Text: H.R.1278 — 101st Congress (1989-1990)All Information (Except Text)

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--H.R.1278--
H.R.1278
One Hundred First Congress of the United States of America
AT THE FIRST SESSION
Begun and held at the City of Washington on Tuesday, the third day of January,
one thousand nine hundred and eighty-nine
An Act
To reform, recapitalize, and consolidate the Federal deposit insurance
system, to enhance the regulatory and enforcement powers of Federal financial
institutions regulatory agencies, and for other purposes.
 Be it enacted by the Senate and House of Representatives of the United
 States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
 (a) SHORT TITLE- This Act may be cited as the `Financial Institutions Reform,
 Recovery, and Enforcement Act of 1989'.
 (b) TABLE OF CONTENTS-
TITLE I--PURPOSES
Sec. 101. Purposes.
TITLE II--FEDERAL DEPOSIT INSURANCE CORPORATION
Sec. 201. Depository institutions.
Sec. 202. Duties of Federal Deposit Insurance Corporation.
Sec. 203. FDIC Board members.
Sec. 204. Definitions.
Sec. 205. Insured savings associations.
Sec. 206. Application process; insurance fees.
Sec. 207. Insurability factors.
Sec. 208. Assessments.
Sec. 209. Corporate powers of the FDIC.
Sec. 210. Administration of Corporation.
Sec. 211. Insurance funds.
Sec. 212. Conservatorship and receivership powers of the Corporation.
Sec. 213. New banks.
Sec. 214. Bridge banks.
Sec. 215. FSLIC Resolution Fund.
Sec. 216. Amendments to section 12.
Sec. 217. Amendments to section 13.
Sec. 218. FDIC borrowing authority.
Sec. 219. Exemption from taxation; limitation on borrowing.
Sec. 220. Reports.
Sec. 221. Regulations governing insured depository institutions.
Sec. 222. Activities of savings associations.
Sec. 223. Nondiscrimination.
Sec. 224. Brokered deposits.
Sec. 225. Contracts between depository institutions and persons providing
goods, products, or services.
Sec. 226. Savings association insurance fund industry advisory committee
established.
TITLE III--SAVINGS ASSOCIATIONS
Sec. 301. Amendment to Home Owners' Loan Act of 1933.
Sec. 302. Savings provisions.
Sec. 303. Qualified thrift lender test.
Sec. 304. Transitional rule for certain transactions with affiliates.
Sec. 305. Transitional rules regarding certain loans and effective dates.
Sec. 306. Amendment of additional powers of Director.
Sec. 307. Amendment to title 31, United States Code.
Sec. 308. Preserving minority ownership of minority financial institutions.
TITLE IV--TRANSFER OF FUNCTIONS, PERSONNEL, AND PROPERTY
Sec. 401. FSLIC and Federal Home Loan Bank Board abolished.
Sec. 402. Continuation and coordination of certain regulations.
Sec. 403. Determination of transferred functions and employees.
Sec. 404. Rights of employees of abolished agencies.
Sec. 405. Division of property and facilities.
Sec. 406. Report.
Sec. 407. Repeals.
TITLE V--FINANCING FOR THRIFT RESOLUTIONS
Subtitle A--Oversight Board and Resolution Trust Corporation
Sec. 501. Oversight Board and Resolution Trust Corporation established.
Subtitle B--Resolution Funding Corporation
Sec. 511. Resolution Funding Corporation established.
Sec. 512. Financing Corporation.
TITLE VI--THRIFT ACQUISITION ENHANCEMENT PROVISIONS
Sec. 601. Acquisition of thrift institutions by bank holding companies.
Sec. 602. Technical amendments to the Bank Holding Company Act.
Sec. 603. Passive investments by companies controlling certain nonbank banks.
Sec. 604. Purchase of minority interest in undercapitalized savings
associations by other savings and loan holding companies allowed.
TITLE VII--FEDERAL HOME LOAN BANK SYSTEM REFORMS
Subtitle A--Federal Home Loan Bank Act Amendments
Sec. 701. Definitions.
Sec. 702. Federal Housing Finance Board established.
Sec. 703. Termination of the Federal Home Loan Bank Board.
Sec. 704. Eligibility for membership.
Sec. 705. Repeal of provision relating to rate of interest on deposits.
Sec. 706. Capital stock.
Sec. 707. Election of Bank directors.
Sec. 708. Repeal of provisions relating to certain powers of the Federal
Home Loan Bank Board.
Sec. 709. Powers and duties of Banks.
Sec. 710. Eligibility of borrowers to secure advances.
Sec. 711. Administrative expenses.
Sec. 712. Nonadministrative expenses.
Sec. 713. Federal Savings and Loan Insurance Corporation Industry Advisory
Committee.
Sec. 714. Advances.
Sec. 715. Amendments relating to withdrawal from Federal Home Loan Bank
membership.
Sec. 716. Repeal of provisions relating to lawful contract rate.
Sec. 717. Bank stock and obligations.
Sec. 718. Thrift Advisory Council.
Sec. 719. Examination of members.
Sec. 720. Liquidity.
Sec. 721. Affordable housing.
Sec. 722. Transferred employees of Federal Home Loan Banks and joint offices.
Sec. 723. Transitional provisions.
Sec. 724. Federal Home Loan Bank reserves.
Sec. 725. Special account.
Subtitle B--Federal Home Loan Mortgage Corporation
Sec. 731. Federal Home Loan Mortgage Corporation.
Subtitle C--Technical and Conforming Amendments
Sec. 741. Repeal of limitation of obligation for administrative expenses.
Sec. 742. Amendment of title 5, United States Code.
Sec. 743. Amendment of Balanced Budget and Emergency Deficit Control Act
provisions.
Sec. 744. Conforming amendments to financial institution related Acts.
TITLE VIII--BANK CONSERVATION ACT AMENDMENTS
Sec. 801. Definitions.
Sec. 802. Appointment of conservator.
Sec. 803. Examinations.
Sec. 804. Termination of conservatorship.
Sec. 805. Conservator; powers and duties.
Sec. 806. Liability protection.
Sec. 807. Rules and regulations.
Sec. 808. Repeals.
TITLE IX--REGULATORY ENFORCEMENT AUTHORITY AND CRIMINAL ENHANCEMENTS
Subtitle A--Expanded Enforcement Powers, Increased Penalties, and Improved
Accountability
Sec. 901. Institution-affiliated parties of a depository institution subject
to administrative enforcement orders; substitution of `depository institution'
for `bank' in enforcement provisions.
Sec. 902. Amendments to cease and desist authority with respect to restitution,
restrictions on specific activities, grounds for issuance of a temporary
order, and incomplete or inaccurate records.
Sec. 903. Merger of removal and prohibition authority.
Sec. 904. Industrywide application of removal, suspension, and prohibition
orders.
Sec. 905. Enforcement proceedings allowed after separation from service.
Sec. 906. Expansion of removal powers for state criminal proceedings.
Sec. 907. Amendments to expand and increase civil money penalties.
Sec. 908. Clarification of criminal penalty provisions for violation of
certain orders.
Sec. 909. Supervisory records.
Sec. 910. Increased penalty for participation by convicted individuals.
Sec. 911. Amendments to various provisions of law relating to reports.
Sec. 912. Authority of the FDIC to take enforcement action against savings
associations.
Sec. 913. Public disclosure of enforcement actions required.
Sec. 914. Agency disapproval of directors and senior executive officers of
certain depository institutions.
Sec. 915. Clarification of NCUA's authority to conduct compliance
investigations.
Sec. 916. Improved administrative hearings and procedures.
Sec. 917. Task force study of delegation of enforcement actions.
Sec. 918. Annual report to Congress.
Sec. 919. Credit union audit requirements.
Sec. 920. Technical amendments relating to administrative and judicial review.
Subtitle B--Termination of Deposit Insurance
Sec. 926. Revision of procedures for termination of FDIC deposit insurance.
Subtitle C--Improving Early Detection of Misconduct and Encouraging Informants
Sec. 931. Information required to be made available to outside auditors.
Sec. 932. Depository institution employee protection remedy.
Sec. 933. Reward for information leading to recoveries or civil penalties.
Subtitle D--Right to Financial Privacy Act Amendments
Sec. 941. Definitions.
Sec. 942. Additional exceptions.
Sec. 943. Prohibition.
Sec. 944. Miscellaneous provisions.
Subtitle E--Civil Penalties for Violations Involving Financial Institutions
Sec. 951. Civil penalties.
Subtitle F--Criminal Law and Procedure
Sec. 961. Increased criminal penalties for certain financial institution
offenses.
Sec. 962. Miscellaneous revisions to title 18.
Sec. 963. Civil and criminal forfeiture.
Sec. 964. Grand jury secrecy.
Sec. 965. Criminal Division Fraud Section regional office.
Sec. 966. Department of Justice appropriation authorization.
Sec. 967. Authorization of additional appropriations for the judiciary.
Sec. 968. Racketeer influenced and corrupt organizations.
TITLE X--STUDIES OF FEDERAL DEPOSIT INSURANCE, BANKING SERVICES, AND THE
SAFETY AND SOUNDNESS OF GOVERNMENT-SPONSORED ENTERPRISES
Sec. 1001. Study of Federal deposit insurance system.
Sec. 1002. Survey of bank fees and services.
Sec. 1003. General Accounting Office study.
Sec. 1004. Study regarding capital requirements for government-sponsored
enterprises.
TITLE XI--REAL ESTATE APPRAISAL REFORM AMENDMENTS
Sec. 1101. Purpose.
Sec. 1102. Establishment of Appraisal Subcommittee of the Federal Financial
Institutions Examination Council.
Sec. 1103. Functions of Appraisal Subcommittee.
Sec. 1104. Chairperson of Appraisal Subcommittee; term of Chairperson;
meetings.
Sec. 1105. Officers and staff.
Sec. 1106. Powers of Appraisal Subcommittee.
Sec. 1107. Procedures for establishing appraisal standards and requiring
the use of certified and licensed appraisers.
Sec. 1108. Startup funding.
Sec. 1109. Roster of State certified or licensed appraisers; authority to
collect and transmit fees.
Sec. 1110. Functions of the Federal financial institutions regulatory agencies
relating to appraisal standards.
Sec. 1111. Time for proposal and adoption of standards.
Sec. 1112. Functions of the Federal financial institutions regulatory agencies
relating to appraiser qualifications.
Sec. 1113. Transactions requiring the services of a State certified appraiser.
Sec. 1114. Transactions requiring the services of a State licensed appraiser.
Sec. 1115. Time for proposal and adoption of rules.
Sec. 1116. Certification and licensing requirements.
Sec. 1117. Establishment of State appraiser certifying and licensing agencies.
Sec. 1118. Monitoring of State appraiser certifying and licensing agencies.
Sec. 1119. Recognition of State certified and licensed appraisers for purposes
of this title.
Sec. 1120. Violations in obtaining and performing appraisals in federally
related transactions.
Sec. 1121. Definitions.
Sec. 1122. Miscellaneous provisions.
TITLE XII--MISCELLANEOUS PROVISIONS
Sec. 1201. GAO study of credit union system.
Sec. 1202. OCC employment provision.
Sec. 1203. NCUA employment provision.
Sec. 1204. Expansion of use of underutilized minority banks, women's banks,
and low-income credit unions.
Sec. 1205. Credit standards advisory committee.
Sec. 1206. Comparability in compensation schedules.
Sec. 1207. Study by Secretary of the Treasury.
Sec. 1208. Expenditure of taxpayer money only for deposit insurance purposes.
Sec. 1209. Amendment to section 5373 of title 5, United States Code.
Sec. 1210. Farm Credit Administration and Farm Credit System Insurance
Corporation employment provision.
Sec. 1211. Fair lending oversight and enforcement.
Sec. 1212. Amendment to the Community Reinvestment Act of 1977.
Sec. 1213. Comptroller General audit and access to records.
Sec. 1214. Amendment related to the Hart-Scott-Rodino Act.
Sec. 1215. Capital and accounting standards.
Sec. 1216. Equal opportunity.
Sec. 1217. NCUA powers as liquidating agent and conservator.
Sec. 1218. Risk management training.
Sec. 1219. Cross-marketing restrictions.
Sec. 1220. Separability of provisions.
TITLE XIII--PARTICIPATION BY STATE HOUSING FINANCE AUTHORITIES AND NONPROFIT
ENTITIES
Sec. 1301. Definitions.
Sec. 1302. Authorization for State housing finance agencies and nonprofit
entities to purchase mortgage-related assets.
TITLE XIV--TAX PROVISIONS
Sec. 1401. Early termination of special reorganization rules for financial
institutions.
Sec. 1402. Tax exemption for Resolution Trust Corporation and Resolution
Funding Corporation.
Sec. 1403. Annual reports on transactions in which Federal financial
assistance provided.
Sec. 1404. Studies of relationship between public debt and activities of
Government-sponsored enterprises.
TITLE I--PURPOSES
SEC. 101. PURPOSES.
 The purposes of this Act are as follows:
 (1) To promote, through regulatory reform, a safe and stable system of
 affordable housing finance.
 (2) To improve the supervision of savings associations by strengthening
 capital, accounting, and other supervisory standards.
 (3) To curtail investments and other activities of savings associations
 that pose unacceptable risks to the Federal deposit insurance funds.
 (4) To promote the independence of the Federal Deposit Insurance Corporation
 from the institutions the deposits of which it insures, by providing an
 independent board of directors, adequate funding, and appropriate powers.
 (5) To put the Federal deposit insurance funds on a sound financial footing.
 (6) To establish an Office of Thrift Supervision in the Department of the
 Treasury, under the general oversight of the Secretary of the Treasury.
 (7) To establish a new corporation, to be known as the Resolution Trust
 Corporation, to contain, manage, and resolve failed savings associations.
 (8) To provide funds from public and private sources to deal expeditiously
 with failed depository institutions.
 (9) To strengthen the enforcement powers of Federal regulators of depository
 institutions.
 (10) To strengthen the civil sanctions and criminal penalties for defrauding
 or otherwise damaging depository institutions and their depositors.
TITLE II--FEDERAL DEPOSIT INSURANCE CORPORATION
SEC. 201. DEPOSITORY INSTITUTIONS.
 (a) AMENDMENTS TO REFERENCES TO INSURED BANK-
 (1) IN GENERAL- Except as provided in paragraph (2), the Federal
 Deposit Insurance Act (12 U.S.C. 1811 et seq.) is amended by striking out
 `insured bank', `insured banks', and `insured bank's' each place each term
 appears in such Act (except where any such term is preceded by `member' or
 `nonmember') and inserting in lieu thereof `insured depository institution',
 `insured depository institutions', and `insured depository institution's',
 respectively.
 (2) EXCEPTIONS- The terms `insured bank' and `insured banks' shall not
 be amended pursuant to paragraph (1) in sections 3(h), 11(h), 11(i),
 13(c)(1)(B), 13(f), and 18(d) of the Federal Deposit Insurance Act.
 (b) AMENDMENTS TO REFERENCES TO FEDERAL HOME LOAN BANK BOARD- The Federal
 Deposit Insurance Act (12 U.S.C. 1811 et seq.) is amended by striking out
 `Federal Home Loan Bank Board' each place such term appears and inserting
 in lieu thereof `Director of the Office of Thrift Supervision'.
SEC. 202. DUTIES OF FEDERAL DEPOSIT INSURANCE CORPORATION.
 Section 1 of the Federal Deposit Insurance Act (12 U.S.C. 1811) is amended
 by inserting `and savings associations' after `banks'.
SEC. 203. FDIC BOARD MEMBERS.
 (a) IN GENERAL- Section 2 of the Federal Deposit Insurance Act is amended
 to read as follows:
`SEC. 2. MANAGEMENT.
 `(a) BOARD OF DIRECTORS-
 `(1) IN GENERAL- The management of the Corporation shall be vested in a
 Board of Directors consisting of 5 members--
 `(A) 1 of whom shall be the Comptroller of the Currency;
 `(B) 1 of whom shall be the Director of the Office of Thrift Supervision; and
 `(C) 3 of whom shall be appointed by the President, by and with the advice
 and consent of the Senate, from among individuals who are citizens of the
 United States.
 `(2) POLITICAL AFFILIATION- After February 28, 1993, not more than 3 of the
 members of the Board of Directors may be members of the same political party.
 `(b) CHAIRPERSON AND VICE CHAIRPERSON-
 `(1) CHAIRPERSON- 1 of the appointed members shall be designated by the
 President, by and with the advice and consent of the Senate, to serve as
 Chairperson of the Board of Directors for a term of 5 years.
 `(2) VICE CHAIRPERSON- 1 of the appointed members shall be designated by
 the President, by and with the advice and consent of the Senate, to serve
 as Vice Chairperson of the Board of Directors.
 `(3) ACTING CHAIRPERSON- In the event of a vacancy in the position of
 Chairperson of the Board of Directors or during the absence or disability
 of the Chairperson, the Vice Chairperson shall act as Chairperson.
 `(c) Terms-
 `(1) APPOINTED MEMBERS- Each appointed member shall be appointed for a term
 of 6 years.
 `(2) INTERIM APPOINTMENTS- Any member appointed to fill a vacancy occurring
 before the expiration of the term for which such member's predecessor was
 appointed shall be appointed only for the remainder of such term.
 `(3) CONTINUATION OF SERVICE- The Chairperson, Vice Chairperson, and each
 appointed member may continue to serve after the expiration of the term
 of office to which such member was appointed until a successor has been
 appointed and qualified.
 `(d) Vacancy-
 `(1) IN GENERAL- Any vacancy on the Board of Directors shall be filled in
 the manner in which the original appointment was made.
 `(2) ACTING OFFICIALS MAY SERVE- In the event of a vacancy in the office of
 the Comptroller of the Currency or the office of Director of the Office of
 Thrift Supervision and pending the appointment of a successor, or during
 the absence or disability of the Comptroller or such Director, the acting
 Comptroller of the Currency or the acting Director of the Office of Thrift
 Supervision, as the case may be, shall be a member of the Board of Directors
 in the place of the Comptroller or Director.
 `(e) INELIGIBILITY FOR OTHER OFFICES-
 `(1) POSTSERVICE RESTRICTION-
 `(A) IN GENERAL- No member of the Board of Directors may hold any office,
 position, or employment in any insured depository institution or any
 depository institution holding company during--
 `(i) the time such member is in office; and
 `(ii) the 2-year period beginning on the date such member ceases to serve
 on the Board of Directors.
 `(B) EXCEPTION FOR MEMBERS WHO SERVE FULL TERM- The limitation contained in
 subparagraph (A)(ii) shall not apply to any member who has ceased to serve
 on the Board of Directors after serving the full term for which such member
 was appointed.
 `(2) RESTRICTION DURING SERVICE- No member of the Board of Directors may--
 `(A) be an officer or director of any insured depository institution,
 depository institution holding company, Federal Reserve bank, or Federal
 home loan bank; or
 `(B) hold stock in any insured depository institution or depository
 institution holding company.
 `(3) CERTIFICATION- Upon taking office, each member of the Board of Directors
 shall certify under oath that such member has complied with this subsection
 and such certification shall be filed with the secretary of the Board
 of Directors.'.
 (b) Transition Provision-
 (1) CHAIRPERSON- Notwithstanding any provision of section 2 of the Federal
 Deposit Insurance Act, the Chairman of the Board of Directors of the Federal
 Deposit Insurance Corporation on the date of the enactment of the Financial
 Institutions Reform, Recovery, and Enforcement Act of 1989 may continue to
 serve as the Chairperson until the end of the term to which such Chairman
 was appointed.
 (2) MEMBERS- Notwithstanding any provision of section 2 of the Federal
 Deposit Insurance Act, the appointed member of the Board of Directors of
 the Federal Deposit Insurance Corporation on the date of the enactment of
 the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 who
 is not the Chairman shall continue to serve in office until the earlier of--
 (A) the end of the term to which such member was appointed; or
 (B) February 28, 1993,
except that such member may continue to serve after the end of such term
until a successor has been appointed and qualified.
 (3) APPOINTMENTS BEFORE MARCH 1, 1993- Notwithstanding any provision of
 section 2 of the Federal Deposit Insurance Act, the term of any member
 appointed to the Board of Directors of the Federal Deposit Insurance
 Corporation before February 28, 1993 (including the term of any Chairperson),
 shall end on such date.
SEC. 204. DEFINITIONS.
 (a) DEFINITIONS OF BANK AND RELATED TERMS- Section 3(a) of the Federal
 Deposit Insurance Act (12 U.S.C. 1813(a)) is amended to read as follows:
 `(a) DEFINITIONS OF BANK AND RELATED TERMS-
 `(1) BANK- The term `bank'--
 `(A) means any national bank, State bank, and District bank, and any Federal
 branch and insured branch;
 `(B) includes any former savings association that--
 `(i) has converted from a savings association charter; and
 `(ii) is a Savings Association Insurance Fund member.
 `(2) STATE BANK- The term `State bank' means any bank, banking association,
 trust company, savings bank, industrial bank (or similar depository
 institution which the Board of Directors finds to be operating substantially
 in the same manner as an industrial bank), or other banking institution
 which--
 `(A) is engaged in the business of receiving deposits, other than trust funds
 (as defined in this section); and
 `(B) is incorporated under the laws of any State or which is operating
 under the Code of Law for the District of Columbia (except a national bank),
including any cooperative bank or other unincorporated bank the deposits
of which were insured by the Corporation on the day before the date of the
enactment of the Financial Institutions Reform, Recovery, and Enforcement
Act of 1989.
 `(3) STATE- The term `State' means any State of the United States, the
 District of Columbia, any territory of the United States, Puerto Rico,
 Guam, American Samoa, the Trust Territory of the Pacific Islands, the Virgin
 Islands, and the Northern Mariana Islands.
 `(4) DISTRICT BANK- The term `District bank' means any State bank operating
 under the Code of Law of the District of Columbia.
 (b) DEFINITION OF SAVINGS ASSOCIATIONS AND RELATED TERMS- Section 3(b) of
 the Federal Deposit Insurance Act (12 U.S.C. 1813(b)) is amended to read
 as follows:
 `(b) DEFINITION OF SAVINGS ASSOCIATIONS AND RELATED TERMS-
 `(1) SAVINGS ASSOCIATION- The term `savings association' means--
 `(A) any Federal savings association;
 `(B) any State savings association; and
 `(C) any corporation (other than a bank) that the Board of Directors and
 the Director of the Office of Thrift Supervision jointly determine to be
 operating in substantially the same manner as a savings association.
 `(2) FEDERAL SAVINGS ASSOCIATION- The term `Federal savings association'
 means any Federal savings association or Federal savings bank which is
 chartered under section 5 of the Home Owners' Loan Act.
 `(3) STATE SAVINGS ASSOCIATION- The term `State savings association' means--
 `(A) any building and loan association, savings and loan association,
 or homestead association; or
 `(B) any cooperative bank (other than a cooperative bank which is a State
 bank as defined in subsection (a)(2)),
which is organized and operating according to the laws of the State (as
defined in subsection (a)(3)) in which it is chartered or organized.'.
 (c) DEFINITIONS RELATING TO DEPOSITORY INSTITUTIONS- Section 3(c) of
 the Federal Deposit Insurance Act (12 U.S.C. 1813(c)) is amended to read
 as follows:
 `(c) DEFINITIONS RELATING TO DEPOSITORY INSTITUTIONS-
 `(1) DEPOSITORY INSTITUTION- The term `depository institution' means any
 bank or savings association.
 `(2) INSURED DEPOSITORY INSTITUTION- The term `insured depository institution'
 means any bank or savings association the deposits of which are insured by
 the Corporation pursuant to this Act.
 `(3) INSTITUTIONS INCLUDED FOR CERTAIN PURPOSES- The term `insured depository
 institution' includes any uninsured branch or agency of a foreign bank
 or a commercial lending company owned or controlled by a foreign bank for
 purposes of section 8 of this Act.
 `(4) FEDERAL DEPOSITORY INSTITUTION- The term `Federal depository institution'
 means any national bank, any Federal savings association, and any Federal
 branch.
 `(5) STATE DEPOSITORY INSTITUTION- The term `State depository institution'
 means any State bank, any State savings association, and any insured branch
 which is not a Federal branch.'.
 (d) DEFINITIONS RELATING TO MEMBER BANKS- Section 3(d) of the Federal
 Deposit Insurance (12 U.S.C. 1813(d)) is amended to read as follows:
 `(d) DEFINITIONS RELATING TO MEMBER BANKS-
 `(1) NATIONAL MEMBER BANK- The term `national member bank' means any national
 bank which is a member of the Federal Reserve System.
 `(2) STATE MEMBER BANK- The term `State member bank' means any State bank
 which is a member of the Federal Reserve System.'.
 (e) DEFINITIONS RELATING TO NONMEMBER BANKS- Section 3(e) of the Federal
 Deposit Insurance Act (12 U.S.C. 1813(e)) is amended to read as follows:
 `(e) DEFINITIONS RELATING TO NONMEMBER BANKS-
 `(1) NATIONAL NONMEMBER BANK- The term `national nonmember bank' means any
 national bank which--
 `(A) is located in any territory of the United States, Puerto Rico, Guam,
 American Samoa, the Virgin Islands, or the Northern Mariana Islands; and
 `(B) is not a member of the Federal Reserve System.
 `(2) STATE NONMEMBER BANK- The term `State nonmember bank' means any State
 bank which is not a member of the Federal Reserve System.'.
 (f) ADDITIONAL AMENDMENTS TO DEFINITIONS- Section 3 of the Federal Deposit
 Insurance Act (12 U.S.C. 1813) is amended--
 (1) in subsection (j), by inserting `or savings association' after `of
 a bank';
 (2) in subsection (l)--
 (A) by inserting `or savings association' after `a bank', `the bank', `another
 bank', `receiving bank', and `such bank' each place such terms appear;
 (B) by inserting `or savings association's' after the word `bank's' each
 place such term appears;
 (C) in paragraph (5), by inserting `, Director of the Office of Thrift
 Supervision,' after `Comptroller of the Currency'; and
 (D) in paragraph (5)(A), by striking out `and the Virgin Islands' and
 inserting in lieu thereof `the Virgin Islands, and the Northern Mariana
 Islands';
 (3) in subsection (m)--
 (A) in paragraph (1)--
 (i) by striking out `the bank' and inserting in lieu thereof `the depository
 institution'; and
 (ii) by inserting `of the Northern Mariana Islands,' after `Virgin Islands,';
 and
 (B) in paragraph (2), by striking out `ther' and inserting in lieu thereof
 `term';
 (4) by striking out subsection (q) and inserting in lieu thereof the
 following:
 `(q) APPROPRIATE FEDERAL BANKING AGENCY- The term `appropriate Federal
 banking agency' means--
 `(1) the Comptroller of the Currency, in the case of any national banking
 association, any District bank, or any Federal branch or agency of a
 foreign bank;
 `(2) the Board of Governors of the Federal Reserve System, in the case of--
 `(A) any State member insured bank (except a District bank),
 `(B) any branch or agency of a foreign bank with respect to any provision
 of the Federal Reserve Act which is made applicable under the International
 Banking Act of 1978,
 `(C) any foreign bank which does not operate an insured branch,
 `(D) any agency or commercial lending company other than a Federal agency,
 `(E) supervisory or regulatory proceedings arising from the authority given
 to the Board of Governors under section 7(c)(1) of the International Banking
 Act of 1978, including such proceedings under the Depository Institutions
 Supervisory Act, and
 `(F) any bank holding company and any subsidiary of a bank holding company
 (other than a bank);
 `(3) the Federal Deposit Insurance Corporation in the case of a State
 nonmember insured bank (except a District bank), or a foreign bank having
 an insured branch; and
 `(4) the Director of the Office of Thrift Supervision in the case of any
 savings association or any savings and loan holding company.
Under the rule set forth in this subsection, more than one agency may be an
appropriate Federal banking agency with respect to any given institution.'; and
 (5) by striking out subsection (t) and inserting in lieu thereof the
 following new subsection:
 `(t) INCLUDES, INCLUDING-
 `(1) IN GENERAL- The terms `includes' and `including' shall not be construed
 more restrictively than the ordinary usage of such terms so as to exclude
 any other thing not referred to or described.
 `(2) RULE OF CONSTRUCTION- Paragraph (1) shall not be construed as creating
 any inference that the term `includes' or `including' in any other provision
 of Federal law may be deemed to exclude any other thing not referred to
 or described.';
 (6) by adding at the end thereof the following new subsections:
 `(u) INSTITUTION-AFFILIATED PARTY- The term `institution-affiliated party'
 means--
 `(1) any director, officer, employee, or controlling stockholder (other than
 a bank holding company) of, or agent for, an insured depository institution;
 `(2) any other person who has filed or is required to file a change-in-control
 notice with the appropriate Federal banking agency under section 7(j);
 `(3) any shareholder (other than a bank holding company), consultant, joint
 venture partner, and any other person 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) who knowingly or recklessly participates in--
 `(A) any violation of any law or regulation;
 `(B) any breach of fiduciary duty; or
 `(C) any unsafe or unsound practice,
which caused or is likely to cause more than a minimal financial loss to,
or a significant adverse effect on, the insured depository institution.
 `(v) VIOLATION- The term `violation' includes any action (alone or with
 another or others) for or toward causing, bringing about, participating in,
 counseling, or aiding or abetting a violation.
 `(w) DEFINITIONS RELATING TO HOLDING COMPANIES-
 `(1) DEPOSITORY INSTITUTION HOLDING COMPANY- The term `depository institution
 holding company' means a bank holding company or a savings and loan holding
 company.
 `(2) BANK HOLDING COMPANY- The term `bank holding company' has the meaning
 given to such term in section 2 of the Bank Holding Company Act of 1956.
 `(3) SAVINGS AND LOAN HOLDING COMPANY- The term `savings and loan holding
 company' has the meaning given to such term in section 10 of the Home Owners'
 Loan Act.
 `(4) SUBSIDIARY- The term `subsidiary'--
 `(A) means any company which is owned or controlled directly or indirectly
 by another company; and
 `(B) includes any service corporation owned in whole or in part by an insured
 depository institution or any subsidiary of such a service corporation.
 `(5) CONTROL- The term `control' has the meaning given to such term in
 section 2 of the Bank Holding Company Act of 1956.
 `(6) AFFILIATE- The term `affiliate' has the meaning given to such term in
 section 2(k) of the Bank Holding Company Act of 1956.
 `(x) DEFINITIONS RELATING TO DEFAULT-
 `(1) DEFAULT- The term `default' means, with respect to an insured depository
 institution, any adjudication or other official determination by any court
 of competent jurisdiction, the appropriate Federal banking agency, or other
 public authority pursuant to which a conservator, receiver, or other legal
 custodian is appointed for an insured depository institution or, in the
 case of a foreign bank having an insured branch, for such branch.
 `(2) IN DANGER OF DEFAULT- The term `in danger of default' means an
 insured depository institution with respect to which (or in the case of a
 foreign bank having an insured branch, with respect to such insured branch)
 the appropriate Federal banking agency or State chartering authority has
 advised the Corporation (or, if the appropriate Federal banking agency is
 the Corporation, the Corporation has determined) that--
 `(A) in the opinion of such agency or authority--
 `(i) the depository institution or insured branch is not likely to be able
 to meet the demands of the institution's or branch's depositors or pay the
 institution's or branch's obligations in the normal course of business; and
 `(ii) there is no reasonable prospect that the depository institution or
 insured branch will be able to meet such demands or pay such obligations
 without Federal assistance; or
 `(B) in the opinion of such agency or authority--
 `(i) the depository institution or insured branch has incurred or is likely
 to incur losses that will deplete all or substantially all of its capital; and
 `(ii) there is no reasonable prospect that the capital of the depository
 institution or insured branch will be replenished without Federal
 assistance.'.
SEC. 205. INSURED SAVINGS ASSOCIATIONS.
 Section 4 of the Federal Deposit Insurance Act (12 U.S.C. 1814) is amended--
 (1) in subsection (a)--
 (A) by striking out `(a) Every bank' and inserting in lieu thereof the
 following:
 `(a) CONTINUATION OF INSURANCE-
 `(1) BANKS- Each bank'; and
 (B) by adding at the end thereof the following new paragraph:
 `(2) SAVINGS ASSOCIATIONS- Each savings association the accounts of which
 were insured by the Federal Savings and Loan Insurance Corporation on the
 day before the date of the enactment of the Financial Institutions Reform,
 Recovery, and Enforcement Act of 1989, shall be, without application or
 approval, an insured depository institution.';
 (2) in subsection (b)--
 (A) by inserting after the 1st sentence the following new sentences:
 `Any application or notice for membership or to commence or resume business
 shall be promptly provided by the appropriate Federal banking agency to the
 Corporation and the Corporation shall have a reasonable period of time to
 provide comments on such application or notice. Any comments submitted by
 the Corporation to the appropriate Federal banking agency shall be considered
 by such agency.';
 (B) by striking out the penultimate and the last sentences; and
 (C) by striking out `(b) Every national bank' and inserting in lieu thereof
 `(b) CERTIFICATION BY OTHER BANKING AGENCIES- Every national bank'; and
 (3) by striking out subsection (c) and inserting in lieu thereof the
 following new subsections:
 `(c) CONTINUATION OF INSURANCE AFTER CONVERSION- Subject to section 5(d)--
 `(1) any State depository institution which results from the conversion of
 any insured Federal depository institution; and
 `(2) any Federal depository institution which results from the conversion
 of any insured State depository institution,
shall continue as an insured depository institution.
 `(d) CONTINUATION OF INSURANCE AFTER MERGER OR CONSOLIDATION- Any State
 depository institution or any Federal depository institution which results
 from the merger or consolidation of insured depository institutions, or
 from the merger or consolidation of a noninsured depository institution with
 an insured depository institution, shall continue as an insured depository
 institution.'.
SEC. 206. APPLICATION PROCESS; INSURANCE FEES.
 (a) IN GENERAL- Section 5 of the Federal Deposit Insurance Act (12
 U.S.C. 1815) is amended--
 (1) by striking out `(a) Subject to the provisions of this Act, any' and
 inserting in lieu thereof the following:
 `(a) APPLICATION FOR INSURANCE-
 `(1) NATIONAL AND STATE NONMEMBER BANKS; STATE SAVINGS ASSOCIATIONS- Any';
 (2) in the 1st sentence of subsection (a)(1) (as so redesignated by paragraph
 (1) of this subsection), by striking out the comma after `State nonmember
 bank' and inserting in lieu thereof `and State savings association,'; and
 (3) in the 2nd sentence of subsection (a)(1) (as so redesignated by paragraph
 (1) of this subsection)--
 (A) by striking out the comma after `State nonmember bank' and inserting
 in lieu thereof `and State savings association,';
 (B) by striking out the comma after `such bank' and inserting in lieu thereof
 `or savings association,'; and
 (C) by inserting `or savings association, and, in the case of an application
 by a State savings association, the Corporation shall notify the Director
 of the Office of Thrift Supervision of the Corporation's approval of such
 application' before the period at the end;
 (4) by adding at the end of subsection (a) the following new paragraphs:
 `(2) FEDERAL SAVINGS ASSOCIATIONS- Any Federal savings association shall
 become an insured depository institution upon--
 `(A) application to the Corporation; and
 `(B) receipt by the Corporation of a certificate issued to the Corporation
 by the Director which meets the requirements of paragraph (4),
unless insurance is denied by the Board of Directors.
 `(3) INTERIM FEDERAL SAVINGS ASSOCIATIONS- In the case of any interim Federal
 savings association which is chartered by the Director of the Office of
 Thrift Supervision and will not open for business, such association shall
 be an insured depository institution upon the issuance of such association's
 charter by the Director.
 `(4) CERTIFICATE REQUIREMENTS- Any certificate issued to the Corporation under
 paragraph (2) shall state that the Federal savings association is authorized
 to transact business as a savings association and that consideration has
 been given to the factors enumerated in section 6.
 `(5) REVIEW REQUIREMENTS- In reviewing any certificate and application
 referred to in paragraph (2), the Board of Directors shall consider the
 factors described in paragraphs (1), (2), (3), (4), and (5) of section 6
 in determining whether to deny insurance.
 `(6) NOTICE OF DENIAL OF APPLICATION- If the Board of Directors, after
 giving due deference to the determination of the Director of the Office
 of Thrift Supervision with respect to such factors, does not concur in the
 determination of the Director, the Board of Directors shall promptly notify
 the Director that insurance has been denied, giving specific reasons in
 writing for the Corporation's determination with reference to the factors
 described in paragraphs (1), (2), (3), (4), and (5) of section 6, and no
 insurance shall be granted.
 `(7) VOTING REQUIREMENTS- The authority of the Board of Directors to
 make any determination to deny insurance under this subsection may not
 be delegated by the Board of Directors and any such determination may be
 made only upon a vote of  3/4  of all members of the Board of Directors
 (excluding the Director of the Office of Thrift Supervision).';
 (5) in subsection (b)(4), by inserting `and fitness' after character;
 (6) in subsection (b)--
 (A) by redesignating paragraphs (5), (6), and (7) as paragraphs (6), (7),
 and (8), respectively; and
 (B) by inserting after paragraph (4) the following:
 `(5) the risk presented to the Bank Insurance Fund or the Savings Association
 Insurance Fund;'; and
 (7) by adding at the end thereof the following new subsections:
 `(d) Insurance Fees-
 `(1) Uninsured institutions-
 `(A) IN GENERAL- Any institution that becomes insured by the Corporation,
 and any noninsured branch that becomes insured by the Corporation, shall pay
 the Corporation any fee which the Corporation may by regulation prescribe,
 after giving due consideration to the need to establish and maintain reserve
 ratios in the Bank Insurance Fund and the Savings Association Insurance
 Fund as required by section 7.
 `(B) FEE CREDITED TO APPROPRIATE FUND- The fee paid by the depository
 institution shall be credited to the Bank Insurance Fund if the depository
 institution becomes a Bank Insurance Fund member, and to the Savings
 Association Insurance Fund if the depository institution becomes a Savings
 Association Insurance Fund member.
 `(C) EXCEPTION FOR CERTAIN DEPOSITORY INSTITUTIONS- Any depository institution
 that becomes an insured depository institution by operation of section 4(a)
 shall not pay any fee.
 `(2) Conversions-
 `(A) IN GENERAL-
 `(i) PRIOR APPROVAL REQUIRED- No insured depository institution may
 participate in a conversion transaction without the prior approval of
 the Corporation.
 `(ii) 5-YEAR MORATORIUM ON CONVERSIONS- Except as provided in subparagraph
 (C), the Corporation may not approve any conversion transaction before
 the end of the 5-year period beginning on the date of the enactment of the
 Financial Institutions Reform, Recovery, and Enforcement Act of 1989.
 `(B) CONVERSION DEFINED- For purposes of this paragraph, the term `conversion
 transaction' means--
 `(i) the change of status of an insured depository institution from a Bank
 Insurance Fund member to a Savings Association Insurance Fund member or from
 a Savings Association Insurance Fund member to a Bank Insurance Fund member;
 `(ii) the merger or consolidation of a Bank Insurance Fund member with a
 Savings Association Insurance Fund member;
 `(iii) the assumption of any liability by--
 `(I) any Bank Insurance Fund member to pay any deposits of a Savings
 Association Insurance Fund member; or
 `(II) any Savings Association Insurance Fund member to pay any deposits of
 a Bank Insurance Fund member;
 `(iv) the transfer of assets of--
 `(I) any Bank Insurance Fund member to any Savings Association Insurance
 Fund member in consideration of the assumption of liabilities for any
 portion of the deposits of such Bank Insurance Fund member; or
 `(II) any Savings Association Insurance Fund member to any Bank Insurance
 Fund member in consideration of the assumption of liabilities for any
 portion of the deposits of such Savings Association Insurance Fund member.
 `(C) APPROVAL DURING MORATORIUM- The Corporation may approve a conversion
 transaction at any time if--
 `(i) the conversion transaction affects an insubstantial portion, as
 determined by the Corporation, of the total deposits of each depository
 institution participating in the conversion transaction;
 `(ii) the conversion occurs in connection with the acquisition of a Savings
 Association Insurance Fund member in default or in danger of default, and
 the Corporation determines that the estimated financial benefits to the
 Savings Association Insurance Fund or Resolution Trust Corporation equal
 or exceed the Corporation's estimate of loss of assessment income to such
 insurance fund over the remaining balance of the 5-year period referred to
 in subparagraph (A), and the Resolution Trust Corporation concurs in the
 Corporation's determination; or
 `(iii) the conversion occurs in connection with the acquisition of a
 Bank Insurance Fund member in default or in danger of default and the
 Corporation determines that the estimated financial benefits to the Bank
 Insurance Fund equal or exceed the Corporation's estimate of the loss of
 assessment income to the insurance fund over the remaining balance of the
 5-year period referred to in subparagraph (A).
 `(D) CERTAIN TRANSFERS DEEMED TO AFFECT INSUBSTANTIAL PORTION OF TOTAL
 DEPOSITS- For purposes of subparagraph (C)(i), any conversion transaction
 shall be deemed to affect an insubstantial portion of the total deposits of
 an insured depository institution, to the extent the aggregate amount of
 the total deposits transferred in such transaction and in all conversion
 transactions occurring after the date of the enactment of the Financial
 Institutions Reform, Recovery, and Enforcement Act of 1989 does not exceed
 35 percent of the lesser of--
 `(i) the amount which is equal to the sum of--
 `(I) the total deposits of such insured depository institution on May 1,
 1989; and
 `(II) the total amount of net interest credited to the depository
 institution's deposits during the period beginning on May 1, 1989, and
 ending on the date of the transfer of deposits in connection with such
 transaction; or
 `(ii) the amount which is equal to the total deposits of such insured
 depository institution on the date of the transfer of deposits in connection
 with such transaction.
 `(E) EXIT AND ENTRANCE FEES- Each insured depository institution participating
 in a conversion transaction shall pay--
 `(i) in the case of a conversion transaction in which the resulting or
 acquiring depository institution is not a Savings Association Insurance
 Fund member, an exit fee (in an amount to be determined and assessed in
 accordance with subparagraph (F)) which--
 `(I) shall be deposited in the Savings Association Insurance Fund; or
 `(II) shall be paid to the Financing Corporation, if the Secretary of the
 Treasury determines that the Financing Corporation has exhausted all other
 sources of funding for interest payments on the obligations of the Financing
 Corporation and orders that such fees be paid to the Financing Corporation;
 `(ii) in the case of a conversion transaction in which the resulting or
 acquiring depository institution is not a Bank Insurance Fund member, an
 exit fee in an amount to be determined by the Corporation (and assessed in
 accordance with subparagraph (F)(ii)) which shall be deposited in the Bank
 Insurance Fund; and
 `(iii) an entrance fee in an amount to be determined by the Corporation
 (and assessed in accordance with subparagraph (F)(ii)), except that--
 `(I) in the case of a conversion transaction in which the resulting or
 acquiring depository institution is a Bank Insurance Fund member, the
 fee shall be the approximate amount which the Corporation calculates as
 necessary to prevent dilution of the Bank Insurance Fund, and shall be paid
 to the Bank Insurance Fund; and
 `(II) in the case of a conversion transaction in which the resulting or
 acquiring depository institution is a Savings Association Insurance Fund
 member, the fee shall be the approximate amount which the Corporation
 calculates as necessary to prevent dilution of the Savings Association
 Insurance Fund, and shall be paid to the Savings Association Insurance Fund.
 `(F) ASSESSMENT OF EXIT AND ENTRANCE FEES-
 `(i) DETERMINATION OF AMOUNT OF EXIT FEES-
 `(I) CONVERSIONS BEFORE JANUARY 1, 1997- In the case of any exit fee assessed
 under subparagraph (E)(i) for any conversion transaction consummated before
 January 1, 1997, the amount of such fee shall be determined jointly by the
 Corporation and the Secretary of the Treasury.
 `(II) ASSESSMENTS AFTER DECEMBER, 31, 1996- In the case of any exit fee
 assessed under subparagraph (E)(i) for any conversion transaction consummated
 after December 31, 1996, the amount of such fee shall be determined by
 the Corporation.
 `(ii) PROCEDURES- The Corporation shall prescribe, by regulation, procedures
 for assessing any exit or entrance fee under subparagraph (E).
 `(G) CHARTER CONVERSION OF SAIF MEMBERS- This subsection shall not
 be construed as prohibiting any savings association which is a Savings
 Association Insurance Fund member from converting to a bank charter during
 the period described in subparagraph (A)(ii) if the resulting bank remains
 a Savings Association Insurance Fund member.
 `(3) OPTIONAL CONVERSION THROUGH MERGER-
 `(A) IN GENERAL- Notwithstanding paragraph (2)(A), any bank holding company
 that controls any savings association may merge or consolidate the assets
 and liabilities of such savings association with, or transfer such assets
 and liabilities to, any subsidiary bank which is a Bank Insurance Fund
 member with the approval of the appropriate Federal banking agency and the
 Board of Governors of the Federal Reserve System.
 `(B) ASSESSMENTS BY SAIF ON DEPOSITS ATTRIBUTABLE TO FORMER SAVINGS
 ASSOCIATION- That portion of the average assessment base of any subsidiary
 bank referred to in subparagraph (A) for any semiannual period which is equal
 to the adjusted attributable deposit amount (determined under subparagraph
 (C) with respect to the transaction described in subparagraph (A)) shall--
 `(i) be subject to assessment at the assessment rate applicable under
 section 7 for Savings Association Insurance Fund members;
 `(ii) shall not be taken into account for purposes of any assessment under
 section 7 for Bank Insurance Fund members; and
 `(iii) shall be treated as deposits which are insured by the Savings
 Association Insurance Fund.
 `(C) DETERMINATION OF ADJUSTED ATTRIBUTABLE DEPOSIT AMOUNT- The adjusted
 attributable deposit amount which shall be taken into account by any bank
 subsidiary referred to in subparagraph (A) for purposes of determining the
 amount of the assessment under subparagraph (B)(i) for any semiannual period
 is the amount which is equal to the sum of--
 `(i) the amount of any deposits acquired by such bank subsidiary in connection
 with any transaction described in subparagraph (A) (as determined at the
 time of such transaction);
 `(ii) the total of the amounts determined under clause (iii) for semiannual
 periods preceding the semiannual period for which the determination is
 being made under this subparagraph; and
 `(iii) the amount by which the sum of the amounts described in clauses (i)
 and (ii) would have increased during the preceding semiannual period (other
 than any semiannual period beginning before the date of such transaction)
 if such increase occurred at a rate equal to the greater of--
 `(I) an annual rate of 7 percent; or
 `(II) the annual rate of growth of deposits of such subsidiary bank minus
 the amount of any deposits acquired through the acquisition, in whole or
 in part, of a Bank Insurance Fund member during such semiannual period.
 `(D) DEPOSIT OF ASSESSMENT- The amount of the assessment referred to in
 subparagraph (B)(i) shall be deposited in the Savings Association Insurance
 Fund.
 `(E) CONDITIONS FOR FEDERAL RESERVE BOARD APPROVAL- The Board of Governors
 of the Federal Reserve System may not approve any application by any bank
 holding company to engage in any transaction described in subparagraph (A)
 unless such Board determines that--
 `(i) the amount which is equal to the aggregate amount of the total assets
 of all depository institution subsidiaries of such bank holding company is
 not less than the amount which is equal to 200 percent of the total assets
 of the savings association (at the time of the proposed transaction);
 `(ii) the bank holding company and all bank subsidiaries of such holding
 company will meet all applicable capital standards upon consummation of
 the proposed transaction;
 `(iii) the transaction is not in substance the acquisition of any Bank
 Insurance Fund member bank by any Savings Association Insurance Fund member;
 `(iv) in the case of any transaction which occurs--
 `(I) during the 1-year period beginning on the date of the enactment of
 the Financial Institutions Reform, Recovery, and Enforcement Act of 1989,
 the savings association had tangible capital of less than 4 percent during
 the preceding quarter; and
 `(II) during the 1-year period beginning after the end of the 1-year period
 referred to in subclause (I), the savings association had tangible capital
 of less than 5 percent during the preceding quarter; and
 `(v) the transaction would comply with the requirements of section 3(d) of
 the Bank Holding Company Act of 1956 if, at the time of such transaction,
 the savings association were a State bank which the bank holding company
 was applying to acquire.
 `(F) ALLOCATION OF COSTS IN EVENT OF DEFAULT- If any subsidiary bank referred
 to in subparagraph (A) 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 bank subsidiary (other than the adjusted attributable deposit amount)
 which is insured by the Bank Insurance Fund and the adjusted attributable
 deposit amount which is insured by the Savings Association Insurance Fund
 pursuant to subparagraph (B)(iii).
 `(G) SUBSEQUENT APPROVAL OF CONVERSION TRANSACTION- This paragraph shall
 cease to apply if--
 `(i) after the end of the 5-year period referred to in paragraph (2)(A), the
 Corporation approves an application by the bank described in subparagraph
 (A) to treat the transaction described in subparagraph (A) as a conversion
 transaction; and
 `(ii) such bank pays the amount of any exit and entrance fee assessed by
 the Corporation under paragraph (2)(E) with respect to such transaction.
 `(e) LIABILITY OF COMMONLY CONTROLLED DEPOSITORY INSTITUTIONS-
 `(1) IN GENERAL-
 `(A) LIABILITY ESTABLISHED- Any insured depository institution shall be liable
 for any loss incurred by the Corporation, or any loss which the Corporation
 reasonably anticipates incurring, after the date of the enactment of the
 Financial Institutions Reform, Recovery, and Enforcement Act of 1989 in
 connection with--
 `(i) the default of a commonly controlled insured depository institution; or
 `(ii) any assistance provided by the Corporation to any commonly controlled
 insured depository institution in danger of default.
 `(B) PAYMENT UPON NOTICE- An insured depository institution shall pay the
 amount of any liability to the Corporation under subparagraph (A) upon receipt
 of written notice by the Corporation in accordance with this subsection.
 `(C) NOTICE REQUIRED TO BE PROVIDED WITHIN 2 YEARS OF LOSS- No insured
 depository institution shall be liable to the Corporation under subparagraph
 (A) if written notice with respect to such liability is not received by
 such institution before the end of the 2-year period beginning on the date
 the Corporation incurred the loss.
 `(2) Amount of compensation; procedures-
 `(A) USE OF ESTIMATES- When an insured depository institution is in default
 or requires assistance to prevent default, the Corporation shall--
 `(i) in good faith, estimate the amount of the loss the Corporation will
 incur from such default or assistance;
 `(ii) if, with respect to such insured depository institution, there is
 more than 1 commonly controlled insured depository institution, estimate
 the amount of each such commonly controlled depository institution's share
 of such liability; and
 `(iii) advise each commonly controlled depository institution of the
 Corporation's estimate of the amount of such institution's liability for
 such losses.
 `(B) PROCEDURES; IMMEDIATE PAYMENT- The Corporation, after consultation with
 the appropriate Federal banking agency and the appropriate State chartering
 agency, shall--
 `(i) on a case-by-case basis, establish the procedures and schedule under
 which any insured depository institution shall reimburse the Corporation
 for such institution's liability under paragraph (1) in connection with
 any commonly controlled insured depository institution; or
 `(ii) require any insured depository institution to make immediate payment of
 the amount of such institution's liability under paragraph (1) in connection
 with any commonly controlled insured depository institution.
 `(C) PRIORITY- The liability of any insured depository institution under
 this subsection shall have priority with respect to other obligations and
 liabilities as follows:
 `(i) SUPERIORITY- The liability shall be superior to the following obligations
 and liabilities of the depository institution:
 `(I) Any obligation to shareholders arising as a result of their status as
 shareholders (including any depository institution holding company or any
 shareholder or creditor of such company).
 `(II) Any obligation or liability owed to any affiliate of the depository
 institution (including any other insured depository institution), other
 than any secured obligation which was secured as of May 1, 1989.
 `(ii) SUBORDINATION- The liability shall be subordinate in right and payment
 to the following obligations and liabilities of the depository institution:
 `(I) Any deposit liability (which is not a liability described in clause
 (i)(II)).
 `(II) Any secured obligation, other than any obligation owed to any
 affiliate of the depository institution (including any other insured
 depository institution) which was secured after May 1, 1989.
 `(III) Any other general or senior liability (which is not a liability
 described in clause (i)).
 `(IV) Any obligation subordinated to depositors or other general creditors
 (which is not an obligation described in clause (i)).
 `(D) ADJUSTMENT OF ESTIMATED PAYMENT-
 `(i) OVERPAYMENT- If the amount of compensation estimated by and paid to the
 Corporation by 1 or more such commonly controlled depository institutions is
 greater than the actual loss incurred by the Corporation, the Corporation
 shall reimburse each such commonly controlled depository institution its
 pro rata share of any overpayment.
 `(ii) UNDERPAYMENT- If the amount of compensation estimated by and paid to
 the Corporation by 1 or more such commonly controlled depository institutions
 is less than the actual loss incurred by the Corporation, the Corporation
 shall redetermine in its discretion the liability of each such commonly
 controlled depository institution to the Corporation and shall require
 each such commonly controlled depository institution to make payment of
 any additional liability to the Corporation.
 `(3) REVIEW-
 `(A) JUDICIAL- Actions of the Corporation shall be reviewable pursuant to
 chapter 7 of title 5, United States Code.
 `(B) ADMINISTRATIVE- The Corporation shall prescribe regulations and
 establish administrative procedures which provide for a hearing on the
 record for the review of--
 `(i) the amount of any loss incurred by the Corporation in connection with
 any insured depository institution;
 `(ii) the liability of individual commonly controlled depository institutions
 for the amount of such loss; and
 `(iii) the schedule of payments to be made by such commonly controlled
 depository institutions.
 `(4) LIMITATION ON RIGHTS OF PRIVATE PARTIES- To the extent the exercise of
 any right or power of any person would impair the ability of any insured
 depository institution to perform such institution's obligations under
 this subsection--
 `(i) the obligations of such insured depository institution shall supersede
 such right or power; and
 `(ii) no court may give effect to such right or power with respect to such
 insured depository institution.
 `(5) WAIVER AUTHORITY-
 `(A) IN GENERAL- The Corporation, in its discretion, may exempt any
 insured depository institution from the provisions of this subsection if
 the Corporation determines that such exemption is in the best interests of
 the Bank Insurance Fund or the Savings Association Insurance Fund.
 `(B) CONDITION- During the period any exemption granted to any insured
 depository institution under subparagraph (A) or (C) is in effect, such
 insured depository institution and all other insured depository institution
 affiliates of such depository institution shall comply fully with the
 restrictions of sections 23A and 23B of the Federal Reserve Act without
 regard to section 23A(d)(1).
