[House Report 119-249]
[From the U.S. Government Publishing Office]
119th Congress } { Report
HOUSE OF REPRESENTATIVES
1st Session } { 119-249
======================================================================
SUPERVISORY MODIFICATIONS FOR APPROPRIATE RISK-
BASED TESTING ACT OF 2025
_______
September 8, 2025.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
_______
Mr. Hill of Arkansas, from the Committee on Financial Services,
submitted the following
R E P O R T
[To accompany H.R. 4437]
The Committee on Financial Services, to whom was referred
the bill (H.R. 4437) to reduce the regulatory burden on certain
well managed and well capitalized financial institutions, and
for other purposes, having considered the same, reports
favorably thereon with an amendment and recommends that the
bill as amended do pass.
CONTENTS
Page
Purpose and Summary.............................................. 4
Background and Need for Legislation.............................. 4
Committee Consideration.......................................... 5
Related Hearing.................................................. 5
Committee Votes.................................................. 5
Committee Oversight Findings..................................... 8
Performance Goals and Objectives................................. 8
Committee Cost Estimate.......................................... 8
New Budget Authority and CBO Cost Estimate....................... 8
Unfunded Mandates Statement...................................... 8
Earmark Statement................................................ 8
Federal Advisory Committee Act Statement......................... 9
Applicability to the Legislative Branch.......................... 9
Duplication of Federal Programs.................................. 9
Section-by-Section Analysis of the Legislation................... 9
Changes in Existing Law Made by the Bill, as Reported............ 9
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Supervisory Modifications for
Appropriate Risk-based Testing Act of 2025'' or the ``SMART Act of
2025''.
SEC. 2. EXAMINATION RELIEF FOR CERTAIN WELL MANAGED AND WELL
CAPITALIZED FINANCIAL INSTITUTIONS.
(a) Insured Depository Institutions.--Section 10(d) of the Federal
Deposit Insurance Act (12 U.S.C. 1820(d)) is amended by adding at the
end the following:
``(11) Examination relief for certain well managed and well
capitalized insured depository institutions.--
``(A) In general.--The following shall apply to a
well managed and well capitalized insured depository
institution with $6,000,000,000 or less in consolidated
assets:
``(i) Alternating limited-scope
examinations.--After an insured depository
institution receives a full-scope, on-site
examination from the appropriate Federal
banking agency, the next examination of the
insured depository institution by the
appropriate Federal banking agency shall be a
limited-scope examination, as determined by the
appropriate Federal banking agency.
``(ii) Combined examinations.--If an insured
depository institution is otherwise subject to
separate safety and soundness examinations,
consumer compliance examinations, and
information technology and cybersecurity
examinations, the appropriate Federal banking
agency shall, upon request of the insured
depository institution, combine two or three
such examinations, as specified by the insured
depository institution, and carry them out at
the same time.
``(B) Exception.--Subparagraph (A) shall not apply to
an insured depository institution if--
``(i) the insured depository institution is
currently subject to a formal enforcement
proceeding or order by the Corporation or the
appropriate Federal banking agency; or
``(ii) a person acquired control of the
insured depository institution since the most
recent full-scope, on-site examination of the
insured depository institution from the
appropriate Federal banking agency.
``(C) Rulemaking.--Not later than 12 months after the
date of enactment of this paragraph, the Federal
banking agencies shall issue rules to carry out
subparagraph (A), including, with respect to an insured
depository institution described under subparagraph
(A), to--
``(i) establish procedures for the limited-
scope examinations described in subparagraph
(A)(i);
``(ii) establish procedures for reviewing
insured depository institutions that--
``(I) experience material changes in
financial condition or operational risk
profile between scheduled examinations;
or
``(II) have failed to comply with
Federal or State banking laws and
regulations; and
``(iii) balance the goals of streamlining the
examination cycle for individual insured
depository institutions and reducing
unnecessary regulatory burdens while
maintaining sufficient oversight to ensure the
continued safety and soundness of the insured
depository institutions and compliance with all
applicable laws and regulations.
``(D) Rule of construction.--Nothing in this
paragraph may be construed to limit the authority of a
Federal banking agency to conduct off-site monitoring,
targeted reviews, or additional full-scope, on-site
examinations of an insured depository institution if
the Federal banking agency determines such monitoring,
reviews, or examinations are necessary to ensure safety
and soundness or compliance with applicable laws.
``(E) Definitions.--In this paragraph:
``(i) Consumer compliance examination.--The
term `consumer compliance examination' means an
examination to assess compliance with the
requirements of Federal consumer financial law
(as such term is defined in section 1002 of the
Consumer Financial Protection Act of 2010).
``(ii) Well capitalized.--The term `well
capitalized' has the meaning given that term in
section 38(b).
``(iii) Well managed.--With respect to an
insured depository institution, the term `well
managed' means that, when the institution was
most recently examined by the appropriate
Federal banking agency, the institution was
found to be well managed, and the institution's
composite condition was found to be
satisfactory or outstanding.''.
(b) Insured Credit Unions.--Section 204 of the Federal Credit Union
Act (12 U.S.C. 1784) is amended by adding at the end the following:
``(h) Examination Relief for Certain Well Managed and Well
Capitalized Insured Credit Unions.--
``(1) In general.--The following shall apply to a well
managed and well capitalized insured credit union with
$6,000,000,000 or less in consolidated assets:
``(A) Alternating limited-scope examinations.--After
an insured credit union receives a full-scope, on-site
examination from the National Credit Union
Administration, the next examination of the insured
credit union by the National Credit Union
Administration shall be a limited-scope examination, as
determined by the National Credit Union Administration.
``(B) Combined examinations.--If an insured credit
union is otherwise subject to separate safety and
soundness examinations, consumer compliance
examinations, and information technology and
cybersecurity examinations, the National Credit Union
Administration shall, upon request of the insured
credit union, combine two or three such examinations,
as specified by the insured credit union, and carry
them out at the same time.
``(2) Exception.--Paragraph (1) shall not apply to an insured
credit union if the insured credit union is currently subject
to a formal enforcement proceeding or order by the National
Credit Union Administration.
``(3) Rulemaking.--Not later than 12 months after the date of
enactment of this subsection, the National Credit Union
Administration shall issue rules to carry out paragraph (1),
including, with respect to an insured credit union described
under paragraph (1), to--
``(A) establish procedures for the limited-scope
examinations described in paragraph (1)(A);
``(B) establish procedures for reviewing insured
credit unions that--
``(i) experience material changes in
financial condition or operational risk profile
between scheduled examinations; or
``(ii) have failed to comply with Federal or
State banking laws and regulations; and
``(C) balance the goals of streamlining the
examination cycle for individual insured credit unions
and reducing unnecessary regulatory burdens while
maintaining sufficient oversight to ensure the
continued safety and soundness of the insured credit
unions and compliance with all applicable laws and
regulations.
