered to ``participate in
                    management'' while a borrower is still in
                    possession of property, only if such person--
                              (i) exercises decisionmaking control
                            over the environmental compliance of a
                            borrower, such that the person has
                            undertaken responsibility for the
                            hazardous substance handling or
                            disposal practices of the borrower; or
                              (ii) exercises control at a level
                            comparable to that of a manager of the
                            enterprise of the borrower, such that
                            the person has assumed or manifested
                            responsibility for the overall
                            management of the enterprise
                            encompassing day-to-day decisionmaking
                            with respect to environmental
                            compliance, or with respect to
                            substantially all of the operational
                            aspects (as distinguished from
                            financial or administrative aspects) of
                            the enterprise, other than
                            environmental compliance.
                      (C) Participate in management.--The term
                    ``participate in management'' does not include
                    engaging in an act or failing to act before the
                    time that an extension of credit is made or a
                    security interest is created in property.
                      (D) Participate in management.--The term
                    ``participate in management'' does not include,
                    unless such actions rise to the level of
                    participating in management (as defined in
                    subparagraphs (A) and (B))--
                              (i) holding an extension of credit or
                            a security interest or abandoning or
                            releasing an extension of credit or a
                            security interest;
                              (ii) including in the terms of an
                            extension of credit, or in a contract
                            or security agreement relating to such
                            an extension, covenants, warranties, or
                            other terms and conditions that relate
                            to environmental compliance;
                              (iii) monitoring or enforcing the
                            terms and conditions of an extension of
                            credit or security interest;
                              (iv) monitoring or undertaking 1 or
                            more inspections of property, except
                            that monitoring or undertaking any such
                            inspection, although not required by
                            this subsection, shall provide
                            probative evidence that a holder of a
                            security interest is acting to preserve
                            and protect the property during the
                            time the holder may have possession or
                            control of such property;
                              (v) requiring or conducting a
                            response action or other lawful means
                            of addressing the release or threatened
                            release of a hazardous substance in
                            connection with property prior to,
                            during, or upon the expiration of the
                            term of an extension of credit;
                              (vi) providing financial or other
                            advice or counseling in an effort to
                            mitigate, prevent, or cure default or
                            diminution in the value of the
                            property;
                              (vii) restructuring, renegotiating,
                            or otherwise agreeing to alter the
                            terms and conditions of an extension of
                            credit or security interest, or
                            exercising forbearance; or
                              (viii) exercising other remedies that
                            may be available under applicable law
                            for the breach of any term or condition
                            of the extension of credit or security
                            agreement.
                      (E) When a lender did not participate in
                    management of property prior to foreclosure,
                    then the lender shall not be liable even if
                    such person forecloses on property, sells, re-
                    leases, or liquidates property, maintains
                    business activities, winds up operations, or
                    undertakes any response action with respect to
                    property, or takes other measures to preserve,
                    protect, or prepare property prior to sale or
                    disposition, if such person seeks to sell,
                    release, or otherwise divest the property at
                    the earliest practical, commercially reasonable
                    time, on commercially reasonable terms, taking
                    into account market conditions and legal and
                    regulatory requirements.
              (4) Limitation on liability.--The liability of any
            lender that is liable under any Federal environmental
            law shall be limited to only the cost of any response
            action or corrective action to the extent and in the
            amount that the lender actively and directly
            contributed to the hazardous substance release. A
            lender shall not be liable for the cost of any response
            action or corrective action relating to the release of
            a hazardous substance which commences before and
            continues after the lender obtains a security interest
            in the property so long as the lender does not actively
            and directly contribute to the hazardous substance
            release.
      (b) Fiduciary Environmental Liability.--
              (1) In general.--Notwithstanding any other provision
            or rule of Federal law, no fiduciary, acting as defined
            in this section, shall be liable pursuant to any
            Federal environmental law, except as provided in this
            section.
              (2) Liability of fiduciary.--
                      (A) Subject to subparagraphs (B) and (C), a
                    fiduciary holding title to property or
                    otherwise affiliated with property solely in a
                    fiduciary capacity shall be personally subject
                    to the obligations and liabilities of any
                    person under any Federal environmental law, to
                    the same extent as if the property were held by
                    the fiduciary free of trust.
                      (B) The personal obligations and liabilities
                    of a fiduciary referred to in subparagraph (A)
                    shall be limited to the extent to which the
                    assets of the trust or estate are sufficient to
                    indemnify the fiduciary, unless--
                              (i) the obligations and liabilities
                            would have arisen even if the person
                            had not served as a fiduciary;
                              (ii) the fiduciary's own failure to
                            exercise due care with respect to
                            property caused or contributed to the
                            release of hazardous substances
                            following establishment of the trust,
                            estate, or fiduciary relationship; or
                              (iii) the fiduciary had a role in
                            establishing the trust, estate, or
                            fiduciary relationship, and such trust,
                            estate, or fiduciary relationship has
                            no objectively reasonable or
                            substantial purpose apart from the
                            avoidance or limitation of liability
                            under an environmental law.
                    Nothing in the preceding sentence shall be
                    construed as requiring indemnification by an
                    employee benefit plan (within the meaning of
                    paragraph (3) of section 3 of Employee
                    Retirement Income Security Act of 1974), or by
                    any trust forming a part thereof, of any
                    fiduciary of such plan contrary to the terms of
                    the plan or in an amount in excess of the
                    amount permitted under the terms of such plan.
                      (C) A fiduciary shall not be personally
                    liable for undertaking or directing another to
                    undertake a response action.
              (3) Rule of construction.--No provision of this
            subsection shall be construed as affecting the
            liability, if any, of any person who--
                      (A)(i) acts in a capacity other than a
                    fiduciary capacity; and
                      (ii) directly or indirectly benefits from a
                    trust or fiduciary relationship; or
                      (B)(i) is a beneficiary and a fiduciary with
                    respect to the same fiduciary estate; and
                      (ii) as a fiduciary, receives benefits that
                    exceed customary or reasonable compensation,
                    and incidental benefits, permitted under other
                    applicable laws.
      (c) Definitions.--For purposes of subsections (a) and (b),
    the following definitions shall apply:
              (1) Federal environmental law.--The term ``Federal
            environmental law'' means any Federal statute or rule
            of common law with the purpose of protection of the
            environment and any Federal regulation promulgated
            thereunder and any State statute or regulation created
            as a federally approved or delegated program
            implementing these laws, including the following:
                      (A) The Federal Insecticide, Fungicide, and
                    Rodenticide Act (7 U.S.C. 136 et seq.).
                      (B) The Toxic Substances Control Act (15
                    U.S.C. 2601 et seq.).
                      (C) The Federal Water Pollution Control Act
                    (33 U.S.C. 1251 et seq.).
                      (D) The Oil Pollution Act of 1990 (33 U.S.C.
                    2701 et seq.).
                      (E) The Clean Air Act (42 U.S.C. 7401 et
                    seq.).
                      (F) The Solid Waste Disposal Act (42 U.S.C.
                    6901 et seq.).
                      (G) The Comprehensive Environmental Response,
                    Compensation, and Liability Act of 1980 (42
                    U.S.C. 9601 et seq.).
                      (H) The Pollution Prevention Act of 1990 (42
                    U.S.C. 13101 et seq.).
              (2) Extension of credit.--The term ``extension of
            credit'' means the making or renewal of any loan, a
            granting of a line of credit or extending credit in any
            manner, such as an advance by means of an overdraft or
            the issuance of a standby letter of credit, and a lease
            finance transaction--
                      (A) in which the lessor does not initially
                    select the leased property and does not, during
                    the lease term, control the daily operation or
                    maintenance of the property; or
                      (B) that conforms with regulations issued by
                    the appropriate Federal banking agency or the
                    appropriate State bank supervisory (as these
                    terms are defined in section 3 of the Federal
                    Deposit Insurance Act or with regulations
                    issued by the National Credit Union
                    Administration Board, as appropriate.
              (3) Fiduciary.--The term ``fiduciary'' means a person
            who acts for the exclusive benefit of another person as
            a bona fide fiduciary within the meaning of section
            3(21) of the Employee Retirement Income Security Act of
            1974, trustee, executor, administrator, custodian,
            guardian, conservator, receiver, committee of estates
            of lunatics or other disabled persons, or personal
            representative; except, that the term ``fiduciary''
            does not include any person--
                      (A) who owns, or controls, is affiliated
                    with, or takes any action with respect to
                    property on behalf of or for the benefit of a
                    lender or takes any action to protect a
                    lender's extension of credit or security
                    interest (any such person shall be treated as a
                    lender under subsection (a) of this section);
                    or
                      (B) who is acting as a fiduciary with respect
                    to a trust or other fiduciary estate that--
                              (i) was not created as part of, or to
                            facilitate, one or more estate plans or
                            pursuant to the incapacity of a natural
                            person; and
                              (ii) was organized for the primary
                            purpose of, or is engaged in, actively
                            carrying on a trade or business for
                            profit.
              (4) Financial or administrative aspect.--The term
            ``financial or administrative aspect'' means a function
            such as a credit manager, accounts payable officer,
            accounts receivable officer, personnel manager,
            comptroller, or chief financial officer, or any similar
            function.
              (5) Foreclosure, foreclose.--The terms
            ``foreclosure'' and ``foreclose'' means, respectively,
            acquiring, and to acquire, property through--
                      (A) purchase at sale under a judgment or
                    decree, a power of sale, a nonjudicial
                    foreclosure sale, or from a trustee, deed in
                    lieu of foreclosure, or similar conveyance, or
                    through repossession, if such property was
                    security for an extension of credit previously
                    contracted;
                      (B) conveyance pursuant to an extension of
                    credit previously contracted, including the
                    termination of a lease agreement; or
                      (C) any other formal or informal manner by
                    which the person acquires, for subsequent
                    disposition, possession of collateral in order
                    to protect the security interest of the person.
              (6) Hazardous substance.--The term ``hazardous
            substance'' means any chemical, biological, organic,
            inorganic, or radioactive pollutants, contaminants,
            materials, waste, or other substances regulated under,
            defined, listed, or included in any Federal
            environmental law.
              (7) Lender.--The term ``lender'' means--
                      (A) a person that makes a bona fide extension
                    of credit to or takes a security interest from
                    another person and includes a successor or
                    assign of the person which makes the extension
                    of credit or takes the security interest;
                      (B) the Federal National Mortgage
                    Association, the Federal Home Loan Mortgage
                    Corporation, the Federal Agricultural Mortgage
                    Corporation, or other entity that in a bona
                    fide manner is engaged in the business of
                    buying or selling loans on interests therein;
                      (C) any person engaged in the business of
                    insuring or guaranteeing against a default in
                    the repayment of an extension of credit, or
                    acting as a surety with respect to an extension
                    of credit, to other persons; or
                      (D) any person regularly engaged in the
                    business of providing title insurance who
                    acquires property as a result of assignment or
                    conveyance in the course of underwriting claims
                    and claims settlement.
              (8) Operational aspect.--The term ``operational
            aspect'' means a function such as a facility or plant
            manager, operations manager, chief operating officer,
            or chief executive officer.
              (9) Person.--The term ``person'' means an individual,
            firm, corporation, association, partnership,
            consortium, joint venture, commercial entity, United
            States Government, State, municipality, commission,
            political subdivision of a State, or any interstate
            body.
              (10) Property.--The term ``property'' means real,
            personal, and mixed property.
              (11) Response action.--The term ``response action''
            shall have the same meaning as that term is defined in
            section 101 of the Comprehensive Environmental
            Response, Compensation and Liability Act.
              (12) Security interest.--The term ``security
            interest'' means a right under a mortgage, deed of
            trust, assignment, judgment lien, pledge, security
            agreement, factoring agreement, or lease, or any other
            right accruing to a person to secure the repayment of
            money, the performance of a duty, or some other
            obligation.
      (d) Savings Clause.--Nothing in subsections (a) (b), or (c),
    shall--
              (1) affect the rights or immunities or other defenses
            that are already available to lenders or fiduciaries
            under any Federal environmental law;
              (2) be construed to create any liability for any
            lender or fiduciary; or
              (3) create a private right of action against any
            lender or fiduciary.
      (e) Federal Banking and Lending Agency Environmental
    Liability.--
              (1) Governmental entities.--
                      (A) Banking and lending agencies.--Except as
                    provided in paragraph (C), a Federal banking or
                    lending agency shall not be liable under any
                    law imposing strict liability for the release
                    or threatened release of petroleum or a
                    hazardous substance at or from property
                    (including any right or interest therein)
                    acquired--
                              (i) in connection with the exercise
                            of receivership or conservatorship
                            authority, or the liquidation or
                            winding up of the affairs of an insured
                            depository institution, including any
                            of its subsidiaries, and bridge bank;
                              (ii) in connection with the provision
                            of loans, discounts, advances,
                            guarantees, insurance, or other
                            financial assistance; or
                              (iii) in connection with property
                            received in any civil or criminal
                            proceeding, or administrative
                            enforcement action, whether by
                            settlement or order.
                      (B) Application of state law.--Nothing in
                    paragraph (e) shall be construed as preempting,
                    affecting, applying to, or modifying any State
                    law, or any rights, actions, cause of action,
                    or obligations under State law, except that
                    liability under State law shall not exceed the
                    value of the agency's interest in the asset
                    giving rise to such liability. Nothing in this
                    section shall be construed to prevent a Federal
                    banking or lending agency from agreeing with a
                    State to transfer property to such State in
                    lieu of any liability that might otherwise be
                    imposed under State law.
                      (C) Limitation.--Notwithstanding paragraph
                    (A), and subject to section 107(d) of the
                    Comprehensive Environmental Response,
                    Compensation, and Liability Act of 1980, a
                    Federal banking or lending agency that directly
                    caused or materially contributed to the release
                    of petroleum or a hazardous substance may be
                    liable for removal, remedial, or other response
                    action pertaining to that release.
                      (D) Subsequent purchaser.--The immunity
                    provided by paragraphs (A) and (B) shall extend
                    to the first subsequent purchaser of property
                    described in such paragraph from a Federal
                    banking or lending agency, unless such
                    purchaser--
                              (i) would otherwise be liable or
                            potentially liable for all or part of
                            the costs of the removal, remedial, or
                            other response action due to a prior
                            relationship with the property;
                              (ii) is or was affiliated with or
                            related to a party described in
                            subparagraph (i);
                              (iii) fails to agree to take
                            reasonable steps necessary to abate the
                            release or threatened release or to
                            protect public health and safety in a
                            manner consistent with the purposes of
                            applicable Federal environmental laws;
                            or
                              (iv) directly causes or significantly
                            and materially contributes to any
                            additional release or threatened
                            release on the property.
                      (E) Federal or state action.--Notwithstanding
                    subparagraph (D), if a Federal agency or State
                    environmental agency is required to take
                    remedial action due to the failure of a
                    subsequent purchaser to carry out, in good
                    faith, the agreement described in subparagraph
                    (D)(iii), such subsequent purchaser shall
                    reimburse the Federal or State environmental
                    agency for the costs of such remedial action.
                    Any such reimbursement shall not exceed the
                    increase in the fair market value of the
                    property attributable to the remedial action.
              (2) Lien exemption.--Notwithstanding any other
            provision of law, any property held by a subsequent
            purchaser referred to in paragraph (1)(D) or held by a
            Federal banking or lending agency shall not be subject
            to any lien for costs or damages associated with the
            release or threatened release of petroleum or a
            hazardous substance existing at the time of the
            transfer.
              (3) Exemption from covenants to remediate.--A Federal
            banking or lending agency shall be exempt from any law
            requiring such agency to grant covenants warranting
            that a removal, remedial, or other response action has
            been, or will in the future be, taken with respect to
            property acquired in the manner described in paragraph
            (e)(1)(A).
              (4) Definitions.--For purposes of subsection (e), the
            following definitions shall apply:
                      (A) Federal banking or lending agency.--The
                    term ``Federal banking or lending agency''
                    means the Corporation, the Resolution Trust
                    Corporation, the Board of Governors of the
                    Federal Reserve System, the Comptroller of the
                    Currency, the Office of Thrift Supervision, a
                    Federal Reserve Bank, a Federal Home Loan Bank,
                    the Department of Housing and Urban
                    Development, the National Credit Union
                    Administration Board, the Farm Credit
                    Administration, the Farm Credit System
                    Insurance Corporation, the Farm Credit System
                    Assistance Board, the Farmers Home
                    Administration, the Rural Electrification
                    Administration, the Small Business
                    Administration, and any other Federal agency
                    acting in a similar capacity, in any of their
                    capacities, and their agents or appointees.
                      (B) Hazardous substance.--The term
                    ``hazardous substance'' has the same meaning as
                    in section 101(14) of the Comprehensive
                    Environmental Response, Compensation, and
                    Liability Act of 1980.
                      (C) Release.--The term ``release'' has the
                    same meaning as in section 101(22) of the
                    Comprehensive Environmental Response,
                    Compensation, and Liability Act of 1980, and
                    includes the use, storage, disposal, treatment,
                    generation, or transportation of a hazardous
                    substance.
              (5) Savings clause.--Nothing in subsection (e)
            shall--
                      (A) affect the rights or immunities or other
                    defenses that are available under this Act or
                    other applicable law to any party, subject to
                    the provisions of this section;
                      (B) be construed to create any liability for
                    any party; or
                      (C) create a private right of action against
                    an insured depository institution or lender or
                    against a Federal banking or lending agency.
                                  ----------

                              TRUTH IN SAVINGS ACT

                          Subtitle F--Truth in Savings

    SEC. 261. SHORT TITLE.

      This subtitle may be cited as the ``Truth in Savings Act''.

    [SEC. 262. FINDINGS AND PURPOSE.

      [(a) Findings.--The Congress hereby finds that economic
    stability would be enhanced, competition between depository
    institutions would be improved, and the ability of the consumer
    to make informed decisions regarding deposit accounts, and to
    verify accounts, would be strengthened if there was uniformity
    in the disclosure of terms and conditions on which interest is
    paid and fees are assessed in connection with such accounts.
      [(b) Purpose.--It is the purpose of this subtitle to require
    the clear and uniform disclosure of--
              [(1) the rates of interest which are payable on
            deposit accounts by depository institutions; and
              [(2) the fees that are assessable against deposit
            accounts,
    so that consumers can make a meaningful comparison between the
    competing claims of depository institutions with regard to
    deposit accounts.

    [SEC. 263. DISCLOSURE OF INTEREST RATES AND TERMS OF ACCOUNTS.

      [(a) In General.--Except as provided in subsections (b) and
    (c), each advertisement, announcement, or solicitation
    initiated by any depository institution or deposit broker
    relating to any demand or interest-bearing account offered by
    an insured depository institution which includes any reference
    to a specific rate of interest payable on amounts deposited in
    such account, or to a specific yield or rate of earnings on
    amounts so deposited, shall state the following information, to
    the extent applicable, in a clear and conspicuous manner:
              [(1) The annual percentage yield.
              [(2) The period during which such annual percentage
            yield is in effect.
              [(3) All minimum account balance and time
            requirements which must be met in order to earn the
            advertised yield (and, in the case of accounts for
            which more than 1 yield is stated, each annual
            percentage yield and the account minimum balance
            requirement associated with each such yield shall be in
            close proximity and have equal prominence).
              [(4) The minimum amount of the initial deposit which
            is required to open the account in order to obtain the
            yield advertised, if such minimum amount is greater
            than the minimum balance necessary to earn the
            advertised yield.
              [(5) A statement that regular fees or other
            conditions could reduce the yield.
              [(6) A statement that an interest penalty is required
            for early withdrawal.
      [(b) Broadcast and Electronic Media and Outdoor Advertising
    Exception.--The Board may, by regulation, exempt
    advertisements, announcements, or solicitations made by any
    broadcast or electronic medium or outdoor advertising display
    not on the premises of the depository institution from any
    disclosure requirements described in paragraph (4) or (5) of
    subsection (a) if the Board finds that any such disclosure
    would be unnecessarily burdensome.
      [(c) Disclosure Required for On-Premises Displays.--
              [(1) In general.--The disclosure requirements
            contained in this section shall not apply to any sign
            (including a rate board) disclosing a rate or rates of
            interest which is displayed on the premises of the
            depository institution if such sign contains--
                      [(A) the accompanying annual percentage
                    yield; and
                      [(B) a statement that the consumer should
                    request further information from an employee of
                    the depository institution concerning the fees
                    and terms applicable to the advertised account.
              [(2) Definition.--For purposes of paragraph (1), a
            sign shall only be considered to be displayed on the
            premises of a depository institution if the sign is
            designed to be viewed only from the interior of the
            premises of the depository institution.
      [(d) Misleading Descriptions of Free or No-Cost Accounts
    Prohibited.--No advertisement, announcement, or solicitation
    made by any depository institution or deposit broker may refer
    to or describe an account as a free or no-cost account (or
    words of similar meaning) if--
              [(1) in order to avoid fees or service charges for
            any period--
                      [(A) a minimum balance must be maintained in
                    the account during such period; or
                      [(B) the number of transactions during such
                    period may not exceed a maximum number; or
              [(2) any regular service or transaction fee is
            imposed.
      [(e) Misleading or Inaccurate Advertisements, Etc.,
    Prohibited.--No depository institution or deposit broker shall
    make any advertisement, announcement, or solicitation relating
    to a deposit account that is inaccurate or misleading or that
    misrepresents its deposit contracts.

    [SEC. 264. ACCOUNT SCHEDULE.

      [(a) In General.--Each depository institution shall maintain
    a schedule of fees, charges, interest rates, and terms and
    conditions applicable to each class of accounts offered by the
    depository institution, in accordance with the requirements of
    this section and regulations which the Board shall prescribe.
    The Board shall specify, in regulations, which fees, charges,
    penalties, terms, conditions, and account restrictions must be
    included in a schedule required under this subsection. A
    depository institution need not include in such schedule any
    information not specified in such regulation.
      [(b) Information on Fees and Charges.--The schedule required
    under subsection (a) with respect to any account shall contain
    the following information:
              [(1) A description of all fees, periodic service
            charges, and penalties which may be charged or assessed
            against the account (or against the account holder in
            connection with such account), the amount of any such
            fees, charge, or penalty (or the method by which such
            amount will be calculated), and the conditions under
            which any such amount will be assessed.
              [(2) All minimum balance requirements that affect
            fees, charges, and penalties, including a clear
            description of how each such minimum balance is
            calculated.
              [(3) Any minimum amount required with respect to the
            initial deposit in order to open the account.
      [(c) Information on Interest Rates.--The schedule required
    under subsection (a) with respect to any account shall include
    the following information:
              [(1) Any annual percentage yield.
              [(2) The period during which any such annual
            percentage yield will be in effect.
              [(3) Any annual rate of simple interest.
              [(4) The frequency with which interest will be
            compounded and credited.
              [(5) A clear description of the method used to
            determine the balance on which interest is paid.
              [(6) The information described in paragraphs (1)
            through (4) with respect to any period after the end of
            the period referred to in paragraph (2) (or the method
            for computing any information described in any such
            paragraph), if applicable.
              [(7) Any minimum balance which must be maintained to
            earn the rates and obtain the yields disclosed pursuant
            to this subsection and a clear description of how any
            such minimum balance is calculated.
              [(8) A clear description of any minimum time
            requirement which must be met in order to obtain the
            yields disclosed pursuant to this subsection and any
            information described in paragraph (1), (2), (3), or
            (4) that will apply if any time requirement is not met.
              [(9) A statement, if applicable, that any interest
            which has accrued but has not been credited to an
            account at the time of a withdrawal from the account
            will not be paid by the depository institution or
            credited to the account by reason of such withdrawal.
              [(10) Any provision or requirement relating to
            nonpayment of interest, including any charge or penalty
            for early withdrawal, and the conditions under which
            any such charge or penalty may be assessed.
      [(d) Other Information.--The schedule required under
    subsection (a) shall include such other disclosures as the
    Board may determine to be necessary to allow consumers to
    understand and compare accounts, including frequency of
    interest rate adjustments, account restrictions, and renewal
    policies for time accounts.
      [(e) Style and Format.--Schedules required under subsection
    (a) shall be written in clear and plain language and be
    presented in a format designed to allow consumers to readily
    understand the terms of the accounts offered.

    [SEC. 265. DISCLOSURE REQUIREMENTS FOR CERTAIN ACCOUNTS.

      [The Board shall require, in regulations which the Board
    shall prescribe, such modification in the disclosure
    requirements under this Act relating to annual percentage yield
    as may be necessary to carry out the purposes of this Act in
    the case of--
              [(1) accounts with respect to which determination of
            annual percentage yield is based on an annual rate of
            interest that is guaranteed for a period of less than 1
            year;
              [(2) variable rate accounts;
              [(3) accounts which, pursuant to law, do not
            guarantee payment of a stated rate;
              [(4) multiple rate accounts; and
              [(5) accounts with respect to which determination of
            annual percentage yield is based on an annual rate of
            interest that is guaranteed for a stated term.

    [SEC. 266. DISTRIBUTION OF SCHEDULES.

      [(a) In General.--A schedule required under section 264 for
    an appropriate account shall be--
              [(1) made available to any person upon request;
              [(2) provided to any potential customer before an
            account is opened or a service is rendered; and
              [(3) provided to the depositor, in the case of any
            time deposit which is renewable at maturity without
            notice from the depositor, at least 30 days before the
            date of maturity.
      [(b) Distribution in Case of Certain Initial Deposits.--If--
              [(1) a depositor is not physically present at an
            office of a depository institution at the time an
            initial deposit is accepted with respect to an account
            established by or for such person; and
              [(2) the schedule required under section 264(a) has
            not been furnished previously to such depositor,
    the depository institution shall mail the schedule to the
    depositor at the address shown on the records of the depository
    institution for such account no later than 10 days after the
    date of the initial deposit.
      [(c) Distribution of Notice of Certain Changes.--If--
              [(1) any change is made in any term or condition
            which is required to be disclosed in the schedule
            required under section 264(a) with respect to any
            account; and
              [(2) the change may reduce the yield or adversely
            affect any holder of the account,
    all account holders who may be affected by such change shall be
    notified and provided with a description of the change by mail
    at least 30 days before the change takes effect.
      [(d) Distribution in Case of Accounts Established by More
    Than 1 Individual or by a Group.--If an account is established
    by more than 1 individual or for a person other than an
    individual, any distribution described in this section with
    respect to such account meets the requirements of this section
    if the distribution is made to 1 of the individuals who
    established the account or 1 individual representative of the
    person on whose behalf such account was established.
      [(e) Notice to Account Holders as of the Effective Date of
    Regulations.--For any account for which the depository
    institution delivers an account statement on a quarterly or
    more frequent basis, the depository institution shall include
    on or with any regularly scheduled mailing posted or delivered
    within 180 days after publication of regulations issued by the
    Board in final form, a statement that the account holder has
    the right to request an account schedule containing the terms,
    charges, and interest rates of the account, and that the
    account holder may wish to request such an account schedule.]
    SEC. 262. PURPOSE.

      It is the purpose of this subtitle to ensure that consumers
    can make a meaningful comparison between the competing claims
    of depository institutions with regard to deposit accounts by
    requiring that institutions offering interest-bearing accounts
    pay interest on the full amount of principal each day in a
    consumer deposit account at the rate agreed to be paid by the
    institution.

    SEC. 263. PROHIBITION ON MISLEADING OR INACCURATE ADVERTISEMENTS AND
                        DISCLOSURES.

      No depository institution or deposit broker shall make any
    advertisement, announcement, solicitation or disclosure
    relating to a deposit account that is inaccurate or misleading,
    including any inaccurate or misleading description of a free or
    no-cost account, or that misrepresents its deposit contracts.

    SEC. 264. ACCOUNT INFORMATION.