 `(C) LIMITED PARTNERSHIPS-
 `(i) IN GENERAL- The Corporation may, in its discretion, exempt any limited
 partnership and any affiliate of any limited partnership (other than any
 insured depository institution which is a majority owned subsidiary of
 such partnership) from the provisions of this subsection if such limited
 partnership or affiliate has filed a registration statement with the
 Securities and Exchange Commission on or before April 10, 1989, indicating
 that as of the date of such filing such partnership intended to acquire 1
 or more insured depository institutions.
 `(ii) REVIEW AND NOTICE- Within 10 business days after the date of submission
 of any request for an exemption under this subparagraph together with
 such information as shall be reasonably requested by the Corporation, the
 Corporation shall make a determination on the request and shall so advise
 the applicant.
 `(6) 5-YEAR TRANSITION RULE- During the 5-year period beginning on the
 date of the enactment of the Financial Institutions Reform, Recovery,
 and Enforcement Act of 1989--
 `(A) no Savings Association Insurance Fund member shall have any liability to
 the Corporation under this subsection arising out of assistance provided by
 the Corporation or any loss incurred by the Corporation as a result of the
 default of a Bank Insurance Fund member which was acquired by such Savings
 Association Insurance Fund member or any affiliate of such member before
 the date of the enactment of such Act; and
 `(B) no Bank Insurance Fund member shall have such liability with respect
 to assistance provided by or loss incurred by the Corporation as a result
 of the default of a Savings Association Insurance Fund member which was
 acquired by such Bank Insurance Fund member or any affiliate of such member
 before the date of the enactment of such Act.
 `(7) EXCLUSION FOR INSTITUTIONS ACQUIRED IN DEBT COLLECTIONS- Any depository
 institution shall not be treated as commonly controlled, for purposes of this
 subsection, during the 5-year period beginning on the date of an acquisition
 described in subparagraph (A) or such longer period as the Corporation  may
 determine after written application by the acquirer, if--
 `(A) 1 depository institution controls another by virtue of ownership of
 voting shares acquired in securing or collecting a debt previously contracted
 in good faith; and
 `(B) during the period beginning on the date of the enactment of the Financial
 Institutions Reform, Recovery, and Enforcement Act of 1989 and ending upon
 the expiration of the exclusion, the controlling bank and all other insured
 depository institution affiliates of such controlling bank comply fully
 with the restrictions of sections 23A and 23B of the Federal Reserve Act,
 without regard to section 23A(d)(1) of such Act, in transactions with the
 acquired insured depository institution.
 `(8) EXCEPTION FOR CERTAIN FSLIC ASSISTED INSTITUTIONS- No depository
 institution shall have any liability to the Corporation under this subsection
 as the result of the default of, or assistance provided with respect to,
 an insured depository institution which is an affiliate of such depository
 institution if--
 `(A) such affiliate was receiving cash payments from the Federal Savings
 and Loan Insurance Corporation under an assistance agreement or note entered
 into before the date of the enactment of the Financial Institutions Reform,
 Recovery, and Enforcement Act of 1989;
 `(B) the Federal Savings and Loan Insurance Corporation, or such other
 entity which has succeeded to the payment obligations of such Corporation
 with respect to such assistance agreement or note, is unable to continue
 such payments; and
 `(C) such affiliate--
 `(i) is in default or in need of assistance solely as a result of the
 failure to meet the payment obligations referred to in subparagraph (B); and
 `(ii) is not otherwise in breach of the terms of any assistance agreement or
 note which would authorize the Federal Savings and Loan Insurance Corporation
 or such other successor entity, pursuant to the terms of such assistance
 agreement or note, to refuse to make such payments.
 `(9) COMMONLY CONTROLLED DEFINED- For purposes of this subsection, depository
 institutions are commonly controlled if--
 `(A) such institutions are controlled by the same depository institution
 holding company (including any company required to file reports pursuant
 to section 4(f)(6) of the Bank Holding Company Act of 1956); or
 `(B) 1 depository institution is controlled by another depository
 institution.'.
 (b) NEWLY INSURED THRIFT PROVISION- Any insured depository institution
 (as defined in section 3(c)(2) of the Federal Deposit Insurance Act, as
 added by section 204(c) of this Act)--
 (1) which was an insured institution (as defined in section 401(a) of the
 National Housing Act, as in effect before the date of the enactment of this
 Act) on the day before the date of the enactment of this Act;
 (2) the board of directors of which determined, before April 1, 1987,
 to terminate such association's status as an insured institution (as so
 defined) as evidenced in sworn minutes of the board of directors meeting
 held before such date;
 (3) had insured deposits of less than $11,000,000 on April 1, 1987; and
 (4) was an insured institution (as so defined) for less than 1 year as of
 April 1, 1987,
may cease to be a Savings Association Insurance Fund member and become a Bank
Insurance Fund member at any time during the 2-year period beginning on the
date of the enactment of this Act without the approval of the Federal Deposit
Insurance Corporation under section 5(d)(2) of the Federal Deposit Insurance
Act (as added by subsection (a) of this section) and without incurring any
liability for any exit or entrance fee imposed under such section 5(d)(2).
SEC. 207. INSURABILITY FACTORS.
 Section 6 of the Federal Deposit Insurance Act (12 U.S.C. 1816) is amended
 to read as follows:
`SEC. 6. FACTORS TO BE CONSIDERED.
 `The factors that are required, under section 4, to be considered in
 connection with, and enumerated in, any certificate issued pursuant to
 section 4 and that are required, under section 5, to be considered by
 the Board of Directors in connection with any determination by such Board
 pursuant to section 5 are the following:
 `(1) The financial history and condition of the depository institution.
 `(2) The adequacy of the depository institution's capital structure.
 `(3) The future earnings prospects of the depository institution.
 `(4) The general character and fitness of the management of the depository
 institution.
 `(5) The risk presented by such depository institution to the Bank Insurance
 Fund or the Savings Association Insurance Fund.
 `(6) The convenience and needs of the community to be served by such
 depository institution.
 `(7) Whether the depository institution's corporate powers are consistent
 with the purposes of this Act.'.
SEC. 208. ASSESSMENTS.
 Section 7 of the Federal Deposit Insurance Act (12 U.S.C. 1817) is amended--
 (1) in subsection (a)(2)--
 (A) by inserting `, the Director of the Office of Thrift Supervision,
 the Federal Housing Finance Board, any  Federal home loan bank,' after
 `Comptroller of the  Currency' each place such term appears (except after
 `Comptroller of the Currency,');
 (B) by inserting `the Director of the Office of Thrift Supervision,
 the Federal Housing Finance Board, any Federal home loan bank,' after
 `Comptroller of the Currency,';
 (C) by striking out `either' in the 1st sentence and inserting in lieu
 thereof `any';
 (D) in the last sentence of subparagraph (A), by inserting `or savings
 associations' after `banks';
 (E) by striking out `State nonmember bank (except a District bank)' and
 inserting in lieu thereof `depository institution'; and
 (F) by striking out subparagraph (B) and inserting the following:
 `(B) ADDITIONAL REPORTS- The Board of Directors may from time to time
 require any insured depository institution to file such additional reports
 as the Corporation, after agreement with the Comptroller of the Currency,
 the Board of Governors of the Federal Reserve System, and the Director of
 the Office of Thrift Supervision, as appropriate, may deem advisable for
 insurance purposes.';
 (2) in subsection (a)(3)--
 (A) by striking out `Each insured State nonmember bank' and all that follows
 through `four reports' and inserting the following: `Each insured depository
 institution shall make to the appropriate Federal banking agency 4 reports';
 (B) by striking out `bank' each place such term appears in the 2nd, 5th,
 and 6th sentences and inserting in lieu thereof `depository institution';
 (C) by striking out `insured national, District' and all that follows
 through `member bank' in the 7th sentence and inserting in lieu thereof
 `insured depository institution'; and
 (D) by inserting `or savings associations' after `banks' in the last sentence;
 (3) in subsection (a)(4), by striking out `bank', `bank's', and `banks'
 each place such terms appear (except in `foreign bank') and inserting in
 lieu thereof `depository institution', `depository institution's', and
 `depository institutions', respectively;
 (4) by striking out paragraphs (1) and (2) of subsection (b) and inserting
 the following:
 `(1) ASSESSMENT RATES-
 `(A) ANNUAL ASSESSMENT RATES PRESCRIBED-
 `(i) The Corporation shall set assessment rates for insured depository
 institutions annually.
 `(ii) The Corporation shall fix the annual assessment rate of Bank Insurance
 Fund members independently from the annual assessment rate for Savings
 Association Insurance Fund members.
 `(iii) The Corporation shall, by September 30 of each year, announce the
 assessment rates for the succeeding calendar year.
 `(B) DESIGNATED RESERVE RATIO DEFINED-
 `(i) The designated reserve ratio of the Bank Insurance Fund for each year
 shall be--
 `(I) 1.25 percent of estimated insured deposits; or
 `(II) such higher percentage of estimated insured deposits, not exceeding
 1.50 percent, as the Board of Directors determines for that year to be
 justified by circumstances that raise a significant risk of substantial
 future losses to the Bank Insurance Fund.
 `(ii) The designated reserve ratio of the Savings Association Insurance
 Fund for each year shall be--
 `(I) 1.25 percent of estimated insured deposits; or
 `(II) such higher percentage of estimated insured deposits, not exceeding
 1.50 percent, as the Board of Directors determines for that year to be
 justified by circumstances that raise a significant risk of substantial
 future losses to the Savings Association Insurance Fund.
 `(iii) The Board of Directors shall--
 `(I) maintain reserves in the Bank Insurance Fund received pursuant to clause
 (i)(II) as Supplemental Reserves in the Bank Insurance Fund;
 `(II) allocate each calendar quarter to an Earnings Participation Account in
 the Bank Insurance Fund the investment income earned by the Bank Insurance
 Fund on such Supplemental Reserves in the preceding calendar quarter;
 `(III) distribute such Earnings Participation Account at the conclusion of
 each calendar year to Bank Insurance Fund members; and
 `(IV) distribute such Supplemental Reserves to Bank Insurance Fund members
 if and to the extent the Corporation determines that such Supplemental
 Reserves are not needed to satisfy the projected designated reserve ratio
 for the next succeeding calendar year.
 `(iv) The Board of Directors shall--
 `(I) maintain reserves in the Savings Association Insurance Fund received
 pursuant to clause (ii)(II) as Supplemental Reserves in the Savings
 Association Insurance Fund;
 `(II) allocate each calendar quarter to an Earnings Participation Account
 in the Savings Association Insurance Fund the investment income earned by
 the Savings Association Insurance Fund on such Supplemental Reserves in
 the preceding calendar quarter;
 `(III) distribute such Earnings Participation Account at the conclusion of
 each calendar year to Savings Association Insurance Fund members; and
 `(IV) distribute such Supplemental Reserves to Savings Association Insurance
 Fund members if and to the extent the Corporation determines that such
 Supplemental Reserves are not needed to satisfy the projected designated
 reserve ratio for the next succeeding calendar year.
 `(C) ASSESSMENT RATE FOR BANK INSURANCE FUND MEMBERS- The annual assessment
 rate for Bank Insurance Fund members shall be--
 `(i) until December 31, 1989,  1/12  of 1 percent;
 `(ii) from January 1, 1990, through December 31, 1990, 0.12 percent;
 `(iii) on and after January 1, 1991, 0.15 percent;
 `(iv) on January 1 of a calendar year in which the reserve ratio of the
 Bank Insurance Fund is expected to be less than the designated reserve
 ratio by determination of the Board of Directors, such rate determined
 by the Board of Directors to be appropriate to restore the reserve ratio
 to the designated reserve ratio within a reasonable period of time, after
 taking into consideration the expected operating expenses, case resolution
 expenditures, and investment income of the Bank Insurance Fund, and the
 impact on insured bank earnings and capitalization, except that--
 `(I) from the date of the enactment of the Financial Institutions Reform,
 Recovery, and Enforcement Act of 1989 until the earlier of January 1, 1995,
 or January 1 of the calendar year in which the Bank Insurance Fund reserve
 ratio is expected to first attain the designated reserve ratio, the rate
 shall be as specified in clauses (i), (ii), and (iii) of this subparagraph
 so long as the Bank Insurance Fund reserve ratio is increasing on a calendar
 year basis;
 `(II) the rate shall not exceed 0.325 percent; and
 `(III) the increase in the rate in any 1 year shall not exceed 0.075
 percent; and
 `(v) sufficient to ensure that for each member in each year the assessment
 shall not be less than $1,000.
 `(D) ASSESSMENT RATE FOR SAVINGS ASSOCIATION INSURANCE FUND MEMBERS-
 The annual assessment rate for Savings Association Insurance Fund members
 shall be--
 `(i) until December 31, 1990, 0.208 percent;
 `(ii) from January 1, 1991, through December 31, 1993, 0.23 percent;
 `(iii) from January 1, 1994, through December 31, 1997, 0.18 percent;
 `(iv) on and after January 1, 1998, 0.15 percent;
 `(v) on January 1 of a calendar year in which the reserve ratio of
 the Savings Association Insurance Fund is expected to be less than the
 designated reserve ratio by determination of the Board of Directors, such
 rate determined by the Board of Directors to be appropriate to restore the
 reserve ratio to the designated reserve ratio within a reasonable period of
 time, after taking into consideration the expected expenses and income of
 the Savings Association Insurance Fund, and the effect on insured savings
 association earnings and capitalization, except that--
 `(I) from the date of the enactment of the Financial Institutions Reform,
 Recovery, and Enforcement Act of 1989 through December 31, 1994, the rate
 shall be as specified in clauses (i), (ii), and (iii) above;
 `(II) the rate shall not exceed 0.325 percent; and
 `(III) the increase in the rate in any one year shall not exceed 0.075
 percent; and
 `(v) sufficient to ensure that for each member in each year the assessment
 shall not be less than $1,000.
 `(E) FINANCING CORPORATION AND FUNDING CORPORATION ASSESSMENTS-
 Notwithstanding any other provision of this paragraph, amounts assessed by
 the Financing Corporation and the Funding Corporation under sections 21
 and 21B, respectively, of the Federal Home Loan Bank Act against Savings
 Association Insurance Fund members, shall be subtracted from the amounts
 authorized to be assessed by the Corporation under this paragraph.
 `(F) SPECIAL RULE TO ALLOW CONTINUING ASSESSMENTS BY THE FINANCING
 CORPORATION AND THE FUNDING CORPORATION DURING PREMIUM YEAR ADJUSTMENTS- In
 order to ensure that the Financing Corporation and the Resolution Funding
 Corporation obtain sufficient funds for interest payments on obligations
 of such corporations, the Corporation, in coordination with the Financing
 Corporation and the Secretary of the Treasury, may prescribe such regulations
 as may be necessary to allow the Financing Corporation and the Resolution
 Funding Corporation to impose assessments against Savings Association
 Insurance Fund members pursuant to sections 21 and 21B, respectively, of
 the Federal Home Loan Bank Act during the period required to change such
 members' premium year from the 1-year period applicable under section 404(b)
 of the National Housing Act (as in effect before the date of the enactment
 of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989)
 to a calendar year basis.
 `(2) ASSESSMENT PROCEDURES-
 `(A) SEMIANNUAL ASSESSMENTS- Except as provided in subsection (c)(2)--
 `(i) the semiannual assessment due from any Bank Insurance Fund member for
 any semiannual period shall be equal to the product of--
 `(I)  1/2  the annual assessment rate applicable to such Bank Insurance
 Fund member; and
 `(II) such Bank Insurance Fund member's average assessment base for the
 immediately preceding semiannual period; and
 `(ii) the semiannual assessment due from any Savings Association Insurance
 Fund member for any semiannual period shall be equal to the product of--
 `(I)  1/2  the annual assessment rate applicable to such Savings Association
 Insurance Fund member; and
 `(II) such Savings Association Insurance Fund member's average assessment
 base for the immediately preceding semiannual period.
 `(B) DEFINITION- For purposes of this section, the term `semiannual period'
 means a period beginning on January 1 of any calendar year and ending on
 June 30 of the same year, or a period beginning on July 1 of any calendar
 year and ending on December 31 of the same year.';
 (5) by amending subsection (d) to read as follows:
 `(d) ASSESSMENT CREDITS-
 `(1) IN GENERAL-
 `(A) By September 30 of each calendar year, the Corporation shall prescribe
 and publish the aggregate amount to be credited to insured depository
 institutions in the succeeding calendar year.
 `(B) Each insured depository institution shall be notified by the Corporation
 of the percentage by which the assessment rate should be reduced in computing
 its net premium.
 `(C) Any outstanding obligations owed to the Corporation by an individual
 insured depository institution shall be deducted from any assessment credit
 to be credited to such depository institution.
 `(2) ASSESSMENT CREDIT FOR INSURED BANKS-
 `(A) CREDIT BARRED- The Board of Directors shall not prescribe an assessment
 credit to Bank Insurance Fund members if the Board of Directors determines
 that the Bank Insurance Fund reserve ratio is expected to be equal to or
 less than the designated reserve ratio in the coming year after taking into
 consideration such Fund's expected expenses and income.
 `(B) CREDIT AUTHORIZED- If the Board of Directors determines, after taking
 into consideration the Bank Insurance Fund's expected operating expenses,
 case resolution expenditures, investment income, and assessment income,
 that the Bank Insurance Fund reserve ratio is expected to exceed the
 designated reserve ratio in the succeeding year, the Board of Directors
 shall prescribe an assessment credit to Bank Insurance Fund members in such
 succeeding calendar year equal to the lesser of--
 `(i) the amount necessary to reduce the Bank Insurance Fund reserve ratio
 to the designated reserve ratio; or
 `(ii) 100 percent of the net assessment income to be received from Bank
 Insurance Fund members in such succeeding year.
 `(3) ASSESSMENT CREDIT FOR INSURED SAVINGS ASSOCIATIONS-
 `(A) CREDIT BARRED- The Board of Directors shall not prescribe an assessment
 credit to Savings Association Insurance Fund members if the Board of
 Directors determines that the Savings Association Insurance Fund reserve
 ratio is expected to be equal to or less than the designated reserve ratio
 in the coming year after taking into consideration such Fund's expected
 expenses and income.
 `(B) CREDIT AUTHORIZED- If the Board of Directors determines, after taking
 into consideration the Savings Association Insurance Fund's expected expenses
 and income, that the Savings Association Insurance Fund reserve ratio is
 expected to exceed the designated reserve ratio in the succeeding year,
 the Board of Directors shall prescribe an assessment credit to Savings
 Association Insurance Fund members in such succeeding calendar year equal
 to the lesser of--
 `(i) the amount necessary to reduce the Savings Association Insurance Fund
 reserve ratio to the designated reserve ratio; or
 `(ii) 100 percent of the net assessment income to be received from Savings
 Association Insurance Fund members in such succeeding year.
 `(4) NET ASSESSMENT INCOME DEFINED- For purposes of this subsection--
 `(A) IN GENERAL- The term `net assessment income' means--
 `(i) with respect to the Bank Insurance Fund, the Bank Insurance Fund net
 assessment income (as defined in subparagraph (B)); and
 `(ii) with respect to the Savings Association Insurance Fund, the Savings
 Association Insurance Fund net assessment income (as defined in subparagraph
 (C)).
 `(B) BANK INSURANCE FUND NET ASSESSMENT INCOME-
 `(i) IN GENERAL- The term `Bank Insurance Fund net assessment income' means--
 `(I) the total assessments which become due during the calendar year with
 respect to members of such Fund, minus
 `(II) the sum of the amount of the operating costs and expenses described in
 clause (ii) and the amount by which the Bank Insurance Fund's insurance costs
 described in clause (iii) exceed its investment income for the calendar year.
 `(ii) OPERATING COST AND EXPENSES- For the purposes of this subparagraph,
 the operating costs and expenses to be deducted from assessments include
 the operating costs and expenses of--
 `(I) the Corporation for the calendar year directly attributable to the
 Bank Insurance Fund; and
 `(II) the Bank Insurance Fund.
 `(iii) INSURANCE COSTS- For purposes of this subparagraph, the insurance
 costs include--
 `(I) additions to the Bank Insurance Fund's reserve to provide for insurance
 losses during the calendar year, excluding any adjustments to such reserve
 which result in a reduction of such reserve; and
 `(II) the insurance losses sustained in such calendar year.
 `(C) SAVINGS ASSOCIATION INSURANCE FUND NET ASSESSMENT INCOME-
 `(i) IN GENERAL- The term `Savings Association Insurance Fund net assessment
 income' means--
 `(I) the total assessments which become due during the calendar year with
 respect to members of such Fund, minus
 `(II) the sum of the amount of the operating costs and expenses described
 in clause (ii) and the amount by which the Savings Association Insurance
 Fund's insurance costs described in clause (iii) exceed its investment
 income for the calendar year.
 `(ii) OPERATING COST AND EXPENSES- For purposes of this subparagraph, the
 operating costs and expenses to be deducted from assessments include the
 operating costs and expenses of--
 `(I) the Corporation for the calendar year directly attributable to the
 Savings Association Insurance Fund; and
 `(II) the Savings Association Insurance Fund.
 `(iii) INSURANCE COSTS- For the purposes of this subparagraph, the insurance
 costs include--
 `(I) additions to the Savings Association Insurance Fund's reserve to provide
 for insurance losses during the calendar year, excluding any adjustments
 to such reserve which result in a reduction of such reserve; and
 `(II) the insurance losses sustained in such calendar year.
 `(5) INVESTMENT INCOME DEFINED- For purposes of this subsection, the term
 `investment income' means--
 `(A) for the Bank Insurance Fund, interest, dividends, and net market gains
 earned on investments of the Bank Insurance Fund; and
 `(B) for the Savings Association Insurance Fund, interest, dividends,
 and net market gains earned on investments of the Savings Association
 Insurance Fund.'.
 (6) in paragraphs (3), (4), (5), (6), (7), and (8) of subsection (b), by
 striking out `bank', `bank's', and `banks' each place such term appears
 (except where `foreign' precedes any of such terms) and inserting in
 lieu thereof `depository institution', `depository institution's', and
 `depository institutions', respectively;
 (7) in subsections (c), (e), (f), (g), and (i), by striking out `bank'
 each place such term appears and inserting in lieu thereof `depository
 institution';
 (8) in subsection (j)(1), by striking out the last sentence;
 (9) in subsection (j)(2)(A)--
 (A) by striking out `failure' and inserting in lieu thereof `default'; and
 (B) by striking out `bank' each place such term appears and inserting in
 lieu thereof `depository institution';
 (10) in subsection (j)(2)(D), by inserting `unless such agency determines
 that an emergency exists,' after `shall,';
 (11) in subsection (j)(7)--
 (A) by striking out `or' at the end of subparagraph (D);
 (B) by striking out the period at the end of subparagraph (E) and inserting
 in lieu thereof `; or'; and
 (C) by adding at the end thereof the following new subparagraph:
 `(F) the appropriate Federal banking agency determines that the proposed
 transaction would result in an adverse effect on the Bank Insurance Fund
 or the Savings Association Insurance Fund.';
 (12) by amending subsection (j)(17) to read as follows:
 `(17) EXCEPTIONS- This subsection shall not apply with respect to a
 transaction which is subject to--
 `(A) section 3 of the Bank Holding Company Act of 1956;
 `(B) section 18(c) of this Act; or
 `(C) section 10 of the Home Owners' Loan Act.';
 (13) by adding at the end of subsection (j) the following new paragraph:
 `(18) APPLICABILITY OF CHANGE IN CONTROL PROVISIONS TO OTHER INSTITUTIONS-
 For purposes of this subsection, the term `insured depository institution'
 includes--
 `(A) any depository institution holding company; and
 `(B) any other company which controls an insured depository institution
 and is not a depository institution holding company.';
 (14) by adding at the end thereof the following new subsection:
 `(l) DESIGNATION OF FUND MEMBERSHIP FOR NEWLY INSURED DEPOSITORY INSTITUTIONS;
 DEFINITIONS- For purposes of this section:
 `(1) BANK INSURANCE FUND- Any institution which--
 `(A) becomes an insured depository institution; and
 `(B) does not become a Savings Association Insurance Fund member pursuant
 to paragraph (2),
shall be a Bank Insurance Fund member.
 `(2) SAVINGS ASSOCIATION INSURANCE FUND- Any savings association, other
 than any Federal savings bank chartered pursuant to section 5(o) of the Home
 Owners' Loan Act, which becomes an insured depository institution shall be
 a Savings Association Insurance Fund member.
 `(3) TRANSITION PROVISION-
 `(A) BANK INSURANCE FUND- Any depository institution the deposits of which
 were insured by the Federal Deposit Insurance Corporation on the day before
 the date of the enactment of the Financial Institutions Reform, Recovery,
 and Enforcement Act of 1989, including--
 `(i) any Federal savings bank chartered pursuant to section 5(o) of the
 Home Owners' Loan Act; and
 `(ii) any cooperative bank,
shall be a Bank Insurance Fund member as of such date of enactment.
 `(B) SAVINGS ASSOCIATION INSURANCE FUND- Any savings association which is
 an insured depository institution by operation of section 4(a)(2) shall be
 a Savings Association Insurance Fund member as of the date of the enactment
 of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989.
 `(4) BANK INSURANCE FUND MEMBER- The term `Bank Insurance Fund member'
 means any depository institution the deposits of which are insured by the
 Bank Insurance Fund.
 `(5) SAVINGS ASSOCIATION INSURANCE FUND MEMBER- The term `Savings Association
 Insurance Fund member' means any depository institution the deposits of
 which are insured by the Savings Association Insurance Fund.
 `(6) BANK INSURANCE FUND RESERVE RATIO- The term `Bank Insurance Fund
 reserve ratio' means the ratio of the net worth of the Bank Insurance Fund
 to the value of the aggregate estimated insured deposits held in all Bank
 Insurance Fund members.
 `(7) SAVINGS ASSOCIATION INSURANCE FUND RESERVE RATIO- The term `Savings
 Association Insurance Fund reserve ratio' means the ratio of the value of
 the net worth of the Savings Association Insurance Fund to the value of
 the aggregate estimated insured deposits held in all Savings Association
 Insurance Fund members.';
 (15) by adding after the subsection added by paragraph (14) of this section
 the following new subsections:
 `(m) SECONDARY RESERVE OFFSETS AGAINST PREMIUMS-
 `(1) OFFSETS IN CALENDAR YEARS BEGINNING BEFORE 1993- Subject to the
 maximum amount limitation contained in paragraph (2) and notwithstanding
 any other provision of law, any insured savings association may offset such
 association's pro rata share of the statutorily prescribed amount against
 any premium assessed against such association under subsection (b) of this
 section for any calendar year beginning before 1993.
 `(2) ANNUAL MAXIMUM AMOUNT LIMITATION- The amount of any offset allowed for
 any savings association under paragraph (1) for any calendar year beginning
 before 1993 shall not exceed an amount which is equal to 20 percent of
 such association's pro rata share of the statutorily prescribed amount
 (as computed for such calendar year).
 `(3) OFFSETS IN CALENDAR YEARS BEGINNING AFTER 1992- Notwithstanding any
 other provision of law, a savings association may offset such association's
 pro rata share of the statutorily prescribed amount against any premium
 assessed against such association under subsection (b) for any calendar
 year beginning after 1992.
 `(4) TRANSFERABILITY- No right, title, or interest of any insured depository
 institution in or with respect to its pro rata share of the secondary reserve
 shall be assignable or transferable whether by operation of law or otherwise,
 except to the extent that the Corporation may provide for transfer of such
 pro rata share in cases of merger or consolidation, transfer of bulk assets
 or assumption of liabilities, and similar transactions, as defined by the
 Corporation for purposes of this paragraph.
 `(5) PRO RATA DISTRIBUTION ON TERMINATION OF INSURED STATUS- If--
 `(A) the status of any savings association as an insured depository
 institution is terminated pursuant to any provision of section 8 or the
 insurance of accounts of any savings association institution is otherwise
 terminated;
 `(B) a receiver or other legal custodian is appointed for the purpose of
 liquidation or winding up the affairs of any savings association; or
 `(C) the Corporation makes a determination that for the purposes of this
 subsection any savings association has otherwise gone into liquidation,
the Corporation shall pay in cash to such institution its pro rata share
of the secondary reserve, in accordance with such terms and conditions
as the Corporation may prescribe, or, at the option of the Corporation,
the Corporation may apply the whole or any part of the amount which would
otherwise be paid in cash toward the payment of any indebtedness or obligation,
whether matured or not, of such institution to the Corporation, existing or
arising before such payment in cash. Such payment or such application need
not be made to the extent that the provisions of the exception in paragraph
(4) are applicable.
 `(6) STATUTORILY PRESCRIBED AMOUNT DEFINED- For purposes of this subsection,
 the term `statutorily prescribed amount' means, with respect to any calendar
 year which ends after the date of the enactment of the Financial Institutions
 Reform, Recovery, and Enforcement Act of 1989--
 `(A) $823,705,000, minus
 `(B) the sum of--
 `(i) the aggregate amount of offsets made before such date of enactment by
 all insured institutions under section 404(e)(2) of the National Housing Act
 (as in effect before such date of enactment); and
 `(ii) the aggregate amount of offsets made by all savings associations
 under this subsection before the beginning of such calendar year.
 `(7) SAVINGS ASSOCIATION'S PRO RATA AMOUNT- For purposes of this subsection,
 any savings association's pro rata share of the statutorily prescribed
 amount is the percentage which is equal to such association's share of
 the secondary reserve as determined under section 404(e) of the National
 Housing Act on the day before the date on which Federal Savings and Loan
 Insurance Corporation ceased to recognize the secondary reserve (as such
 Act was in effect on the day before such date).
 `(8) YEAR OF ENACTMENT RULE- With respect to the calendar year in which
 the Financial Institutions Reform, Recovery, and Enforcement Act of 1989
 is enacted, the Corporation shall make such adjustments as may be necessary--
 `(A) in the computation of the statutorily prescribed amount which shall be
 applicable for the remainder of such calendar year after taking into account
 the aggregate amount of offsets by all insured institutions under section
 404(e)(2) of the National Housing Act (as in effect before the date of the
 enactment of the Financial Institutions Reform, Recovery, and Enforcement
 Act of 1989) after the beginning of such calendar year and before such date
 of enactment; and
 `(B) in the computation of the maximum amount of any savings association's
 offset for such calendar year under paragraph (1) after taking into account--
 `(i) the amount of any offset by such savings association under section
 404(e)(2) of the National Housing Act (as in effect before such date of
 enactment) after the beginning of such calendar year and before such date
 of enactment; and
 `(ii) the change of such association's premium year from the 1-year period
 applicable under section 404(b) of the National Housing Act (as in effect
 before such date of enactment) to a calendar year basis.
 `(n) COLLECTIONS ON BEHALF OF THE DIRECTOR OF THE OFFICE OF THRIFT
 SUPERVISION- When requested by the Director of the Office of Thrift
 Supervision, the Corporation shall collect on behalf of the Director
 assessments on savings associations levied by the Director under section 9
 of the Home Owners' Loan Act. The Corporation shall be reimbursed for its
 actual costs for the collection of such assessments. Any such assessments by
 the Director shall be in addition to any amounts assessed by the Corporation,
 the Financing Corporation, and the Resolution Funding Corporation.'.
SEC. 209. CORPORATE POWERS OF THE FDIC .
 Section 9 of the Federal Deposit Insurance Act (12 U.S.C. 1819) is amended--
 (1) by striking out `bank' and `banks' each place such terms appear (except
 in the last sentence of the paragraph designated the `Fourth') and inserting
 in lieu thereof `depository institution' and `depository institutions',
 respectively; and
 (2) by striking out `Upon the date' and inserting the following:
 `(a) IN GENERAL- Upon the date';
 (3) by amending the paragraph designated the `Fourth' to read as follows:
`Fourth. To sue and be sued, and complain and defend, in any court of law
or equity, State or Federal.'; and
 (4) by adding at the end thereof the following new subsection:
 `(b) AGENCY AUTHORITY-
 `(1) STATUS- The Corporation, in any capacity, shall be an agency of the
 United States for purposes of section 1345 of title 28, United States Code,
 without regard to whether the Corporation commenced the action.
 `(2) FEDERAL COURT JURISDICTION-
 `(A) IN GENERAL- Except as provided in subparagraph (D), all suits of a civil
 nature at common law or in equity to which the Corporation, in any capacity,
 is a party shall be deemed to arise under the laws of the United States.
 `(B) REMOVAL- Except as provided in subparagraph (D), the Corporation may,
 without bond or security, remove any action, suit, or proceeding from a
 State court to the appropriate United States district court.
 `(C) APPEAL OF REMAND- The Corporation may appeal any order of remand
 entered by any United States district court.
 `(D) STATE ACTIONS- Except as provided in subparagraph (E), any action--
 `(i) to which the Corporation, in the Corporation's capacity as receiver
 of a State insured depository institution by the exclusive appointment by
 State authorities, is a party other than as a plaintiff;
 `(ii) which involves only the preclosing rights against the State insured
 depository institution, or obligations owing to, depositors, creditors,
 or stockholders by the State insured depository institution; and
 `(iii) in which only the interpretation of the law of such State is necessary,
shall not be deemed to arise under the laws of the United States.
 `(E) RULE OF CONSTRUCTION- Subparagraph (D) shall not be construed as
 limiting the right of the Corporation to invoke the jurisdiction of any
 United States district court in any action described in such subparagraph
 if the institution of which the Corporation has been appointed receiver
 could have invoked the jurisdiction of such court.
 `(3) SERVICE OF PROCESS- The Board of Directors shall designate agents upon
 whom service of process may be made in any State, territory, or jurisdiction
 in which any insured depository institution is located.
 `(4) BONDS OR FEES- The Corporation shall not be required to post any bond
 to pursue any appeal and shall not be subject to payments of any filing
 fees in United States district courts or courts of appeal.'.
SEC. 210. ADMINISTRATION OF CORPORATION.
 (a) EXAMINATION AUTHORITY- Section 10(b) of the Federal Deposit Insurance
 Act (12 U.S.C. 1820(b)) is amended to read as follows:
 `(b) EXAMINATIONS-
 `(1) APPOINTMENT OF EXAMINERS AND CLAIMS AGENTS- The Board of Directors
 shall appoint examiners and claim 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 (except a District bank) or insured
 State branch of any foreign bank;
 `(B) any savings association, State nonmember bank, or State branch of a
 foreign bank, or other 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- 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 whenever the
 Board of Directors determines a special examination of any such depository
 institution is necessary to determine the condition of such depository
 institution for insurance purposes.
 `(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 insured depository institution as may be necessary to disclose fully--
 `(i) the relationship between such insured depository institution and any
 such affiliate; and
 `(ii) the effect of such relationship on the insured 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) 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), or (4); and
 `(B) shall make a full and detailed report of condition of any insured
 depository institution or affiliate examined to the Corporation.
 `(6) POWER OF CLAIM AGENTS- Each claim agent appointed under paragraph (1)
 shall have power to investigate and examine all claims for insured deposits.'.
 (b) TECHNICAL AND CONFORMING AMENDMENTS-
 (1) Section 10(c) of the Federal Deposit Insurance Act (12 U.S.C. 1820(c))
 is amended by striking out `, State nonmember banks or other institutions' and
 inserting in lieu thereof `and any State nonmember bank, savings association,
 or other institution'.
 (2) Section 10 of the Federal Deposit Insurance Act (12 U.S.C. 1820) is
 amended by striking out subsection (d).
SEC. 211. INSURANCE FUNDS.
 Section 11(a) of the Federal Deposit Insurance Act (12 U.S.C. 1821(a))
 is amended--
 (1) by striking out paragraph (1) and inserting the following:
 `(1) The Corporation shall insure the deposits of all insured depository
 institutions as provided in this Act. The maximum amount of the insured
 deposit of any depositor shall be $100,000.';
 (2) in paragraph (2)(B), by striking out `time and savings'; and
 (3) by adding at the end the following new paragraphs:
 `(4) GENERAL PROVISION RELATING TO FUNDS- The Bank Insurance Fund established
 under paragraph (5) and the Savings Association Insurance Fund established
 under paragraph (6) shall each be--
 `(A) maintained and administered by the Corporation;
 `(B) maintained separately and not commingled; and
 `(C) used by the Corporation to carry out its insurance purposes in the
 manner provided in this subsection.
 `(5) BANK INSURANCE FUND-
 `(A) ESTABLISHMENT- There is established a fund to be known as the Bank
 Insurance Fund.
 `(B) TRANSFER TO FUND- On the date of the enactment of the Financial
 Institutions Reform, Recovery, and Enforcement Act of 1989, the Permanent
 Insurance Fund shall be dissolved and all assets and liabilities of the
 Permanent Insurance Fund shall be transferred to the Bank Insurance Fund.
 `(C) USES- The Bank Insurance Fund shall be available to the Corporation
 for use with respect to Bank Insurance Fund members.
 `(D) DEPOSITS- All amounts assessed against Bank Insurance Fund members by
 the Corporation shall be deposited into the Bank Insurance Fund.
 `(6) SAVINGS ASSOCIATION INSURANCE FUND-
 `(A) ESTABLISHMENT- There is established a fund to be known as the Savings
 Association Insurance Fund.
 `(B) USES- The Savings Association Insurance Fund shall be available to
 the Corporation for use with respect to Savings Association Insurance
 Fund members.
 `(C) DEPOSITS- All amounts assessed against Savings Association Insurance
 Fund members which are not required for the Financing Corporation, the
 Resolution Funding Corporation, or the FSLIC Resolution Fund shall be
 deposited in the Savings Association Insurance Fund.
 `(D) AVAILABILITY OF FUNDS FOR ADMINISTRATIVE EXPENSES-
 `(i) IN GENERAL- The FSLIC Resolution Fund shall deposit in the Savings
 Association Insurance Fund such amounts as the Corporation determines are
 needed during the period beginning on the date of the enactment of the
 Financial Institutions Reform, Recovery, and Enforcement Act of 1989 and
 ending on September 30, 1991, to pay the administrative and supervisory
 expenses of such Fund.
 `(ii) PRIORITY- The Savings Association Insurance Fund shall have priority
 over other obligations of the FSLIC Resolution Fund with respect to such
 amounts.
 `(E) TREASURY PAYMENTS TO FUND- To provide sufficient funding for the
 Savings Association Insurance Fund to carry out the purposes of this Act,
 the Secretary of the Treasury shall pay to such Fund, for each of the fiscal
 years 1992 through 1999, the amount, if any, by which $2,000,000,000 exceeds
 the amount deposited in such Fund (during such fiscal year) pursuant to
 subparagraph (C).
 `(F) TREASURY PAYMENTS TO MAINTAIN NET WORTH OF FUND- The Secretary of
 the Treasury shall pay to the Savings Association Insurance Fund, for each
 fiscal year described in the following table, any additional amount which
 may be necessary, as determined by the Corporation and the Secretary of
 the Treasury to ensure that such Fund has the minimum net worth referred
 to in such table throughout each such fiscal year:
--The amount of
`For the fiscal year
--minimum net worth
beginning October 1 of:
--(in billions):
 1991
--0.0
 1992
--1.0
 1993
--2.1
 1994
--3.2
 1995
--4.3
 1996
--5.4
 1997
--6.5
 1998
--7.6
 1999
--8.8
 `(G) EXCEPTION TO SUBPARAGRAPHS (E) AND (F)- Notwithstanding subparagraphs
 (E) and (F), no payment may be made pursuant to such subparagraphs after the
 Savings Association Insurance Fund achieves a reserve ratio of 1.25 percent.
 `(H) DISCRETIONARY RTC PAYMENTS- If amounts available to the Savings
 Association Insurance Fund for purposes other than the payment
 of administrative expenses are insufficient for the Savings Association
 Insurance Fund to carry out the purposes of this Act, the Corporation may
 request the Resolution Trust Corporation to provide, and the Oversight Board
 of the Resolution Trust Corporation (in the discretion of the Oversight
 Board) may pay, such amount as may be needed for such purposes.
 `(I) BORROWING AUTHORITY-
 `(i) IN GENERAL- The Corporation may borrow from the Federal home loan banks,
 with the concurrence of the Federal Housing Finance Board, such funds as
 the Corporation considers necessary for the use of the Savings Association
 Insurance Fund.
 `(ii) TERMS AND CONDITIONS- Any loan from any Federal home loan bank under
 clause (i) to the Savings Association Insurance Fund shall--
 `(I) bear a rate of interest of not less than such bank's current marginal
 cost of funds, taking into account the maturities involved;
 `(II) be adequately secured, as determined by the Federal Housing Finance
 Board;
 `(III) be a direct liability of such Fund; and
 `(IV) be subject to the limitations of section 15(c).
 `(J) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be appropriated
 to the Secretary of the Treasury, such sums as may be necessary to carry
 out the provisions of this paragraph, except that--
 `(i) the annual amount appropriated under subparagraph (F) shall not exceed
 $2,000,000,000 in either fiscal year 1991 or fiscal year 1992; and
 `(ii) the cumulative amount appropriated under subparagraph (F) for fiscal
 years 1991 through 1999 shall not exceed $16,000,000,000.
 `(7) PROVISIONS APPLICABLE TO MAINTENANCE OF ACCOUNTS-
 `(A) CORPORATION'S AUTHORITY- Any provision of this Act forbidding the
 commingling of the Bank Insurance Fund with the Savings Association Insurance
 Fund, or requiring the separate maintenance of the Bank Insurance Fund and
 the Savings Association Insurance Fund, is not intended--
 `(i) to limit or impair the authority of the Corporation to use the same
 facilities and resources in the course of conducting supervisory, regulatory,
 conservatorship, receivership, or liquidation functions with respect to
 banks and savings associations, or to integrate such functions; or
 `(ii) to limit or impair the Corporation's power to combine assets or
 liabilities belonging to banks and savings associations in conservatorship or
 receivership for managerial purposes, or to limit or impair the Corporation's
 power to dispose of such assets or liabilities on an aggregate basis.
 `(B) ACCOUNTING REQUIREMENTS-
 `(i) ACCOUNTING FOR USE OF FACILITIES AND RESOURCES- The Corporation shall
 keep a full and complete accounting of all costs and expenses associated
 with the use of any facility or resource used in the course of any function
 specified in subparagraph (A)(i) and shall allocate, in the manner provided
 in subparagraph (C), any such costs and expenses incurred by the Corporation--
 `(I) with respect to Bank Insurance Fund members to the Bank Insurance
 Fund; and
 `(II) with respect to Savings Association Insurance Fund members to the
 Savings Association Insurance Fund.
 `(ii) ACCOUNTING FOR HOLDING AND MANAGING ASSETS AND LIABILITIES- The
 Corporation shall keep a full and complete accounting of all costs and
 expenses associated with the holding and management of any asset or liability
 specified in subparagraph (A)(ii).
 `(iii) ACCOUNTING FOR DISPOSITION OF ASSETS AND LIABILITIES- The Corporation
 shall keep a full and complete accounting of all expenses and receipts
 associated with the disposition of any asset or liability specified in
 subparagraph (A)(ii).
 `(iv) ALLOCATION OF COST, EXPENSES AND RECEIPTS- The Corporation shall
 allocate any cost, expense, and receipt described in clause (ii) or clause
 (iii) which is associated with any asset or liability belonging to--
 `(I) any Bank Insurance Fund member to the Bank Insurance Fund; and
 `(II) any Savings Association Insurance Fund member to the Savings Association
 Insurance Fund.
 `(C) ALLOCATION OF ADMINISTRATIVE EXPENSES- Any personnel, administrative,
 or other overhead expense of the Corporation shall be allocated--
 `(i) fully to the Bank Insurance Fund, if the expense was incurred directly
 as a result of the Corporation's responsibilities solely with respect to
 Bank Insurance Fund members;
 `(ii) fully to the Savings Association Insurance Fund, if the expense was
 incurred directly as a result of the Corporation's responsibilities solely
 with respect to Savings Association Insurance Fund members;
 `(iii) between the Bank Insurance Fund and the Savings Association Insurance
 Fund, in amounts reflecting the relative degree to which the expense was
 incurred as a result of the activities of Bank Insurance Fund and Savings
 Association Insurance Fund members; or
 `(iv) between the Bank Insurance Fund and the Savings Association Insurance
 Fund, in amounts reflecting the relative total assets as of the end of the
 preceding calendar year of Bank Insurance Fund members and Savings Association
 Insurance Fund members, to the extent that the Board of Directors is unable
 to make a determination under clause (i), (ii), or (iii).'.
SEC. 212. CONSERVATORSHIP AND RECEIVERSHIP POWERS OF THE CORPORATION.
 (a) BASIC AUTHORITIES- Section 11 of the Federal Deposit Insurance Act
 (12 U.S.C. 1821) is amended by striking out subsections (c) through (j)
 and inserting the following new subsections:
 `(c) APPOINTMENT OF CORPORATION AS CONSERVATOR OR RECEIVER-
 `(1) IN GENERAL- Notwithstanding any other provision of Federal law, the law
 of any State, or the constitution of any State, the Corporation may accept
 appointment and act as conservator or receiver for any insured depository
 institution upon appointment in the manner provided in paragraph (2) or (3).
 `(2) FEDERAL DEPOSITORY INSTITUTIONS-
 `(A) APPOINTMENT-
 `(i) CONSERVATOR- The Corporation may, at the discretion of the supervisory
 authority, be appointed conservator of any insured Federal depository
 institution or District bank and the Corporation may accept such appointment.
 `(ii) RECEIVER- The Corporation shall be appointed receiver, and shall
 accept such appointment, whenever a receiver is appointed for the purpose
 of liquidation or winding up the affairs of an insured Federal depository
 institution or District bank by the appropriate Federal banking agency,
 notwithstanding any other provision of Federal law (other than section
 21A of the Federal Home Loan Bank Act) or the code of law for the District
 of Columbia.
 `(B) ADDITIONAL POWERS- In addition to and not in derogation of the powers
 conferred and the duties imposed by this section on the Corporation as
 conservator or receiver, the Corporation, to the extent not inconsistent
 with such powers and duties, shall have any other power conferred on or
 any duty (which is related to the exercise of such power) imposed on a
 conservator or receiver for any Federal depository institution under any
 other provision of law.
 `(C) CORPORATION NOT SUBJECT TO ANY OTHER AGENCY- When acting as conservator
 or receiver pursuant to an appointment described in subparagraph (A),
 the Corporation shall not be subject to the direction or supervision of
 any other agency or department of the United States or any State in the
 exercise of the Corporation's rights, powers, and privileges.
 `(D) DEPOSITORY INSTITUTION IN CONSERVATORSHIP SUBJECT TO BANKING AGENCY
 SUPERVISION- Notwithstanding subparagraph (C), any Federal depository
 institution for which the Corporation has been appointed conservator shall
 remain subject to the supervision of the appropriate Federal banking agency.
 `(3) INSURED STATE DEPOSITORY INSTITUTIONS--
 `(A) APPOINTMENT BY APPROPRIATE STATE SUPERVISOR- Whenever the authority
 having supervision of any insured State depository institution (other than
 a District depository institution) appoints a conservator or receiver for
 such institution and tenders appointment to the Corporation, the Corporation
 may accept such appointment.
 `(B) ADDITIONAL POWERS- In addition to the powers conferred and the
 duties related to the exercise of such powers imposed by State law on any
 conservator or receiver appointed under the law of such State for an insured
 State depository institution, the Corporation, as conservator or receiver
 pursuant to an appointment described in subparagraph (A), shall have the
 powers conferred and the duties imposed by this section on the Corporation
 as conservator or receiver.
 `(C) CORPORATION NOT SUBJECT TO ANY OTHER AGENCY- When acting as conservator
 or receiver pursuant to an appointment described in subparagraph (A),
 the Corporation shall not be subject to the direction or supervision of
 any other agency or department of the United States or any State in the
 exercise of its rights, powers, and privileges.
 `(D) DEPOSITORY INSTITUTION IN CONSERVATORSHIP SUBJECT TO BANKING AGENCY
 SUPERVISION- Notwithstanding subparagraph (C), any insured State depository
 institution for which the Corporation has been appointed conservator shall
 remain subject to the supervision of the appropriate State bank or savings
 association supervisor.
 `(4) APPOINTMENT OF CORPORATION BY THE CORPORATION- Except as otherwise
 provided in section 21A of the Federal Home Loan Bank Act and notwithstanding
 any other provision of Federal law, the law of any State, or the constitution
 of any State, the Corporation may appoint itself as sole conservator or
 receiver of any insured State depository institution if--
 `(A) the Corporation determines--
 `(i) that--
 `(I) a conservator, receiver, or other legal custodian has been appointed
 for such institution;
 `(II) such institution has been subject to the appointment of any such
 conservator, receiver, or custodian for a period of at least 15 consecutive
 days; and
 `(III) 1 or more of the depositors in such institution is unable to withdraw
 any amount of any insured deposit; or
 `(ii) that such institution has been closed by or under the laws of any
 State; and
 `(B) the Corporation determines that 1 or more of the grounds specified in
 paragraph (5)--
 `(i) existed with respect to such institution at the time--
 `(I) the conservator, receiver, or other legal custodian was appointed; or
 `(II) such institution was closed; or
 `(ii) exist at any time--
 `(I) during the appointment of the conservator, receiver, or other legal
 custodian; or
 `(II) while such institution is closed.
 `(5) GROUNDS FOR PARAGRAPH (4) APPOINTMENT- The grounds referred to in
 paragraph (4)(B) for the appointment of the Corporation as conservator or
 receiver for any insured State depository institution are as follows:
 `(A) Insolvency in that the assets of the institution are less than the
 institution's obligations to its creditors and others, including members
 of the institution.
 `(B) Substantial dissipation of assets or earnings due to--
 `(i) any violation of any law or regulation; or
 `(ii) any unsafe or unsound practice.
 `(C) An unsafe or unsound condition to transact business, including
 substantially insufficient capital or otherwise.
 `(D) Any willful violation of a cease-and-desist order which has become final.
 `(E) Any concealment of books, papers, records, or assets of the institution
 or any refusal to submit books, papers, records, or affairs of the institution
 for inspection to any examiner or to any lawful agent of the appropriate
 Federal banking agency or State bank or savings association supervisor.
 `(F) The likelihood that the institution will not be able to meet the demands
 of its depositors or pay its obligations in the normal course of business.
 `(G) The incurrence or likely incurrence of losses by the institution that
 will deplete all or substantially all of its capital with no reasonable
 prospect for the replenishment of the capital of the institution without
 Federal assistance.
 `(H) Any violation of any law or regulation, or an unsafe or unsound practice
 or condition which is likely to cause insolvency or substantial dissipation
 of assets or earnings, or is likely to weaken the condition of the institution
 or otherwise seriously prejudice the interests of its depositors.
 `(6) APPOINTMENT BY DIRECTOR OF THE OFFICE OF THRIFT SUPERVISION-
 `(A) CONSERVATOR- The Corporation or the Resolution Trust Corporation may,
 at the discretion of the Director of the Office of Thrift Supervision,
 be appointed conservator and the Corporation may accept any such appointment.
 `(B) RECEIVER- Whenever the Director of the Office of Thrift Supervision
 appoints a receiver under the provisions of section 5(d)(2)(C) of the Home
 Owner's Loan Act for the purpose of liquidation or winding up any savings
 association's affairs--
 `(i) during the 3-year period beginning on the date of the enactment of
 the Financial Institutions Reform, Recovery, and Enforcement Act of 1989,
 the Resolution Trust Corporation shall be appointed; and
 `(ii) after the end of the 3-year period referred to in clause (i), the
 Corporation shall be appointed.
 `(7) JUDICIAL REVIEW- If the Corporation appoints itself as conservator or
 receiver under paragraph (4), the insured State depository institution may,
 within 30 days thereafter, bring an action in the United States district court
 for the judicial district in which the home office of such institution is
 located, or in the United States District Court for the District of Columbia,
 for an order requiring the Corporation to remove itself as such conservator
 or receiver, and the court shall, upon the merits, dismiss such action or
 direct the Corporation to remove itself as such conservator or receiver.
 `(8) REPLACEMENT OF CONSERVATOR OF STATE DEPOSITORY INSTITUTION-
 `(A) IN GENERAL- In the case of any insured State depository institution for
 which the Corporation appointed itself as conservator pursuant to paragraph
 (4), the Corporation may, without any requirement of notice, hearing,
 or other action, replace itself as conservator with itself as receiver of
 such institution.
 `(B) REPLACEMENT TREATED AS REMOVAL OF INCUMBENT- The replacement of a
 conservator with a receiver under subparagraph (A) shall be treated as the
 removal of the Corporation as conservator.
 `(C) RIGHT OF REVIEW OF ORIGINAL APPOINTMENT NOT AFFECTED- The replacement
 of a conservator with a receiver under subparagraph (A) shall not affect
 any right of the insured State depository institution to obtain review,
 pursuant to paragraph (7), of the original appointment of the conservator.
 `(9) ADDITIONAL POWERS- In any case in which the Corporation is appointed
 conservator or receiver pursuant to paragraph (4) or (6)--
 `(A) the provisions of this section shall be applicable to the Corporation,
 as conservator or receiver of any insured State depository institution
 in the same manner and to the same extent as if such institution were a
 Federal depository institution for which the Corporation had been appointed
 conservator or receiver; and
 `(B) the Corporation as receiver of any insured State depository institution
 may--
 `(i) liquidate such institution in an orderly manner; and
 `(ii) make such other disposition of any matter concerning such institution
 as the Corporation determines is in the best interests of the institution,
 the depositors of such institution, and the Corporation.
 `(d) POWERS AND DUTIES OF CORPORATION AS CONSERVATOR OR RECEIVER-
 `(1) RULEMAKING AUTHORITY OF CORPORATION- The Corporation may prescribe
 such regulations as the Corporation determines to be appropriate regarding
 the conduct of conservatorships or receiverships.
 `(2) GENERAL POWERS-
 `(A) SUCCESSOR TO INSTITUTION- The Corporation shall, as conservator or
 receiver, and by operation of law, succeed to--
 `(i) all rights, titles, powers, and privileges of the insured depository
 institution, and of any stockholder, member, accountholder, depositor,
 officer, or director of such institution with respect to the institution
 and the assets of the institution; and
 `(ii) title to the books, records, and assets of any previous conservator
 or other legal custodian of such institution.
 `(B) OPERATE THE INSTITUTION- The Corporation may, as conservator or
 receiver--
 `(i) take over the assets of and operate the insured depository institution
 with all the powers of the members or shareholders, the directors, and the
 officers of the institution and conduct all business of the institution;
 `(ii) collect all obligations and money due the institution;
 `(iii) perform all functions of the institution in the name of the institution
 which is consistent with the appointment as conservator or receiver; and
 `(iv) preserve and conserve the assets and property of such institution.
 `(C) FUNCTIONS OF INSTITUTION'S OFFICERS, DIRECTORS, AND SHAREHOLDERS-
 The Corporation may, by regulation or order, provide for the exercise of
 any function by any member or stockholder, director, or officer of any
 insured depository institution for which the Corporation has been appointed
 conservator or receiver.