``(4) Rule of construction.--Nothing in this subsection may
be construed to limit the authority of the National Credit
Union Administration to conduct off-site monitoring, targeted
reviews, or additional full-scope, on-site examinations of an
insured credit union if the National Credit Union
Administration determines such monitoring, reviews, or
examinations are necessary to ensure safety and soundness or
compliance with applicable laws.
``(5) Definitions.--In this paragraph:
``(A) Consumer compliance examination.--The term
`consumer compliance examination' means an examination
to assess compliance with the requirements of Federal
consumer financial law (as such term is defined in
section 1002 of the Consumer Financial Protection Act
of 2010).
``(B) Well capitalized.--The term `well capitalized'
has the meaning given that term in section 216(c).
``(C) Well managed.--With respect to an insured
credit union, the term `well managed' means that, when
the credit union was most recently examined by the
National Credit Union Administration, the credit union
was found to be well managed, and the credit union's
composite condition was found to be satisfactory or
outstanding.''.
SEC. 3. EXAMINATION PRACTICES.
(a) Insured Depository Institutions.--Section 10(d) of the Federal
Deposit Insurance Act (12 U.S.C. 1820(d)), as amended by section 2(a),
is further amended by adding at the end the following:
``(12) Examination practices.--With respect to on-site
examination of an insured depository institution with less than
$6,000,000,000 in total assets, the appropriate Federal banking
agency shall--
``(A) ensure the examination is led by, to the
maximum extent practicable, an examiner with
significant experience as an examiner;
``(B) make every effort, to the maximum extent
practicable, to minimize the number of examiners
utilized and the amount of time spent at the
institution to carry out the examination;
``(C) make every effort, to the maximum extent
practicable, to schedule the examination at a time that
is convenient for the institution; and
``(D) to the maximum extent practicable, give the
institution advance notice of issues expected to be
covered in the examination.
``(13) Report.--In its annual report to Congress, each
Federal banking agency shall include--
``(A) information on how the agency is complying with
paragraphs (11) and (12); and
``(B) aggregate data summarizing the agency's
examination practices with respect to insured
depository institutions with less than $6,000,000,000
in total assets, including--
``(i) the average experience of examiners,
including the average number of years of
examiner experience of those who lead on-site
examinations;
``(ii) the average number of examiners
utilized; and
``(iii) the average amount of time the agency
spends visiting such institutions for on-site
examinations.''.
(b) Insured Credit Unions.--Section 204 of the Federal Credit Union
Act (12 U.S.C. 1784), as amended by section 2(b), is further amended by
adding at the end the following:
``(i) Examination Practices.--With respect to on-site examination of
an insured credit union with less than $6,000,000,000 in total assets,
the National Credit Union Administration shall--
``(1) ensure the examination is led by, to the maximum extent
practicable, an examiner with significant experience as an
examiner;
``(2) make every effort, to the maximum extent practicable,
to minimize the number of examiners utilized and the amount of
time spent at the credit union to carry out the examination;
``(3) make every effort, to the maximum extent practicable,
to schedule the examination at a time that is convenient for
the credit union; and
``(4) to the maximum extent practicable, give the credit
union advance notice of issues expected to be covered in the
examination.
``(j) Report.--In its annual report to Congress, the National Credit
Union Administration shall include--
``(1) information on how the Administration is complying with
subsections (h) and (i); and
``(2) aggregate data summarizing the Administration's
examination practices with respect to insured credit unions
with less than $6,000,000,000 in total assets, including--
``(A) the average experience of examiners, including
the average number of years of examiner experience of
those who lead on-site examinations;
``(B) the average number of examiners utilized; and
``(C) the average amount of time the Administration
spends visiting such credit unions for on-site
examinations.''.
Purpose and Summary
H.R. 4437, the Supervisory Modifications for Appropriate
Risk-based Testing (SMART) Act of 2025, was introduced on July
16, 2025, by Republican Representative William Timmons (SC-04).
H.R. 4437 provides targeted regulatory relief to well-managed
and well-capitalized financial institutions with assets under
$10 billion by instituting alternating limited-scope
examinations and allowing those institutions to opt into
combining safety and soundness, consumer compliance, and
information technology and cybersecurity examinations to
streamline oversight.
Background and Need for Legislation
Federal bank supervision grants agencies, including the
Federal Reserve System, Office of the Comptroller of the
Currency, Federal Deposit Insurance Corporation, and Consumer
Financial Protection Bureau, the authority to monitor banks
through on-site exams, reporting requirements, and corrective
actions to ensure financial safety and systemic stability.
While supervision is essential, the existing prudential
regulatory framework can impose disproportionately high
compliance costs on smaller, well-managed institutions that do
not pose significant risks. H.R. 4437 offers targeted relief by
alternating between full-scope, on-site examinations and off-
site, limited-scope examinations, and by allowing institutions
to opt into merging safety and soundness, consumer compliance,
and information technology and cybersecurity examinations. This
approach lowers unnecessary regulatory burdens, freeing
resources for institutions to better serve their communities
and support economic growth, while maintaining robust oversight
where it is most needed.
Committee Consideration
119TH CONGRESS
On July 16, 2025, Representative Timmons introduced H.R.
4437, the SMART Act of 2025, with Representative Bill Foster
(D-IL) as an original cosponsor. The bill was referred solely
to the Committee on Financial Services. The bill was attached
to the April 29, 2025, hearing titled ``Regulatory Overreach:
The Price Tag on American Prosperity.''
On July 22, 2025, the Committee on Financial Services met
in open session to consider, among others, H.R. 4437. The
Committee ordered H.R. 4437, as amended, to be favorably
reported to the House of Representatives.
Related Hearing
Pursuant to clause 3(c)(6) of rule XIII of the Rules of the
House of Representatives, the following hearing was used to
develop H.R. 4437:
The Financial Institutions Subcommittee of the Committee on
Financial Services held an April 29, 2025, hearing titled
``Regulatory Overreach: The Price Tag on American Prosperity.''
A discussion draft version of the bill was attached to the
hearing. The following witnesses testified: Ms. Sarah Christine
Flowers, Senior Vice President, Senior Associate General
Counsel, Bank Policy Institute; Mr. Michael Radcliffe, Chairman
& Chief Executive Officer, Community Financial Services Bank;
Mrs. Margaret E. Tahyar, Partner, Head of Financial
Institutions Group, Davis Polk & Wardwell LLP; and The
Honorable Graham Steele, Academic Fellow, Rock Center for
Corporate Governance, Stanford Law School.
Committee Votes
Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee Report to include record
votes on the motion to report legislation and amendments
thereto.
On July 22, 2025, the Committee ordered H.R. 4437, as
amended, to be reported favorably to the House by a recorded
vote of 53 yeas and 1 nay. (Record Vote No. FC-185).