      (a) In General.--Each depository institution shall disclose
    fees, charges, penalties, and interest rates applicable to each
    class of accounts offered by the institution in accordance with
    this section.
      (b) Information on Fees and Charges.--Each depository
    institution shall disclose the following information with
    respect to any account to a consumer at the time the account is
    opened, or at such earlier time as a consumer may request (and
    no additional information may be required to be disclosed under
    this subtitle by regulation or otherwise with respect to such
    account):
              (1) A description of all fees, periodic service
            charges, penalties, and interest rates which may be
            charged or assessed against the account (or against the
            account holder in connection with such account), the
            amount of any such fees, charges, or penalties (or the
            method by which such amount will be calculated), and
            the conditions under which any such amount will be
            assessed.
              (2) All minimum balance requirements that affect
            fees, charges, and penalties, including a clear
            description of how each such minimum balance is
            calculated.
              (3) Any minimum amount required with respect to the
            initial deposit in order to open the account.
      (c) Information on Interest Rates.--The disclosures required
    under subsections (a) and (b) with respect to any account shall
    include the following information:
              (1) Any annual rate of simple interest.
              (2) The frequency with which interest will be
            compounded and credited.
      (d) No Regulations Authorized.--No regulations may be
    prescribed with respect to this section by the Board or any
    agency referred to in this title, including any regulation to
    define any terms used in this section.

    SEC. 265. DISCLOSURE OF CHANGE IN TERMS.

      If any change is made in any item required to be disclosed
    under section 264, all account holders who may be affected by
    such change shall be notified by mail and provided with a
    description of such change at least 30 days before the
    effective date of the change.
    SEC. [267.] 266. PAYMENT OF INTEREST.

      (a) Calculated on Full Amount of Principal.--Interest on an
    interest-bearing account at any depository institution shall be
    calculated by such institution on the full amount of principal
    in the account for each day of the stated calculation period at
    the rate or rates of interest disclosed pursuant to this Act.
      (b) No Particular Method of Compounding Interest Required.--
    Subsection (a) shall not be construed as prohibiting or
    requiring the use of any particular method of compounding or
    crediting of interest.
      (c) Date by Which Interest Must Accrue.--Interest on accounts
    that are subject to this Act shall begin to accrue not later
    than the business day specified for interest-bearing accounts
    in section 606 of the Expedited Funds Availability Act, subject
    to subsections (b) and (c) of such section.

    [SEC. 268. PERIODIC STATEMENTS.

      [Each depository institution shall include on or with each
    periodic statement provided to each account holder at such
    institution a clear and conspicuous disclosure of the following
    information with respect to such account:
              [(1) The annual percentage yield earned.
              [(2) The amount of interest earned.
              [(3) The amount of any fees or charges imposed.
              [(4) The number of days in the reporting period.
    [SEC. 269. REGULATIONS.

      [(a) In General.--
              [(1) Regulations required.--Before the end of the 9-
            month period beginning on the date of the enactment of
            this Act, the Board, after consultation with each
            agency referred to in section 270(a) and public notice
            and opportunity for comment, shall prescribe
            regulations to carry out the purpose and provisions of
            this Act.
              [(2) Effective date of regulations.--The regulations
            prescribed under paragraph (1) shall take effect not
            later than 9 months after publication in final form.
              [(3) Contents of regulations.--The regulations
            prescribed under paragraph (1) may contain such
            classifications, differentiations, or other provisions,
            and may provide for such adjustments and exceptions for
            any class of accounts as, in the judgment of the Board,
            are necessary or proper to carry out the purposes of
            this Act, to prevent circumvention or evasion of the
            requirements of this Act, or to facilitate compliance
            with the requirements of this Act.
              [(4) Date of applicability.--The provisions of this
            Act shall not apply with respect to any depository
            institution before the effective date of regulations
            prescribed by the Board under this subsection (or by
            the National Credit Union Administration Board under
            section 12(b), in the case of any depository
            institution described in clause (iv) of section
            19(b)(1)(A) of the Federal Reserve Act).
      [(b) Model Forms and Clauses.--
              [(1) In general.--The Board shall publish model forms
            and clauses for common disclosures to facilitate
            compliance with this Act. In devising such forms, the
            Board shall consider the use by depository institutions
            of data processing or similar automated machines.
              [(2) Use of forms and clauses deemed in compliance.--
            Nothing in this Act may be construed to require a
            depository institution to use any such model form or
            clause prescribed by the Board under this subsection. A
            depository institution shall be deemed to be in
            compliance with the disclosure provisions of this Act
            if the depository institution--
                      [(A) uses any appropriate model form or
                    clause as published by the Board; or
                      [(B) uses any such model form or clause and
                    changes it by--
                              [(i) deleting any information which
                            is not required by this Act; or
                              [(ii) rearranging the format,
                    if in making such deletion or rearranging the
                    format, the depository institution does not
                    affect the substance, clarity, or meaningful
                    sequence of the disclosure.
              [(3) Public notice and opportunity for comment.--
            Model disclosure forms and clauses shall be adopted by
            the Board after duly given notice in the Federal
            Register and an opportunity for public comment in
            accordance with section 553 of title 5, United States
            Code.]
    SEC. 267. REGULATIONS.

      (a) In General.--The Board, after consultation with each
    agency referred to in section 265(a) and public notice and
    opportunity for comment, shall prescribe regulations to carry
    out the purpose and provisions of this subtitle.
      (b) Effective Date of Regulations.--The provisions of this
    subtitle shall not apply with respect to any depository
    institution before the effective date of regulations prescribed
    by the Board under this subsection.
    SEC. [270.] 268. ADMINISTRATIVE ENFORCEMENT.

      (a) In General.--Compliance with the requirements imposed
    under this Act shall be enforced under--
              (1) section 8 of the Federal Deposit Insurance Act--
                      (A) by the appropriate Federal banking agency
                    (as defined in section 3(q) of the Federal
                    Deposit Insurance Act) in the case of insured
                    depository institutions (as defined in section
                    3(c)(2) of such Act);
                      (B) by the Federal Deposit Insurance
                    Corporation in the case of depository
                    institutions described in clause (i), (ii), or
                    (iii) of section 19(b)(1)(A) of the Federal
                    Reserve Act which are not insured depository
                    institutions (as defined in section 3(c)(2) of
                    the Federal Deposit Insurance Act); and
                      (C) by the Director of the Office of Thrift
                    Supervision in the case of depository
                    institutions described in clause (v) and or
                    (vi) of section 19(b)(1)(A) of the Federal
                    Reserve Act which are not insured depository
                    institutions (as defined in section 3(c)(2) of
                    the Federal Deposit Insurance Act); and
              (2) the Federal Credit Union Act, by the National
            Credit Union Administration Board in the case of
            depository institutions described in clause (iv) of
            section 19(b)(1)(A) of the Federal Reserve Act.
      (b) Additional Enforcement Powers.--
              (1) Violation of this act treated as violation of
            other acts.--For purposes of the exercise by any agency
            referred to in subsection (a) of such agency's powers
            under any Act referred to in such subsection, a
            violation of a requirement imposed under this Act shall
            be deemed to be a violation of a requirement imposed
            under that Act.
              (2) Enforcement authority under other acts.--In
            addition to the powers of any agency referred to in
            subsection (a) under any provision of law specifically
            referred to in such subsection, each such agency may
            exercise, for purposes of enforcing compliance with any
            requirement imposed under this Act, any other authority
            conferred on such agency by law.
      (c) Regulations by Agencies Other Than the Board.--The
    authority of the Board to issue regulations under this Act does
    not impair the authority of any other agency referred to in
    subsection (a) to make rules regarding its own procedures in
    enforcing compliance with the requirements imposed under this
    Act.

    [SEC. 271. CIVIL LIABILITY.

      [(a) Civil Liability.--Except as otherwise provided in this
    section, any depository institution which fails to comply with
    any requirement imposed under this Act or any regulation
    prescribed under this Act with respect to any person who is an
    account holder is liable to such person in an amount equal to
    the sum of--
              [(1) any actual damage sustained by such person as a
            result of the failure;
              [(2)(A) in the case of an individual action, such
            additional amount as the court may allow, except that
            the liability under this subparagraph shall not be less
            than $100 nor greater than $1,000; or
              [(B) in the case of a class action, such amount as
            the court may allow, except that--
                      [(i) as to each member of the class, no
                    minimum recovery shall be applicable; and
                      [(ii) the total recovery under this
                    subparagraph in any class action or series of
                    class actions arising out of the same failure
                    to comply by the same depository institution
                    shall not be more than the lesser of $500,000
                    or 1 percent of the net worth of the depository
                    institution involved; and
              [(3) in the case of any successful action to enforce
            any liability under paragraph (1) or (2), the costs of
            the action, together with a reasonable attorney's fee
            as determined by the court.
      [(b) Class Action Awards.--In determining the amount of any
    award in any class action, the court shall consider, among
    other relevant factors--
              [(1) the amount of any actual damages awarded;
              [(2) the frequency and persistence of failures of
            compliance;
              [(3) the resources of the depository institution;
              [(4) the number of persons adversely affected; and
              [(5) the extent to which the failure of compliance
            was intentional.
      [(c) Bona Fide Errors.--
              [(1) General rule.--A depository institution may not
            be held liable in any action brought under this section
            for a violation of this Act if the depository
            institution demonstrates by a preponderance of the
            evidence that the violation was not intentional and
            resulted from a bona fide error, notwithstanding the
            maintenance of procedures reasonably adapted to avoid
            any such error.
              [(2) Examples.--Examples of a bona fide error include
            clerical, calculation, computer malfunction and
            programming, and printing errors, except that an error
            of legal judgment with respect to a depository
            institution's obligation under this Act is not a bona
            fide error.
      [(d) No Liability for Overpayment.--A depository institution
    may not be held liable in any action under this section for a
    violation of this Act if the violation has resulted in--
              [(1) an interest payment to the account holder in an
            amount greater than the amount determined under any
            disclosed rate of interest applicable with respect to
            such payment; or
              [(2) a charge to the consumer in an amount less than
            the amount determined under the disclosed charge or fee
            schedule applicable with respect to such charge.
      [(e) Jurisdiction.--Any action under this section may be
    brought in any United States district court, or in any other
    court of competent jurisdiction, within 1 year after the date
    of the occurrence of the violation involved.
      [(f) Reliance on Board Rulings.--No provision of this section
    imposing any liability shall apply to any act done or omitted
    in good faith in conformity with any regulation or order, or
    any interpretation of any regulation or order, of the Board, or
    in conformity with any interpretation or approval by an
    official or employee of the Board duly authorized by the Board
    to issue such interpretation or approval under procedures
    prescribed by the Board, notwithstanding, the fact that after
    such act or omission has occurred, such regulation, order,
    interpretation, or approval is amended, rescinded, or
    determined by judicial or other authority to be invalid for any
    reason.
      [(g) Notification of and Adjustment for Errors.--A depository
    institution shall not be liable under this section or section
    270 for any failure to comply with any requirement imposed
    under this Act with respect to any account if--
              [(1) before--
                      [(A) the end of the 60-day period beginning
                    on the date on which the depository institution
                    discovered the failure to comply;
                      [(B) any action is instituted against the
                    depository institution by the account holder
                    under this section with respect to such failure
                    to comply; and
                      [(C) any written notice of such failure to
                    comply is received by the depository
                    institution from the account holder,
            the depository institution notifies the account holder
            of the failure of such institution to comply with such
            requirement; and
              [(2) the depository institution makes such
            adjustments as may be necessary with respect to such
            account to ensure that--
                      [(A) the account holder will not be liable
                    for any amount in excess of the amount actually
                    disclosed with respect to any fee or charge;
                      [(B) the account holder will not be liable
                    for any fee or charge imposed under any
                    condition not actually disclosed; and
                      [(C) interest on amounts in such account will
                    accrue at the annual percentage yield, and
                    under the conditions, actually disclosed (and
                    credit will be provided for interest already
                    accrued at a different annual percentage yield
                    and under different conditions than the yield
                    or conditions disclosed).
      [(h) Multiple Interests in 1 Account.--If more than 1 person
    holds an interest in any account--
              [(1) the minimum and maximum amounts of liability
            under subsection (a)(2)(A) for any failure to comply
            with the requirements of this Act shall apply with
            respect to such account; and
              [(2) the court shall determine the manner in which
            the amount of any such liability with respect to such
            account shall be distributed among such persons.
      [(i) Continuing Failure to Disclose.--
              [(1) Certain continuing failures treated as 1
            violation.--Except as provided in paragraph (2), the
            continuing failure of any depository institution to
            disclose any particular term required to be disclosed
            under this Act with respect to a particular account
            shall be treated as a single violation for purposes of
            determining the amount of any liability of such
            institution under subsection (a) for such failure to
            disclose.
              [(2) Subsequent failure to disclose.--The continuing
            failure of any depository institution to disclose any
            particular term required to be disclosed under this Act
            with respect to a particular account after judgment has
            been rendered in favor of the account holder in
            connection with a prior failure to disclose such term
            with respect to such account shall be treated as a
            subsequent violation for purposes of determining
            liability under subsection (a).
              [(3) Coordination with section 270.--This subsection
            shall not limit or otherwise affect the enforcement
            power under section 270 of any agency referred to in
            subsection (a) of such section.]

    SEC. [272.] 269. CREDIT UNIONS.

      (a) In General.--No regulation prescribed by the Board under
    this Act shall apply directly with respect to any depository
    institution described in clause (iv) of section 19(b)(1)(A) of
    the Federal Reserve Act.
      (b) Regulations Prescribed by the NCUA.--Within 90 days of
    the effective date of any regulation prescribed by the Board
    under this Act, the National Credit Union Administration Board
    shall prescribe a regulation substantially similar to the
    regulation prescribed by the Board taking into account the
    unique nature of credit unions and the limitations under which
    they may pay dividends on member accounts.

    [SEC. 273. EFFECT ON STATE LAW.

      [The provisions of this Act do not supersede any provisions
    of the law of any State relating to the disclosure of yields
    payable or terms for accounts to the extent such State law
    requires the disclosure of such yields or terms for accounts,
    except to the extent that those laws are inconsistent with the
    provisions of this Act, and then only to the extent of the
    inconsistency. The Board may determine whether such
    inconsistencies exist.

    [SEC. 274. DEFINITIONS.

      [For the purposes of this Act--
              [(1) Account.--The term ``account'' means any account
            intended for use by and generally used by consumers
            primarily for personal, family, or household purposes
            that is offered by a depository institution into which
            a consumer deposits funds, including demand accounts,
            time accounts, negotiable order of withdrawal accounts,
            and share draft accounts.
              [(2) Annual percentage yield.--The term ``annual
            percentage yield'' means the total amount of interest
            that would be received on a $100 deposit, based on the
            annual rate of simple interest and the frequency of
            compounding for a 365-day period, expressed as a
            percentage calculated by a method which shall be
            prescribed by the Board in regulations.
              [(3) Annual rate of simple interest.--The term
            ``annual rate of simple interest''--
                      [(A) means the annualized rate of interest
                    paid with respect to each compounding period,
                    expressed as a percentage; and
                      [(B) may be referred to as the ``annual
                    percentage rate''.
              [(4) Board.--The term ``Board'' means the Board of
            Governors of the Federal Reserve System.
              [(5) Deposit broker.--The term ``deposit broker''--
                      [(A) has the meaning given to such term in
                    section 29(f)(1) of the Federal Deposit
                    Insurance Act; and
                      [(B) includes any person who solicits any
                    amount from any other person for deposit in an
                    insured depository institution.
              [(6) Depository institution.--The term ``depository
            institution'' has the meaning given such term in
            clauses (i) through (vi) of section 19(b)(1)(A) of the
            Federal Reserve Act.
              [(7) Interest.--The term ``interest'' includes
            dividends paid with respect to share draft accounts
            which are accounts within the meaning of paragraph (3).
              [(8) Multiple rate account.--The term ``multiple rate
            account'' means any account that has 2 or more annual
            rates of simple interest which take effect at the same
            time or in succeeding periods and which are known at
            the time of disclosure.]
    SEC. 270. DEFINITIONS.

      For the purposes of this subtitle, the following definitions
    shall apply:
              (1) Accounts.--The term ``account'' means any account
            intended for use by and generally used by a consumer
            primarily for personal, family, or household purposes
            that is offered by a depository institution.
              (2) Deposit broker.--The term ``deposit broker''--
                      (A) has the meaning given to such term in
                    section 29(f)(1) of the Federal Deposit
                    Insurance Act; and
                      (B) includes any person who solicits any
                    amount from any other person for deposit in an
                    insured depository institution.
              (3) Depository institution.--The term ``depository
            institution''--
                      (A) means an institution described in clause
                    (i), (ii), (iii), (iv), (v), or (vi) of section
                    19(b)(1)(A) of the Federal Reserve Act; and
                      (B) does not include nonautomated credit
                    unions which were not required to comply with
                    the requirements of this title as of the date
                    of the enactment of the Financial Institutions
                    Regulatory Relief Act of 1995 pursuant to the
                    determination of the National Credit Union
                    Administration Board.
              (4) Interest.--The term ``interest'' includes
            dividends paid with respect to share accounts which are
            accounts within the meaning of paragraph (1).
              (5) Board.--The term ``Board'' means the Board of
            Governors of the Federal Reserve System.
                                  ----------

                SECTION 903 OF THE ELECTRONIC FUND TRANSFER ACT

    Sec. 903. [15 U.S.C. 1693a] Definitions

      As used in this title--
              (1) the term ``accepted card or other means of
            access'' means a card, code, or other means of access
            to a consumer's account for the purpose of initiating
            electronic fund transfers when the person to whom such
            card or other means of access was issued has requested
            and received or has signed or has used, or authorized
            another to use, such card or other means of access for
            the purpose of transferring money between accounts or
            obtaining money, property, labor, or services, but such
            term does not include a card, device, or computer that
            a person may use to pay for transactions through use of
            value stored on, or assigned to, the card, device, or
            computer itself, except for those transactions where
            such card, device, or computer is actually used to
            access an account to effect such transaction;
              (2) the term ``account'' means a demand deposit,
            savings deposit, or other asset account (other than an
            occasional or incidental credit balance in an open end
            credit plan as defined in section 103(i) of this Act),
            as described in regulations of the Board, established
            primarily for personal, family, or household purposes,
            but such term does not include an account held by a
            financial institution pursuant to a bona fide trust
            agreement and does not include any value which is
            stored on, or assigned to, a card, device, or computer
            itself that enables a person to pay for transactions
            through use of that stored value;
              * * * * * * *
                                  ----------

                          EQUAL CREDIT OPPORTUNITY ACT

                      TITLE VII--EQUAL CREDIT OPPORTUNITY
    Sec.
    701. Prohibited discrimination.
         * * * * * * *
    704A. Incentives for self-testing and self-correction.
         * * * * * * *
    Sec. 701. Prohibited discrimination; reasons for adverse action

      (a) * * *
              * * * * * * *
      (d)(1) Within thirty days (or such longer reasonable time as
    specified in regulations of the Board for any class of credit
    transaction) after receipt of a completed application for
    credit, a creditor shall notify the applicant of its action on
    the application.
      (2) Each applicant against whom adverse action is taken shall
    be entitled to a statement of reasons for such action from the
    creditor. A creditor satisfies this obligation by--
              (A) providing statements of reasons in writing as a
            matter of course to applicants against whom adverse
            action is taken; or
              [(B) giving written notification of adverse action
            which discloses (i) the applicant's right to a
            statement of reasons within thirty days after receipt
            by the creditor of a request made within sixty days
            after such notification, and (ii) the identity of the
            person or office from which such statement may be
            obtained. Such statement may be given orally, if the
            written notification advises the applicant of his right
            to have the statement of reasons confirmed in writing
            on written request.]
                      (B) giving written notification of adverse
                    action which discloses--
                              (i) the applicant's right to a
                            statement of reasons within 30 days
                            after receipt by the creditor of a
                            request made within 60 days after such
                            notification;
                              (ii) if credit is denied or the
                            charge for such credit is increased
                            either wholly or partly because of
                            information contained in a consumer
                            report from a consumer reporting
                            agency--
                                      (I) that fact and the name,
                                    address, and telephone number
                                    of the consumer reporting
                                    agency making the report;
                                      (II) the consumer's right to
                                    obtain, under section 612, a
                                    free copy of a consumer report
                                    on the consumer, from the
                                    consumer reporting agency
                                    referred to in subclause (I)
                                    within the 30-day period
                                    provided under such section;
                                    and
                                      (III) the consumer's right to
                                    dispute, under section 611,
                                    with a consumer reporting
                                    agency the accuracy or
                                    completeness of any information
                                    in a consumer report furnished
                                    by the agency.
                              (iii) if credit is denied or the
                            charge for credit is increased either
                            wholly or partly because of information
                            obtained from a person other than a
                            consumer reporting agency bearing upon
                            the consumer's credit worthiness,
                            credit standing, credit capacity,
                            character, general reputation, personal
                            characteristics or mode of living, that
                            fact and the right to receive
                            disclosure of the nature of the
                            information so received, within a
                            reasonable period of time, upon the
                            consumer's written request for
                            information within 60 days after
                            learning of such adverse action; and
                              (iv) the identity of the person or
                            office from which such notification may
                            be obtained.
                    Such statement of reasons may be given orally
                    if the written notification advises the
                    applicant of his right to have the statement of
                    reasons confirmed in writing on written
                    request.
              * * * * * * *
      (3) A statement of reasons meets the requirements of this
    section only if it contains the specific reasons for the
    adverse action taken[.] and, to the extent applicable, the name
    and address, and telephone number of the consumer reporting
    agency identified in accordance with the requirements of
    subsection (d)(3)(ii) and a statement of the right to obtain
    disclosure of the nature of the information upon which adverse
    action was taken as required by such subsection.
              * * * * * * *
    SEC. 704A. INCENTIVES FOR SELF-TESTING AND SELF-CORRECTION.

      (a) In General.--If a creditor--
              (1) conducts, or authorizes an independent third
            party to conduct, a self-test of the creditor's lending
            or any part of the creditor's lending operations in
            order to determine the level or effectiveness of
            compliance with this title by the creditor; and
              (2) has identified discriminatory practices and has
            taken or is taking appropriate corrective actions to
            address the discrimination,
    any report or results of such a self-test may not be obtained
    or used by any applicant, department, or agency in any
    proceeding or civil action brought under this title.
      (b) Results of Self-Testing.--No provision of this section
    shall be construed as preventing an applicant, department, or
    agency from obtaining and using the results of any self-testing
    in any proceeding or civil action brought under this title if--
              (1) the creditor or any other entity conducted such
            activity at the request of a department or agency;
              (2) the creditor or any other entity, or any person
            acting on behalf of the creditor or other entity--
                      (A) voluntarily releases or discloses all, or
                    any part of, such results; or
                      (B) refers to or describes such results as a
                    defense to charges of unlawful discrimination
                    against such creditor, person, or entity; or
              (3) the results are sought by the applicant,
            department, or agency by means of a discovery request
            for the purposes of determining an appropriate penalty
            or remedy for a violation of this title.
      (c) Regulations.--The appropriate Federal department or
    agency shall prescribe regulations, after notice and
    opportunity for comment, which determine what types of ``self-
    tests'' are sufficiently extensive so as to constitute a
    determination of the level or effectiveness of a creditor's
    compliance with this title.
              * * * * * * *

    Sec. 706. Civil liability

      (a) * * *
              * * * * * * *
      [(g) The agencies] (g) Referrals to the Attorney General.--
              (1) In general.--The agencies having responsibility
            for administrative enforcement under section 704, if
            unable to obtain compliance with section 701, are
            authorized to refer the matter to the Attorney General
            with a recommendation that an appropriate civil action
            be instituted. Each agency referred to in paragraphs
            (1), (2), and (3) of section 704(a) shall refer the
            matter to the Attorney General whenever the agency has
            reason to believe that 1 or more creditors has engaged
            in a pattern or practice of discouraging or denying
            applications for credit in violation of section 701(a).
            Each such agency may refer the matter to the Attorney
            General whenever the agency has reason to believe that
            1 or more creditors has violated section 701(a).
              (2) Limitation on referrals of self-testing
            results.--
                      (A) In general.--No agency shall be required
                    to refer any report or results of a self-test
                    relating to any creditor to the Attorney
                    General if the creditor--
                              (i) has already identified
                            discriminatory practices as the result
                            of self-testing instituted by the
                            creditor to determine compliance with
                            this title; and
                              (ii) has taken or is taking
                            appropriate corrective actions to
                            address the discrimination.
              (3) Enforcement under other laws.--No provision of
            this section shall be construed as limiting the
            authority of the agency to enforce the provisions of
            this Act under any other provision of law.
              * * * * * * *
      (k) Notice to HUD of Violations.--Whenever an agency referred
    to in paragraph (1), (2), or (3) of section 704(a)--
              (1) has reason to believe, as a result of receiving a
            consumer complaint, conducting a consumer compliance
            examination, or otherwise, that a violation of this
            title has occurred;
              (2) has reason to believe that the alleged violation
            would be a violation of the Fair Housing Act; and
              (3) does not refer the matter to the Attorney General
            pursuant to subsection (g),
    the agency shall notify the Secretary of Housing and Urban
    Development of the violation, and shall notify the applicant
    that the Secretary of Housing and Urban Development has been
    notified of the alleged violation and that remedies for the
    violation may be available under the Fair Housing Act. No such
    agency shall be required to notify the Secretary of Housing and
    Urban Development or the applicant that the agency has reason
    to believe that a violation of this title or the Fair Housing
    Act occurred if the reason is based on a result of self-testing
    instituted by the creditor to determine compliance with this
    title, and the creditor has already identified the possible
    violation and has taken or is taking appropriate corrective
    actions to address the possible violation. No provisions of
    this section shall be construed as limiting the authority of
    the agency to enforce the provisions of this title under any
    other provision of law.
      (l) Reasonable Procedures to Assure Compliance.--No person
    shall be held liable for any violation of subsection 701(d) if
    such person shows by a preponderance of the evidence that at
    the time of the alleged violation the person maintained
    reasonable procedures to assure compliance with the provisions
    of the subsection.
              * * * * * * *

    Sec. 709. Short title

      This title may be cited as the ``Equal Credit Opportunity
    Act''.
                                  ----------

                  SECTION 615 OF THE FAIR CREDIT REPORTING ACT

    Sec. 615. Requirements on users of consumer reports

      (a) Whenever [credit or] insurance for personal, family, or
    household purposes, or employment involving a consumer is
    denied or the charge for such [credit or] insurance is
    increased either wholly or partly because of information
    contained in a consumer report from a consumer reporting
    agency, the user of the consumer report shall so advise the
    consumer against whom such adverse action has been taken and
    supply the name and address of the consumer reporting agency
    making the report.
      [(b) Whenever credit for personal, family, or household
    purposes involving a consumer is denied or the charge for such
    credit is increased either wholly or partly because of
    information obtained from a person other than a consumer
    reporting agency bearing upon the consumer's credit worthiness,
    credit standing, credit capacity, character, general
    reputation, personal characteristics, or mode of living, the
    user of such information shall, within a reasonable period of
    time, upon the consumer's written request for the reasons for
    such adverse action received within sixty days after learning
    of such adverse action, disclose the nature of the information
    to the consumer. The user of such information shall clearly and
    accurately disclose to the consumer his right to make such
    written request at the time such adverse action is communicated
    to the consumer.]
      [(c)] (b) No person shall be held liable for any violation of
    this section if he shows by a preponderance of the evidence
    that at the time of the alleged violation he maintained
    reasonable procedures to assure compliance with the provisions
    of [subsections (a) and (b)] subsection (a).
                                  ----------

                                FAIR HOUSING ACT

                            TITLE VIII--FAIR HOUSING

                                  short title

        Sec. 800. This title may be cited as the ``Fair Housing
    Act''.
              * * * * * * *

                      enforcement by the attorney general

        Sec. 814. (a) Pattern or Practice Cases.--Whenever the
    Attorney General has reasonable cause to believe that any
    person or group of persons is engaged in a pattern or practice
    of resistance to the full enjoyment of any of the rights
    granted by this title, or that any group of persons has been
    denied any of the rights granted by this title and such denial
    raises an issue of general public importance, the Attorney
    General may commence a civil action in any appropriate United
    States district court. Before bringing a civil action under the
    preceding sentence against any person or group of persons
    described in paragraph (1), (2), or (3) of section 704(a) of
    the Equal Credit Opportunity Act with respect to a violation of
    805(a) of this title, the Attorney General shall consult with
    the appropriate agency under such paragraph.
              * * * * * * *
    SEC. 814A. SELF-TESTING ENHANCEMENT.