 `(D) POWERS AS CONSERVATOR- The Corporation may, as conservator, take such
 action as may be--
 `(i) necessary to put the insured depository institution in a sound and
 solvent condition; and
 `(ii) appropriate to carry on the business of the institution and preserve
 and conserve the assets and property of the institution.
 `(E) ADDITIONAL POWERS AS RECEIVER- The Corporation may, as receiver, place
 the insured depository institution in liquidation and proceed to realize
 upon the assets of the institution, having due regard to the conditions of
 credit in the locality.
 `(F) ORGANIZATION OF NEW INSTITUTIONS- The Corporation may, as receiver--
 `(i) with respect to savings associations and by application to the
 Director of the Office of Thrift Supervision, organize a new Federal savings
 association to take over such assets or such liabilities as the Corporation
 may determine to be appropriate; and
 `(ii) with respect to any insured bank, organize a new national bank under
 subsection (m) or a bridge bank under subsection (n).
 `(G) MERGER; TRANSFER OF ASSETS AND LIABILITIES-
 `(i) IN GENERAL- The Corporation may, as conservator or receiver--
 `(I) merge the insured depository institution with another insured depository
 institution; or
 `(II) subject to clause (ii), transfer any asset or liability of the
 institution in default (including assets and liabilities associated with any
 trust business) without any approval, assignment, or consent with respect
 to such transfer.
 `(ii) APPROVAL BY APPROPRIATE FEDERAL BANKING AGENCY- No transfer described in
 clause (i)(II) may be made to another depository institution (other than a new
 bank or a bridge bank established pursuant to subsection (m) or (n)) without
 the approval of the appropriate Federal banking agency for such institution.
 `(H) PAYMENT OF VALID OBLIGATIONS- The Corporation, as conservator or
 receiver, shall pay all valid obligations of the insured depository
 institution in accordance with the prescriptions and limitations of this Act.
 `(I) INCIDENTAL POWERS- The Corporation may, as conservator or receiver--
 `(i) exercise all powers and authorities specifically granted to conservators
 or receivers, respectively, under this Act and such incidental powers as
 shall be necessary to carry out such powers; and
 `(ii) take any action authorized by this Act,
which the Corporation determines is in the best interests of the depository
institution, its depositors, or the Corporation.
 `(3) AUTHORITY OF RECEIVER TO DETERMINE CLAIMS-
 `(A) IN GENERAL- The Corporation may, as receiver, determine claims
 in accordance with the requirements of this subsection and regulations
 prescribed under paragraph (4)(A).
 `(B) NOTICE REQUIREMENTS- The receiver, in any case involving the liquidation
 or winding up of the affairs of a closed depository institution, shall--
 `(i) promptly publish a notice to the depository institution's creditors
 to present their claims, together with proof, to the receiver by a date
 specified in the notice which shall be not less than 90 days after the
 publication of such notice; and
 `(ii) republish such notice approximately 1 month and 2 months, respectively,
 after the publication under clause (i).
 `(C) MAILING REQUIRED- The receiver shall mail a notice similar to the
 notice published under subparagraph (B)(i) at the time of such publication
 to any creditor shown on the institution's books--
 `(i) at the creditor's last address appearing in such books; or
 `(ii) upon discovery of the name and address of a claimant not appearing
 on the institution's books within 30 days after the discovery of such name
 and address.
 `(4) RULEMAKING AUTHORITY RELATING TO DETERMINATION OF CLAIMS- The Corporation
 may prescribe regulations regarding the allowance or disallowance of claims
 by the receiver and providing for administrative determination of claims
 and review of such determination.
 `(5) PROCEDURES FOR DETERMINATION OF CLAIMS-
 `(A) DETERMINATION PERIOD-
 `(i) IN GENERAL- Before the end of the 180-day period beginning on the date
 any claim against a depository institution is filed with the Corporation
 as receiver, the Corporation shall determine whether to allow or disallow
 the claim and shall notify the claimant of any determination with respect
 to such claim.
 `(ii) EXTENSION OF TIME- The period described in clause (i) may be extended
 by a written agreement between the claimant and the Corporation.
 `(iii) MAILING OF NOTICE SUFFICIENT- The requirements of clause (i) shall
 be deemed to be satisfied if the notice of any determination with respect
 to any claim is mailed to the last address of the claimant which appears--
 `(I) on the depository institution's books;
 `(II) in the claim filed by the claimant; or
 `(III) in documents submitted in proof of the claim.
 `(iv) CONTENTS OF NOTICE OF DISALLOWANCE- If any claim filed under clause
 (i) is disallowed, the notice to the claimant shall contain--
 `(I) a statement of each reason for the disallowance; and
 `(II) the procedures available for obtaining agency review of the
 determination to disallow the claim or judicial determination of the claim.
 `(B) ALLOWANCE OF PROVEN CLAIMS- The receiver shall allow any claim
 received on or before the date specified in the notice published under
 paragraph (3)(B)(i) by the receiver from any claimant which is proved to
 the satisfaction of the receiver.
 `(C) DISALLOWANCE OF CLAIMS FILED AFTER END OF FILING PERIOD-
 `(i) IN GENERAL- Except as provided in clause (ii), claims filed after the
 date specified in the notice published under paragraph (3)(B)(i) shall be
 disallowed and such disallowance shall be final.
 `(ii) CERTAIN EXCEPTIONS- Clause (i) shall not apply with respect to any claim
 filed by any claimant after the date specified in the notice published under
 paragraph (3)(B)(i) and such claim may be considered by the receiver if--
 `(I) the claimant did not receive notice of the appointment of the receiver
 in time to file such claim before such date; and
 `(II) such claim is filed in time to permit payment of such claim.
 `(D) AUTHORITY TO DISALLOW CLAIMS- The receiver may disallow any portion
 of any claim by a creditor or claim of security, preference, or priority
 which is not proved to the satisfaction of the receiver.
 `(E) NO JUDICIAL REVIEW OF DETERMINATION PURSUANT TO SUBPARAGRAPH (D)- No
 court may review the Corporation's determination pursuant to subparagraph
 (D) to disallow a claim.
 `(F) LEGAL EFFECT OF FILING-
 `(i) STATUTE OF LIMITATION TOLLED- For purposes of any applicable statute
 of limitations, the filing of a claim with the receiver shall constitute
 a commencement of an action.
 `(ii) NO PREJUDICE TO OTHER ACTIONS- Subject to paragraph (12), the filing
 of a claim with the receiver shall not prejudice any right of the claimant
 to continue any action which was filed before the appointment of the receiver.
 `(6) PROVISION FOR AGENCY REVIEW OR JUDICIAL DETERMINATION OF CLAIMS-
 `(A) IN GENERAL- Before the end of the 60-day period beginning on the
 earlier of--
 `(i) the end of the period described in paragraph (5)(A)(i) with respect
 to any claim against a depository institution for which the Corporation is
 receiver; or
 `(ii) the date of any notice of disallowance of such claim pursuant to
 paragraph (5)(A)(i),
the claimant may request administrative review of the claim in accordance
with subparagraph (A) or (B) of paragraph (7) or file suit on such claim
(or continue an action commenced before the appointment of the receiver)
in the district or territorial court of the United States for the district
within which the depository institution's principal place of business is
located or the United States District Court for the District of Columbia
(and such court shall have jurisdiction to hear such claim).
 `(B) STATUTE OF LIMITATIONS- If any claimant fails to--
 `(i) request administrative review of any claim in accordance with
 subparagraph (A) or (B) of paragraph (7); or
 `(ii) file suit on such claim (or continue an action commenced before the
 appointment of the receiver),
before the end of the 60-day period described in subparagraph (A), the claim
shall be deemed to be disallowed (other than any portion of such claim which
was allowed by the receiver) as of the end of such period, such disallowance
shall be final, and the claimant shall have no further rights or remedies
with respect to such claim.
 `(7) REVIEW OF CLAIMS-
 `(A) ADMINISTRATIVE HEARING- If any claimant requests review under this
 subparagraph in lieu of filing or continuing any action under paragraph (6)
 and the Corporation agrees to such request, the Corporation shall consider the
 claim after opportunity for a hearing on the record. The final determination
 of the Corporation with respect to such claim shall be subject to judicial
 review under chapter 7 of title 5, United States Code.
 `(B) OTHER REVIEW PROCEDURES-
 `(i) IN GENERAL- The Corporation shall also establish such alternative
 dispute resolution processes as may be appropriate for the resolution of
 claims filed under paragraph (5)(A)(i).
 `(ii) CRITERIA- In establishing alternative dispute resolution processes,
 the Corporation shall strive for procedures which are expeditious, fair,
 independent, and low cost.
 `(iii) VOLUNTARY BINDING OR NONBINDING PROCEDURES- The Corporation may
 establish both binding and nonbinding processes, which may be conducted by
 any government or private party, but all parties, including the claimant and
 the Corporation, must agree to the use of the process in a particular case.
 `(iv) CONSIDERATION OF INCENTIVES- The Corporation shall seek to develop
 incentives for claimants to participate in the alternative dispute resolution
 process.
 `(8) EXPEDITED DETERMINATION OF CLAIMS-
 `(A) ESTABLISHMENT REQUIRED- The Corporation shall establish a procedure
 for expedited relief outside of the routine claims process established
 under paragraph (5) for claimants who--
 `(i) allege the existence of legally valid and enforceable or perfected
 security interests in assets of any depository institution for which the
 Corporation has been appointed receiver; and
 `(ii) allege that irreparable injury will occur if the routine claims
 procedure is followed.
 `(B) DETERMINATION PERIOD- Before the end of the 90-day period beginning on
 the date any claim is filed in accordance with the procedures established
 pursuant to subparagraph (A), the Corporation shall--
 `(i) determine--
 `(I) whether to allow or disallow such claim; or
 `(II) whether such claim should be determined pursuant to the procedures
 established pursuant to paragraph (5); and
 `(ii) notify the claimant of the determination, and if the claim is
 disallowed, a statement of each reason for the disallowance and the procedure
 for obtaining agency review or judicial determination.
 `(C) PERIOD FOR FILING OR RENEWING SUIT- Any claimant who files a request
 for expedited relief shall be permitted to file a suit, or to continue a
 suit filed before the appointment of the receiver, seeking a determination
 of the claimant's rights with respect to such security interest after the
 earlier of--
 `(i) the end of the 90-day period beginning on the date of the filing of
 a request for expedited relief; or
 `(ii) the date the Corporation denies the claim.
 `(D) STATUTE OF LIMITATIONS- If an action described in subparagraph
 (C) is not filed, or the motion to renew a previously filed suit is not
 made, before the end of the 30-day period beginning on the date on which
 such action or motion may be filed in accordance with subparagraph (B),
 the claim shall be deemed to be disallowed as of the end of such period
 (other than any portion of such claim which was allowed by the receiver),
 such disallowance shall be final, and the claimant shall have no further
 rights or remedies with respect to such claim.
 `(E) LEGAL EFFECT OF FILING-
 `(i) STATUTE OF LIMITATION TOLLED- For purposes of any applicable statute
 of limitations, the filing of a claim with the receiver shall constitute
 a commencement of an action.
 `(ii) NO PREJUDICE TO OTHER ACTIONS- Subject to paragraph (12), the filing
 of a claim with the receiver shall not prejudice any right of the claimant
 to continue any action which was filed before the appointment of the receiver.
 `(9) AGREEMENT AS BASIS OF CLAIM-
 `(A) REQUIREMENTS- Except as provided in subparagraph (B), any agreement
 which does not meet the requirements set forth in section 13(e) shall not
 form the basis of, or substantially comprise, a claim against the receiver
 or the Corporation.
 `(B) EXCEPTION TO CONTEMPORANEOUS EXECUTION REQUIREMENT- Notwithstanding
 section 13(e)(2), any agreement relating to an extension of credit between
 a Federal home loan bank or Federal Reserve bank and any insured depository
 institution which was executed before the extension of credit by such bank to
 such institution shall be treated as having been executed contemporaneously
 with such extension of credit for purposes of subparagraph (A).
 `(10) PAYMENT OF CLAIMS-
 `(A) IN GENERAL- The receiver may, in the receiver's discretion and to
 the extent funds are available, pay creditor claims which are allowed by
 the receiver, approved by the Corporation pursuant to a final determination
 pursuant to paragraph (7) or (8), or determined by the final judgment of any
 court of competent jurisdiction in such manner and amounts as are authorized
 under this Act.
 `(B) PAYMENT OF DIVIDENDS ON CLAIMS- The receiver may, in the receiver's sole
 discretion, pay dividends on proved claims at any time, and no liability
 shall attach to the Corporation (in such Corporation's corporate capacity
 or as receiver), by reason of any such payment, for failure to pay dividends
 to a claimant whose claim is not proved at the time of any such payment.
 `(11) DISTRIBUTION OF ASSETS-
 `(A) SUBROGATED CLAIMS; CLAIMS OF UNINSURED DEPOSITORS AND OTHER CREDITORS-
 The receiver shall--
 `(i) retain for the account of the Corporation such portion of the amounts
 realized from any liquidation as the Corporation may be entitled to receive
 in connection with the subrogation of the claims of depositors; and
 `(ii) pay to depositors and other creditors the net amounts available for
 distribution to them.
 `(B) DISTRIBUTION TO SHAREHOLDERS OF AMOUNTS REMAINING AFTER PAYMENT OF
 ALL OTHER CLAIMS AND EXPENSES- In any case in which funds remain after all
 depositors, creditors, other claimants, and administrative expenses are paid,
 the receiver shall distribute such funds to the depository institution's
 shareholders or members together with the accounting report required under
 paragraph (14)(C).
 `(12) SUSPENSION OF LEGAL ACTIONS-
 `(A) IN GENERAL- After the appointment of a conservator or receiver for an
 insured depository institution, the conservator or receiver may request a
 stay for a period not to exceed--
 `(i) 45 days, in the case of any conservator; and
 `(ii) 90 days, in the case of any receiver,
in any judicial action or proceeding to which such institution is or becomes
a party.
 `(B) GRANT OF STAY BY ALL COURTS REQUIRED- Upon receipt of a request by
 any conservator or receiver pursuant to subparagraph (A) for a stay of any
 judicial action or proceeding in any court with jurisdiction of such action
 or proceeding, the court shall grant such stay as to all parties.
 `(13) ADDITIONAL RIGHTS AND DUTIES-
 `(A) PRIOR FINAL ADJUDICATION- The Corporation shall abide by any final
 unappealable judgment of any court of competent jurisdiction which was
 rendered before the appointment of the Corporation as conservator or receiver.
 `(B) RIGHTS AND REMEDIES OF CONSERVATOR OR RECEIVER- In the event of any
 appealable judgment, the Corporation as conservator or receiver shall--
 `(i) have all the rights and remedies available to the insured depository
 institution (before the appointment of such conservator or receiver) and
 the Corporation in its corporate capacity, including removal to Federal
 court and all appellate rights; and
 `(ii) not be required to post any bond in order to pursue such remedies.
 `(C) NO ATTACHMENT OR EXECUTION- No attachment or execution may issue by
 any court upon assets in the possession of the receiver.
 `(D) LIMITATION ON JUDICIAL REVIEW- Except as otherwise provided in this
 subsection, no court shall have jurisdiction over--
 `(i) any claim or action for payment from, or any action seeking a
 determination of rights with respect to, the assets of any depository
 institution for which the Corporation has been appointed receiver, including
 assets which the Corporation may acquire from itself as such receiver; or
 `(ii) any claim relating to any act or omission of such institution or the
 Corporation as receiver.
 `(14) STATUTE OF LIMITATIONS FOR ACTIONS BROUGHT BY CONSERVATOR OR RECEIVER-
 `(A) IN GENERAL- Notwithstanding any provision of any contract, the applicable
 statute of limitations with regard to any action brought by the Corporation
 as conservator or receiver shall be--
 `(i) in the case of any contract claim, the longer of--
 `(I) the 6-year period beginning on the date the claim accrues; or
 `(II) the period applicable under State law; and
 `(ii) in the case of any tort claim, the longer of--
 `(I) the 3-year period beginning on the date the claim accrues; or
 `(II) the period applicable under State law.
 `(B) DETERMINATION OF THE DATE ON WHICH A CLAIM ACCRUES- For purposes of
 subparagraph (A), the date on which the statute of limitation begins to
 run on any claim described in such subparagraph shall be the later of--
 `(i) the date of the appointment of the Corporation as conservator or
 receiver; or
 `(ii) the date on which the cause of action accrues.
 `(15) ACCOUNTING AND RECORDKEEPING REQUIREMENTS-
 `(A) IN GENERAL- The Corporation as conservator or receiver shall, consistent
 with the accounting and reporting practices and procedures established by
 the Corporation, maintain a full accounting of each conservatorship and
 receivership or other disposition of institutions in default.
 `(B) ANNUAL ACCOUNTING OR REPORT- With respect to each conservatorship
 or receivership to which the Corporation was appointed, the Corporation
 shall make an annual accounting or report, as appropriate, available to the
 Secretary of the Treasury, the Comptroller General of the United States,
 and the authority which appointed the Corporation as conservator or receiver.
 `(C) AVAILABILITY OF REPORTS- Any report prepared pursuant to subparagraph (B)
 shall be made available by the Corporation upon request to any shareholder
 of the depository institution for which the Corporation was appointed
 conservator or receiver or any other member of the public.
 `(D) RECORDKEEPING REQUIREMENT- After the end of the 6-year period beginning
 on the date the Corporation is appointed as receiver of an insured depository
 institution, the Corporation may destroy any records of such institution
 which the Corporation, in the Corporation's discretion, determines to be
 unnecessary unless directed not to do so by a court of competent jurisdiction
 or governmental agency, or prohibited by law.
 `(16) CONTRACTS WITH STATE HOUSING FINANCE AUTHORITIES-
 `(A) IN GENERAL- The Corporation may enter into contracts with any State
 housing finance authority for the sale of mortgage-related assets (as such
 terms are defined in section 1301 of the Financial Institutions Reform,
 Recovery, and Enforcement Act of 1989) of any depository institution
 in default (including assets and liabilities associated with any trust
 business), such contracts to be effective in accordance with their terms
 without any further approval, assignment, or consent with respect thereto.
 `(B) FACTORS TO CONSIDER- In evaluating the disposition of mortgage related
 assets to any State housing finance authority the Corporation shall consider--
 `(i) the State housing finance authority's ability to acquire and service
 current, delinquent, and defaulted mortgage related assets;
 `(ii) the State housing finance authority's ability to further national
 housing policies;
 `(iii) the State housing finance authority's sensitivity to the impact of
 the sale of mortgage related assets upon the State and local communities;
 `(iv) the costs to the Federal Government associated with alternative
 ownership or dispositions of the mortgage related assets;
 `(v) the minimization of future guaranties which may be required of the
 Federal Government;
 `(vi) the maximization of mortgage related asset values; and
 `(vii) the utilization of institutions currently established in mortgage
 related asset market activities.
 `(e) PROVISIONS RELATING TO CONTRACTS ENTERED INTO BEFORE APPOINTMENT OF
 CONSERVATOR OR RECEIVER-
 `(1) AUTHORITY TO REPUDIATE CONTRACTS- In addition to any other rights a
 conservator or receiver may have, the conservator or receiver for any insured
 depository institution may disaffirm or repudiate any contract or lease--
 `(A) to which such institution is a party;
 `(B) the performance of which the conservator or receiver, in the
 conservator's or receiver's discretion, determines to be burdensome; and
 `(C) the disaffirmance or repudiation of which the conservator or receiver
 determines, in the conservator's or receiver's discretion, will promote
 the orderly administration of the institution's affairs.
 `(2) TIMING OF REPUDIATION- The conservator or receiver appointed for any
 insured depository institution in accordance with subsection (c) shall
 determine whether or not to exercise the rights of repudiation under this
 subsection within a reasonable period following such appointment.
 `(3) CLAIMS FOR DAMAGES FOR REPUDIATION-
 `(A) IN GENERAL- Except as otherwise provided in subparagraph (C) and
 paragraphs (4), (5), and (6), the liability of the conservator or receiver
 for the disaffirmance or repudiation of any contract pursuant to paragraph
 (1) shall be--
 `(i) limited to actual direct compensatory damages; and
 `(ii) determined as of--
 `(I) the date of the appointment of the conservator or receiver; or
 `(II) in the case of any contract or agreement referred to in paragraph (8),
 the date of the disaffirmance or repudiation of such contract or agreement.
 `(B) NO LIABILITY FOR OTHER DAMAGES- For purposes of subparagraph (A),
 the term `actual direct compensatory damages' does not include--
 `(i) punitive or exemplary damages;
 `(ii) damages for lost profits or opportunity; or
 `(iii) damages for pain and suffering.
 `(C) MEASURE OF DAMAGES FOR REPUDIATION OF FINANCIAL CONTRACTS- In the
 case of any qualified financial contract or agreement to which paragraph
 (8) applies, compensatory damages shall be--
 `(i) deemed to include normal and reasonable costs of cover or other
 reasonable measures of damages utilized in the industries for such contract
 and agreement claims; and
 `(ii) paid in accordance with this subsection and subsection (k) except as
 otherwise specifically provided in this section.
 `(4) LEASES UNDER WHICH THE INSTITUTION IS THE LESSEE-
 `(A) IN GENERAL- If the conservator or receiver disaffirms or repudiates a
 lease under which the insured depository institution was the lessee, the
 conservator or receiver shall not be liable for any damages (other than
 damages determined pursuant to subparagraph (B)) for the disaffirmance or
 repudiation of such lease.
 `(B) PAYMENTS OF RENT- Notwithstanding subparagraph (A), the lessor under
 a lease to which such subparagraph applies shall--
 `(i) be entitled to the contractual rent accruing before the later of
 the date--
 `(I) the notice of disaffirmance or repudiation is mailed; or
 `(II) the disaffirmance or repudiation becomes effective,
unless the lessor is in default or breach of the terms of the lease;
 `(ii) have no claim for damages under any acceleration clause or other
 penalty provision in the lease; and
 `(iii) have a claim for any unpaid rent, subject to all appropriate offsets
 and defenses, due as of the date of the appointment which shall be paid in
 accordance with this subsection and subsection (k).
 `(5) LEASES UNDER WHICH THE INSTITUTION IS THE LESSOR-
 `(A) IN GENERAL- If the conservator or receiver repudiates an unexpired
 written lease of real property of the insured depository institution under
 which the institution is the lessor and the lessee is not, as of the date
 of such repudiation, in default, the lessee under such lease may either--
 `(i) treat the lease as terminated by such repudiation; or
 `(ii) remain in possession of the leasehold interest for the balance of the
 term of the lease unless the lessee defaults under the terms of the lease
 after the date of such repudiation.
 `(B) PROVISIONS APPLICABLE TO LESSEE REMAINING IN POSSESSION- If any lessee
 under a lease described in subparagraph (A) remains in possession of a
 leasehold interest pursuant to clause (ii) of such subparagraph--
 `(i) the lessee--
 `(I) shall continue to pay the contractual rent pursuant to the terms of
 the lease after the date of the repudiation of such lease;
 `(II) may offset against any rent payment which accrues after the date of
 the repudiation of the lease, any damages which accrue after such date due
 to the nonperformance of any obligation of the insured depository institution
 under the lease after such date; and
 `(ii) the conservator or receiver shall not be liable to the lessee for
 any damages arising after such date as a result of the repudiation other
 than the amount of any offset allowed under clause (i)(II).
 `(6) CONTRACTS FOR THE SALE OF REAL PROPERTY-
 `(A) IN GENERAL- If the conservator or receiver repudiates any contract
 (which meets the requirements of each paragraph of section 13(e)) for the
 sale of real property and the purchaser of such real property under such
 contract is in possession and is not, as of the date of such repudiation,
 in default, such purchaser may either--
 `(i) treat the contract as terminated by such repudiation; or
 `(ii) remain in possession of such real property.
 `(B) PROVISIONS APPLICABLE TO PURCHASER REMAINING IN POSSESSION- If any
 purchaser of real property under any contract described in subparagraph
 (A) remains in possession of such property pursuant to clause (ii) of such
 subparagraph--
 `(i) the purchaser--
 `(I) shall continue to make all payments due under the contract after the
 date of the repudiation of the contract; and
 `(II) may offset against any such payments any damages which accrue after
 such date due to the nonperformance (after such date) of any obligation of
 the depository institution under the contract; and
 `(ii) the conservator or receiver shall--
 `(I) not be liable to the purchaser for any damages arising after such date
 as a result of the repudiation other than the amount of any offset allowed
 under clause (i)(II);
 `(II) deliver title to the purchaser in accordance with the provisions of
 the contract; and
 `(III) have no obligation under the contract other than the performance
 required under subclause (II).
 `(C) ASSIGNMENT AND SALE ALLOWED-
 `(i) IN GENERAL- No provision of this paragraph shall be construed as
 limiting the right of the conservator or receiver to assign the contract
 described in subparagraph (A) and sell the property subject to the contract
 and the provisions of this paragraph.
 `(ii) NO LIABILITY AFTER ASSIGNMENT AND SALE- If an assignment and sale
 described in clause (i) is consummated, the conservator or receiver shall
 have no further liability under the contract described in subparagraph (A)
 or with respect to the real property which was the subject of such contract.
 `(7) PROVISIONS APPLICABLE TO SERVICE CONTRACTS-
 `(A) SERVICES PERFORMED BEFORE APPOINTMENT- In the case of any contract
 for services between any person and any insured depository institution
 for which the Corporation has been appointed conservator or receiver, any
 claim of such person for services performed before the appointment of the
 conservator or the receiver shall be--
 `(i) a claim to be paid in accordance with subsections (d) and (i); and
 `(ii) deemed to have arisen as of the date the conservator or receiver
 was appointed.
 `(B) SERVICES PERFORMED AFTER APPOINTMENT AND PRIOR TO REPUDIATION- If,
 in the case of any contract for services described in subparagraph (A),
 the conservator or receiver accepts performance by the other person before
 the conservator or receiver makes any determination to exercise the right
 of repudiation of such contract under this section--
 `(i) the other party shall be paid under the terms of the contract for the
 services performed; and
 `(ii) the amount of such payment shall be treated as an administrative
 expense of the conservatorship or receivership.
 `(C) ACCEPTANCE OF PERFORMANCE NO BAR TO SUBSEQUENT REPUDIATION- The
 acceptance by any conservator or receiver of services referred to in
 subparagraph (B) in connection with a contract described in such subparagraph
 shall not affect the right of the conservator or receiver to repudiate such
 contract under this section at any time after such performance.
 `(8) CERTAIN QUALIFIED FINANCIAL CONTRACTS-
 `(A) RIGHTS OF PARTIES TO CONTRACTS- Subject to paragraph (10) of this
 subsection and notwithstanding any other provision of this Act (other than
 subsections (d)(9) and (i)(4)(I) of this section and section 13(e)), any
 other Federal law, or the law of any State, no person shall be stayed or
 prohibited from exercising--
 `(i) any right to cause the termination or liquidation of any qualified
 financial contract with an insured depository institution which arises upon
 the appointment of the Corporation as receiver for such institution at any
 time after such appointment;
 `(ii) any right under any security arrangement relating to any contract or
 agreement described in clause (i); or
 `(iii) any right to offset or net out any termination value, payment amount,
 or other transfer obligation arising under or in connection with 1 or more
 contracts and agreements described in clause (i), including any master
 agreement for such contracts or agreements.
 `(B) APPLICABILITY OF OTHER PROVISIONS- Subsection (d)(12) shall apply in
 the case of any judicial action or proceeding brought against any receiver
 referred to in subparagraph (A), or the insured depository institution for
 which such receiver was appointed, by any party to a contract or agreement
 described in subparagraph (A)(i) with such institution.
 `(C) CERTAIN TRANSFERS NOT AVOIDABLE-
 `(i) IN GENERAL- Notwithstanding paragraph (11), the Corporation, whether
 acting as such or as conservator or receiver of an insured depository
 institution, may not avoid any transfer of money or other property in
 connection with any qualified financial contract with an insured depository
 institution.
 `(ii) EXCEPTION FOR CERTAIN TRANSFERS- Clause (i) shall not apply to
 any transfer of money or other property in connection with any qualified
 financial contract with an insured depository institution if the Corporation
 determines that the transferee had actual intent to hinder, delay, or defraud
 such institution, the creditors of such institution, or any conservator or
 receiver appointed for such institution.
 `(D) CERTAIN CONTRACTS AND AGREEMENTS DEFINED- For purposes of this
 subsection--
 `(i) QUALIFIED FINANCIAL CONTRACT- The term `qualified financial contract'
 means any securities contract, commodity contract, forward contract,
 repurchase agreement, swap agreement, and any similar agreement that the
 Corporation determines by regulation to be a qualified financial contract
 for purposes of this paragraph.
 `(ii) SECURITIES CONTRACT- The term `securities contract'--
 `(I) has the meaning given to such term in section 741(7) of title 11,
 United States Code, except that the term `security' (as used in such section)
 shall be deemed to include any mortgage loan, any mortgage-related security
 (as defined in section 3(a)(41) of the Securities Exchange Act of 1934),
 and any interest in any mortgage loan or mortgage-related security; and
 `(II) does not include any participation in a commercial mortgage loan
 unless the Corporation determines by regulation, resolution, or order to
 include any such participation within the meaning of such term.
 `(iii) COMMODITY CONTRACT- The term `commodity contract' has the meaning
 given to such term in section 761(4) of title 11, United States Code.
 `(iv) FORWARD CONTRACT- The term `forward contract' has the meaning given
 to such term in section 101(24) of title 11, United States Code.
 `(v) REPURCHASE AGREEMENT- The term `repurchase agreement'--
 `(I) has the meaning given to such term in section 101(41) of title 11, the
 United States Code, except that the items (as described in such section)
 which may be subject to any such agreement shall be deemed to include
 mortgage-related securities (as such term is defined in section 3(a)(41)
 of the Securities Exchange Act of 1934, any mortgage loan, and any interest
 in any mortgage loan; and
 `(II) does not include any participation in a commercial mortgage loan
 unless the Corporation determines by regulation, resolution, or order to
 include any such participation within the meaning of such term.
 `(vi) SWAP AGREEMENT- The term `swap agreement'--
 `(I) means any agreement, including the terms and conditions incorporated by
 reference in any such agreement, which is a rate swap agreement, basis swap,
 commodity swap, forward rate agreement, interest rate future, interest rate
 option purchased, forward foreign exchange agreement, rate cap agreement,
 rate floor agreement, rate collar agreement, currency swap agreement,
 cross-currency rate swap agreement, currency future, or currency option
 purchased or any other similar agreement, and
 `(II) includes any combination of such agreements and any option to enter
 into any such agreement.
 `(vii) TREATMENT OF MASTER AGREEMENT AS 1 SWAP AGREEMENT- Any master agreement
 for any agreements described in clause (vi)(I) together with all supplements
 to such master agreement shall be treated as 1 swap agreement.
 `(viii) TRANSFER- The term `transfer' has the meaning given to such term
 in section 101(50) of title 11, United States Code.
 `(E) CERTAIN PROTECTIONS IN EVENT OF APPOINTMENT OF CONSERVATOR-
 Notwithstanding any other provision of this Act (other than paragraph (12)
 of this subsection, subsections (d)(9) and (i)(4)(I) of this section, and
 section 13(e) of this Act), any other Federal law, or the law of any State,
 no person shall be stayed or prohibited from exercising--
 `(i) any right such person has to cause the termination, liquidation,
 or acceleration of any qualified financial contract with a depository
 institution in a conservatorship based upon a default under such financial
 contract which is enforceable under applicable noninsolvency law;
 `(ii) any right under any security arrangement relating to such qualified
 financial contracts; or
 `(iii) any right to offset or net out any termination values, payment
 amounts, or other transfer obligations arising under or in connection with
 such qualified financial contracts.
 `(9) TRANSFER OF QUALIFIED FINANCIAL CONTRACTS- In making any transfer of
 assets or liabilities of a depository institution in default which includes
 any qualified financial contract, the conservator or receiver for such
 depository institution shall either--
 `(A) transfer to 1 depository institution (other than a depository institution
 in default)--
 `(i) all qualified financial contracts between--
 `(I) any person or any affiliate of such person; and
 `(II) the depository institution in default;
 `(ii) all claims of such person or any affiliate of such person against
 such depository institution under any such contract (other than any claim
 which, under the terms of any such contract, is subordinated to the claims
 of general unsecured creditors of such institution);
 `(iii) all claims of such depository institution against such person or
 any affiliate of such person under any such contract; and
 `(iv) all property securing any claim described in clause (ii) or (iii)
 under any such contract; or
 `(B) transfer none of the financial contracts, claims, or property referred
 to in subparagraph (A) (with respect to such person and any affiliate of
 such person).
 `(10) NOTIFICATION OF TRANSFER-
 `(A) IN GENERAL- If--
 `(i) the conservator or receiver for an insured depository institution
 in default makes any transfer of the assets and liabilities of such
 institution; and
 `(ii) the transfer includes any qualified financial contract,
the conservator or receiver shall use such conservator's or receiver's
best efforts to notify any person who is a party to any such contract of
such transfer by 12:00, noon (local time) on the business day following
such transfer.
 `(B) BUSINESS DAY DEFINED- For purposes of this paragraph, the term `business
 day' means any day other than any Saturday, Sunday, or any day on which either
 the New York Stock Exchange or the Federal Reserve Bank of New York is closed.
 `(11) CERTAIN SECURITY INTERESTS NOT AVOIDABLE- No provision of
 this subsection shall be construed as permitting the avoidance of any
 legally enforceable or perfected security interest in any of the assets
 of any depository institution except where such an interest is taken in
 contemplation of the institution's insolvency or with the intent to hinder,
 delay, or defraud the institution or the creditors of such institution.
 `(12) AUTHORITY TO ENFORCE CONTRACTS-
 `(A) IN GENERAL- The conservator or receiver may enforce any contract,
 other than a director's or officer's liability insurance contract or a
 depository institution bond, entered into by the depository institution
 notwithstanding any provision of the contract providing for termination,
 default, acceleration, or exercise of rights upon, or solely by reason of,
 insolvency or the appointment of a conservator or receiver.
 `(B) CERTAIN RIGHTS NOT AFFECTED- No provision of this paragraph may be
 construed as impairing or affecting any right of the conservator or receiver
 to enforce or recover under a directors or officers liability insurance
 contract or depository institution bond under other applicable law.
 `(13) EXCEPTION FOR FEDERAL RESERVE AND FEDERAL HOME LOAN BANKS- No provision
 of this subsection shall apply with respect to--
 `(A) any extension of credit from any Federal home loan bank or Federal
 Reserve bank to any insured depository institution; or
 `(B) any security interest in the assets of the institution securing any
 such extension of credit.
 `(f) PAYMENT OF INSURED DEPOSITS-
 `(1) IN GENERAL- In case of the liquidation of, or other closing or winding
 up of the affairs of, any insured depository institution, payment of the
 insured deposits in such institution shall be made by the Corporation as
 soon as possible, subject to the provisions of subsection (g), either by
 cash or by making available to each depositor a transferred deposit in
 a new insured depository institution in the same community or in another
 insured depository institution in an amount equal to the insured deposit
 of such depositor, except that--
 `(A) all payments made pursuant to this section on account of a closed Bank
 Insurance Fund member shall be made only from the Bank Insurance Fund, and
 `(B) all payments made pursuant to this section on account of a closed
 Savings Association Insurance Fund member shall be made only from the
 Savings Association Insurance Fund.
 `(2) PROOF OF CLAIMS- The Corporation, in its discretion, may require proof of
 claims to be filed and may approve or reject such claims for insured deposits.
 `(3) RESOLUTION OF DISPUTES-
 `(A) RESOLUTIONS IN ACCORDANCE TO CORPORATION REGULATIONS- In the case of
 any disputed claim relating to any insured deposit or any determination
 of insurance coverage with respect to any deposit, the Corporation may
 resolve such disputed claim in accordance with regulations prescribed by
 the Corporation establishing procedures for resolving such claims.
 `(B) ADJUDICATION OF CLAIMS- If the Corporation has not prescribed regulations
 establishing procedures for resolving disputed claims, the Corporation may
 require the final determination of a court of competent jurisdiction before
 paying any such claim.
 `(4) REVIEW OF CORPORATION'S DETERMINATION- Final determination made by the
 Corporation shall be reviewable in accordance with chapter 7 of title 5,
 United States Code, by the United States Court of Appeals for the District
 of Columbia or the court of appeals for the Federal judicial circuit where
 the principal place of business of the depository institution is located.
 `(5) STATUTE OF LIMITATIONS- Any request for review of a final determination
 by the Corporation shall be filed with the appropriate circuit court of
 appeals not later than 60 days after such determination is ordered.
 `(g) SUBROGATION OF CORPORATION-
 `(1) IN GENERAL- Notwithstanding any other provision of Federal law, the
 law of any State, or the constitution of any State, the Corporation, upon
 the payment to any depositor as provided in subsection (f) in connection
 with any insured depository institution or insured branch described in
 such subsection or the assumption of any deposit in such institution or
 branch by another insured depository institution pursuant to this section
 or section 13, shall be subrogated to all rights of the depositor against
 such institution or branch to the extent of such payment or assumption.
 `(2) DIVIDENDS ON SUBROGATED AMOUNTS- The subrogation of the Corporation
 under paragraph (1) with respect to any insured depository institution
 shall include the right on the part of the Corporation to receive the same
 dividends from the proceeds of the assets of such institution and recoveries
 on account of stockholders' liability as would have been payable to the
 depositor on a claim for the insured deposit, but such depositor shall
 retain such claim for any uninsured or unassumed portion of the deposit.
 `(3) WAIVER OF CERTAIN CLAIMS- With respect to any bank which closes after
 May 25, 1938, the Corporation shall waive, in favor only of any person
 against whom stockholders' individual liability may be asserted, any claim
 on account of such liability in excess of the liability, if any, to the
 bank or its creditors, for the amount unpaid upon such stock in such bank;
 but any such waiver shall be effected in such manner and on such terms and
 conditions as will not increase recoveries or dividends on account of claims
 to which the Corporation is not subrogated.
 `(4) APPLICABILITY OF STATE LAW- If the Corporation is appointed pursuant
 to subsection (c)(3), or determines not to invoke the authority conferred
 in subsection (c)(4), the rights of depositors and other creditors of any
 State depository institution shall be determined in accordance with the
 applicable provisions of State law.
 `(h) CONDITIONS APPLICABLE TO LIQUIDATION PROCEEDINGS-
 `(1) CONSIDERATION OF LOCAL ECONOMIC IMPACT REQUIRED- The Corporation shall
 fully consider the adverse economic impact on local communities, including
 businesses and farms, of actions to be taken by it during the administration
 and liquidation of loans of a depository institution in default.
 `(2) ACTIONS TO ALLEVIATE ADVERSE ECONOMIC IMPACT TO BE CONSIDERED- The
 actions which the Corporation shall consider include the release of proceeds
 from the sale of products and services for family living and business
 expenses and shortening the undue length of the decisionmaking process for
 the acceptance of offers of settlement contingent upon third party financing.
 `(3) GUIDELINES REQUIRED- The Corporation shall adopt and publish procedures
 and guidelines to minimize adverse economic effects caused by its actions
 on individual debtors in the community.
 `(i) Valuation of Claims in Default-
 `(1) IN GENERAL- Notwithstanding any other provision of Federal law or the law
 of any State and regardless of the method which the Corporation determines
 to utilize with respect to an insured depository institution in default or
 in danger of default, including transactions authorized under subsection (n)
 and section 13(c), this subsection shall govern the rights of the creditors
 (other than insured depositors) of such institution.
 `(2) MAXIMUM LIABILITY- The maximum liability of the Corporation, acting as
 receiver or in any other capacity, to any person having a claim against the
 receiver or the insured depository institution for which such receiver is
 appointed shall equal the amount such claimant would have received if the
 Corporation had liquidated the assets and liabilities of such institution
 without exercising the Corporation's authority under subsection (n) of this
 section or section 13.
 `(3) Additional payments authorized-
 `(A) IN GENERAL- The Corporation may, in its discretion and in the interests
 of minimizing its losses, use its own resources to make additional payments
 or credit additional amounts to or with respect to or for the account of any
 claimant or category of claimants. The Corporation shall not be obligated,
 as a result of having made any such payment or credited any such amount
 to or with respect to or for the account of any claimant or category of
 claimants, to make payments to any other claimant or category or claimants.
 `(B) SOURCE OF FUNDS- If the depository institution in default is a Bank
 Insurance Fund member, the Corporation may only make such payments out of
 funds held in the Bank Insurance Fund. If the depository institution in
 default is a Savings Association Insurance Fund member, the Corporation
 may only make such payments out of funds held in the Savings Association
 Insurance Fund.
 `(C) MANNER OF PAYMENT- The Corporation may make the payments or credit the
 amounts specified in subparagraphs (A) and (B) directly to the claimants or
 may make such payments or credit such amounts to an open insured depository
 institution to induce such institution to accept liability for such claims.
 `(j) LIMITATION ON COURT ACTION- Except as provided in this section, no
 court may take any action, except at the request of the Board of Directors
 by regulation or order, to restrain or affect the exercise of powers or
 functions of the Corporation as a conservator or a receiver.
 `(k) LIABILITY OF DIRECTORS AND OFFICERS- A director or officer of an insured
 depository institution may be held personally liable for monetary damages
 in any civil action by, on behalf of, or at the request or direction of
 the Corporation, which action is prosecuted wholly or partially for the
 benefit of the Corporation--
 `(1) acting as conservator or receiver of such institution,
 `(2) acting based upon a suit, claim, or cause of action purchased from,
 assigned by, or otherwise conveyed by such receiver or conservator, or
 `(3) acting based upon a suit, claim, or cause of action purchased from,
 assigned by, or otherwise conveyed in whole or in part by an insured
 depository institution or its affiliate in connection with assistance
 provided under section 13,
for gross negligence, including any similar conduct or conduct that
demonstrates a greater disregard of a duty of care (than gross negligence)
including intentional tortious conduct, as such terms are defined and
determined under applicable State law. Nothing in this paragraph shall impair
or affect any right of the Corporation under other applicable law.
 `(l) DAMAGES- In any proceeding related to any claim against an insured
 depository institution's director, officer, employee, agent, attorney,
 accountant, appraiser, or any other party employed by or providing services
 to an insured depository institution, recoverable damages determined to
 result from the improvident or otherwise improper use or investment of any
 insured depository institution's assets shall include principal losses and
 appropriate interest.'.
SEC. 213. NEW BANKS.
 Section 11 of the Federal Deposit Insurance Act (12 U.S.C. 1821) is amended
 by inserting after subsection (l) (as added by section 212) the following
 new subsection:
 `(m) NEW BANKS-
 `(1) ORGANIZATION AUTHORIZED- As soon as possible after the default of an
 insured bank, the Corporation, if it finds that it is advisable and in the
 interest of the depositors of the insured bank in default or the public
 shall organize a new national bank in the same community as the bank in
 default to assume the insured deposits of such bank in default and otherwise
 to perform temporarily the functions hereinafter provided for.
 `(2) ARTICLES OF ASSOCIATION- The articles of association and the organization
 certificate of the new bank shall be executed by representatives designated
 by the Corporation.
 `(3) CAPITAL STOCK- No capital stock need be paid in by the Corporation.
 `(4) EXECUTIVE OFFICER- The new bank shall not have a board of directors,
 but shall be managed by an executive officer appointed by the Board of
 Directors of the Corporation who shall be subject to its directions.
 `(5) SUBJECT TO LAWS RELATING TO NATIONAL BANKS- In all other respects the
 new bank shall be organized in accordance with the then existing provisions
 of law relating to the organization of national banking associations.
 `(6) NEW DEPOSITS- The new bank may, with the approval of the Corporation,
 accept new deposits which shall be subject to withdrawal on demand and
 which, except where the new bank is the only bank in the community, shall
 not exceed $100,000 from any depositor.
 `(7) INSURED STATUS- The new bank, without application to or approval by the
 Corporation, shall be an insured depository institution and shall maintain
 on deposit with the Federal Reserve bank of its district reserves in the
 amount required by law for member banks, but it shall not be required to
 subscribe for stock of the Federal Reserve bank.
 `(8) INVESTMENTS- Funds of the new bank shall be kept on hand in cash,
 invested in obligations of the United States or obligations guaranteed
 as to principal and interest by the United States, or deposited with the
 Corporation, any Federal Reserve bank, or, to the extent of the insurance
 coverage on any such deposit, an insured depository institution.
 `(9) CONDUCT OF BUSINESS- The new bank, unless otherwise authorized by the
 Comptroller of the Currency, shall transact business only as authorized by
 this Act and as may be incidental to its organization.
 `(10) EXEMPT STATUS- Notwithstanding any other provision of Federal or State
 law, the new bank, its franchise, property, and income shall be exempt from
 all taxation now or hereafter imposed by the United States, by any territory,
 dependency, or possession thereof, or by any State, county, municipality,
 or local taxing authority.
 `(11) TRANSFER OF DEPOSITS- (A) Upon the organization of a new bank,
 the Corporation shall promptly make available to it an amount equal to the
 estimated insured deposits of such bank in default plus the estimated amount
 of the expenses of operating the new bank, and shall determine as soon as
 possible the amount due each depositor for the depositor's insured deposit
 in the bank in default, and the total expenses of operation of the new bank.
 `(B) Upon such determination, the amounts so estimated and made available
 shall be adjusted to conform to the amounts so determined.
 `(12) EARNINGS- Earnings of the new bank shall be paid over or credited to
 the Corporation in such adjustment.
 `(13) LOSSES- If any new bank, during the period it continues its status
 as such, sustains any losses with respect to which it is not effectively
 protected except by reason of being an insured bank, the Corporation shall
 furnish to it additional funds in the amount of such losses.
 `(14) PAYMENT OF INSURED DEPOSITS- (A) The new bank shall assume as
 transferred deposits the payment of the insured deposits of such bank in
 default to each of its depositors.
 `(B) Of the amounts so made available, the Corporation shall transfer to
 the new bank, in cash, such sums as may be necessary to enable it to meet
 its expenses of operation and immediate cash demands on such transferred
 deposits, and the remainder of such amounts shall be subject to withdrawal
 by the new bank on demand.
 `(15) ISSUANCE OF STOCK- (A) Whenever in the judgment of the Board of
 Directors it is desirable to do so, the Corporation shall cause capital
 stock of the new bank to be offered for sale on such terms and conditions
 as the Board of Directors shall deem advisable in an amount sufficient,
 in the opinion of the Board of Directors, to make possible the conduct of
 the business of the new bank on a sound basis, but in no event less than
 that required by section 5138 of the Revised Statutes for the organization
 of a national bank in the place where such new bank is located.
 `(B) The stockholders of the insured bank in default shall be given the
 first opportunity to purchase any shares of common stock so offered.
 `(16) ISSUANCE OF CERTIFICATE- Upon proof that an adequate amount of
 capital stock in the new bank has been subscribed and paid for in cash, the
 Comptroller of the Currency shall require the articles of association and the
 organization certificate to be amended to conform to the requirements for the
 organization of a national bank, and thereafter, when the requirements of
 law with respect to the organization of a national bank have been complied
 with, the Comptroller of the Currency shall issue to the bank a certificate
 of authority to commence business, and thereupon the bank shall cease to
 have the status of a new bank, shall be managed by directors elected by
 its own shareholders, may exercise all the powers granted by law, and shall
 be subject to all provisions of law relating to national banks. Such bank
 shall thereafter be an insured national bank, without certification to or
 approval by the Corporation.
 `(17) TRANSFER TO OTHER INSTITUTION- If the capital stock of the new bank
 is not offered for sale, or if an adequate amount of capital for such new
 bank is not subscribed and paid for, the Board of Directors may offer to
 transfer its business to any insured depository institution in the same
 community which will take over its assets, assume its liabilities, and pay
 to the Corporation for such business such amount as the Board of Directors
 may deem adequate; or the Board of Directors in its discretion may change
 the location of the new bank to the office of the Corporation or to some
 other place or may at any time wind up its affairs as herein provided.
 `(18) WINDING UP- Unless the capital stock of the new bank is sold or
 its assets are taken over and its liabilities are assumed by an insured
 depository institution as above provided within 2 years after the date of its
 organization, the Corporation shall wind up the affairs of such bank, after
 giving such notice, if any, as the Comptroller of the Currency may require,
 and shall certify to the Comptroller of the Currency the termination of the
 new bank. Thereafter the Corporation shall be liable for the obligations
 of such bank and shall be the owner of its assets.
 `(19) APPLICABILITY OF CERTAIN LAWS- The provisions of sections 5220 and 5221
 of the Revised Statutes shall not apply to a new bank under this subsection.'.
SEC. 214. BRIDGE BANKS.
 Section 11 of the Federal Deposit Insurance Act (12 U.S.C. 1821) is amended
 by inserting after subsection (m) (as added by section 213) the following
 new subsection:
 `(n) Bridge Banks-
 `(1) Organization-
 `(A) PURPOSE- When 1 or more insured banks are in default, or when
 the Corporation anticipates that 1 or more insured banks may become in
 default, the Corporation may, in its discretion, organize, and the Office
 of the Comptroller of the Currency shall charter, 1 or more national banks
 with respect thereto with the powers and attributes of national banking
 associations, subject to the provisions of this subsection, to be referred
 to as bridge banks.
 `(B) AUTHORITIES- Upon the granting of a charter to a bridge bank, the
 bridge bank may--
 `(i) assume such deposits of such insured bank or banks that is or are in
 default or in danger of default as the Corporation may, in its discretion,
 determine to be appropriate, except that if any insured deposits of a bank
 are assumed, all insured deposits of that bank shall be assumed by the
 bridge bank or another insured depository institution;
 `(ii) assume such other liabilities (including liabilities associated
 with any trust business) of such insured bank or banks that is or are in
 default or in danger of default as the Corporation may, in its discretion,
 determine to be appropriate;
 `(iii) purchase such assets (including assets associated with any trust
 business) of such insured bank or banks that is or are in default or in
 danger of default as the Corporation may, in its discretion, determine to
 be appropriate; and
 `(iv) perform any other temporary function which the Corporation may,
 in its discretion, prescribe in accordance with this Act.
 `(C) ARTICLES OF ASSOCIATION- The articles of association and organization
 certificate of a bridge bank as approved by the Corporation shall be executed
 by 3 representatives designated by the Corporation.
 `(D) INTERIM DIRECTORS- A bridge bank shall have an interim board of
 directors consisting of not fewer than 5 nor more than 10 members appointed
 by the Corporation.
 `(E) NATIONAL BANK- A bridge bank shall be organized as a national bank.
 `(2) Chartering-
 `(A) CONDITIONS- A national bank may be chartered by the Comptroller of
 the Currency as a bridge bank only if the Board of Directors determines that--
 `(i) the amount which is reasonably necessary to operate such bridge bank
 will not exceed the amount which is reasonably necessary to save the cost
 of liquidating, including paying the insured accounts of, 1 or more insured
 banks in default or in danger of default with respect to which the bridge
 bank is chartered;
 `(ii) the continued operation of such insured bank or banks in default or
 in danger of default with respect to which the bridge bank is chartered is
 essential to provide adequate banking services in the community where each
 such bank in default or in danger of default is located; or
 `(iii) the continued operation of such insured bank or banks in default or
 in danger of default with respect to which the bridge bank is chartered is
 in the best interest of the depositors of such bank or banks in default or
 in danger of default or the public.
 `(B) INSURED NATIONAL BANK- A bridge bank shall be an insured bank from
 the time it is chartered as a national bank.
 `(C) BRIDGE BANK TREATED AS BEING IN DEFAULT FOR CERTAIN PURPOSES- A bridge
 bank shall be treated as an insured bank in default at such times and for
 such purposes as the Corporation may, in its discretion, determine.
 `(D) MANAGEMENT- A bridge bank, upon the granting of its charter, shall be
 under the management of a board of directors consisting of not fewer than
 5 nor more than 10 members appointed by the Corporation.
 `(E) BYLAWS- The board of directors of a bridge bank shall adopt such bylaws
 as may be approved by the Corporation.
 `(3) Transfer of assets and liabilities-
 `(A) In general-
 `(i) TRANSFER UPON GRANT OF CHARTER- Upon the granting of a charter to
 a bridge bank pursuant to this subsection, the Corporation, as receiver,
 or any other receiver appointed with respect to any insured bank in default
 with respect to which the bridge bank is chartered may transfer any assets
 and liabilities of such bank in default to the bridge bank in accordance
 with paragraph (1).
 `(ii) SUBSEQUENT TRANSFERS- At any time after a charter is granted to a
 bridge bank, the Corporation, as receiver, or any other receiver appointed
 with respect to an insured bank in default may transfer any assets and
 liabilities of such insured bank in default as the Corporation may, in its
 discretion, determine to be appropriate in accordance with paragraph (1).
 `(iii) TREATMENT OF TRUST BUSINESS- For purposes of this paragraph, the
 trust business, including fiduciary appointments, of any insured bank in
 default is included among its assets and liabilities.
 `(iv) EFFECTIVE WITHOUT APPROVAL- The transfer of any assets or liabilities,
 including those associated with any trust business, of an insured bank
 in default transferred to a bridge bank shall be effective without any
 further approval under Federal or State law, assignment, or consent with
 respect thereto.
 `(B) INTENT OF CONGRESS REGARDING CONTINUING OPERATIONS- It is the intent
 of the Congress that, in order to prevent unnecessary hardship or losses
 to the customers of any insured bank in default with respect to which a
 bridge bank is chartered, especially creditworthy farmers, small businesses,
 and households, the Corporation should--
 `(i) continue to honor commitments made by the bank in default to creditworthy
 customers, and
 `(ii) not interrupt or terminate adequately secured loans which are
 transferred under subparagraph (A) and are being repaid by the debtor in
 accordance with the terms of the loan instrument.