The Committee considered the following amendment to H.R.
4437:
Representative Maxine Waters (D-CA) offered
an amendment (No. 10), designated Waters_078. This
amendment directs the Federal financial regulators to
ensure on-site examinations of qualified financial
institutions are led by an examiner with significant
experience as an examiner. This amendment also requires
the Federal financial regulators to minimize the number
of examiners utilized and to schedule exams at a
convenient time for the institution. The Federal
financial regulators shall submit in its annual report
to Congress how the agency is complying with
requirements set forth in this act as well as aggregate
data summarizing the agency's examination practices for
small financial institutions. The amendment was agreed
to by voice vote.
Committee Oversight Findings
Pursuant to clause 3(c) of rule XIII of the Rules of the
House of Representatives, 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.
Performance Goals and Objectives
Pursuant to clause 3(c)(4) of rule XIII of the Rules of the
House of Representatives, the goal of H.R. 4437 is to reduce
the regulatory burden on certain well-managed and well-
capitalized financial institutions.
Committee Cost Estimate
Clause 3(d)(1) of rule XIII of the Rules of the House of
Representatives requires an estimate and a comparison of the
costs that would be incurred in carrying out H.R. 4437. The
Committee has requested but not received a cost estimate from
the Director of the Congressional Budget Office. However,
pursuant to clause 3(d)(1) of rule XIII of the Rules of the
House of Representatives, the Committee will adopt as its own
the cost estimate by the Director of the Congressional Budget
Office once it has been prepared.
New Budget Authority and CBO Cost Estimate
With respect to the requirements of clause 3(c)(2) of rule
XIII of the Rules of the House of Representatives and section
308(a) of the Congressional Budget Act of 1974 and with respect
to requirements of clause 3(c)(3) of rule XIII of the Rules of
the House of Representatives and section 402 of the
Congressional Budget Act of 1974, the Committee will adopt as
its own the cost estimate for the bill prepared by the Director
of the Congressional Budget Office. However, a cost estimate
was not made available to the Committee in time for the filing
of this report. The Chairman of the Committee shall cause such
estimate to be printed in the Congressional Record upon its
receipt by the Committee.
Unfunded Mandates Statement
The Committee has requested but not received from the
Director of the Congressional Budget Office an estimate of the
Federal mandates pursuant to section 423 of the Unfunded
Mandates Reform Act. The Chairman of the Committee shall cause
such estimate to be printed in the Congressional Record upon
its receipt by the Committee.
Earmark Statement
In compliance with clause 9 of rule XXI of the Rules of the
House of Representatives, this bill, as reported, contains no
congressional earmarks, limited tax benefits, or limited tariff
benefits as defined in clause 9(e), 9(f), or 9(g) of rule XXI.
Federal Advisory Committee Act Statement
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act were created by this
legislation.
Applicability to the Legislative Branch
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act.
Duplication of Federal Programs
Pursuant to clause 3(c)(5) of rule XIII of the Rules of the
House of Representatives, the Committee states that no
provision of the bill establishes or reauthorizes a program of
the Federal Government known to be duplicative of another
Federal program, including any program that was included in a
report to Congress pursuant to section 21 of the Public Law
111-139 or the most recent Catalog of Federal Domestic
Assistance.
Section-by-Section Analysis of the Legislation
Section 1. Short title
Section 1 provides the short title is the ``Supervisory
Modifications for Appropriate Risk-based Testing Act of 2025''
or the ``SMART Act of 2025.''
Section 2. Examination relief for certain well managed and well
capitalized financial institutions
This section provides for alternating limited-scope
examinations and combined examinations for well-capitalized and
well-managed financial institutions with $6 billion or less in
consolidated assets. Qualified financial institutions may
receive a limited-scope examination after the institution
receives a full-scope, on-site examination from the appropriate
Federal banking agency. Covered financial institutions that are
otherwise subject to a separate safety and soundness, consumer
compliance, and information technology and cybersecurity
examinations may request two or three such examinations be
combined.
This section provides exceptions for covered financial
institutions if (1) the institution is currently subject to a
formal enforcement proceeding or order, or (2) there was a
change in control of the institution since the most recent
full-scope, on-site examination of the institution.
This section directs the Federal banking agencies to issue
rules to establish procedures for the limited-scope
examinations and to balance the goals of streamlining the
examination cycle for covered institutions and reducing
unnecessary regulatory burdens while maintaining sufficient
oversight.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) 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 (new matter is
printed in italics and existing law in which no change is
proposed is shown in roman):
FEDERAL DEPOSIT INSURANCE ACT
* * * * * * *
Sec. 10. (a) The Board of Directors shall administer the
affairs of the Corporation fairly and impartially and without
discrimination. The Board of Directors of the Corporation shall
determine and prescribe the manner in which its obligations
shall be incurred and its expenses allowed and paid. The
Corporation shall be entitled to the free use of the United
States mails in the same manner as the executive departments of
the Government. The Corporation with the consent of any Federal
Reserve bank or of any board, commission, independent
establishment, or executive department of the Government,
including any field service thereof, may avail itself of the
use of information, services, and facilities thereof in
carrying out the provisions of this Act.
(b) Examinations.--
(1) Appointment of examiners and claims agents.--The
Board of Directors shall appoint examiners and claims
agents.
(2) Regular examinations.--Any examiner appointed
under paragraph (1) shall have power, on behalf of the
Corporation, to examine--
(A) any insured State nonmember bank or
insured State branch of any foreign bank;
(B) any depository institution which files an
application with the Corporation to become an
insured depository institution; and
(C) any insured depository institution in
default,
whenever the Board of Directors determines an
examination of any such depository institution is
necessary.
(3) Special examination of any insured depository
institution.--
(A) In general.--In addition to the
examinations authorized under paragraph (2),
any examiner appointed under paragraph (1)
shall have power, on behalf of the Corporation,
to make any special examination of any insured
depository institution or nonbank financial
company supervised by the Board of Governors or
a bank holding company described in section
165(a) of the Financial Stability Act of 2010,
whenever the Board of Directors determines that
a special examination of any such depository
institution is necessary to determine the
condition of such depository institution for
insurance purposes, or of such nonbank
financial company supervised by the Board of
Governors or bank holding company described in
section 165(a) of the Financial Stability Act
of 2010, for the purpose of implementing its
authority to provide for orderly liquidation of
any such company under title II of that Act,
provided that such authority may not be used
with respect to any such company that is in a
generally sound condition.
(B) Limitation.--Before conducting a special
examination of a nonbank financial company
supervised by the Board of Governors or a bank
holding company described in section 165(a) of
the Financial Stability Act of 2010, the
Corporation shall review any available and
acceptable resolution plan that the company has
submitted in accordance with section 165(d) of
that Act, consistent with the nonbinding effect
of such plan, and available reports of
examination, and shall coordinate to the
maximum extent practicable with the Board of
Governors, in order to minimize duplicative or
conflicting examinations.