      (a) In General.--If any person--
              (1) conducts, or authorizes an independent third
            party to conduct, a self-test of that person's
            residential real estate related lending activities, or
            any part of such activities, in order to determine the
            level or effectiveness of compliance with this title by
            the person; and
              (2) has identified discriminatory practices and has
            taken or is taking appropriate corrective actions to
            address the discrimination,
    any report or results of such a self-test may not be obtained
    or used by any aggrieved person, complainant, department, or
    agency in any proceeding or civil action brought under this
    title.
      (b) Results of Self-Testing.--No provision of this section
    shall be construed as preventing an aggrieved person,
    complainant, department, or agency from obtaining and using the
    results of any self-testing as described in subsection (a) in
    any proceeding or civil action brought under this title if--
              (1) the creditor or any other entity conducted such
            activity at the request of a department or agency;
              (2) the creditor or any other entity, or any person
            acting on behalf of the creditor or other entity--
                      (A) voluntarily releases or discloses all, or
                    any part of, such results; or
                      (B) refers to or describes such results as a
                    defense to charges of unlawful discrimination
                    against such creditor, person, or entity; or
              (3) the results are sought by the aggrieved person,
            complainant, department, or agency by means of a
            discovery request for the purposes of determining an
            appropriate penalty or remedy for a violation of this
            title.
      (c) Regulations.--The appropriate Federal department or
    agency shall prescribe regulations, after notice and
    opportunity for comment, which determine what types of ``self-
    tests'' are sufficiently extensive so as to constitute a
    determination of the level or effectiveness of a creditor's
    compliance with this title.
              * * * * * * *
                                  ----------

                          EQUAL CREDIT OPPORTUNITY ACT

                      TITLE VII--EQUAL CREDIT OPPORTUNITY

              * * * * * * *

    Sec. 701. Prohibited discrimination; reasons for adverse action

      (a) * * *
              * * * * * * *
      (f) Credit Scoring System.--
              (1) In general.--A creditor shall be deemed to be in
            compliance with subsection (a) with respect to any
            credit decision made by the creditor which is based
            solely on the use of an empirically derived,
            demonstrably and statistically sound, credit scoring
            system (as defined by the Board in regulations
            prescribed under this title) if such system--
                      (A) does not utilize any category protected
                    under subsection (a);
                      (B) does not use as a factor in such system
                    any criterion which is so directly associated
                    with such a category as to be the functional
                    equivalent of such a category; and
                      (C) does not use as a factor in such system
                    any criterion that has a disparate impact on a
                    category protected under subsection (a) unless
                    use of the criterion is justified by business
                    necessity and there is no less discriminatory
                    alternative available.
              (2) Age as a factor.--No provision of this subsection
            shall be construed as precluding a creditor from using
            age as a factor in a credit scoring system under
            paragraph (1) to the extent otherwise permitted under
            this title.
              * * * * * * *

    Sec. 706. Civil liability

      (a) * * *
              * * * * * * *
      (h) When a matter is referred to the Attorney General
    pursuant to subsection (g), or whenever he has reason to
    believe that one or more creditors are engaged in a pattern or
    practice in violation of this title, the Attorney General may
    bring a civil action in any appropriate United States district
    court for such relief as may be appropriate, including actual
    and punitive damages and injunctive relief. Before bringing a
    civil action against any creditor described in paragraph (1),
    (2), or (3) of section 704(a), the Attorney General shall
    consult with the appropriate agency under such paragraph.
              * * * * * * *
                                  ----------

                         CONSUMER CREDIT PROTECTION ACT

              * * * * * * *

                         TITLE I--CONSUMER CREDIT COST
                                   DISCLOSURE

              * * * * * * *

                           CHAPTER 5--CONSUMER LEASES
    Sec.
    181. Definitions.
         * * * * * * *
    187. Regulations.
              * * * * * * *

    [Sec. 184. Consumer lease advertising

      [(a) No advertisement to aid, promote, or assist directly or
    indirectly any consumer lease shall state the amount of any
    payment, the number of required payments, or that any or no
    downpayment or other payment is required at inception of the
    lease unless the advertisement also states clearly and
    conspicuously and in accordance with regulations issued by the
    Board each of the following items of information which is
    applicable:
              [(1) That the transaction advertised is a lease.
              [(2) The amount of any payment required at the
            inception of the lease or that no such payment is
            required if that is the case.
              [(3) The number, amounts, due dates or periods of
            scheduled payments, and the total of payments under the
            lease.
              [(4) That the lessee shall be liable for the
            differential, if any, between the anticipated fair
            market value of the leased property and its appraised
            actual value at the termination of the lease, if the
            lessee has such liability.
              [(5) A statement of the amount or method of
            determining the amount of any liabilities the lease
            imposes upon the lessee at the end of the term and
            whether or not the lessee has the option to purchase
            the leased property and at what price and time.
      [(b)  Radio Advertisements.--
              [(1) In general.--An advertisement by radio broadcast
            to aid, promote, or assist, directly or indirectly, any
            consumer lease shall be deemed to be in compliance with
            the requirements of subsection (a) if such
            advertisement clearly and conspicuously--
                      [(A) states the information required by
                    paragraphs (1) and (2) of subsection (a);
                      [(B) states the number, amounts, due dates or
                    periods of scheduled payments, and the total of
                    such payments under the lease;
                      [(C) includes--
                              [(i) a referral to--
                                      [(I) a toll-free telephone
                                    number established in
                                    accordance with paragraph (2)
                                    that may be used by consumers
                                    to obtain the information
                                    required under subsection (a);
                                    or
                                      [(II) a written advertisement
                                    that--
                                              [(aa) appears in a
                                            publication in general
                                            circulation in the
                                            community served by the
                                            radio station on which
                                            such advertisement is
                                            broadcast during the
                                            period beginning 3 days
                                            before any such
                                            broadcast and ending 10
                                            days after such
                                            broadcast; and
                                              [(bb) includes the
                                            information required to
                                            be disclosed under
                                            subsection (a); and
                              [(ii) the name and dates of any
                            publication referred to in clause
                            (i)(II); and
                      [(D) includes any other information which the
                    Board determines necessary to carry out this
                    chapter.
              [(2) Establishment of toll-free number.--
                      [(A) In general.--In the case of a radio
                    broadcast advertisement described in paragraph
                    (1) that includes a referral to a toll-free
                    telephone number, the lessor who offers the
                    consumer lease shall--
                              [(i) establish such a toll-free
                            telephone number not later than the
                            date on which the advertisement
                            including the referral is broadcast;
                              [(ii) maintain such telephone number
                            for a period of not less than 10 days,
                            beginning on the date of any such
                            broadcast; and
                              [(iii) provide the information
                            required under subsection (a) with
                            respect to the lease to any person who
                            calls such number.
                      [(B) Form of information.--The information
                    required to be provided under subparagraph
                    (A)(iii) shall be provided verbally or, if
                    requested by the consumer, in written form.
              [(3) No effect on other law.--Nothing in this
            subsection shall affect the requirements of Federal law
            as such requirements apply to advertisement by any
            medium other than radio broadcast.
      [(c) There is no liability under this section on the part of
    any owner or personnel, as such, of any medium in which an
    advertisement appears or through which it is disseminated.]
    SEC. 184. CONSUMER LEASE ADVERTISING.

      (a) In General.--If an advertisement for a consumer lease
    states the amount of any payment or states that any or no
    initial payment is required, the advertisement must also
    clearly and conspicuously state the following terms, as
    applicable:
              (1) That the transaction advertised is a lease.
              (2) The total of initial payments required at or
            before consummation of the lease or delivery of the
            property, whichever is later.
              (3) That a security deposit is required.
              (4) The number, amounts, and timing of scheduled
            payments.
              (5) For a lease in which the consumer's liability at
            the end of the lease term is based on the anticipated
            residual value of the property, that an extra charge
            may be imposed at the end of the lease term.
      (b) Advertising Medium Not Liable.--Any owner or personnel of
    any medium in which an advertisement appears or through which
    it is disseminated shall not be liable under this section.
    Sec. 185. Civil liability

      (a) Any lessor who fails to comply with any requirement
    imposed under section 182 or 183 of this chapter with respect
    to any person is liable to such person as provided in section
    130. Notwithstanding the preceding sentence, a creditor shall
    only have liability determined under section 130(a)(2) for
    failing to comply with the requirements of paragraph (2), (8),
    (9), or (10) of section 182 or for failing to comply with
    disclosure requirements under State law for any term which the
    Board has determined to be substantially the same in meaning
    under section 186 as any of the terms referred to in section
    182.
              * * * * * * *
    SEC. 187. REGULATIONS.

      (a) Regulations Authorized.--
              (1) In general.--The Board shall write regulations or
            staff commentary, if appropriate, to update and clarify
            the requirements and definitions for lease disclosures,
            contracts, and any other specific issues related to
            consumer leasing which would carry out the purposes of
            this chapter, to prevent any circumvention of the
            chapter, and to facilitate compliance with the
            requirements of the chapter.
              (2) Classifications, adjustments.--The regulations
            prescribed under paragraph (1) may contain
            classifications and differentiations and may provide
            for adjustments and exceptions for any class of
            transaction.
      (b) Model Disclosures.--The Board shall publish model
    disclosure forms and clauses to facilitate compliance with the
    disclosure requirements and to aid the consumer in
    understanding the transaction. In designing forms, the Board
    shall consider the use by lessors of data processing or similar
    automated equipment. Use of the models shall be optional. A
    lessor who properly uses the material aspects of the models
    shall be deemed to be in compliance with the disclosure
    requirements.
      (c) Effective Dates.--
              (1) In general.--Any regulation of the Board, or any
            amendment or interpretation thereof, that requires a
            disclosure different from the disclosures previously
            required shall have an effective date of the October 1
            that follows the date of promulgation by at least 6
            months.
              (2) Longer period.--The Board may, in the Board's
            discretion, lengthen the period of time referred to in
            paragraph (1) to permit lessors to adjust their forms
            to accommodate new requirements.
              (3) Shorter period.--The Board may also shorten the
            period of time referred to in paragraph (1) if the
            Board makes a specific finding that such action is
            necessary to comply with the findings of a court or to
            prevent unfair or deceptive practices.
              (4) Compliance before effective date.--Lessors may
            comply with any newly promulgated disclosure
            requirement before the effective date of such
            requirement.
                                  ----------

                        BANK HOLDING COMPANY ACT OF 1956

                                  definitions

      Sec. 2. (a) * * *
              * * * * * * *
      (g) For the purposes of this Act--
              (1) shares owned or controlled by any subsidiary of a
            bank holding company shall be deemed to be indirectly
            owned or controlled by such bank holding company; and
              (2) shares held or controlled directly or indirectly
            by trustees for the benefit of (A) a company, (B) the
            shareholders or members of a company, or (C) the
            employees (whether exclusively or not) of a company,
            shall be deemed to be controlled by such company[;
            and].
              [(3) shares transferred after January 1, 1966, by any
            bank holding company (or by any company which, but for
            such transfer, would be a bank holding company)
            directly or indirectly to any transferee that is
            indebted to the transferor, or has one or more
            officers, directors, trustees, or beneficiaries in
            common with or subject to control by the transferor,
            shall be deemed to be indirectly owned or controlled by
            the transferor unless the Board, after opportunity for
            hearing, determines that the transferor is not in fact
            capable of controlling the transferee.]
              * * * * * * *
      (o) Other Definitions.--For purposes of this Act, the
    following definitions shall apply:
              [(1) Adequately capitalized.--The term ``adequately
            capitalized'' means a level of capitalization which
            meets or exceeds all applicable Federal regulatory
            capital standards.]
              (1) Capital terms.--
                      (A) Insured depository institutions.--With
                    respect to insured depository institutions, the
                    terms ``well-capitalized'', ``adequately
                    capitalized'', and ``uncapitalized'' have the
                    meaning given those terms in section 38(b) of
                    the Federal Deposit Insurance Act.
                      (B) Bank holding company.--
                              (i) Adequately capitalized.--The term
                            ``adequately capitalized'' means a
                            level of capitalization which meets or
                            exceeds all applicable Federal
                            regulatory capital standards.
                              (ii) Well capitalized.--A bank
                            holding company is ``well capitalized''
                            if it meets the required capital levels
                            for well capitalized bank holding
                            companies established by the Board.
                      (C) Other capital terms.--The terms ``Tier
                    1'' and ``risk-weighted assets'' have the
                    meaning given those terms in the capital
                    guidelines or regulations established by the
                    Board for bank holding companies.
              * * * * * * *
              (8) Lead insured depository institutions.--
                      (A) In general.--The term ``lead insured
                    depository institution'' means the largest
                    insured depository institution controlled by
                    the bank holding company at any time, based on
                    a comparison of the average total risk-weighted
                    assets controlled by each insured depository
                    institution during the previous 12-month
                    period.
                      (B) Branch or agency.--For purposes of this
                    paragraph and section 4(j)(4), the term
                    `insured depository institution' shall also
                    include any branch or agency operated in the
                    United States by a foreign bank.
              (9) Well managed.--The term ``well managed'' means--
                      (A) in the case of any company or depository
                    institution which receives examinations, the
                    achievement of--
                              (i) a CAMEL composite rating of 1 or
                            2 (or an equivalent rating under an
                            equivalent rating system) in connection
                            with the most recent examination or
                            subsequent review of such company or
                            institution; and
                              (ii) at least a satisfactory rating
                            for management, if such rating is
                            given; or
                      (B) in the case of a company or depository
                    institution that has not received an
                    examination rating, the existence and use of
                    managerial resources which the Board determines
                    are satisfactory.
              * * * * * * *

                      acquisition of bank shares or assets

      Sec. 3. (a) * * *
              * * * * * * *
      (h) No Approval Required for Certain Transactions.--
              (1) In general.--Notwithstanding paragraph (3) or (5)
            of subsection (a) and subject to paragraphs (5) and
            (6), an acquisition of shares by a registered bank
            holding company, or a merger or consolidation between
            registered bank holding companies, shall be deemed
            approved at the conclusion of the period specified in
            subparagraph (G) if all of the following conditions
            have been met:
                      (A) Financial and managerial criteria.--
                              (i) Well capitalized bank holding
                            company.--Both at the time of and
                            immediately after the proposed
                            transaction, the acquiring bank holding
                            company is well capitalized.
                              (ii) Well capitalized lead insured
                            depository institution.--Both at the
                            time of and immediately after the
                            proposed transaction, the lead insured
                            depository institution of the acquiring
                            bank holding company is well
                            capitalized.
                              (iii) Capital of other insured
                            depository institutions.--At the time
                            of the transaction, well capitalized
                            insured depository institutions control
                            at least 80 percent of the aggregate
                            total risk-weighted assets of insured
                            depository institutions controlled by
                            the acquiring bank holding company.
                              (iv) No undercapitalized insured
                            depository institutions.--At the time
                            of the transaction, no insured
                            depository institution controlled by
                            the acquiring bank holding company is
                            undercapitalized.
                              (v) Well managed.--
                                      (I) In general.--At the time
                                    of the transaction, the
                                    acquiring bank holding company,
                                    its lead insured depository
                                    institution, and insured
                                    depository institutions that
                                    control at least 90 percent of
                                    the aggregate total risk-
                                    weighted assets of insured
                                    depository institutions
                                    controlled by such holding
                                    company are well managed.
                                      (II) No poorly managed
                                    institutions.--Except with
                                    respect to insured depository
                                    institutions described in
                                    paragraph (2), no insured
                                    depository institution
                                    controlled by the acquiring
                                    bank holding company has
                                    received 1 of the 2 lowest
                                    composite ratings at the later
                                    of the institution's most
                                    recent examination or
                                    subsequent review.
                      (B) No unsatisfactory cra ratings.--Except
                    with respect to insured depository institutions
                    described in paragraph (3), no insured
                    depository institution controlled by the
                    acquiring bank holding company has received a
                    ``needs to improve'' or ``substantial
                    noncompliance'' composite rating as a result of
                    the institution's most recent examination under
                    the Community Reinvestment Act of 1977.
                      (C) Competitive criteria.--Consummation of
                    the proposal complies with guidelines
                    established by the Board by regulation, after
                    consultation with the Attorney General, that
                    identify proposals that are not likely to have
                    a significantly adverse effect on competition
                    in any relevant market.
                      (D) Size of acquisition.--
                              (i) Asset size.--The book value of
                            the total assets to be acquired does
                            not exceed 10 percent of the
                            consolidated total risk weighted assets
                            of the acquiring bank holding company.
                              (ii) Consideration.--The gross
                            consideration to be paid for the
                            securities or assets does not exceed 15
                            percent of the consolidated Tier 1
                            capital of the acquiring bank holding
                            company.
                      (E) Interstate acquisitions.--Board approval
                    of the transaction is not prohibited under
                    subsection (d).
                      (F) Compliance criterion.--During the 12-
                    month period ending on the date of the
                    transaction, no administrative enforcement
                    action has been commenced, and no cease and
                    desist order has been issued pursuant to
                    section 8 of the Federal Deposit Insurance Act,
                    against any bank holding company involved in
                    the transaction or any depository institution
                    subsidiary of any such holding company and no
                    such enforcement action, order, or other
                    administrative enforcement proceeding is
                    pending as of such date.
                      (G) Other considerations.--Board approval of
                    the transaction is not prohibited under
                    subsection (c)(3).
                      (H) Notification.--The acquiring bank holding
                    company provides written notice of the
                    transaction, including a description of the
                    terms of the transaction, to the Board and the
                    Attorney General, simultaneously, at least 15
                    business days (or such shorter period as
                    permitted by the Board) before the transaction
                    is consummated.
                      (I) No board disapproval.--Before the end of
                    the 15-day period (or the shorter period)
                    referred to in subparagraph (H), the Board has
                    not required an application under subsection
                    (a).
              (2) Special rule relating to the requirement for well
            managed institutions.--Insured depository institutions
            which have been acquired by a bank holding company
            during the 12-month period preceding the date of the
            transaction may be excluded for purposes of paragraph
            (1)(A)(v)(II) if--
                      (A) the bank holding company has developed a
                    plan for the institution to restore the capital
                    and management of the institution which is
                    acceptable to the appropriate Federal banking
                    agency; and
                      (B) all such insured depository institutions
                    represent, in the aggregate, less than 10
                    percent of the aggregate total risk-weighted
                    assets of all insured depository institutions
                    controlled by the holding company.
              (3) Special rule relating to the requirement for
            community investment.--Insured depository institutions
            acquired during the 12-month period preceding the date
            of the transaction may be excluded for purposes of
            paragraph (1)(B) if the bank holding company has
            developed a plan to restore the performance of the
            institution to at least a ``satisfactory'' rating under
            the Community Reinvestment Act of 1977 which is
            acceptable to the appropriate Federal banking agency.
              (4) Adjustment of percentages.--The Board may by
            regulation adjust the percentages and the manner in
            which the percentages of insured depository
            institutions are calculated under subparagraph
            (A)(v)(I) or (D) of paragraph (1) or paragraph (2)(B)
            if the Board determines that such adjustment is
            consistent with safety and soundness and the purposes
            of this Act.
              (5) Advice of attorney general.--The Attorney General
            shall advise the Board during the period referred to in
            paragraph (1)(H) in writing if any competitive concerns
            exist with respect to the transaction.
              (6) Waiver of postapproval waiting period.--If the
            Attorney General advises the Board that no competitive
            concerns exist with respect to the transaction, the
            provisions of section 11(b) relating to a postapproval
            waiting shall not apply with respect to such
            transaction.
                     interests in nonbanking organizations