 `(4) POWERS OF BRIDGE BANKS- Each bridge bank chartered under this subsection
 shall have all corporate powers of, and be subject to the same provisions
 of law as, a national bank, except that--
 `(A) the Corporation may--
 `(i) remove the interim directors and directors of a bridge bank;
 `(ii) fix the compensation of members of the interim board of directors
 and the board of directors and senior management, as determined by the
 Corporation in its discretion, of a bridge bank; and
 `(iii) waive any requirement established under section 5145, 5146, 5147, 5148,
 or 5149 of the Revised Statutes (relating to directors of national banks)
 or section 31 of the Banking Act of 1933 which would otherwise be applicable
 with respect to directors of a bridge bank by operation of paragraph (2)(B);
 `(B) the Corporation may indemnify the representatives for purposes of
 paragraph (1)(B) and the interim directors, directors, officers, employees,
 and agents of a bridge bank on such terms as the Corporation determines to
 be appropriate;
 `(C) no requirement under section 5138 of the Revised Statutes or any other
 provision of law relating to the capital of a national bank shall apply
 with respect to a bridge bank;
 `(D) the Comptroller of the Currency may establish a limitation on the
 extent to which any person may become indebted to a bridge bank without
 regard to the amount of the bridge bank's capital or surplus;
 `(E)(i) the board of directors of a bridge bank shall elect a chairperson
 who may also serve in the position of chief executive officer, except that
 such person shall not serve either as chairperson or as chief executive
 officer without the prior approval of the Corporation;
 `(ii) the board of directors of a bridge bank may appoint a chief executive
 officer who is not also the chairperson, except that such person shall
 not serve as chief executive officer without the prior approval of the
 Corporation;
 `(F) a bridge bank shall not be required to purchase stock of any Federal
 Reserve bank;
 `(G) the Comptroller of the Currency shall waive any requirement for a
 fidelity bond with respect to a bridge bank at the request of the Corporation;
 `(H) any judicial action to which a bridge bank becomes a party by virtue
 of its acquisition of any assets or assumption of any liabilities of a bank
 in default shall be stayed from further proceedings for a period of up to
 45 days at the request of the bridge bank;
 `(I) no agreement which tends to diminish or defeat the right, title
 or interest of a bridge bank in any asset of an insured bank in default
 acquired by it shall be valid against the bridge bank unless such agreement--
 `(i) is in writing,
 `(ii) was executed by such insured bank in default and the person or
 persons claiming an adverse interest thereunder, including the obligor,
 contemporaneously with the acquisition of the asset by such insured bank
 in default,
 `(iii) was approved by the board of directors of such insured bank in default
 or its loan committee, which approval shall be reflected in the minutes of
 said board or committee, and
 `(iv) has been, continuously from the time of its execution, an official
 record of such insured bank in default;
 `(J) notwithstanding section 13(e)(2), any agreement relating to an
 extension of credit between a Federal home loan bank or Federal Reserve
 bank and any insured depository institution which was executed before the
 extension of credit by such bank to such depository institution shall be
 treated as having been executed contemporaneously with such extension of
 credit for purposes of subparagraph (I); and
 `(K) except with the prior approval of the Corporation, a bridge bank may not,
 in any transaction or series of transactions, issue capital stock or be a
 party to any merger, consolidation, disposition of assets or liabilities, sale
 or exchange of capital stock, or similar transaction, or change its charter.
 `(5) CAPITAL-
 `(A) NO CAPITAL REQUIRED- The Corporation shall not be required to--
 `(i) issue any capital stock on behalf of a bridge bank chartered under
 this subsection; or
 `(ii) purchase any capital stock of a bridge bank, except that notwithstanding
 any other provision of Federal or State law, the Corporation may purchase
 and retain capital stock of a bridge bank in such amounts and on such terms
 as the Corporation, in its discretion, determines to be appropriate.
 `(B) OPERATING FUNDS IN LIEU OF CAPITAL- Upon the organization of a bridge
 bank, and thereafter, as the Board of Directors may, in its discretion,
 determine to be necessary or advisable, the Corporation may make available
 to the bridge bank, upon such terms and conditions and in such form and
 amounts as the Corporation may in its discretion determine, funds for the
 operation of the bridge bank in lieu of capital.
 `(C) AUTHORITY TO ISSUE CAPITAL STOCK- Whenever the Board of Directors
 determines it is advisable to do so, the Corporation shall cause capital stock
 of a bridge bank to be issued and offered for sale in such amounts and on such
 terms and conditions as the Corporation may, in its discretion, determine.
 `(6) No federal status-
 `(A) AGENCY STATUS- A bridge bank is not an agency, establishment, or
 instrumentality of the United States.
 `(B) EMPLOYEE STATUS- Representatives for purposes of paragraph (1)(B),
 interim directors, directors, officers, employees, or agents of a bridge
 bank are not, solely by virtue of service in any such capacity, officers
 or employees of the United States. Any employee of the Corporation or of
 any Federal instrumentality who serves at the request of the Corporation
 as a representative for purposes of paragraph (1)(B), interim director,
 director, officer, employee, or agent of a bridge bank shall not--
 `(i) solely by virtue of service in any such capacity lose any existing
 status as an officer or employee of the United States for purposes of title
 5, United States Code, or any other provision of law, or
 `(ii) receive any salary or benefits for service in any such capacity
 with respect to a bridge bank in addition to such salary or benefits
 as are obtained through employment with the Corporation or such Federal
 instrumentality.
 `(7) ASSISTANCE AUTHORIZED- The Corporation may, in its discretion, provide
 assistance under section 13(c) to facilitate any transaction described in
 clause (i), (ii), or (iii) of paragraph (10)(A) with respect to any bridge
 bank in the same manner and to the same extent as such assistance may be
 provided under such section with respect to an insured bank in default, or
 to facilitate a bridge bank's acquisition of any assets or the assumption
 of any liabilities of an insured bank in default.
 `(8) Acquisition-
 `(A) IN GENERAL- The responsible agency shall notify the Attorney General
 of any transaction involving the merger or sale of a bridge bank requiring
 approval under section 18(c) and if a report on competitive factors is
 requested within 10 days, such transaction may not be consummated before
 the 5th calendar day after the date of approval by the responsible agency
 with respect thereto. If the responsible agency has found that it must act
 immediately to prevent the probable failure of 1 of the banks involved,
 the preceding sentence does not apply and the transaction may be consummated
 immediately upon approval by the agency.
 `(B) BY OUT-OF-STATE HOLDING COMPANY- Any depository institution, including
 an out-of-State depository institution, or any out-of-State depository
 institution holding company may acquire and retain the capital stock or
 assets of, or otherwise acquire and retain a bridge bank if the bridge bank
 at any time had assets aggregating $500,000,000 or more, as determined by
 the Corporation on the basis of the bridge bank's reports of condition or
 on the basis of the last available reports of condition of any insured bank
 in default, which institution has been acquired, or whose assets have been
 acquired, by the bridge bank. The acquiring entity may acquire the bridge
 bank only in the same manner and to the same extent as such entity may
 acquire an insured bank in default under section 13(f)(2).
 `(9) DURATION OF BRIDGE BANK- Subject to paragraphs (11) and (13), the
 status of a bridge bank as such shall terminate at the end of the 2-year
 period following the date it was granted a charter. The Board of Directors
 may, in its discretion, extend the status of the bridge bank as such for
 3 additional 1-year periods.
 `(10) TERMINATION OF BRIDGE BANK STATUS- The status of any bridge bank as
 such shall terminate upon the earliest of--
 `(A) the merger or consolidation of the bridge bank with a depository
 institution that is not a bridge bank;
 `(B) at the election of the Corporation, the sale of a majority of the
 capital stock of the bridge bank to an entity other than the Corporation
 and other than another bridge bank;
 `(C) the sale of 80 percent, or more, of the capital stock of the bridge bank
 to an entity other than the Corporation and other than another bridge bank;
 `(D) at the election of the Corporation, either the assumption of all or
 substantially all of the deposits and other liabilities of the bridge bank
 by a depository institution holding company or a depository institution
 that is not a bridge bank, or the acquisition of all or substantially all of
 the assets of the bridge bank by a depository institution holding company,
 a depository institution that is not a bridge bank, or other entity as
 permitted under applicable law; and
 `(E) the expiration of the period provided in paragraph (9), or the earlier
 dissolution of the bridge bank as provided in paragraph (12).
 `(11) EFFECT OF TERMINATION EVENTS-
 `(A) MERGER OR CONSOLIDATION- A bridge bank that participates in a merger or
 consolidation as provided in paragraph (10)(A) shall be for all purposes
 a national bank with all the rights, powers, and privileges thereof,
 and such merger or consolidation shall be conducted in accordance with,
 and shall have the effect provided in, the provisions of applicable law.
 `(B) CHARTER CONVERSION- Following the sale of a majority of the capital
 stock of the bridge bank as provided in paragraph (10)(B), the Corporation
 may amend the charter of the bridge bank to reflect the termination of
 the status of the bridge bank as such, whereupon the bank shall remain
 a national bank, with all of the rights, powers, and privileges thereof,
 subject to all laws and regulations applicable thereto.
 `(C) SALE OF STOCK- Following the sale of 80 percent or more of the capital
 stock of a bridge bank as provided in paragraph (10)(C), the bank shall
 remain a national bank, with all of the rights, powers, and privileges
 thereof, subject to all laws and regulations applicable thereto.
 `(D) ASSUMPTION OF LIABILITIES AND SALE OF ASSETS- Following the assumption of
 all or substantially all of the liabilities of the bridge bank, or the sale
 of all or substantially all of the assets of the bridge bank, as provided
 in paragraph (10)(D), at the election of the Corporation the bridge bank
 may retain its status as such for the period provided in paragraph (8).
 `(E) EFFECT ON HOLDING COMPANIES- A depository institution holding
 company acquiring a bridge bank under section 13(f), paragraph (8)(B)
 (or any predecessor provision), or both provisions, shall not be impaired
 or adversely affected by the termination of the status of a bridge bank
 as a result of subparagraph (A), (B), (C), or (D) of paragraph (10), and
 shall be entitled to the rights and privileges provided in section 13(f).
 `(F) AMENDMENTS TO CHARTER- Following the consummation of a transaction
 described in subparagraph (A), (B), (C), or (D) of paragraph (10), the
 charter of the resulting institution shall be amended to reflect the
 termination of bridge bank status, if appropriate.
 `(12) DISSOLUTION OF BRIDGE BANK-
 `(A) IN GENERAL- Notwithstanding any other provision of State or Federal
 law, if the bridge bank's status as such has not previously been terminated
 by the occurrence of an event specified in subparagraphs (A), (B), (C), or
 (D) of paragraph (10)--
 `(i) the Board of Directors may, in its discretion, dissolve a bridge bank
 in accordance with this paragraph at any time; and
 `(ii) the Board of Directors shall promptly commence dissolution proceedings
 in accordance with this paragraph upon the expiration of the 2-year period
 following the date the bridge bank was chartered, or any extension thereof,
 as provided in paragraph (9).
 `(B) PROCEDURES- The Comptroller of the Currency shall appoint the Corporation
 receiver for a bridge bank upon certification by the Board of Directors
 to the Comptroller of the Currency of its determination to dissolve the
 bridge bank. The Corporation as such receiver shall wind up the affairs
 of the bridge bank in conformity with the provisions of law relating to
 the liquidation of closed national banks. With respect to any such bridge
 bank, the Corporation as such receiver shall have all the rights, powers,
 and privileges and shall perform the duties related to the exercise of such
 rights, powers, or privileges granted by law to a receiver of any insured
 depository institution and notwithstanding any other provision of law in
 the exercise of such rights, powers, and privileges the Corporation shall
 not be subject to the direction or supervision of any State agency or other
 Federal agency.
 `(13) MULTIPLE BRIDGE BANKS- Subject to paragraph (1)(B)(i), the Corporation
 may, in the Corporation's discretion, organize 2 or more bridge banks under
 this subsection to assume any deposits of, assume any other liabilities of,
 and purchase any assets of a single bank in default.'.
SEC. 215. FSLIC RESOLUTION FUND.
 The Federal Deposit Insurance Act is amended by inserting after section 11
 the following:
`SEC. 11A. FSLIC RESOLUTION FUND.
 `(a) Established-
 `(1) IN GENERAL- There is established a separate fund to be designated as
 the FSLIC Resolution Fund which shall be managed by the Corporation and
 separately maintained and not commingled.
 `(2) Transfer of fslic assets and liabilities-
 `(A) IN GENERAL- Except as provided in section 21A of the Federal Home
 Loan Bank Act, all assets and liabilities of the Federal Savings and Loan
 Insurance Corporation on the day before the date of the enactment of the
 Financial Institutions Reform, Recovery, and Enforcement Act of 1989 shall
 be transferred to the FSLIC Resolution Fund.
 `(B) ADDITIONAL CLAIMS ON ASSETS- The FSLIC Resolution Fund shall pay
 to the Savings Association Insurance Fund such amounts as are needed for
 administrative and supervisory expenses from the date of enactment of the
 Financial Institutions Reform, Recovery, and Enforcement Act of 1989 through
 September 30, 1991.
 `(3) SEPARATE HOLDING- Assets and liabilities transferred to the FSLIC
 Resolution Fund shall be the assets and liabilities of the Fund and not of
 the Corporation and shall not be consolidated with the assets and liabilities
 of the Bank Insurance Fund, the Savings Association Insurance Fund, or the
 Corporation for accounting, reporting, or any other purpose.
 `(b) SOURCE OF FUNDS- The FSLIC Resolution Fund shall be funded from the
 following sources to the extent funds are needed in the listed priority:
 `(1) Income earned on assets of the FSLIC Resolution Fund.
 `(2) Liquidating dividends and payments made on claims received by the
 FSLIC Resolution Fund from receiverships to the extent such funds are not
 required by the Resolution Funding Corporation pursuant to section 21B of
 the Federal Home Loan Bank Act or the Financing Corporation pursuant to
 section 21 of such Act.
 `(3) Amounts borrowed by the Financing Corporation pursuant to section 21
 of the Federal Home Loan Bank Act.
 `(4) During the period beginning on the date of the enactment of the
 Financial Institutions Reform, Recovery, and Enforcement Act of 1989 and
 ending on December 31, 1991, amounts assessed against Savings Association
 Insurance Fund members by the Corporation pursuant to section 7 which
 are not required by the Financing Corporation pursuant to section 21 of
 the Federal Home Loan Bank Act or by the Resolution Funding Corporation
 pursuant to section 21B of the Federal Home Loan Bank Act.
 `(c) TREASURY BACKUP-
 `(1) IN GENERAL- If the funds described in subsections (a) and (b) are
 insufficient to satisfy the liabilities of the FSLIC Resolution Fund,
 the Secretary of the Treasury shall pay to the Fund such amounts as may be
 necessary, as determined by the Corporation and the Secretary, for FSLIC
 Resolution Fund purposes.
 `(2) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be appropriated
 to the Secretary of the Treasury, without fiscal year limitation, such sums
 as may be necessary to carry out this section.
 `(d) LEGAL PROCEEDINGS- Any judgment resulting from a proceeding to which
 the Federal Savings and Loan Insurance Corporation was a party prior to its
 dissolution or which is initiated against the Corporation with respect to the
 Federal Savings and Loan Insurance Corporation or with respect to the FSLIC
 Resolution Fund shall be limited to the assets of the FSLIC Resolution Fund.
 `(e) TRANSFER OF NET PROCEEDS FROM SALE OF RTC ASSETS- The FSLIC Resolution
 Fund shall transfer to the Resolution Funding Corporation any net proceeds
 from the sale of assets acquired from the Resolution Trust Corporation upon
 the termination of such Corporation pursuant to section 21A of the Federal
 Home Loan Bank Act.
 `(f) DISSOLUTION- The FSLIC Resolution Fund shall be dissolved upon
 satisfaction of all debts and liabilities and sale of all assets. Upon
 dissolution any remaining funds shall be paid into the Treasury. Any
 administrative facilities and supplies, including offices and office supplies,
 shall be transferred to the Corporation for use by and to be held as assets
 of the Savings Association Insurance Fund.'.
SEC. 216. AMENDMENTS TO SECTION 12.
 Section 12 of the Federal Deposit Insurance Act (12 U.S.C. 1822) is amended--
 (1) by striking out `closed bank' each place it appears and inserting in
 lieu thereof `depository institution in default';
 (2) by striking out subsection (a) and inserting the following:
 `(a) BOND NOT REQUIRED; AGENTS; FEE- The Corporation as receiver of an
 insured depository institution or branch of a foreign bank shall not be
 required to furnish bond and may appoint an agent or agents to assist it
 in its duties as such receiver. All fees, compensation, and expenses of
 liquidation and administration shall be fixed by the Corporation, and may
 be paid by it out of funds coming into its possession as such receiver.'; and
 (3) in subsection (d)--
 (A) by striking out `as a stockholder of the depository institution in
 default, or of any liability of such depositor'; and
 (B) by striking out `such bank' and inserting in lieu thereof `such
 depository institution'.
SEC. 217. AMENDMENTS TO SECTION 13.
 Section 13 of the Federal Deposit Insurance Act (12 U.S.C. 1823) is amended--
 (1) by striking out subsection (a) and inserting the following:
 `(a) INVESTMENT OF CORPORATION'S FUNDS-
 `(1) AUTHORITY- Funds held in the Bank Insurance Fund, the Savings Association
 Insurance Fund, or the FSLIC Resolution Fund, that are not otherwise employed
 shall be invested in obligations of the United States or in obligations
 guaranteed as to principal and interest by the United States.
 `(2) LIMITATION- The Corporation shall not sell or purchase any obligations
 described in paragraph (1) for its own account, at any one time aggregating in
 excess of $100,000, without the approval of the Secretary of the Treasury. The
 Secretary may approve a transaction or class of transactions subject to
 the provisions of this paragraph under such conditions as the Secretary
 may determine.';
 (2) in subsection (b)--
 (A) by striking out `banking and checking' and `banking or checking' each
 place such terms appear and inserting in lieu thereof `depository';
 (B) by striking out `bank' (except `Federal Reserve bank') each place such
 term appears and inserting in lieu thereof `depository institution';
 (3) in subsection (c)--
 (A) by striking out `closing' or `closed' each place such terms appear and
 inserting in lieu thereof `default' or `in default';
 (B) by striking out `an' before `closed insured bank' each place such terms
 appear and inserting in lieu thereof `a';
 (C) by striking out `in default insured depository institution' each
 place such term appears and inserting in lieu thereof `insured depository
 institution in default';
 (D) in paragraph (2)(A)--
 (i) by striking out `such insured institution' and `an insured depository
 institution' and inserting in lieu thereof `such other insured depository
 institution' and `another insured depository institution', respectively;
 (ii) by inserting `any or all of the' after `the sale of'; and
 (iii) by striking out `and the assumption' and inserting in lieu thereof
 `or the assumption of any or all';
 (E) by adding at the end of paragraph (2) the following:
 `(C) Any action to which the Corporation is or becomes a party by acquiring
 any asset or exercising any other authority set forth in this section shall
 be stayed for a period of 60 days at the request of the Corporation.';
 (F) in paragraph (3), by striking out `section 13(f) of this Act' and
 inserting in lieu thereof `subsection (f) or (k) of this section';
 (G) in paragraph (4)--
 (i) by striking out `banking' and inserting in lieu thereof `depository'; and
 (ii) by inserting at the end of subparagraph (A) the following: `In
 calculating the cost of assistance, the Corporation shall include (i)
 the immediate and long-term obligations of the Corporation with respect to
 such assistance, including contingent liabilities, and (ii) the Federal tax
 revenues foregone by the Government, to the extent reasonably ascertainable.';
 and
 (H) by striking out paragraph (8);
 (I) by redesignating paragraphs (6) and (7) as paragraphs (7) and (8),
 respectively; and
 (J) by inserting after paragraph (5) the following:
 `(6) The transfer of any assets or liabilities associated with any trust
 business of an insured depository institution in default under subparagraph
 (2)(A) shall be effective without any State or Federal approval, assignment,
 or consent with respect thereto.'; and
 (K) by adding at the end the following:
 `(9) Payments made under this subsection shall be made--
 `(A) from the Bank Insurance Fund in the case of payments to or on behalf
 of a member of such Fund; or
 `(B) from the Savings Association Insurance Fund or from funds made available
 by the Resolution Trust Corporation in the case of payments to or on behalf
 of any Savings Association Insurance Fund member.';
 (4) by striking out subsections (d) and (e) and inserting the following:
 `(d) SALE OF ASSETS TO CORPORATION-
 `(1) IN GENERAL.-Any conservator, receiver, or liquidator appointed for
 any insured depository institution in default, including the Corporation
 acting in such capacity, shall be entitled to offer the assets of such
 depository institutions for sale to the Corporation or as security for
 loans from the Corporation.
 `(2) PROCEEDS- The proceeds of every sale or loan of assets to the Corporation
 shall be utilized for the same purposes and in the same manner as other funds
 realized from the liquidation of the assets of such depository institutions.
 `(3) RIGHTS AND POWERS OF CORPORATION-
 `(A) IN GENERAL- With respect to any asset acquired or liability assumed
 pursuant to this section, the Corporation shall have all of the rights,
 powers, privileges, and authorities of the Corporation as receiver under
 sections 11 and 15(b).
 `(B) RULE OF CONSTRUCTION- Such rights, powers, privileges, and authorities
 shall be in addition to and not in derogation of any rights, powers,
 privileges, and authorities otherwise applicable to the Corporation.
 `(C) FIDUCIARY RESPONSIBILITY- In exercising any right, power, privilege, or
 authority described in subparagraph (A), the Corporation shall continue to be
 subject to the fiduciary duties and obligations of the Corporation as receiver
 to claimants against the insured depository institution in receivership.
 `(4) LOANS- The Corporation, in its discretion, may make loans on the
 security of or may purchase and liquidate or sell any part of the assets of
 an insured depository institution which is now or may hereafter be in default.
 `(e) AGREEMENTS AGAINST INTERESTS OF CORPORATION- No agreement which tends
 to diminish or defeat the interest of the Corporation in any asset acquired
 by it under this section or section 11, either as security for a loan or
 by purchase or as receiver of any insured depository institution, shall be
 valid against the Corporation unless such agreement--
 `(1) is in writing,
 `(2) was executed by the depository institution and any person claiming an
 adverse interest thereunder, including the obligor, contemporaneously with
 the acquisition of the asset by the depository institution,
 `(3) was approved by the board of directors of the depository institution
 or its loan committee, which approval shall be reflected in the minutes of
 said board or committee, and
 `(4) has been, continuously, from the time of its execution, an official
 record of the depository institution.';
 (5) in subsection (f)--
 (A) by striking out `closed' and `closing' each place such terms appear
 (except in `closed bank') and inserting in lieu thereof `in default' or
 `default', respectively;
 (B) by striking out `closed bank' and inserting in lieu thereof `bank
 in default';
 (C) in paragraph (1), by inserting `savings association' after `out-of-state
 bank';
 (D) in paragraph (2)(B)(iii), by striking out `a unanimous vote' and
 inserting in lieu thereof `a vote of 75 percent of';
 (E) by striking out `the constitution of any State,';
 (F) in paragraph (6)(A), by inserting `the offeror which made the initial
 lowest acceptable offer and' after `the Corporation shall permit';
 (G) by adding at the end of paragraph (7) the following:
 `(C) if in the opinion of the Corporation the acquisition threatens the
 safety and soundness of the acquirer or does not result in the future
 viability of the resulting depository institution.';
 (H) in paragraph (8), by striking out subparagraphs (A), (B), and (D) and
 redesignating paragraphs (C), (E), (F), and (G) as subparagraphs (A), (B),
 (C), and (D), respectively;
 (I) in paragraph (9)--
 (i) in the paragraph heading, by striking out `NONBANK' and inserting in
 lieu thereof `CERTAIN';
 (ii) in paragraph (9)(A), by inserting `, other than a subsidiary that is
 an insured depository institution,' after `subsidiary' and by striking out
 `which is not an insured bank'; and
 (iii) in paragraph (9)(B), by inserting `or an affiliate of an insured
 depository institution' after `intermediate holding company'; and
 (J) by adding at the end thereof the following new paragraph:
 `(12) ACQUISITION OF MINORITY BANK BY MINORITY BANK HOLDING COMPANY WITHOUT
 REGARD TO ASSET SIZE-
 `(A) IN GENERAL- For the purpose of ensuring continued minority control
 of a minority-controlled bank, paragraphs (2) and (3) shall apply with
 respect to the acquisition of a minority-controlled bank by an out-of-State
 minority-controlled depository institution or depository institution
 holding company without regard to the fact that the total assets of such
 minority-controlled bank is less than $500,000,000.
 `(B) DEFINITIONS- For purposes of this paragraph:
 `(i) MINORITY BANK- The term `minority bank' means any depository institution
 described in clause (i), (ii), or (iii) of section 19(b)(1)(A) of the
 Federal Reserve Act--
 `(I) more than 50 percent of the ownership or control of which is held by
 one or more minority individuals; and
 `(II) more than 50 percent of the net profit or loss of which accrues to
 minority individuals.
 `(ii) MINORITY- The term `minority' means any Black American, Native American,
 Hispanic American, or Asian American.';
 (6) in subsection (h), by striking out `a closed insured depository
 institution', `closing', and `insurance fund' and inserting in lieu
 thereof `an insured depository institution in default', `default', and
 `Bank Insurance Fund', respectively;
 (7) in subsection (i)--
 (A) by inserting `depository' before `institution' each place such term
 appears;
 (B) in paragraph (1)(C)--
 (i) by striking out `corporation' and inserting in lieu thereof `Corporation';
 (ii) by striking out `chartered bank' and inserting in lieu thereof
 `chartered depository institution';
 (iii) by inserting `, a savings association,' after `State member bank'; and
 (iv) by inserting `or the Director of the Office of Thrift Supervision'
 after `Federal Reserve System';
 (C) in paragraph (2), by striking out `or insured or guaranteed under State
 law'; and
 (D) by striking out paragraphs (10) and (12); and
 (8) by adding at the end thereof the following:
 `(k) Emergency Acquisitions-
 `(1) In general-
 `(A) Acquisitions authorized-
 `(i) TRANSACTIONS DESCRIBED- Notwithstanding any provision of State law,
 upon determining that severe financial conditions threaten the stability of
 a significant number of savings associations, or of savings associations
 possessing significant financial resources, the Corporation, in its
 discretion and if it determines such authorization would lessen the risk
 to the Corporation, may authorize--
 `(I) a savings association that is eligible for assistance pursuant to
 subsection (c) to merge or consolidate with, or to transfer its assets and
 liabilities to, any other savings association or any insured bank,
 `(II) any other savings association to acquire control of such savings
 association, or
 `(III) any company to acquire control of such savings association or to
 acquire the assets or assume the liabilities thereof.
The Corporation may not authorize any transaction under this subsection
unless the Corporation determines that the authorization will not present
a substantial risk to the safety or soundness of the savings association to
be acquired or any acquiring entity.
 `(ii) TERMS OF TRANSACTIONS- Mergers, consolidations, transfers, and
 acquisitions under this subsection shall be on such terms as the Corporation
 shall provide.
 `(iii) APPROVAL BY APPROPRIATE AGENCY- Where otherwise required by law,
 transactions under this subsection must be approved by the appropriate
 Federal banking agency of every party thereto.
 `(iv) ACQUISITIONS BY SAVINGS ASSOCIATIONS- Any Federal savings association
 that acquires another savings association pursuant to clause (i) may,
 with the concurrence of the Director of the Office of Thrift Supervision,
 hold that savings association as a subsidiary notwithstanding the percentage
 limitations of section 5(c)(4)(B) of the Home Owners' Loan Act.
 `(v) DUAL SERVICE- Dual service by a management official that would otherwise
 be prohibited under the Depository Institution Management Interlocks Act may,
 with the approval of the Corporation, continue for up to 10 years.
 `(vi) CONTINUED APPLICABILITY OF CERTAIN STATE RESTRICTIONS- Nothing in
 this subsection overrides or supersedes State laws restricting or limiting
 the activities of a savings association on behalf of another entity.
 `(B) Consultation with state official-
 `(i) CONSULTATION REQUIRED- Before making a determination to take any action
 under subparagraph (A), the Corporation shall consult the State official
 having jurisdiction of the acquired institution.
 `(ii) PERIOD FOR STATE RESPONSE- The official shall be given a reasonable
 opportunity, and in no event less than 48 hours, to object to the use
 of the provisions of this paragraph. Such notice may be provided by the
 Corporation prior to its appointment as receiver, but in anticipation of
 an impending appointment.
 `(iii) APPROVAL OVER OBJECTION OF STATE OFFICIAL- If the official objects
 during such period, the Corporation may use the authority of this paragraph
 only by a vote of 75 percent or more of the voting members of the Board
 of Directors. The Corporation shall provide to the official, as soon as
 practicable, a written certification of its determination.
 `(2) Solicitation of offers-
 `(A) IN GENERAL- In considering authorizations under this subsection,
 the Corporation may solicit such offers or proposals as are practicable
 from any prospective purchasers or merger partners it determines, in its
 sole discretion, are both qualified and capable of acquiring the assets
 and liabilities of the savings association.
 `(B) MINORITY-CONTROLLED INSTITUTIONS- In the case of a minority-controlled
 depository institution, the Corporation shall seek an offer from other
 minority-controlled depository institutions before seeking an offer from
 other persons or entities.
 `(3) DETERMINATION OF COSTS- In determining the cost of offers under
 this subsection, the Corporation's calculations and estimations shall be
 determinative. The Corporation may set reasonable time limits on offers.
 `(4) BRANCHING PROVISIONS-
 `(A) IN GENERAL- If a merger, consolidation, transfer, or acquisition under
 this subsection involves a savings association eligible for assistance and a
 bank or bank holding company, a savings association may retain and operate
 any existing branch or branches or any other existing facilities. If the
 savings association continues to exist as a separate entity, it may establish
 and operate new branches to the same extent as any savings association that
 is not affiliated with a bank holding company and the home office of which
 is located in the same State.
 `(B) Restrictions-
 `(i) IN GENERAL- Notwithstanding subparagraph (A), if--
 `(I) a savings association described in such subparagraph does not have
 its home office in the State of the bank holding company bank subsidiary, and
 `(II) such association does not qualify as a domestic building and loan
 association under section 7701(a)(19) of the Internal Revenue Code of 1986,
 or does not meet the asset composition test imposed by subparagraph (C)
 of that section on institutions seeking so to qualify,
such savings association shall be subject to the conditions upon which a
bank may retain, operate, and establish branches in the State in which the
Savings Association Insurance Fund member is located.
 `(ii) TRANSITION PERIOD- The Corporation, for good cause shown, may allow a
 savings association up to 2 years to comply with the requirements of clause
 (i).
 `(5) ASSISTANCE BEFORE APPOINTMENT OF CONSERVATOR OR RECEIVER-
 `(A) ASSISTANCE PROPOSALS- The Corporation shall consider proposals by Savings
 Association Insurance Fund members for assistance pursuant to subsection
 (c) before grounds exist for appointment of a conservator or receiver for
 such member under the following circumstances:
 `(i) TROUBLED CONDITION CRITERIA- The Corporation determines--
 `(I) that grounds for appointment of a conservator or receiver exist or likely
 will exist in the future unless the member's tangible capital is increased;
 `(II) that it is unlikely that the member can achieve positive tangible
 capital without assistance; and
 `(III) that providing assistance pursuant to the member's proposal would
 be likely to lessen the risk to the Corporation.
 `(ii) OTHER CRITERIA- The member meets the following criteria:
 `(I) Before enactment of the Financial Institutions Reform, Recovery, and
 Enforcement Act of 1989, the member was solvent under applicable regulatory
 accounting principles but had negative tangible capital.
 `(II) The member's negative tangible capital position is substantially
 attributable to its participation in acquisition and merger transactions
 that were instituted by the Federal Home Loan Bank Board or the Federal
 Savings and Loan Insurance Corporation for supervisory reasons.
 `(III) The member is a qualified thrift lender (as defined in section 10(m)
 of the Home Owners' Loan Act) or would be a qualified thrift lender if
 commercial real estate owned and nonperforming commercial loans acquired
 in acquisition and merger transactions that were instituted by the Federal
 Home Loan Bank Board or the Federal Savings and Loan Insurance Corporation
 for supervisory reasons were excluded from the member's total assets.
 `(IV) The appropriate Federal banking agency has determined that the
 member's management is competent and has complied with applicable laws,
 rules, and supervisory directives and orders.
 `(V) The member's management did not engage in insider dealing or speculative
 practices or other activities that jeopardized the member's safety and
 soundness or contributed to its impaired capital position.
 `(VI) The member's offices are located in an economically depressed region.
 `(B) CORPORATION CONSIDERATION OF ASSISTANCE PROPOSAL- If a member meets the
 requirements of clauses (i) and (ii) of subparagraph (A), the Corporation
 shall consider providing direct financial assistance.
 `(C) ECONOMICALLY DEPRESSED REGION DEFINED- For purposes of this paragraph,
 the term `economically depressed region' means any geographical region
 which the Corporation determines by regulation to be a region within which
 real estate values have suffered serious decline due to severe economic
 conditions, such as a decline in energy or agricultural values or prices.'.
SEC. 218. FDIC BORROWING AUTHORITY.
 Section 14 of the Federal Deposit Insurance Act (12 U.S.C. 1824) is amended--
 (1) by striking out `$3,000,000,000 outstanding at any one time' and
 inserting in lieu thereof `$5,000,000,000 outstanding at any one time,
 subject to the approval of the Secretary of the Treasury'; and
 (2) by adding at the end the following: `The Corporation may employ such
 funds for purposes of the Bank Insurance Fund or the Savings Association
 Insurance Fund and the borrowing shall become a liability of each such fund
 to the extent funds are employed therefor. There are hereby appropriated
 to the Secretary, for fiscal year 1989 and each fiscal year thereafter,
 such sums as may be necessary to carry out this section.'; and
 (3) by striking out `the current average rate on outstanding marketable
 and nonmarketable obligations of the United States as of the last day of
 the month preceding the making of such loan' and inserting in lieu thereof
 the following: `an amount determined by the Secretary of the Treasury,
 taking into consideration current market yields on outstanding marketable
 obligations of the United States of comparable maturities'.
SEC. 219. EXEMPTION FROM TAXATION; LIMITATION ON BORROWING.
 Section 15 of the Federal Deposit Insurance Act (12 U.S.C. 1825) is amended--
 (1) by inserting `(a) GENERAL RULE- ' before `All'; and
 (2) by adding at the end the following new subsections:
 `(b) OTHER EXEMPTIONS- When acting as a receiver, the following provisions
 shall apply with respect to the Corporation:
 `(1) The Corporation including its franchise, its capital, reserves, and
 surplus, and its income, shall be exempt from all taxation imposed by any
 State, county, municipality, or local taxing authority, except that any
 real property of the Corporation shall be subject to State, territorial,
 county, municipal, or local taxation to the same extent according to its
 value as other real property is taxed, except that, notwithstanding the
 failure of any person to challenge an assessment under State law of such
 property's value, such value, and the tax thereon, shall be determined as
 of the period for which such tax is imposed.
 `(2) No property of the Corporation shall be subject to levy, attachment,
 garnishment, foreclosure, or sale without the consent of the Corporation,
 nor shall any involuntary lien attach to the property of the Corporation.
 `(3) The Corporation shall not be liable for any amounts in the nature of
 penalties or fines, including those arising from the failure of any person
 to pay any real property, personal property, probate, or recording tax or
 any recording or filing fees when due.
This subsection shall not apply with respect to any tax imposed (or other
amount arising) under the Internal Revenue Code of 1986.
 `(c) Limitation on Borrowing-
 `(1) COST ESTIMATE FOR OUTSTANDING OBLIGATIONS LIABILITIES- As soon as
 practicable after the date of enactment of the Financial Institutions Reform,
 Recovery, and Enforcement Act of 1989, the Corporation shall estimate
 the aggregate cost to the Corporation for all outstanding obligations
 and guarantees of the Corporation which were issued, and all outstanding
 liabilities which were incurred, by the Corporation before such date.
 `(2) ESTIMATE OF NOTES AND OTHER OBLIGATIONS REQUIRED- Before issuing an
 obligation or making a guarantee, the Corporation shall estimate the cost
 of such obligations or guarantees.
 `(3) INCLUSION OF ESTIMATES IN FINANCIAL STATEMENTS- The Corporation shall--
 `(A) reflect in its financial statements the estimates made by the Corporation
 under paragraphs (1) and (2) of the aggregate amount of the costs to the
 Corporation for outstanding obligations and other liabilities, and
 `(B) make such adjustments as are appropriate in the estimate of such
 aggregate amount not less frequently than quarterly.
 `(4) ESTIMATE OF OTHER ASSETS REQUIRED- The Corporation shall--
 `(A) estimate the market value of assets held by it as a result of case
 resolution activities, with a reduction for expenses expected to be incurred
 by the Corporation in connection with the management and sale of such assets;
 `(B) reflect the amounts so estimated in its financial statements; and
 `(C) make such adjustments as are appropriate of such market value not less
 than quarterly.
 `(5) MINIMUM NET WORTH REQUIRED- The Corporation may not issue any note or
 similar obligation, and may not incur any liability under a guarantee or
 similar obligation, with respect to either the Bank Insurance Fund or the
 Savings Association Insurance Fund if, after reduction for the estimated
 cost of the obligation or guarantee, the net worth of the affected insurance
 fund would be less than 10 percent of assets.
 `(6) EXCEPTION- With the prior approval of the Secretary of the Treasury,
 the Corporation may issue or incur up to $5,000,000,000 in the aggregate of
 additional liabilities in excess of the limitations of paragraph (5). The
 amount which the Corporation may borrow from the Treasury under section 14
 of this Act shall be reduced by the amount of additional liabilities issued
 or incurred under this paragraph.
 `(7) NET WORTH AND ASSET VALUATION- For the purpose of paragraph (5)--
 `(A) the assets of the Bank Insurance Fund or the Savings Association
 Insurance Fund shall be calculated based on the most recent audit of
 such Fund by the Comptroller General of the United States, subject to any
 adjustments described in paragraph (3) or (4) and taking into account any
 subsequent transactions; and
 `(B) the net worth of the Bank Insurance Fund or the Savings Association
 Insurance Fund shall be calculated based on the most recent audit of
 such Fund by the Comptroller General of the United States, subject to any
 adjustments described in paragraphs (3) and (4) and taking into account
 any subsequent transactions.
 `(d) FULL FAITH AND CREDIT- The full faith and credit of the United States
 is pledged to the payment of any obligation issued after the date of the
 enactment of the Financial Institutions Reform, Recovery, and Enforcement Act
 of 1989 by the Corporation, with respect to both principal and interest, if--
 `(1) the principal amount of such obligation is stated in the obligation; and
 `(2) the term to maturity or the date of maturity of such obligation is
 stated in the obligation.'.
SEC. 220. REPORTS.
 (a) IN GENERAL- Section 17 of the Federal Deposit Insurance Act (12
 U.S.C. 1827) is amended--
 (1) by striking out subsection (a) and inserting the following:
 `(a) ANNUAL REPORTS ON BIF, SAIF, AND THE FSLIC RESOLUTION FUND-
 `(1) IN GENERAL- The Corporation shall annually submit a full report of
 its operations, activities, budget, receipts, and expenditures for the
 preceding 12-month period. The report shall include, with respect to the
 Bank Insurance Fund, the Savings Association Insurance Fund, and the FSLIC
 Resolution Fund, an analysis by the Corporation of--
 `(A) the current financial condition of each such fund;
 `(B) the purpose, effect, and estimated cost of each resolution action
 taken for an insured depository institution during the preceding year;
 `(C) the extent to which the actual costs of assistance provided to, or for
 the benefit of, an insured depository institution during the preceding year
 exceeded the estimated costs of such assistance reported in a previous year
 under paragraph (A);
 `(D) the exposure of each insurance fund to changes in those economic
 factors most likely to affect the condition of that fund;
 `(E) a current estimate of the resources needed for the Bank Insurance Fund,
 the Savings Association Insurance Fund, or the FSLIC Resolution Fund to
 achieve the purposes of this Act; and
 `(F) any findings, conclusions, and recommendations for legislative and
 administrative actions considered appropriate to future resolution activities
 by the Corporation.
 `(2) MANNER OF SUBMISSION- Such report shall be submitted to the President of
 the Senate and the Speaker of the House of Representatives, who shall cause
 the same to be printed for the information of Congress, and the President
 as soon as practicable after the first day of January each year.';
 (2) by redesignating subsections (b), (c), and (d) as (e), (f), and (g),
 respectively; and
 (3) by inserting after subsection (a) the following new subsections:
 `(b) QUARTERLY REPORTS TO TREASURY-
 `(1) FINANCIAL OPERATING PLANS AND FORECASTS- Before the beginning of
 each fiscal quarter, the Corporation shall provide to the Secretary of the
 Treasury a copy of the Corporation's financial operating plans and forecasts.
 `(2) FINANCIAL CONDITION AND REPORTS OF OPERATIONS- As soon as practicable
 after the end of each fiscal quarter, the Corporation shall submit to
 the Secretary of the Treasury a copy of the report of the Corporation's
 financial condition as of the end of such fiscal quarter and the results
 of the Corporation's operations during such fiscal quarter.
 `(3) ITEMS TO BE INCLUDED- The plans, forecasts, and reports required under
 this subsection shall reflect the estimates required to be made under section
 15(b) of the liabilities and obligations of the Corporation described in
 such section.
 `(4) RULE OF CONSTRUCTION- The requirement to provide plans, forecasts,
 and reports to the Secretary of the Treasury under this subsection may not
 be construed as implying any obligation on the part of the Corporation to
 obtain the consent or approval of such Secretary with respect to such plans,
 forecasts, and reports.
 `(c) REPORTS TO OMB-
 `(1) FINANCIAL INFORMATION- The Corporation shall continue to provide to
 the Director of the Office of Management and Budget financial information
 consistent with that contained in the reports that were being provided
 to the Director immediately prior to the effective date of the Financial
 Institutions Reform, Recovery, and Enforcement Act of 1989.
 `(2) FINANCIAL OPERATING PLANS AND FORECASTS- The Corporation shall also
 provide to the Director copies of the Corporation's financial operating
 plans and forecasts as prepared by the Corporation in the ordinary course
 of its operations, and copies of the quarterly reports of the Corporation's
 financial condition and results of operations as prepared by the Corporation
 in the ordinary course of its operations.
 `(3) RULE OF CONSTRUCTION- This subsection may not be construed as implying
 any obligation on the part of the Corporation to consult with or obtain
 the consent or approval of the Director with respect to any reports, plans,
 forecasts, or other information referred to in paragraph (1) or (2) or any
 jurisdiction or oversight over the affairs or operations of the Corporation.
 `(d) Audit-
 `(1) AUDIT REQUIRED- The Comptroller General shall audit annually the
 financial transactions of the Corporation, the Bank Insurance Fund,
 the Savings Association Insurance Fund, and the FSLIC Resolution Fund in
 accordance with generally accepted government auditing standards.
 `(2) ACCESS TO BOOKS AND RECORDS- All books, records, accounts, reports,
 files, and property belonging to or used by the Corporation, the Bank
 Insurance Fund, the Savings Association Insurance Fund, and the FSLIC
 Resolution Fund, or by an independent certified public accountant retained
 to audit the Fund's financial statements, shall be made available to the
 Comptroller General.'.
 (b) Specific Reports-
 (1) Risk-based assessments-
 (A) REPORT REQUIRED- The Federal Deposit Insurance Corporation shall study
 the establishment of premium assessment categories related to types of risk
 to the insurance funds and shall report its recommendations to the Congress
 not later than January 1, 1991. If the Corporation should recommend the
 establishment of such a risk-based assessment plan, it shall also provide
 a timetable and plan for implementation.
 (B) CONGRESSIONAL RESPONSE- Not later than 180 days after receipt by the
 Congress of the report required under subparagraph (A) and the accompanying
 plan and timetable, the Congress shall make a recommendation to the
 Chairperson of the Board of Directors regarding the disposition of such
 plan and timetable.
 (2) STUDY OF DEPOSIT INSURANCE PASS-THROUGH- Not later than 6 months
 after the date of enactment of this Act, the Federal Deposit Insurance
 Corporation shall transmit to the Congress a report containing its findings
 and recommendations relating to the pass-through of deposit insurance either
 to individual investors in unit investment trust funds or to individual
 participants in pension or to profit sharing plans qualified under section
 401 of the Internal Revenue Code of 1986. Such report shall also contain
 the Corporation's assessment of the potential effects of broadening deposit
 insurance coverage on the safety of the insurance funds and the operation
 of capital markets.
 (3) Report on directors' and officers' liability insurance-
 (A) STUDY- The Federal Deposit Insurance Corporation shall, together with the
 Secretary of the Treasury and the Attorney General, conduct a comprehensive
 study of directors' and officers' liability insurance and depository
 institution bonds, and the availability of such insurance for directors
 and officers of insured depository institutions. The study shall include--
 (i) consideration of State laws limiting liability for directors and officers;
 (ii) the effect of contractual provisions limiting insurance coverage when
 an institution is placed in receivership or conservatorship;
 (iii) provisions limiting coverage when a claim is made by the Federal
 Deposit Insurance Corporation; and
 (iv) provisions limiting claims made by one insured against another insured.
In addition, the study shall consider the need for such insurance or bonds
and the effect any change in any of the above noted conditions or terms
may have on the future availability of such insurance, and the ability of
depository institutions to attract qualified officers and directors.
 (B) REPORT- Not later than 6 months after the date of enactment of the
 Financial Institutions Reform, Recovery, and Enforcement Act of 1989,
 the Federal Deposit Insurance Corporation, together with the Secretary of
 the Treasury and the Attorney General, shall report the findings from the
 study under subparagraph (A) to the Congress, together with legislative
 recommendations, if appropriate.
SEC. 221. REGULATIONS GOVERNING INSURED DEPOSITORY INSTITUTIONS.
 Section 18 of the Federal Deposit Insurance Act (12 U.S.C. 1828) is amended--
 (1) by striking out `(a)' and the 1st 2 sentences of subsection (a) and
 inserting the following:
`(a) Insurance Logo-
 `(1) INSURED SAVINGS ASSOCIATIONS- Each insured savings association shall
 display at each place of business maintained by such association a sign
 containing only the following items:
 `(A) A statement that insured deposits are backed by the full faith and
 credit of the United States Government.
 `(B) A statement that deposits are federally insured to $100,000.
 `(C) The symbol of an eagle.
The sign shall not contain any reference to a Government agency and shall
accord each item substantially equal prominence.
 `(2) INSURED BANKS- Not later than 30 days after the date of enactment of
 the Financial Institutions Reform, Recovery, and Enforcement Act of 1989,
 each insured bank shall display at each place of business maintained by
 such bank one of the following:
 `(A) The sign required to be displayed by insured banks under regulations
 prescribed by the Corporation in effect on January 1, 1989.
 `(B) The sign prescribed under paragraph (1).
 `(3) REGULATIONS- The Corporation shall prescribe regulations to carry out
 the purposes of this subsection, including regulations governing the manner
 of display or use of such signs, except that the size of the sign prescribed
 under paragraph (1) shall be similar to that prescribed under paragraph
 (2)(A). Initial regulations under this subsection shall be prescribed
 on the date of enactment of the Financial Institutions Recovery, Reform,
 and Enforcement Act of 1989.';
 (2) in subsection (c)--
 (A) in paragraph (2), by striking out subparagraph (C) and inserting the
 following:
 `(C) the Corporation if the acquiring, assuming, or resulting bank is to
 be a State nonmember insured bank (except a District bank or a savings bank
 supervised by the Director of the Office of Thrift Supervision); and
 `(D) the Director of the Office of Thrift Supervision if the acquiring,
 assuming, or resulting institution is to be a savings association.';
 (B) by striking out paragraph (12);
 (C) in paragraphs (3), (4), (6), (7), and (9), by inserting after the word
 `bank' or `banks' each time it appears, the words `or savings association'
 or `or savings associations', respectively; and
 (D) in paragraph (3), by striking out `failure' and inserting in lieu thereof
 `default';
 (3) in subsection (i)(2)--
 (A) by striking out `insured bank' and inserting in lieu thereof `insured
 Federal depository institution';
 (B) by striking out `insured State bank' and inserting in lieu thereof
 `insured State depository institution';
 (C) by striking out the period at the end of subpargraph (C) and inserting
 in lieu thereof `; and';
 (D) by inserting after subparagraph (C) the following new subparagraph:
 `(D) the Director of the Office of Thrift Supervision if the resulting
 institution is to be an insured State savings association.';
 (E) in paragraph (4)(D), by inserting `and fitness' after `character'; and
 (F) by striking out paragraph (5); and
 (4) by adding at the end the following:
 `(m) Activities of Savings Associations and Their Subsidiaries-
 `(1) PROCEDURES- When an insured savings association establishes or acquires
 a subsidiary or when an insured savings association elects to conduct any new
 activity through a subsidiary that the insured savings association controls,
 the insured savings association--
 `(A) shall notify the Corporation and the Director of the Office of Thrift
 Supervision not less than 30 days prior to the establishment, or acquisition,
 of any such subsidiary, and not less than 30 days prior to the commencement
 of any such activity, and in either case shall provide at that time such
 information as each such agency may, by regulation, require; and
 `(B) shall conduct the activities of the subsidiary in accordance with
 regulations and orders of the Director of the Office of Thrift Supervision.
 `(2) ENFORCEMENT POWERS- With respect to any subsidiary of an insured
 savings association:
 `(A) the Corporation and the Director of the Office of Thrift Supervision
 shall each have, with respect to such subsidiary, the respective powers
 that each has with respect to the insured savings association pursuant to
 this section or section 8; and
 `(B) the Director of the Office of Thrift Supervision may determine, after
 notice and opportunity for hearing, that the continuation by the insured
 savings association of its ownership or control of, or its relationship to,
 the subsidiary--
 `(i) constitutes a serious risk to the safety, soundness, or stability of
 the insured savings association, or
 `(ii) is inconsistent with sound banking principles or with the purposes
 of this Act.
Upon making any such determination, the Corporation or the Director of the
Office of Thrift Supervision shall have authority to order the insured
savings association to divest itself of control of the subsidiary. The
Director of the Office of Thrift Supervision may take any other corrective
measures with respect to the subsidiary, including the authority to require
the subsidiary to terminate the activities or operations posing such risks,
as the Director may deem appropriate.
 `(3) Activities incompatible with deposit insurance-
 `(A) IN GENERAL- The Corporation may determine by regulation or order that any
 specific activity poses a serious threat to the Savings Association Insurance
 Fund. Prior to adopting any such regulation, the Corporation shall consult
 with the Director of the Office of Thrift Supervision and shall provide
 appropriate State supervisors the opportunity to comment thereon, and the
 Corporation shall specifically take such comments into consideration. Any
 such regulation shall be issued in accordance with section 553 of title 5,
 United States Code. If the Board of Directors makes such a determination with
 respect to an activity, the Corporation shall have authority to order that no
 Savings Association Insurance Fund member may engage in the activity directly.
 `(B) AUTHORITY OF DIRECTOR- This section does not limit the authority of
 the Office of Thrift Supervision to issue regulations to promote safety
 and soundness or to enforce compliance with other applicable laws.
 `(C) ADDITIONAL AUTHORITY OF FDIC TO PREVENT SERIOUS RISKS TO INSURANCE FUND-
 Notwithstanding subparagraph (A), the Corporation may prescribe and enforce
 such regulations and issue such orders as the Corporation determines to
 be necessary to prevent actions or practices of savings associations that
 pose a serious threat to the Savings Association Insurance Fund or the Bank
 Insurance Fund.
 `(4) `SUBSIDIARY' DEFINED- As used in this subsection, the term `subsidiary'
 does not include an insured depository institution.
 `(5) APPLICABILITY TO CERTAIN SAVINGS BANKS- Subparagraphs (A) and (B)
 of paragraph (1) of this subsection do not apply to--
 `(A) any Federal savings bank that was chartered prior to October 15, 1982,
 as a savings bank under State law, or
 `(B) a savings association that acquired its principal assets from an
 institution that was chartered prior to October 15, 1982, as a savings bank
 under State law.
 `(n) CALCULATION OF CAPITAL- No appropriate Federal banking agency shall
 allow any insured depository institution to include an unidentifiable
 intangible asset in its calculation of compliance with the appropriate
 capital standard, if such unidentifiable intangible asset was acquired
 after April 12, 1989, except to the extent permitted under section 5(t)
 of the Home Owners' Loan Act.'.
SEC. 222. ACTIVITIES OF SAVINGS ASSOCIATIONS.
 The Federal Deposit Insurance Act is amended by adding at the end the
 following new section:
`SEC. 28. ACTIVITIES OF SAVINGS ASSOCIATIONS.
 `(a) IN GENERAL- On and after January 1, 1990, a savings association chartered
 under State law may not engage as principal in any type of activity, or in
 any activity in an amount, that is not permissible for a Federal savings
 association unless--
 `(1) the Corporation has determined that the activity would pose no
 significant risk to the affected deposit insurance fund; and
 `(2) the savings association is and continues to be in compliance with the
 fully phased-in capital standards prescribed under section 5(t) of the Home
 Owners' Loan Act.
 `(b) DIFFERENCES OF MAGNITUDE BETWEEN STATE AND FEDERAL POWERS-
 Notwithstanding subsection (a)(1), if an activity (other than an activity
 described in section 5(c)(2)(B) of the Home Owners' Loan Act) is permissible
 for a Federal savings association, a savings association chartered under
 State law may engage as principal in that activity in an amount greater
 than the amount permissible for a Federal savings association if--
 `(1) the Corporation has not determined that engaging in that amount of
 the activity poses any significant risk to the affected deposit insurance
 fund; and
 `(2) the savings association chartered under State law is and continues
 to be in compliance with the fully phased-in capital standards prescribed
 under section 5(t) of the Home Owners' Loan Act.
 `(c) EQUITY INVESTMENTS BY STATE SAVINGS ASSOCIATIONS-
 `(1) IN GENERAL- Notwithstanding subsections (a) and (b), a savings
 association chartered under State law may not directly acquire or retain
 any equity investment of a type or in an amount that is not permissible
 for a Federal savings association.
 `(2) EXCEPTION FOR SERVICE CORPORATIONS- Paragraph (1) does not prohibit
 a savings association from acquiring or retaining shares of one or more
 service corporations if--
 `(A) the Corporation has determined that no significant risk to the affected
 deposit insurance fund is posed by--
 `(i) the amount that the association proposes to invest in those shares (or,
 in the case of shares held on May 1, 1989, the amount that the association
 has invested in those shares), or
 `(ii) the activities in which the service corporation engages; and
 `(B) the savings association is and continues to be in compliance with the
 fully phased-in capital standards prescribed under section 5(t) of the Home
 Owners' Loan Act.
 `(3) TRANSITION RULE-
 `(A) IN GENERAL- The Corporation shall require any savings association
 to divest any equity investment the retention of which is not permissible
 under paragraph (1) or (2) as quickly as can be prudently done, and in any
 event not later than July 1, 1994.
 `(B) TREATMENT OF NONCOMPLIANCE DURING DIVESTMENT- With respect to any equity
 investment held by any savings association on May 1, 1989, the savings
 association shall be deemed not to be in violation of the prohibition in
 paragraph (1) or (2) on retaining such investment so long as the savings
 association complies with any applicable requirement established by the
 Corporation pursuant to subparagraph (A) for divesting such investments.
 `(d) CORPORATE DEBT SECURITIES NOT OF INVESTMENT GRADE-
 `(1) IN GENERAL- No savings association may, directly or through a subsidiary,
 acquire or retain any corporate debt security not of investment grade.