(4) Examination of affiliates.--
(A) In general.--In making any examination
under paragraph (2) or (3), any examiner
appointed under paragraph (1) shall have power,
on behalf of the Corporation, to make such
examinations of the affairs of any affiliate of
any depository institution as may be necessary
to disclose fully--
(i) the relationship between such
depository institution and any such
affiliate; and
(ii) the effect of such relationship
on the depository institution.
(B) Commitment by foreign banks to allow
examinations of affiliates.--No branch or
depository institution subsidiary of a foreign
bank may become an insured depository
institution unless such foreign bank submits a
written binding commitment to the Board of
Directors to permit any examination of any
affiliate of such branch or depository
institution subsidiary pursuant to subparagraph
(A) to the extent determined by the Board of
Directors to be necessary to carry out the
purposes of this Act.
(5) Examination of insured state branches.--The Board
of Directors shall--
(A) coordinate examinations of insured State
branches of foreign banks with examinations
conducted by the Board of Governors of the
Federal Reserve System under section 7(c)(1) of
the International Banking Act of 1978; and
(B) to the extent possible, participate in
any simultaneous examination of the United
States operations of a foreign bank requested
by the Board under such section.
(6) Power and duty of examiners.--Each examiner
appointed under paragraph (1) shall--
(A) have power to make a thorough examination
of any insured depository institution or
affiliate under paragraph (2), (3), (4), or
(5); and
(B) shall make a full and detailed report of
condition of any insured depository institution
or affiliate examined to the Corporation.
(7) Power of claim agents.--Each claim agent
appointed under paragraph (1) shall have power to
investigate and examine all claims for insured
deposits.
(c) In connection with examinations of insured depository
institutions and any State nonmember bank, savings association,
or other institution making application to become insured
depository institutions, and affiliates thereof, or with other
types of investigations to determine compliance with applicable
law and regulations, the appropriate Federal banking agency, or
its designated representatives, are authorized to administer
oaths and affirmations, and to examine and and to take and
preserve testimony under oath as to any matter in respect to
the affairs or ownership of any such bank or institution or
affiliate thereof, and to exercise such other powers as are set
forth in section 8(n) of this Act.
(d) Annual On-Site Examinations of All Insured Depository
Institutions Required.--
(1) In general.--The appropriate Federal banking
agency shall, not less than once during each 12-month
period, conduct a full-scope, on-site examination of
each insured depository institution.
(2) Examinations by corporation.--Paragraph (1) shall
not apply during any 12-month period in which the
Corporation has conducted a full-scope, on-site
examination of the insured depository institution.
(3) State examinations acceptable.--The examinations
required by paragraph (1) may be conducted in alternate
12-month periods, as appropriate, if the appropriate
Federal banking agency determines that an examination
of the insured depository institution conducted by the
State during the intervening 12-month period carries
out the purpose of this subsection.
(4) 18-month rule for certain small institutions.--
Paragraphs (1), (2), and (3) shall apply with ``18-
month'' substituted for ``12-month'' if--
(A) the insured depository institution has
total assets of less than $3,000,000,000;
(B) the institution is well capitalized, as
defined in section 38;
(C) when the institution was most recently
examined, it was found to be well managed, and
its composite condition--
(i) was found to be outstanding; or
(ii) was found to be outstanding or
good, in the case of an insured
depository institution that has total
assets of not more than $200,000,000;
(D) the insured institution is not currently
subject to a formal enforcement proceeding or
order by the Corporation or the appropriate
Federal banking agency; and
(E) no person acquired control of the
institution during the 12-month period in which
a full-scope, on-site examination would be
required but for this paragraph.
(5) Certain government-controlled institutions
exempted.--Paragraph (1) does not apply to--
(A) any institution for which the Corporation
is conservator; or
(B) any bridge depository institution, none
of the voting securities of which are owned by
a person or agency other than the Corporation.
(6) Coordinated examinations.--To minimize the
disruptive effects of examinations on the operations of
insured depository institutions--
(A) each appropriate Federal banking agency
shall, to the extent practicable and consistent
with principles of safety and soundness and the
public interest--
(i) coordinate examinations to be
conducted by that agency at an insured
depository institution and its
affiliates;
(ii) coordinate with the other
appropriate Federal banking agencies in
the conduct of such examinations;
(iii) work to coordinate with the
appropriate State bank supervisor--
(I) the conduct of all
examinations made pursuant to
this subsection; and
(II) the number, types, and
frequency of reports required
to be submitted to such
agencies and supervisors by
insured depository
institutions, and the type and
amount of information required
to be included in such reports;
and
(iv) use copies of reports of
examinations of insured depository
institutions made by any other Federal
banking agency or appropriate State
bank supervisor to eliminate
duplicative requests for information;
and
(B) not later than 2 years after the date of
enactment of the Riegle Community Development
and Regulatory Improvement Act of 1994, the
Federal banking agencies shall jointly
establish and implement a system for
determining which one of the Federal banking
agencies or State bank supervisors shall be the
lead agency responsible for managing a unified
examination of each insured depository
institution and its affiliates, as required by
this subsection.
(7) Separate examinations permitted.--Notwithstanding
paragraph (6), each appropriate Federal banking agency
may conduct a separate examination in an emergency or
under other exigent circumstances, or when the agency
believes that a violation of law may have occurred.
(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.
(9) 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).
(10) 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
$200,000,000 to an amount not to exceed $3,000,000,000
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.
(11) Examination relief for certain well managed and
well capitalized insured depository institutions.--
(A) In general.--The following shall apply to
a well managed and well capitalized insured
depository institution with $6,000,000,000 or
less in consolidated assets:
(i) Alternating limited-scope
examinations.--After an insured
depository institution receives a full-
scope, on-site examination from the
appropriate Federal banking agency, the
next examination of the insured
depository institution by the
appropriate Federal banking agency
shall be a limited-scope examination,
as determined by the appropriate
Federal banking agency.
(ii) Combined examinations.--If an
insured depository institution is
otherwise subject to separate safety
and soundness examinations, consumer
compliance examinations, and
information technology and
cybersecurity examinations, the
appropriate Federal banking agency
shall, upon request of the insured
depository institution, combine two or
three such examinations, as specified
by the insured depository institution,
and carry them out at the same time.
(B) Exception.--Subparagraph (A) shall not
apply to an insured depository institution if--
(i) the insured depository
institution is currently subject to a
formal enforcement proceeding or order
by the Corporation or the appropriate
Federal banking agency; or
(ii) a person acquired control of the
insured depository institution since
the most recent full-scope, on-site
examination of the insured depository
institution from the appropriate
Federal banking agency.