      Sec. 4. (a) * * *
              * * * * * * *
      (c) The prohibitions in this section shall not apply to (i)
    any company that was on January 4, 1977, both a bank holding
    company and a labor, agricultural, or horticultural
    organization exempt from taxation under section 501 of the
    Internal Revenue Code of 1954, or to any labor, agricultural,
    or horticultural organization to which all or substantially all
    of the assets of such company are hereafter transferred, or
    (ii) a company covered in 1970 more than 85 per centum of the
    voting stock of which was collectively owned on June 30, 1968,
    and continuously thereafter, directly or indirectly, by or for
    members of the same family, or their spouses, who are lineal
    descendants of common ancestors; and such prohibitions shall
    not, with respect to any other bank holding company, apply to--
              (1) shares of any company engaged or to be engaged
            solely in one or more of the following activities: (A)
            holding or operating properties used wholly or
            substantially by any banking subsidiary of such bank
            holding company in the operations of such banking
            subsidiary or acquired for such future use; or (B)
            conducting a safe deposit business; or (C) furnishing
            services to or performing services for such bank
            holding company or its banking subsidiaries; or (D)
            liquidating assets acquired from such bank holding
            company or its banking subsidiaries or acquired from
            any other source prior to May 9, 1956, or the date on
            which such company became a bank holding company,
            whichever is later;
              (2) shares acquired by a bank holding company or any
            of its subsidiaries in satisfaction of a debt
            previously contracted in good faith, but such shares
            shall be disposed of within a period of two years from
            the date on which they were acquired, except that the
            Board is authorized upon application by such bank
            holding company to extend such period of two years from
            time to time as to such holding company [for not more
            than one year at a time] if, in its judgment, such an
            extension would not be detrimental to the public
            interest, [but no such extensions shall extend beyond a
            date five years] and, in the case of a bank holding
            company which has not disposed of such shares within 5
            years of the date such shares were acquired, the Board
            may, upon the application of such company, grant
            additional exemptions if, in the Board's judgment, such
            extension would not be detrimental to the public
            interest and either the bank holding company has made a
            good faith attempt to dispose of such shares during
            such 5-year period or the disposal of such shares
            during such 5-year period would have been detrimental
            to the company, but the aggregate duration of such
            extensions shall not extend 10 years after the date on
            which such shares were acquired;
              * * * * * * *
              (8) shares of any company the activities of which the
            Board after due notice [and opportunity for hearing]
            has determined (by order or regulation) to be so
            closely related to banking or managing or controlling
            banks as to be a proper incident thereto, but for
            purposes of this subsection it is not closely related
            to banking or managing or controlling banks for a bank
            holding company to provide insurance as a principal,
            agent, or broker except (A) where the insurance is
            limited to assuring repayment of the outstanding
            balance due on a specific extension of credit by a bank
            holding company or its subsidiary in the event of the
            death, disability, or involuntary unemployment of the
            debtor; (B) in the case of a finance company which is a
            subsidiary of a bank holding company, where the
            insurance is also limited to assuring repayment of the
            outstanding balance on an extension of credit in the
            event of loss or damage to any property used as
            collateral on such extention of credit and, during the
            period beginning on the date of the enactment of this
            subparagraph and ending on December 31, 1982, such
            extension of credit is not more than $10,000 ($25,000
            in the case of an extension of credit which is made to
            finance the purchase of a residential manufactured home
            and which is secured by such residential manufactured
            home) and for any given year after 1982, such extension
            of credit is not more than an amount equal to $10,000
            ($25,000 in the case of an extension of credit which is
            made to finance the purchase of a residential
            manufactured home and which is secured by such
            residential manufactured home) increased by the
            percentage increase in the Consumer Price Index for
            Urban Wage Earners and Clerical Workers published
            monthly by the Bureau of Labor Statistics for the
            period beginning on January 1, 1982, and ending on
            December 31 of the year preceding the year in which
            such extension of credit is made; (C) any insurance
            agency activity in a place that (i) has a population
            not exceeding five thousand (as shown by the last
            preceding decennial census), or (ii) the bank holding
            company, after notice and opportunity for a hearing,
            demonstrates has inadequate insurance agency
            facilities; (D) any insurance agency activity which was
            engaged in by the bank holding company or any of its
            subsidiaries on May 1, 1982, or which the Board
            approved for such company or any of its subsidiaries on
            or before May 1, 1982, including (i) sales of insurance
            at new locations of the same bank holding company or
            the same subsidiary or subsidiaries with respect to
            which insurance was sold on May 1, 1982, or approved to
            be sold on or before May 1, 1982, if such new locations
            are confined to the State in which the principal place
            of business of the bank holding company is located, any
            State or States immediately adjacent to such State, and
            any State or States in which insurance activities were
            conducted by the bank holding company or any of its
            subsidiaries on May 1, 1982, or were approved to be
            conducted by the bank holding company or any of its
            subsidiaries on or before May 1, 1982, and (ii) sales
            of insurance coverages which may become available after
            May 1, 1982, so long as those coverages insure against
            the same types of risks as, or are otherwise
            functionally equivalent to, coverages sold on May 1,
            1982, or approved to be sold on or before May 1, 1982
            (for purposes of this subparagraph, activities engaged
            in or approved by the Board on May 1, 1982, shall
            include activities carried on subsequent to that date
            as the result of an application to engage in such
            activities pending on May 1, 1982, and approved
            subsequent to that date or of the acquisition by such
            company pursuant to a binding written contract entered
            into on or before May 1, 1982, of another company
            engaged in such activities at the time of the
            acquisition); (E) any insurance activity where the
            activity is limited solely to supervising on behalf of
            insurance underwriters the activities of retail
            insurance agents who sell (i) fidelity insurance and
            property and casualty insurance on the real and
            personal property used in the operations of the bank
            holding company or any of its subsidiaries, and (ii)
            group insurance that protects the employees of the bank
            holding company or any of its subsidiaries; (F) any
            insurance agency activity engaged in by a bank holding
            company, or any of its subsidiaries, which bank holding
            company has total assets of $50,000,000 or less:
            Provided, however, That such a bank holding company and
            its subsidiaries may not engage in the sale of life
            insurance or annuities except as provided in
            subparagraph (A), (B), or (C); or (G) where the
            activity is performed, or shares of the company
            involved are owned, directly or indirectly, by a bank
            holding company which is registered with the Board of
            Governors of the Federal Reserve System and which,
            prior to January 1, 1971, was engaged, directly or
            indirectly, in insurance agency activities as a
            [consequence of approval by the Board prior to January
            1, 1971.] consequence of approval by the Board prior to
            January 1, 1971, except that, after March 30, 1997, it
            shall be closely related to banking or managing or
            controlling banks and a proper incident thereto to
            provide insurance as a principal, agent, or broker in
            any State, in full compliance with the laws and
            regulations of such State that apply uniformly to each
            type of insurance license or authorization in that
            State, including laws that restrict a bank in that
            State from having an affiliate, agent, or employee in
            that State licensed to provide insurance as principal,
            agent, or broker. The Board shall prescribe regulations
            concerning insurance affiliations that provide
            equivalent treatment for all stock and mutual fund
            insurance companies that control or are affiliated with
            a bank, and fully accommodate and are consistent with
            State law. In determining whether a particular activity
            is a proper incident to banking or managing or
            controlling banks the Board shall consider whether its
            performance by an affiliate of a holding company can
            reasonably be expected to produce benefits to the
            public, such as greater convenience, increased
            competition, or gains in efficiency, that outweigh
            possible adverse effects, such as undue concentration
            of resources, decreased or unfair competition,
            conflicts of interests, or unsound banking practices.
            In orders and regulation under this subsection, the
            Board may differentiate between activities commenced de
            novo and activities commenced by the acquisition, in
            whole or in part, of a going concern. Notwithstanding
            any other provision of this Act, if the Board finds
            that an emergency exists which requires the Board to
            act immediately on any application under this
            subsection involving a thrift institution, and the
            primary Federal regulator of such institution concurs
            in such finding, the Board may dispense with the notice
            and hearing requirement of this subsection and the
            Board may approve or deny any such application without
            notice or hearing. If an application is filed under
            this paragraph in connection with an application to
            make an acquisition pursuant to section 13(f) of the
            Federal Deposit Insurance Act, the Board may dispense
            with the notice and hearing requirement of this
            paragraph and the Board may approve or deny the
            application under this paragraph without notice or
            hearing. If an application described in the preceding
            sentence is approved, the Board shall publish in the
            Federal Register, not later than 7 days after such
            approval is granted, the order approving the
            application and a description of the nonbanking
            activities involved in the acquisition;
              * * * * * * *
      (i) Acquisition of Savings Associations.--
              (1) * * *
              * * * * * * *
              (4) Solicitation of views.--
                      (A) Notice to director.--Upon receiving any
                    application or notice by a bank holding company
                    to acquire directly or indirectly a savings
                    association under subsection (c)(8), the Board
                    shall solicit the Director's comments and
                    recommendations with respect to such
                    acquisition.
                      (B) Comment period.--The comments and views
                    of the Director under subparagraph (A) with
                    respect to any acquisition subject to such
                    subparagraph shall be transmitted to the Board
                    within 30 days of the receipt by the Director
                    of the notice relating to such acquisition (or
                    such shorter period as the Board may specify if
                    the Board advises the Director that an
                    emergency exists which requires expeditious
                    action).
              (5) Examination.--
                      (A) Scope.--The Board shall consult with the
                    Director, as appropriate, in establishing the
                    scope of an examination by the Board of a bank
                    holding company that controls directly or
                    indirectly a savings association.
                      (B) Access to inspection reports.--Upon the
                    request of the Director, the Board shall
                    furnish the Director with a copy of any
                    inspection report, additional examination
                    materials, or supervisory information relating
                    to any bank holding company which directly or
                    indirectly controls a savings association.
              (6)  Coordination of enforcement efforts.--The Board
            and the Director shall cooperate in any enforcement
            action against any bank holding company which controls
            a savings association, if the relevant conduct involves
            such association.
              (7) Director defined.--For purposes of this section,
            the term ``Director'' means the Director of the Office
            of Thrift Supervision.
      (j) Notice Procedures for Nonbanking Activities.--
              (1) General notice procedure.--
                      (A) Notice requirement.--[No] Except as
                    provided in paragraph (3), no bank holding
                    company may engage in any nonbanking activity
                    or acquire or retain ownership or control of
                    the shares of a company engaged in activities
                    based on subsection (c)(8) or (a)(2) without
                    providing the Board with written notice of the
                    proposed transaction or activity at least 60
                    days before the transaction or activity is
                    proposed to occur or commence.
              * * * * * * *
              (3) No notice required for certain transactions.--No
            notice under paragraph (1) or subsections (c)(8) or
            (a)(2)(B) is required for a proposal by a bank holding
            company to engage in any activity or acquire the shares
            or assets of any company if the proposal qualifies
            under paragraph (4).
              (4) Criteria for statutory approval.--A proposal
            qualifies under this paragraph if all of the following
            criteria are met:
                      (A) Financial criteria.--Both before and
                    immediately after the proposed transaction--
                              (i) the acquiring bank holding
                            company is well capitalized;
                              (ii) the lead insured depository
                            institution of such holding company is
                            well capitalized;
                              (iii) well capitalized insured
                            depository institutions control at
                            least 80 percent of the aggregate total
                            risk-weighted assets of insured
                            depository institutions controlled by
                            such holding company; and
                              (iv) no insured depository
                            institution controlled by such holding
                            company is undercapitalized.
                      (B) Managerial criteria.--
                              (i) Well managed.--At the time of the
                            transaction, the acquiring bank holding
                            company, its lead insured depository
                            institution, and insured depository
                            institutions that control at least 90
                            percent of the aggregate total risk-
                            weighted assets of insured depository
                            institutions controlled by such holding
                            company are well managed.
                              (ii) Limitation on poorly managed
                            institutions.--Except with respect to
                            insured depository institutions
                            described in paragraph (6), no insured
                            depository institution controlled by
                            the acquiring bank holding company has
                            received 1 of the 2 lowest composite
                            ratings at the later of the
                            institution's most recent examination
                            or subsequent review.
                      (C) Activities permissible.--Following
                    consummation of the proposal, the bank holding
                    company engages directly or through a
                    subsidiary solely in--
                              (i) activities that are permissible
                            under subsection (c)(8), as determined
                            by the Board by regulation or order
                            thereunder, subject to all of the
                            restrictions, terms and conditions of
                            such subsection and such regulation or
                            order; and
                              (ii) such other activities as are
                            otherwise permissible under this
                            section, subject to the restrictions,
                            terms and conditions, including any
                            prior notice or approval requirements,
                            provided in this section.
                      (D) Size of acquisition.--
                              (i) Asset size.--The book value of
                            the total assets to be acquired does
                            not exceed 10 percent of the
                            consolidated total risk-weighted assets
                            of the acquiring bank holding company;
                            and
                              (ii) Consideration.--The gross
                            consideration to be paid for the
                            securities or assets does not exceed 15
                            percent of the consolidated Tier 1
                            capital of the acquiring bank holding
                            company.
                      (E) Notice not otherwise warranted.--For
                    proposals described in paragraph (5)(B), the
                    Board has not, before the conclusion of the
                    period provided in paragraph (5)(B), advised
                    the bank holding company that a notice under
                    paragraph (1) is required.
                      (F) Compliance criterion.--During the 12-
                    month period ending on the date on which the
                    bank holding company proposes to commence an
                    activity or acquisition, no administrative
                    enforcement action has been commenced, and no
                    cease and desist order has been issued pursuant
                    to section 8 of the Federal Deposit Insurance
                    Act, against the bank holding company or any
                    depository institution subsidiary of the
                    holding company and no such enforcement action,
                    order, or other administrative enforcement
                    proceeding is pending as of such date.
              (5) Notification.--
                      (A) Commencement of activities approved by
                    rule.--A bank holding company that qualifies
                    under paragraph (4) and that proposes to engage
                    de novo, directly or through a subsidiary, in
                    any activity that is permissible under
                    subsection (c)(8), as determined by the Board
                    by regulation, may commence that activity
                    without prior notice to the Board and must
                    provide written notification to the Board no
                    later than ten business days after commencing
                    the activity.
                      (B) Activities permitted by order and
                    acquisitions.--
                              (i) In general.--At least 12 business
                            days before commencing any activity
                            pursuant to paragraph (3) (other than
                            an activity described in subparagraph
                            (A)) or acquiring shares or assets of
                            any company pursuant to paragraph (3),
                            the bank holding company shall provide
                            the written notification of the
                            proposal to the Board, unless the Board
                            determines that no notice or a shorter
                            notice period is appropriate.
                              (ii) Description of activities and
                            terms.--A notification under this
                            subparagraph shall include a
                            description of the proposed activities
                            and the terms of any proposed
                            acquisition.
              (6) Recently acquired institutions.--Insured
            depository institutions which have been acquired by a
            bank holding company during the 12-month period
            preceding the date on which the company proposes to
            commence an activity or acquisition pursuant to
            paragraph (3) may be excluded for purposes of paragraph
            (4)(B)(ii) if--
                      (A) the bank holding company has developed a
                    plan for the institution to restore the capital
                    and management of the institution which is
                    acceptable to the appropriate Federal banking
                    agency; and
                      (B) all such insured depository institutions
                    represent, in the aggregate, less than 10
                    percent of the aggregate total risk-weighted
                    assets of all insured depository institutions
                    controlled by the bank holding company.
              (7) Adjustment of percentages.--The Board may, by
            regulation, adjust the percentages and the manner in
            which the percentages of insured depository
            institutions are calculated under paragraph (4)(B)(i),
            (4)(D), or paragraph (6)(B) if the Board determines
            that any such adjustment is consistent with safety and
            soundness and the purposes of this Act.
              * * * * * * *
                                  ----------

                   NATIONAL BANK CONSOLIDATION AND MERGER ACT

              * * * * * * *

    SEC. 2. CONSOLIDATION OF BANKS WITHIN THE SAME STATE.

      (a) In General.--Any national bank or any bank incorporated
    under the laws of any State may, with the approval of the
    Comptroller, be consolidated with one or more national banking
    associations located in the same State under the charter of a
    national banking association on such terms and conditions as
    may be lawfully agreed upon by a majority of the board of
    directors of each association or bank proposing to consolidate,
    and be ratified and confirmed by the affirmative vote of the
    shareholders of each such association or bank owning at least
    two-thirds of its capital stock outstanding, or by a greater
    proportion of such capital stock in the case of such State bank
    if the laws of the State where it is organized so require, at a
    meeting to be held on the call of the directors after
    publishing notice of the time, place, and object of the meeting
    for four consecutive weeks in a newspaper of general
    circulation published in the place where the association or
    bank is located, or, if there is no such newspaper, then in the
    paper of general circulation published nearest thereto, and
    after sending such notice to each shareholder of record by
    certified or registered mail at least ten days prior to the
    meeting, except to those shareholders who specifically waive
    notice, but any additional notice shall be given to the
    shareholders of such State bank which may be required by the
    laws of the State where it is organized. Publication of notice
    may be waived, in cases where the Comptroller determines that
    an emergency exists justifying such waiver, by unanimous action
    of the shareholders of the association or State bank. No
    approval by the Comptroller of the Currency is required under
    this subsection for a transaction which involves the
    consolidation of banks that, at the time of the consolidation,
    are all subsidiaries (as defined in section 3 of the Federal
    Deposit Insurance Act) of the same company.
      (b) The consolidated association shall be liable for all
    liabilities of the respective consolidating banks or
    associations. The capital stock of such consolidated
    association shall not be less than that required under existing
    law for the organization of a national bank in the place in
    which it is located: Provided, That if such consolidation shall
    be voted for at such meetings by the necessary majorities of
    the shareholders of each association and State bank proposing
    to consolidate[, and thereafter the consolidation shall be
    approved by the Comptroller], any shareholder of any of the
    associations or State banks so consolidated who has voted
    against such consolidation at the meeting of the association or
    bank of which he is a stockholder, or who has given notice in
    writing at or prior to such meeting to the presiding officer
    that he dissents from the plan of consolidation, shall be
    entitled to receive the value of the shares so held by him
    [when such consolidation is approved by the Comptroller] upon
    written request made to the consolidated association at any
    time before thirty days after the date of consummation of the
    consolidation, accompanied by the surrender of his stock
    certificates.
              * * * * * * *
      Sec. 3. (a) One or more national banking associations or one
    or more State banks, with the approval of the Comptroller,
    under an agreement not inconsistent with this Act, may merge
    into a national banking association located within the same
    State, under the charter of the receiving association. The
    merger agreement shall--
              (1) * * *
              * * * * * * *
    No approval by the Comptroller of the Currency is required
    under this subsection for a transaction which involves the
    merger of banks that, at the time of the merger, are all
    subsidiaries (as defined in section 3 of the Federal Deposit
    Insurance Act) of the same company.
      (b) If a merger shall be voted for at the called meetings by
    the necessary majorities of the shareholders of each
    association or State bank participating in the plan of merger[,
    and thereafter the merger shall be approved by the
    Comptroller], any shareholder of any association or State bank
    to be merged into the receiving association who has voted
    against such merger at the meeting of the association or bank
    of which he is a stockholder, or has given notice in writing at
    or prior to such meeting to the presiding officer that he
    dissents from the plan of merger shall be entitled to receive
    the value of the shares so held by him [when such merger shall
    be approved by the Comptroller] upon written request made to
    the receiving association at any time before thirty days after
    the date of consummation of the merger, accompanied by the
    surrender of his stock certificates.
              * * * * * * *
                                  ----------

                                REVISED STATUTES

              * * * * * * *

                                   TITLE LXII

                                 NATIONAL BANKS

              * * * * * * *

                                  CHAPTER ONE

                            ORGANIZATION AND POWERS
    Sec.
    5133. Formation of national banking associations.
    5134. Requisites of organization certificate.
    5135. How certificate shall be acknowledged and filed.
    5136. Corporate powers of associations.
    5136A. State supervision of insurance.
    5136B. Insurance sales in empowerment zones.
    [5136A.] 5136C. Participation in lotteries prohibited.
    5137. Power to hold real property.
              * * * * * * *
      Sec. 5136. [Upon duly making and filing articles of
    association] (a) In General.--Upon duly making and filing
    articles of association and an organization certificate, the
    association shall become, as from the date of the execution of
    its organization certificate, a body corporate, and as such,
    and in the name designated in the organization certificate, it
    shall have power--
      First. To adopt and use a corporate seal.
      Second. To have succession from the date of the approval of
    this Act, or from the date of its organization if organized
    after such date of approval until such time as it be dissolved
    by the act of its shareholders owning two-thirds of its stock,
    or until its franchise becomes forfeited by reason of violation
    of law, or until terminated by either a general or a special
    Act of Congress or until its affairs be placed in the hands of
    a receiver and finally wound up by him.
              * * * * * * *
      Seventh. To exercise by its board of directors or duly
    authorized officers or agents, [subject to law,] subject to
    subsection (b), section 5136A, and any other provision of law,
    all such incidental powers as shall be necessary to carry on
    the business of banking; by discounting and negotiating
    promissory notes, drafts, bills of exchange, and other
    evidences of debt; by receiving deposits; by buying and selling
    exchange, coin, and bullion; by loaning money on personal
    security; and by obtaining, issuing, and circulating notes
    according to the provisions of this title. The business of
    dealing in securities and stock by the association shall be
    limited to purchasing and selling such securities and stock
    without recourse, solely upon the order, and for the account
    of, customers, and in no case for its own account, and the
    association shall not underwrite any issue of securities or
    stock: Provided, That the association may purchase for its own
    account investment securities under such limitations and
    restrictions as the Comptroller of the Currency may by
    regulation prescribe. In no event shall the total amount of the
    investment securities of any one obligor or maker, held by the
    association for its own account, exceed at any time 10 per
    centum of its capital stock actually paid in and unimpaired and
    10 per centum of its unimpaired surplus fund, except that this
    limitation shall not require any association to dispose of any
    securities lawfully held by it on the date of enactment of the
    Banking Act of 1935. As used in this section the term
    ``investment securities'' shall mean marketable obligations
    evidencing indebtedness of any person, copartnership,
    association, or corporation in the form of bonds, notes and/or
    debentures commonly known as investment securities under such
    further definition of the term ``investment securities'' as may
    by regulation be prescribed by the Comptroller of the Currency.
    Except as hereinafter provided or otherwise permitted by law,
    nothing herein contained shall authorize the purchase by the
    association for its own account of any shares of stock of any
    corporation. The limitations and restrictions herein contained
    as to dealing in, underwriting and purchasing for its own
    account, investment securities shall not apply to obligations
    of the United States, or general obligations of any State or of
    any political subdivision thereof, or obligations of the
    Washington Metropolitan Area Transit Authority which are
    guaranteed by the Secretary of Transportation under section 9
    of the National Capital Transportation Act of 1969, or
    obligations issued under authority of the Federal Farm Loan
    Act, as amended, or issued by the thirteen banks for
    cooperatives or any of them or the Federal Home Loan Banks, or
    obligations which are insured by the Secretary of Housing and
    Urban Development under title XI of the National Housing Act,
    or obligations which are insured by the Secretary of Housing
    and Urban Development (hereafter in this sentence referred to
    as the ``Secretary'' pursuant to section 207 of the National
    Housing Act, if the debentures to be issued in payment of such
    insured obligations are guaranteed as to principal and interest
    by the United States, or obligations, participations, or other
    instruments of or issued by the Federal National Mortgage
    Association or the Government National Mortgage Association, or
    mortgages, obligations, or other securities which are or ever
    have been sold by the Federal Home Loan Mortgage Corporation
    pursuant to section 305 or section 306 of the Federal Home Loan
    Mortgage Corporation Act or obligations of the Federal
    Financing Bank or obligations of the Environmental Financing
    Authority or obligations or other instruments or securities of
    the Student Loan Marketing Association, or such obligations of
    any local public agency (as defined in section 110 (h) of the
    Housing Act of 1949) as are secured by an agreement between the
    local public agency and the Secretary in which the local public
    agency agrees to borrow from said Secretary and said Secretary
    agrees to lend to said local public agency, monies in an
    aggregate amount which (together with any other monies
    irrevocably committed to the payment of interest on such
    obligations) will suffice to pay, when due, the interest on and
    all installments (including the final installment) of the
    principal of such obligations, which monies under the terms of
    said agreement are required to be used for such payments, or
    such obligations of a public housing agency (as defined in the
    United States Housing Act of 1937, as amended) as are secured
    (1) by an agreement between the public housing agency and the
    Secretary in which the public housing agency agrees to borrow
    from the Secretary and the Secretary agrees to lend to the
    public housing agency, prior to the maturity of such
    obligations, monies in an amount which (together with any other
    monies irrevocably committed to the payment of interest on such
    obligations) will suffice to pay the principal of such
    obligations with interest to maturity thereon, which monies
    under the terms of said agreement are required to be used for
    the purpose of paying the principal of and the interest on such
    obligations at their maturity, (2) by a pledge of annual
    contributions under an annual contributions contract between
    such public housing agency and the Secretary if such contract
    shall contain the covenant by the Secretary which is authorized
    by subsection (b) of section 22 of the United States Housing
    Act of 1937, as amended, and if the maximum sum and the maximum
    period specified in such contract pursuant to said subsection
    22(b) shall not be less than the annual amount and the period
    for payment which are requisite to provide for the payment when
    due of all installments of principal and interest on such
    obligations, or (3) by a pledge or both annual contributions
    under an annual contributions contract containing the covenant
    by the Secretary which is authorized by section 6(g) of the
    United States Housing Act of 1937, and a loan under an
    agreement between the local public housing agency and the
    Secretary in which the public housing agency agrees to borrow
    from the Secretary, and the Secretary agrees to lend to the
    public housing agency, prior to the maturity of the obligations
    involved, moneys in an amount which (together with any other
    moneys irrevocably committed under the annual contributions
    contract to the payment of principal and interest on such
    obligations) will suffice to provide for the payment when due
    of all installments of principal and interest on such
    obligations, which moneys under the terms of the agreement are
    required to be used for the purpose of paying the principal and
    interest on such obligations at their maturity: Provided, That
    in carrying on the business commonly known as the safe-deposit
    business the association shall not invest in the capital stock
    of a corporation organized under the law of any State to
    conduct a safe-deposit business in an amount in excess of 15
    per centum of the capital stock of the association actually
    paid in and unimpaired and 15 per centum of its unimpaired
    surplus. The limitations and restrictions herein contained as
    to dealing in and underwriting investment securities shall not
    apply to obligations issued by the International Bank for
    Reconstruction and Development, the European Bank for
    Reconstruction and Development, the Inter-American Development
    Bank, the Asian Development Bank the African Development Bank,
    the Inter-American Investment Corporation, or the International
    Finance Corporation, or obligations issued by any State or
    political subdivision or any agency of a State or political
    subdivision for housing, university, or dormitory purposes,
    which are at the time eligible for purchase by a national bank
    for its own account, nor to bonds, notes and other obligations
    issued by the Tennessee Valley Authority or by the United
    States Postal Service,: Provided, That no association shall
    hold obligations issued by any of said organizations as a
    result of underwriting, dealing, or purchasing for its own
    account (and for this purpose obligations as to which it is
    under commitment shall be deemed to be held by it) in a total
    amount exceeding at any one time 10 per centum of its capital
    stock actually paid in and unimpaired and 10 per centum of its
    unimpaired surplus fund. Notwithstanding any other provision in
    this paragraph, the association may purchase for its own
    account shares of stock issued by a corporation authorized to
    be created pursuant to title IX of the Housing and Urban
    Development Act of 1968, and may make investments in a
    partnership, limited partnership, or joint venture formed
    pursuant to section 907(a) or 907(c) of that Act.
    Notwithstanding any other provision of this paragraph, the
    association may purchase for its own account shares of stock
    issued by any State housing corporation incorporated in the
    State in which the association is located and may make
    investments in loans and commitments for loans to any such
    corporation: Provided, That in no event shall the total amount
    of such stock held for its own account and such investments in
    loans and commitments made by the association exceed at any
    time 5 per centum of its capital stock actually paid in and
    unimpaired plus 5 per centum of its unimpaired surplus fund.
    Notwithstanding any other provision in this paragraph, the
    association may purchase for its own account shares of stock
    issued by a corporation organized solely for the purpose of
    making loans to farmers and ranchers for agricultural purposes,
    including the breeding, raising, fattening, or marketing of
    livestock. However, unless the association owns at least 80 per
    centum of the stock of such agricultural credit corporation the
    amount invested by the association at any one time in the stock
    of such corporation shall not exceed 20 per centum of the
    unimpaired capital and surplus of the association: Provided
    further, That notwithstanding any other provision of this
    paragraph, the association may purchase for its own account
    shares of stock of a bank insured by the Federal Deposit
    Insurance Corporation or a holding company which owns or
    controls such an insured bank if the stock of such bank or
    company is owned exclusively (except to the extent directors'
    qualifying shares are required by law) by depository
    institutions or depository institution holding companies (as
    defined in section 3 of the Federal Deposit Insurance Act) and
    such bank or company and all subsidiaries thereof are engaged
    exclusively in providing services to or for other depository
    institutions, their holding companies, and the officers,
    directors, and employees of such institutions and companies,
    and in providing correspondent banking services at the request
    of other depository institutions or their holding companies
    (also referred to as a ``banker's bank''), but in no event
    shall the total amount of such stock held by the association in
    any bank or holding company exceed at any time 10 per centum of
    the associations capital stock and paid in and unimpaired
    surplus and in no event shall the purchase of such stock result
    in an association's acquiring more than 5 per centum of any
    class of voting securities of such bank or company. The
    limitations and restrictions contained in this paragraph as to
    an association purchasing for its own account investment
    securities shall not apply to securities that (A) are offered
    and sold pursuant to section 4(5) of the Securities Act of 1933
    (15 U.S.C. 77d(5)); (B) are small business related securities
    (as defined in section 3(a)(53) of the Securities Exchange Act
    of 1934); or (C) are mortgage related securities (as that term
    is defined in section 3(a)(41) of the Securities Exchange Act
    of 1934 (15 U.S.C. 78c(a)(41)). The exception provided for the
    securities described in subparagraphs (A), (B), and (C) shall
    be subject to such regulations as the Comptroller of the
    Currency may prescribe, including regulations prescribing
    minimum size of the issue (at the time of initial distribution)
    or minimum aggregate sales prices, or both. A national banking
    association may deal in, underwrite, and purchase for such
    association's own account qualified Canadian government
    obligations to the same extent that such association may deal
    in, underwrite, and purchase for such association's own account
    obligations of the United States or general obligations of any
    State or of any political subdivision thereof. For purposes of
    this paragraph--
              (1) the term ``qualified Canadian government
            obligations'' means any debt obligation which is backed
            by Canada, any Province of Canada, or any political
            subdivision of any such Province to a degree which is
            comparable to the liability of the United States, any
            State, or any political subdivision thereof for any
            obligation which is backed by the full faith and credit
            of the United States, such State, or such political
            subdivision, and such term includes any debt obligation
            of any agent of Canada or any such Province or any
            political subdivision of such Province if--
                      (A) the obligation of the agent is assumed in
                    such agent's capacity as agent for Canada or
                    such Province or such political subdivision;
                    and
                      (B) Canada, such Province, or such political
                    subdivision on whose behalf such agent is
                    acting with respect to such obligation is
                    ultimately and unconditionally liable for such
                    obligation; and
              (2) the term ``Province of Canada'' means a Province
            of Canada and includes the Yukon Territory and the
            Northwest Territories and their successors.
      (b) Interpretive Authority of the Comptroller of the
    Currency.--
              (1) In general.--Subject to paragraph (2), it shall
            not be incidental to banking for a national bank to
            provide insurance as a principal, agent, or broker.
              (2) Scope of application.--Notwithstanding paragraph
            (1), it shall be incidental to banking for a national
            bank to engage in the following activities:
                      (A) Providing, as an agent or broker, any
                    annuity contract the income on which is tax
                    deferred under section 72 of the Internal
                    Revenue Code of 1986.
                      (B) Providing, as a principal, agent, or
                    broker, any type of insurance, other than an
                    annuity or title insurance, which the
                    Comptroller of the Currency specifically
                    determined, before May 1, 1995, to be
                    incidental to banking with respect to national
                    banks.
    SEC. 5136A. STATE SUPERVISION OF INSURANCE.

      (a) State Licensing of Insurance Activities.--
              (1) In general.--Subject to paragraph (2), no
            provision of section 5136, any other section of this
            title, or section 13 of the Federal Reserve Act may be
            construed as limiting or otherwise impairing the
            authority of any State to regulate--
                      (A) the extent to which, and the manner in
                    which, a national bank may engage within the
                    State in insurance activities pursuant to
                    section 5136B of this chapter or section 13 of
                    the Federal Reserve Act;
                      (B) the manner in which a national bank may
                    engage within the State in insurance activities
                    pursuant to section 5136(b)(2)(B) of the
                    Revised Statutes of the United States; or
                      (C) the manner in which a national bank may
                    engage within the State in insurance activities
                    pursuant to section 5136(b)(2)(A) of the
                    Revised Statutes of the United States through,
                    and limited to, consumer disclosure
                    requirements or licensing requirements,
                    procedures, and qualifications as described in
                    paragraph (2)(C).
              (2) Prohibition on state discrimination against
            national banks.--Notwithstanding paragraph (1)--
                      (A) Providing insurance as agent or broker.--
                    No State may impose any insurance regulatory
                    requirement relating to providing insurance as
                    an agent or broker that treats a national bank
                    differently than all other persons who are
                    authorized to provide insurance as agents or
                    brokers in such State, unless there is a
                    legitimate and reasonable State regulatory
                    purpose for the requirement for which there is
                    no less restrictive alternative.
                      (B) Providing insurance as principal, agent,
                    or broker.--
                              (i) No State may impose on a national
                            bank any insurance regulatory
                            requirement relating to providing
                            insurance as principal, agent, or
                            broker that treats the national bank
                            more restrictively than any other
                            depository institution (as defined in
                            section 3(c)(1) of the Federal Deposit
                            Insurance Act, 12 U.S.C. 1813(c)(1))
                            operating in the State.
                              (ii) Nothing in this subparagraph
                            shall affect the validity of a State
                            law that--
                                      (I) prevents a national bank
                                    from engaging in insurance
                                    activities within the State to
                                    as great an extent as a savings
                                    association (as defined in
                                    section 3(b)(1) of the Federal
                                    Deposit Insurance Act, 12
                                    U.S.C. 1813(b)(1)) may engage
                                    in such activities within the
                                    State; and
                                      (II) was in effect on June 1,
                                    1995.
                      (C) Licensing qualifications and
                    procedures.--No State may discriminate against
                    a national bank with respect to the following
                    requirements, procedures, and qualifications as
                    such requirements, procedures, and
                    qualifications relate to the authority of the
                    national bank to provide insurance in such
                    State as an agent or broker:
                              (i) License application and
                            processing procedures.
                              (ii) Character, experience, and
                            educational qualifications for
                            licenses.
                              (iii) Testing and examination
                            requirements for licenses.
                              (iv) Fee requirements for licenses.
                              (v) Continuing education
                            requirements.
                              (vi) Types of licenses required.
                              (vii) Standards and requirements for
                            renewal of licenses.
      (b) Authority of the Comptroller of the Currency.--A national
    bank may not provide insurance as a principal, agent, or broker
    except as specifically provided in this section, the paragraph
    designated as the ``Seventh'' of section 5136(a) of this
    chapter, section 5136(b) or 5136B of this chapter, or section
    13 of the Federal Reserve Act.
      (c) Preservation of Federally Authorized Bank Activities in
    Permissive States.--No provision of this section may be
    construed as affecting the authority, pursuant to section 5136B
    of this chapter or section 13 of the Federal Reserve Act, of a
    national bank to act as insurance agent or broker consistent
    with State law.
      (d) Preservation of National Bank Authority Consistent With
    State Bank Authority.--Except as provided in subsection
    (a)(2)(B), no provision of this section or section 5136(b)(1)
    shall have the effect of enabling a State to deny a national
    bank authority that the bank otherwise possesses to provide a
    product in a State, including as agent, broker, or principal,
    where the bank is not providing the product in the State other
    than to an extent and in a manner that a State bank (as defined
    in section 3(a)(2) of the Federal Deposit Insurance Act, 12
    U.S.C. 1813(a)(2)) is permitted by the law of the State to
    provide such product, except that nothing in this subsection
    shall be construed as granting any new authority to a national
    bank to provide any product because the law of the State has
    authorized State banks to provide such product.
      (e) Definitions.--For purposes of this section, sections 5136
    and 5136B, and section 13 of the Federal Reserve Act, the
    following definitions shall apply:
              (1) Insurance.--The term ``insurance'' means any
            product defined or regulated as insurance, consistent
            with the relevant State insurance law, by the insurance
            regulatory authority of the State in which such product
            is sold, solicited, or underwritten, including any
            annuity contract the income on which is tax deferred
            under section 72 of the Internal Revenue Code of 1986.
              (2) State.--The term ``State'' has the same meaning
            as in section 3(a)(3) of the Federal Deposit Insurance
            Act.
      (f) Grandfather Provision.--
              (1) In general.--Any national bank which, before
            January 1, 1995, was providing insurance as agent or
            broker under section 13 of the Federal Reserve Act may
            provide insurance as an agent or broker under such
            section, to no less extent and in a no more restrictive
            manner as such bank was providing insurance as agent or
            broker under such section on January 1, 1995,
            notwithstanding contrary State law, subject to final,
            controlling judgment in a pending action.
              (2) Termination.--This subsection shall cease to
            apply with respect to any national bank described in
            paragraph (1) if--
                      (A) the bank is subject to an acquisition,
                    merger, consolidation, or change in control,
                    other than a transaction to which section
                    18(c)(12) of the Federal Deposit Insurance Act
                    applies; or
                      (B) any bank holding company which directly
                    or indirectly controls such bank is subject to
                    an acquisition, merger, consolidation, or
                    change in control, other than a transaction in
                    which the beneficial ownership of such bank
                    holding company or of a bank holding company
                    which controls such company does not change as
                    a result of the transaction.
      (g) Preservation of Banking Products.--Nothing in this
    section shall be construed as affecting the ability of a
    national bank, or a subsidiary of a national bank, to engage in
    any activity, including any activity authorized pursuant to the
    paragraph designated the ``Seventh'' of section 5136(a), that
    is part of, and not merely incidental to, the business of
    banking.
    SEC. 5136B. INSURANCE SALES IN EMPOWERMENT ZONES.