 `(2) EXCEPTION FOR SECURITIES HELD BY QUALIFIED AFFILIATE- Paragraph
 (1) shall not apply with respect to any corporate debt security not of
 investment grade which is acquired and retained by any qualified affiliate
 of a savings association.
 `(3) TRANSITION RULE-
 `(A) IN GENERAL- The Corporation shall require any savings association
 or any subsidiary of any savings association to divest any corporate debt
 security not of investment grade the retention of which is not permissible
 under paragraph (1) as quickly as can be prudently done, and in any event
 not later than July 1, 1994.
 `(B) TREATMENT OF NONCOMPLIANCE DURING DIVESTMENT- With respect to any
 corporate debt security not of investment grade held by any savings
 association or subsidiary on the date of enactment of the Financial
 Institutions Reform, Recovery, and Enforcement Act of 1989, the savings
 association or subsidiary shall be deemed not to be in violation of the
 prohibition in paragraph (1) on retaining such investment so long as the
 association or subsidiary complies with any applicable requirement established
 by the Corporation pursuant to subparagraph (A) for divesting such securities.
 `(4) DEFINITIONS- For purposes of this section--
 `(A) INVESTMENT GRADE- Any corporate debt security is not of `investment
 grade' unless that security, when acquired by the savings association or
 subsidiary, was rated in one of the 4 highest rating categories by at least
 one nationally recognized statistical rating organization.
 `(B) QUALIFIED AFFILIATE- The term `qualified affiliate' means--
 `(i) in the case of a stock savings association, an affiliate other than
 a subsidiary or an insured depository institution; and
 `(ii) in the case of a mutual savings association, a subsidiary other than an
 insured depository institution, so long as all of the savings association's
 investments in and extensions of credit to the subsidiary are deducted from
 the savings association's capital.
 `(C) CERTAIN SECURITIES NOT INCLUDED- The term `corporate debt security not
 of investment grade' does not include any obligation issued or guaranteed
 by a corporation that may be held by a Federal savings association without
 limitation as to percentage of assets under subparagraphs (D), (E), or (F)
 of section 5(c)(1) of the Home Owners' Loan Act.
 `(e) TRANSFER OF CORPORATE DEBT SECURITY NOT OF INVESTMENT GRADE IN EXCHANGE
 FOR A QUALIFIED NOTE-
 `(1) ACQUISITION OF NOTE- Notwithstanding subsections (a), (b), and (c) of
 section 5 of the Home Owners' Loan Act and any other provision of Federal or
 State law governing extensions of credit by savings associations, any insured
 savings association, and any subsidiary of any insured savings association,
 that, on the date of the enactment of the Financial Institutions Reform,
 Recovery, and Enforcement Act of 1989, holds any corporate debt security
 not of investment grade may acquire a qualified note in exchange for the
 transfer of such security to--
 `(A) any holding company which controls 80 percent or more of the shares
 of such insured savings association; or
 `(B) any company other than an insured savings association, or any subsidiary
 of any insured savings association, 80 percent or more of the shares of
 which are controlled by such holding company,
if the conditions of paragraph (2) are met.
 `(2) CONDITIONS FOR EXCHANGE OF SECURITY FOR QUALIFIED NOTE- The conditions
 of this paragraph are met if--
 `(A) the insured savings association was in compliance with applicable
 capital requirements on December 31, 1988, and the insured savings association
 after such date--
 `(i) remains in compliance with applicable capital requirements; or
 `(ii) adopts and complies with a capital plan acceptable to the Director
 of the Office of Thrift Supervision;
 `(B) the company to which the corporate debt security not of investment
 grade is transferred is not a bank holding company, an insured savings
 association, or a direct or indirect subsidiary of such holding company or
 insured savings association;
 `(C) before the end of the 90-day period beginning on the date of the
 enactment of the Financial Institutions Reform, Recovery, and Enforcement
 Act of 1989, the insured savings association notifies the Director of the
 Office of Thrift Supervision of such association's intention to transfer
 the corporate debt security not of investment grade to the savings and loan
 holding company or the subsidiary of such holding company;
 `(D) the transfer of the corporate debt security not of investment grade
 is completed--
 `(i) before the end of the 1-year period beginning on the date of the
 enactment of the Financial Institutions Reform, Recovery, and Enforcement
 Act of 1989, in the case of an insured savings association that, as of such
 date, is controlled by a savings and loan holding company; or
 `(ii) before the end of the 2-year period beginning on such date, in the
 case of a savings association that is not, as of such date, a subsidiary
 of a savings and loan holding company;
 `(E) the insured savings association receives in exchange for the corporate
 debt security not of investment grade the fair market value of such security;
 `(F) the Director of the Office of Thrift Supervision has--
 `(i) approved the transaction; and
 `(ii) determined that the transfer represents a complete and effective
 divestiture of the corporate debt security not of investment grade and is
 in compliance with the provisions of this subsection; and
 `(G) any gain on the sale of the corporate debt security not of investment
 grade is recognized, and included for applicable regulatory capital
 requirements, by the insured savings association only at such time and to the
 extent that the insured savings association receives payment of principal
 on the note in cash in excess of the fair market value of the transferred
 corporate debt security not of investment grade as carried on the accounts
 of the insured savings association immediately prior to the transfer.
 `(3) QUALIFIED NOTE DEFINED- The term `qualified note' means any note that--
 `(A) is at all times fully secured by the corporate debt security not
 of investment grade transferred in exchange for the note, or by other
 collateral of at least equivalent value that is acceptable to the Director
 of the Office of Thrift Supervision;
 `(B) contains provisions acceptable to the Director of the Office of Thrift
 Supervision that would--
 `(i) prevent any action to encumber or impair the value of the collateral
 referred to in subparagraph (A); and
 `(ii) allow the sale of the corporate debt security not of investment grade
 if the proceeds of the sale are reinvested in assets of equivalent value;
 `(C) is on market terms, including interest rate, which must in all cases be
 above the insured savings association's borrowing rate for similar term funds;
 `(D) is fully repayable over a period of time not to exceed 5 years from
 the date of transfer;
 `(E) is repaid with annual principal payments at least as large as would
 be necessary to repay the note within 5 years if it were on a level payment
 amortization schedule and the interest rate for the first year of repayment
 were fixed throughout the amortization period;
 `(F) is fully guaranteed by each holding company of the insured savings
 association that acquires such note; and
 `(G) is repaid in full in cash in accordance with its terms and this
 subsection.
 `(4) FAILURE TO REPAY ON SCHEDULE- The exemption provided by this subsection
 from subsections (a), (b), and (c) of section 11 of the Home Owners' Loan
 Act any other applicable provision of Federal or State law shall terminate
 immediately if the insured savings association or any affiliate of such
 association fails to comply with the terms of the qualified note or this
 subsection.
 `(f) DETERMINATIONS- The Corporation shall make determinations under this
 section by regulation or order.
 `(g) ACTIVITY DEFINED- For purposes of subsections (a) and (b)--
 `(1) IN GENERAL- The term `activity' includes acquiring or retaining any
 investment.
 `(2) DIVESTITURE OF CERTAIN ASSETS-  Notwithstanding paragraph (1),
 subsections (a) and (b) shall not be construed to require a savings
 association to divest itself of any assets acquired before the date of
 enactment of the Financial Institutions Reform, Recovery, and Enforcement
 Act of 1989.
 `(h) DISCLOSURES BY UNINSURED SAVINGS ASSOCIATIONS-
 `(1) IN GENERAL- Any savings association the deposits of which are not insured
 by the Corporation under this Act shall disclose clearly and conspicuously
 in periodic statements of account and in all advertising that the savings
 association's deposits are `not federally insured'.
 `(2) MANNER AND CONTENT- The Corporation may, by regulation or order,
 prescribe the manner and content of the disclosure.
 `(3) ENFORCEMENT- Compliance with the requirements of this subsection, and
 any regulation prescribed or order issued under this subsection, shall be
 enforced under section 8 in the same manner and to the same extent as if
 the savings association were an insured State nonmember bank.
 `(i) OTHER AUTHORITY NOT AFFECTED- This section may not be construed as
 limiting--
 `(1) any other authority of the Corporation; or
 `(2) any authority of the Director of the Office of Thrift Supervision or
 of a State to impose more stringent restrictions.'.
SEC. 223. NONDISCRIMINATION.
 Section 22 of the Federal Deposit Insurance Act (12 U.S.C. 1830) is amended
 to read as follows:
`SEC. 22. NONDISCRIMINATION.
 `It is not the purpose of this Act to discriminate in any manner against
 State nonmember banks or State savings associations and in favor of national
 or member banks or Federal savings associations, respectively. It is the
 purpose of this Act to provide all banks and savings associations with the
 same opportunity to obtain and enjoy the benefits of this Act.'.
SEC. 224. BROKERED DEPOSITS.
 (a) IN GENERAL- The Federal Deposit Insurance Act is amended by inserting
 after section 28 (as added by section 222 of this title) the following
 new section:
`SEC. 29. BROKERED DEPOSITS.
 `(a) IN GENERAL- A troubled institution may not accept funds obtained,
 directly or indirectly, by or through any deposit broker for deposit into
 1 or more deposit accounts.
 `(b) RENEWALS AND ROLLOVERS TREATED AS ACCEPTANCE OF FUNDS- Any renewal of
 an account in any troubled institution and any rollover of any amount on
 deposit in any such account shall be treated as an acceptance of funds by
 such troubled institution for purposes of subsection (a).
 `(c) WAIVER AUTHORITY- The Corporation may, on a case-by-case basis and upon
 application by an insured depository institution, waive the applicability
 of subsection (a) upon a finding that the acceptance of such deposits does
 not constitute an unsafe or unsound practice with respect to such institution.
 `(d) LIMITED EXCEPTION FOR CERTAIN CONSERVATORSHIPS- In the case of any
 insured depository institution for which the Corporation has been appointed
 as conservator, subsection (a) shall not apply to the acceptance of deposits
 (described in such subsection) by such institution if the Corporation
 determines that the acceptance of such deposits--
 `(1) is not an unsafe or unsound practice; and
 `(2) either--
 `(A) is necessary to enable the institution to meet the demands of its
 depositors or pay its obligations in the ordinary course of business; or
 `(B) is consistent with the conservator's fiduciary duty to minimize the
 losses of the institution.
 `(e) ADDITIONAL RESTRICTIONS- The Corporation may impose, by regulation or
 order, such additional restrictions on the acceptance of brokered deposits by
 any troubled institution as the Corporation may determine to be appropriate.
 `(f) DEFINITIONS RELATING TO DEPOSIT BROKER-
 `(1) DEPOSIT BROKER- The term `deposit broker' means--
 `(A) any person engaged in the business of placing deposits, or facilitating
 the placement of deposits, of third parties with insured depository
 institutions or the business of placing deposits with insured depository
 institutions for the purpose of selling interests in those deposits to
 third parties; and
 `(B) an agent or trustee who establishes a deposit account to facilitate
 a business arrangement with an insured depository institution to use the
 proceeds of the account to fund a prearranged loan.
 `(2) EXCLUSIONS- The term `deposit broker' does not include--
 `(A) an insured depository institution, with respect to funds placed with
 that depository institution;
 `(B) an employee of an insured depository institution, with respect to
 funds placed with the employing depository institution;
 `(C) a trust department of an insured depository institution, if the trust
 in question has not been established for the primary purpose of placing
 funds with insured depository institutions;
 `(D) the trustee of a pension or other employee benefit plan, with respect
 to funds of the plan;
 `(E) a person acting as a plan administrator or an investment adviser in
 connection with a pension plan or other employee benefit plan provided that
 that person is performing managerial functions with respect to the plan;
 `(F) the trustee of a testamentary account;
 `(G) the trustee of an irrevocable trust (other than one described in
 paragraph (1)(B)), as long as the trust in question has not been established
 for the primary purpose of placing funds with insured depository institutions;
 `(H) a trustee or custodian of a pension or profitsharing plan qualified
 under section 401(d) or 403(a) of the Internal Revenue Code of 1986; or
 `(I) an agent or nominee whose primary purpose is not the placement of
 funds with depository institutions.
 `(3) INCLUSION OF DEPOSITORY INSTITUTIONS ENGAGING IN CERTAIN ACTIVITIES-
 Notwithstanding paragraph (2), the term `deposit broker' includes any
 insured depository institution, and any employee of any insured depository
 institution, which engages, directly or indirectly, in the solicitation
 of deposits by offering rates of interest (with respect to such deposits)
 which are significantly higher than the prevailing rates of interest on
 deposits offered by other insured depository institutions having the same
 type of charter in such depository institution's normal market area.
 `(4) EMPLOYEE- For purposes of this subsection, the term `employee' means
 any employee--
 `(A) who is employed exclusively by the insured depository institution;
 `(B) whose compensation is primarily in the form of a salary;
 `(C) who does not share such employee's compensation with a deposit broker;
 and
 `(D) whose office space or place of business is used exclusively for the
 benefit of the insured depository institution which employs such individual.
 `(g) TROUBLED INSTITUTION DEFINED- The term `troubled institution' means
 any insured depository institution which does not meet the minimum capital
 requirements applicable with respect to such institution.'.
 (b) EFFECTIVE DATE- The amendment made by subsection (a) shall apply to
 deposits accepted after the end of the 180-day period beginning on the date
 of the enactment of this Act.
SEC. 225. CONTRACTS BETWEEN DEPOSITORY INSTITUTIONS AND PERSONS PROVIDING
GOODS, PRODUCTS, OR SERVICES.
 The Federal Deposit Insurance Act (12 U.S.C. 1811 et seq.) is amended by
 inserting after section 29 (as added by section 224 of this title) the
 following new section:
`SEC. 30. CONTRACTS BETWEEN DEPOSITORY INSTITUTIONS AND PERSONS PROVIDING
GOODS, PRODUCTS, OR SERVICES.
 `(a) IN GENERAL- An insured depository institution may not enter into
 a written or oral contract with any person to provide goods, products,
 or services to or for the benefit of such depository institution if the
 performance of such contract would adversely affect the safety or soundness
 of the institution.
 `(b) RULEMAKING- The Corporation shall prescribe such regulations and issue
 such orders, including definitions consistent with this section, as may be
 necessary to administer and carry out the purposes of, and prevent evasions
 of, this section.
 `(c) ENFORCEMENT- Any action taken by any appropriate Federal banking
 agency under section 8 to enforce compliance on the part of any insured
 depository institution with the requirements of this section may include a
 requirement that such institution properly reflect the transaction on its
 books and records.
 `(d) NO PRIVATE RIGHT OF ACTION- This section may not be construed as
 creating any private right of action.
 `(e) STUDY-
 `(1) IN GENERAL- The Attorney General and the Comptroller General of the
 United States shall jointly conduct a study on the extent to which--
 `(A) insured depository institutions are entering into contracts with
 vendors under which venders agree to purchase stock or assets from insured
 depository institutions or to invest capital in or make deposits in such
 institutions; and
 `(B) if such practices occur, the extent to which such practices are having
 an anticompetitive effect and should be prohibited.
 `(2) REPORT TO CONGRESS- Before the end of the 1-year period beginning on
 the date of the enactment of the Financial Institutions Reform, Recovery,
 and Enforcement Act of 1989, the Attorney General and the Comptroller General
 shall submit a report to the Congress on the results of the study conducted
 pursuant to paragraph (1).'.
SEC. 226. SAVINGS ASSOCIATION INSURANCE FUND INDUSTRY ADVISORY COMMITTEE
ESTABLISHED.
 The Federal Deposit Insurance Act (12 U.S.C. 1811 et seq.) is amended by
 inserting after section 30 (as added by section 225 of this title) the
 following new section:
`SEC. 31. SAVINGS ASSOCIATION INSURANCE FUND INDUSTRY ADVISORY COMMITTEE.
 `(a) ESTABLISHMENT- There is hereby established the Savings Association
 Insurance Fund Industry Advisory Committee (hereinafter referred to in this
 section as the `Committee').
 `(b) MEMBERSHIP- The Committee shall consist of 18 members, appointed
 as follows:
 `(1) 1 member elected from each Federal home loan bank district (by the
 members of the Board of Directors of each such bank who were elected by
 the members of such bank) from among individuals residing therein who are
 officers of insured depository institutions that are Savings Association
 Insurance Fund members.
 `(2) 6 members appointed by the Corporation from among individuals who
 shall represent the public interest.
 `(c) VACANCIES- Any vacancy on the Committee shall be filled in the same
 manner in which the original appointment was made.
 `(d) PAY AND EXPENSES- Members of the Committee shall serve without pay,
 but each member shall be reimbursed, in such manner as the Corporation
 shall prescribe by regulation, for expenses incurred in connection with
 attendance of such members at meetings of the Committee.
 `(e) TERMS- Members shall be appointed or elected for terms of 1 year.
 `(f) AUTHORITY OF THE COMMITTEE- The Committee may select its Chairperson,
 Vice Chairperson, and Secretary, and adopt methods of procedure, and shall
 have power--
 `(1) to confer with the Board of Directors on general and special business
 conditions and regulatory and other matters affecting insured financial
 institutions that are members of the Savings Association Insurance Fund; and
 `(2) to request information, and to make recommendations, with respect to
 matters within the jurisdiction of the Corporation.
 `(g) MEETINGS- The Committee shall meet 4 times each year, and more frequently
 if requested by the Corporation.
 `(h) REPORTS- The Committee shall submit a semiannual written report to
 the Committee on Banking, Finance and Urban Affairs of the House and to the
 Committee on Banking, Housing, and Urban Affairs of the Senate. Such report
 shall describe the activities of the Committee for such semiannual period
 and contain such recommendations as the Committee considers appropriate.
 `(i) PROVISION OF STAFF AND OTHER RESOURCES- The Corporation shall provide
 the Committee with the use of such resources, including staff, as the
 Committee reasonably shall require to carry out its duties, including the
 preparation and submission of reports to Congress, under this section.
 `(j) FEDERAL ADVISORY COMMITTEE ACT DOES NOT APPLY- The Federal Advisory
 Committee Act shall not apply to the Committee.
 `(k) SUNSET- The Committee shall cease to exist 10 years after the enactment
 of this section.'.
TITLE III--SAVINGS ASSOCIATIONS
SEC. 301. AMENDMENT TO HOME OWNERS' LOAN ACT OF 1933.
 The Home Owners' Loan Act of 1933 is amended to read as follows:
`SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.
 `This Act may be cited as the `Home Owners' Loan Act'.
`TABLE OF CONTENTS
`Sec. 1. Short title and table of contents.
`Sec. 2. Definitions.
`Sec. 3. Director of the Office of Thrift Supervision.
`Sec. 4. Supervision of savings associations.
`Sec. 5. Federal savings associations.
`Sec. 6. Liquid asset requirements.
`Sec. 7. Applicability.
`Sec. 8. District associations.
`Sec. 9. Examination fees.
`Sec. 10. Regulation of holding companies.
`Sec. 11. Transactions with affiliates; extensions of credit to executive
officers, directors, and principal shareholders.
`Sec. 12. Advertising.
`Sec. 13. Powers of examiners.
`Sec. 14. Separability provision.
`SEC. 2. DEFINITIONS.
 `For purposes of this Act--
 `(1) DIRECTOR- The term `Director' means the Director of the Office of
 Thrift Supervision.
 `(2) CORPORATION- The term `Corporation' means the Federal Deposit Insurance
 Corporation.
 `(3) OFFICE- The term `Office' means the Office of Thrift Supervision.
 `(4) SAVINGS ASSOCIATION- The term `savings association' means a savings
 association, as defined in section 3 of the Federal Deposit Insurance Act,
 the deposits of which are insured by the Corporation.
 `(5) FEDERAL SAVINGS ASSOCIATION- The term `Federal savings association'
 means a Federal savings association or a Federal savings bank chartered
 under section 5 of this Act.
 `(6) NATIONAL BANK- The term `national bank' has the same meaning as in
 section 3 of the Federal Deposit Insurance Act.
 `(7) FEDERAL BANKING AGENCIES- The term `Federal banking agencies' means
 the Office of the Comptroller of the Currency, the Board of Governors of
 the Federal Reserve System, and the Federal Deposit Insurance Corporation.
 `(8) STATE- The term `State' has the same meaning as in section 3 of the
 Federal Deposit Insurance Act.
 `(9) AFFILIATE- The term `affiliate' means any person that controls, is
 controlled by, or is under common control with, a savings association,
 except as provided in section 10.
`SEC. 3. DIRECTOR OF THE OFFICE OF THRIFT SUPERVISION.
 `(a) ESTABLISHMENT OF OFFICE- There is established the Office of Thrift
 Supervision, which shall be an office in the Department of the Treasury.
 `(b) ESTABLISHMENT OF POSITION OF DIRECTOR-
 `(1) IN GENERAL- There is established the position of the Director of the
 Office of Thrift Supervision, who shall be the head of the Office of Thrift
 Supervision and shall be subject to the general oversight of the Secretary
 of the Treasury.
 `(2) AUTHORITY TO PRESCRIBE REGULATIONS- The Director may prescribe such
 regulations and issue such orders as the Director may determine to be
 necessary for carrying out this Act and all other laws within the Director's
 jurisdiction.
 `(3) AUTONOMY OF DIRECTOR- The Secretary of the Treasury may not intervene in
 any matter or proceeding before the Director unless otherwise provided by law.
 `(c) APPOINTMENT; TERM-
 `(1) APPOINTMENT- The Director shall be appointed by the President, by and
 with the advice and consent of the Senate, from among individuals who are
 citizens of the United States.
 `(2) TERM- The Director shall be appointed for a term of 5 years.
 `(3) VACANCY- A vacancy in the position of Director which occurs before the
 expiration of the term for which a Director was appointed shall be filled
 in the manner established in paragraph (1) and the Director appointed to
 fill such vacancy shall be appointed only for the remainder of such term.
 `(4) SERVICE AFTER END OF TERM- An individual may serve as Director after
 the expiration of the term for which appointed until a successor Director
 has been appointed.
 `(5) TRANSITIONAL PROVISION- Notwithstanding paragraphs (1) and (2), the
 Chairman of the Federal Home Loan Bank Board on the date of enactment of
 the Financial Institutions Reform, Recovery, and Enforcement Act of 1989,
 shall be the Director until the date on which that individual's term as
 Chairman of the Federal Home Loan Bank Board would have expired.
 `(d) PROHIBITION ON FINANCIAL INTERESTS- The Director shall not have a
 direct or indirect financial interest in any insured depository institution,
 as defined in section 3 of the Federal Deposit Insurance Act.
 `(e) POWERS OF THE DIRECTOR- The Director shall have all powers which--
 `(1) were vested in the Federal Home Loan Bank Board (in the Board's capacity
 as such) or the Chairman of such Board on the day before the date of the
 enactment of the Financial Institutions Reform, Recovery, and Enforcement
 Act of 1989; and
 `(2) were not--
 `(A) transferred to the Federal Deposit Insurance Corporation, the Federal
 Housing Finance Board, the Resolution Trust Corporation, or the Federal
 Home Loan Mortgage Corporation pursuant to any amendment made by such Act; or
 `(B) established under any provision of law repealed by such Act.
 `(f) ANNUAL REPORT REQUIRED- The Director shall make an annual report to
 the Congress. Such report shall include--
 `(1) a description of any changes the Director has made or is considering
 making in the district offices of the Office, including a description of
 the geographic allocation of the Office's resources and personnel used to
 carry out examination and supervision functions; and
 `(2) a description of actions taken to carry out section 308 of the Financial
 Institutions Reform, Recovery, and Enforcement Act of 1989.
 `(g) STAFF-
 `(1) APPOINTMENT AND COMPENSATION- The Director shall fix the compensation
 and number of, and appoint and direct, all employees of the Office of Thrift
 Supervision notwithstanding section 301(f)(1) of title 31, United States
 Code. Such compensation shall be paid without regard to the provisions of
 other laws applicable to officers or employees of the United States.
 `(2) RATES OF BASIC PAY- Rates of basic pay for employees of the Office
 may be set and adjusted by the Director without regard to the provisions
 of chapter 51 or subchapter III of chapter 53 of title 5, United States Code.
 `(3) ADDITIONAL COMPENSATION AND BENEFITS- The Director may provide additional
 compensation and benefits to employees of the Office if the same type of
 compensation or benefits are then being provided by any Federal banking agency
 or, if not then being provided, could be provided by such an agency under
 applicable provisions of law, rule, or regulation. In setting and adjusting
 the total amount of compensation and benefits for employees of the Office,
 the Director shall consult, and seek to maintain comparability with, the
 Federal banking agencies.
 `(4) DELEGATION AUTHORITY-
 `(A) IN GENERAL- The Director may--
 `(i) designate who shall act as Director in the Director's absence; and
 `(ii) delegate to any employee, representative, or agent any power of
 the Director.
 `(B) LIMITATIONS- Notwithstanding subparagraph (A)(ii), the Director shall
 not, directly or indirectly--
 `(i) after October 10, 1989, delegate to any Federal home loan bank or to
 any officer, director, or employee of a Federal home loan bank, any power
 involving examining, supervising, taking enforcement action with respect to,
 or otherwise regulating any savings association, savings and loan holding
 company, or other person subject to regulation by the Director; or
 `(ii) delegate the Director's authority to serve as a member of the
 Corporation's Board of Directors.
 `(h) FUNDING THROUGH ASSESSMENTS- The compensation of the Director and
 other employees of the Office and all other expenses thereof may be paid
 from assessments levied under this Act.
 `(i) GAO AUDIT- The Director shall make available to the Comptroller General
 of the United States all books and records necessary to audit all of the
 activities of the Office of Thrift Supervision.
`SEC. 4. SUPERVISION OF SAVINGS ASSOCIATIONS.
 `(a) FEDERAL SAVINGS ASSOCIATIONS-
 `(1) IN GENERAL- The Director shall provide for the examination, safe and
 sound operation, and regulation of savings associations.
 `(2) REGULATIONS- The Director may issue such regulations as the Director
 determines to be appropriate to carry out the responsibilities of the
 Director or the Office.
 `(3) SAFE AND SOUND HOUSING CREDIT TO BE ENCOURAGED- The Director shall
 exercise all powers granted to the Director under this Act so as to encourage
 savings associations to provide credit for housing safely and soundly.
 `(b) ACCOUNTING AND DISCLOSURE-
 `(1) IN GENERAL- The Director shall, by regulation, prescribe uniform
 accounting and disclosure standards for savings associations, to be used in
 determining savings associations' compliance with all applicable regulations.
 `(2) SPECIFIC REQUIREMENTS FOR ACCOUNTING STANDARDS- Subject to section 5(t),
 the uniform accounting standards prescribed under paragraph (1) shall--
 `(A) incorporate generally accepted accounting principles to the same degree
 that such principles are used to determine compliance with regulations
 prescribed by the Federal banking agencies;
 `(B) allow for no deviation from full compliance with such standards as
 are in effect after December 31, 1993; and
 `(C) prior to January 1, 1994, require full compliance by savings associations
 with accounting standards in effect at any time before such date not later
 than provided under the schedule in section 563.23-3 of title 12, Code of
 Federal Regulations (as in effect on May 1, 1989).
 `(3) AUTHORITY TO PRESCRIBE MORE STRINGENT ACCOUNTING STANDARDS- The
 Director may at any time prescribe accounting standards more stringent
 than required under paragraph (2) if the Director determines that the more
 stringent standards are necessary to ensure the safe and sound operation
 of savings associations.
 `(c) STRINGENCY OF STANDARDS- All regulations and policies of the Director
 governing the safe and sound operation of savings associations, including
 regulations and policies governing asset classification and appraisals,
 shall be no less stringent than those established by the Comptroller of
 the Currency for national banks.
 `(d) INVESTMENT OF CERTAIN FUNDS IN ACCOUNTS OF SAVINGS ASSOCIATIONS- The
 savings accounts and share accounts of savings associations insured by the
 Corporation shall be lawful investments and may be accepted as security for
 all public funds of the United States, fiduciary and trust funds under the
 authority or control of the United States or any officer thereof, and for
 the funds of all corporations organized under the laws of the United States
 (subject to any regulatory authority otherwise applicable), regardless of
 any limitation of law upon the investment of any such funds or upon the
 acceptance of security for the investment or deposit of any of such funds.
 `(e) PARTICIPATION BY SAVINGS ASSOCIATIONS IN LOTTERIES AND RELATED
 ACTIVITIES-
 `(1) PARTICIPATION PROHIBITED- No savings association may--
 `(A) deal in lottery tickets;
 `(B) deal in bets used as a means or substitute for participation in
 a lottery;
 `(C) announce, advertise, or publicize the existence of any lottery; or
 `(D) announce, advertise, or publicize the existence or identity of any
 participant or winner, as such, in a lottery.
 `(2) USE OF FACILITIES PROHIBITED- No savings association may permit--
 `(A) the use of any part of any of its own offices by any person for any
 purpose forbidden to the institution under paragraph (1); or
 `(B) direct access by the public from any of its own offices to any
 premises used by any person for any purpose forbidden to the institution
 under paragraph (1).
 `(3) DEFINITIONS- For purposes of this subsection--
 `(A) DEAL IN- The term `deal in' includes making, taking, buying, selling,
 redeeming, or collecting.
 `(B) LOTTERY- The term `lottery' includes any arrangement under which--
 `(i) 3 or more persons (hereafter in this subparagraph referred to as the
 `participants') advance money or credit to another in exchange for the
 possibility or expectation that 1 or more but not all of the participants
 (hereafter in this paragraph referred to as the `winners') will receive
 by reason of those participants' advances more than the amounts those
 participants have advanced; and
 `(ii) the identity of the winners is determined by any means which includes--
 `(I) a random selection;
 `(II) a game, race, or contest; or
 `(III) any record or tabulation of the result of 1 or more events in which
 any participant has no interest except for the bearing that event has on
 the possibility that the participant may become a winner.
 `(C) LOTTERY TICKET- The term `lottery ticket' includes any right, privilege,
 or possibility (and any ticket, receipt, record, or other evidence of any
 such right, privilege, or possibility) of becoming a winner in a lottery.
 `(4) EXCEPTION FOR STATE LOTTERIES- Paragraphs (1) and (2) shall not apply
 with respect to any savings association accepting funds from, or performing
 any lawful services for, any State operating a lottery, or any officer or
 employee of such a State who is charged with administering the lottery.
 `(5) REGULATIONS- The Director shall prescribe such regulations as may be
 necessary to provide for enforcement of this subsection and to prevent any
 evasion of any provision of this subsection.
 `(f) FEDERALLY RELATED MORTGAGE LOAN DISCLOSURES- A savings association may
 not make a federally related mortgage loan to an agent, trustee, nominee,
 or other person acting in a fiduciary capacity without requiring that the
 identity of the person receiving the beneficial interest of such loan shall
 at all times be revealed to the savings association. At the request of the
 Director, the savings association shall report to the Director the identity
 of such person and the nature and amount of the loan.
 `(g) PREEMPTION OF STATE USURY LAWS- (1) Notwithstanding any State law,
 a savings association may charge interest on any extension of credit at a
 rate of not more than 1 percent in excess of the discount rate on 90-day
 commercial paper in effect at the Federal Reserve bank in the Federal
 Reserve district in which such savings association is located or at the
 rate allowed by the laws of the State in which such savings association is
 located, whichever is greater.
 `(2) If the rate prescribed in paragraph (1) exceeds the rate such savings
 association would be permitted to charge in the absence of this subsection,
 the receiving or charging a greater rate of interest than that prescribed
 by paragraph (1), when knowingly done, shall be deemed a forfeiture of the
 entire interest which the extension of credit carries with it, or which has
 been agreed to be paid thereon. If such greater rate of interest has been
 paid, the person who paid it may recover, in a civil action commenced in
 a court of appropriate jurisdiction not later than 2 years after the date
 of such payment, an amount equal to twice the amount of the interest paid
 from the savings association taking or receiving such interest.
 `(h) FORM AND MATURITY OF SECURITIES- No savings association shall--
 `(1) issue securities which guarantee a definite maturity except with the
 specific approval of the Director, or
 `(2) issue any securities the form of which has not been approved by the
 Director.
`SEC. 5. FEDERAL SAVINGS ASSOCIATIONS.
 `(a) IN GENERAL- In order to provide thrift institutions for the deposit
 of funds and for the extension of credit for homes and other goods and
 services, the Director is authorized, under such regulations as the Director
 may prescribe--
 `(1) to provide for the organization, incorporation, examination, operation,
 and regulation of associations to be known as Federal savings associations
 (including Federal savings banks), and
 `(2) to issue charters therefor,
giving primary consideration of the best practices of thrift institutions
in the United States. The lending and investment powers conferred by this
section are intended to encourage such institutions to provide credit for
housing safely and soundly.
 `(b) Deposits and Related Powers-
 `(1) Deposit accounts-
 `(A) Subject to the terms of its charter and regulations of the Director,
 a Federal savings association may--
 `(i) raise funds through such deposit, share, or other accounts, including
 demand deposit accounts (hereafter in this section referred to as
 `accounts'); and
 `(ii) issue passbooks, certificates, or other evidence of accounts.
 `(B) A Federal savings association may not--
 `(i) pay interest on a demand account; or
 `(ii) permit any overdraft (including an intraday overdraft) on behalf of an
 affiliate, or incur any such overdraft in such savings association's account
 at a Federal reserve bank or Federal home loan bank on behalf of an affiliate.
All savings accounts and demand accounts shall have the same priority upon
liquidation. Holders of accounts and obligors of a Federal savings association
shall, to such extent as may be provided by its charter or by regulations
of the Director, be members of the savings association, and shall have such
voting rights and such other rights as are thereby provided.
 `(C) A Federal savings association may require not less than 14 days notice
 prior to payment of savings accounts if the charter of the savings association
 or the regulations of the Director so provide.
 `(D) If a Federal savings association does not pay all withdrawals in full
 (subject to the right of the association, where applicable, to require
 notice), the payment of withdrawals from accounts shall be subject to such
 rules and procedures as may be prescribed by the savings association's
 charter or by regulation of the Director. Except as authorized in writing
 by the Director, any Federal savings association that fails to make full
 payment of any withdrawal when due shall be deemed to be in an unsafe or
 unsound condition.
 `(E) Accounts may be subject to check or to withdrawal or transfer on
 negotiable or transferable or other order or authorization to the Federal
 savings association, as the Director may by regulation provide.
 `(F) A Federal savings association may establish remote service units for the
 purpose of crediting savings or demand accounts, debiting such accounts,
 crediting payments on loans, and the disposition of related financial
 transactions, as provided in regulations prescribed by the Director.
 `(2) OTHER LIABILITIES- To such extent as the Director may authorize in
 writing, a Federal savings association may borrow, may give security, may be
 surety as defined by the Director and may issue such notes, bonds, debentures,
 or other obligations, or other securities, including capital stock.
 `(3) Loans from state housing finance agencies-
 `(A) IN GENERAL- Subject to regulation by the Director but without regard
 to any other provision of this subsection, any Federal savings association
 that is in compliance with the capital standards in effect under subsection
 (t) may borrow funds from a State mortgage finance agency of the State in
 which the head office of such savings association is situated to the same
 extent as State law authorizes a savings association organized under the
 laws of such State to borrow from the State mortgage finance agency.
 `(B) INTEREST RATE- A Federal savings association may not make any loan
 of funds borrowed under subparagraph (A) at an interest rate which exceeds
 by more than 1 3/4  percent per annum the interest rate paid to the State
 mortgage finance agency on the obligations issued to obtain the funds
 so borrowed.
 `(4) CREDIT CARDS- Subject to regulations of the Director, a Federal savings
 association may issue credit cards, extend credit in connection therewith,
 and otherwise engage in or participate in credit card operations.
 `(5) MUTUAL CAPITAL CERTIFICATES- In accordance with regulations issued by
 the Director, mutual capital certificates may be issued and sold directly
 to subscribers or through underwriters. Such certificates may be included in
 calculating capital for the purpose of subsection (t) to the extent permitted
 by the Director. The issuance of certificates under this paragraph does not
 constitute a change of control or ownership under this Act or any other law
 unless there is in fact a change in control or reorganization. Regulations
 relating to the issuance and sale of mutual capital certificates shall
 provide that such certificates--
 `(A) are subordinate to all savings accounts, savings certificates, and
 debt obligations;
 `(B) constitute a claim in liquidation on the general reserves, surplus,
 and undivided profits of the Federal savings association remaining after
 the payment in full of all savings accounts, savings certificates, and
 debt obligations;
 `(C) are entitled to the payment of dividends; and
 `(D) may have a fixed or variable dividend rate.
 `(c) LOANS AND INVESTMENTS- To the extent specified in regulations of the
 Director, a Federal savings association may invest in, sell, or otherwise
 deal in the following loans and other investments:
 `(1) LOANS OR INVESTMENTS WITHOUT PERCENTAGE OF ASSETS LIMITATION- Without
 limitation as a percentage of assets, the following are permitted:
 `(A) ACCOUNT LOANS- Loans on the security of its savings accounts and loans
 specifically related to transaction accounts.
 `(B) RESIDENTIAL REAL PROPERTY LOANS- Loans on the security of liens upon
 residential real property.
 `(C) UNITED STATES GOVERNMENT SECURITIES- Investments in obligations of,
 or fully guaranteed as to principal and interest by, the United States.
 `(D) FEDERAL HOME LOAN BANK AND FEDERAL NATIONAL MORTGAGE ASSOCIATION
 SECURITIES- Investments in the stock or bonds of a Federal home loan bank
 or in the stock of the Federal National Mortgage Association.
 `(E) FEDERAL HOME LOAN MORTGAGE CORPORATION INSTRUMENTS- Investments in
 mortgages, obligations, or other securities which are or have been sold by
 the Federal Home Loan Mortgage Corporation pursuant to section 305 or 306
 of the Federal Home Loan Mortgage Corporation Act.
 `(F) OTHER GOVERNMENT SECURITIES- Investments in obligations, participations,
 securities, or other instruments issued by, or fully guaranteed as to
 principal and interest by, the Federal National Mortgage Association,
 the Student Loan Marketing Association, the Government National Mortgage
 Association, or any agency of the United States. A savings association may
 issue and sell securities which are guaranteed pursuant to section 306(g)
 of the National Housing Act.
 `(G) DEPOSITS- Investments in accounts of any insured depository institution,
 as defined in section 3 of the Federal Deposit Insurance Act.
 `(H) STATE SECURITIES- Investments in obligations issued by any State
 or political subdivision thereof (including any agency, corporation, or
 instrumentality of a State or political subdivision). A Federal savings
 association may not invest more than 10 percent of its capital in obligations
 of any one issuer, exclusive of investments in general obligations of
 any issuer.
 `(I) PURCHASE OF INSURED LOANS- Purchase of loans secured by liens on
 improved real estate which are insured or guaranteed under the National
 Housing Act, the Servicemen's Readjustment Act of 1944, or chapter 37 of
 title 38, United States Code.
 `(J) HOME IMPROVEMENT AND MANUFACTURED HOME LOANS- Loans made to repair,
 equip, alter, or improve any residential real property, and loans made for
 manufactured home financing.
 `(K) INSURED LOANS TO FINANCE THE PURCHASE OF FEE SIMPLE- Loans insured
 under section 240 of the National Housing Act.
 `(L) LOANS TO FINANCIAL INSTITUTIONS, BROKERS, AND DEALERS- Loans to--
 `(i) financial institutions with respect to which the United States or
 an agency or instrumentality thereof has any function of examination or
 supervision, or
 `(ii) any broker or dealer registered with the Securities and Exchange
 Commission,
which are secured by loans, obligations, or investments in which the Federal
savings association has the statutory authority to invest directly.
 `(M) LIQUIDITY INVESTMENTS- Investments which, when made, are of a type that
 may be used to satisfy any liquidity requirement imposed by the Director
 pursuant to section 6.
 `(N) INVESTMENT IN THE NATIONAL HOUSING PARTNERSHIP CORPORATION, PARTNERSHIPS,
 AND JOINT VENTURES- Investments in 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 investments in any partnership, limited
 partnership, or joint venture formed pursuant to section 907(a) or 907(c)
 of such Act.
 `(O) CERTAIN HUD INSURED OR GUARANTEED INVESTMENTS- Loans that are secured
 by mortgages--
 `(i) insured under title X of the National Housing Act, or
 `(ii) guaranteed under title IV of the Housing and Urban Development Act of
 1968, under part B of the National Urban Policy and New Community Development
 Act of 1970, or under section 802 of the Housing and Community Development
 Act of 1974.
 `(P) STATE HOUSING CORPORATION INVESTMENTS- Obligations of and loans to
 any State housing corporation, if--
 `(i) such obligations or loans are secured directly, or indirectly through
 an agent or fiduciary, by a first lien on improved real estate which is
 insured under the provisions of the National Housing Act, and
 `(ii) in the event of default, the holder of the obligations or loans has
 the right directly, or indirectly through an agent or fiduciary, to cause
 to be subject to the satisfaction of such obligations or loans the real
 estate described in the first lien or the insurance proceeds under the
 National Housing Act.
 `(Q) INVESTMENT COMPANIES- A Federal savings association may invest in,
 redeem, or hold shares or certificates issued by any open-end management
 investment company which--
 `(i) is registered with the Securities and Exchange Commission under the
 Investment Company Act of 1940, and
 `(ii) the portfolio of which is restricted by such management company's
 investment policy (changeable only if authorized by shareholder vote) solely
 to investments that a Federal savings association by law or regulation may,
 without limitation as to percentage of assets, invest in, sell, redeem,
 hold, or otherwise deal in.
 `(R) MORTGAGE-BACKED SECURITIES- Investments in securities that--
 `(i) are offered and sold pursuant to section 4(5) of the Securities Act
 of 1933; or
 `(ii) are mortgage related securities (as defined in section 3(a)(41)
 of the Securities Exchange Act of 1934),
subject to such regulations as the Director may prescribe, including
regulations prescribing minimum size of the issue (at the time of initial
distribution) or minimum aggregate sales price, or both.
 `(2) LOANS OR INVESTMENTS LIMITED TO A PERCENTAGE OF ASSETS OR CAPITAL-
 The following loans or investments are permitted, but only to the extent
 specified:
 `(A) COMMERCIAL AND OTHER LOANS- Secured or unsecured loans for commercial,
 corporate, business, or agricultural purposes. The aggregate amount of
 loans under this paragraph shall not exceed 10 percent of the assets of
 the Federal savings association.
 `(B) Nonresidential real property loans-
 `(i) IN GENERAL- Loans on the security of liens upon nonresidential real
 property. Except as provided in clause (ii), the aggregate amount of such
 loans shall not exceed 400 percent of the Federal savings association's
 capital, as determined under subsection (t).
 `(ii) EXCEPTION- The Director may permit a savings association to exceed
 the limitation set forth in clause (i) if the Director determines that the
 increased authority--
 `(I) poses no significant risk to the safe and sound operation of the
 association, and
 `(II) is consistent with prudent operating practices.
 `(iii) MONITORING- If the Director permits any increased authority pursuant
 to clause (ii), the Director shall closely monitor the Federal savings
 association's condition and lending activities to ensure that the savings
 association carries out all authority under this paragraph in a safe and
 sound manner and complies with this subparagraph and all relevant laws
 and regulations.
 `(C) INVESTMENTS IN PERSONAL PROPERTY- Investments in tangible personal
 property, including, vehicles, manufactured homes, machinery, equipment,
 or furniture, for rental or sale. Investments under this subparagraph may
 not exceed 10 percent of the assets of the Federal savings association.
 `(D) CONSUMER LOANS AND CERTAIN SECURITIES- A Federal savings association
 may make loans for personal, family, or household purposes, including loans
 reasonably incident to providing such credit, and may invest in, sell, or
 hold commercial paper and corporate debt securities, as defined and approved
 by the Director. Loans and other investments under this subparagraph may
 not exceed 30 percent of the assets of the Federal savings association.
 `(3) LOANS OR INVESTMENTS LIMITED TO 5 PERCENT OF ASSETS- The following
 loans or investments are permitted, but not to exceed 5 percent of assets
 of a Federal savings association for each subparagraph:
 `(A) EDUCATION LOANS- Loans made for the payment of educational expenses.
 `(B) COMMUNITY DEVELOPMENT INVESTMENTS- Investments in real property and
 obligations secured by liens on real property located within a geographic
 area or neighborhood receiving concentrated development assistance by a local
 government under title I of the Housing and Community Development Act of
 1974. No investment under this subparagraph in such real property may exceed
 an aggregate of 2 percent of the assets of the Federal savings association.
 `(C) NONCONFORMING LOANS- Loans upon the security of or respecting real
 property or interests therein used for primarily residential or farm purposes
 that do not comply with the limitations of this subsection.
 `(D) CONSTRUCTION LOANS WITHOUT SECURITY- Loans--
 `(i) the principal purpose of which is to provide financing with respect
 to what is or is expected to become primarily residential real estate; and
 `(ii) with respect to which the association--
 `(I) relies substantially on the borrower's general credit standing and
 projected future income for repayment, without other security; or
 `(II) relies on other assurances for repayment, including a guarantee or
 similar obligation of a third party.
The aggregate amount of such investments shall not exceed the greater of
the Federal savings association's capital or 5 percent of its assets.
 `(4) OTHER LOANS AND INVESTMENTS- The following additional loans and other
 investments to the extent authorized below:
 `(A) BUSINESS DEVELOPMENT CREDIT CORPORATIONS- A Federal savings association
 that is in compliance with the capital standards prescribed under subsection
 (t) may invest in, lend to, or to commit itself to lend to, any business
 development credit corporation incorporated in the State in which the home
 office of the association is located in the same manner and to the same
 extent as savings associations chartered by such State are authorized. The
 aggregate amount of such investments, loans, and commitments of any such
 Federal savings association shall not exceed one-half of 1 percent of the
 association's total outstanding loans or $250,000, whichever is less.
 `(B) SERVICE CORPORATIONS- Investments in the capital stock, obligations,
 or other securities of any corporation organized under the laws of the
 State in which the Federal savings association's home office is located,
 if such corporation's entire capital stock is available for purchase only
 by savings associations of such State and by Federal associations having
 their home offices in such State. No Federal savings association may
 make any investment under this subparagraph if the association's aggregate
 outstanding investment under this subparagraph would exceed 3 percent of the
 association's assets. Not less than one-half of the investment permitted under
 this subparagraph which exceeds 1 percent of the association's assets shall be
 used primarily for community, inner-city, and community development purposes.
 `(C) FOREIGN ASSISTANCE INVESTMENTS- Investments in housing project
 loans having the benefit of any guaranty under section 221 of the Foreign
 Assistance Act of 1961 or loans having the benefit of any guarantee under
 section 224 of such Act, or any commitment or agreement with respect to such
 loans made pursuant to either of such sections and in the share capital and
 capital reserve of the Inter-American Savings and Loan Bank. This authority
 extends to the acquisition, holding, and disposition of loans guaranteed
 under section 221 or 222 of such Act. Investments under this subparagraph
 shall not exceed 1 percent of the Federal savings association's assets.
 `(D) SMALL BUSINESS INVESTMENT COMPANIES- A Federal savings association
 may invest in stock, obligations, or other securities of any small business
 investment company formed pursuant to section 301(d) of the Small Business
 Investment Act of 1958 for the purpose of aiding members of a Federal
 home loan bank. A Federal savings association may not make any investment
 under this subparagraph if its aggregate outstanding investment under this
 subparagraph would exceed 1 percent of the assets of such savings association.
 `(5) DEFINITIONS- As used in this subsection--
 `(A) RESIDENTIAL PROPERTY- The terms `residential real property' or
 `residential real estate' mean leaseholds, homes (including condominiums
 and cooperatives, except that in connection with loans on individual
 cooperative units, such loans shall be adequately secured as defined by
 the Director) and, combinations of homes or dwelling units and business
 property, involving only minor or incidental business use, or property to
 be improved by construction of such structures.
 `(B) LOANS- The term `loans' includes obligations and extensions or advances
 of credit; and any reference to a loan or investment includes an interest
 in such a loan or investment.
 `(d) Regulatory Authority-
 `(1) In general-
 `(A) ENFORCEMENT- The Director shall have power to enforce this section,
 section 8 of the Federal Deposit Insurance Act, and regulations prescribed
 hereunder. In enforcing any provision of this section, regulations prescribed
 under this section, or any other law or regulation, or in any other action,
 suit, or proceeding to which the Director is a party or in which the
 Director is interested, and in the administration of conservatorships and
 receiverships, the Director may act in the Director's own name and through
 the Director's own attorneys. Except as otherwise provided, the Director
 shall be subject to suit (other than suits on claims for money damages) by
 any Federal savings association or director or officer thereof with respect
 to any matter under this section or any other applicable law, or regulation
 thereunder, in the United States district court for the judicial district
 in which the savings association's home office is located, or in the United
 States District Court for the District of Columbia, and the Director may
 be served with process in the manner prescribed by the Federal Rules of
 Civil Procedure.
 `(B) ANCILLARY PROVISIONS- (i) In making examinations of savings associations,
 examiners appointed by the Director shall have power to make such examinations
 of the affairs of all affiliates of such savings associations as shall be
 necessary to disclose fully the relations between such savings associations
 and their affiliates and the effect of such relations upon such savings
 associations. For purposes of this subsection, the term `affiliate' has
 the same meaning as in section 2(b) of the Banking Act of 1933, except
 that the term `member bank' in section 2(b) shall be deemed to refer to a
 savings association.
 `(ii) In the course of any examination of any savings association, upon
 request by the Director, prompt and complete access shall be given to all
 savings association officers, directors, employees, and agents, and to all
 relevant books, records, or documents of any type.
 `(iii) Upon request made in the course of supervision or oversight of
 any savings association, for the purpose of acting on any application or
 determining the condition of any savings association, including whether
 operations are being conducted safely, soundly, or in compliance with
 charters, laws, regulations, directives, written agreements, or conditions
 imposed in writing in connection with the granting of an application or
 other request, the Director shall be given prompt and complete access to
 all savings association officers, directors, employees, and agents, and to
 all relevant books, records, or documents of any type.
 `(iv) If prompt and complete access upon request is not given as required in
 this subsection, the Director may 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 institution is located, or in which
 the person denying such access resides or carries on business, for an order
 requiring that such information be promptly provided.
 `(v) In connection with examinations of savings associations and affiliates
 thereof, the Director may--
 `(I) administer oaths and affirmations and examine and to take and preserve
 testimony under oath as to any matter in respect of the affairs or ownership
 of any such savings association or affiliate, and
 `(II) issue subpenas and, for the enforcement thereof, 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 savings association or
 affiliate 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.
 `(vi) In any proceeding under this section, the Director may administer oaths
 and affirmations, take depositions, and issue subpenas. The Director may
 prescribe regulations with respect to any such proceedings. The attendance of
 witnesses and the production of documents provided for in this subsection
 may be required from any place in any State or in any territory at any
 designated place where such proceeding is being conducted.
 `(vii) Any party to a proceeding under this section may apply to the
 United States District Court for the District of Columbia, or the United
 States district court for the judicial district (or the United States
 court in any territory) in which such proceeding is being conducted, or
 where the witness resides or carries on business, for enforcement of any
 subpena issued pursuant to this subsection or section 10(c) of the Federal
 Deposit Insurance Act, and such courts shall have jurisdiction and power
 to order and require compliance therewith. Witnesses subpenaed under this
 section shall be paid the same fees and mileage that are paid witnesses
 in the district courts of the United States. All expenses of the Director
 in connection with this section shall be considered as nonadministrative
 expenses. Any court having jurisdiction of any proceeding instituted under
 this section by a savings association, or a director or officer thereof,
 may allow to any such party reasonable expenses and attorneys' fees. Such
 expenses and fees shall be paid by the savings association.
 `(2) Conservatorships and receiverships-
 `(A) GROUNDS FOR APPOINTMENT FOR FEDERAL SAVINGS ASSOCIATIONS- A conservator
 or receiver may be appointed for a Federal savings association if one or
 more of the following conditions exist:
 `(i) insolvency in that the assets of the association are less than its
 obligations to its creditors and others, including its members;
 `(ii) substantial dissipation of assets or earnings due to any violation
 or violations of law or regulations, or to any unsafe or unsound practice
 or practices;
 `(iii) an unsafe or unsound condition to transact business, including having
 substantially insufficient capital or otherwise;
 `(iv) willful violation of a cease-and-desist order which has become final;
 `(v) concealment of books, papers, records, or assets of the savings
 association or refusal to submit books, papers, records, or affairs of
 the association for inspection to any examiner or to any lawful agent of
 the Director;
 `(vi) the association is not likely to be able to meet the demands of its
 depositors or pay its obligations in the normal course of business;
 `(vii)(I) the association has incurred or is likely to incur losses that
 will deplete all or substantially all of its capital, and (II) there is no
 reasonable prospect for the replenishment of the capital of the association
 without Federal assistance; or
 `(viii) there is a violation or violations of laws or regulations, or an
 unsafe or unsound practice or condition which is likely to cause insolvency
 or substantial dissipation of assets or earnings, or is likely to weaken the
 condition of the association or otherwise seriously prejudice the interests
 of its depositors.
 `(B) ADDITIONAL GROUNDS FOR APPOINTMENT OF FEDERAL ASSOCIATIONS- In addition
 to the foregoing provisions, the Director may, without any requirement of
 notice, hearing, or other action, appoint a conservator or receiver for a
 Federal savings association if--
 `(i) the association, by resolution of its board of directors or of its
 members, consents to such appointment, or
 `(ii) the association is removed from membership in any Federal home loan
 bank, or its status as an institution the accounts of which are insured by
 the Corporation is terminated.
 `(C) GROUNDS FOR APPOINTMENT FOR STATE ASSOCIATIONS- Notwithstanding any other
 provision of law, the Director shall have power and jurisdiction to appoint
 a conservator or receiver for an insured State savings association, if the
 Director determines that any of the following grounds for the appointment
 of a conservator or receiver exists:
 `(i) insolvency in that the assets of the savings association are less than
 its obligations to its creditors and others, including its members;
 `(ii) substantial dissipation of assets or earnings due to any violation
 or violations of law or regulations, or to any unsafe or unsound practice
 or practices;
 `(iii) an unsafe or unsound condition to transact business, including having
 substantially insufficient capital or otherwise;
 `(iv) the association is not likely to be able to meet the demands of its
 depositors or pay its obligations in the normal course of business;
 `(v)(I) the savings association has incurred or is likely to incur losses
 that will deplete all or substantially all of its capital, and (II) there
 is no reasonable prospect for the savings association's capital to be
 replenished without Federal assistance; or
 `(vi) there is a violation or violations of laws or regulations, or an
 unsafe or unsound practice or condition which is likely to cause insolvency
 or substantial dissipation of assets or earnings, or is likely to weaken the
 condition of the association or otherwise seriously prejudice the interests
 of its depositors.
 `(D) APPROVAL OF STATE OFFICIAL- (i) The authority conferred by subparagraph
 (C) shall not be exercised without the written approval of the State official
 having jurisdiction over the insured State savings association that one or
 more of the grounds specified for such exercise exist.