(C) Rulemaking.--Not later than 12 months
after the date of enactment of this paragraph,
the Federal banking agencies shall issue rules
to carry out subparagraph (A), including, with
respect to an insured depository institution
described under subparagraph (A), to--
(i) establish procedures for the
limited-scope examinations described in
subparagraph (A)(i);
(ii) establish procedures for
reviewing insured depository
institutions that--
(I) experience material
changes in financial condition
or operational risk profile
between scheduled examinations;
or
(II) have failed to comply
with Federal or State banking
laws and regulations; and
(iii) balance the goals of
streamlining the examination cycle for
individual insured depository
institutions and reducing unnecessary
regulatory burdens while maintaining
sufficient oversight to ensure the
continued safety and soundness of the
insured depository institutions and
compliance with all applicable laws and
regulations.
(D) Rule of construction.--Nothing in this
paragraph may be construed to limit the
authority of a Federal banking agency to
conduct off-site monitoring, targeted reviews,
or additional full-scope, on-site examinations
of an insured depository institution if the
Federal banking agency determines such
monitoring, reviews, or examinations are
necessary to ensure safety and soundness or
compliance with applicable laws.
(E) Definitions.--In this paragraph:
(i) Consumer compliance
examination.--The term ``consumer
compliance examination'' means an
examination to assess compliance with
the requirements of Federal consumer
financial law (as such term is defined
in section 1002 of the Consumer
Financial Protection Act of 2010).
(ii) Well capitalized.--The term
``well capitalized'' has the meaning
given that term in section 38(b).
(iii) Well managed.--With respect to
an insured depository institution, the
term ``well managed'' means that, when
the institution was most recently
examined by the appropriate Federal
banking agency, the institution was
found to be well managed, and the
institution's composite condition was
found to be satisfactory or
outstanding.
(12) Examination practices.--With respect to on-site
examination of an insured depository institution with
less than $6,000,000,000 in total assets, the
appropriate Federal banking agency shall--
(A) ensure the examination is led by, to the
maximum extent practicable, an examiner with
significant experience as an examiner;
(B) make every effort, to the maximum extent
practicable, to minimize the number of
examiners utilized and the amount of time spent
at the institution to carry out the
examination;
(C) make every effort, to the maximum extent
practicable, to schedule the examination at a
time that is convenient for the institution;
and
(D) to the maximum extent practicable, give
the institution advance notice of issues
expected to be covered in the examination.
(13) Report.--In its annual report to Congress, each
Federal banking agency shall include--
(A) information on how the agency is
complying with paragraphs (11) and (12); and
(B) aggregate data summarizing the agency's
examination practices with respect to insured
depository institutions with less than
$6,000,000,000 in total assets, including--
(i) the average experience of
examiners, including the average number
of years of examiner experience of
those who lead on-site examinations;
(ii) the average number of examiners
utilized; and
(iii) the average amount of time the
agency spends visiting such
institutions for on-site examinations.
(e) Examination Fees.--
(1) Regular and special examinations of depository
institutions.--The cost of conducting any regular
examination or special examination of any depository
institution under subsection (b)(2), (b)(3), or (d) or
of any entity described in section 3(q)(2) may be
assessed by the Corporation against the institution or
entity to meet the expenses of the Corporation in
carrying out such examinations.
(2) Examination of affiliates.--The cost of
conducting any examination of any affiliate of any
insured depository institution under subsection (b)(4)
may be assessed by the Corporation against each
affiliate which is examined to meet the Corporation's
expenses in carrying out such examination.
(3) Assessment against depository institution in case
of affiliate's refusal to pay.--
(A) In general.--Subject to subparagraph (B),
if any affiliate of any insured depository
institution--
(i) refuses to pay any assessment
under paragraph (2); or
(ii) fails to pay any such assessment
before the end of the 60-day period
beginning on the date the affiliate
receives notice of the assessment,
the Corporation may assess such cost against,
and collect such cost from, the depository
institution.
(B) Affiliate of more than 1 depository
institution.--If any affiliate referred to in
subparagraph (A) is an affiliate of more than 1
insured depository institution, the assessment
under subparagraph (A) may be assessed against
the depository institutions in such proportions
as the Corporation determines to be
appropriate.
(4) Civil money penalty for affiliate's refusal to
cooperate.--
(A) Penalty imposed.--If any affiliate of any
insured depository institution--
(i) refuses to permit an examiner
appointed by the Board of Directors
under subsection (b)(1) to conduct an
examination; or
(ii) refuses to provide any
information required to be disclosed in
the course of any examination,
the depository institution shall forfeit and
pay a penalty of not more than $5,000 for each
day that any such refusal continues.
(B) Assessment and collection.--Any penalty
imposed under subparagraph (A) shall be
assessed and collected by the Corporation in
the manner provided in section 8(i)(2).
(5) Deposits of examination assessment.--Amounts
received by the Corporation under this subsection
(other than paragraph (4)) may be deposited in the
manner provided in section 13.
(f) Preservation of Agency Records.--
(1) In general.--A Federal banking agency may cause
any and all records, papers, or documents kept by the
agency or in the possession or custody of the agency to
be--
(A) photographed or microphotographed or
otherwise reproduced upon film; or
(B) preserved in any electronic medium or
format which is capable of--
(i) being read or scanned by
computer; and
(ii) being reproduced from such
electronic medium or format by printing
any other form of reproduction of
electronically stored data.
(2) Treatment as original records.--Any photographs,
microphotographs, or photographic film or copies
thereof described in paragraph (1)(A) or reproduction
of electronically stored data described in paragraph
(1)(B) shall be deemed to be an original record for all
purposes, including introduction in evidence in all
State and Federal courts or administrative agencies,
and shall be admissible to prove any act, transaction,
occurrence, or event therein recorded.
(3) Authority of the federal banking agencies.--Any
photographs, microphotographs, or photographic film or
copies thereof described in paragraph (1)(A) or
reproduction of electronically stored data described in
paragraph (1)(B) shall be preserved in such manner as
the Federal banking agency shall prescribe, and the
original records, papers, or documents may be destroyed
or otherwise disposed of as the Federal banking agency
may direct.
(g) Authority To Prescribe Regulations and Definitions.--
Except to the extent that authority under this Act is conferred
on any of the Federal banking agencies other than the
Corporation, the Corporation may--
(1) prescribe regulations to carry out this Act; and
(2) by regulation define terms as necessary to carry
out this Act.
(h) Coordination of Examination Authority.--
(1) State bank supervisors of home and host states.--
(A) Home state of bank.--The appropriate
State bank supervisor of the home State of an
insured State bank has authority to examine and
supervise the bank.