      (a) Authority to Sell Insurance as Agent From Empowerment
    Zones.--The Comptroller of the Currency may approve an
    application by a national bank maintaining a main office or
    full-service branch in an empowerment zone to act as an agent
    or broker from such office or branch for any fire, life, or
    other insurance company authorized to do business in the State
    in which the customer is located if--
              (1) the bank provides sufficient evidence that the
            availability of competitively priced insurance products
            in the empowerment zone is inadequate; and
              (2) the insurance products are sold only in the
            empowerment zone.
      (b) Application of State Law.--State laws which regulate
    conducting the business of insurance shall apply to national
    banks and their employees that sell insurance as agent or
    broker under this section to the same extent as such laws apply
    to other entities and persons not affiliated with depository
    institutions except--
              (1) in any case in which the Comptroller of the
            Currency determines, after notice to and comment by the
            appropriate State insurance officials, that the
            application of a State law would have an unreasonably
            discriminatory effect upon the sale of insurance by
            national banks or their employees in comparison with
            the effect the application of the State law would have
            with respect to sale of insurance by other entities; or
              (2) when State law by its own terms does not apply to
            national banks or employees of such banks.
      (c) Authority of Comptroller of the Currency.--
              (1) In general.--The Comptroller of the Currency may
            prescribe regulations governing sales of insurance by
            national banks pursuant to this section.
              (2) Enforcement of state law.--The provisions of any
            State law to which an national bank is subject under
            this section shall be enforced with respect to such
            bank by the Comptroller of the Currency.
      (d) Definitions.--
              (1) Empowerment zone.--The term ``empowerment zone''
            means an area that meets the standards for designation
            as an empowerment zone or enterprise community under
            section 1392 of the Internal Revenue Code of 1986 or an
            Indian reservation.
              (2) Full-service branch.--The term ``full-service
            branch'' means a staffed facility which has been
            approved as a branch and offers loan and deposit
            services.
              (3) Indian reservation.--The term ``Indian
            reservation'' has the meaning given such term by
            section 168(j)(6) of the Internal Revenue Code of 1986.
      Sec. [5136A.] 5136C. (a) A national bank may not--
              (1) deal in lottery tickets;
              (2) deal in bets used as a means or substitute for
            participation in a lottery;
              * * * * * * *
      Sec. 5146. Every director must during his whole term of
    service, be a citizen of the United States, and at least a
    majority of the directors must have resided in the State,
    Territory, or District in which the association is located, or
    within one hundred miles of the location of the office of the
    association, for at least one year immediately preceding their
    election, and must be residents of such State or within a one-
    hundred-mile territory of the location of the association
    during their continuance in office, except that (1) the
    Comptroller of the Currency may, in the Comptroller's
    discretion, waive the residency requirement in the case of any
    director of a national bank to whom the requirement would
    otherwise apply, and (2) in the case of an association which is
    a subsidiary or affiliate of a foreign bank, the Comptroller of
    the Currency may in his discretion waive the requirement of
    citizenship in the case of not more than a minority of the
    total number of directors. Every director must own in his or
    her own right either shares of the capital stock of the
    association of which he or she is a director the aggregate par
    value of which is not less than $1,000, or an equivalent
    interest, as determined by the Comptroller of the Currency, in
    any company which has control over such association within the
    meaning of section 2 of the Bank Holding Company Act of 1956
    (12 U.S.C. 1841). If the capital of the bank does not exceed
    $25,000, every director must own in his or her own right either
    shares of such capital stock the aggregate par value of which
    is not less than $500, or an equivalent interest, as determined
    by the Comptroller of the Currency, in any company which has
    control over such association within the meaning of section 2
    of the Bank Holding Company Act of 1956 (12 U.S.C. 1841). Any
    director who ceases to be the owner of the required number of
    shares of the stock, or who becomes in any other manner
    disqualified, shall thereby vacate his place.
              * * * * * * *
      Sec. 5155. The conditions upon which a national banking
    association may retain or establish and operate a branch or
    branches are the following:
      (a)  * * *
              * * * * * * *
      [(h) The aggregate capital of every national banking
    association and its branches shall at no time be less than the
    aggregate minimum capital required by law for the establishment
    of an equal number of national banking associations situated in
    the various places where such association and its branches are
    situated.
      [(i) No branch] (h) Relocation._
              (1) Approval required._Except as provided in
            paragraph (2), no branch of any national banking
            association shall be established or moved from one
            location to another without first obtaining the consent
            and approval of the Comptroller of the Currency.
              (2) No approval required for certain branches.--
            Notwithstanding this subsection or subsection (b) or
            (c), the consent and approval of the Comptroller of the
            Currency shall not be required for a national bank to
            establish and operate, or to retain and operate, a
            branch or seasonal agency if--
                      (A) the bank is well capitalized (as defined
                    in section 38 of the Federal Deposit Insurance
                    Act and regulations prescribed by the
                    Comptroller of the Currency under such
                    section);
                      (B) the bank received a composite CAMEL
                    rating of ``1'' or ``2'' under the Uniform
                    Financial Institutions Rating System (or an
                    equivalent rating under a comparable rating
                    system) as of its most recent examination;
                      (C) the bank did not receive a ``needs to
                    improve'' or ``substantial noncompliance''
                    composite rating at its most recent examination
                    under the Community Reinvestment Act of 1977;
                    and
                      (D) the Comptroller of the Currency is
                    otherwise authorized to grant approval under
                    this section to such bank to establish and
                    operate, or to retain and operate, a branch or
                    seasonal agency at the proposed location.
              (3) Certain branches deemed to have approved
            applications.--A branch or seasonal agency established
            by a national bank under paragraph (2) shall be deemed
            to have been established and operated pursuant to an
            application approved under this section.
      [(j) The term] (i) Branch.--
              (1) In general.--The term ``branch'' as used in this
            section shall be held to include any branch bank,
            branch office, branch agency, additional office, or any
            branch place of business located in any State or
            Territory of the United States or in the District of
            Columbia at which deposits are received, or checks
            paid, or money lent.
              (2) Certain proprietary atms and remote servicing
            units.--The term ``branch'' does not include any
            automated teller machine or remote service unit which
            is owned and operated by a depository institution--
                      (A) primarily for the benefit of the
                    institution and the affiliates of the
                    institution; and
                      (B) which could operate a branch at the
                    location of such machine or unit.
      [(k)] (j) This section shall not be construed to amend or
    repeal section 25 of the Federal Reserve Act, as amended,
    authorizing the establishment by national banking associations
    of branches in foreign countries, or dependencies, or insular
    possessions of the United States.
      [(l)] (k) The words ``State bank,'' ``State banks,''
    ``bank,'' or ``banks,'' as used in this section, shall be held
    to include trust companies, savings banks, or other such
    corporations or institutions carrying on the banking business
    under the authority of State laws.

    SEC. 5156A. MERGERS, CONSOLIDATIONS, AND OTHER ACQUISITIONS AUTHORIZED.

      (a)  * * *
      (b) Expedited Approval of Acquisitions.--
              (1) In general.--Any application by a national bank
            to acquire or be acquired by another insured depository
            institution which is required to be filed with the
            Comptroller of the Currency by [section 5(d)(3) of the
            Federal Deposit Insurance Act or] any other applicable
            law or regulation shall be approved or disapproved in
            writing by the agency before the end of the 60-day
            period beginning on the date such application is filed
            with the agency.
              * * * * * * *

                                 CHAPTER THREE

                       REGULATION OF THE BANKING BUSINESS

              * * * * * * *
      Sec. 5211. (a) Every association shall make reports of
    condition to the Comptroller of the Currency in accordance with
    the Federal Deposit Insurance Act. The Comptroller of the
    Currency may call for additional reports of condition, in such
    form and containing such information as he may prescribe, on
    dates to be fixed by him, and may call for special reports from
    any particular association whenever in his judgment the same
    are necessary for his use in the performance of his supervisory
    duties. Each report of condition shall contain a declaration by
    the president, a vice president, the cashier, or by any other
    officer designated by the board of directors of the bank to
    make such declaration, that the report is true and correct to
    the best of his knowledge and belief. [The correctness of the
    report of condition shall be attested by the signatures of
    least three of the directors of the bank other than the officer
    making such declaration, with the declaration that the report
    has been examined by them and to the best of their knowledge
    and belief is true and correct.] Each report shall exhibit in
    detail and under appropriate heads the resources and
    liabilities of the association at the close of business on any
    past day specified by the Comptroller, and shall be transmitted
    to the Comptroller within the period of time specified by the
    Comptroller. Special reports called for by the Comptroller need
    contain only such information as is specified by the
    Comptroller in his request therefore, and publication of such
    reports need to be made only if directed by the Comptroller.
              * * * * * * *
                                  ----------

                    SECTION 10 OF THE HOME OWNERS' LOAN ACT

    SEC. 10. REGULATION OF HOLDING COMPANIES.

      (a) Definitions.--
              (1) In general.--As used in this section, unless the
            context otherwise requires--
                      (A) * * *
              * * * * * * *
                      [(D) Savings and loan holding company.--The
                    term ``savings and loan holding company'' means
                    any company which directly or indirectly
                    controls a savings association or controls any
                    other company which is a savings and loan
                    holding company.]
                      (D) Savings and loan holding company.--
                              (i) In general.--Except as provided
                            in clause (ii), the term ``savings and
                            loan holding company'' means any
                            company which directly or indirectly
                            controls a savings association or
                            controls any other company which is a
                            savings and loan holding company.
                              (ii) Exception for bank holding
                            company.--The term ``savings and loan
                            holding company'' does not include any
                            company which is registered under, and
                            subject to, the provisions of the Bank
                            Holding Company Act of 1956, or any
                            company directly or indirectly
                            controlled by such company.
              * * * * * * *
      (m) Qualified Thrift Lender Test.--
              (1) In general.--Except as provided in paragraphs
            [(2) and (7)] (2), (7), and (8), any savings
            association is a qualified thrift lender if--
                      (A) the savings association's qualified
                    thrift investments equal or exceed 65 percent
                    of the savings association's portfolio assets;
                    and
                      (B) the savings association's qualified
                    thrift investments continue to equal or exceed
                    65 percent of the savings association's
                    portfolio assets on a monthly average basis in
                    9 out of every 12 months.
              * * * * * * *
              (8) Alternative test.--Any savings association which
            meets the requirements set forth in section
            7701(a)(19)(C) of the Internal Revenue Code of 1986
            shall be deemed to be a qualified thrift lender and any
            qualified thrift lender shall be deemed to meet the
            requirements of such section.
              * * * * * * *
      (t) Exemption for Bank Holding Companies.--This section shall
    not apply to a bank holding company that is subject to the Bank
    Holding Company Act of 1956 or any company controlled by such
    bank holding company (other than a savings association).
                                  ----------

                              FEDERAL RESERVE ACT

                             state banks as members

      Sec. 9. Any bank incorporated by special law of any State, or
    organized under the general laws of any State or of the United
    States, including Morris Plan banks and other incorporated
    banking institutions engaged in similar business, desiring to
    become a member of the Federal Reserve System, may make
    application to the Board of Governors of the Federal Reserve
    System, under such rules and regulations as it may prescribe,
    for the right to subscribe to the stock of the Federal reserve
    bank organized within the district in which the applying bank
    is located. Such application shall be for the same amount of
    stock that the applying bank would be required to subscribe to
    as a national bank. For the purposes of membership of any such
    bank the terms ``capital'' and ``capital stock'' shall include
    the amount of outstanding capital notes and debentures legally
    issued by the applying bank and purchased by the Reconstruction
    Finance Corporation. The Board of Governors of the Federal
    Reserve System, subject to the provisions of this Act and to
    such conditions as it may prescribe pursuant thereto may permit
    the applying bank to become a stockholder of such Federal
    reserve bank.
              * * * * * * *
      Any such State bank which, at the date of the approval of
    this Act, has established and is operating a branch or branches
    in conformity with the State law, may retain and operate the
    same while remaining or upon becoming a stockholder of such
    Federal reserve bank; but no such State bank may retain or
    acquire stock in a Federal reserve bank except upon
    relinquishment of any branch or branches established after the
    date of the approval of this Act beyond the limits of the city,
    town, or village in which the parent bank is situated.
    Provided, however, That nothing herein contained shall prevent
    any State member bank from establishing and operating branches
    in the United States or any dependency or insular possession
    thereof or in any foreign country, on the same terms and
    conditions and subject to the same limitations and restrictions
    as are applicable to the establishment of branches by national
    banks except that the approval of the Board of Governors of the
    Federal Reserve System, instead of the Comptroller of the
    Currency, shall be obtained before any State member bank may
    hereafter establish any branch and before any State bank
    hereafter admitted to membership may retain any branch
    established after February 25, 1927, beyond the limits of the
    city, town, or village in which the parent bank is situated.
    The approval of the Board shall likewise be obtained before any
    State member bank may establish any new branch within the
    limits of any such city, town, or village (except within the
    District of Columbia.) Notwithstanding the preceding 2
    sentences, the approval of the Board shall not be required for
    a State member bank to establish and operate a branch or
    seasonal agency if--
              (A) the State member bank is well-capitalized (as
            defined in section 38 of the Federal Deposit Insurance
            Act and regulations prescribed by the Board under such
            section);
              (B) the State member bank received a composite CAMEL
            rating of ``1'' or ``2'' under the Uniform Financial
            Institutions Rating System (or an equivalent rating
            under a comparable rating system);
              (C) the State member bank did not receive a ``needs
            to improve'' or ``substantial noncompliance'' composite
            rating at its most recent examination under the
            Community reinvestment Act; and
              (D) the Board is otherwise authorized to grant
            approval under this section to such State member bank
            to establish and operate a branch or seasonal agency at
            the proposed location.
    A branch or seasonal agency established by a State member bank
    under the previous sentence shall be deemed to have been
    established and operated pursuant to an application approved
    under this section.
              * * * * * * *

                        powers of federal reserve banks

      Sec. 13. Any Federal reserve bank may receive from any of its
    member banks or other depository institutions, and from the
    United States, deposits of current funds in lawful money,
    national-bank notes, Federal reserve notes, or checks, and
    drafts, payable upon presentation or other items, and also, for
    collection, maturing notes and bills; or, solely for purposes
    of exchange or of collection, may receive from other Federal
    reserve banks deposits of current funds in lawful money,
    national-bank notes, or checks upon other Federal reserve
    banks, and checks and drafts, payable upon presentation within
    its district or other items, and maturing notes and bills
    payable within its district; or, solely for the purposes of
    exchange or of collection, may receive from any nonmember bank
    or trust company or other depository institution deposits of
    current funds in lawful money, national-bank notes, Federal
    reserve notes, checks and drafts payable upon presentation or
    other items, or maturing notes and bills: Provided, Such
    nonmember bank or trust company or other depository institution
    maintains with the Federal reserve bank of its district a
    balance in such amount as the Board determines taking into
    account items in transit, services provided by the Federal
    Reserve bank, and other factors as the Board may deem
    appropriate: Provided further, That nothing in this or any
    other section of this Act shall be construed as prohibiting a
    member or nonmember bank or other depository institution from
    making reasonable charges, to be determined and regulated by
    the Board of Governors of the Federal Reserve System, but in no
    case to exceed 10 cents per $100 or fraction thereof, based on
    the total of checks and drafts presented at any one time, for
    collection or payment of checks and drafts and remission
    therefor by exchange or otherwise; but no such charges shall be
    made against the Federal reserve banks.
              * * * * * * *
      That in addition to the powers not vested by law in national
    banking associations organized under the laws of the United
    States, and subject to section 5136A of the Revised Statutes of
    the United States, any such association located and doing
    business in any place the population of which does not exceed
    five thousand inhabitants, as shown by the last preceding
    decennial census, may, under such rules and regulations as may
    be prescribed by the Comptroller of the Currency, act as the
    agent for any fire, life, or other insurance company authorized
    by the authorities of the State in which said bank is located
    to do business in said State, by soliciting and selling
    insurance and collecting premiums on policies issued by such
    company; and may receive for services so rendered such fees or
    commissions as may be agreed upon between the said association
    and the insurance company for which it may act as agent:
    Provided, however, That no such bank shall in any case assume
    or guarantee the payment of any premium on insurance policies
    issued through its agency by its principal: And provided
    further, That the bank shall not guarantee the truth of any
    statement made by an assured in filing his application for
    insurance.
              * * * * * * *
      Sec. 22. * * *
      (d) * * *
              * * * * * * *
      (g)(1) Except as authorized under this subsection, no member
    bank may extend credit in any manner to any of its own
    executive officers. No executive officer of any member bank may
    become indebted to that member bank except by means of an
    extension of credit which the bank is authorized to make under
    this subsection. Any extension of credit under this subsection
    shall be promptly reported to the board of directors of the
    bank, and may be made only if--
              (A) the bank would be authorized to make it to
            borrowers other than its officers;
              (B) it is on terms not more favorable than those
            afforded other borrowers;
              (C) the officer has submitted a detailed current
            financial statement; and
              (D) it is on condition that it shall become due and
            payable on demand of the bank at any time when the
            officer is indebted to any other bank or banks on
            account of extensions of credit [of any one of the
            three categories respectively referred to in paragraphs
            (2), (3), and (4)] of any category referred to in
            paragraph (2), (3), (4), (5), or (6) in an aggregate
            amount greater than the amount of credit of the same
            category that could be extended to him by the bank of
            which he is an officer.
              * * * * * * *
        (4) Home equity lines of credit.--A member bank may make a
    revolving open-end extension of credit to any executive officer
    of the bank if the credit--
              (A) does not exceed $100,000; and
              (B) is secured by a dwelling that is owned by such
            officer and used by the officer as a residence.
        (5) Loans secured by marketable assets.--A member bank may
    extend credit to any executive officer of the bank if the
    credit is secured by readily marketable assets of a value not
    exceeding such amount as the Board may establish by regulation.
      [(4)] (6) A member bank may make extensions of credit not
    otherwise specifically authorized under this subsection to any
    executive officer of the bank in an amount prescribed in a
    regulation of the member bank's appropriate Federal banking
    agency.
      [(5)] (7) Except to the extent permitted under paragraph
    [(4)] (6), a member bank may not extend credit to a partnership
    in which one or more of its executive officers are partners
    having either individually or together a majority interest. For
    the purposes of paragraph [(4)] (6), the full amount of any
    credit so extended shall be considered to have been extended to
    each officer of the bank who is a member of the partnership.
      [(6) Whenever an executive officer of a member bank becomes
    indebted to any bank or banks (other than the one of which he
    is an officer) on account of extensions of credit of any one of
    the three categories respectively referred to in paragraphs
    (2), (3) and (4) in an aggregate amount greater than the
    aggregate amount of credit of the same category that could
    lawfully be extended to him by the bank, he shall make a
    written report to the board of directors of the bank, stating
    the date and amount of each such extension of credit, the
    security therefor, and the purposes for which the proceeds have
    been or are to be used.]
      [(7)] (8) This subsection does not prohibit any executive
    officer of a member bank from endorsing or guaranteeing for the
    protection of the bank any loan or other asset previously
    acquired by the bank in good faith or from incurring any
    indebtedness to the bank for the purpose of protecting the bank
    against loss or giving financial assistance to it.
      [(8)] (9) Each day that any extension of credit in violation
    of this subsection exists is a continuation of the violation
    for the purposes of section 8 of the Federal Deposit Insurance
    Act.
      [(9) Each member bank shall include with (but not as part of)
    each report of condition and copy thereof filed under section
    7(a)(3) of the Federal Deposit Insurance Act a report of all
    loans under authority of this subsection made by the bank since
    its previous report of condition.]
      (10) The Board of Governors of the Federal Reserve System may
    prescribe such rules and regulations, including definitions of
    terms, as it deems necessary to effectuate the purposes and to
    prevent evasions of this subsection. (12 U.S.C. 375a).
      (h) Extensions of Credit to Executive Officers, Directors,
    and Principal Shareholders of Member Banks.--
              (1) * * *
              [(2) Preferential terms prohibited.--A member bank]
            (2) Preferential terms prohibited.--
                      (A) In general.--A member bank may extend
                    credit to its executive officers, directors, or
                    principal shareholders, or to any related
                    interest of such a person, only if the
                    extension of credit--
                              [(A)] (i) is made on substantially
                            the same terms, including interest
                            rates and collateral, as those
                            prevailing at the time for comparable
                            transactions by the bank with persons
                            who are not executive officers,
                            directors, principal shareholders, or
                            employees of the bank;
                              [(B)] (ii) does not involve more than
                            the normal risk of repayment or present
                            other unfavorable features; and
                              [(C)] (iii) the bank follows credit
                            underwriting procedures that are not
                            less stringent than those applicable to
                            comparable transactions by the bank
                            with persons who are not executive
                            officers, directors, principal
                            shareholders, or employees of the bank.
                      (B) Exception.--No provision of this
                    paragraph shall be construed as prohibiting
                    extensions of credit that constitute a benefit
                    or compensation program that is widely
                    available to and used by employees of the
                    member bank, including employees who are not
                    executive officers of the bank.
              * * * * * * *
              (8) Executive officer, director, or principal
            shareholder of certain affiliates treated as executive
            officer, director, or principal shareholder of member
            bank.--
                      (A) * * *
                      [(B) Exception.--The Board may, by
                    regulation, make exceptions to subparagraph
                    (A), except as that subparagraph makes
                    applicable paragraph (2), for an executive
                    officer or director of a subsidiary of a
                    company that controls the member bank, if that
                    executive officer or director does not have
                    authority to participate, and does not
                    participate, in major policymaking functions of
                    the member bank.]
                      (B) Exception.--The Board may, by regulation,
                    make exceptions to subparagraph (A) for an
                    executive officer or director of a subsidiary
                    of a company that controls the member bank if--
                              (i) the executive officer or director
                            does not have authority to participate,
                            and does not participate, in major
                            policymaking functions of the member
                            bank; and
                              (ii) the assets of such subsidiary do
                            not exceed 10 percent of the
                            consolidated assets of a company that
                            controls the member bank and such
                            subsidiary (and is not controlled by
                            any other company).
              * * * * * * *
              (10) Board's rulemaking authority.--The Board of
            Governors of the Federal Reserve System may prescribe
            such regulations, including definitions of terms, as it
            determines to be necessary to effectuate the purposes
            and prevent evasions of this subsection. The Board
            shall specify by regulation the recordkeeping required
            of member banks to ensure compliance with this section.
              * * * * * * *
      Sec. 24A. Hereafter no national bank, without the approval of
    the Comptroller of the Currency, and no State member bank,
    without the approval of the Board of Governors of the Federal
    Reserve System, shall (1) invest in bank premises, or in the
    stock, bonds, debentures, or other such obligations of any
    corporation holding the premises of such bank or (2) make loans
    to or upon the security of the stock of any such corporation,
    if the aggregate of all such investments and loans, together
    with the amount of any indebtedness incurred by any such
    corporation which is an affiliate of the bank, as defined in
    section 2 of the Banking Act of 1933, as amended, will exceed
    the amount of the capital stock of such bank or, in the case of
    a bank which received a composite CAMEL rating of ``1'' or
    ``2'' under the Uniform Financial Institutions Rating System
    (or an equivalent rating under a comparable rating system) as
    of its most recent examination and, both before and immediately
    following the investment or loan, is well capitalized (as
    defined under section 38 of the Federal Deposit Insurance Act),
    the amount which is equal to 150 percent of the capital stock
    and surplus of such bank.
              * * * * * * *

         banking corporations authorized to do foreign banking business

      Sec. 25A. Corporations to be organized for the purpose of
    engaging in international or foreign banking or other
    international or foreign financial operations, or in banking or
    other financial operations in a dependency or insular
    possession of the United States, either directly or through the
    agency, ownership, or control of local institutions in foreign
    countries, or in such dependencies or insular possessions as
    provided by this section, and to act when required by the
    Secretary of the Treasury as fiscal agents of the United
    States, may be formed by any number of natural persons, not
    less in any case than five: Provided, That nothing in this
    section shall be construed to deny the right of the Secretary
    of the Treasury to use any corporation organized under this
    section as depositaries in Panama and the Panama Canal Zone, or
    in the Philippine Islands and other insular possessions and
    dependencies of the United States.
              * * * * * * *
      No corporation shall be organized under the provisions of
    this section with a capital stock of less than $2,000,000, one-
    quarter of which must be paid in before the corporation may be
    authorized to begin business, and the remainder of the capital
    stock of such corporation shall be paid in installments of at
    least 10 per centum on the whole amount to which the
    corporation shall be limited as frequently as one installment
    at the end of each succeeding two months from the time of the
    commencement of its business operations until the whole of the
    capital stock shall be paid in: Provided, however, That
    whenever $2,000,000 of the capital stock of any corporation is
    paid in the remainder of the corporation's capital stock or any
    unpaid part of such remainder may, with the consent of the
    Board of Governors of the Federal Reserve System and subject to
    such regulations and conditions as it may prescribe, be paid in
    upon call from the board of directors; such unpaid
    subscriptions, however, to be included in the maximum of 10 per
    centum of the national bank's capital and surplus which a
    national bank is permitted under the provisions of this Act to
    hold in stock of corporations engaged in business of the kind
    described in this section and in section 25 of the Federal
    Reserve Act as amended. The capital stock of any such
    corporation may be increased at any time, with the approval of
    the Board of Governors of the Federal Reserve System, by a vote
    of two-thirds of its shareholders or by unanimous consent in
    writing of the shareholders without a meeting and without a
    formal vote, but any such increase of capital shall be fully
    paid in within ninety days after such approval; and may be
    reduced in like manner, provided that in no event shall it be
    less than $2,000,000. No corporation, except as herein
    provided, shall during the time it shall continue its
    operations, withdraw or permit to be withdrawn, either in the
    form of dividends or otherwise, any portion of its capital.
    [Any national banking association may invest in the stock of
    any corporation organized under the provisions of this section,
    but the aggregate amount of stock held in all corporations
    engaged in business of the kind described in this section and
    in section 25 of the Federal Reserve Act as amended shall not
    exceed 10 per centum of the subscribing bank's capital and
    surplus.] Any national bank may invest in the stock of any
    corporation organized under this section. The aggregate amount
    of stock held by any national bank in all corporations engaged
    in business of the kind described in this section or section 25
    shall not exceed an amount equal to 10 percent of the capital
    and surplus of such bank unless the Board determines that the
    investment of an additional amount by the bank would not be
    unsafe or unsound and, in any case, shall not exceed an amount
    equal to 25 percent of the capital and surplus of such bank.
              * * * * * * *
                                  ----------