 `(ii) If such approval has not been received within 30 days of receipt of
 notice to the State that the Director has determined such grounds exist,
 and the Director has responded in writing to the State's written reasons,
 if any, for withholding approval, then the Director may proceed without
 State approval.
 `(E) POWER OF APPOINTMENT; JUDICIAL REVIEW- The Director shall have exclusive
 power and jurisdiction to appoint a conservator or receiver for a Federal
 savings association. If, in the opinion of the Director, a ground for the
 appointment of a conservator or receiver for a savings association exists, the
 Director is authorized to appoint ex parte and without notice a conservator
 or receiver for the savings association. In the event of such appointment,
 the association may, within 30 days thereafter, bring an action in the United
 States district court for the judicial district in which the home office of
 such association is located, or in the United States District Court for the
 District of Columbia, for an order requiring the Director to remove such
 conservator or receiver, and the court shall upon the merits dismiss such
 action or direct the Director to remove such conservator or receiver. Upon
 the commencement of such an action, the court having jurisdiction of any
 other action or proceeding authorized under this subsection to which the
 association is a party shall stay such action or proceeding during the
 pendency of the action for removal of the conservator or receiver.
 `(F) REPLACEMENT- The Director may, without any prior notice, hearing,
 or other action, replace a conservator with another conservator or with
 a receiver, but such replacement shall not affect any right which the
 association may have to obtain judicial review of the original appointment,
 except that any removal under this subparagraph shall be removal of the
 conservator or receiver in office at the time of such removal.
 `(G) COURT ACTION- Except as otherwise provided in this subsection, no
 court may take any action for or toward the removal of any conservator or
 receiver, or, except at the instance of the Director, restrain or affect
 the exercise of powers or functions of a conservator or receiver.
 `(H) Powers-
 `(i) IN GENERAL- A conservator shall have all the powers of the members,
 the stockholders, the directors, and the officers of the association and
 shall be authorized to operate the association in its own name or to conserve
 its assets in the manner and to the extent authorized by the Director.
 `(ii) FDIC OR RTC AS CONSERVATOR OR RECEIVER- Except as provided in section
 21A of the Federal Home Loan Bank Act, the Director, at the Director's
 discretion, may appoint the Federal Deposit Insurance Corporation or the
 Resolution Trust Corporation, as appropriate, as conservator for a savings
 association. The Director shall appoint only the Federal Deposit Insurance
 Corporation or the Resolution Trust Corporation, as appropriate, as receiver
 for a savings association for the purpose of liquidation or winding up
 the affairs of such savings association. The conservator or receiver so
 appointed shall, as such, have power to buy at its own sale. The Federal
 Deposit Insurance Corporation, as such conservator or receiver, shall have
 all the powers of a conservator or receiver, as appropriate, granted under
 the Federal Deposit Insurance Act, and (when not inconsistent therewith)
 any other rights, powers, and privileges possessed by conservators or
 receivers, as appropriate, of savings associations under this Act and any
 other provisions of law.
 `(I) DISCLOSURE REQUIREMENT FOR THOSE ACTING ON BEHALF OF CONSERVATOR- A
 conservator shall require that any independent contractor, consultant, or
 counsel employed by the conservator in connection with the conservatorship of
 a savings association pursuant to this section shall fully disclose to all
 parties with which such contractor, consultant, or counsel is negotiating,
 any limitation on the authority of such contractor, consultant, or counsel
 to make legally binding representations on behalf of the conservator.
 `(3) Regulations-
 `(A) IN GENERAL- The Director may prescribe regulations for the
 reorganization, consolidation, liquidation, and dissolution of savings
 associations, for the merger of insured savings associations with insured
 savings associations, for savings associations in conservatorship and
 receivership, and for the conduct of conservatorships and receiverships. The
 Director may, by regulation or otherwise, provide for the exercise of
 functions by members, stockholders, directors, or officers of a savings
 association during conservatorship and receivership.
 `(B) FDIC OR RTC AS CONSERVATOR OR RECEIVER- In any case where the Federal
 Deposit Insurance Corporation or the Resolution Trust Corporation is the
 conservator or receiver, any regulations prescribed by the Director shall be
 consistent with any regulations prescribed by the Federal Deposit Insurance
 Corporation pursuant to the Federal Deposit Insurance Act.
 `(4) REFUSAL TO COMPLY WITH DEMAND- Whenever a conservator or receiver
 appointed by the Director demands possession of the property, business,
 and assets of any savings association, or of any part thereof, the refusal
 by any director, officer, employee, or agent of such association to comply
 with the demand shall be punishable by a fine of not more than $5,000 or
 imprisonment for not more than one year, or both.
 `(5) DEFINITIONS- As used in this subsection, the term `savings association'
 includes any savings association or former savings association that retains
 deposits insured by the Corporation, notwithstanding termination of its
 status as an institution insured by the Corporation.
 `(6) COMPLIANCE WITH MONETARY TRANSACTION RECORDKEEPING AND REPORT
 REQUIREMENTS-
 `(A) COMPLIANCE PROCEDURES REQUIRED- The Director shall prescribe regulations
 requiring savings associations to establish and maintain procedures reasonably
 designed to assure and monitor the compliance of such associations with the
 requirements of subchapter II of chapter 53 of title 31, United States Code.
 `(B) EXAMINATIONS OF SAVINGS ASSOCIATIONS TO INCLUDE REVIEW OF COMPLIANCE
 PROCEDURES-
 `(i) IN GENERAL- Each examination of a savings association by the Director
 shall include a review of the procedures required to be established and
 maintained under subparagraph (A).
 `(ii) EXAM REPORT REQUIREMENT- The report of examination shall describe
 any problem with the procedures maintained by the association.
 `(C) ORDER TO COMPLY WITH REQUIREMENTS- If the Director determines that a
 savings association--
 `(i) has failed to establish and maintain the procedures described in
 subparagraph (A); or
 `(ii) has failed to correct any problem with the procedures maintained by such
 association which was previously reported to the association by the Director,
the Director shall issue an order under section 8 of the Federal Deposit
Insurance Act requiring such association to cease and desist from its
violation of this paragraph or regulations prescribed under this paragraph.
 `(e) CHARACTER AND RESPONSIBILITY- A charter may be granted only--
 `(1) to persons of good character and responsibility,
 `(2) if in the judgment of the Director a necessity exists for such an
 institution in the community to be served,
 `(3) if there is a reasonable probability of its usefulness and success, and
 `(4) if the association can be established without undue injury to properly
 conducted existing local thrift and home financing institutions.
 `(f) FEDERAL HOME LOAN BANK MEMBERSHIP- Each Federal savings association,
 upon receiving its charter, shall become automatically a member of the
 Federal home loan bank of the district in which it is located, or if
 convenience requires and the Director approves, shall become a member of
 a Federal home loan bank of an adjoining district. Such associations shall
 qualify for such membership in the manner provided in the Federal Home Loan
 Bank Act with respect to other members.
 `(g) PREFERRED SHARES- [Repealed.]
 `(h) DISCRIMINATORY STATE AND LOCAL TAXATION PROHIBITED- No State, county,
 municipal, or local taxing authority may impose any tax on Federal savings
 associations or their franchise, capital, reserves, surplus, loans, or
 income greater than that imposed by such authority on other similar local
 mutual or cooperative thrift and home financing institutions.
 `(i) Conversions-
 (1) IN GENERAL- Any savings association which is, or is eligible to become,
 a member of a Federal home loan bank may convert into a Federal savings
 association (and in so doing may change directly from the mutual form to the
 stock form, or from the stock form to the mutual form). Such conversion shall
 be subject to such regulations as the Director shall prescribe. Thereafter
 such Federal savings association shall be entitled to all the benefits of
 this section and shall be subject to examination and regulation to the same
 extent as other associations incorporated pursuant to this Act.
 `(2) AUTHORITY OF DIRECTOR- (A) No savings association may convert from
 the mutual to the stock form, or from the stock form to the mutual form,
 except in accordance with the regulations of the Director.
 `(B) Any aggrieved person may obtain review of a final action of the Director
 which approves or disapproves a plan of conversion pursuant to this subsection
 only by complying with the provisions of section 10(j) of this Act within
 the time limit and in the manner therein prescribed, which provisions shall
 apply in all respects as if such final action were an order the review of
 which is therein provided for, except that such time limit shall commence
 upon publication of notice of such final action in the Federal Register or
 upon the giving of such general notice of such final action as is required
 by or approved under regulations of the Director, whichever is later.
 `(C) Any Federal savings association may change its designation from a
 Federal savings association to a Federal savings bank, or the reverse.
 `(3) CONVERSION TO STATE ASSOCIATION- (A) Any Federal savings association
 may convert itself into a savings association or savings bank organized
 pursuant to the laws of the State in which the principal office of such
 Federal savings association is located if--
 `(i) the State permits the conversion of any savings association or savings
 bank of such State into a Federal savings association;
 `(ii) such conversion of a Federal savings association into such a State
 savings association is determined--
 `(I) upon the vote in favor of such conversion cast in person or by proxy
 at a special meeting of members or stockholders called to consider such
 action, specified by the law of the State in which the home office of
 the Federal savings association is located, as required by such law for
 a State-chartered institution to convert itself into a Federal savings
 association, but in no event upon a vote of less than 51 percent of all
 the votes cast at such meeting, and
 `(II) upon compliance with other requirements reciprocally equivalent to
 the requirements of such State law for the conversion of a State-chartered
 institution into a Federal savings association;
 `(iii) notice of the meeting to vote on conversion shall be given as herein
 provided and no other notice thereof shall be necessary; the notice shall
 expressly state that such meeting is called to vote thereon, as well as the
 time and place thereof; and such notice shall be mailed, postage prepaid,
 at least 30 and not more than 60 days prior to the date of the meeting,
 to the Director and to each member or stockholder of record of the Federal
 savings association at the member's or stockholder's last address as shown
 on the books of the Federal savings association;
 `(iv) when a mutual savings association is dissolved after conversion,
 the members or shareholders of the savings association will share on a
 mutual basis in the assets of the association in exact proportion to their
 relative share or account credits;
 `(v) when a stock savings association is dissolved after conversion,
 the stockholders will share on an equitable basis in the assets of the
 association; and
 `(vi) such conversion shall be effective upon the date that all the provisions
 of this Act shall have been fully complied with and upon the issuance of
 a new charter by the State wherein the savings association is located.
 `(B)(i) The act of conversion constitutes consent by the institution to be
 bound by all the requirements that the Director may impose under this Act.
 `(ii) The savings association shall upon conversion and thereafter be
 authorized to issue securities in any form currently approved at the time
 of issue by the Director for issuance by similar savings associations in
 such State.
 `(iii) If the insurance of accounts is terminated in connection with such
 conversion, the notice and other action shall be taken as provided by law
 and regulations for the termination of insurance of accounts.
 `(4) SAVINGS BANK ACTIVITIES- (A) To the extent authorized by the Director,
 but subject to section 18(m)(3) of the Federal Deposit Insurance Act--
 `(i) any Federal savings bank chartered as such prior to October 15, 1982,
 may continue to make any investment or engage in any activity not otherwise
 authorized under this section, to the degree it was permitted to do so as
 a Federal savings bank prior to October 15, 1982; and
 `(ii) any Federal savings bank organized prior to October 15, 1982, formerly
 organized as a mutual savings bank under State law may continue to make any
 investment or engage in any activity not otherwise authorized under this
 section, to the degree it was authorized to do so as a mutual savings bank
 under State law.
 `(B) The authority conferred by this paragraph may be utilized by any
 Federal savings association that acquires, by merger or consolidation,
 a Federal savings bank enjoying grandfather rights hereunder.
 `(j) SUBSCRIPTION FOR SHARES- [Repealed.]
 `(k) DEPOSITORY OF PUBLIC MONEY- When designated for that purpose by the
 Secretary of the Treasury, a savings association the deposits of which are
 insured by the Corporation shall be a depository of public money and may
 be employed as fiscal agent of the Government under such regulations as
 may be prescribed by the Secretary and shall perform all such reasonable
 duties as fiscal agent of the Government as may be required of it. A savings
 association the deposits of which are insured by the Corporation may act as
 agent for any other instrumentality of the United States when designated for
 that purpose by such instrumentality, including services in connection with
 the collection of taxes and other obligations owed the United States, and
 the Secretary of the Treasury may deposit public money in any such savings
 association, and shall prescribe such regulations as may be necessary to
 carry out the purposes of this subsection.
 `(l) RETIREMENT ACCOUNTS- A Federal savings association is authorized
 to act as trustee of any trust created or organized in the United States
 and forming part of a stock bonus, pension, or profit-sharing plan which
 qualifies or qualified for specific tax treatment under section 401(d)
 of the Internal Revenue Code of 1986 and to act as trustee or custodian
 of an individual retirement account within the meaning of section 408
 of such Code if the funds of such trust or account are invested only in
 savings accounts or deposits in such Federal savings association or in
 obligations or securities issued by such Federal savings association. All
 funds held in such fiduciary capacity by any Federal savings association
 may be commingled for appropriate purposes of investment, but individual
 records shall be kept by the fiduciary for each participant and shall show
 in proper detail all transactions engaged in under this paragraph.
 `(m) Branching-
 `(1) In general-
 `(A) No savings association incorporated under the laws of the District of
 Columbia or organized in the District or doing business in the District
 shall establish any branch or move its principal office or any branch
 without the Director's prior written approval.
 `(B) No savings association shall establish any branch in the District of
 Columbia or move its principal office or any branch in the District without
 the Director's prior written approval.
 `(2) DEFINITION- For purposes of this subsection the term `branch' means
 any office, place of business, or facility, other than the principal office
 as defined by the Director, of a savings association at which accounts
 are opened or payments are received or withdrawals are made, or any other
 office, place of business, or facility of a savings association defined by
 the Director as a branch within the meaning of such sentence.
 `(n) Trusts-
 `(1) PERMITS- The Director may grant by special permit to a Federal savings
 association applying therefor the right to act as trustee, executor,
 administrator, guardian, or in any other fiduciary capacity in which
 State banks, trust companies, or other corporations which compete with
 Federal savings associations are permitted to act under the laws of the
 State in which the Federal savings association is located. Subject to the
 regulations of the Director, service corporations may invest in State or
 federally chartered corporations which are located in the State in which
 the home office of the Federal savings association is located and which
 are engaged in trust activities.
 `(2) SEGREGATION OF ASSETS- A Federal savings association exercising
 any or all of the powers enumerated in this section shall segregate all
 assets held in any fiduciary capacity from the general assets of the
 association and shall keep a separate set of books and records showing in
 proper detail all transactions engaged in under this subsection. The State
 banking authority involved may have access to reports of examination made
 by the Director insofar as such reports relate to the trust department
 of such association but nothing in this subsection shall be construed as
 authorizing such State banking authority to examine the books, records,
 and assets of such associations.
 `(3) PROHIBITIONS- No Federal savings association shall receive in its
 trust department deposits of current funds subject to check or the deposit
 of checks, drafts, bills of exchange, or other items for collection or
 exchange purposes. Funds deposited or held in trust by the association
 awaiting investment shall be carried in a separate account and shall not be
 used by the association in the conduct of its business unless it shall first
 set aside in the trust department United States bonds or other securities
 approved by the Director.
 `(4) SEPARATE LIEN- In the event of the failure of a Federal savings
 association, the owners of the funds held in trust for investment shall
 have a lien on the bonds or other securities so set apart in addition to
 their claim against the estate of the association.
 `(5) DEPOSITS- Whenever the laws of a State require corporations acting in
 a fiduciary capacity to deposit securities with the State authorities for
 the protection of private or court trusts, Federal savings associations
 so acting shall be required to make similar deposits. Securities so
 deposited shall be held for the protection of private or court trusts,
 as provided by the State law. Federal savings associations in such cases
 shall not be required to execute the bond usually required of individuals
 if State corporations under similar circumstances are exempt from this
 requirement. Federal savings associations shall have power to execute such
 bond when so required by the laws of the State involved.
 `(6) OATHS AND AFFIDAVITS- In any case in which the laws of a State require
 that a corporation acting as trustee, executor, administrator, or in any
 capacity specified in this section, shall take an oath or make an affidavit,
 the president, vice president, cashier, or trust officer of such association
 may take the necessary oath or execute the necessary affidavit.
 `(7) CERTAIN LOANS PROHIBITED- It shall be unlawful for any Federal savings
 association to lend any officer, director, or employee any funds held in
 trust under the powers conferred by this section. Any officer, director,
 or employee making such loan, or to whom such loan is made, may be fined
 not more than $50,000 or twice the amount of that person's gain from the
 loan, whichever is greater, or may be imprisoned not more than 5 years,
 or may be both fined and imprisoned, in the discretion of the court.
 `(8) FACTORS TO BE CONSIDERED- In reviewing applications for permission to
 exercise the powers enumerated in this section, the Director may consider--
 `(A) the amount of capital of the applying Federal savings association,
 `(B) whether or not such capital is sufficient under the circumstances of
 the case,
 `(C) the needs of the community to be served, and
 `(D) any other facts and circumstances that seem to it proper.
The Director may grant or refuse the application accordingly, except that
no permit shall be issued to any association having capital less than
the capital required by State law of State banks, trust companies, and
corporations exercising such powers.
 `(9) SURRENDER OF CHARTER- (A) Any Federal savings association may surrender
 its right to exercise the powers granted under this subsection, and have
 returned to it any securities which it may have deposited with the State
 authorities, by filing with the Director a certified copy of a resolution
 of its board of directors indicating its intention to surrender its right.
 `(B) Upon receipt of such resolution, the Director, if satisfied that such
 Federal savings association has been relieved in accordance with State
 law of all duties as trustee, executor, administrator, guardian or other
 fiduciary, may in the Director's discretion, issue to such association a
 certificate that such association is no longer authorized to exercise the
 powers granted by this subsection.
 `(C) Upon the issuance of such a certificate by the Director, such Federal
 savings association (i) shall no longer be subject to the provisions of this
 section or the regulations of the Director made pursuant thereto, (ii) shall
 be entitled to have returned to it any securities which it may have deposited
 with State authorities, and (iii) shall not exercise thereafter any of the
 powers granted by this section without first applying for and obtaining a
 new permit to exercise such powers pursuant to the provisions of this section.
 `(D) The Director may prescribe regulations necessary to enforce compliance
 with the provisions of this subsection.
 `(10) REVOCATION- (A) In addition to the authority conferred by other law, if,
 in the opinion of the Director, a Federal savings association is unlawfully or
 unsoundly exercising, or has unlawfully or unsoundly exercised, or has failed
 for a period of 5 consecutive years to exercise, the powers granted by this
 subsection or otherwise fails or has failed to comply with the requirements
 of this subsection, the Director may issue and serve upon the association a
 notice of intent to revoke the authority of the association to exercise the
 powers granted by this subsection. The notice shall contain a statement of
 the facts constituting the alleged unlawful or unsound exercise of powers,
 or failure to exercise powers, or failure to comply, and shall fix a time and
 place at which a hearing will be held to determine whether an order revoking
 authority to exercise such powers should issue against the association.
 `(B) Such hearing shall be conducted in accordance with the provisions of
 subsection (d)(1)(B), and subject to judicial review as therein provided,
 and shall be fixed for a date not earlier than 30 days and not later than
 60 days after service of such notice unless the Director sets an earlier
 or later date at the request of any Federal savings association so served.
 `(C) Unless the Federal savings association so served shall appear at the
 hearing by a duly authorized representative, it shall be deemed to have
 consented to the issuance of the revocation order. In the event of such
 consent, or if upon the record made at any such hearing, the Director
 shall find that any allegation specified in the notice of charges has
 been established, the Director may issue and serve upon the association an
 order prohibiting it from accepting any new or additional trust accounts and
 revoking authority to exercise any and all powers granted by this subsection,
 except that such order shall permit the association to continue to service
 all previously accepted trust accounts pending their expeditious divestiture
 or termination.
 `(D) A revocation order shall become effective not earlier than the expiration
 of 30 days after service of such order upon the association so served (except
 in the case of a revocation order issued upon consent, which shall become
 effective at the time specified therein), and shall remain effective and
 enforceable, except to such extent as it is stayed, modified, terminated,
 or set aside by action of the Director or a reviewing court.
 `(o) CONVERSION OF STATE SAVINGS BANKS- (1) Subject to the provisions of
 this subsection and under regulations of the Director, the Director may
 authorize the conversion of a State-chartered savings bank that is a Bank
 Insurance Fund member into a Federal savings bank, if such conversion
 is not in contravention of State law, and provide for the organization,
 incorporation, operation, examination, and regulation of such institution.
 `(2)(A) Any Federal savings bank chartered pursuant to this subsection
 shall continue to be a Bank Insurance Fund member until such time as it
 changes its status to a Savings Association Insurance Fund member.
 `(B) The Director shall notify the Corporation of any application under
 this Act for conversion to a Federal charter by an institution insured
 by the Corporation, shall consult with the Corporation before disposing
 of the application, and shall notify the Corporation of the Director's
 determination with respect to such application.
 `(C) Notwithstanding any other provision of law, if the Corporation determines
 that conversion into a Federal stock savings bank or the chartering of a
 Federal stock savings bank is necessary to prevent the default of a savings
 bank it insures or to reopen a savings bank in default that it insured,
 or if the Corporation determines, with the concurrence of the Director,
 that severe financial conditions exist that threaten the stability of
 a savings bank insured by the Corporation and that such a conversion or
 charter is likely to improve the financial condition of such savings bank,
 the Corporation shall provide the Director with a certificate of such
 determination, the reasons therefor in conformance with the requirements
 of this Act, and the bank shall be converted or chartered by the Director,
 pursuant to the regulations thereof, from the time the Corporation issues
 the certificate.
 `(D) A bank may be converted under subparagraph (C) only if the board of
 trustees of the bank--
 `(i) has specified in writing that the bank is in danger of closing or
 is closed, or that severe financial conditions exist that threaten the
 stability of the bank and a conversion is likely to improve the financial
 condition of the bank; and
 `(ii) has requested in writing that the Corporation use the authority of
 subparagraph (C).
 `(E)(i) Before making a determination under subparagraph (D), the Corporation
 shall consult the State bank supervisor of the State in which the bank in
 danger of closing is chartered. The State bank supervisor shall be given
 a reasonable opportunity, and in no event less than 48 hours, to object to
 the use of the provisions of subparagraph (D).
 `(ii) If the State supervisor objects during such period, the Corporation
 may use the authority of subparagraph (D) only by an affirmative vote of
 three-fourths of the Board of Directors. The Board of Directors shall provide
 the State supervisor, as soon as practicable, with a written certification
 of its determination.
 `(3) A Federal savings bank chartered under this subsection shall have the
 same authority with respect to investments, operations, and activities,
 and shall be subject to the same restrictions, including those applicable
 to branching and discrimination, as would apply to it if it were chartered
 as a Federal savings bank under any other provision of this Act.
 `(p) CONVERSIONS- (1) Notwithstanding any other provision of law, and
 consistent with the purposes of this Act, the Director may authorize (or in
 the case of a Federal savings association, require) the conversion of any
 mutual savings association or Federal mutual savings bank that is insured by
 the Corporation into a Federal stock savings association or Federal stock
 savings bank, or charter a Federal stock savings association or Federal
 stock savings bank to acquire the assets of, or merge with such a mutual
 institution under the regulations of the Director.
 `(2) Authorizations under this subsection may be made only--
 `(A) if the Director has determined that severe financial conditions exist
 which threaten the stability of an association and that such authorization
 is likely to improve the financial condition of the association,
 `(B) when the Corporation has contracted to provide assistance to such
 association under section 13 of the Federal Deposit Insurance Act, or
 `(C) to assist an institution in receivership.
 `(3) A Federal savings bank chartered under this subsection shall have
 the same authority with respect to investments, operations and activities,
 and shall be subject to the same restrictions, including those applicable
 to branching and discrimination, as would apply to it if it were chartered
 as a Federal savings bank under any other provision of this Act, and may
 engage in any investment, activity, or operation that the institution it
 acquired was engaged in if that institution was a Federal savings bank,
 or would have been authorized to engage in had that institution converted
 to a Federal charter.
 `(q) TYING ARRANGEMENTS- (1) A savings association may not in any manner
 extend credit, lease, or sell property of any kind, or furnish any service,
 or fix or vary the consideration for any of the foregoing, on the condition
 or requirement--
 `(A) that the customer shall obtain additional credit, property, or service
 from such savings association, or from any service corporation or affiliate
 of such association, other than a loan, discount, deposit, or trust service;
 `(B) that the customer provide additional credit, property, or service
 to such association, or to any service corporation or affiliate of such
 association, other than those related to and usually provided in connection
 with a similar loan, discount, deposit, or trust service; and
 `(C) that the customer shall not obtain some other credit, property, or
 service from a competitor of such association, or from a competitor of any
 service corporation or affiliate of such association, other than a condition
 or requirement that such association shall reasonably impose in connection
 with credit transactions to assure the soundness of credit.
 `(2)(A) Any person may sue for and have injunctive relief, in any court of
 the United States having jurisdiction over the parties, against threatened
 loss or damage by reason of a violation of paragraph (1), under the same
 conditions and principles as injunctive relief against threatened conduct
 that will cause loss or damage is granted by courts of equity and under
 the rules governing such proceedings.
 `(B) Upon the execution of proper bond against damages for an injunction
 improvidently granted and a showing that the danger of irreparable loss or
 damage is immediate, a preliminary injunction may issue.
 `(3) Any person injured by a violation of paragraph (1) may bring an action
 in any district court of the United States in which the defendant resides
 or is found or has an agent, without regard to the amount in controversy,
 or in any other court of competent jurisdiction, and shall be entitled
 to recover three times the amount of the damages sustained, and the cost
 of suit, including a reasonable attorney's fee. Any such action shall be
 brought within 4 years from the date of the occurrence of the violation.
 `(4) Nothing contained in this subsection affects in any manner the right of
 the United States or any other party to bring an action under any other law
 of the United States or of any State, including any right which may exist in
 addition to specific statutory authority, challenging the legality of any
 act or practice which may be proscribed by this subsection. No regulation
 or order issued by the Director under this subsection shall in any manner
 constitute a defense to such action.
 `(5) For purposes of this subsection, the term `loan' includes obligations
 and extensions or advances of credit.
 `(r) OUT-OF-STATE BRANCHES- (1) No Federal savings association may establish,
 retain, or operate a branch outside the State in which the Federal savings
 association has its home office, unless the association qualifies as a
 domestic building and loan association under section 7701(a)(19) of the
 Internal Revenue Code of 1986 or meets the asset composition test imposed by
 subparagraph (c) of that section on institutions seeking so to qualify. No
 out-of-State branch so established shall be retained or operated unless
 the total assets of the Federal savings association attributable to all
 branches of the Federal savings association in that State would qualify
 the branches as a whole, were they otherwise eligible, for treatment as a
 domestic building and loan association under section 7701(a)(19).
 `(2) The limitations of paragraph (1) shall not apply if--
 `(A) the branch results from a transaction authorized under section 13(k)
 of the Federal Deposit Insurance Act;
 `(B) the branch was authorized for the Federal savings association prior
 to October 15, 1982;
 `(C) the law of the State where the branch would be located would permit the
 branch to be established if the branch were a Federal savings association
 chartered by the State in which its home office is located; or
 `(D) the branch was operated lawfully as a branch under State law prior to
 the association's conversion to a Federal charter.
 `(3) The Director, for good cause shown, may allow Federal savings
 associations up to 2 years to comply with the requirements of this subsection.
 `(s) MINIMUM CAPITAL REQUIREMENTS-
 `(1) IN GENERAL- Consistent with the purposes of section 908 of the
 International Lending Supervision Act of 1983 and the capital requirements
 established pursuant to such section by the appropriate Federal banking
 agencies (as defined in section 903(1) of such Act), the Director shall
 require all savings associations to achieve and maintain adequate capital by--
 `(A) establishing minimum levels of capital for savings associations; and
 `(B) using such other methods as the Director determines to be appropriate.
 `(2) MINIMUM CAPITAL LEVELS MAY BE DETERMINED BY DIRECTOR CASE-BY-CASE-
 The Director may, consistent with subsection (t), establish the minimum
 level of capital for a savings association at such amount or at such
 ratio of capital-to-assets as the Director determines to be necessary or
 appropriate for such association in light of the particular circumstances
 of the association.
 `(3) UNSAFE OR UNSOUND PRACTICE- In the Director's discretion, the Director
 may treat the failure of any savings association to maintain capital at or
 above the minimum level required by the Director under this subsection or
 subsection (t) as an unsafe or unsound practice.
 `(4) DIRECTIVE TO INCREASE CAPITAL-
 `(A) PLAN MAY BE REQUIRED- In addition to any other action authorized by
 law, including paragraph (3), the Director may issue a directive requiring
 any savings association which fails to maintain capital at or above the
 minimum level required by the Director to submit and adhere to a plan for
 increasing capital which is acceptable to the Director.
 `(B) ENFORCEMENT OF PLAN- Any directive issued and plan approved under
 subparagraph (A) shall be enforceable under section 8 of the Federal Deposit
 Insurance Act to the same extent and in the same manner as an outstanding
 order which was issued under section 8 of the Federal Deposit Insurance
 Act and has become final.
 `(5) PLAN TAKEN INTO ACCOUNT IN OTHER PROCEEDINGS- The Director may--
 `(A) consider a savings association's progress in adhering to any plan
 required under paragraph (4) whenever such association or any affiliate of
 such association (including any company which controls such association)
 seeks the Director's approval for any proposal which would have the effect
 of diverting earnings, diminishing capital, or otherwise impeding such
 association's progress in meeting the minimum level of capital required by
 the Director; and
 `(B) disapprove any proposal referred to in subparagraph (A) if the Director
 determines that the proposal would adversely affect the ability of the
 association to comply with such plan.
 `(t) Capital Standards-
 `(1) In general-
 `(A) REQUIREMENT FOR STANDARDS TO BE PRESCRIBED- The Director shall, by
 regulation, prescribe and maintain uniformly applicable capital standards
 for savings associations. Those standards shall include--
 `(i) a leverage limit;
 `(ii) a tangible capital requirement; and
 `(iii) a risk-based capital requirement.
 `(B) COMPLIANCE- A savings association is not in compliance with capital
 standards for purposes of this subsection unless it complies with all
 capital standards prescribed under this paragraph.
 `(C) STRINGENCY- The standards prescribed under this paragraph shall be no
 less stringent than the capital standards applicable to national banks.
 `(D) DEADLINE FOR REGULATIONS- The Director shall promulgate final regulations
 under this paragraph not later than 90 days after the date of enactment of
 the Financial Institutions Reform, Recovery, and Enforcement Act of 1989,
 and those regulations shall become effective not later than 120 days after
 the date of enactment.
 `(2) Content of standards-
 `(A) LEVERAGE LIMIT- The leverage limit prescribed under paragraph (1)
 shall require a savings association to maintain core capital in an amount
 not less than 3 percent of the savings association's total assets.
 `(B) TANGIBLE CAPITAL REQUIREMENT- The tangible capital requirement prescribed
 under paragraph (1) shall require a savings association to maintain tangible
 capital in an amount not less than 1.5 percent of the savings association's
 total assets.
 `(C) RISK-BASED CAPITAL REQUIREMENT- Notwithstanding paragraph (1)(C), the
 risk-based capital requirement prescribed under paragraph (1) may deviate
 from the risk-based capital standards applicable to national banks to reflect
 interest-rate risk or other risks, but such deviations shall not, in the
 aggregate, result in materially lower levels of capital being required of
 savings associations under the risk-based capital requirement than would be
 required under the risk-based capital standards applicable to national banks.
 `(3) Transition rule-
 `(A) CERTAIN QUALIFYING SUPERVISORY GOODWILL INCLUDED IN CALCULATING CORE
 CAPITAL- Notwithstanding paragraph (9)(A), an eligible savings association
 may include qualifying supervisory goodwill in calculating core capital. The
 amount of qualifying supervisory goodwill that may be included may not exceed
 the applicable percentage of total assets set forth in the following table:
 `For the following
--The applicable
 period:
--percentage is:
 Prior to January 1, 1992
--1.500 percent
 January 1, 1992-December 31, 1992
--1.000 percent
 January 1, 1993-December 31, 1993
--0.750 percent
 January 1, 1994-December 31, 1994
--0.375 percent
 Thereafter
--0 percent
 `(B) ELIGIBLE SAVINGS ASSOCIATIONS- For purposes of subparagraph (A),
 a savings association is an eligible savings association so long as the
 Director determines that--
 `(i) the savings association's management is competent;
 `(ii) the savings association is in substantial compliance with all applicable
 statutes, regulations, orders, and supervisory agreements and directives; and
 `(iii) the savings association's management has not engaged in insider
 dealing, speculative practices, or any other activities that have jeopardized
 the association's safety and soundness or contributed to impairing the
 association's capital.
 `(4) Special rules for purchased mortgage servicing rights-
 `(A) IN GENERAL- Notwithstanding paragraphs (1)(C) and (9), the standards
 prescribed under paragraph (1) may permit a savings association to include
 in calculating capital for the purpose of the leverage limit and risk-based
 capital requirement prescribed under paragraph (1), on terms no less stringent
 than under both the capital standards applicable to State nonmember banks
 and (except as to the amount that may be included in calculating capital)
 the capital standards applicable to national banks, 90 percent of the fair
 market value of readily marketable purchased mortgage servicing rights.
 `(B) TANGIBLE CAPITAL REQUIREMENT- Notwithstanding paragraphs (1)(C) and
 (9)(C), the standards prescribed under paragraph (1) may permit a savings
 association to include in calculating capital for the purpose of the tangible
 capital requirement prescribed under paragraph (1), on terms no less stringent
 than under both the capital standards applicable to State nonmember banks
 and (except as to the amount that may be included in calculating capital)
 the capital standards applicable to national banks, 90 percent of the fair
 market value of readily marketable purchased mortgage servicing rights.
 `(C) PERCENTAGE LIMITATION PRESCRIBED BY FDIC- Notwithstanding paragraph
 (1)(C) and subparagraphs (A) and (B) of this paragraph--
 `(i) for the purpose of subparagraph (A), the maximum amount of purchased
 mortgage servicing rights that may be included in calculating capital under
 the leverage limit and the risk-based capital requirement prescribed under
 paragraph (1) may not exceed the amount that could be included if the
 savings association were an insured State nonmember bank; and
 `(ii) for the purpose of subparagraph (B), the Corporation shall prescribe
 a maximum percentage of the tangible capital requirement that savings
 associations may satisfy by including purchased mortgage servicing rights
 in calculating such capital.
 `(D) QUARTERLY VALUATION- The fair market value of purchased mortgage
 servicing rights shall be determined not less often than quarterly.
 `(5) Separate capitalization required for certain subsidiaries-
 `(A) IN GENERAL- In determining compliance with capital standards prescribed
 under paragraph (1), all of a savings association's investments in and
 extensions of credit to any subsidiary engaged in activities not permissible
 for a national bank shall be deducted from the savings association's capital.
 `(B) EXCEPTION FOR AGENCY ACTIVITIES- Subparagraph (A) shall not apply
 with respect to a subsidiary engaged, solely as agent for its customers,
 in activities not permissible for a national bank unless the Corporation,
 in its sole discretion, determines that, in the interests of safety and
 soundness, this subparagraph should cease to apply to that subsidiary.
 `(C) OTHER EXCEPTIONS- Subparagraph (A) shall not apply with respect to
 any of the following:
 `(i) MORTGAGE BANKING SUBSIDIARIES- A savings association's investments in
 and extensions of credit to a subsidiary engaged solely in mortgage-banking
 activities.
 `(ii) SUBSIDIARY INSURED DEPOSITORY INSTITUTIONS- A savings association's
 investments in and extensions of credit to a subsidiary--
 `(I) that is itself an insured depository institution or a company the sole
 investment of which is an insured depository institution, and
 `(II) that was acquired by the parent insured depository institution prior
 to May 1, 1989.
 `(iii) CERTAIN FEDERAL SAVINGS BANKS- Any Federal savings association
 existing as a Federal savings association on the date of enactment of the
 Financial Institutions Reform, Recovery, and Enforcement Act of 1989--
 `(I) that was chartered prior to October 15, 1982, as a savings bank or a
 cooperative bank under State law; or
 `(II) that acquired its principal assets from an association that was
 chartered prior to October 15, 1982, as a savings bank or a cooperative
 bank under State law.
 `(D) Transition rule-
 `(i) INCLUSION IN CAPITAL- Notwithstanding subparagraph (A), if a savings
 association's subsidiary was, as of April 12, 1989, engaged in activities
 not permissible for a national bank, the savings association may include
 in calculating capital the applicable percentage (set forth in clause (ii))
 of the lesser of--
 `(I) the savings association's investments in and extensions of credit to
 the subsidiary on April 12, 1989; or
 `(II) the savings association's investments in and extensions of credit to
 the subsidiary on the date as of which the savings association's capital
 is being determined.
 `(ii) APPLICABLE PERCENTAGE- For purposes of clause (i), the applicable
 percentage is as follows:
 `For the following
--The applicable
 period:
--percentage is:
 Prior to July 1, 1990
--100 percent
 July 1, 1990-June 30, 1991
--90 percent
 July 1, 1991-June 30, 1992
--75 percent
 July 1, 1992-June 30, 1993
--60 percent
 July 1, 1993-June 30, 1994
--40 percent
 Thereafter
--0 percent
 `(iii) FDIC'S DISCRETION TO PRESCRIBE LESSER PERCENTAGE- The Corporation
 may prescribe by order, with respect to a particular savings association,
 an applicable percentage less than that provided in clause (ii) if the
 Corporation determines, in its sole discretion, that the use of a greater
 percentage would, under the circumstances, constitute an unsafe or unsound
 practice or be likely to result in the association's being in an unsafe or
 unsound condition.
 `(E) CONSOLIDATION OF SUBSIDIARIES NOT SEPARATELY CAPITALIZED- In determining
 compliance with capital standards prescribed under paragraph (1), the assets
 and liabilities of each of a savings association's subsidiaries (other than
 any subsidiary described in subparagraph (C)(ii)) shall be consolidated with
 the savings association's assets and liabilities, unless all of the savings
 association's investments in and extensions of credit to the subsidiary are
 deducted from the savings association's capital pursuant to subparagraph (A).
 `(6) Consequences of failing to comply with capital standards-
 `(A) PRIOR TO JANUARY 1, 1991- Prior to January 1, 1991, the Director--
 `(i) may restrict the asset growth of any savings association not in
 compliance with capital standards; and
 `(ii) shall, beginning 60 days following the promulgation of final regulations
 under this subsection, require any savings association not in compliance
 with capital standards to submit a plan under subsection (s)(4)(A) that--
 `(I) addresses the savings association's need for increased capital;
 `(II) describes the manner in which the savings association will increase
 its capital so as to achieve compliance with capital standards;
 `(III) specifies the types and levels of activities in which the savings
 association will engage;
 `(IV) requires any increase in assets to be accompanied by an increase
 in tangible capital not less in percentage amount than the leverage limit
 then applicable;
 `(V) requires any increase in assets to be accompanied by an increase in
 capital not less in percentage amount than required under the risk-based
 capital standard then applicable; and
 `(VI) is acceptable to the Director.
 `(B) ON OR AFTER JANUARY 1, 1991- On or after January 1, 1991, the Director--
 `(i) shall prohibit any asset growth by any savings association not in
 compliance with capital standards, except as provided in subparagraph (C); and
 `(ii) shall require any savings association not in compliance with capital
 standards to comply with a capital directive issued by the Director (which
 may include such restrictions, including restrictions on the payment of
 dividends and on compensation, as the Director determines to be appropriate).
 `(C) LIMITED GROWTH EXCEPTION- The Director may permit any savings association
 that is subject to subparagraph (B) to increase its assets in an amount not
 exceeding the amount of net interest credited to the savings association's
 deposit liabilities if--
 `(i) the savings association obtains the Director's prior approval;
 `(ii) any increase in assets is accompanied by an increase in tangible
 capital in an amount not less than 6 percent of the increase in assets (or,
 in the Director's discretion if the leverage limit then applicable is less
 than 6 percent, in an amount equal to the increase in assets multiplied by
 the percentage amount of the leverage limit);
 `(iii) any increase in assets is accompanied by an increase in capital
 not less in percentage amount than required under the risk-based capital
 standard then applicable;
 `(iv) any increase in assets is invested in low-risk assets, such as first
 mortgage loans secured by 1- to 4-family residences and fully secured
 consumer loans; and
 `(v) the savings association's ratio of core capital to total assets is
 not less than the ratio existing on January 1, 1991.
 `(D) ADDITIONAL RESTRICTIONS IN CASE OF EXCESSIVE RISKS OR RATES- The Director
 may restrict the asset growth of any savings association that the Director
 determines is taking excessive risks or paying excessive rates for deposits.
 `(E) FAILURE TO COMPLY WITH PLAN, REGULATION, OR ORDER- The Director
 shall treat as an unsafe and unsound practice any material failure by a
 savings association to comply with any plan, regulation, or order under
 this paragraph.
 `(F) EFFECT ON OTHER REGULATORY AUTHORITY- This paragraph does not limit
 any authority of the Director under other provisions of law.
 `(7) Exemption from certain sanctions-
 `(A) APPLICATION FOR EXEMPTION- Any savings association not in compliance
 with the capital standards prescribed under paragraph (1) may apply to
 the Director for an exemption from any applicable sanction or penalty for
 noncompliance which the Director may impose.
 `(B) EFFECT OF GRANT OF EXEMPTION- If the Director approves any savings
 association's application under subparagraph (A), the only sanction
 or penalty to be imposed by the Director for the savings association's
 failure to comply with the capital standards prescribed under paragraph
 (1) is the growth limitation contained in paragraph (6)(B) or paragraph
 (6)(C), whichever is applicable.
 `(C) STANDARDS FOR APPROVAL OR DISAPPROVAL-
 `(i) APPROVAL- The Director may approve an application for an exemption if
 the Director determines that--
 `(I) such exemption would pose no significant risk to the affected deposit
 insurance fund;
 `(II) the savings association's management is competent;
 `(III) the savings association is in substantial compliance with all
 applicable statutes, regulations, orders, and supervisory agreements and
 directives; and
 `(IV) the savings association's management has not engaged in insider dealing,
 speculative practices, or any other activities that have jeopardized
 the association's safety and soundness or contributed to impairing the
 association's capital.
 `(ii) DENIAL OR REVOCATION OF APPROVAL- The Director shall deny any
 application submitted under clause (i) and revoke any prior approval
 granted with respect to any such application if the Director determines
 that the association's failure to meet any capital standards prescribed
 under paragraph (1) is accompanied by--
 `(I) a pattern of consistent losses;
 `(II) substantial dissipation of assets;
 `(III) evidence of imprudent management or business behavior;
 `(IV) a material violation of any Federal law, any law of any State to
 which such association is subject, or any applicable regulation; or
 `(V) any other unsafe or unsound condition or activity, other than the
 failure to meet such capital standards.
 `(D) SUBMISSION OF PLAN REQUIRED- Any application submitted under subparagraph
 (A) shall be accompanied by a plan which--
 `(i) meets the requirements of paragraph (6)(A)(ii); and
 `(ii) is acceptable to the Director.
 `(E) FAILURE TO COMPLY WITH PLAN- The Director shall treat as an unsafe and
 unsound practice any material failure by any savings association which has
 been granted an exemption under this paragraph to comply with the provisions
 of any plan submitted by such association under subparagraph (D).
 `(F) EXEMPTION NOT AVAILABLE WITH RESPECT TO UNSAFE OR UNSOUND PRACTICES-
 This paragraph does not limit any authority of the Director under any other
 provision of law, including section 8 of the Federal Deposit Insurance
 Act, to take any appropriate action with respect to any unsafe or unsound
 practice or condition of any savings association, other than the failure
 of such savings association to comply with the capital standards prescribed
 under paragraph (1).
 `(8) Temporary authority to make exceptions for eligible savings associations-
 `(A) IN GENERAL- Notwithstanding paragraph (1)(C), the Director may, by
 order, make exceptions to the capital standards prescribed under paragraph
 (1) for eligible savings associations. No exception under this paragraph
 shall be effective after January 1, 1991.
 `(B) STANDARDS FOR APPROVAL OR DISAPPROVAL- In determining whether to
 grant an exception under subparagraph (A), the Director shall apply the
 same standards as apply to determinations under paragraph (7)(C).
 `(9) DEFINITIONS- For purposes of this subsection--
 `(A) CORE CAPITAL- Unless the Director prescribes a more stringent definition,
 the term `core capital' means core capital as defined by the Comptroller
 of the Currency for national banks, less any unidentifiable intangible
 assets, plus any purchased mortgage servicing rights excluded from the
 Comptroller's definition of capital but included in calculating the core
 capital of savings associations pursuant to paragraph (4).
 `(B) QUALIFYING SUPERVISORY GOODWILL- The term `qualifying supervisory
 goodwill' means supervisory goodwill existing on April 12, 1989, amortized
 on a straightline basis over the shorter of--
 `(i) 20 years, or
 `(ii) the remaining period for amortization in effect on April 12, 1989.
 `(C) TANGIBLE CAPITAL- The term `tangible capital' means core capital minus
 any intangible assets (as intangible assets are defined by the Comptroller
 of the Currency for national banks).
 `(D) TOTAL ASSETS- The term `total assets' means total assets (as total
 assets are defined by the Comptroller of the Currency for national banks)
 adjusted in the same manner as total assets would be adjusted in determining
 compliance with the leverage limit applicable to national banks if the
 savings association were a national bank.
 `(10) Use of comptroller's definitions-
 (A) IN GENERAL- The standards prescribed under paragraph (1) shall include
 all relevant substantive definitions established by the Comptroller of the
 Currency for national banks.
 `(B) SPECIAL RULE- If the Comptroller of the Currency has not made effective
 regulations defining core capital or establishing a risk-based capital
 standard, the Director shall use the definition and standard contained in
 the Comptroller's most recently published final regulations.
 `(u) Limits on Loans to One Borrower-
 `(1) IN GENERAL- Section 5200 of the Revised Statutes shall apply to savings
 associations in the same manner and to the same extent as it applies to
 national banks.
 `(2) Special rules-
 `(A) Notwithstanding paragraph (1), a savings association may make loans
 to one borrower under one of the following clauses:
 `(i) for any purpose, not to exceed $500,000; or
 `(ii) to develop domestic residential housing units, not to exceed the
 lesser of $30,000,000 or 30 percent of the savings association's unimpaired
 capital and unimpaired surplus, if--
 `(I) the purchase price of each single family dwelling unit the development
 of which is financed under this clause does not exceed $500,000;
 `(II) the savings association is and continues to be in compliance with
 the fully phased-in capital standards prescribed under subsection (t);
 `(III) the Director, by order, permits the savings association to avail
 itself of the higher limit provided by this clause;
 `(IV) loans made under this clause to all borrowers do not, in aggregate,
 exceed 150 percent of the savings association's unimpaired capital and
 unimpaired surplus; and
 `(V) such loans comply with all applicable loan-to-value requirements.
 `(B) A savings association's loans to one borrower to finance the sale
 of real property acquired in satisfaction of debts previously contracted
 in good faith shall not exceed 50 percent of the savings association's
 unimpaired capital and unimpaired surplus.
 `(3) AUTHORITY TO IMPOSE MORE STRINGENT RESTRICTIONS- The Director may
 impose more stringent restrictions on a savings association's loans to one
 borrower if the Director determines that such restrictions are necessary
 to protect the safety and soundness of the savings association.
 `(v) Reports of Condition-
 `(1) IN GENERAL- Each association shall make reports of conditions to the
 Director which shall be in a form prescribed by the Director and shall
 contain--
 `(A) information sufficient to allow the identification of potential interest
 rate and credit risk;
 `(B) a description of any assistance being received by the association,
 including the type and monetary value of such assistance;
 `(C) the identity of all subsidiaries and affiliates of the association;
 `(D) the identity, value, type, and sector of investment of all equity
 investments of the associations and subsidiaries; and
 `(E) other information that the Director may prescribe.
 `(2) Public disclosure-
 `(A) Reports required under paragraph (1) and all information contained
 therein shall be available to the public upon request, unless the Director
 determines--
 `(i) that a particular item or classification of information should not be
 made public in order to protect the safety or soundness of the institution
 concerned or institutions concerned, the Savings Association Insurance
 Fund; or
 `(ii) that public disclosure would not otherwise be in the public interest.
 `(B) Any determination made by the Director under subparagraph (A) not to
 permit the public disclosure of information shall be made in writing, and
 if the Director restricts any item of information for savings institutions
 generally, the Director shall disclose the reason in detail in the Federal
 Register.
 `(C) The Director's determinations under subparagraph (A) shall not be
 subject to judicial review.
 `(3) Access by certain parties-
 `(A) Notwithstanding paragraph (2), the persons described in subparagraph
 (B) shall not be denied access to any information contained in a report
 of condition, subject to reasonable requirements of confidentiality. Those
 requirements shall not prevent such information from being transmitted to
 the Comptroller General of the United States for analysis.
 `(B) The following persons are described in this subparagraph for purposes
 of subparagraph (A):
 `(i) the Chairman and ranking minority member of the Committee on Banking,
 Housing, and Urban Affairs of the Senate and their designees; and
 `(ii) the Chairman and ranking minority member of the Committee on Banking,
 Finance and Urban Affairs of the House of Representatives and their designees.
 `(4) FIRST TIER PENALTIES- Any savings association which--
 `(A) maintains procedures reasonably adapted to avoid any inadvertent and
 unintentional error and, as a result of such an error--
 `(i) fails to submit or publish any report or information required by the
 Director under paragraph (1) or (2), within the period of time specified
 by the Director; or
 `(ii) submits or publishes any false or misleading report or information; or
 `(B) inadvertently transmits or publishes any report which is minimally late,
shall be subject to a penalty of not more than $2,000 for each day during
which such failure continues or such false or misleading information is not
corrected. The savings association shall have the burden of proving by a
preponderence of the evidence that an error was inadvertent and unintentional
and that a report was inadvertently transmitted or published late.
 `(5) SECOND TIER PENALTIES- Any savings association which--
 `(A) fails to submit or publish any report or information required by the
 Director under paragraph (1) or (2), within the period of time specified
 by the Director; or
 `(B) submits or publishes any false or misleading report or information,
in a manner not described in paragraph (4) shall be subject to a penalty of
not more than $20,000 for each day during which such failure continues or
such false or misleading information is not corrected.
 `(6) THIRD TIER PENALTIES- If any savings association knowingly or with
 reckless disregard for the accuracy of any information or report described
 in paragraph (5) submits or publishes any false or misleading report or
 information, the Director may assess a penalty of not more than $1,000,000
 or 1 percent of total assets, whichever is less, per day for each day during
 which such failure continues or such false or misleading information is
 not corrected.
 `(7) ASSESSMENT- Any penalty imposed under paragraph (4), (5), or (6)
 shall be assessed and collected by the Director in the manner provided
 in subparagraphs (E), (F), (G), and (I) of section 8(i)(2) of the Federal
 Deposit Insurance Act (for penalties imposed under such section), and any
 such assessment (including the determination of the amount of the penalty)
 shall be subject to the provisions of such subsection.
 `(8) HEARING- Any savings association against which any penalty is assessed
 under this subsection shall be afforded a hearing if such savings association
 submits a request for such hearing within 20 days after the issuance of
 the notice of assessment. Section 8(h) of the Federal Deposit Insurance
 Act shall apply to any proceeding under this subsection.
`SEC. 6. LIQUID ASSET REQUIREMENTS.
 `(a) IN GENERAL- The purpose of this section is to provide a means for
 creating effective and flexible liquidity in savings associations which can be
 increased when mortgage money is plentiful, maintained in easily liquidated
 instruments, and reduced to add to the flow of funds to the mortgage market
 in periods of credit stringency. More flexible liquidity will help support
 sound mortgage credit and a more stable supply of such credit.
 `(b) Maintenance of Account-
 `(1) IN GENERAL- Every savings association shall maintain the aggregate
 amount of its assets of the following types at not less than such amount as,
 in the opinion of the Director, is appropriate:
 `(A) cash;
 `(B) balances maintained in a Federal reserve bank or passed through a
 Federal home loan bank or another depository institution to a Federal
 reserve bank pursuant to the Federal Reserve Act; and
 `(C) to such extent as the Director may approve for the purposes of this
 section--
 `(i) time and savings deposits in Federal home loan banks, institutions
 which are, or are eligible to become, members thereof, and commercial banks;
 `(ii) such obligations, including such special obligations, of the United
 States, a State, any territory or possession of the United States, or a
 political subdivision, agency, or instrumentality of any one or more of
 the foregoing, and bankers' acceptances, as the Director may approve;
 `(iii) shares or certificates of any open-end management investment company
 which is registered with the Securities and Exchange Commission under the
 Investment Company Act of 1940 and the portfolio of which is restricted by
 such investment company's investment policy, changeable only if authorized
 by shareholder vote, solely to any of the obligations or other investments
 enumerated in subparagraph (A) and in clauses (i), (ii), (iv), (v), (vi),
 and (vii) of this subparagraph;
 `(iv) liquid, highly rated corporate debt obligations with 3 years or less
 remaining until maturity;
 `(v) highly rated commercial paper with 270 days or less remaining until
 maturity;
 `(vi) mortgage related securities (as that term is defined in section 3(a)(41)
 of the Securities Exchange Act of 1934)--
 `(I) that have one year or less remaining until maturity; or
 `(II) that are subject to an agreement (including a repurchase agreement,
 put option, right of redemption, or takeout commitment) that requires another
 person to purchase the securities within a period that does not exceed one
 year, and that person is an insured depository institution (as defined in
 section 3 of the Federal Deposit Insurance Act) that is in compliance with
 applicable capital standards, a primary dealer in United States Government
 securities, or a broker or dealer registered under the Securities Exchange
 Act of 1934; and
 `(vii) mortgage loans on the security of a first lien on residential real
 property, if the mortgage loans qualify as backing for mortgage-backed
 securities issued by the Federal National Mortgage Association or the
 Federal Home Loan Mortgage Association or guaranteed by the Government
 National Mortgage Association, and either--
 `(I) the mortgage loans have one year or less remaining until maturity, or
 `(II) the mortgage loans are subject to an agreement (including a repurchase
 agreement, put option, right of redemption, or takeout commitment) that
 requires another person to purchase the loans within a period that does
 not exceed one year, and that person is an insured depository institution
 (as defined in section 3 of the Federal Deposit Insurance Act) that is in
 compliance with applicable capital standards, a primary dealer in United
 States Government securities, or a broker or dealer registered under the
 Securities Exchange Act of 1934.