(B) Host state branches.--The State bank
supervisor of the home State of an insured
State bank and any State bank supervisor of an
appropriate host State shall exercise its
respective authority to supervise and examine
the branches of the bank in a host State in
accordance with the terms of any applicable
cooperative agreement between the home State
bank supervisor and the State bank supervisor
of the relevant host State.
(C) Supervisory fees.--Except as expressly
provided in a cooperative agreement between the
State bank supervisors of the home State and
any host State of an insured State bank, only
the State bank supervisor of the home State of
an insured State bank may levy or charge State
supervisory fees on the bank.
(2) Host state examination.--
(A) In general.--With respect to a branch
operated in a host State by an out-of-State
insured State bank that resulted from an
interstate merger transaction approved under
section 44, or that was established in such
State pursuant to section 5155(g) of the
Revised Statutes of the United States, the
third undesignated paragraph of section 9 of
the Federal Reserve Act or section 18(d)(4) of
this Act, the appropriate State bank supervisor
of such host State may--
(i) with written notice to the State
bank supervisor of the bank's home
State and subject to the terms of any
applicable cooperative agreement with
the State bank supervisor of such home
State, examine such branch for the
purpose of determining compliance with
host State laws that are applicable
pursuant to section 24(j), including
those that govern community
reinvestment, fair lending, and
consumer protection; and
(ii) if expressly permitted under and
subject to the terms of a cooperative
agreement with the State bank
supervisor of the bank's home State or
if such out-of-State insured State bank
has been determined to be in a troubled
condition by either the State bank
supervisor of the bank's home State or
the bank's appropriate Federal banking
agency, participate in the examination
of the bank by the State bank
supervisor of the bank's home State to
ascertain that the activities of the
branch in such host State are not
conducted in an unsafe or unsound
manner.
(B) Notice of determination.--
(i) In general.--The State bank
supervisor of the home State of an
insured State bank shall notify the
State bank supervisor of each host
State of the bank if there has been a
final determination that the bank is in
a troubled condition.
(ii) Timing of notice.--The State
bank supervisor of the home State of an
insured State bank shall provide notice
under clause (i) as soon as is
reasonably possible, but in all cases
not later than 15 business days after
the date on which the State bank
supervisor has made such final
determination or has received written
notification of such final
determination.
(3) Host state enforcement.--If the State bank
supervisor of a host State determines that a branch of
an out-of-State insured State bank is violating any law
of the host State that is applicable to such branch
pursuant to section 24(j), including a law that governs
community reinvestment, fair lending, or consumer
protection, the State bank supervisor of the host State
or, to the extent authorized by the law of the host
State, a host State law enforcement officer may, with
written notice to the State bank supervisor of the
bank's home State and subject to the terms of any
applicable cooperative agreement with the State bank
supervisor of the bank's home State, undertake such
enforcement actions and proceedings as would be
permitted under the law of the host State as if the
branch were a bank chartered by that host State.
(4) Cooperative agreement.--
(A) In general.--The State bank supervisors
from 2 or more States may enter into
cooperative agreements to facilitate State
regulatory supervision of State banks,
including cooperative agreements relating to
the coordination of examinations and joint
participation in examinations.
(B) Definition.--For purposes of this
subsection, the term ``cooperative agreement''
means a written agreement that is signed by the
home State bank supervisor and the host State
bank supervisor to facilitate State regulatory
supervision of State banks, and includes
nationwide or multi-State cooperative
agreements and cooperative agreements solely
between the home State and host State.
(C) Rule of construction.--Except for State
bank supervisors, no provision of this
subsection relating to such cooperative
agreements shall be construed as limiting in
any way the authority of home State and host
State law enforcement officers, regulatory
supervisors, or other officials that have not
signed such cooperative agreements to enforce
host State laws that are applicable to a branch
of an out-of-State insured State bank located
in the host State pursuant to section 24(j).
(5) Federal regulatory authority.--No provision of
this subsection shall be construed as limiting in any
way the authority of any Federal banking agency.
(6) State taxation authority not affected.--No
provision of this subsection shall be construed as
affecting the authority of any State or political
subdivision of any State to adopt, apply, or administer
any tax or method of taxation to any bank, bank holding
company, or foreign bank, or any affiliate of any bank,
bank holding company, or foreign bank, to the extent
that such tax or tax method is otherwise permissible by
or under the Constitution of the United States or other
Federal law.
(7) Definitions.--For purpose of this section, the
following definitions shall apply:
(A) Host state, home state, out-of-State
bank.--The terms ``host State'', ``home
State'', and ``out-of-State bank'' have the
same meanings as in section 44(g).
(B) State supervisory fees.--The term ``State
supervisory fees'' means assessments,
examination fees, branch fees, license fees,
and all other fees that are levied or charged
by a State bank supervisor directly upon an
insured State bank or upon branches of an
insured State bank.
(C) Troubled condition.--Solely for purposes
of paragraph (2)(B), an insured State bank has
been determined to be in ``troubled condition''
if the bank--
(i) has a composite rating, as
determined in its most recent report of
examination, of 4 or 5 under the
Uniform Financial Institutions Ratings
System;
(ii) is subject to a proceeding
initiated by the Corporation for
termination or suspension of deposit
insurance; or
(iii) is subject to a proceeding
initiated by the State bank supervisor
of the bank's home State to vacate,
revoke, or terminate the charter of the
bank, or to liquidate the bank, or to
appoint a receiver for the bank.
(D) Final determination.--For purposes of
paragraph (2)(B), the term ``final
determination'' means the transmittal of a
report of examination to the bank or
transmittal of official notice of proceedings
to the bank.
(i) Flood Insurance Compliance by Insured Depository
Institutions.--
(1) Examinations.--The appropriate Federal banking
agency shall, during each scheduled on-site examination
required by this section, determine whether the insured
depository institution is complying with the
requirements of the national flood insurance program.
(2) Report.--
(A) Requirement.--Not later than 1 year after
the date of enactment of the Riegle Community
Development and Regulatory Improvement Act of
1994 and biennially thereafter for the next 4
years, each appropriate Federal banking agency
shall submit a report to the Congress on
compliance by insured depository institutions
with the requirements of the national flood
insurance program.
(B) Contents.--Each report submitted under
this paragraph shall include a description of
the methods used to determine compliance, the
number of institutions examined during the
reporting year, a listing and total number of
institutions found not to be in compliance,
actions taken to correct incidents of
noncompliance, and an analysis of compliance,
including a discussion of any trends, patterns,
and problems, and recommendations regarding
reasonable actions to improve the efficiency of
the examinations processes.
(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 in the recommendations to be
given to such institution as a consequence of
any examinations.
(2) Examiner-in-charge.--Each appropriate Federal
banking agency shall consider appointing an examiner-
in-charge with respect to a depository institution to
ensure consultation on examination activities among all
of the examiners of that agency involved in
examinations of the institution.