                  SECTION 107 OF THE FEDERAL CREDIT UNION ACT

                                     powers

      Sec. 107. A Federal credit union shall have succession in its
    corporate name during its existence and shall have power--
              (1) * * *
              * * * * * * *
              (5) to make loans, the maturities of which shall not
            exceed twelve years except as otherwise provided
            herein, and extend lines of credit to its members, to
            other credit unions, and to credit union organizations
            and to participate with other credit unions, credit
            union organizations, or financial organizations in
            making loans to credit union members in accordance with
            the following:
                      (A) Loans to members shall be made in
                    conformity with criteria established by the
                    board of directors: Provided, That--
                              (i) * * *
              * * * * * * *
                              (iv) a loan or aggregate of loans to
                            a director or member of the supervisory
                            or credit committee of the credit union
                            making the loan which exceeds [$10,000]
                            $50,000 plus pledged shares, be
                            approved by the board of directors;
                              (v) loans to other members for which
                            directors or members of the supervisory
                            or credit committee act as guarantor or
                            endorser be approved by the board of
                            directors when such loans standing
                            alone or when added to any outstanding
                            loan or loans of the guarantor or
                            endorser exceeds [$10,000] $50,000;
              * * * * * * *
                                  ----------

                DEPOSITORY INSTITUTION MANAGEMENT INTERLOCKS ACT

      Sec. 203. (a) Prohibitions.--A management official of a
    depository institution or a depository holding company may not
    serve as a management official of any other depository
    institution or depository holding company not affiliated
    therewith if an office of one of the institutions or any
    depository institution that is an affiliate of such
    institutions is located within either--
              (1) the same primary metropolitan statistical area,
            the same metropolitan statistical area, or the same
            consolidated metropolitan statistical area that is not
            comprised of designated primary metropolitan
            statistical areas as defined by the Office of
            Management and Budget, except in the case of depository
            institutions with less than $20,000,000 in assets in
            which case the provision of paragraph (2) shall apply,
            as that in which an office of the other institution or
            any depository institution that is an affiliate of such
            institution is located, or
              (2) the same city, town, or village as that in which
            an office of the other institution or any depository
            institution that is an affiliate of such other
            institution is located, or in any city, town, or
            village contiguous or adjacent thereto.
      (b) Small Market Share Exemption.--
              (1) In general.--This section shall not be construed
            as prohibiting a management official of a depository
            institution or depository holding company from serving
            as a management official of another depository
            institution or depository holding company not
            affiliated with such institution or holding company if
            the depository institutions or depository holding
            companies with which the management official serves
            hold, together with all the affiliates of such
            institutions or holding companies, in the aggregate no
            more that 20 percent of the deposits in each relevant
            geographic banking market where offices of the
            depository institutions or depository holding companies
            or their affiliates are located.
              (2) Relevant geographic banking market defined.--For
            purposes of paragraph (1), the term ``relevant
            geographic banking market'' means--
                      (A) the area defined by the boundaries
                    identified by the Board of Governors of the
                    Federal Reserve System;
                      (B) if the Board has not defined such
                    boundaries, the area defined by the boundaries
                    of the Ranally Metropolitan Area in which the
                    office of the depository institution or the
                    depository institution holding company is
                    located; and
                      (C) if the office of such institution or
                    company is not located within a Ranally
                    Metropolitan Area, the area defined by the
                    county (or an equivalent area of general local
                    government) in which such office is located.
      [Sec. 204. If a depository institution or a depository
    holding company has total assets exceeding $1,000,000,000, a
    management official of such institution or any affiliate
    thereof may not serve as a management official of any other
    nonaffiliated depository institution or depository holding
    company having total assets exceeding $500,000,000 or as a
    management official of any affiliate of such other
    institution.]
    SEC. 204. DUAL SERVICE AMONG LARGER ORGANIZATIONS.

      (a) In General.--If a depository institution, depository
    institution holding company, or depository institution
    affiliate of any such institution or company has total assets
    exceeding $2,500,000,000, a management official of such
    institution, company, or affiliate may not serve as a
    management official of any other depository institution,
    depository institution holding company, or depository
    institution affiliate of any such institution or company
    which--
              (1) is not an affiliate of the institution, company,
            or affiliate of which such person is a management
            official; and
              (2) has total assets exceeding $1,500,000,000.
      (b) CPI Adjustments.--The dollar amounts in this section
    shall be adjusted annually after December 31, 1994, by the
    annual percentage increase in the Consumer Price Index for
    Urban Wage Earners and Clerical Workers published by the Bureau
    of Labor Statistics.
              * * * * * * *
      Sec. 206. (a) A person whose service in a position as a
    management official began prior to the date of enactment of
    this title and who was not immediately prior to the date of
    enactment of this title in violation of section 8 of the
    Clayton Act is not prohibited by section 203 or section 204 of
    this title from continuing to serve in that position [for a
    period of, subject to the requirements of subsection (c), 20
    years after the date of enactment of this title]. The
    appropriate Federal depository institutions regulatory agency
    may provide a reasonable period of time for compliance with
    this title, not exceeding fifteen months, after any change in
    circumstances which makes service described in the preceding
    sentence prohibited by this title, except that a merger,
    acquisition, increase in total assets, establishment of one or
    more offices, or change in management responsibilities shall
    not constitute changes in circumstances which would make such
    service prohibited by section 203 or section 204 of this title.
      (b) Effective on the date of enactment of this title, a
    person who serves as a management official of a company which
    is not a depository institution or a depository holding company
    and as a management official of that depository institution or
    depository holding company as a result of that company which is
    not a depository institution or depository holding company
    becoming a diversified savings and loan holding company as that
    term is defined in section 408(a) of the National Housing Act.
    [This subsection shall expire, subject to the requirements of
    subsection (c), 20 years after the date of enactment of this
    title.
      [(c) Review of Existing Management Interlocks.--Upon the
    timely filing of a submission by a person petitioning to serve
    as a management official in more than 1 position pursuant to
    subsection (a) or (b), each appropriate Federal depository
    institutions regulatory agency shall, not later than 6 months
    after the date of enactment of this Act--
              [(1) review, on a case-by-case basis, the
            circumstances under which such person has served as a
            management official under the provisions of subsection
            (a) or (b); and
              [(2) permit the management official to continue to
            serve in such position only if--
                      [(A) such person has provided a resolution
                    from the boards of directors of each affected
                    depository institution, depository holding
                    company, or company described in subsection
                    (b), certifying to the appropriate Federal
                    depository institutions regulatory agency for
                    each of the institutions involved that there is
                    no other qualified candidate from the community
                    described in paragraph (1) or (2) of section
                    203 who--
                              [(i) possesses the level of expertise
                            necessary for such service with respect
                            to the affected depository institution,
                            depository holding company, or company
                            described in subsection (b); and
                              [(ii) is willing to serve as a
                            management official at the affected
                            depository institution, depository
                            holding company, or company described
                            in subsection (b); and
                      [(B) the appropriate Federal depository
                    institutions regulatory agency determines that
                    continuation of service by the management
                    official does not produce an anticompetitive
                    effect with respect to each affected depository
                    institution, depository holding company, or
                    company described in subsection (b).]
              * * * * * * *
      Sec. 209. [(a) In General.--] Rules and regulations to carry
    out this title, including rules or regulations which permit
    service by a management official which would otherwise be
    prohibited by section 203 or section 204, may be prescribed
    by--
              (1) * * *
              * * * * * * *
      [(b) Regulatory Standards.--An appropriate Federal depository
    institution regulatory agency may permit, on a case-by-case
    basis, service by a management official which would otherwise
    be prohibited by section 203 or 204 only if--
              [(1) the board of directors of the affected
            depository institution, depository institution holding
            company, or company described in section 206(b),
            provides a resolution to the appropriate Federal
            depository institutions regulatory agency certifying
            that there is no other candidate from the community
            described in paragraph (1) or (2) of section 203 who--
                      [(A) possesses the level of expertise
                    necessary for such service with respect to the
                    affected depository institution, depository
                    institution holding company, or company
                    described in section 206(b) and is not
                    prohibited from service under section 203 or
                    204; and
                      [(B) is willing to serve as a management
                    official at the affected depository
                    institution, depository institution holding
                    company, or company described in section
                    206(b); and
              [(2) the appropriate Federal depository institutions
            regulatory agency determines that--
                      [(A) the management official is critical to
                    the safe and sound operations of the affected
                    depository institution, depository institution
                    holding company, or company described in
                    section 206(b);
                      [(B) continuation of service by the
                    management official does not produce an
                    anticompetitive effect with respect to the
                    affected depository institution, depository
                    institution holding company, or company
                    described in section 206(b); and
                      [(C) the management official meets such
                    additional requirements as the agency may
                    impose.
      [(c) Limited Exception for Management Official Consignment
    Program.--
              [(1) In general.--Notwithstanding the requirements of
            subsection (b), an appropriate Federal depository
            institutions regulatory agency may establish a program
            to permit, on a case-by-case basis, service by a
            management official which would otherwise be prohibited
            by section 203 or 204, for a period of not more than 2
            years, if the agency determines that such service
            would--
                      [(A) improve the provision of credit to low-
                    and moderate-income areas;
                      [(B) increase the competitive position of
                    minority- and woman-owned institutions; or
                      [(C) strengthen the management of newly
                    chartered institutions that are in an unsafe or
                    unsound condition.
              [(2) Extension of service period.--The appropriate
            Federal depository institutions regulatory agency may
            extend the 2-year period referred to in paragraph (1)
            for one additional period of not more than 2 years,
            subject to making a new determination described in
            subparagraphs (A) through (C) of paragraph (1).]
              * * * * * * *
                                  ----------

         SECTION 106 OF THE BANK HOLDING COMPANY ACT AMENDMENTS OF 1970

        Sec. 106. (a) * * *
        (b)(1) * * *
        (2)(A) * * *
              * * * * * * *
        [(G)(i) Each executive officer and each stockholder of
    record who directly or indirectly owns, controls, or has the
    power to vote more than 10 per centum of any class of voting
    securities of an insured bank shall make a written report to
    the board of directors of such bank for any year during which
    such executive officer or shareholder has outstanding an
    extension of credit from a bank which maintains a corresponding
    account in the name of such bank. Such report shall include the
    following information:
              [(1) the maximum amount of indebtedness to the bank
            maintaining the correspondent account during such year
            of (a) such executive officer or stockholder of record,
            (b) each company controlled by such executive officer
            or stockholder, or (c) each political or campaign
            committee the funds or services of which will benefit
            such executive officer or stockholder, or which is
            controlled by such executive officer or stockholder;
              [(2) the amount of indebtedness to the bank
            maintaining the correspondent account outstanding as of
            a date not more than ten days prior to the date of
            filing of such report of (a) such executive officer or
            stockholder of record, (b) each company controlled by
            such executive officer or stockholder, or (c) each
            political or campaign committee the funds or services
            of which will benefit such executive officer or
            stockholder;
              [(3) the range of interest rates charged on such
            indebtedness of such executive officer or stockholder
            of record; and
              [(4) the terms and conditions of such indebtedness of
            such executive officer or stockholder of record.
        [(ii) The appropriate Federal banking agencies are
    authorized to issue rules and regulations, including
    definitions of terms, to require the reporting and public
    disclosure of information by any bank or executive officer or
    principal shareholder thereof concerning any extension of
    credit by a correspondent bank to the reporting bank's
    executive officers or principal shareholders, or the related
    interests of such persons.]
        [(H) (G) For the purpose of this paragraph--
              [(i) the term ``bank'' includes a mutual savings
            bank, a savings bank, and a savings association (as
            those terms are defined in section 3 of the Federal
            Deposit Insurance Act);
              (ii) the term ``related interests of such persons''
            includes any company controlled by such executive
            officer, director, or person, or nay political or
            campaign committee the funds or services of which will
            benefit such executive officer, director, or person or
            which is controlled by such executive officer,
            director, or person; and
              (iii) the terms ``control of a company'' and
            ``company'' have the same meaning as under section
            22(h) of the Federal Reserve Act (12 U.S.C. 375b).
        [(I)] (H) Notice under this section after separation from
    service.--The resignation, termination of employment or
    participation, or separation of an institution-affiliated party
    (within the meaning of section 3(u) of the Federal Deposit
    Insurance Act) with respect to such a bank (including a
    separation caused by the closing of such a bank) shall not
    affect the jurisdiction and authority of the appropriate
    Federal banking agency to issue any notice and proceed under
    this section against any such party, if such notice is served
    before the end of the 6-year period beginning on the date such
    party ceased to be such a party with respect to such bank
    (whether such date occurs before, on, or after the date of the
    enactment of this subparagraph).
              * * * * * * *
                                  ----------

               SECTION 1115 OF THE RIGHT TO FINANCIAL PRIVACY ACT

                               cost reimbursement

        Sec. 1115. (a) Except for records obtained pursuant to
    section 1103(d) or 1113 (a) through (h), or as otherwise
    provided by law, a Government authority shall pay to the
    financial institution assembling or providing financial records
    pertaining to a customer (including corporate customers) and in
    accordance with procedures established by this title a fee for
    reimbursement for such costs as are reasonably necessary and
    which have been directly incurred in searching for,
    reproducing, or transporting books, papers, records, or other
    data required or requested to be produced. The Board of
    Governors of the Federal Reserve System shall, by regulation,
    establish the rates and conditions under which such payment may
    be made.
        (b) This section shall take effect on October 1, 1979.
                                  ----------

                   CHAPTER 53 OF TITLE 31, UNITED STATES CODE

                       CHAPTER 53--MONETARY TRANSACTIONS
         * * * * * * *

     SUBCHAPTER II--RECORDS AND REPORTS ON MONETARY INSTRUMENTS TRANSACTIONS

    5311.  Declaration of purpose.
         * * * * * * *
    [5327.  Identification of financial institutions.]
    5327.  Identification of foreign nonbank financial institutions.
         * * * * * * *
    Sec. 5327. Identification of foreign nonbank financial institutions

      (a) Regulations Required.--The Secretary of the Treasury
    shall prescribe regulations requiring each depository
    institution to identify any customer (of the depository
    institution) which--
              [(1) is a financial institution described in--
                      [(A) any subparagraph of section 5312(a)(2)
                    other than subparagraphs (A) through (G); or
                      [(B) any regulation under any such
                    subparagraph; and]
              (1) is a financial institution (other than a foreign
            bank (as defined in section 101(b) of the International
            Banking Act of 1978)) which is a foreign person; and
              * * * * * * *
                                  ----------

        SECTION 905 OF THE INTERNATIONAL LENDING SUPERVISION ACT OF 1983

                                    reserves

      Sec. 905. (a)(1) Each appropriate Federal banking agency
    [shall] may require a banking institution to establish and
    maintain a special reserve whenever, in the judgment of such
    appropriate Federal banking agency--
              (A) the quality of such banking institution's assets
            has been impaired by a protracted inability of public
            or private borrowers in a foreign country to make
            payments on their external indebtedness as indicated by
            such factors, among others, as--
                      (i) a failure by such public or private
                    borrowers to make full interest payments on
                    external indebtedness;
                      (ii) a failure to comply with the terms of
                    any restructured indebtedness; or
                      (iii) a failure by the foreign country to
                    comply with any International Monetary Fund or
                    other suitable adjustment program; or
              (B) no definite prospects exist for the orderly
            restoration of debt service.
              * * * * * * *
      (b) The appropriate Federal banking agencies [shall] may
    analyze the results of foreign loan rescheduling negotiations,
    assess the loan loss risk reflected in rescheduling agreements,
    and, using the powers set forth in section 908 (regarding
    capital adequacy), ensure that the capital and reserve
    positions of United States banks are adequate to accommodate
    potential losses on their foreign loans.
              * * * * * * *

               SECTION 7 OF THE INTERNATIONAL BANKING ACT OF 1978

                      authority of federal reserve system

      Sec. 7. (a) * * *
              * * * * * * *
      (c)
              (1) Examination of branches, agencies, and
            affiliates.--
                      (A) In general.--The Board may examine each
                    branch or agency of a foreign bank, each
                    commercial lending company or bank controlled
                    by 1 or more foreign banks or 1 or more foreign
                    companies that control a foreign bank, and
                    other office or affiliate of a foreign bank
                    conducting business in any State.
                      (B) Coordination of examinations.--
                              (i) In general.--The Board shall
                            coordinate examinations under this
                            paragraph with the Comptroller of the
                            Currency, the Federal Deposit Insurance
                            Corporation, and appropriate State bank
                            supervisors to the extent such
                            coordination is possible.
                              (ii) Simultaneous examinations.--The
                            Board may request simultaneous
                            examinations of each office of a
                            foreign bank and each affiliate of such
                            bank operating in the United States.
                              (iii) Avoidance of duplication.--In
                            exercising its authority under this
                            paragraph, the Board shall take all
                            reasonable measures to reduce burden
                            and avoid unnecessary duplication of
                            examinations.
                      [(C) Annual on-site examination.--Each branch
                    or agency of a foreign bank shall be examined
                    at least once during each 12-month period
                    (beginning on the date the most recent
                    examination of such branch or agency ended) in
                    an on-site examination.
                      [(D) Cost of examinations.--The cost of any
                    examination under subparagraph (A) shall be
                    assessed against and collected from the foreign
                    bank or the foreign company that controls the
                    foreign bank, as the case may be.]
                      (C) On-site examination.--Each Federal branch
                    or agency, and each State branch or agency, of
                    a foreign bank shall be subject to on-site
                    examination by a Federal banking agency or
                    State bank supervisor as frequently as would a
                    national bank or State bank, respectively, by
                    its appropriate Federal banking agency.
                      (D) Cost of examinations.--The cost of any
                    examination undertaken pursuant to subparagraph
                    (A) shall be assessed against and collected
                    from the foreign bank or the foreign company
                    that controls the foreign bank, as the case may
                    be, but only to the same extent that fees are
                    collected by the Board for examination of any
                    State member insured bank.
      (d) Establishment of Foreign Bank Offices in the United
    States.--
              (1) Prior approval required.--No foreign bank may
            establish a branch or an agency, or acquire ownership
            or control of a commercial lending company, without the
            prior approval of the Board.
              (2) Required standards for approval.--[The] Except as
            provided in paragraph (6), the Board may not approve an
            application under paragraph (1) unless it determines
            that--
                      (A) the foreign bank engages directly in the
                    business of banking outside of the United
                    States and is subject to comprehensive
                    supervision or regulation on a consolidated
                    basis by the appropriate authorities in its
                    home country; and
                      (B) the foreign bank has furnished to the
                    Board the information it needs to adequately
                    assess the application.
              * * * * * * *
              (5) Establishment of conditions.--[Consistent with
            the standards for approval in paragraph (2), the] The
            Board may impose such conditions on its approval under
            this subsection as it deems necessary.
              (6) Exception.--
                      (A) In general.--If the Board is unable to
                    find under paragraph (2) that a foreign bank is
                    subject to comprehensive supervision or
                    regulation on a consolidated basis by the
                    appropriate authorities in its home country,
                    the Board may nevertheless approve an
                    application under paragraph (1) by such foreign
                    bank if--
                              (i) the appropriate authorities in
                            the home country of such foreign bank
                            are working to establish arrangements
                            for the consolidated supervision of
                            such bank; and
                              (ii) all other factors are consistent
                            with approval.
                      (B) Additional conditions.--The Board, after
                    requesting and considering the views of the
                    appropriate State bank supervisor or the
                    Comptroller of the Currency, as the case may
                    be, may impose such conditions or restrictions
                    relating to activities or business operations
                    of the proposed branch, agency, or commercial
                    lending company subsidiary, including
                    restrictions on sources of funding, as are
                    considered appropriate in the public interest.
                      (C) Modification of conditions.--Any
                    condition or restriction imposed by the Board
                    under this subsection in connection with the
                    approval of an application may be varied or
                    withdrawn where such modification is consistent
                    with the public interest.
              (7) Time period for board action.--
                      (A) Final action.--The Board shall take final
                    action on any application under paragraph (1)
                    within 180 days of receipt of the application,
                    except that the Board may extend for 180 days
                    the period within which to take final action on
                    such application, after providing notice of,
                    and the reasons for, the extension to the
                    applicant foreign bank and any appropriate
                    State bank supervisor or the Comptroller of the
                    Currency, as the case may be.
                      (B) Failure to submit information.--The Board
                    may deny any application if it has not received
                    information requested from the applicant
                    foreign bank or appropriate authorities in the
                    home country in sufficient time to permit the
                    Board to evaluate such information adequately
                    within the time periods for final action set
                    forth in subparagraph (A).
                      (C) Waiver.--A foreign bank may waive the
                    applicability of subparagraph (A) with respect
                    to any such application.
      (e) Termination of Foreign Bank Offices in the United
    States.--
              (1) Standards for termination.--The Board, after
            notice and opportunity for hearing and notice to any
            appropriate State bank supervisor or the Comptroller of
            the Currency, may order a foreign bank that operates a
            State branch or agency or commercial lending company
            subsidiary or a Federal branch or agency in the United
            States to terminate the activities of such branch,
            agency, or subsidiary if the Board finds that--
                      (A)(i) the foreign bank is not subject to
                    comprehensive supervision or regulation on a
                    consolidated basis by the appropriate
                    authorities in its home country; [or] and
                      (ii) the appropriate authorities in the home
                    country are not making progress in establishing
                    arrangements for the comprehensive supervision
                    or regulation of such foreign bank on a
                    consolidated basis; or
                      (B)(i) there is reasonable cause to believe
                    that such foreign bank, or any affiliate of
                    such foreign bank, has committed a violation of
                    law or engaged in an unsafe or unsound banking
                    practice in the United States; and
                      (ii) as a result of such violation or
                    practice, the continued operation of the
                    foreign bank's branch, agency or commercial
                    lending company subsidiary in the United States
                    would not be consistent with the public
                    interest or with the purposes of this Act, the
                    Bank Holding Company Act of 1956, or the
                    Federal Deposit Insurance Act.
            However, in making findings under this paragraph, the
            Board shall not make size the sole determinant factor,
            and may take into account the needs of the community as
            well as the length of operation of the foreign bank and
            its relative size in its home country. Nothing in this
            paragraph shall affect the ability of the Board to
            order a State branch, agency, or commercial lending
            company subsidiary or a Federal branch or agency to
            terminate its activities in the United States pursuant
            to any standard set forth in this Act.
              * * * * * * *
              [(5) Recommendation to agency for termination of a
            federal branch or agency.--The Board may transmit to
            the Comptroller of the Currency a recommendation that
            the license of any Federal branch or Federal agency of
            a foreign bank be terminated in accordance with section
            4(i) if the Board has reasonable cause to believe that
            such foreign bank or any affiliate of such foreign bank
            has engaged in conduct for which the activities of any
            State branch or agency may be terminated under
            paragraph (1).]
              [(6)] (5) Enforcement of orders.--
                      (A) In general.--In the case of contumacy of
                    any office or subsidiary of the foreign bank
                    against which--
                              (i) the Board has issued an order
                            under paragraph (1); or
                              (ii) the Comptroller of the Currency
                            has issued an order under section 4(i),
                    or a refusal by such office or subsidiary to
                    comply with such order, the Board or the
                    Comptroller of the Currency may invoke the aid
                    of the district court of the United States
                    within the jurisdiction of which the office or
                    subsidiary is located.
                      (B) Court order.--Any court referred to in
                    subparagraph (A) may issue an order requiring
                    compliance with an order referred to in
                    subparagraph (A).
              [(7)] (6) Criteria relating to foreign supervision.--
            Not later than 1 year after the date of enactment of
            this subsection, the Board, in consultation with the
            Secretary of the Treasury, shall develop and publish
            criteria to be used in evaluating the operation of any
            foreign bank in the United States that the Board has
            determined is not subject to comprehensive supervision
            or regulation on a consolidated basis. In developing
            such criteria, the Board shall allow reasonable
            opportunity for public review and comment.
              * * * * * * *
                                  ----------

                  SECTION 1306 OF TITLE 18, UNITED STATES CODE

    Sec. 1306. Participation by financial institutions

      Whoever knowingly violates section [5136A] 5136C of the
    Revised Statutes of the United States, section 9A of the
    Federal Reserve Act, or section 20 of the Federal Deposit
    Insurance Act shall be fined under this title or imprisoned not
    more than one year, or both.
                                  ----------

                          BANK SERVICE CORPORATION ACT

                          short title and definitions

      Section 1. [(a) This Act may be cited as the ``Bank Service
    Corporation Act''.]
      (a) Short Title.--This Act may be cited as the ``Bank Service
    Company Act''.
      (b) For the purpose of this Act--
      (1) the term ``appropriate Federal banking agency'' shall
    have the meaning provided in section 3(q) of the Federal
    Deposit Insurance Act (12 U.S.C. 1813(q));
      [(2) the term ``bank service corporation'' means a
    corporation organized to perform services authorized by this
    Act, all of the capital stock of which is owned by one or more
    insured banks;]
      (2) the term ``bank service company'' means--
              (A) any corporation--
                      (i) which is organized to perform services
                    authorized by this Act; and
                      (ii) all of the capital stock of which is
                    owned by 1 or more insured banks; and
              (B) any limited liability company--
                      (i) which is organized to perform services
                    authorized by this Act; and
                      (ii) all of the members of which are 1 or
                    more insured banks.
              * * * * * * *
      (6) the term ``invest'' includes any advance of funds to a
    bank service [corporation] company, whether by the purchase of
    stock, the making of a loan, or otherwise, except a payment for
    rent earned, goods sold and delivered, or services rendered
    prior to the making of such payment; [and]
      (7) the term ``limited liability company'' means any company
    organized under the law of a State (as defined in section 3 of
    the Federal Deposit Insurance Act) which provides that a member
    or manager of such company is not personally liable for a debt,
    obligation, or liability of the company solely by reason of
    being, or acting as, a member or manager of such company; and
      [(7)] (8) the term ``principal investor'' means the insured
    bank that has the largest dollar amount invested in the
    [capital stock] equity of a bank service [corporation] company.
    In any case where two or more insured banks have equal dollar
    amounts invested in a bank service [corporation] company, the
    [corporation] company shall, prior to commencing operations,
    select one of the insured banks as its principal investor and
    shall notify the bank's appropriate Federal banking agency of
    that choice within 5 business days of its selection.