 `(2) LIMITATION- The requirement prescribed by the Director pursuant to
 this subsection (hereafter in this section referred to as the `liquidity
 requirement') may not be less than 4 percent or more than 10 percent of the
 obligation of the institution on withdrawable accounts and borrowings payable
 on demand or with unexpired maturities of one year or less. The Director
 shall prescribe regulations to implement the provisions of this subsection.
 `(c) CALCULATION- The amount of any savings association's liquidity
 requirement, and any deficiency in compliance therewith, shall be
 calculated as the Director shall prescribe. The Director may prescribe
 different liquidity requirements, within the limitations specified herein,
 for different classes of savings associations, and for such purposes the
 Director is authorized to classify savings associations according to type,
 size, location, rate of withdrawals, or on such other basis or bases of
 differentiation as the Director may deem to be reasonably necessary or
 appropriate for the purposes of this section.
 `(d) DEFICIENCY ASSESSMENTS- For any deficiency in compliance with the
 liquidity requirements, the Director may, in the Director's discretion,
 assess a penalty consisting of the payment by the institution of such
 sum as may be assessed by the Director but not in excess of a rate equal
 to the highest rate on Federal home loan bank advances of one year or
 less, plus 2 percent per year, on the amount of the deficiency for the
 period with respect to which the deficiency existed. Any penalty assessed
 under this subsection against a savings association shall be paid to the
 Director. The Director may authorize or require that, at any time before
 collection thereof, and whether before or after the bringing of any action
 or other legal proceeding, the obtaining of any judgment or other recovery,
 or the issuance or levy of any execution or other legal process therefor, and
 with or without consideration, any such penalty or recovery be compromised,
 remitted, or mitigated in whole or part. The penalties authorized under this
 subsection are in addition to all remedies and sanctions otherwise available.
 `(e) REDUCTION OR SUSPENSION- Whenever the Director deems it advisable
 in order to enable a savings association to meet withdrawals or to pay
 obligations, the Director may, to such extent and subject to such conditions
 as the Director may prescribe, permit the savings association to reduce
 its liquidity below the minimum amount. Whenever the Director determines
 that conditions of national emergency or unusual economic stress exist, the
 Director may suspend any part or all of the liquidity requirements hereunder
 for such period as the Director may prescribe. Any such suspension, unless
 sooner terminated by its terms or by the Director, shall terminate at the
 expiration of 90 days next after its commencement. The preceding sentence
 does not prevent the Director from again exercising, before, at, or after
 any such termination, the authority conferred by this subsection.
 `(f) REGULATING AUTHORITY- The Director is authorized to issue such
 regulations, including definitions of terms used in this section, to make
 such examinations, and to conduct such investigations as the Director deems
 necessary or appropriate to effectuate the purposes of this section. The
 reasonable cost of any such examination or investigation, as determined by
 the Director, shall be paid by the association.
`SEC. 7. APPLICABILITY.
 `The provisions of this Act shall apply to the United States and to Puerto
 Rico, Guam, and the Virgin Islands.
`SEC. 8. DISTRICT ASSOCIATIONS.
 `(a) IN GENERAL- The Director shall, with respect to all incorporated or
 unincorporated building, building or loan, building and loan, or homestead
 associations, and similar institutions, of or transacting or doing business
 in the District of Columbia, or maintaining any office in the District of
 Columbia (other than Federal savings associations), have the same powers
 and functions as to examination, operation, and regulation as the Director
 has with respect to Federal savings associations.
 `(b) ADDITIONAL POWERS- Any such association or institution incorporated
 under the laws of, or organized in, the District of Columbia shall have in
 addition to any existing statutory authority such statutory authority as
 is vested in Federal savings associations.
 `(c) CHARTER AMENDMENTS- Charters, certificates of incorporation, articles
 of incorporation, constitutions, bylaws, or other organic documents of
 associations or institutions referred to in subsection (b) of this section
 may, without regard to anything contained therein or otherwise, be amended
 in such manner and to such extent and upon such votes if any as the Director
 may by regulation or otherwise provide.
 `(d) LIMITATION- Nothing in this section shall cause, or permit the Director
 to cause, District of Columbia associations to be or become Federal savings
 associations, or require the Director to impose on District of Columbia
 associations the same regulations as are imposed on Federal savings
 associations.
`SEC. 9. EXAMINATION FEES.
 `(a) EXAMINATION OF SAVINGS ASSOCIATIONS- The cost of conducting examinations
 of savings associations pursuant to section 5(d) of this Act shall be assessed
 by the Director against each such savings association in proportion to the
 assets or resources of the savings association.
 `(b) EXAMINATION OF AFFILIATES- The cost of conducting examinations of
 affiliates of savings associations pursuant to this Act may be assessed by
 the Director against each affiliate which is examined in proportion to the
 assets or resources held by the affiliate on the date of any such examination.
 `(c) ASSESSMENT AGAINST ASSOCIATION IN CASE OF AFFILIATE'S REFUSAL TO PAY-
 `(1) IN GENERAL- Subject to paragraph (2), if any affiliate of any savings
 association--
 `(A) refuses to pay any assessment under subsection (b); or
 `(B) fails to pay any such assessment before the end of the 60-day period
 beginning on the date of the assessment,
the Director may assess such cost against, and collect such cost from,
such savings association.
 `(2) AFFILIATE OF MORE THAN 1 SAVINGS ASSOCIATION- If any affiliate referred
 to in paragraph (1) is an affiliate of more than 1 savings association,
 the assessment with respect to the affiliate against, and collected from,
 any affiliated savings association in such proportions as the Director
 may prescribe.
 `(d) CIVIL MONEY PENALTY FOR AFFILIATE'S REFUSAL TO COOPERATE-
 `(1) PENALTY IMPOSED- If any affiliate of any savings association--
 `(A) refuses to permit any examiner appointed by the Director to make an
 examination; or
 `(B) refuses to provide any information required to be disclosed in the
 course of any examination,
the savings association shall forfeit and pay a civil penalty of not more
than $5,000 for each day that any such refusal continues.
 `(2) ASSESSMENT AND COLLECTION- Any penalty imposed under paragraph (1)
 shall be assessed and collected by the Director, in the manner provided in
 section 8(i)(2) of the Federal Deposit Insurance Act.
 `(e) REGULATIONS- Only the Director may prescribe regulations with respect
 to--
 `(1) the computation of, and the assessment for, the cost of conducting
 examinations pursuant to this section; and
 `(2) the collection and use of such assessments and any fees under this
 section.
Such regulations may establish formulas to determine a fee or schedule of fees
to cover the costs of examinations and also to cover the cost of processing
applications, filings, notices, and requests for approvals by the Director
or the Director's designee.
 `(f) COLLECTION THROUGH FDIC OR FEDERAL HOME LOAN BANKS- The Corporation or
 the Federal home loan banks shall, upon request of and by agreement with
 the Director, collect fees and assessments on behalf of the Director and
 be reimbursed for the actual cost of collection.
 `(g) COSTS OF OTHER EXAMINATIONS-
 `(1) EXAMINATION OF FIDUCIARY ACTIVITIES- In addition to any assessment
 imposed pursuant to subsection (a), the cost of conducting examinations of
 fiduciary activities of savings associations which exercise fiduciary powers
 (including savings associations or similar institutions in the District of
 Columbia) shall be assessed by the Director against such savings associations
 (or similar institutions).
 `(2) EXAMINATIONS IN EXCESS OF 2 PER CALENDAR YEAR- If any savings association
 or affiliate of a savings association is examined by the Director, or the
 Corporation, as the case may be, more than 2 times in any calendar year,
 the cost of conducting such additional examinations shall be assessed,
 in addition to any assessment imposed pursuant to subsection (a), by the
 Director or the Corporation, as the case may be, against such savings
 association or affiliate.
 `(h) ADDITIONAL INFORMATION- Any savings association and any affiliate
 of any savings association shall provide the Director with access to any
 information or report with respect to any examination made by any public
 regulatory authority and furnish any additional information with respect
 thereto as the Director may require.
 `(i) TREATMENT OF EXAMINATION ASSESSMENTS-
 `(1) DEPOSITS- Amounts received by the Director from assessments under this
 section (other than an assessment under subsection (d)(2)) or section 10(b)(4)
 may be deposited in the manner provided in section 5234 of the Revised
 Statutes with respect to assessments by the Comptroller of the Currency.
 `(2) ASSESSMENTS ARE NOT GOVERNMENT FUNDS- The amounts received by the
 Director from any assessment under this section shall not be construed to
 be Government or public funds or appropriated money.
 `(3) ASSESSMENTS ARE NOT SUBJECT TO APPORTIONMENT OF FUNDS- Notwithstanding
 any other provision of law, the amounts received by the Director from any
 assessment under this section shall not be subject to apportionment for
 the purpose of chapter 15 of title 31, United States Code, or under any
 other authority.
 `(j) PROCESSING FEE- The Director may, in the Director's sole discretion,
 assess against any person that submits to the Director an application, filing,
 notice, or request a fee to cover the cost of processing such submission.
 `(k) FEES FOR EXAMINATIONS AND SUPERVISORY ACTIVITIES- The Director may
 assess against institutions for which the Director is the appropriate
 Federal banking agency, within the meaning of section 3 of the Federal
 Deposit Insurance Act, fees to fund the direct and indirect expenses of the
 Office. Such fees shall be imposed in proportion of the assets or resources
 of the institutions. The fees may be imposed more frequently than annually
 at the discretion of the Director. The annual rate of such fees shall be
 the same for all institutions subject to such fees.
 `(l) WORKING CAPITAL- The Director is authorized to impose fees and
 assessments pursuant to subsections (a), (b), (e), and (k) of this section,
 in excess of actual expenses for any given year, to permit the Director to
 maintain a working capital fund. The Director shall remit to the payors of
 such fees and assessments any funds collected in excess of what he deems
 necessary to maintain such working capital fund.
 `(m) USE OF FUNDS- The Director is authorized to use the combined resources
 retained through fees and assessments imposed pursuant to this section to pay
 all direct and indirect salary and administrative expenses of the Office,
 including contracts and purchases of property and services, and the direct
 and indirect expenses of the examinations and supervisory activities of
 the Office.
`SEC. 10. REGULATION OF HOLDING COMPANIES.
 `(a) DEFINITIONS-
 `(1) IN GENERAL- As used in this section, unless the context otherwise
 requires--
 `(A) SAVINGS ASSOCIATION- The term `savings association' includes a savings
 bank or cooperative bank which is deemed by the Director to be a savings
 association under subsection (l).
 `(B) UNINSURED INSTITUTION- The term `uninsured institution' means any
 depository institution the deposits of which are not insured by the Federal
 Deposit Insurance Corporation.
 `(C) COMPANY- The term `company' means any corporation, partnership, trust,
 joint-stock company, or similar organization, but does not include the
 Federal Deposit Insurance Corporation, the Resolution Trust Corporation,
 any Federal home loan bank, or any company the majority of the shares of
 which is owned by the United States or any State, or by an instrumentality
 of the United States or any State.
 `(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.
 `(E) MULTIPLE SAVINGS AND LOAN HOLDING COMPANY- The term `multiple savings
 and loan holding company' means any savings and loan holding company which
 directly or indirectly controls 2 or more savings associations.
 `(F) DIVERSIFIED SAVINGS AND LOAN HOLDING COMPANY- The term `diversified
 savings and loan holding company' means any savings and loan holding company
 whose subsidiary savings association and related activities as permitted
 under paragraph (2) of subsection (c) of this section represented, on either
 an actual or a pro forma basis, less than 50 percent of its consolidated net
 worth at the close of its preceding fiscal year and of its consolidated net
 earnings for such fiscal year, as determined in accordance with regulations
 issued by the Director.
 `(G) SUBSIDIARY- The term `subsidiary' has the same meaning as in section
 3 of the Federal Deposit Insurance Act.
 `(H) AFFILIATE- The term `affiliate' of a savings association means any
 person which controls, is controlled by, or is under common control with,
 such savings association.
 `(I) BANK HOLDING COMPANY- The terms `bank holding company' and `bank'
 have the meanings given to such terms in section 2 of the Bank Holding
 Company Act of 1956.
 `(J) ACQUIRE- The term `acquire' has the meaning given to such term in
 section 13(f)(8) of the Federal Deposit Insurance Act.
 `(2) CONTROL- For purposes of this section, a person shall be deemed to
 have control of--
 `(A) a savings association if the person directly or indirectly or acting in
 concert with one or more other persons, or through one or more subsidiaries,
 owns, controls, or holds with power to vote, or holds proxies representing,
 more than 25 percent of the voting shares of such savings association,
 or controls in any manner the election of a majority of the directors of
 such association;
 `(B) any other company if the person directly or indirectly or acting in
 concert with one or more other persons, or through one or more subsidiaries,
 owns, controls, or holds with power to vote, or holds proxies representing,
 more than 25 percent of the voting shares or rights of such other company,
 or controls in any manner the election or appointment of a majority of the
 directors or trustees of such other company, or is a general partner in or
 has contributed more than 25 percent of the capital of such other company;
 `(C) a trust if the person is a trustee thereof; or
 `(D) a savings association or any other company if the Director determines,
 after reasonable notice and opportunity for hearing, that such person
 directly or indirectly exercises a controlling influence over the management
 or policies of such association or other company.
 `(3) EXCLUSIONS- Notwithstanding any other provision of this subsection,
 the term `savings and loan holding company' does not include--
 `(A) any company by virtue of its ownership or control of voting shares
 of a savings association or a savings and loan holding company acquired
 in connection with the underwriting of securities if such shares are held
 only for such period of time (not exceeding 120 days unless extended by
 the Director) as will permit the sale thereof on a reasonable basis; and
 `(B) any trust (other than a pension, profit-sharing, shareholders', voting,
 or business trust) which controls a savings association or a savings and loan
 holding company if such trust by its terms must terminate within 25 years or
 not later than 21 years and 10 months after the death of individuals living
 on the effective date of the trust, and is (i) in existence on June 26,
 1967, or (ii) a testamentary trust created on or after June 26, 1967.
 `(4) SPECIAL RULE RELATING TO QUALIFIED STOCK ISSUANCE- No savings and loan
 holding company shall be deemed to control a savings association solely by
 reason of the purchase by such savings and loan holding company of shares
 issued by such savings association, or issued by any savings and loan
 holding company (other than a bank holding company) which controls such
 savings association, in connection with a qualified stock issuance if such
 purchase is approved by the Director under subsection (q)(1)(D), unless the
 acquiring savings and loan holding company, directly or indirectly, or acting
 in concert with 1 or more other persons, or through 1 or more subsidiaries,
 owns, controls, or holds with power to vote, or holds proxies representing,
 more than 15 percent of the voting shares of such savings association or
 holding company.
 `(b) REGISTRATION AND EXAMINATION-
 `(1) IN GENERAL- Within 90 days after becoming a savings and loan holding
 company, each savings and loan holding company shall register with the
 Director on forms prescribed by the Director, which shall include such
 information, under oath or otherwise, with respect to the financial condition,
 ownership, operations, management, and intercompany relationships of such
 holding company and its subsidiaries, and related matters, as the Director may
 deem necessary or appropriate to carry out the purposes of this section. Upon
 application, the Director may extend the time within which a savings and
 loan holding company shall register and file the requisite information.
 `(2) REPORTS- Each savings and loan holding company and each subsidiary
 thereof, other than a savings association, shall file with the Director, and
 the regional office of the Director of the district in which its principal
 office is located, such reports as may be required by the Director. Such
 reports shall be made under oath or otherwise, and shall be in such form and
 for such periods, as the Director may prescribe. Each report shall contain
 such information concerning the operations of such savings and loan holding
 company and its subsidiaries as the Director may require.
 `(3) BOOKS AND RECORDS- Each savings and loan holding company shall maintain
 such books and records as may be prescribed by the Director.
 `(4) EXAMINATIONS- Each savings and loan holding company and each subsidiary
 thereof (other than a bank) shall be subject to such examinations as the
 Director may prescribe. The cost of such examinations shall be assessed
 against and paid by such holding company. Examination and other reports
 may be furnished by the Director to the appropriate State supervisory
 authority. The Director shall, to the extent deemed feasible, use for the
 purposes of this subsection reports filed with or examinations made by
 other Federal agencies or the appropriate State supervisory authority.
 `(5) AGENT FOR SERVICE OF PROCESS- The Director may require any savings
 and loan holding company, or persons connected therewith if it is not a
 corporation, to execute and file a prescribed form of irrevocable appointment
 of agent for service of process.
 `(6) RELEASE FROM REGISTRATION- The Director may at any time, upon the
 Director's own motion or upon application, release a registered savings and
 loan holding company from any registration theretofore made by such company,
 if the Director determines that such company no longer has control of any
 savings association.
 `(c) Holding Company Activities-
 `(1) PROHIBITED ACTIVITIES- Except as otherwise provided in this subsection,
 no savings and loan holding company and no subsidiary which is not a savings
 association shall--
 `(A) engage in any activity or render any service for or on behalf of
 a savings association subsidiary for the purpose or with the effect of
 evading any law or regulation applicable to such savings association;
 `(B) commence any business activity, other than the activities described
 in paragraph (2); or
 `(C) continue any business activity, other than the activities described in
 paragraph (2), after the end of the 2-year period beginning on the date on
 which such company received approval under subsection (e) of this section
 to become a savings and loan holding company subject to the limitations
 contained in this subparagraph.
 `(2) EXEMPT ACTIVITIES- The prohibitions of subparagraphs (B) and (C)
 of paragraph (1) shall not apply to the following business activities of
 any savings and loan holding company or any subsidiary (of such company)
 which is not a savings association:
 `(A) Furnishing or performing management services for a savings association
 subsidiary of such company.
 `(B) Conducting an insurance agency or escrow business.
 `(C) Holding, managing, or liquidating assets owned or acquired from a
 savings association subsidiary of such company.
 `(D) Holding or managing properties used or occupied by a savings association
 subsidiary of such company.
 `(E) Acting as trustee under deed of trust.
 `(F) Any other activity--
 `(i) which the Board of Governors of the Federal Reserve System, by
 regulation, has determined to be permissible for bank holding companies under
 section 4(c) of the Bank Holding Company Act of 1956, unless the Director,
 by regulation, prohibits or limits any such activity for savings and loan
 holding companies; or
 `(ii) in which multiple savings and loan holding companies were authorized
 (by regulation) to directly engage on March 5, 1987.
 `(G) In the case of a savings and loan holding company, purchasing, holding,
 or disposing of stock acquired in connection with a qualified stock issuance
 if the purchase of such stock by such savings and loan holding company is
 approved by the Director pursuant to subsection (q)(1)(D).
 `(3) CERTAIN LIMITATIONS ON ACTIVITIES NOT APPLICABLE TO CERTAIN HOLDING
 COMPANIES- Notwithstanding paragraphs (4) and (6) of this subsection,
 the limitations contained in subparagraphs (B) and (C) of paragraph (1)
 shall not apply to any savings and loan holding company (or any subsidiary
 of such company) which controls--
 `(A) only 1 savings association, if the savings association subsidiary of such
 company is a qualified thrift lender (as determined under subsection (m)); or
 `(B) more than 1 savings association, if--
 `(i) all, or all but 1, of the savings association subsidiaries of such
 company were initially acquired by the company or by an individual who
 would be deemed to control such company if such individual were a company--
 `(I) pursuant to an acquisition under section 13(c) or 13(k) of the Federal
 Deposit Insurance Act or section 408(m) of the National Housing Act; or
 `(II) pursuant to an acquisition in which assistance was continued to a
 savings association under section 13(i) of the Federal Deposit Insurance
 Act; and
 `(ii) all of the savings association subsidiaries of such company are
 qualified thrift lenders (as determined under subsection (m)).
 `(4) PRIOR APPROVAL OF CERTAIN NEW ACTIVITIES REQUIRED-
 `(A) IN GENERAL- No savings and loan holding company and no subsidiary
 which is not a savings association shall commence, either de novo or by an
 acquisition (in whole or in part) of a going concern, any activity described
 in paragraph (2)(F)(i) of this subsection without the prior approval of
 the Director.
 `(B) FACTORS TO BE CONSIDERED BY DIRECTOR- In considering any application
 under subparagraph (A) by any savings and loan holding company or any
 subsidiary of any such company which is not a savings association, the
 Director shall consider--
 `(i) whether the performance of the activity described in such application by
 the company or the subsidiary 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 of such activity
 (such as undue concentration of resources, decreased or unfair competition,
 conflicts of interest, or unsound financial practices);
 `(ii) the managerial resources of the companies involved; and
 `(iii) the adequacy of the financial resources, including capital, of the
 companies involved.
 `(C) DIRECTOR MAY DIFFERENTIATE BETWEEN NEW AND ONGOING ACTIVITIES-
 In prescribing any regulation or considering any application under this
 paragraph, the Director may differentiate between activities commenced
 de novo and activities commenced by the acquisition, in whole or in part,
 of a going concern.
 `(D) APPROVAL OR DISAPPROVAL BY ORDER- The approval or disapproval of
 any application under this paragraph by the Director shall be made in
 an order issued by the Director containing the reasons for such approval
 or disapproval.
 `(5) GRACE PERIOD TO ACHIEVE COMPLIANCE- If any savings association referred
 to in paragraph (3) fails to maintain the status of such association as
 a qualified thrift lender, the Director may allow, for good cause shown,
 any company that controls such association (or any subsidiary of such
 company which is not a savings association) up to 3 years to comply with
 the limitations contained in paragraph (1)(C).
 `(6) SPECIAL PROVISIONS RELATING TO CERTAIN COMPANIES AFFECTED BY 1987
 AMENDMENTS-
 `(A) EXCEPTION TO 2-YEAR GRACE PERIOD FOR ACHIEVING COMPLIANCE-
 Notwithstanding paragraph (1)(C), any company which received approval under
 subsection (e) of this section to acquire control of a savings association
 between March 5, 1987, and August 10, 1987, shall not continue any business
 activity other than an activity described in paragraph (2) after August
 10, 1987.
 `(B) EXEMPTION FOR ACTIVITIES LAWFULLY ENGAGED IN BEFORE MARCH 5, 1987-
 Notwithstanding paragraph (1)(C) and subject to subparagraphs (C) and (D),
 any savings and loan holding company which received approval, before March 5,
 1987, under subsection (e) of this section to acquire control of a savings
 association may engage, directly or through any subsidiary (other than a
 savings association subsidiary of such company), in any activity in which
 such company or such subsidiary was lawfully engaged on such date.
 `(C) TERMINATION OF SUBPARAGRAPH (B) EXEMPTION- The exemption provided under
 subparagraph (B) for activities engaged in by any savings and loan holding
 company or a subsidiary of such company (which is not a savings association)
 which would otherwise be prohibited under paragraph (1)(C) shall terminate
 with respect to such activities of such company or subsidiary upon the
 occurrence (after August 10, 1987) of any of the following:
 `(i) The savings and loan holding company acquires control of a bank or an
 additional savings association (other than a savings association acquired
 pursuant to section 13(c) or 13(k) of the Federal Deposit Insurance Act or
 section 406(f) or 408(m) of the National Housing Act).
 `(ii) Any savings association subsidiary of the savings and loan holding
 company fails to qualify as a domestic building and loan association under
 section 7701(a)(19) of the Internal Revenue Code of 1986.
 `(iii) The savings and loan holding company engages in any business activity--
 `(I) which is not described in paragraph (2); and
 `(II) in which it was not engaged on March 5, 1987.
 `(iv) Any savings association subsidiary of the savings and loan holding
 company increases the number of locations from which such savings association
 conducts business after March 5, 1987 (other than an increase which occurs
 in connection with a transaction under section 13(c) or (k) of the Federal
 Deposit Insurance Act or section 408(m) of the National Housing Act.
 `(v) Any savings association subsidiary of the savings and loan holding
 company permits any overdraft (including an intraday overdraft), or incurs
 any such overdraft in its account at a Federal Reserve bank, on behalf of an
 affiliate, unless such overdraft is the result of an inadvertent computer or
 accounting error that is beyond the control of both the savings association
 subsidiary and the affiliate.
 `(D) ORDER BY DIRECTOR TO TERMINATE SUBPARAGRAPH (B) ACTIVITY- Any activity
 described in subparagraph (B) may also be terminated by the Director, after
 opportunity for hearing, if the Director determines, having due regard
 for the purposes of this title, that such action is necessary to prevent
 conflicts of interest or unsound practices or is in the public interest.
 `(7) FOREIGN SAVINGS AND LOAN HOLDING COMPANY- Notwithstanding any other
 provision of this section, any savings and loan holding company organized
 under the laws of a foreign country as of June 1, 1984 (including any
 subsidiary thereof which is not a savings association), which controls a
 single savings association on August 10, 1987, shall not be subject to this
 subsection with respect to any activities of such holding company which
 are conducted exclusively in a foreign country.
 `(8) EXEMPTION FOR BANK HOLDING COMPANIES- Except for paragraph (1)(A),
 this subsection shall not apply to any company that is treated as a bank
 holding company for purposes of section 4 of the Bank Holding Company Act
 of 1956, or any of its subsidiaries.
 `(d) TRANSACTIONS WITH AFFILIATES- Transactions between any subsidiary
 savings association of a savings and loan holding company and any affiliate
 (of such savings association subsidiary) shall be subject to the limitations
 and prohibitions specified in section 11 of this Act.
 `(e) Acquisitions-
 `(1) IN GENERAL- It shall be unlawful for--
 `(A) any savings and loan holding company directly or indirectly, or through
 one or more subsidiaries or through one or more transactions--
 `(i) to acquire, except with the prior written approval of the Director,
 the control of a savings association or a savings and loan holding company,
 or to retain the control of such an association or holding company acquired
 or retained in violation of this section as heretofore or hereafter in effect;
 `(ii) to acquire, except with the prior written approval of the Director,
 by the process of merger, consolidation, or purchase of assets, another
 savings association or a savings and loan holding company, or all or
 substantially all of the assets of any such association or holding company;
 `(iii) to acquire, by purchase or otherwise, or to retain more than 5
 percent of the voting shares of a savings association not a subsidiary, or
 of a savings and loan holding company not a subsidiary, or in the case of a
 multiple savings and loan holding company (other than a company described
 in subsection (c)(8)), to so acquire or retain more than 5 percent of
 the voting shares of any company not a subsidiary which is engaged in
 any business activity other than the activities specified in subsection
 (c)(2). This clause shall not apply to shares of a savings association or
 of a savings and loan holding company--
 `(I) held as a bona fide fiduciary (whether with or without the sole
 discretion to vote such shares);
 `(II) held temporarily pursuant to an underwriting commitment in the normal
 course of an underwriting business;
 `(III) held in an account solely for trading purposes;
 `(IV) over which no control is held other than control of voting rights
 acquired in the normal course of a proxy solicitation;
 `(V) acquired in securing or collecting a debt previously contracted in good
 faith, during the 2-year period beginning on the date of such acquisition or
 for such additional time (not exceeding 3 years) as the Director may permit
 if the Director determines that such an extension will not be detrimental
 to the public interest;
 `(VI) acquired under section 408(m) of the National Housing Act or section
 13(k) of the Federal Deposit Insurance Act;
 `(VII) held by any insurance company, as defined in section 2(a)(17) of
 the Investment Company Act of 1940, except as provided in paragraph (6);
 `(VIII) acquired pursuant to a qualified stock issuance if such purchase
 is approved by the Director under subsection (q)(1)(D);
except that the aggregate amount of shares held under this clause (other than
under subclauses (I), (II), (III), (IV), and (VI)) may not exceed 15 percent
of all outstanding shares or of the voting power of a savings association
or savings and loan holding company; or
 `(iv) to acquire the control of an uninsured institution, or to retain for
 more than one year after February 14, 1968, or from the date on which such
 control was acquired, whichever is later, except that the Director may upon
 application by such company extend such one-year period from year to year,
 for an additional period not exceeding 3 years, if the Director finds such
 extension is warranted and is not detrimental to the public interest;
 `(B) any other company, without the prior written approval of the Director,
 directly or indirectly, or through one or more subsidiaries or through
 one or more transactions, to acquire the control of one or more savings
 associations, except that such approval shall not be required in connection
 with the control of a savings association, (i) acquired by devise under the
 terms of a will creating a trust which is excluded from the definition of
 `savings and loan holding company' under subsection (a) of this section,
 or (ii) acquired in connection with a reorganization in which a person
 or group of persons, having had control of a savings association for more
 than 3 years, vests control of that association in a newly formed holding
 company subject to the control of the same person or group of persons. The
 Director shall approve an acquisition of a savings association under
 this subparagraph unless the Director finds the financial and managerial
 resources and future prospects of the company and association involved to
 be such that the acquisition would be detrimental to the association or the
 insurance risk of the Savings Association Insurance Fund or Bank Insurance
 Fund, and shall render a decision within 90 days after submission to the
 Director of the complete record on the application.
 `(2) FACTORS TO BE CONSIDERED- The Director shall not approve any acquisition
 under subparagraph (A)(i) or (A)(ii), or of more than one savings association
 under subparagraph (B) of paragraph (1) of this subsection, any acquisition
 of stock in connection with a qualified stock issuance, any acquisition
 under paragraph (4)(A), or any transaction under section 13(k) of the
 Federal Deposit Insurance Act, except in accordance with this paragraph. In
 every case, the Director shall take into consideration the financial and
 managerial resources and future prospects of the company and association
 involved, the effect of the acquisition on the association, the insurance
 risk to the Savings Association Insurance Fund or the Bank Insurance Fund,
 and the convenience and needs of the community to be served, and shall
 render a decision within 90 days after submission to the Director of the
 complete record on the application. Before approving any such acquisition,
 except a transaction under section 13(k) of the Federal Deposit Insurance
 Act, the Director shall request from the Attorney General and consider any
 report rendered within 30 days on the competitive factors involved. The
 Director shall not approve any proposed acquisition--
 `(A) which would result in a monopoly, or which would be in furtherance
 of any combination or conspiracy to monopolize or to attempt to monopolize
 the savings and loan business in any part of the United States, or
 `(B) the effect of which in any section of the country may be substantially
 to lessen competition, or tend to create a monopoly, or which in any
 other manner would be in restraint of trade, unless it finds that the
 anticompetitive effects of the proposed acquisition are clearly outweighed
 in the public interest by the probable effect of the acquisition in meeting
 the convenience and needs of the community to be served.
 `(3) INTERSTATE ACQUISITIONS- No acquisition shall be approved by the Director
 under this subsection which will result in the formation by any company,
 through one or more subsidiaries or through one or more transactions, of a
 multiple savings and loan holding company controlling savings associations
 in more than one State, unless--
 `(A) such company, or a savings association subsidiary of such company,
 is authorized to acquire control of a savings association subsidiary,
 or to operate a home or branch office, in the additional State or States
 pursuant to section 13(k) of the Federal Deposit Insurance Act;
 `(B) such company controls a savings association subsidiary which operated
 a home or branch office in the additional State or States as of March 5,
 1987; or
 `(C) the statutes of the State in which the savings association to be
 acquired is located permit a savings association chartered by such State to be
 acquired by a savings association chartered by the State where the acquiring
 savings association or savings and loan holding company is located or by a
 holding company that controls such a State chartered savings association,
 and such statutes specifically authorize such an acquisition by language
 to that effect and not merely by implication.
 `(4) ACQUISITIONS BY CERTAIN INDIVIDUALS-
 `(A) IN GENERAL- Notwithstanding subsection (h)(2), any director or officer
 of a savings and loan holding company, or any individual who owns, controls,
 or holds with power to vote (or holds proxies representing) more than 25
 percent of the voting shares of such holding company, may acquire control
 of any savings association not a subsidiary of such savings and loan holding
 company with the prior written approval of the Director.
 `(B) TREATMENT OF CERTAIN HOLDING COMPANIES- If any individual referred to
 in subparagraph (A) controls more than 1 savings and loan holding company
 or more than 1 savings association, any savings and loan holding company
 controlled by such individual shall be subject to the activities limitations
 contained in subsection (c) to the same extent such limitations apply to
 multiple savings and loan holding companies, unless all or all but 1 of
 the savings associations (including any institution deemed to be a savings
 association under subsection (1) of this section) controlled directly
 or indirectly by such individual was acquired pursuant to an acquisition
 described in subclause (I) or (II) of subsection (c)(3)(B)(i).
 `(5) ACQUISITIONS PURSUANT TO CERTAIN SECURITY INTERESTS- This subsection
 and subsection (c)(2) of this section do not apply to any savings and loan
 holding company which acquired the control of a savings association or of
 a savings and loan holding company pursuant to a pledge or hypothecation
 to secure a loan, or in connection with the liquidation of a loan, made in
 the ordinary course of business. It shall be unlawful for any such company
 to retain such control for more than one year after February 14, 1968,
 or from the date on which such control was acquired, whichever is later,
 except that the Director may upon application by such company extend such
 one-year period from year to year, for an additional period not exceeding
 3 years, if the Director finds such extension is warranted and would not
 be detrimental to the public interest.
 `(6) SHARES HELD BY INSURANCE AFFILIATES- Shares described in clause
 (iii)(VII) of paragraph (1)(A) shall not be excluded for purposes of clause
 (iii) of such paragraph if--
 `(A) all shares held under such clause (iii)(VII) by all insurance company
 affiliates of such savings association or savings and loan holding company
 in the aggregate exceed 5 percent of all outstanding shares or of the voting
 power of the savings association or savings and loan holding company; or
 `(B) such shares are acquired or retained with a view to acquiring,
 exercising, or transferring control of the savings association or savings
 and loan holding company.
 `(f) DECLARATION OF DIVIDEND- Every subsidiary savings association of a
 savings and loan holding company shall give the Director not less than 30
 days' advance notice of the proposed declaration by its directors of any
 dividend on its guaranty, permanent, or other nonwithdrawable stock. Such
 notice period shall commence to run from the date of receipt of such notice
 by the Director. Any such dividend declared within such period, or without
 the giving of such notice to the Director, shall be invalid and shall confer
 no rights or benefits upon the holder of any such stock.
 `(g) Administration and Enforcement-
  `(1) IN GENERAL- The Director is authorized to issue such regulations
  and orders as the Director deems necessary or appropriate to enable the
  Director to administer and carry out the purposes of this section, and to
  require compliance therewith and prevent evasions thereof.
 `(2) INVESTIGATIONS- The Director may make such investigations as the Director
 deems necessary or appropriate to determine whether the provisions of this
 section, and regulations and orders thereunder, are being and have been
 complied with by savings and loan holding companies and subsidiaries and
 affiliates thereof. For the purpose of any investigation under this section,
 the Director may administer oaths and affirmations, issue subpenas, take
 evidence, and require the production of any books, papers, correspondence,
 memorandums, or other records which may be relevant or material to the
 inquiry. The attendance of witnesses and the production of any such records
 may be required from any place in any State. The Director may apply to the
 United States district court for the judicial district (or the United States
 court in any territory) in which any witness or company subpenaed resides
 or carries on business, for enforcement of any subpena issued pursuant to
 this paragraph, and such courts shall have jurisdiction and power to order
 and require compliance.
 `(3) PROCEEDINGS- (A) In any proceeding under subsection (a)(2)(D) or
 under paragraph (5) of this section, the Director may administer oaths and
 affirmations, take or cause to be taken depositions, and issue subpenas. The
 Director may make regulations with respect to any such proceedings. The
 attendance of witnesses and the production of documents provided for in this
 paragraph may be required from any place in any State or in any territory
 at any designated place where such proceeding is being conducted. Any party
 to such proceedings may apply to the United States District Court for the
 District of Columbia, or the United States district court for the judicial
 district or the United States court in any territory in which such proceeding
 is being conducted, or where the witness resides or carries on business,
 for enforcement of any subpena issued pursuant to this paragraph, and such
 courts shall have jurisdiction and power to order and require compliance
 therewith. Witnesses subpenaed under this section shall be paid the same
 fees and mileage that are paid witnesses in the district courts of the
 United States.
 `(B) Any hearing provided for in subsection (a)(2)(D) or under paragraph
 (5) of this section shall be held in the Federal judicial district or in the
 territory in which the principal office of the association or other company
 is located unless the party afforded the hearing consents to another place,
 and shall be conducted in accordance with the provisions of chapter 5 of
 title 5, United States Code.
 `(4) INJUNCTIONS- Whenever it appears to the Director that any person is
 engaged or has engaged or is about to engage in any acts or practices which
 constitute or will constitute a violation of the provisions of this section
 or of any regulation or order thereunder, the Director may bring an action in
 the proper United States district court, or the United States court of any
 territory or other place subject to the jurisdiction of the United States,
 to enjoin such acts or practices, to enforce compliance with this section or
 any regulation or order, or to require the divestiture of any acquisition
 in violation of this section, or for any combination of the foregoing,
 and such courts shall have jurisdiction of such actions. Upon a proper
 showing an injunction, decree, restraining order, order of divestiture,
 or other appropriate order shall be granted without bond.
 `(5) CEASE AND DESIST ORDERS- (A) Notwithstanding any other provision of this
 section, the Director may, whenever the Director has reasonable cause to
 believe that the continuation by a savings and loan holding company of any
 activity or of ownership or control of any of its noninsured subsidiaries
 constitutes a serious risk to the financial safety, soundness, or stability
 of a savings and loan holding company's subsidiary savings association and
 is inconsistent with the sound operation of a savings association or with
 the purposes of this section or section 8 of the Federal Deposit Insurance
 Act, order the savings and loan holding company or any of its subsidiaries,
 after due notice and opportunity for hearing, to terminate such activities
 or to terminate (within 120 days or such longer period as the Director
 directs in unusual circumstances) its ownership or control of any such
 noninsured subsidiary either by sale or by distribution of the shares of the
 subsidiary to the shareholders of the savings and loan holding company. Such
 distribution shall be pro rata with respect to all of the shareholders of the
 distributing savings and loan holding company, and the holding company shall
 not make any charge to its shareholders arising out of such a distribution.
 `(B) The Director may in the Director's discretion apply to the United States
 district court within the jurisdiction of which the principal office of the
 company is located, for the enforcement of any effective and outstanding order
 issued under this section, and such court shall have jurisdiction and power
 to order and require compliance therewith. Except as provided in subsection
 (j), no court shall have jurisdiction to affect by injunction or otherwise
 the issuance or enforcement of any notice or order under this section, or
 to review, modify, suspend, terminate, or set aside any such notice or order.
 `(h) PROHIBITED ACTS- It shall be unlawful for--
 `(1) any savings and loan holding company or subsidiary thereof, or any
 director, officer, employee, or person owning, controlling, or holding with
 power to vote, or holding proxies representing, more than 25 percent of the
 voting shares, of such holding company or subsidiary, to hold, solicit,
 or exercise any proxies in respect of any voting rights in a savings
 association which is a mutual association;
 `(2) any director or officer of a savings and loan holding company, or any
 individual who owns, controls, or holds with power to vote (or holds proxies
 representing) more than 25 percent of the voting shares of such holding
 company, to acquire control of any savings association not a subsidiary of
 such savings and loan holding company, unless such acquisition is approved
 by the Director pursuant to subsection (e)(4); or
 `(3) any individual, except with the prior approval of the Director, to
 serve or act as a director, officer, or trustee of, or become a partner in,
 any savings and loan holding company after having been convicted of any
 criminal offense involving dishonesty or breach of trust.
 `(i) Penalties-
 `(1) CRIMINAL PENALTIES- (A) Whoever knowingly violates any provision of
 this section, and any company which violates any regulation or order issued
 by the Director pursuant thereto, shall be fined not more than $100,000
 per day for each day during which the violation continues.
 `(B) Any individual who knowingly violates any provision of this section
 shall be fined not more than $100,000 per day for each day during which
 the violation continues, imprisoned not more than 1 year, or both.
 `(C) Whoever knowingly violates any provision of this section with intent
 to deceive, to defraud, or to profit significantly shall be fined not more
 than $1,000,000 per day for each day during which the violation continues,
 imprisoned not more than 5 years, or both.
 `(2) FALSE ENTRIES- Every director, officer, partner, trustee, agent,
 or employee of a savings and loan holding company shall be subject to the
 same penalties for false entries in any book, report, or statement of such
 savings and loan holding company as are applicable to officers, agents,
 and employees of a savings association the accounts of which are insured
 by the Corporation for false entries in any books, reports, or statements
 of such association under section 1006 of title 18, United States Code.
 `(3) CIVIL MONEY PENALTY-
 `(A) PENALTY- Any company which violates, and any person who participates in
 a violation of, any provision of this section, or any regulation or order
 issued pursuant thereto, shall forfeit and pay a civil penalty of not more
 than $25,000 for each day during which such violation continues.
 `(B) ASSESSMENT- Any penalty imposed under subparagraph (A) may be assessed
 and collected by the Director in the manner provided in subparagraphs (E),
 (F), (G), and (I) of section 8(i)(2) of the Federal Deposit Insurance Act
 for penalties imposed (under such section) and any such assessment shall
 be subject to the provisions of such section.
 `(C) HEARING- The company or other person against whom any civil penalty is
 assessed under this paragraph shall be afforded a hearing if such company or
 person submits a request for such hearing within 20 days after the issuance
 of the notice of assessment. Section 8(h) of the Federal Deposit Insurance
 Act shall apply to any proceeding under this paragraph.
 `(D) DISBURSEMENT- All penalties collected under authority of this paragraph
 shall be deposited into the Treasury.
 `(E) VIOLATE DEFINED- For purposes of this section, the term `violate'
 includes any action (alone or with another or others) for or toward causing,
 bringing about, participating in, counseling, or aiding or abetting a
 violation.
 `(F) REGULATIONS- The Director shall prescribe regulations establishing
 such procedures as may be necessary to carry out this paragraph.
 `(4) 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 a savings and loan
 holding company or subsidiary thereof (including a separation caused by the
 deregistration of such a company or such a subsidiary) shall not affect the
 jurisdiction and authority of the Director 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 holding company or its subsidiary (whether such
 date occurs before, on, or after the date of the enactment of this paragraph).
 `(j) JUDICIAL REVIEW- Any party aggrieved by an order of the Director under
 this section may obtain a review of such order by filing in the court of
 appeals of the United States for the circuit in which the principal office
 of such party is located, or in the United States Court of Appeals for the
 District of Columbia Circuit, within 30 days after the date of service of
 such order, a written petition praying that the order of the Director be
 modified, terminated, or set aside. A copy of the petition shall be forthwith
 transmitted by the clerk of the court to the Director, and thereupon the
 Director shall file in the court the record in the proceeding, as provided
 in section 2112 of title 28, United States Code. Upon the filing of such
 petition, such court shall have jurisdiction, which upon the filing of
 the record shall be exclusive, to affirm, modify, terminate, or set aside,
 in whole or in part, the order of the Director. Review of such proceedings
 shall be had as provided in chapter 7 of title 5, United States Code. The
 judgment and decree of the court shall be final, except that the same shall
 be subject to review by the Supreme Court upon certiorari as provided in
 section 1254 of title 28, United States Code.
 `(k) SAVINGS CLAUSE- Nothing contained in this section, other than any
 transaction approved under subsection (e)(2) of this section or section
 13 of the Federal Deposit Insurance Act, shall be interpreted or construed
 as approving any act, action, or conduct which is or has been or may be in
 violation of existing law, nor shall anything herein contained constitute a
 defense to any action, suit, or proceeding pending or hereafter instituted
 on account of any act, action, or conduct in violation of the antitrust laws.
 `(l) TREATMENT OF FDIC INSURED STATE SAVINGS BANKS AND COOPERATIVE BANKS
 AS SAVINGS ASSOCIATIONS-
 `(1) IN GENERAL- Notwithstanding any other provision of law, a savings
 bank (as defined in section 3(g) of the Federal Deposit Insurance Act)
 and a cooperative bank that is an insured bank (as defined in section 3(h)
 of the Federal Deposit Insurance Act) upon application shall be deemed to
 be a savings association for the purpose of this section, if the Director
 determines that such bank is a qualified thrift lender (as determined under
 subsection (m)).
 `(2) FAILURE TO MAINTAIN QUALIFIED THRIFT LENDER STATUS- If any savings
 bank which is deemed to be a savings association under paragraph (1)
 subsequently fails to maintain its status as a qualified thrift lender,
 as determined by the Director, such bank may not thereafter be a qualified
 thrift lender for a period of 5 years.
 `(m) QUALIFIED THRIFT LENDER TEST-
 `(1) IN GENERAL- Except as provided in paragraphs (2) and (6), any savings
 association shall have the status of a qualified thrift lender if--
 `(A) the qualified thrift investments of such savings association equal or
 exceed 60 percent of the total tangible assets of such association; and
 `(B) the qualified thrift investments of such savings association continue to
 equal or exceed 60 percent of the total tangible assets of such association
 on an average basis in 3 out of every 4 quarters and 2 out of every 3 years.
 `(2) EXCEPTIONS GRANTED BY DIRECTOR- Notwithstanding paragraph (1), the
 Director may grant such temporary and limited exceptions from the minimum
 actual thrift investment percentage requirement contained in such paragraph
 as the Director deems necessary if--
 `(A) the Director determines that extraordinary circumstances exist, such
 as when the effects of high interest rates reduce mortgage demand to such
 a degree that an insufficient opportunity exists for a savings association
 to meet such investment requirements; or
 `(B) the Director determines that--
 `(i) the grant of any such exception will significantly facilitate an
 acquisition under section 13(c) or 13(k) of the Federal Deposit Insurance Act;
 `(ii) the acquired association will comply with the transition requirements
 of paragraph (6)(B), as if the date of the exemption were the starting date
 for the transition period described in that paragraph; and
 `(iii) the Director determines that the exemption will not have an undue
 adverse effect on competing savings associations in the relevant market
 and will further the purposes of this subsection.
 `(3) Failure to become and remain a qualified thrift lender-
 `(A) IN GENERAL- Except as provided in subparagraph (D), a savings association
 that fails to become or remain a qualified thrift lender shall either become
 one or more banks (other than a savings bank), or be subject to subparagraph
 (B).
 `(B) Restrictions applicable to savings associations that are not qualified
 thrift lenders-
 `(i) RESTRICTIONS EFFECTIVE IMMEDIATELY- The following restrictions shall
 apply immediately to a savings association after the date on which the savings
 association should have become or ceases to be a qualified thrift lender:
 `(I) ACTIVITIES- The savings association shall not make any new investment
 (including an investment in a subsidiary) or engage, directly or indirectly,
 in any other new activity unless that investment or activity would be
 permissible for the savings association if it were a national bank, and is
 also permissible for the savings association as a savings association.
 `(II) BRANCHING- The savings association shall not establish any new branch
 office at any location at which a national bank located in the savings
 association's home State may not establish a branch office. For purposes
 of this subclause, a savings association's home State is the State in which
 the savings association's total deposits were largest on the date on which
 the savings association should have become or ceased to be a qualified
 thrift lender.
 `(III) ADVANCES- The savings association shall not be eligible to obtain
 new advances from any Federal home loan bank.
 `(IV) DIVIDENDS- The savings association shall be subject to all statutes
 and regulations governing the payment of dividends by a national bank in
 the same manner and to the same extent as if the savings association were
 a national bank.
 `(ii) ADDITIONAL RESTRICTIONS EFFECTIVE AFTER THREE YEARS- The following
 additional restrictions shall apply to a savings association beginning 3
 years after the date on which the savings association should have become
 or ceases to be a qualified thrift lender:
 `(I) ACTIVITIES- The savings association shall not retain any investment
 (including an investment in any subsidiary) or engage, directly or indirectly,
 in any activity unless that investment or activity would be permissible for
 the savings association if it were a national bank, and is also permissible
 for the savings association as a savings association.
 `(II) ADVANCES- The savings association shall repay any outstanding
 advances from any Federal home loan bank as promptly as can be prudently
 done consistent with the safe and sound operation of the savings association.
 `(C) HOLDING COMPANY REGULATION- Any company that controls a savings
 association that is subject to any provision of subparagraph (B) shall,
 within one year after the date on which the savings association should
 have become or ceases to be a qualified thrift lender, register as and be
 deemed to be a bank holding company subject to all of the provisions of
 the Bank Holding Company Act of 1956, section 8 of the Federal Deposit
 Insurance Act, and other statutes applicable to bank holding companies,
 in the same manner and to the same extent as if the company were a bank
 holding company and the savings association were a bank, as those terms
 are defined in the Bank Holding Company Act of 1956.
 `(D) REQUALIFICATION- A savings association that should have become or
 ceases to be a qualified thrift lender shall not be subject to subparagraph
 (B) or (C) if the savings association becomes a qualified thrift lender
 by meeting the qualified thrift lender requirement in paragraph (1) on an
 average basis in 3 out of every 4 quarters and 2 out of every 3 years and
 thereafter remains a qualified thrift lender. If the savings association
 (or any savings association that acquired all or substantially all of its
 assets from that savings association) at any time thereafter ceases to be a
 qualified thrift lender, it shall immediately be subject to all provisions
 of subparagraphs (B) and (C) as if all the periods described in subparagraphs
 (B)(ii) and (C) had expired.
 `(E) DEPOSIT INSURANCE ASSESSMENTS- Any bank chartered as a result of the
 requirements of this section shall be obligated until December 31, 1993,
 to pay to the Savings Association Insurance Fund the assessments assessed on
 savings associations under the Federal Deposit Insurance Act. Such association
 shall also be assessed, on the date of its change of status from a Savings
 Association Insurance Fund member, the exit fee and entrance fee provided
 in section 5(d) of the Federal Deposit Insurance Act. Such institution
 shall not be obligated to pay the assessments assessed on banks under the
 Federal Deposit Insurance Act until--
 `(i) December 31, 1993, or
 `(ii) the institution's change of status from a Savings Association Insurance
 fund member to a Bank Insurance Fund member,
whichever is later.
 `(F) SPECIAL RULE- This paragraph shall not apply to savings associations
 headquartered and operating primarily in Puerto Rico or the Virgin Islands.
 `(G) NO CIRCUMVENTION OF EXIT MORATORIUM- Subparagraph (A) of this paragraph
 shall not be construed as permitting any insured depository institution to
 engage in any conversion transaction prohibited under section 5(d) of the
 Federal Deposit Insurance Act.
 `(H) EFFECTIVE DATE- This paragraph shall take effect upon the expiration
 of 1 year after the date of enactment of the Financial Institutions Reform,
 Recovery, and Enforcement Act of 1989.
 `(4) DEFINITIONS- For purposes of this subsection--
 `(A) ACTUAL THRIFT INVESTMENT PERCENTAGE- The term `actual thrift investment
 percentage' means the percentage determined by dividing--
 `(i) the amount of the qualified thrift investments of a savings association,
 by
 `(ii) the total amount of tangible assets of such savings association.
 `(B) QUALIFIED THRIFT INVESTMENTS- The term `qualified thrift investments'
 means, with respect to any savings association, the sum of--
 `(i) the aggregate amount of loans, equity positions, or securities held
 by the savings association (or any subsidiary of such association) which
 are related to domestic residential real estate or manufactured housing;
 `(ii) the value of property used by such association or subsidiary in the
 conduct of the business of such association or subsidiary;
 `(iii) subject to paragraph (5), the liquid assets of the type required to
 be maintained under this Act; and
 `(iv) subject to paragraph (5), 50 percent of the dollar amount of the
 residential mortgage loans originated by such savings association or
 subsidiary and sold within 90 days of origination.
 `(5) LIMITATION ON TREATMENT OF CERTAIN ASSETS AS THRIFT INVESTMENTS-
 The aggregate amount of the assets described in clauses (iii) and (iv) of
 paragraph (4)(B) which may be taken into account in determining the amount
 of the qualified thrift investments of any savings association shall not
 exceed the amount which is equal to 10 percent of the tangible assets of
 such association.
 `(6) TRANSITIONAL RULE FOR CERTAIN SAVINGS ASSOCIATIONS-
 `(A) IN GENERAL- If any Federal savings association in existence as a Federal
 savings association on the date of enactment of the Financial Institutions
 Reform, Recovery, and Enforcement Act of 1989--
 `(i) that was chartered as a savings bank or a cooperative bank under State
 law before October 15, 1982; or
 `(ii) that acquired its principal assets from an association that was
 chartered before October 15, 1982, as a savings bank or a cooperative bank
 under State law,
meets the requirements of subparagraph (B), such savings association shall
be treated as a qualified thrift lender during the 6-year period beginning
on August 10, 1989.
 `(B) SUBPARAGRAPH (B) REQUIREMENTS- A savings association meets the
 requirements of this subparagraph if, in the determination of the Director--
 `(i) the actual thrift investment percentage of such association does not,
 after the date of enactment of the Financial Institutions Reform, Recovery,
 and Enforcement Act of 1989, decrease below the actual thrift investment
 percentage of such association on July 15, 1989; and
 `(ii) the amount by which--
 `(I) the actual thrift investment percentage of such association at the
 end of each period described in the following table, exceeds
 `(II) the actual thrift investment percentage of such association on July
 15, 1989,
is equal to or greater than the applicable percentage (as determined under
the following table) of the amount by which 70 percent exceeds the actual
thrift investment percentage of such association on such date of enactment:
  `For the following
The applicable
  period:
percentage is:
   Prior to July 1, 1991
--25 percent
   July 1, 1991-December 31, 1992
--50 percent
   January 1, 1993-June 30, 1994
--75 percent
   Thereafter
--100 percent
 `(C) For purposes of this paragraph, the actual thrift investment percentage
 of an association on July 15, 1989, shall be determined by applying the
 definition of `actual thrift investment percentage' that takes effect on
 July 1, 1991.
 `(n) TYING RESTRICTIONS- A savings and loan holding company and any of
 its affiliates shall be subject to section 5(q) and regulations prescribed
 under such section, in connection with transactions involving the products
 or services of such company or affiliate and those of an affiliated savings
 association as if such company or affiliate were a savings association.
 `(o) Mutual Holding Companies-
 `(1) IN GENERAL- A savings association operating in mutual form may reorganize
 so as to become a holding company by--
 `(A) chartering an interim savings association, the stock of which is to be
 wholly owned, except as otherwise provided in this section, by the mutual
 association; and
 `(B) transferring the substantial part of its assets and liabilities,
 including all of its insured liabilities, to the interim savings association.
 `(2) DIRECTORS AND CERTAIN ACCOUNT HOLDERS' APPROVAL OF PLAN REQUIRED-
 A reorganization is not authorized under this subsection unless--
 `(A) a plan providing for such reorganization has been approved by a majority
 of the board of directors of the mutual savings association; and
 `(B) in the case of an association in which holders of accounts and obligors
 exercise voting rights, such plan has been submitted to and approved by a
 majority of such individuals at a meeting held at the call of the directors
 in accordance with the procedures prescribed by the association's charter
 and bylaws.
 `(3) Notice to the director; disapproval period-
 `(A) NOTICE REQUIRED- At least 60 days prior to taking any action described
 in paragraph (1), a savings association seeking to establish a mutual
 holding company shall provide written notice to the Director. The notice
 shall contain such relevant information as the Director shall require by
 regulation or by specific request in connection with any particular notice.