(k) One-Year Restrictions on Federal Examiners of Financial
Institutions.--
(1) In general.--In addition to other applicable
restrictions set forth in title 18, United States Code,
the penalties set forth in paragraph (6) of this
subsection shall apply to any person who--
(A) was an officer or employee (including any
special Government employee) of a Federal
banking agency or a Federal reserve bank;
(B) served 2 or more months during the final
12 months of his or her employment with such
agency or entity as the senior examiner (or a
functionally equivalent position) of a
depository institution or depository
institution holding company with continuing,
broad responsibility for the examination (or
inspection) of that depository institution or
depository institution holding company on
behalf of the relevant agency or Federal
reserve bank; and
(C) within 1 year after the termination date
of his or her service or employment with such
agency or entity, knowingly accepts
compensation as an employee, officer, director,
or consultant from--
(i) such depository institution, any
depository institution holding company
that controls such depository
institution, or any other company that
controls such depository institution;
or
(ii) such depository institution
holding company or any depository
institution that is controlled by such
depository institution holding company.
(2) Definitions.--For purposes of this subsection--
(A) the term ``depository institution''
includes an uninsured branch or agency of a
foreign bank, if such branch or agency is
located in any State; and
(B) the term ``depository institution holding
company'' includes any foreign bank or company
described in section 8(a) of the International
Banking Act of 1978.
(3) Rules of construction.--For purposes of this
subsection, a foreign bank shall be deemed to control
any branch or agency of the foreign bank, and a person
shall be deemed to act as a consultant for a depository
institution, depository institution holding company, or
other company, only if such person directly works on
matters for, or on behalf of, such depository
institution, depository institution holding company, or
other company.
(4) Regulations.--
(A) In general.--Each Federal banking agency
shall prescribe rules or regulations to
administer and carry out this subsection,
including rules, regulations, or guidelines to
define the scope of persons referred to in
paragraph (1)(B).
(B) Consultation required.--The Federal
banking agencies shall consult with each other
for the purpose of assuring that the rules and
regulations issued by the agencies under
subparagraph (A) are, to the extent possible,
consistent, comparable, and practicable, taking
into account any differences in the supervisory
programs utilized by the agencies for the
supervision of depository institutions and
depository institution holding companies.
(5) Waiver.--
(A) Agency authority.--A Federal banking
agency may grant a waiver, on a case by case
basis, of the restriction imposed by this
subsection to any officer or employee
(including any special Government employee) of
that agency, and the Board of Governors of the
Federal Reserve System may grant a waiver of
the restriction imposed by this subsection to
any officer or employee of a Federal reserve
bank, if the head of such agency certifies in
writing that granting the waiver would not
affect the integrity of the supervisory program
of the relevant Federal banking agency.
(B) Definition.--For purposes of this
paragraph, the head of an agency is--
(i) the Comptroller of the Currency,
in the case of the Office of the
Comptroller of the Currency;
(ii) the Chairman of the Board of
Governors of the Federal Reserve
System, in the case of the Board of
Governors of the Federal Reserve
System; and
(iii) the Chairperson of the Board of
Directors, in the case of the
Corporation.
(6) Penalties.--
(A) In general.--In addition to any other
administrative, civil, or criminal remedy or
penalty that may otherwise apply, whenever a
Federal banking agency determines that a person
subject to paragraph (1) has become associated,
in the manner described in paragraph (1)(C),
with a depository institution, depository
institution holding company, or other company
for which such agency serves as the appropriate
Federal banking agency, the agency shall impose
upon such person one or more of the following
penalties:
(i) Industry-wide prohibition
order.--The Federal banking agency
shall serve a written notice or order
in accordance with and subject to the
provisions of section 8(e)(4) for
written notices or orders under
paragraph (1) or (2) of section 8(e),
upon such person of the intention of
the agency--
(I) to remove such person
from office or to prohibit such
person from further
participation in the conduct of
the affairs of the depository
institution, depository
institution holding company, or
other company for a period of
up to 5 years; and
(II) to prohibit any further
participation by such person,
in any manner, in the conduct
of the affairs of any insured
depository institution for a
period of up to 5 years.
(ii) Civil monetary penalty.--The
Federal banking agency may, in an
administrative proceeding or civil
action in an appropriate United States
district court, impose on such person a
civil monetary penalty of not more than
$250,000. Any administrative proceeding
under this clause shall be conducted in
accordance with section 8(i). In lieu
of an action by the Federal banking
agency under this clause, the Attorney
General of the United States may bring
a civil action under this clause in the
appropriate United States district
court.
(B) Scope of prohibition order.--Any person
subject to an order issued under subparagraph
(A)(i) shall be subject to paragraphs (6) and
(7) of section 8(e) in the same manner and to
the same extent as a person subject to an order
issued under such section.
(C) Definitions.--Solely for purposes of this
paragraph, the ``appropriate Federal banking
agency'' for a company that is not a depository
institution or depository institution holding
company shall be the Federal banking agency on
whose behalf the person described in paragraph
(1) performed the functions described in
paragraph (1)(B).
* * * * * * *
----------
FEDERAL CREDIT UNION ACT
* * * * * * *
TITLE II--SHARE INSURANCE
* * * * * * *
examination of insured credit unions
Sec. 204. (a) The Board shall appoint examiners who shall
have power, on its behalf, to examine any insured credit union,
any credit union making application for insurance of its member
accounts, or any closed insured credit union whenever in the
judgment of the Board an examination is necessary to determine
the condition of any such credit union for insurance purposes.
Each examiner shall have power to make a thorough examination
of all of the affairs of the credit union and shall make a full
and detailed report of the condition of the credit union to the
Board. The Board in like manner shall appoint claim agents who
shall have power to investigate and examine all claims for
insured member accounts. Each claim agent shall have power to
administer oaths and affirmations, to examine and to take and
preserve testimony under oath as to any matter in respect to
claims for insured accounts, and to issue subpenas and subpenas
duces tecum and, for the enforcement thereof, to apply to the
United States district court for the judicial district or the
United States court in any territory in which the principal
office of the credit union is located or in which the witness
resides or carries on business. Such courts shall have
jurisdiction and power to order and require compliance with any
such subpena.
(b) In connection with examinations of insured credit unions,
or with other types of investigations to determine compliance
with applicable law and regulations, the Board, or its
designated representatives, shall have power to administer
oaths and affirmations, to examine and to take and preserve
testimony under oath as to any matter in respect of the affairs
of any such credit union, and to issue subpenas and subpenas
duces tecum and to exercise such other powers as are set forth
in section 206(p) and, for the enforcement thereof, to apply to
the United States district court for the judicial district or
the United States court in any territory in which the principal
office of the credit union is located or in which the witness
resides or carries on business. Such courts shall have
jurisdiction and power to order and require compliance with any
such subpena.