           amount of investment in bank service [corporation] company

      Sec. 2. Notwithstanding any limitation or prohibition
    otherwise imposed by any provision of law exclusively relating
    to banks, an insured bank may invest not more than 10 per
    centum of paid-in and unimpaired capital and unimpaired surplus
    in a bank service [corporation] company. No insured bank shall
    invest more than 5 per centum of its total assets in bank
    service [corporation] companies.

         permissible bank service [corporation] company activities for
                            depository institutions

      Sec. 3. Without regard to the provisions of sections 4 and 5
    of this Act, an insured bank may invest in a bank service
    [corporation] company that performs, and a bank service
    [corporation] company may perform, the following services only
    for depository institutions: check and deposit sorting and
    posting, computation and posting of interest and other credits
    and charges, preparation and mailing of checks, statements,
    notices, and similar items, or any other clerical, bookkeeping,
    accounting, statistical, or similar functions performed for a
    depository institution.

      permissible bank service [corporation] company activities for other
                                    persons

      Sec. 4. (a) A bank service [corporation] company may provide
    to any person any service authorized by this section, except
    that a bank service [corporation] company shall not take
    deposits.
      (b) Except with the prior approval of the Board under section
    5(b) of this Act in accordance with subsection (f) of this
    section--
              (1) a bank service [corporation] company shall not
            perform the services authorized by this section in any
            State other than that State in which its shareholders
            or members are located; and
              (2) all insured bank shareholders or members of a
            bank service [corporation] company shall be located in
            the same State.
      (c) A bank service [corporation] company in which a State
    bank is a shareholder or member shall perform only those
    services that such State bank shareholder or member is
    authorized to perform under the law of the State in which such
    State bank operates and shall perform such services only at
    locations in the State in which such State bank shareholder or
    member could be authorized to perform such services.
      (d) A bank service [corporation] company in which a national
    bank is a shareholder or member shall perform only those
    services that such national bank shareholder or member is
    authorized to perform under the law of the United States and
    shall perform such services only at locations in the State at
    which such national bank shareholder or member could be
    authorized to perform such services.
      (e) A bank service [corporation] company that has both
    national bank and State bank shareholders or members shall
    perform only those services that may lawfully be performed by
    both [its national bank shareholder or shareholders] any
    shareholder or member of the company which is a national bank
    under the law of the United States and [its State bank
    shareholder or shareholders] any shareholder or member of the
    company which is a State bank under the law of the State in
    which [such State bank or banks] any such State bank operate
    and shall perform such services only at location in the State
    at which both its State bank and national bank shareholders or
    members could be authorized to perform such services.
      (f) Notwithstanding the other provisions of this section or
    any other provision of law, other than the provisions of
    Federal and State branching law regulating the geographic
    location of banks to the extent that those laws are applicable
    to an activity authorized by this subsection, a bank service
    [corporation] company may perform at any geographic location
    any service, other than deposit taking company, that the Board
    has determined, by regulation, to be permissible for a bank
    holding company under section 4(c)(8) of the Bank Holding
    Company Act.

    prior approval for investments in bank service [corporations] companies

      Sec. 5. (a) No insured bank shall invest in the capital stock
    of a bank service [corporation] company that performs any
    service under authority of subsection (c), (d), or (e) of
    section 4 of this Act without prior notice, as determined by
    the bank's appropriate Federal banking agency.
      (b) No insured bank shall invest in the capital stock of a
    bank service [corporation] company that performs any service
    under authority of section 4(f) of this Act and no bank service
    [corporation] company shall perform any activity under section
    4(f) of this Act without the prior approval of the Board.
      (c) In determining whether to approve or deny any application
    for prior approval or whether to approve or disapprove any
    notice under this section, the Board or the appropriate Federal
    banking agency, as the case may be, is authorized to consider
    the financial and managerial resources and future prospects of
    the bank or banks and bank service [corporation] company
    involved, including the financial capability of the bank to
    make a proposed investment under this Act, and possible adverse
    effects such as undue concentration of resources, unfair or
    decreased competition, conflicts of interest, or unsafe or
    unsound banking practices.
      (d) In the event the Board or the appropriate Federal banking
    agency, as the case may be, fails to act on any application
    under this section within ninety days of the submission of a
    complete application to the agency, the application shall be
    deemed approved.

                   services to nonstockholders or nonmembers

      Sec. 6. No bank service [corporation] company shall
    unreasonably discriminate in the provision of any services
    authorized under this Act to any depository institution that
    does not own stock in or is not a member of the service
    [corporation] company on the basis of the fact that [the
    nonstockholding institution] such depository institution is in
    competition with an institution that owns stock in or is a
    member of the bank service [corporation] company, except that--
              (1) it shall not be considered unreasonable
            discrimination for a bank service [corporation] company
            to provide services to a nonstockholding or nonmember
            institution only at a price that fully reflects all of
            the costs of offering those services, including the
            cost of capital and a reasonable return thereon; and
              (2) a bank service [corporation] company may refuse
            to provide services to a nonstockholding or nonmember
            institution if comparable services are available from
            another source at competitive overall costs, or if the
            providing of services would be beyond the practical
            capacity of the service [corporation] company.

       regulation and examination of bank service [corporation] companies

      Sec. 7. (a) A bank service [corporation] company shall be
    subject to examination and regulation by the appropriate
    Federal banking agency of its principal investor to the same
    extent as its principal investor. The appropriate Federal
    banking agency of the principal shareholder or principal member
    of such a bank service [corporation] company may authorize any
    other Federal banking agency that supervises any other
    shareholder or member of the bank service [corporation] company
    to make such an examination.
      (b) A bank service [corporation] company shall be subject to
    the provisions of section 8 of the Federal Deposit Insurance
    Act (12 U.S.C. 1818) as if the bank service [corporation]
    company were an insured bank. For this purpose, the appropriate
    Federal banking agency shall be the appropriate Federal banking
    agency of the principal investor of the bank service
    [corporation] company.
              * * * * * * *
                          MINORITY VIEWS TO H.R. 1858

        The Democratic and Independent Members of the Committee on
    Banking and Financial Services voted unanimously to oppose the
    Financial Institutions Regulatory Relief Act of 1995. We oppose
    this ill-conceived bill because it poses a danger to the safety
    and soundness of the nation's banking industry, eviscerates
    well proven community development law, and seriously
    compromises many consumer safeguards.
        H.R. 1362 (the precursor of H.R. 1858) as introduced, was a
    grab bag and was overreaching in responding to special
    interests and lobbyists. This bill follows a new trend of
    legislating by anecdote, not fact, as the Committee received no
    documentation of costs supposedly borne by banks because of
    their community or consumer obligations imposed by law. In
    fact, many of the provisions in the bill were rejected in the
    last Congress because they were unjustified, they gutted
    consumer protection laws and they compromised the safe and
    sound operation of our banks. Nonetheless, the bill, H.R. 1362,
    actually was made even worse during the Subcommittee markup by
    Republican amendments. As a result of these amendments,
    important civil rights laws were hobbled; community development
    laws were further eroded; and directors and officers who in the
    past pillaged their institutions would be sheltered in the
    future from liability.
        Because these amendments were so damaging, to the point of
    embarrassing our colleagues, a number were either pared back or
    dropped altogether in the full Committee deliberations. Far
    from ``accommodating'' the concerns of the minority, as
    suggested by the Chairman, these amendments and other
    provisions in the bill were voted down because they are simply
    bad policy. Although the full Committee markup improved the
    bill in several areas, the community reinvestment provisions
    were made dramatically worse--so much so that there remains no
    enforcement mechanism for the gutted CRA law.
        As a result, the bill has justly earned the distinction of
    becoming a veto target. In fact, following the Committee's
    action, Secretary of the Treasury Robert Rubin wrote to inform
    Chairman Leach that he would recommend that the President veto
    the bill in its current form.
        We, Democratic and Independent Members, fully, support
    reasonable efforts to streamline government regulations, but
    cannot support this extreme and radical legislation. As the
    Vento substitute illustrates, it is possible to achieve more
    efficient regulation without putting communities, consumers and
    the deposit insurance funds at risk.
         i. erosion of banks' and thrifts' commitment to serving their
                                  communities

    A. Gutting of CRA

        We are extremely disappointed and alarmed by the
    Committee's action in systematically dismantling the Community
    Reinvestment Act (``CRA''). Because of a series of Republican
    amendments, CRA, a law that has been responsible for the flow
    of more than $30 billion (and by some estimates over $60
    billion) to urban and rural communities across the country has
    been crippled. CRA, a law that simply requires banks and
    thrifts to make credit available to the communities they are
    chartered to serve, has been unjustly demonized by the
    Republicans on the Committee. One of our Republican colleagues
    went so far as to refer to CRA as ``a bunch of crap.'' This
    attitude and the actions of the Republicans demonstrate a
    complete insensitivity to or lack of understanding of the
    inability of low and moderate income Americans to obtain credit
    in our society.
        CRA has been a law that has made credit accessible for
    hundreds of thousands of low- and moderate-income Americans.
    CRA is not a civil rights law nor an affirmative action
    measure, but rather, a law that requires institutions chartered
    and insured by the federal government to lend within all the
    communities they are chartered to serve. And, CRA expressly
    states that serving the credit needs of local communities is to
    be consistent with the safe and sound operations of
    institutions.
        In fact, CRA has not been found to jeopardize the safety
    and soundness of institutions, nor the underlying backstop of
    federal deposit insurance. Federal Reserve Board Governor
    Lawrence Lindsey, in a response to Representative Frank,
    referred to a few of the studies analyzing CRA loan
    performance. Regarding one such study by the Woodstock
    institute in 1993, Governor Lindsey wrote: ``the combined
    delinquency and foreclosure rates for multifamily housing loans
    in low- and moderate-income areas were slightly superior to
    those gleaned from national samples reflecting loans in all
    income area.'' Governor Lindsey also asserted that anecdotal
    information has shown that ``loans to low- and moderate-income
    people perform with respect to repayment as well as, and in
    some cases better than, loans to others. Furthermore, I have
    heard of no cases in which a bank's portfolio contained such a
    large number of such loans that even if a significant number of
    the borrowers defaulted, it would put the bank in a seriously
    adverse safety and soundness position.''
        President Clinton and the banking regulators are to be
    lauded for their two year efforts to reform CRA regulations.
    They have produced regulations which emphasize performance over
    paperwork. Banks and thrifts will be judged by the loans,
    investments, and services they provide to their communities--
    not by the quality of their documentation. Small banks would
    receive streamlined examinations and will have no reporting
    requirements under CRA. Yet, despite being hailed by both the
    banking industry and community groups, these regulations will
    not even have the opportunity to go into effect if this bill
    ever becomes law.
        Because of the Republican actions in Committee,
    institutions with $100 million or less in assets will be exempt
    from CRA coverage altogether. Institutions with $250 million or
    less in assets will be able to ``self certify'' their
    compliance with the law. These two provisions would effectively
    exempt close to 90% percent of banks and thrifts from CRA
    coverage. Furthermore, institutions with CRA ratings of
    satisfactory or above--95% of the industry--will be deemed to
    have satisfied their CRA obligations until their next
    examination. And, the most egregious vote by the Republicans
    was to eliminate the sole enforcement mechanism in CRA--the
    obligation of the regulators to take into account an
    institution's record of meeting its community credit needs when
    considering an institution's application to branch, acquire, or
    merge with another bank or thrift.
        The Republicans have effectively reduced CRA to a hollow
    hope; a shadow of its former self. They have hobbled a law that
    has successfully channeled billions of dollars to urban and
    rural communities. At a time when public funds for such
    communities are getting scarcer, private dollars are essential
    to the economic vitality of these neighborhoods.
        The Republican attack on the Community Reinvestment Act is
    one of the major reasons cited by Secretary Rubin in a letter
    to Chairman Leach advising that he would recommend to the
    President that this regulatory bill be vetoed in its current
    form.

     B. Exemption of over 3,000 institutions from HMDA

        By increasing the statutory exemption from the Home
    Mortgage Disclosure Act (``HMDA'') for institutions with $10
    million in assets or less, to those with $50 million in assets
    or less, section 116 will exempt more than 3,000 additional
    lenders from the law's coverage. Although purported to adjust
    the exemption for inflation, this provision more than doubles
    the actual CPI adjusted dollar figure from 1975. Furthermore,
    it is unclear how many more institutions (with over $50 million
    in assets) will be exempt from HMDA under the new grant of
    discretion to the Federal Reserve Board. The bill permits the
    Board to exempt any other lender from complying with HMDA
    because the law is too burdensome. There is simply no
    justification for granting this exemptive authority to the
    Board which will create a gaping loophole in the law.
        HMDA imposes no more obligation on financial institutions
    than to report their loan data. But this data has proven to be
    critical in revealing discrepancies between lending to
    minorities and non-minority applicants. HMDA has put both
    lenders and the public on notice about the fairness of
    individual institutions' lending practices.
        Disclosures under HMDA are important for purposes of
    monitoring an institution's service to its community and its
    compliance with the fair lending laws. While HMDA data alone is
    not determinative of a fair lending violation, it is an
    essential investigative tool. Because of the utility of HMDA,
    both Secretary Cisneros and Acting Assistant Attorney General
    Kent Markus have written letters to Committee members strongly
    condemning this roll back of HMDA by the Committee.

    C. Restoration of fair lending laws

        We were successful in striking provisions adopted by the
    Subcommittee that seriously undermined our civil rights laws.
    The Subcommittee passed an amendment that would have stripped
    the Attorney General of the authority to initiate cases
    charging a ``pattern or practice'' of discrimination under the
    Fair Housing Act and the Equal Credit Opportunity Act. In a
    letter to Chairman Leach, Attorney General Reno wrote that to
    prohibit the Department of Justice from challenging pattern or
    practice cases would be ``unthinkable.'' Furthermore, the
    amendment would have disallowed the use of disparate impact
    theory in fair lending cases.
        Yet, one of our Republican colleagues exhorted the
    Committee to ``rein in the whole idea of the blackmail
    opportunities that are here today when these suits are being
    brought on disparate impact, and courts of appeals are divided
    on this issue, and let's not go along with this kind of funny
    business anymore . . .''. We are offended that lawsuits to
    vindicate the rights of individuals who have been mistreated by
    financial institutions are equated with ``blackmail'' and
    ``funny business.''
        Moreover, amendments to the Fair Housing Act are well
    outside of the Committee's jurisdiction and expertise. The far
    reaching amendment would have impeded lawsuits beyond the
    lending context and extended to such areas as realtor and
    rental practices, and housing discrimination against families
    with children. All this, without even one hearing on the topic.
        Fortunately, the Committee recognized the potential and
    far-reaching damage that would have been done by these
    provisions and struck them from the bill.
                    ii. a retreat from safety and soundness

        We also oppose this bill because it weakens measures
    designed to ensure the safe and sound operation of federally
    insured institutions. Without critical safeguards, the
    taxpayers stand to lose a lot. The recent savings and loan
    crisis should serve as a grave reminder of the dangers of
    irresponsible deregulation of an industry. We cannot support a
    bill that poses increased risk of loss to the deposit insurance
    funds and the taxpayers who guarantee that fund.

    A. BCCI redux

        The Republican majority on the Committee struck a positive
    amendment to section 223 by Congressman Kanjorski adopted at
    the Subcommittee. The Kanjorski amendment provided important
    safeguards necessary to help prevent another BCCI scandal. The
    provisions would have (1) required that boards of directors be
    comprised of a majority of outside directors; (2) prohibited
    lawyers and accountants who provide professional advice to the
    board of financial institutions over $250 million in size from
    serving on those boards of directors; and (3) required certain
    ownership disclosures to boards of directors. Those provisions
    are crucial to ensuring that a board of directors serve as an
    independent overseer of the financial institution. The
    independence of a board is best insured when a majority of the
    directors are outside directors. Furthermore, prohibiting such
    outside counsel and accountants from serving on the board would
    prevent a clear conflict of interest from arising, as in the
    case of BCCI.

    B. The wrong signal on insider lending

        The amendments to current law contained in section 225
    would effectively encourage the risky and unsafe practice of
    self-serving insider lending. A major cause of the failure of
    banks and thrifts over the past decade was their penchant for
    making exorbitant and risky loans to their own officers and
    directors. This unsafe practice was properly restricted in
    recent years. The Republican majority now seeks to seriously
    weaken those restrictions and the ability of the banking
    regulators to monitor and detect that conduct. This section
    contains major exceptions to the prohibition on insider lending
    and eliminates bank reports on such loans.

    C. The chilling of Government investigations

        Section 227, requiring the government to reimburse a
    financial institution for providing financial records on
    corporate customers pursuant to a government request, would
    have a chilling effect on major investigations and cost the
    taxpayers approximately thirty million dollars in the first
    year alone. In opposing this provision, the Justice Department
    has stated that: ``Financial information about corporations is
    a critical component of some of the Government's most important
    investigations. For example, such information is often
    indispensable in defense procurement fraud and money laundering
    cases. . . . investigators and prosecutors with whom we spoke
    indicated that requiring reimbursement for corporate record
    requests could have chilling impact on investigations,
    particularly in a time of declining government resources.''

    D. Audit committees compromised

        Section 233 of the bill repeals important bank audit
    requirements legislated in response to the egregious abuses of
    the thrift crisis. These requirements sought to ensure that
    insured depository institutions be subject to independent,
    objective and public financial audit procedures in a manner
    consistent with their fiduciary responsibilities and the safety
    and soundness of the banking system.
        The bill would eviscerate nearly all of these requirements
    for well over 90% of the nation's banking institutions. For
    example, it repeals the requirement that the banks' boards of
    directors establish audit committees composed entirely of
    independent, outside directors. Thus, all but fewer than 10% of
    U.S. banks would be able to either abolish their audit
    committee altogether or appoint all insiders to the audit
    committee. Service of insiders on the audit committee presents
    a clear conflict of interest since those who manage the
    institution can hardly be expected to objectively audit or
    criticize its operations. Such an exception from the audit
    committee requirement, for instutitions which enjoy the
    benefits of federal deposit insurance, is a standard far below
    that for nearly all privately-owned, publicly-traded American
    corporations. And to make matters worse, this exception is
    absolute--banking regulators are given no discretion to require
    that even one member of the audit committee be an independent,
    outside director.
        The bill also eliminates statutory requirements that a
    bank's independent accountants attest to the bank's compliance
    with safety and soundness laws. It also repeals the requirement
    that accountants report on, and attest to, the effectiveness of
    a bank's internal control polices and procedures, which are key
    to the institution's risk management and financial soundness.
    These attestation requirements are critical in maintaining the
    accountants' objectivity and providing essential information
    about the bank's condition. The bill would also permit banking
    regulators to designate certain aspects of the bank's audited
    financial reports as confidential and unavailable to the
    public. This patently undermines the fundamental principle of
    public accountability for federally insured banks and opens the
    door to concealment of basic financial information that all
    investors, depositors and taxpayers have the right to know.
    E. Outside directors--Hear no evil, see no evil

        Section 234 would exclude outside directors from the
    definition of ``institution affiliated party'' for purposes of
    various enforcement actions. They should thus be subject to an
    enforcement action only if an agency could prove that the
    outside director ``knowingly'' or ``recklessly'' participated
    in a violation of law or regulation. Currently, outside
    directors are subject to the same negligence standard as
    applies to other directors.
        This amendment would harm corporate governance and create
    perverse incentives for outside directors to avoid learning
    about, or following up on, facts that could give raise to
    liability. As the Federal Deposit Insurance Corporation has
    stated in correspondence on the provision: ``All directors of
    insured depository institutions, regardless of whether they are
    inside or outside directors, have a duty to set policies for
    their institutions and see that those policies are implemented
    and adhered to while meeting its community's needs on a safe
    and sound basis. Losses an insured depository institution can
    sustain as a result of negligent oversight are not determined
    by whether the negligent director is an insider or an outsider.
    The experience of the FDIC has shown that both inside and
    outside directors can engage in negligent conduct as well as
    abusive self-dealing transactions. We believe good corporate
    governance and effective regulatory oversight require that all
    directors know that they will be held responsible for
    fulfilling their duties to properly manage their institution.
    Put differently, telling outside directors that they can be
    negligent with impunity is definitely the wrong message.''
        These are only the most egregious examples of how this
    legislation would in many ways place our nation's insured
    depository institutions on unsafe and unsound footing, and
    thereby increase the risk that the taxpayers will once again be
    asked to pay for the excesses of an unregulated financial
    institutions industries. Fortunately, a very dangerous and
    costly section of the bill added by the Republicans at the
    Subcommittee was deleted at the full Committee by other
    Republicans who painfully recognized the harm it would cause.
    The provision would have established new rules governing the
    legal liability and standard of conduct for directors and
    officers of insured depository institutions. Those directors
    and officers of insured depository institutions. Those rules
    were roundly opposed by the banking regulators as irresponsibly
    absolving directors and officers of any real duty to safely and
    soundly oversee an insured depository institution.

                       III. The consumer is the Big Loser

    A. The Home Ownership and Equity Protection Act is substantially
            weakened

        The bill effectively eliminates the important consumer
    protection of the Home Ownership and Equity Protection Act
    passed just last year, by limiting the Act's coverage to second
    mortgages. The Home Ownership and Equity Protection Act, which
    has not even been implemented, requires additional disclosures
    in the case of mortgages with interest rates more than 10
    points above comparable Treasury securities or mortgages with
    fees that are more than the greater of 8 points or $400. The
    Act also prohibits certain particularly abusive terms in
    connection with these high cost mortgages, such as negative
    amortization, prepayment penalties and balloon payments within
    5 years.
        The law was enacted with bipartisan support and addresses
    unscrupulous lending practices. Congressional hearings
    documented abusive tactics employed by certain lenders whereby
    these lenders would target poor people with equity in their
    homes, oftentimes with credit problems, for home equity loans.
    The loans would be made for purposes of debt consolidation or
    home improvements, improvements which the homeowners were often
    convinced to undertake by the lender. Testimony from numerous
    sources, including the National Housing Law Project and AARP,
    indicated that, in the vast majority of cases lenders target
    homeowners who either own their homes outright or have very
    small payments remaining on their mortgages. Where mortgages do
    remain, the new lender pays off any existing balance in order
    to obtain the first lien. This is done both to ensure that the
    new lender gets the priority lien and because federal law
    prohibits interest rate regulation on first mortgages thus
    allowing the high rates to be charged.
        Multiple fees are usually folded into the loan amounts,
    often without the knowledge of the borrower. In many cases,
    because of these fees, the proceeds to the homeowner amount to
    as little as one third of the loan amount. As a result,
    homeowners with fixed incomes are saddled with monthly payments
    they cannot afford, and inevitably their homes are subject to
    foreclosure.
        The Home Ownership and Equity Protection Act does not
    affect a single legitimate lender, as indicated by industry
    testimony during the last Congress in support of the
    legislation. This year, in testimony before the Subcommittee,
    Federal Reserve Board Governor Susan Phillips stated, ``It is
    not immediately apparent why this revision is being proposed,
    however, given the clear anecdotal and other evidence presented
    to Congress at the time the law was enacted--which showed that
    the abuses and problems associated with high-cost loans
    occurred primarily in connection with first-lien
    refinancings.''
        We join the Federal Reserve Board in questioning the reason
    for gutting this Act. It appears to us to be no more than
    pandering to special interests at the expense of unsuspecting
    consumers.

    B. Truth in Savings Act protections are diminished
        The bill repeals important provisions of the Truth in
    Savings Act (``TISA''), which protect bank customers from
    misleading, deceptive or incomplete disclosures and advertising
    relating to their federally insured deposits. As introduced,
    H.R. 1362 would have repealed nearly the entire Act, which
    became effective only in 1993, but improvements were made
    during the Subcommittee and full Committee markups. Because of
    a Democrat-initiated amendment, significant consumer
    protections concerning mandatory disclosure of the rates, fees
    and terms of deposit accounts and any change in those items,
    was restored. Under the bill, however, TISA's requirement that
    banks use a uniform method of calculating and disclosing
    account yields--the annual percentage yield--would be repealed.
    Without such uniform disclosures, consumers cannot make
    informed comparisons about banks and bank products.
        Additionally, the bull strips TISA of its civil liability
    provisions. Therefore, if a consumer is misled about the terms
    of an account, or even if the bank fails to give the consumer
    the proper interest rate, the consumer is left without recourse
    against the bank under the Act. Only administrative remedies
    remain. Administrative remedies alone are insufficient to
    enforce the Act's provisions and vindicate an individual
    customer's rights.

    C. Consumer privacy breached by information sharing among affiliates

        We strongly disagree with the manner in which the bill
    permits affiliates and subsidiaries of depository institutions
    to share confidential and sensitive financial information on
    their customers. Section 142 completely overrides the statutory
    protections of the Fair Credit Reporting Act (``FCRA'') without
    putting in place any mechanism whereby consumers can ensure the
    accuracy of the information that is being shared among
    affiliated companies.
        Should H.R. 1062, the Financial Services Modernization Act,
    be enacted, the scope of this provision will be far reaching.
    Depository institutions will be permitted to freely share
    sensitive customer information with their affiliated securities
    firms, and in some instances, commercial entities and insurance
    companies. Under section 142, depository institutions could
    establish affiliated credit bureaus with files on millions of
    customers to service these companies free of any regulation.
        While permitting affiliated companies to share credit
    information on their customers may be a desired goal, it should
    be accomplished in the context of reforming the FCRA. This was
    the approach taken by the Committee in the last Congress. Last
    year, the Committee, and the full House voted to allow such
    sharing of information among affiliated companies, without
    limiting it to depository institutions and their affiliates. In
    so doing, the Committee also passed important consumer
    safeguards and strengthened the FCRA. It is time for the
    Committee to once again demonstrate its resolve to aid
    consumers by considering and passing much needed reforms to the
    FCRA.

    D. The bill cedes too much authority to the Federal Reserve Board to
            reduce TILA's coverage

        Section 103 of the bill provides the Federal Reserve Board
    with broad authority to run literally roughshod over the Truth
    in Lending Act (``TILA''). This section automatically excludes
    from the law's coverage any transaction that the Board
    determines by regulation is not needed to carry out the
    purposes of the Act. The bill further directs the Board to
    exclude from TILA's coverage any class of transaction that the
    Board determines does not provide a ``measurable benefit to
    consumers''. Far from providing the Board with appropriate
    regulatory flexibility to interpret the Act, this section
    amounts to an extraordinary grant of legislative authority to a
    regulator which could serve to undermine the purposes of the
    Act.

    E. RESPA is balkanized

        Amendments made at the Subcommittee and full Committee have
    mangled the enforcement of the Real Estate Settlement
    Procedures Act (RESPA). These proposed changes could render
    this law, which was designed to protect consumers during
    settlement procedures for a home purchase, useless as a result
    of the regulatory confusion. The Republican bill will transfer
    responsibility for all of RESPA from the Department of Housing
    and Urban Development (HUD) to the Federal Reserve except for
    Sections 8, 9 and 12. The enforcement aspects of these sections
    will be balkanized because enforcement will be divided among
    the financial institutions' regulators and HUD.
        The amendments to RESPA would also mandate HUD to use
    negotiated rulemaking--even on the somewhat contentious rules
    that are soon to be completed by the Department after over two
    years of work by this Administration's HUD alone. Requiring HUD
    to conduct negotiated rulemaking, particularly where affected
    industries will never agree, will prolong the rulemaking
    process indefinitely and will only further delay the resolution
    of issues such as Computerized Loan Originations (CLOs) and
    Controlled Business Arrangements (CBAs).
        Finally, despite being labeled as mere changes to the
    ``purposes'' section of RESPA, the amendments will make
    substantive revisions to RESPA by directing HUD how to
    specifically regulate settlement services prices or
    compensation agreements. Numerous Congressional hearings have
    highlighted egregious practices utilized by some in the
    mortgage settlement industries. Significant changes were made
    in this bill to RESPA, without consideration of the
    ramifications for consumers.
    IV. Bank Insurance Powers--Why Are We Rolling Back Insurance Powers in
                              a Deregulation Bill?