(c) In cases of refusal to obey a subpena issued to, or
contumacy by, any person, the Board may invoke the aid of any
court of the United States within the jurisdiction of which
such hearing, examination, or investigation is carried on, or
where such person resides or carries on business, in requiring
the attendance and testimony of witnesses and the production of
books, records, or other papers. Such court may issue an order
requiring such person to appear before the Board, or before a
person designated by them, there to produce records, if so
ordered, or to give testimony touching the matter in question.
Any failure to obey such order of the court may be punished by
such court as a contempt thereof. All process in any such case
may be served in the judicial district whereof such person is
an inhabitant or carries on business or wherever he may be
found. No person shall be excused from attending and testifying
or from producing books, records, or other papers in obedience
to a subpena issued under the authority of this title on the
ground that the testimony or evidence, documentary or
otherwise, required of him may tend to incriminate him or
subject him to penalty or forfeiture, but no individual shall
be prosecuted or subject to any penalty or forfeiture for or on
account of any transaction, matter, or thing concerning which
he is compelled to testify or produce evidence, documentary or
otherwise, after having claimed his privilege against self-
incrimination, except that such individual so testifying shall
not be exempt from prosecution and punishment for perjury
committed in so testifying.
(d) The Administration may accept any report of examination
made by or to any commission, board, or authority having
supervision of a State-chartered credit union and may furnish
to any such commission, board, or authority reports of
examination made on behalf of the Board.
(e) Flood Insurance Compliance by Insured Credit Unions.--
(1) Examination.--The Board shall, during each
examination conducted under this section, determine
whether the insured credit union is complying with the
requirements of the national flood insurance program.
(2) Report.--
(A) Requirement.--Not later than 1 year after
the date of enactment of the Riegle Community
Development and Regulatory Improvement Act of
1994 and biennially thereafter for the next 4
years, the Board shall submit a report to the
Congress on compliance by insured credit unions
with the requirements of the national flood
insurance program.
(B) Contents.--The report shall include a
description of the methods used to determine
compliance, the number of insured credit unions
examined during the reporting year, a listing
and total number of insured credit unions found
not to be in compliance, actions taken to
correct incidents of noncompliance, and an
analysis of compliance, including a discussion
of any trends, patterns, and problems, and
recommendations regarding reasonable actions to
improve the efficiency of the examinations
processes.
(f) Access to Liquidity.--The Board shall--
(1) periodically assess the potential liquidity needs
of each insured credit union, and the options that the
credit union has available for meeting those needs; and
(2) periodically assess the potential liquidity needs
of insured credit unions as a group, and the options
that insured credit unions have available for meeting
those needs.
(g) Sharing Information With Federal Reserve Banks.--The
Board shall, for the purpose of facilitating insured credit
unions' access to liquidity, make available to the Federal
reserve banks (subject to appropriate assurances of
confidentiality) information relevant to making advances to
such credit unions, including the Board's reports of
examination.
(h) Examination Relief for Certain Well Managed and Well
Capitalized Insured Credit Unions.--
(1) In general.--The following shall apply to a well
managed and well capitalized insured credit union with
$6,000,000,000 or less in consolidated assets:
(A) Alternating limited-scope examinations.--
After an insured credit union receives a full-
scope, on-site examination from the National
Credit Union Administration, the next
examination of the insured credit union by the
National Credit Union Administration shall be a
limited-scope examination, as determined by the
National Credit Union Administration.
(B) Combined examinations.--If an insured
credit union is otherwise subject to separate
safety and soundness examinations, consumer
compliance examinations, and information
technology and cybersecurity examinations, the
National Credit Union Administration shall,
upon request of the insured credit union,
combine two or three such examinations, as
specified by the insured credit union, and
carry them out at the same time.
(2) Exception.--Paragraph (1) shall not apply to an
insured credit union if the insured credit union is
currently subject to a formal enforcement proceeding or
order by the National Credit Union Administration.
(3) Rulemaking.--Not later than 12 months after the
date of enactment of this subsection, the National
Credit Union Administration shall issue rules to carry
out paragraph (1), including, with respect to an
insured credit union described under paragraph (1),
to--
(A) establish procedures for the limited-
scope examinations described in paragraph
(1)(A);
(B) establish procedures for reviewing
insured credit unions that--
(i) experience material changes in
financial condition or operational risk
profile between scheduled examinations;
or
(ii) have failed to comply with
Federal or State banking laws and
regulations; and
(C) balance the goals of streamlining the
examination cycle for individual insured credit
unions and reducing unnecessary regulatory
burdens while maintaining sufficient oversight
to ensure the continued safety and soundness of
the insured credit unions and compliance with
all applicable laws and regulations.
(4) Rule of construction.--Nothing in this subsection
may be construed to limit the authority of the National
Credit Union Administration to conduct off-site
monitoring, targeted reviews, or additional full-scope,
on-site examinations of an insured credit union if the
National Credit Union Administration determines such
monitoring, reviews, or examinations are necessary to
ensure safety and soundness or compliance with
applicable laws.
(5) Definitions.--In this paragraph:
(A) Consumer compliance examination.--The
term ``consumer compliance examination'' means
an examination to assess compliance with the
requirements of Federal consumer financial law
(as such term is defined in section 1002 of the
Consumer Financial Protection Act of 2010).
(B) Well capitalized.--The term ``well
capitalized'' has the meaning given that term
in section 216(c).
(C) Well managed.--With respect to an insured
credit union, the term ``well managed'' means
that, when the credit union was most recently
examined by the National Credit Union
Administration, the credit union was found to
be well managed, and the credit union's
composite condition was found to be
satisfactory or outstanding.
(i) Examination Practices.--With respect to on-site
examination of an insured credit union with less than
$6,000,000,000 in total assets, the National Credit Union
Administration shall--
(1) ensure the examination is led by, to the maximum
extent practicable, an examiner with significant
experience as an examiner;
(2) make every effort, to the maximum extent
practicable, to minimize the number of examiners
utilized and the amount of time spent at the credit
union to carry out the examination;
(3) make every effort, to the maximum extent
practicable, to schedule the examination at a time that
is convenient for the credit union; and
(4) to the maximum extent practicable, give the
credit union advance notice of issues expected to be
covered in the examination.
(j) Report.--In its annual report to Congress, the National
Credit Union Administration shall include--
(1) information on how the Administration is
complying with subsections (h) and (i); and
(2) aggregate data summarizing the Administration's
examination practices with respect to insured credit
unions with less than $6,000,000,000 in total assets,
including--
(A) the average experience of examiners,
including the average number of years of
examiner experience of those who lead on-site
examinations;
(B) the average number of examiners utilized;
and
(C) the average amount of time the
Administration spends visiting such credit
unions for on-site examinations.
* * * * * * *
[all]