        A number of us are troubled by the inclusion of a provision
    in a regulatory relief bill that addresses bank insurance
    powers. We recognize that the approach adopted by the
    Republicans was an attempt to balance the competing demands of
    the banking and insurance industries and was done so at the
    direction of the Republican leadership. However, this is an
    issue most appropriately addressed in legislation amending the
    Glass Steagall Act. We must admonish our Republican colleagues
    that any attempts to join this regulatory relief bill with the
    Financial Services Modernization Act of 1995, H.R. 1062, will
    severely erode any possible bipartisan support that H.R. 1062
    might enjoy and will diminish prospects for its v passage.

          V. We Stand for Responsible Regulatory and Statutory Reform

        Responding to the need for real regulatory relief, the
    Committee Democrats crafted a comprehensive substitute bill
    with provisions that would reduce regulatory burden without
    sacrificing communities, consumers, or the taxpayer.
        The Vento substitute would modernize and streamline
    numerous banking laws and regulations. This regulatory burden
    relief proposal will provide for a simplified and improved Real
    Estate Settlement Practices Act (``RESPA'') and Truth in
    Lending Act (``TILA''). It also simplifies the TILA disclosures
    for Adjustable Rate Mortages (``ARMs''). Other provisions
    clarify confusing disclosures to applicants relating to
    assignment, sale, or transfer of loan services under RESPA.
        The Democratic proposal streamlines the Truth in Savings
    Act (``TISA'') without compromising its effectiveness. The
    Vento substitute modifies the civil liability provision to
    exclude its application to advertisements, and would further
    require the Federal Reserve Board (FRB) to determine and report
    to Congress within six months which accounts (if any) are not
    appropriately served by the calculation of interest under the
    Annual Percentage Yield (APY) formula.
        The Vento substitute allows for a realistic adjustment of
    the Home Mortgage Disclosure Act (HMDA) exception from
    reporting for institutions with assets of $10 million or less
    every five years based on CPI for inflation starting from the
    beginning of calendar year 1990. It also encourages self-
    testing by creditors by protecting the results of such self-
    testing unless it was conducted at an agency's request, the
    creditor used the results to defend themselves, or the agency
    received evidence of discrimination independently of the self-
    testing.
        The substitute includes the comprehensive bipartisan
    provisions providing relief from the ``Rodash'' case that
    destabilize the mortgage banking system, including the
    secondary market for mortgages. Major provisions of the
    proposal include the exclusion of certain third party fees
    imposed by closing agents and intangible taxes from the finance
    charge; the elimination of the right of rescission for
    mortgages that are refinanced with a certain lenders only where
    those loans contain no new cash advances and consolidation of
    other existing debt; the provision for a higher tolerance for
    errors in the calculation of the finance charge equal to \1/16\
    of 1% of the APR, but in no event less than $25 or more than
    $200; the raising of statutory damages for loans secured by
    homes from $100 to $1,000, to $250 to $2,500; and, the
    provision of retroactive relief for lenders against individual
    claims filed after June 1, 1995 and for class actions certified
    after January 1, 1995 that relate to misdisclosure of third
    party fees, errors exceeding the tolerance in section 108, or
    the use of improper rescission forms.
        The substitute streamlines the Bank Holding Company Act by
    permitting well-capitalized and well-managed BHCs whose banks
    all have received ``satisfactory'' CRA ratings to acquire
    certain other banks without prior approval of the Federal
    Reserve Board, but rather, through a public notice of 30 days.
    It further would permit these BHCs to engage in any nonbanking
    activity (closely related to banking) simply by noticing the
    Board. The bill further streamlines the bank application
    process for branches of banks that are well-capitalized, rated
    a CAMEL 1 and 2, have at least a ``satisfactory'' CRA rating,
    and seek to operate in an area that satisfies all applicable
    geographic limitations with appropriate public notice and
    comment.
        Other streamlining measures would direct the Office of
    Thrift Supervision (OTS) and the Federal Reserve Board to
    coordinate and establish a unified examination procedure for
    dual holding companies and streamline regulatory oversight of
    such companies by requiring the agencies to coordinate and
    unify regulatory requirements imposed on dual holding companies
    consistent.
        Importantly, the Vento substitute expands regulatory
    discretion for examinations from institutions with up to $175
    million to institutions with up to $250 million. It also
    eliminates branch application requirements for automated teller
    machines (ATMs) and remote service units while it removes the
    out-dated per-branch capital standard in 12 U.S.C. Section
    36(h).
        Also included are reductions in overlap in foreign bank
    applications and requirements that the Federal Reserve Board
    should rely on examinations of other Federal and State
    regulators for the examination of foreign banks to the maximum
    extent practicable. The substitute would amend provisions of
    the Depository Institutions Management Interlocks Act (DIMIA)
    to prohibit an outside attorney or accountant of a depository
    institution from serving as a director of the institution with
    limited exceptions, while also requiring that a majority of
    each board be made up of outside directors.
        As part of comprehensive, on-going regulatory review the
    substitute requires the Federal Financial Institutions
    Examination Council (FFIEC) and each respective federal banking
    agency represented on the FFIEC, and the National Credit Union
    Administration (NCUA) Board to identify outdated or otherwise
    unnecessary regulatory requirements on financial institutions,
    and eliminate them as appropriate within every 10 year period.
        The Vento substitute also includes the bipartisan
    provisions limiting lender liability for environmental clean-up
    by clarifying the liability under Federal environmental law for
    lenders, fiduciaries, and Federal banking and lending agencies
    and providing certainty as to when and to what extent these
    parties may have liability for violations under Federal
    environmental law for their lending, financial and fiduciary
    activities.
        These provisions show that Democratic and Independent
    Members of the Banking Committee have been listening and do
    what to respond to the call for true regulatory relief in an
    bipartisan manner whenever possible. However, this relief
    should not and does not have to come at the expense of the
    American consumers, its communities or the taxpayers.
    Proponents of many of the provisions of the Committee reported
    regulatory repeal bill have not yet demonstrated that laws such
    as the Truth in Savings Act or the Community Reinvestment Act,
    significantly add to the costs of or are detrimental to
    financial institutions--especially in light of record bank
    profits.
        For the reasons generally outlined in these views, we will
    continue to oppose the provisions of H.R. 1858. We will
    actively seek, however, to further improve this bill or
    ultimately work for its timely demise.
                                       Henry Gonzales.
                                       Floyd H. Flake.
                                       John J. LaFalce.
                                       Cleo Fields.
                                       Tom Barrett.
                                       Kweisi Mfume.
                                       Joe Kennedy.
                                       Maurice Hinchey.
                                       Nydia Velazquez.
                                       Lucille Roybal-Allard.
                                       Albert R. Wynn.
                                       Bruce F. Vento.
                                       Gary L. Ackerman.
                                       Carolyn B. Maloney.
                                       Luis V. Gutierrez.
                                       Maxine Waters.
                                       Paul E. Kanjorski.
                                       Charles Schumer.
                                       Melvin L. Watt.
                                       Bernie Sanders.
                         ADDITIONAL VIEWS OF MR. FLAKE

        As author of this amendment, I am offering my separate
    views to be included in the final report in order to clarify
    any interpretations of my empowerment zone amendment. It is my
    intention for it to operate independently of section 5136A, and
    the provisions of section 5136A shall not apply to the powers
    of National Banks as so conferred under section 5136B.
        This new section will provide greater access to insurance
    in disadvantaged communities where competively priced insurance
    is inadequate. Moreover, this amendment will foster economic
    revitalization, such a new business and employment
    opportunities, in low income neighborhoods by permitting the
    sale of insurance in empowerment zones. Additionally, by
    requiring the sale of insurance to occur from a ``full-service
    branch'' in the empowerment zone, the amendment provides a
    significant incentive for banks to improve the quality and
    quantity of banking services in such communities.
        Effective immediately, this amendment allows national banks
    having main offices or full-service branches in areas eligible
    for designation as empowerment zones or enterprise communities
    under section 1392 of the Internal Revenue Code of 1986, or in
    Indian reservations, to sell insurance from that location. The
    designation criteria for an empowerment zone or enterprise
    community assures that the community is one experiencing
    economic distress.
        State laws that regulate conducting the business of
    insurance, including those that provide operational
    restrictions protecting consumers, would apply to national
    banks sale of insurance under this section. However, State laws
    would not apply if the appropriate Federal banking agency
    determined, after notice to and comment by the appropriate
    State officials, that application of a specific State law would
    have an unreasonably discriminatory effect upon the sale of
    insurance by banks or their employees in comparison with the
    effect the application of such state law would have on the sale
    of insurance by other entities. This provision will ensure that
    banks selling insurance in a State are subject to the same
    operational and customer protection standards that apply to
    other entities selling insurance in the State.
                                                        Floyd H. Flake.
                         ADDITIONAL VIEWS OF MS. WATERS

        This legislation contains many objectionable provisions.
    However, during consideration of the bill in committee, perhaps
    the most objectionable discussion of the deliberations centered
    around the bill's proposed changes to the legal standards
    applied to the Fair Housing Act and Equal Credit Opportunity
    Act.
        Combined with the severe weakening of the Community
    Reinvestment Act, including changes in its enforceability, and
    the rollback of several consumer laws, I felt personally
    offended by the changes which were proposed in the committee
    print.
        The attempt to eliminate disparate impact as a standard for
    review of discrimination claims brought under the Fair Housing
    Act and the Equal Credit Opportunity Act--changes which were
    contained in the committee print of the bill--represented a
    frontal attack on civil rights law--civil rights laws that
    people have fought and died for.
        Disparate impact is one of three long-standing legal
    standards (intentional discrimination and disparate treatment
    are the others) used to challenge discrimination. Disparate
    impact is used to challenge practices that are neutral in
    design but when applied has a disproportionate and
    substantially discriminatory effect on people because of their
    race, color, religion, sex, familial status, national origin,
    or handicap. Under this analysis, practices and policies which
    have a discriminatory effect must be eliminated or changed
    where they have no business necessity.
        This attack on our civil rights laws did not belong in this
    bill. It did not belong in the Banking Committee. I do not know
    who was behind it. I do not know whether it was an organized
    effort on the part of a special interest. I do not know if it
    was one person's bias. But whatever the source, I, and others
    on the Banking Committee, were seriously disrespected by the
    kinds of representations of civil rights laws that were made
    during the committee deliberations.
        Fortunately, the committee had the good sense to strike the
    most egregious part of the underlying bill which would have
    exempted an entire class of fair lending and fair housing
    violations from enforcement. Those disparate impact provisions
    would have created a loophole for a single industry from the
    standards Congress and the Federal Courts have determined are
    necessary to prohibit discrimination.
        Despite the removal of these provisions from the bill, I
    remain troubled that the committee was forced to spend many
    hours debating an attempt to deny me my rights, my children
    their rights, and which would have dramatically affected the
    future of me and my people. I truly hope that as this bill
    moves forward, we will not see any recurrence of this effort to
    undermine longstanding civil rights laws and practices.
                                                         Maxine Waters.
                ADDITIONAL VIEWS OF CONGRESSMAN MAURICE HINCHEY

                 incentives for self-testing for discrimination

        As the author of the section 155 provisions providing
    incentives for institutions to test themselves for lending or
    housing discrimination, I would like to explain the intent of
    this section. My substitute language for the original self-
    testing provisions of the bill was adopted on a voice vote by
    the Committee, and it reflects a fair and balanced approach to
    this issue. It is supported by both the Justice Department and
    Department of Housing and Urban Development, two of the primary
    enforcement agencies for our fair lending and housing laws.
        In order to provide incentives for institutions to self-
    test for and correct violations of the Fair Housing Act or
    Equal Credit Opportunity Act, Section 155 prevents evidence of
    discrimination gathered through a self-test from being used
    against an institution if the institution is taking appropriate
    corrective actions for any discrimination that is found.
        Testing, as defined by the Supreme Court, refers to the
    method of using ``individuals who, without the intent to rent
    or purchase . . . pose as renters or purchasers for the purpose
    of collecting evidence of unlawful . . . practices.'' Havens
    Realty Corp v. Coleman, 455 U.S. 363, 373 (1982) (defining
    testers in the context of fair housing investigations). In the
    fair housing and employment context, testing has traditionally
    been ``paired testing''--a process that examines disparate
    treatment of two individuals that are matched in every respect
    except for the protected category (e.g. race, gender
    disability, etc.). Paired testing is a valuable method of
    obtaining evidence of disparate treatment and I strongly
    encourage its use by lending institutions to find and correct
    discriminatory practices.
        Although paired testing is the most widely accepted form of
    testing, I recognize that other testing methods may produce
    similar and reliable new evidence of unlawful practices and
    therefore warrant protection under the law. I intended for
    Federal regulations to address the scope of what additional
    practices should be accommodated within the definition of the
    term ``self-test.''
        The principal attribute of self-testing is that it produces
    new evidence of discrimination against fictitious applicants.
    Self-testing should be distinguished from compliance reviews,
    file analysis, the use of second review committees, or other
    methods that examine existing evidence of discrimination
    against real applicants. I did not intend for Section 155 to
    provide protection to apply to such activities.
        It is my intent to limit evidentiary protection to those
    institutions that correct discrimination found through self-
    testing. Section 155 is not intended to create an evidentiary
    shield for institutions that find violations of fair lending or
    housing laws and fail to take appropriate steps to correct such
    discrimination.
        An institution that discovers discrimination should make
    all reasonable efforts to determine the extent of the
    discrimination and its cause including, for example, whether
    the discrimination is grounded in the institution's policies,
    the implementation of its policies, employee misconduct, or
    some other factor. Appropriate action to rectify the cause and
    effect of discrimination should be taken commensurate with the
    scope of discrimination. On April 15, 1994, the Interagency
    Fair Lending Task Force addressed several specific components
    of ``appropriate corrective actions to address the
    discrimination'' found through self-testing. ``Policy Statement
    on Discrimination in Lending.'' 59 Fed. Reg. 18266, 18270-71
    (``Joint Statement'').\1\ I agree with this analysis and intend
    that ``appropriate corrective actions'' under Section 155 be
    construed in line with the Joint Statement's guidelines.
        \1\ The Task Force is composed of the top officials from each of
    the ten agencies with responsibilities for fair lending enforcement--
    the Department of Housing and Urban Development, Office of Federal
    Enterprise Oversight, Department of Justice, Office of the Comptroller
    of the Currency, Office of Thrift Supervision, Board of Governors of
    the Federal Reserve System, Federal Deposit Insurance Corporation,
    Federal Housing Finance Board, Federal Trade Commission, and the
    National Credit Union Administration.
    ---------------------------------------------------------------------------

                             credit scoring systems

        Section 156 amends the Equal Credit Opportunity Act to
    clarify that credit decisions based solely on an empirically
    derived, demonstrably and statistically sound credit scoring
    system, as defined by the Federal Reserve Board in regulations
    prescribed under this title (12 C.F.R. Pt. 202,``Regulation
    B''), shall be in compliance with the non-discrimination
    requirement under ECOA (subsection (a)) as long as the system
    does not use any category protected under subsection (a), does
    not use the functional equivalent of such a category, and does
    not use any criterion that has a discriminatory effect on any
    such a category unless the use of the criterion is justified by
    business necessity and there in no less discriminatory
    alternative available. This provision is consistent with the
    Federal Reserve Board's current interpretation concerning the
    use of credit scoring systems for credit decisions.
        Credit scoring systems treat all applicants objectively and
    therefore generally avoid the risk of disparage treatment.
    There may be instances, however, when individual discretion may
    be used in conjunction with the use of a credit scoring system
    and therefore lend opportunity for the disparate treatment of
    applicants. I firmly believe that it was not the intent of the
    Committee to shield such treatment from analysis under ECOA.
    Only those decision made solely based on a credit scoring
    system should be deemed to be in compliance with ECOA under
    this section.
        The Committee accepted, by a vote of 29 to 17, my amendment
    that clarifies that credit scoring systems are not immune to a
    discriminatory effect analysis. As the Federal Reserve Board
    has recognized, the ECOA may prohibit a practice that, although
    neutral on its face and not intended to discriminate, has a
    disproportionately negative effect on a prohibited basis if the
    practice is not justified by business necessity with no less
    discriminatory alternative available. See Appendix D to Part
    202, Section 202.6, 12 C.F.R. Sec 202, Supp. 1 (1995).

                                disparate impact

        By a vote of 32 to 15, the Committee approved my amendment
    to strike provisions added at Subcommittee that would have
    limited the use of disparate impact theory in fair housing and
    lending cases. In doing so, the Committee, on an overwhelming
    and bipartisan basis, has spoken strongly about preserving a
    fundamental civil rights protection against policies that have
    discriminatory effects on applicants, whether or not intent can
    be proven.

                                                       Maurice Hinchey.
            ADDITIONAL VIEWS OF CONGRESSMAN KENNETH E. BENTSEN, JR.

        House Resolution 1858 is a flawed bill. While it could have
    been a good piece of legislation providing needed regulatory
    relief, protecting consumer interests, and continuing our
    commitment to community reinvestment, the final bill failed to
    do so, For that reason, I could not support the legislation.
        I believe the Committee failed to find the appropriate
    balance between regulatory relief and consumer needs with
    respect to disclosure and reinvestment. While I support
    addressing ``Rodash,'' RESPA, lender liability under Superfund,
    as well as streamlining the financial regulatory process, this
    bill strayed from its original purpose by going too far in
    removing consumer safeguards and curtailing the Community
    Reinvestment Act of 1977 (``CRA'').
        I agree with the concept of ``self-compliance'' and ``safe
    harbor'' for CRA. Banks that make a good faith effort to invest
    in the communities from which they receive deposits and reach
    out to traditionally underserved areas deserve to be rewarded.
    However, the Committee's approach does not necessarily reward
    such behavior, but rather it rewards all behavior.
        I attempted to amend Sections 123 and 125 which would have
    raised the rating threshold for self-compliance and safe harbor
    from ``satisfactory'' to ``high satisfactory.'' The Committee
    provision for the lower threshold of a ``satisfactory'' rating
    exempted far too many institutions and would reward them for
    less than satisfactory behavior in some categories. This
    concept of ``high satisfactory'' was originally suggested by
    members of the Board of Governors of the Federal Reserve and
    discussed in the May 5, 1995 publication of the new rules
    relating to CRA. A new category would have ensured that banks
    that truly excel at meeting CRA--and there are many, including
    many in my hometown of Houston--would be rewarded based upon
    good performance in all categories of at least
    ``satisfactory.'' Unfortunately, the Committee chose to reward
    ninety-five percent of all banks even if they receive a low
    satisfactory rating on lending and even lower ratings on
    service and investment. I could not support that, and I believe
    the Administration will also find it hard to support.
        The Committee also chose to change the Truth in Lending Act
    by limiting disclosure relating to adjustable rate mortgage
    loans. Under the Committee's bill, a lender would only have to
    tell a borrower that adjustable rates fluctuate, rather than
    provide historical data on adjustable rate mortgages. During
    the last ten years, such rates have fluctuated within a band of
    600 basis points and within the last three years a band of 300
    basis point. That is considerable volatility to be described
    only in rhetorical terms.
        Every day, sophisticated investors and institutions
    purchase adjustable rate mortgage instruments in the primary
    and secondary markets relying in part on substantial historical
    data. Yet the Committee believes that individual homebuyers who
    may not trade in the mortgage market do not need even the
    simplest and most readily available historical data in order to
    understand the interest rate risk associated with such floating
    rate instruments. I completely disagree with that proposition,
    and I believe this Committee revisit this issue upon learning
    of the number of consumers who end up with products they did
    not understand due to a lack of proper disclosure. If its is
    good for institutional investors, it should be good for
    individual borrowers.
        This bill had the opportunity to be good legislation, but
    it failed. We made strides toward addressing the banking and
    insurance question, albeit in a symbiotic way. The Committee
    came close to engaging in a full-fledged discussion of the
    proper role for banks in the insurance market. Yet, on the one
    hand, while we gave banks in certain states more insurance
    powers, with the other hand we took most of those powers away.
    After studying this issue over the last six months, I have
    become convinced that we should consider affiliation. We should
    try to determine whether affiliation will increase benefits to
    purchasers of insurance while protecting the professional
    criteria of insurance brokerage. Consumer protection and
    professionalism should not be viewed as mutually exclusive in
    this instance. insurance agents and brokers bring knowledge of
    both product and rules to the market which benefit the
    consumer. Finally, as presented to the Committee, the
    moratorium on the Comptroller of the Currency is unevenly
    drafted, since it curtails institutions, not powers, thus
    exacerbating not only the insurance power question, but also
    creating an uneven playing field among banks.
        I support finding ways to eliminate unnecessary and
    redundant regulations for banks. I have supported legislative
    efforts to rewrite Glass-Steagall which will make banks more
    competitive and ensure that consumers can buy new products to
    meet their financial needs. I believe we must maintain a
    balance between protecting the consumer and giving banks needed
    flexibility to adapt to the marketplace. Regulations need to be
    reasonable and fair-minded. Congress should regularly exercise
    its prerogative to review regulations and make appropriate
    change to reflect the changing marketplace.
        In fact, I would argue that the financial marketplace is
    changing faster every day. Through court decisions and state
    actions, federal regulations are falling behind the
    marketplace. The financial market is producing new financial
    products that benefit both consumers and the banks that supply
    them.
        We addressed issues which needed relief, but the Committee
    went beyond reasonableness and reported a bill which rolls back
    too much. For that reason, I could not support the bill in its
    current form.
                                                Kenneth E. Bentsen, Jr.
                                A P P E N D I X

                                  ----------

                                         Committee on Commerce,
                                         Washington, DC, July 17, 1995.
    Hon. James A. Leach,
    Chairman, Committee on Banking and Financial Services, Rayburn House
            Office Building, Washington, DC.
        Dear Chairman Leach: On June 29, 1995, the Committee on
    Banking and Financial Services ordered reported H.R. 1858, the
    Financial Institutions Regulatory Relief Act of 1995.
        A number of provisions of H.R. 1858 as approved by the
    Banking Committee fall within the jurisdiction of the Commerce
    Committee. These include, but are not limited to, provisions
    amending the Government Securities Act, provisions pertaining
    to a lender's liability for environmental hazards, provisions
    affecting the regulation and sale of insurance and affiliation
    among different service providers, and provisions that may
    apply to registrants' obligations to provide certain
    information pursuant to the Securities and Exchange Act of
    1934.
        I have appreciated your willingness to address my concerns
    with many of the provisions of H.R. 1858 that fall within the
    jurisdiction of the Commerce Committee. In view of your desire
    to move this legislation to the Floor in an expeditious
    fashion, I do not intend to seek a sequential referral of H.R.
    1858. I would appreciate, however, your commitment that the
    agreements worked out between our staffs will be effected
    without the need for separate amendments by the Commerce
    Committee on the House Floor.
        Please be advised that my agreement not to seek a
    sequential referral is based on an understanding that this
    waiver will be without prejudice to the Commerce Committee's
    jurisdictional claims over H.R. 1858 and similar bills that may
    be offered in the future and that the Commerce Committee's
    jurisdiction will be protected through the appointment of
    conferees should H.R. 1858 go to conference.
        I appreciate your cooperation in these matters and would
    further appreciate the inclusion of this letter in the Banking
    Committee's report on H.R. 1858.
                Sincerely,
                                       Thomas J. Bliley, Jr., Chairman.
                                    ------

                   Committee on Banking and Financial Services,
                                         Washington, DC, July 17, 1995.
    Hon. Thomas J. Bliley, Jr.,
    Chairman, House Commerce Committee,
    Washington, DC.
        Dear Mr. Chairman: Thank you for your letter of July 17,
    1995, regarding a bill reported by the Committee on Banking and
    Financial Services, H.R. 1858, Financial Institutions
    Regulatory Relief Act of 1995.
        I appreciate the interest that the Committee on Commerce
    has in this important legislation. As your letter indicates,
    the Committee could be successful in asserting a right to a
    sequential referral of H.R. 1858. Therefore, I am most
    appreciative of your decision not to request such a referral in
    the interest of accommodating consideration of the bill.
        You have my assurance that the agreements worked out by our
    respective staffs concerning changes to Title III will be
    included in a manager's amendment as we take the bill to the
    House floor. You also have my commitment to work together to
    achieve a mutually satisfactory resolution of the insurance and
    securities issues within the jurisdiction of the Commerce
    Committee. In addition, I will also support your Committee's
    request to seek conferees on these matters within the
    jurisdiction of the Commerce Committee.
        Thank you for your cooperation in this matter and for your
    support of this legislation.
                Sincerely,
                                              James A. Leach, Chairman.
                                    ------

                Committee on Transportation and Infrastructure,
                                         Washington, DC, July 12, 1995.
    Hon. James A. Leach,
    Chairman, Committee on Banking and Financial Services, Rayburn House
            Office Building, Washington, DC.
        Dear Mr. Chairman: Thank you for the information that on
    June 29, 1995, the Committee on Banking and Financial Services
    ordered reported, H.R. 1858, the Financial Institutions
    Regulatory Relief Act of 1995. I believe that the Committee on
    Transportation and Infrastructure clearly has a right to
    sequential referral of Title III of this bill, relating to
    liability of lenders and others under various Federal
    environmental laws.
        Title III includes detailed criteria and requirements for
    liability of lenders, fiduciaries, and Federal agencies under
    Federal environmental law. The bill expansively defines Federal
    environmental law to include specific statutes, Federal
    implementing regulations, and state-delegated laws and
    regulations. H.R. 1858 also explicitly addresses liability
    under the Comprehensive Environmental Response, Compensation
    and Liability Act (``Superfund''), the Oil Pollution Act, and
    the Clean Water Act.
        As you know, the Transportation and Infrastructure
    Committee has jurisdiction over Superfund, the Oil Production
    Act and the Clean Water Act. Lender liability under Superfund
    is of particular interest and concern to the Committee. We are
    currently working on a comprehensive bill to reauthorize and
    reform Superfund--the law that has generated much of the debate
    over lender liability. This year, we held six hearings on
    Superfund; much of the testimony focused on lender liability
    and specifically on the provisions in H.R. 3800, Superfund
    legislation reported by this Committee last year.
        In the interest of accommodating the schedule for
    consideration of H.R. 1858, I do not intend to request a
    sequential referral of the bill to the Committee. However, I
    would appreciate receiving assurances that the agreements
    worked out between our respective staffs will be effected to
    our satisfaction without the need for a Floor amendment by this
    Committee. Meanwhile, my action here is not intended to waive
    the Committee's jurisdiction over this matter, and should this
    legislation go to a House-Senate Conference, the Committee on
    Transportation and Infrastructure will request to be included
    as conferees on any provisions within this Committee's
    jurisdiction.
        With kind personal regards, I remain
                Sincerely,
                                                 Bud Shuster, Chairman.
                                    ------

                   Committee on Banking and Financial Services,
                                         Washington, DC, July 17, 1995.
    Hon. Bud Shuster,
    Chairman, Committee on Transportation and Infrastructure,
    Washington, DC.
        Dear Mr. Chairman: Thank you for your letter of July 12,
    1995, regarding a bill reported by the Committee on Banking and
    Financial Services, H.R. 1858, the Financial Institutions
    Regulatory Relief Act of 1995.
        I appreciate the interest that the Committee on
    Transportation and Infrastructure has in this important
    legislation. I agree that your Committee has a right to
    sequential referral of Title III of H.R. 1858. Therefore, I am
    most appreciative of your decision not to request such a
    referral in the interest of accommodating the schedule for
    consideration of the bill.
        You have my assurance that agreements worked out by our
    respective staffs will be included in a manager's amendment as
    we take the bill to the House floor and that I will support
    your request to be conferees on Title III of the bill.
        Thank you for your cooperation in this matter.
                Sincerely,
                                              James A. Leach, Chairman.