 `(B) TRANSACTION ALLOWED IF NOT DISAPPROVED- Unless the Director within such
 60-day notice period disapproves the proposed holding company formation,
 or extends for another 30 days the period during which such disapproval
 may be issued, the savings association providing such notice may proceed
 with the transaction, if the requirements of paragraph (2) have been met.
 `(C) GROUNDS FOR DISAPPROVAL- The Director may disapprove any proposed
 holding company formation only if--
 `(i) such disapproval is necessary to prevent unsafe or unsound practices;
 `(ii) the financial or management resources of the savings association
 involved warrant disapproval;
 `(iii) the savings association fails to furnish the information required
 under subparagraph (A); or
 `(iv) the savings association fails to comply with the requirement of
 paragraph (2).
 `(D) RETENTION OF CAPITAL ASSETS- In connection with the transaction described
 in paragraph (1), a savings association may, subject to the approval of the
 Director, retain capital assets at the holding company level to the extent
 that such capital exceeds the association's capital requirement established
 by the Director pursuant to sections 5 (s) and (t) of this Act.
 `(4) Ownership-
 `(A) IN GENERAL- Persons having ownership rights in the mutual association
 pursuant to section 5(b)(1)(B) of this Act or State law shall have the same
 ownership rights with respect to the mutual holding company.
 `(B) HOLDERS OF CERTAIN ACCOUNTS- Holders of savings, demand or other
 accounts of--
 `(i) a savings association chartered as part of a transaction described in
 paragraph (1); or
 `(ii) a mutual savings association acquired pursuant to paragraph (5)(B),
shall have the same ownership rights with respect to the mutual holding
company as persons described in subparagraph (A) of this paragraph.
 `(5) PERMITTED ACTIVITIES- A mutual holding company may engage only in the
 following activities:
 `(A) Investing in the stock of a savings association.
 `(B) Acquiring a mutual association through the merger of such association
 into a savings association subsidiary of such holding company or an interim
 savings association subsidiary of such holding company.
 `(C) Subject to paragraph (6), merging with or acquiring another holding
 company, one of whose subsidiaries is a savings association.
 `(D) Investing in a corporation the capital stock of which is available
 for purchase by a savings association under Federal law or under the law
 of any State where the subsidiary savings association or associations have
 their home offices.
 `(E) Engaging in the activities described in subsection (c)(2), except
 subparagraph (B).
 `(6) Limitations on certain activities of acquired holding companies-
 `(A) NEW ACTIVITIES- If a mutual holding company acquires or merges with
 another holding company under paragraph (5)(C), the holding company acquired
 or the holding company resulting from such merger or acquisition may only
 invest in assets and engage in activities which are authorized under paragraph
 (5).
 `(B) GRACE PERIOD FOR DIVESTING PROHIBITED ASSETS OR DISCONTINUING PROHIBITED
 ACTIVITIES- Not later than 2 years following a merger or acquisition
 described in paragraph (5)(C), the acquired holding company or the holding
 company resulting from such merger or acquisition shall--
 `(i) dispose of any asset which is an asset in which a mutual holding
 company may not invest under paragraph (5); and
 `(ii) cease any activity which is an activity in which a mutual holding
 company may not engage under paragraph (5).
 `(7) REGULATION- A mutual holding company shall be chartered by the Director
 and shall be subject to such regulations as the Director may prescribe. Unless
 the context otherwise requires, a mutual holding company shall be subject
 to the other requirements of this section regarding regulation of holding
 companies.
 `(8) CAPITAL IMPROVEMENT-
 `(A) PLEDGE OF STOCK OF SAVINGS ASSOCIATION SUBSIDIARY- This section shall
 not prohibit a mutual holding company from pledging all or a portion of the
 stock of a savings association chartered as part of a transaction described
 in paragraph (1) to raise capital for such savings association.
 `(B) ISSUANCE OF NONVOTING SHARES- This section shall not prohibit a savings
 association chartered as part of a transaction described in paragraph (1)
 from issuing any nonvoting shares or less than 50 percent of the voting shares
 of such association to any person other than the mutual holding company.
 `(9) INSOLVENCY AND LIQUIDATION-
 `(A) IN GENERAL- Notwithstanding any provision of law, upon--
 `(i) the default of any savings association--
 `(I) the stock of which is owned by any mutual holding company; and
 `(II) which was chartered in a transaction described in paragraph (1);
 `(ii) the default of a mutual holding company; or
 `(iii) a foreclosure on a pledge by a mutual holding company described in
 paragraph (8)(A),
a trustee shall be appointed receiver of such mutual holding company and
such trustee shall have the authority to liquidate the assets of, and satisfy
the liabilities of, such mutual holding company pursuant to title 11, United
States Code.
 `(B) DISTRIBUTION OF NET PROCEEDS- Except as provided in subparagraph (C),
 the net proceeds of any liquidation of any mutual holding company pursuant
 to subparagraph (A) shall be transferred to persons who hold ownership
 interests in such mutual holding company.
 `(C) RECOVERY BY CORPORATION- If the Corporation incurs a loss as a result
 of the default of any savings association subsidiary of a mutual holding
 company which is liquidated pursuant to subparagraph (A), the Corporation
 shall succeed to the ownership interests of the depositors of such savings
 association in the mutual holding company, to the extent of the Corporation's
 loss.
 `(10) DEFINITIONS- For purposes of this subsection--
 `(A) MUTUAL HOLDING COMPANY- The term `mutual holding company' means a
 corporation organized as a holding company under this subsection.
 `(B) MUTUAL ASSOCIATION- The term `mutual association' means a savings
 association which is operating in mutual form.
 `(C) DEFAULT- The term `default' means an adjudication or other official
 determination of a court of competent jurisdiction or other public authority
 pursuant to which a conservator, receiver, or other legal custodian is
 appointed.
 `(p) HOLDING COMPANY ACTIVITIES CONSTITUTING SERIOUS RISK TO SUBSIDIARY
 SAVINGS ASSOCIATION-
 `(1) DETERMINATION AND IMPOSITION OF RESTRICTIONS- If the Director determines
 that there is reasonable cause to believe that the continuation by a savings
 and loan holding company of any activity constitutes a serious risk to the
 financial safety, soundness, or stability of a savings and loan holding
 company's subsidiary savings association, the Director may impose such
 restrictions as the Director determines to be necessary to address such
 risk. Such restrictions shall be issued in the form of a directive to the
 holding company and any of its subsidiaries, limiting--
 `(A) the payment of dividends by the savings association;
 `(B) transactions between the savings association, the holding company,
 and the subsidiaries or affiliates of either; and
 `(C) any activities of the savings association that might create a serious
 risk that the liabilities of the holding company and its other affiliates
 may be imposed on the savings association.
Such directive shall be effective as a cease and desist order that has
become final.
 `(2) REVIEW OF DIRECTIVE-
 `(A) ADMINISTRATIVE REVIEW- After a directive referred to in paragraph (1)
 is issued, the savings and loan holding company, or any subsidiary of such
 holding company subject to the directive, may object and present in writing
 its reasons why the directive should be modified or rescinded. Unless within
 10 days after receipt of such response the Director affirms, modifies,
 or rescinds the directive, such directive shall automatically lapse.
 `(B) JUDICIAL REVIEW- If the Director affirms or modifies a directive pursuant
 to subparagraph (A), any affected party may immediately thereafter petition
 the United States district court for the district in which the savings and
 loan holding company has its main office or in the United States District
 Court for the District of Columbia to stay, modify, terminate or set aside the
 directive. Upon a showing of extraordinary cause, the savings and loan holding
 company, or any subsidiary of such holding company subject to a directive,
 may petition a United States district court for relief without first pursuing
 or exhausting the administrative remedies set forth in this paragraph.
 `(q) QUALIFIED STOCK ISSUANCE BY UNDERCAPITALIZED SAVINGS ASSOCIATIONS OR
 HOLDING COMPANIES-
 `(1) IN GENERAL- For purposes of this section, any issue of shares of stock
 shall be treated as a qualified stock issuance if the following conditions
 are met:
 `(A) The shares of stock are issued by--
 `(i) an undercapitalized savings association; or
 `(ii) a savings and loan holding company which is not a bank holding company
 but which controls an undercapitalized savings association if, at the time
 of issuance, the savings and loan holding company is legally obligated to
 contribute the net proceeds from the issuance of such stock to the capital
 of an undercapitalized savings association subsidiary of such holding company.
 `(B) All shares of stock issued consist of previously unissued stock or
 treasury shares.
 `(C) All shares of stock issued are purchased by a savings and loan holding
 company that is registered, as of the date of purchase, with the Director
 in accordance with the provisions of subsection (b)(1) of this section.
 `(D) Subject to paragraph (2), the Director approved the purchase of the
 shares of stock by the acquiring savings and loan holding company.
 `(E) The entire consideration for the stock issued is paid in cash by the
 acquiring savings and loan holding company.
 `(F) At the time of the stock issuance, each savings association subsidiary
 of the acquiring savings and loan holding company (other than an association
 acquired in a transaction pursuant to subsection (c) or (k) of section 13 of
 the Federal Deposit Insurance Act or section 408(m) of the National Housing
 Act) has capital (after deducting any subordinated debt, intangible assets,
 and deferred, unamortized gains or losses) of not less than 6 1/2  percent
 of the total assets of such savings association.
 `(G) Immediately after the stock issuance, the acquiring savings and loan
 holding company holds not more than 15 percent of the outstanding voting
 stock of the issuing undercapitalized savings association or savings and
 loan holding company.
 `(H) Not more than one of the directors of the issuing association or company
 is an officer, director, employee, or other representative of the acquiring
 company or any of its affiliates.
 `(I) Transactions between the savings association or savings and loan holding
 company that issues the shares pursuant to this section and the acquiring
 company and any of its affiliates shall be subject to the provisions of
 section 11.
 `(2) APPROVAL OF ACQUISITIONS-
 `(A) ADDITIONAL CAPITAL COMMITMENTS NOT REQUIRED- The Director shall not
 disapprove any application for the purchase of stock in connection with
 a qualified stock issuance on the grounds that the acquiring savings and
 loan holding company has failed to undertake to make subsequent additional
 capital contributions to maintain the capital of the undercapitalized savings
 association at or above the minimum level required by the Director or any
 other Federal agency having jurisdiction.
 `(B) OTHER CONDITIONS- Notwithstanding subsection (a)(4), the Director may
 impose such conditions on any approval of an application for the purchase
 of stock in connection with a qualified stock issuance as the Director
 determines to be appropriate, including--
 `(i) a requirement that any savings association subsidiary of the acquiring
 savings and loan holding company limit dividends paid to such holding
 company for such period of time as the Director may require; and
 `(ii) such other conditions as the Director deems necessary or appropriate
 to prevent evasions of this section.
 `(C) APPLICATION DEEMED APPROVED IF NOT DISAPPROVED WITHIN 90 DAYS-
 An application for approval of a purchase of stock in connection with
 a qualified stock issuance shall be deemed to have been approved by the
 Director if such application has not been disapproved by the Director before
 the end of the 90-day period beginning on the date such application has
 been deemed sufficient under regulations issued by the Director.
 `(3) NO LIMITATION ON CLASS OF STOCK ISSUED- The shares of stock issued in
 connection with a qualified stock issuance may be shares of any class.
 `(4) UNDERCAPITALIZED SAVINGS ASSOCIATION DEFINED- For purposes of this
 subsection, the term `undercapitalized savings association' means any
 savings association--
 `(A) the assets of which exceed the liabilities of such association; and
 `(B) which does not comply with one or more of the capital standards in
 effect under section 5(t).
 `(r) PENALTY FOR FAILURE TO PROVIDE TIMELY AND ACCURATE REPORTS-
 `(1) FIRST TIER- Any savings and loan holding company, and any subsidiary
 of such holding company, which--
 `(A) maintains procedures reasonably adapted to avoid any inadvertent and
 unintentional error and, as a result of such an error--
 `(i) fails to submit or publish any report or information required under
 this section or regulations prescribed by the Director, within the period
 of time specified by the Director; or
 `(ii) submits or publishes any false or misleading report or information; or
 `(B) inadvertently transmits or publishes any report which is minimally late,
shall be subject to a penalty of not more than $2,000 for each day during
which such failure continues or such false or misleading information is
not corrected. Such holding company or subsidiary shall have the burden of
proving by a preponderence of the evidence that an error was inadvertent and
unintentional and that a report was inadvertently transmitted or published
late.
 `(2) SECOND TIER- Any savings and loan holding company, and any subsidiary
 of such holding company, which--
 `(A) fails to submit or publish any report or information required under
 this section or under regulations prescribed by the Director, within the
 period of time specified by the Director; or
 `(B) submits or publishes any false or misleading report or information,
in a manner not described in paragraph (1) shall be subject to a penalty of
not more than $20,000 for each day during which such failure continues or
such false or misleading information is not corrected.
 `(3) THIRD TIER- If any savings and loan holding company or any subsidiary
 of such a holding company knowingly or with reckless disregard for the
 accuracy of any information or report described in paragraph (2) submits or
 publishes any false or misleading report or information, the Director may
 assess a penalty of not more than $1,000,000 or 1 percent of total assets of
 such company or subsidiary, whichever is less, per day for each day during
 which such failure continues or such false or misleading information is
 not corrected.
 `(4) ASSESSMENT- Any penalty imposed under paragraph (1), (2), or (3)
 shall be assessed and collected by the Director in the manner provided
 in subparagraphs (E), (F), (G), and (I) of section 8(i)(2) of the Federal
 Deposit Insurance Act (for penalties imposed under such section) and any
 such assessment (including the determination of the amount of the penalty)
 shall be subject to the provisions of such subsection.
 `(5) HEARING- Any savings and loan holding company or any subsidiary of such a
 holding company against which any penalty is assessed under this subsection
 shall be afforded a hearing if such savings and loan holding company or
 such subsidiary, as the case may be, submits a request for such hearing
 within 20 days after the issuance of the notice of assessment. Section 8(h)
 of the Federal Deposit Insurance Act shall apply to any proceeding under
 this subsection.
`SEC. 11. TRANSACTIONS WITH AFFILIATES; EXTENSIONS OF CREDIT TO EXECUTIVE
OFFICERS, DIRECTORS, AND PRINCIPAL SHAREHOLDERS.
 `(a) Affiliate Transactions-
 `(1) IN GENERAL- Sections 23A and 23B of the Federal Reserve Act shall apply
 to every savings association in the same manner and to the same extent as
 if the savings association were a member bank (as defined in such Act),
 except that--
 `(A) no loan or other extension of credit may be made to any affiliate
 unless that affiliate is engaged only in activities described in section
 10(c)(2)(F)(i); and
 `(B) no savings association may enter into any transaction described in
 section 23A(b)(7)(B) of the Federal Reserve Act with any affiliate other
 than with respect to shares of a subsidiary.
 `(2) Sister bank exemption made available to savings associations-
 `(A) SAVINGS ASSOCIATIONS CONTROLLED BY BANK HOLDING COMPANIES- Every savings
 association more than 80 percent of the voting stock of which is owned by a
 company described in section 10(c)(8) shall be treated as a member bank for
 purposes of section 23A(d)(1) and section 23B of the Federal Reserve Act,
 if every savings association and bank controlled by such company complies
 with all applicable capital requirements on a fully phased-in basis and
 without reliance on goodwill.
 `(B) SAVINGS ASSOCIATIONS GENERALLY- Effective on and after January 1, 1995,
 every savings association shall be treated as a member bank for purposes
 of section 23A(d)(1) and section 23B of the Federal Reserve Act.
 `(3) AFFILIATES DESCRIBED- Any company that would be an affiliate (as
 defined in sections 23A and 23B of the Federal Reserve Act) of any savings
 association if such savings association were a member bank (as such term
 is defined in such Act) shall be deemed to be an affiliate of such savings
 association for purposes of paragraph (1).
 `(4) ADDITIONAL RESTRICTIONS AUTHORIZED- The Director may impose such
 additional restrictions on any transaction between any savings association
 and any affiliate of such savings association as the Director determines to
 be necessary to protect the safety and soundness of the savings association.
 `(b) Extensions of Credit to Executive Officers, Directors, and Principal
 Shareholders-
 `(1) IN GENERAL- Section 22(h) of the Federal Reserve Act shall apply to
 every savings association in the same manner and to the same extent as if
 the savings association were a member bank (as defined in such Act).
 `(2) ADDITIONAL RESTRICTIONS AUTHORIZED- The Director may impose such
 additional restrictions on loans or extensions of credit to any director or
 executive officer of any savings association, or any person who directly or
 indirectly owns, controls, or has the power to vote more than 10 percent of
 any class of voting securities of a savings association, as the Director
 determines to be necessary to protect the safety and soundness of the
 savings association.
 `(c) ADMINISTRATIVE ENFORCEMENT- The Director may take enforcement action
 with respect to violations of this section pursuant to section 8 or 18(j)
 of the Federal Deposit Insurance Act, as appropriate.
`SEC. 12. ADVERTISING.
 `No savings association shall carry on any sale, plan, or practices, or
 any advertising, in violation of regulations promulgated by the Director.
`SEC. 13. POWERS OF EXAMINERS.
 `For the purposes of this Act, examiners appointed by the Director shall--
 `(1) be subject to the same requirements, responsibilities, and penalties
 as are applicable to examiners under the Federal Reserve Act and title LXII
 of the Revised Statutes; and
 `(2) have, in the exercise of functions under this Act, the same powers
 and privileges as are vested in such examiners by law.
`SEC. 14. SEPARABILITY PROVISION.
 `If any provision of this Act, or the application thereof to any person or
 circumstances, is held invalid, the remainder of the Act, and the application
 of such provision to other persons or circumstances, shall not be affected
 thereby.'.
SEC. 302. SAVINGS PROVISIONS.
 Notwithstanding the amendment made by this title to section 10 of the Home
 Owners' Loan Act and the repeal of section 416 of the National Housing Act--
 (1) any plan approved by the Federal Home Loan Bank Board under such section
 10 for any Federal savings association shall continue in effect as long as
 such association adheres to the plan and continues to submit to the Director
 of the Office of Thrift Supervision regular and complete reports on the
 association's progress in meeting the association's goals under the plan; and
 (2) any plan approved by the Federal Savings and Loan Insurance Corporation
 under such section 416 for any State savings association shall continue in
 effect as long as such association adheres to the plan and continues to
 submit to the Federal Deposit Insurance Corporation regular and complete
 reports on the association's progress in meeting the savings association's
 goals under the plan.
SEC. 303. QUALIFIED THRIFT LENDER TEST.
 (a) IN GENERAL- Section 10(m) of the Home Owners' Loan Act is amended to
 read as follows:
 `(m) QUALIFIED THRIFT LENDER TEST-
 `(1) IN GENERAL- Except as provided in paragraphs (2) and (7), any savings
 association is a qualified thrift lender if--
 `(A) the savings association's qualified thrift investments equal or exceed
 70 percent of the savings association's portfolio assets; and
 `(B) the savings association's qualified thrift investments continue to
 equal or exceed 70 percent of the savings association's portfolio assets,
 as measured by a daily or weekly average of such qualified thrift investments
 and such portfolio assets, for the 2-year period beginning on July 1, 1991,
 and for each 2-year period thereafter.
 `(2) EXCEPTIONS GRANTED BY DIRECTOR- Notwithstanding paragraph (1), the
 Director may grant such temporary and limited exceptions from the minimum
 actual thrift investment percentage requirement contained in such paragraph
 as the Director deems necessary if--
 `(A) the Director determines that extraordinary circumstances exist, such
 as when the effects of high interest rates reduce mortgage demand to such
 a degree that an insufficient opportunity exists for a savings association
 to meet such investment requirements; or
 `(B) the Director determines that--
 `(i) the grant of any such exception will significantly facilitate an
 acquisition under section 13(c) or 13(k) of the Federal Deposit Insurance Act;
 `(ii) the acquired association will comply with the transition requirements
 of paragraph (7)(B), as if the date of the exemption were the starting date
 for the transition period described in that paragraph; and
 `(iii) the Director determines that the exemption will not have an undue
 adverse effect on competing savings associations in the relevant market
 and will further the purposes of this subsection.
 `(3) Failure to become and remain a qualified thrift lender-
 `(A) IN GENERAL- A savings association that fails to become or remain a
 qualified thrift lender shall either become one or more banks (other than
 a savings bank) or be subject to subparagraph (B), except as provided in
 subparagraph (D).
 `(B) Restrictions applicable to savings associations that are not qualified
 thrift lenders-
 `(i) RESTRICTIONS EFFECTIVE IMMEDIATELY- The following restrictions shall
 apply to a savings association beginning on the date on which the savings
 association should have become or ceases to be a qualified thrift lender:
 `(I) ACTIVITIES- The savings association shall not make any new investment
 (including an investment in a subsidiary) or engage, directly or indirectly,
 in any other new activity unless that investment or activity would be
 permissible for the savings association if it were a national bank, and is
 also permissible for the savings association as a savings association.
 `(II) BRANCHING- The savings association shall not establish any new branch
 office at any location at which a national bank located in the savings
 association's home State may not establish a branch office. For purposes
 of this subclause, a savings association's home State is the State in which
 the savings association's total deposits were largest on the date on which
 the savings association should have become or ceased to be a qualified
 thrift lender.
 `(III) ADVANCES- The savings association shall not be eligible to obtain
 new advances from any Federal home loan bank.
 `(IV) DIVIDENDS- The savings association shall be subject to all statutes
 and regulations governing the payment of dividends by a national bank in
 the same manner and to the same extent as if the savings association were
 a national bank.
 `(ii) ADDITIONAL RESTRICTIONS EFFECTIVE AFTER THREE YEARS- The following
 additional restrictions shall apply to a savings association beginning 3
 years after the date on which the savings association should have become
 or ceases to be a qualified thrift lender:
 `(I) ACTIVITIES- The savings association shall not retain any investment
 (including an investment in any subsidiary) or engage, directly or indirectly,
 in any activity unless that investment or activity would be permissible for
 the savings association if it were a national bank, and is also permissible
 for the savings association as a savings association.
 `(II) ADVANCES- The savings association shall repay any outstanding
 advances from any Federal home loan bank as promptly as can be prudently
 done consistent with the safe and sound operation of the savings association.
 `(C) HOLDING COMPANY REGULATION- Any company that controls a savings
 association that is subject to any provision of subparagraph (B) shall,
 within one year after the date on which the savings association should
 have become or ceases to be a qualified thrift lender, register as and be
 deemed to be a bank holding company subject to all of the provisions of
 the Bank Holding Company Act of 1956, section 8 of the Federal Deposit
 Insurance Act, and other statutes applicable to bank holding companies,
 in the same manner and to the same extent as if the company were a bank
 holding company and the savings association were a bank, as those terms
 are defined in the Bank Holding Company Act of 1956.
 `(D) REQUALIFICATION- A savings association that should have become or
 ceases to be a qualified thrift lender shall not be subject to subparagraph
 (B) or (C) if the savings association becomes a qualified thrift lender
 by meeting the qualified thrift lender requirement in paragraph (1) for
 the preceding 2-year period and remains a qualified thrift lender. If
 the savings association (or any savings association that acquired all or
 substantially all of its assets from that savings association) at any time
 thereafter ceases to be a qualified thrift lender, it shall immediately
 be subject to all provisions of subparagraphs (B) and (C) as if all the
 periods described in subparagraphs (B)(ii) and (C) had expired.
 `(E) DEPOSIT INSURANCE ASSESSMENTS- Any bank chartered as a result of the
 requirements of this section shall be obligated until December 31, 1993,
 to pay to the Savings Association Insurance Fund the assessments assessed on
 savings associations under the Federal Deposit Insurance Act. Such association
 shall also be assessed, on the date of its change of status from a Savings
 Association Insurance Fund member, the exit fee and entrance fee provided
 in section 5(d) of the Federal Deposit Insurance Act. Such institution
 shall not be obligated to pay the assessments assessed on banks under the
 Federal Deposit Insurance Act until--
 `(i) December 31, 1993, or
 `(ii) the institution's change of status from a Savings Association Insurance
 Fund member to a Bank Insurance Fund member,
whichever is later.
 `(F) EXEMPTION FOR SPECIALIZED SAVINGS ASSOCIATION SERVING TRANSIENT
 MILITARY PERSONNEL- Subparagraph (A) shall not apply to a savings association
 subsidiary of a savings and loan holding company if--
 `(i) the savings and loan holding company is a reciprocal interinsurance
 exchange that acquired control of the insured institution before January 1,
 1984; and
 `(ii) at least 90 percent of the customers of the savings and loan holding
 company and its subsidiaries and affiliates are active or former officers
 in the United States military services or the widows, widowers, divorced
 spouses, or current or former dependents of such officers.
 `(G) EXEMPTION FOR CERTAIN FEDERAL SAVINGS ASSOCIATIONS- This paragraph
 shall not apply to any Federal savings association in existence as a Federal
 savings association on the date of enactment of the Financial Institutions
 Reform, Recovery, and Enforcement Act of 1989--
 `(i) that was chartered before October 15, 1982, as a savings bank or a
 cooperative bank under State law; or
 `(ii) that acquired its principal assets from an association that was
 chartered before October 15, 1982, as a savings bank or a cooperative bank
 under State law.
 `(H) NO CIRCUMVENTION OF EXIT MORATORIUM- Subparagraph (A) of this paragraph
 shall not be construed as permitting any insured depository institution to
 engage in any conversion transaction prohibited under section 5(d) of the
 Federal Deposit Insurance Act.
 `(4) DEFINITIONS- For purposes of this subsection--
 `(A) ACTUAL THRIFT INVESTMENT PERCENTAGE- The term `actual thrift investment
 percentage' means the percentage determined by dividing--
 `(i) the amount of a savings association's qualified thrift investments, by
 `(ii) the amount of the savings association's portfolio assets.
 `(B) PORTFOLIO ASSETS- The term `portfolio assets' means, with respect
 to any savings association, the total assets of the savings association,
 minus the sum of--
 `(i) goodwill and other intangible assets;
 `(ii) the value of property used by the savings association to conduct its
 business; and
 `(iii) liquid assets of the type required to be maintained under section 6
 of the Home Owners' Loan Act, in an amount not exceeding the amount equal
 to 10 percent of the savings association's total assets.
 `(C) QUALIFIED THRIFT INVESTMENTS-
 `(i) IN GENERAL- The term `qualified thrift investments' means, with respect
 to any savings association, the assets of the savings association that are
 described in clauses (ii) and (iii).
 `(ii) ASSETS INCLUDIBLE WITHOUT LIMIT- The following assets are described
 in this clause for purposes of clause (i):
 `(I) The aggregate amount of loans held by the savings association that
 were made to purchase, refinance, construct, improve, or repair domestic
 residential housing or manufactured housing.
 `(II) Home-equity loans.
 `(III) Securities backed by or representing an interest in mortgages on
 domestic residential housing or manufactured housing.
 `(IV) EXISTING OBLIGATIONS OF DEPOSIT INSURANCE AGENCIES- Direct or indirect
 obligations of the Federal Deposit Insurance Corporation or the Federal
 Savings and Loan Insurance Corporation issued in accordance with the terms
 of agreements entered into prior to July 1, 1989, for the 10-year period
 beginning on the date of issuance of such obligations.
 `(V) NEW OBLIGATIONS OF DEPOSIT INSURANCE AGENCIES- Obligations of the
 Federal Deposit Insurance Corporation, the Federal Savings and Loan Insurance
 Corporation, the FSLIC Resolution Fund, and the Resolution Trust Corporation
 issued in accordance with the terms of agreements entered into on or after
 July 1, 1989, for the 5-year period beginning on the date of issuance of
 such obligations.
 `(iii) ASSETS INCLUDIBLE SUBJECT TO PERCENTAGE RESTRICTION- The following
 assets are described in this clause for purposes of clause (i):
 `(I) 50 percent of the dollar amount of the residential mortgage loans
 originated by such savings association and sold within 90 days of origination.
 `(II) Investments in the capital stock or obligations of, and any other
 security issued by, any service corporation if such service corporation
 derives at least 80 percent of its annual gross revenues from activities
 directly related to purchasing, refinancing, constructing, improving,
 or repairing domestic residential real estate or manufactured housing.
 `(III) 200 percent of the dollar amount of loans and investments made to
 acquire, develop, and construct 1- to 4-family residences the purchase price
 of which is or is guaranteed to be not greater than 60 percent of the median
 value of comparable newly constructed 1- to 4-family residences within the
 local community in which such real estate is located, except that not more
 than 25 percent of the amount included under this subclause may consist of
 commercial properties related to the development if those properties are
 directly related to providing services to residents of the development.
 `(IV) 200 percent of the dollar amount of loans for the acquisition
 or improvement of residential real property, churches, schools, and
 nursing homes located within, and loans for any other purpose to any small
 businesses located within any area which has been identified by the Director,
 in connection with any review or examination of community reinvestment
 practices, as a geographic area or neighborhood in which the credit needs
 of the low- and moderate-income residents of such area or neighborhood are
 not being adequately met.
 `(V) Loans for the purchase or construction of churches, schools, nursing
 homes, and hospitals, other than those qualifying under clause (IV), and
 loans for the improvement and upkeep of such properties.
 `(VI) Loans for personal, family, household, or educational purposes,
 but the dollar amount treated as qualified thrift investments under this
 subclause may not exceed the amount which is equal to 5 percent of the
 savings association's portfolio assets.
 `(iv) PERCENTAGE RESTRICTION APPLICABLE TO CERTAIN ASSETS- The aggregate
 amount of the assets described in clause (iii) which may be taken into
 account in determining the amount of the qualified thrift investments of
 any savings association shall not exceed the amount which is equal to 15
 percent of a savings association's portfolio assets.
 `(v) The term `qualified thrift investments' excludes--
 `(I) except for home equity loans, that portion of any loan or investment
 that is used for any purpose other than those expressly qualifying under
 any subparagraph of clause (ii) or (iii); or
 `(II) goodwill or any other intangible asset.
 `(5) CONSISTENT ACCOUNTING REQUIRED-
 `(A) In determining the amount of a savings association's portfolio assets,
 the assets of any subsidiary of the savings association shall be consolidated
 with the assets of the savings association if--
 `(i) Assets of the subsidiary are consolidated with the assets of the
 savings association in determining the savings association's qualified
 thrift investments; or
 `(ii) Residential mortgage loans originated by the subsidiary are included
 pursuant to paragraph (4)(C)(iii)(I) in determining the savings association's
 qualified thrift investments.
 `(B) In determining the amount of a savings association's portfolio assets
 and qualified thrift investments, consistent accounting principles shall
 be applied.
 `(6) Special rules for puerto rico and virgin islands savings associations-
 `(A) PUERTO RICO SAVINGS ASSOCIATIONS- With respect to any savings association
 headquartered and operating primarily in Puerto Rico--
 `(i) the term `qualified thrift investments' includes, in addition to the
 items specified in paragraph (4)--
 `(I) the aggregate amount of loans for personal, family, educational, or
 household purposes made to persons residing or domiciled in the Commonwealth
 of Puerto Rico; and
 `(II) the aggregate amount of loans for the acquisition or improvement
 of churches, schools, or nursing homes, and of loans to small businesses,
 located within the Commonwealth of Puerto Rico; and
 `(ii) the aggregate amount of loans related to the purchase, acquisition,
 development and construction of 1- to 4-family residential real estate--
 `(I) which is located within the Commonwealth of Puerto Rico; and
 `(II) the value of which (at the time of acquisition or upon completion
 of the development and construction) is below the median value of newly
 constructed 1- to 4-family residences in the Commonwealth of Puerto Rico,
 which may be taken into account in determining the amount of the qualified
 thrift investments and of such savings association shall be doubled.
 `(B) VIRGIN ISLANDS SAVINGS ASSOCIATIONS- With respect to any savings
 association headquartered and operating primarily in the Virgin Islands--
 `(i) the term `qualified thrift investments' includes, in addition to the
 items specified in paragraph (4)--
 `(I) the aggregate amount of loans for personal, family, educational,
 or household purposes made to persons residing or domiciled in the Virgin
 Islands; and
 `(II) the aggregate amount of loans for the acquisition or improvement
 of churches, schools, or nursing homes, and of loans to small businesses,
 located within the Virgin Islands; and
 `(ii) the aggregate amount of loans related to the purchase, acquisition,
 development and construction of 1- to 4-family residential real estate--
 `(I) which is located within the Virgin Islands; and
 `(II) the value of which (at the time of acquisition or upon completion
 of the development and construction) is below the median value of newly
 constructed 1- to 4-family residences in the Virgin Islands, which may
 be taken into account in determining the amount of the qualified thrift
 investments and of such savings association shall be doubled.
 `(7) TRANSITIONAL RULE FOR CERTAIN SAVINGS ASSOCIATIONS-
 `(A) IN GENERAL- If any Federal savings association in existence as a Federal
 savings association on the date of enactment of the Financial Institutions
 Reform, Recovery, and Enforcement Act of 1989--
 `(i) that was chartered as a savings bank or a cooperative bank under State
 law before October 15, 1982; or
 `(ii) that acquired its principal assets from an association that was
 chartered before October 15, 1982, as a savings bank or a cooperative bank
 under State law,
meets the requirements of subparagraph (B), such savings association shall
be treated as a qualified thrift lender during period ending on September
30, 1995.
 `(B) SUBPARAGRAPH (B) REQUIREMENTS- A savings association meets the
 requirements of this subparagraph if, in the determination of the Director--
 `(i) the actual thrift investment percentage of such association does not,
 after the date of enactment of the Financial Institutions Reform, Recovery,
 and Enforcement Act of 1989, decrease below the actual thrift investment
 percentage of such association on July 15, 1989; and
 `(ii) the amount by which--
 `(I) the actual thrift investment percentage of such association at the
 end of each period described in the following table, exceeds
 `(II) the actual thrift investment percentage of such association on July
 15, 1989,
is equal to or greater than the applicable percentage (as determined under
the following table) of the amount by which 70 percent exceeds the actual
thrift investment percentage of such association on such date of enactment:
  `For the following
--The applicable
  period:
--percentage is:
July 1, 1991-September 30, 1992
--25 percent
October 1, 1992-March 31, 1994
--50 percent
April 1, 1994-September 30, 1995
--75 percent
Thereafter
--100 percent
 `(C) For purposes of this paragraph, the actual thrift investment percentage
 of an association on July 15, 1989, shall be determined by applying the
 definition of `actual thrift investment percentage' that takes effect on
 July 1, 1991.'.
 (b) EFFECTIVE DATE- The amendment made by subsection (a) shall take effect
 on July 1, 1991.
 (c) ASSOCIATIONS THAT HAVE PREVIOUSLY FAILED TO REMAIN QUALIFIED THRIFT
 LENDERS- If, as of June 30, 1991, any savings association is subject to any
 provision of section 10(m)(3) of the Home Owners' Loan Act as in effect
 on that date, the amendment to this subsection made by section 303 of
 the Financial Institutions Reform, Recovery, and Enforcement Act of 1989,
 shall not be construed as reducing the period specified in section 10(m)(3)
 of such Act.
SEC. 304. TRANSITIONAL RULE FOR CERTAIN TRANSACTIONS WITH AFFILIATES.
 (a) CONSISTENCY OF CERTAIN REGULATIONS WITH SECTION 23A OF THE FEDERAL
 RESERVE ACT- Not later than 6 months after the date of enactment of this
 Act, the Director of the Office of Thrift Supervision shall revise the
 Director's conflicts regulations so as not to prohibit a thrift institution
 from purchasing mortgages from a mortgage-banking affiliate to the same
 extent as a member bank may do so under section 250.250 of title 12, Code
 of Federal Regulations.
 (b) TRANSITIONAL PERIOD- Notwithstanding section 11(a) of the Home Owners'
 Loan Act (as added by section 301 of this Act), a thrift institution that,
 before May 1, 1989, had received approval from the Federal Savings and
 Loan Insurance Corporation pursuant to section 408(d)(6) of the National
 Housing Act as then in effect to purchase mortgages from a mortgage-banking
 affiliate may, during the 6-month period following the date on which
 final regulations are prescribed pursuant to subsection (a), continue to
 engage in transactions for which it had received such approval. Any savings
 association that engages in such transactions pursuant to this subsection
 shall comply with the standards that were applicable under section 408(d)(6)
 as in effect on May 1, 1989.
 (c) AUTHORITY TO EXTEND REGULATORY APPROVALS THAT WOULD OTHERWISE LAPSE
 DURING THE TRANSITIONAL PERIOD- The Director of the Office of Thrift
 Supervision may extend until the expiration of the 6-month period described
 in subsection (b) any approval granted by the Federal Savings and Loan
 Insurance Corporation that expires or would expire before the expiration
 of that 6-month period. In determining whether to grant such exemptions,
 the Director shall apply the standards that were applicable under section
 408(d)(6) of the National Housing Act as in effect on May 1, 1989.
SEC. 305. TRANSITIONAL RULES REGARDING CERTAIN LOANS AND EFFECTIVE DATES.
 (a) DIVESTITURE OF CERTAIN LOANS AND INVESTMENTS NOT REQUIRED- The limitations
 on loans and investments contained in section 5(c) of the Home Owners' Loan
 Act, as amended by section 301, do not require the divestiture of any loan or
 investment that was lawful when made under the provisions of such section as
 those provisions were in effect at the time such loan or investment was made.
 (b) LOANS SECURED BY NONRESIDENTIAL REAL PROPERTY-
 (1) IN GENERAL- The Director of the Office of Thrift Supervision may,
 by order, permit a Federal savings association to exceed the limitation
 set forth in section 5(c)(2)(B)(i) of the Home Owners' Loan Act during the
 period beginning on the date of enactment of this Act and ending on June 1,
 1991, if the Director determines that--
 (A) there is a reasonable prospect that the savings association can be
 in compliance, not later than June 1, 1991, with the capital standards
 prescribed under section 5(t) of the Home Owners' Loan Act; and
 (B) the increased authority--
 (i) is consistent with prudent operating practices, and
 (ii) is in accordance with a plan submitted by the savings association for--
 (I) an orderly transition to compliance with section 5(c)(2)(B)(i), or
 (II) an orderly conversion to a bank charter.
 (2) OTHER EXEMPTIVE AUTHORITY NOT AFFECTED- The authority granted by
 paragraph (1) is in addition to any authority of the Director under section
 5(c)(2)(B)(ii) of the Home Owners' Loan Act.
 (c) EFFECTIVE DATE- The amendments made by section 301 relating to civil
 penalties shall apply with respect to violations committed and activities
 engaged in after the date of the enactment of this Act, except that the
 increased maximum civil penalties of $5,000 and $25,000 per violation or per
 day may apply to such violations or activities committed or engaged in before
 such date with respect to an institution if such violations or activities--
 (1) are not already subject to a notice issued by the appropriate Federal
 banking agency or the Board (initiating an administrative proceeding); and
 (2) occurred after the completion of the last report of examination of
 the institution by the appropriate Federal banking agency (as defined in
 section 3 of the Federal Deposit Insurance Act) occurring before the date
 of the enactment of this Act.
SEC. 306. AMENDMENT OF ADDITIONAL POWERS OF DIRECTOR.
 (a) Section 502(c) of the Housing Act of 1948 (12 U.S.C. 1701c(c)) is
 amended by striking out `Federal Home Loan Bank Board (which term as used in
 this section shall also include and refer to the Federal Savings and Loan
 Insurance Corporation, the Home Owners Loan Corporation, and the Chairman
 of the Federal Home Loan Bank Board),' and inserting in lieu thereof the
 following: `Director of the Office of Thrift Supervision,'.
 (b) Section 502(c)(1) of the Housing Act of 1948 (12 U.S.C. 1701c(b)(1))
 is amended by striking out `of any State' and inserting in lieu thereof
 `of any Federal, State,'.
SEC. 307. AMENDMENT TO TITLE 31, UNITED STATES CODE.
 (a) OFFICE ESTABLISHED AS AN OFFICE WITHIN THE DEPARTMENT-
 (1) IN GENERAL- Subchapter I of chapter 3 of title 31, United States Code,
 is amended by redesignating section 309 as section 310 and by inserting
 after section 308 the following new section:
`Sec. 309. Office of Thrift Supervision
 `The Office of Thrift Supervision established under section 2A(a) of the
 Home Owners' Loan Act shall be an office in the Department of the Treasury.'.
 (2) CLERICAL AMENDMENT- The table of chapters for subchapter I of chapter
 3 of title 31, United States Code, is amended by redesignating the item
 relating to section 309 as section 310 and by inserting after the item
 relating to section 308 the following new item:
`309. Office of Thrift Supervision.'.
 (b) CONFORMING AMENDMENT- Section 321(c) of title 31, United States Code,
 is amended--
 (1) by adding at the end thereof the following new paragraph:
 `(3) of the Director of the Office of Thrift Supervision;';
 (2) by striking out `and' at the end of paragraph (1); and
 (3) by striking out the period at the end of paragraph (2) and inserting
 in lieu thereof `; and'.
 (c) GAO AUDIT AUTHORITY- Section 714(a) of title 31, United States Code,
 is amended--
 (1) by inserting `, and the Office of Thrift Supervision' before the
 period; and
 (2) by striking out `and' after `Corporation,'.
 (d) CERTAIN REORGANIZATION PROHIBITED- Section 321 of title 31, United States
 Code, is amended by adding at the end thereof the following new subsection:
 `(e) CERTAIN REORGANIZATION PROHIBITED- The Secretary of the Treasury may
 not merge or consolidate the Office of Thrift Supervision, or any of the
 functions or responsibilities of the Office or the Director of such office,
 with the Office of the Comptroller of the Currency or the Comptroller of
 the Currency.'.
 (e) TECHNICAL AND CONFORMING AMENDMENT TO GOVERNMENT CONTROL ACT- Section
 9101(3) of title 31, United States Code, is amended by striking out
 subparagraph (E).
SEC. 308. PRESERVING MINORITY OWNERSHIP OF MINORITY FINANCIAL INSTITUTIONS.
 (a) CONSULTATION ON METHODS- The Secretary of the Treasury shall consult
 with the Director of the Office of Thrift Supervision and the Chairperson
 of the Board of Directors of the Federal Deposit Insurance Corporation on
 methods for best achieving the following goals:
 (1) Preserving the present number of minority depository institutions.
 (2) Preserving their minority character in cases involving mergers or
 acquisition of a minority depository institution by using general preference
 guidelines in the following order:
 (A) Same type of minority depository institution in the same city.
 (B) Same type of minority depository institution in the same State.
 (C) Same type of minority depository institution nationwide.
 (D) Any type of minority depository institution in the same city.
 (E) Any type of minority depository institution in the same State.
 (F) Any type of minority depository institution nationwide.
 (G) Any other bidders.
 (3) Providing technical assistance to prevent insolvency of institutions
 not now insolvent.
 (4) Promoting and encouraging creation of new minority depository
 institutions.
 (5) Providing for training, technical assistance, and educational programs.
 (b) DEFINITIONS- For purposes of this section--
 (1) MINORITY FINANCIAL INSTITUTION- The term `minority depository institution'
 means any depository institution that--
 (A) if a privately owned institution, 51 percent is owned by one or more
 socially and economically disadvantaged individuals;
 (B) if publicly owned, 51 percent of the stock is owned by one or more
 socially and economically disadvantaged individuals; and
 (C) in the case of a mutual institution where the majority of the Board
 of Directors, account holders, and the community which it services is
 predominantly minority.
 (2) MINORITY- The term `minority' means any black American, Native American,
 Hispanic American, or Asian American.
TITLE IV--TRANSFER OF FUNCTIONS, PERSONNEL, AND PROPERTY
SEC. 401. FSLIC AND FEDERAL HOME LOAN BANK BOARD ABOLISHED.
 (a) IN GENERAL-
 (1) FSLIC- Effective on the date of the enactment of this Act, the Federal
 Savings and Loan Insurance Corporation established under section 402 of
 the National Housing Act is abolished.
 (2) FHLBB- Effective at the end of the 60-day period beginning on the date
 of the enactment of this Act, the Federal Home Loan Bank Board and the
 position of Chairman of the Federal Home Loan Bank Board are abolished.
 (b) DISPOSITION OF AFFAIRS-
 (1) IN GENERAL- During the 60-day period beginning on the date of the
 enactment of this Act, the Chairman of the Federal Home Loan Bank Board--
 (A) shall, solely for the purpose of winding up the affairs of the Federal
 Savings and Loan Insurance Corporation and the Federal Home Loan Bank Board--
 (i) manage the employees of the Board and provide for the payment of the
 compensation and benefits of any such employee which accrue before the
 effective date of the transfer of such employee pursuant to section 403; and
 (ii) manage any property of the Board and the Corporation until such property
 is transferred pursuant to section 405; and
 (B) may take any other action necessary for the purpose of winding up the
 affairs of the Corporation and the Board.
 (2) AVAILABILITY OF FUNDS IN FSLIC RESOLUTION FUND ON A REIMBURSABLE BASIS-
 (A) AVAILABILITY OF FUNDS- Notwithstanding any provision of section 11A of
 the Federal Deposit Insurance Act (as added by section 215 of this Act),
 funds in the FSLIC Resolution Fund shall be available to the Chairman of
 the Federal Home Loan Bank Board to pay any expense incurred in carrying
 out the requirements of paragraph (1).
 (B) PAYMENT BY FDIC- Upon the request of the Chairman of the Federal Home
 Loan Bank Board, the Federal Deposit Insurance Corporation shall pay to the
 Chairman from the FSLIC Resolution Fund the amounts requested for expenses
 described in subparagraph (A).
 (C) EXCLUSIVE SOURCE OF FUNDS- No funds or other property of the Federal
 Home Loan Bank Board or the Federal Savings and Loan Insurance Corporation
 (other than the FSLIC Resolution Fund) may be used by the Chairman of the
 Federal Home Loan Bank Board to pay any expense incurred in carrying out
 any provision of this title.
 (D) REIMBURSEMENT BY SUCCESSOR AGENCIES- Disbursements from the FSLIC
 Resolution Fund pursuant to subparagraph (A) which are attributable
 to employees described in paragraph (1)(A)(i) and property described in
 paragraph (1)(A)(ii) shall be reimbursed by the agency to which any such
 employee or property is transferred.
 (c) AUTHORITY AND STATUS OF CHAIRMAN OF THE FEDERAL HOME LOAN BANK BOARD-
 (1) IN GENERAL- Notwithstanding the repeal of section 17 of the Federal
 Home Loan Bank Act by section 703 of this Act, the repeal of section 402(c)
 of the National Housing Act by section 407 of this title, the abolishment
 of the Federal Savings and Loan Insurance Corporation under section 401 of
 this title, the Chairman of the Federal Home Loan Bank Board shall have any
 authority vested in the Chairman or the Board before such date of enactment
 which is necessary for the Chairman to carry out the requirements of this
 section, paragraphs (1) and (2) of section 403(b), and section 405(a)
 during the 60-day period beginning on such date.
 (2) OTHER PROVISIONS- For purposes of paragraph (1), the Chairman of the
 Federal Home Loan Bank Board shall continue to be--
 (A) treated as an officer of the United States during the 60-day period
 referred to in such subparagraph; and
 (B) entitled to compensation at the annual rate of basic pay payable for
 level III of the Executive Schedule.
 (3) NO ADDITIONAL COMPENSATION IF APPOINTED DIRECTOR- During the 60-day
 period beginning on the date of the enactment of this Act, the Chairman of
 the Federal Home Loan Bank Board shall not be entitled to any additional
 compensation by reason of his appointment as Director of the Office of
 Thrift Supervision.
 (d) STATUS OF EMPLOYEES BEFORE TRANSFER-
 (1) EMPLOYEES OF FSLIC- Any employee of the Federal Savings and Loan
 Insurance Corporation shall be treated as an employee of the Federal Home
 Loan Bank Board for purposes of subsection (b)(1)(A)(i).
 (2) RULE OF CONSTRUCTION- The repeal of section 17 of the Federal Home Loan
 Bank Act by section 703 of this Act, the repeal of section 402(c) of the
 National Housing Act by section 407 of this title, and the abolishment of
 the Federal Savings and Loan Insurance Corporation under section 401 of this
 title, shall not be construed as affecting the status of employees of such
 Corporation or of the Federal Home Loan Bank Board as employees of an agency
 of the United States for purposes of any other provision of law before the
 effective date of the transfer of any such employee pursuant to section 403.
 (e) CONTINUATION OF SERVICES-
 (1) IN GENERAL- The Director of the Office of Thrift Supervision, the
 Chairperson of the Oversight Board of the Resolution Trust Corporation,
 the Chairperson of the Federal Deposit Insurance Corporation, and the
 Chairperson of the Federal Housing Finance Board may use the services
 of employees and other personnel and the property of the Federal Home
 Loan Bank Board and the Federal Savings and Loan Insurance Corporation,
 on a reimbursable basis, to perform functions which have been transferred
 to such agencies for such time as is reasonable to facilitate the orderly
 transfer of functions transferred pursuant to any other provision of this
 Act or any amendment made by this Act to any other provision of law.
 (2) REIMBURSEMENT- The reimbursement required under paragraph (1) with
 respect to employees, personnel, and property described in such paragraph
 shall be made to the FSLIC Resolution Fund and shall be taken into account
 in determining the amount of any reimbursement required under subsection
 (b)(2)(D).
 (3) AGENCY SERVICES- Any agency, department, or other instrumentality of the
 United States (including any Federal home loan bank), and any successor to any
 such agency, department, or instrumentality, which was providing supporting
 services to the Federal Home Loan Bank Board or the Federal Savings and
 Loan Insurance Corporation before the enactment of this Act in connection
 with functions that are transferred to the Office of Thrift Supervision,
 the Resolution Trust Corporation, the Federal Deposit Insurance Corporation,
 or the Federal Housing Finance Board shall--
 (A) continue to provide such services, on a reimbursable basis, until the
 transfer of such functions is complete; and
 (B) consult with any such agency to coordinate and facilitate a prompt and
 reasonable transition.
 (f) SAVINGS PROVISIONS RELATING TO FSLIC-
 (1) EXISTING RIGHTS, DUTIES, AND OBLIGATIONS NOT AFFECTED- Subsection (a)
 shall not affect the validity of any right, duty, or obligation of the
 United States, the Federal Savings and Loan Insurance Corporation, or any
 other person, which--
 (A) arises under or pursuant to any section of title IV of the National
 Housing Act; and
 (B) existed on the day before the date of the enactment of this Act.
 (2) CONTINUATION OF SUITS- No action or other proceeding commenced by or
 against the Federal Savings and Loan Insurance Corporation, or any Federal
 home loan bank with respect to any function of the Corporation which was
 delegated to employees of such bank, shall abate by reason of the enactment
 of this Act, except that the appropriate successor to the interests of such
 Corporation shall be substituted for the Corporation or the Federal home
 loan bank as a party to any such action or proceeding.
 (g) SAVINGS PROVISIONS RELATING TO FHLBB-
 (1) EXISTING RIGHTS, DUTIES, AND OBLIGATIONS NOT AFFECTED- Subsection (a)
 shall not affect the validity of any right, duty, or obligation of the
 United States, the Federal Home Loan Bank Board, or any other person, which--
 (A) arises under or pursuant to the Federal Home Loan Bank Act, the Home
 Owners' Loan Act of 1933, or any other provision of law applicable with
 respect to such Board (other than title IV of the National Housing Act); and
 (B) existed on the day before the date of the enactment of this Act.
 (2) CONTINUATION OF SUITS-
 (A) IN GENERAL- No action or other proceeding commenced by or against the
 Federal Home Loan Bank Board, or any Federal home loan bank with respect to
 any function of the Board which was delegated to employees of such bank, shall
 abate by reason of the enactment of this Act, except that the appropriate
 successor to the interests of such Board shall be substituted for the Board
 or the Federal home loan bank as a party to any such action or proceeding.
 (h) CONTINUATION OF ORDERS, RESOLUTIONS, DETERMINATIONS, AND REGULATIONS-
 Subject to section 402, all orders, resolutions, determinations, and
 regulations, which--
 (1) have been issued, made, prescribed, or allowed to become effective by
 the Federal Savings and Loan Insurance Corporation or the Federal Home Loan
 Bank Board (including orders, resolutions, determinations, and regulations
 which relate to the conduct of conservatorships and receiverships), or by
 a court of competent jurisdiction, in the performance of functions which
 are transferred by this Act; and
 (2) are in effect on the date this Act takes effect,
shall continue in effect according to the terms of such orders, resolutions,
determinations, and regulations and shall be enforceable by or against the
Director of the Office of Thrift Supervision, the Federal Deposit Insurance
Corporation, the Federal Housing Finance Board, or the Resolution Trust
Corporation, as the case may be, until modified, terminated, set aside, or
superseded in accordance with applicable law by the Director of the Office of
Thrift Supervision, the Federal Deposit Insurance Corporation, the Federal
Housing Finance Board, or the Resolution Trust Corporation, as the case may
be, by any court of competent jurisdiction, or by operation of law.
 (i) IDENTIFICATION OF REGULATIONS WHICH REMAIN IN EFFECT PURSUANT TO THIS
 SECTION- Before the end of the 60-day period beginning on the date of the
 enactment of this Act, the Director of the Office of Thrift Supervision
 and the Chairperson of the Federal Deposit Insurance Corporation shall--
 (1) identify the regulations and orders which relate to the conduct of
 conservatorships and receiverships in accordance with the allocation of
 authority between them under this Act and the amendments made by this Act; and
 (2) promptly publish notice of such identification in the Federal Register.
SEC. 402. CONTINUATION AND COORDINATION OF CERTAIN REGULATIONS.
 (a) REGULATIONS RELATING TO INSURANCE FUNCTIONS- All regulations and orders
 of the Federal Savings and Loan Insurance Corporation, or the Federal Home
 Loan Bank Board (in such Board's capacity as the board of trustees of such
 Corporation), which are in effect on the date of the enactment of this Act
 and relate to--
 (1) the provision, rates, or cancellation of insurance of accounts; or
 (2) the administration of the insurance fund of the Federal Savings and
 Loan Insurance Corporation,
shall remain in effect according to the terms of such regulations and orders
and shall be enforceable by the Federal Deposit Insurance Corporation unless
determined otherwise by such Corporation after consultation with the Director
of the Office of Thrift Supervision and, with respect to regulations and
orders relating to the scope of deposit insurance coverage, pursuant to
subsection (c).
 (b) IDENTIFICATION OF REGULATIONS WHICH REMAIN IN EFFECT PURSUANT TO THIS
 SECTION- Before the end of the 60-day period beginning on the date of the
 enactment of this Act, the Director of the Office of Thrift Supervision
 and the Chairperson of the Federal Deposit Insurance Corporation shall--
 (1) identify the regulations and orders referred to in subsection (a) of
 this section in accordance with the allocation of authority between them
 under this Act and the amendments made by this Act; and
 (2) promptly publish notice of such identification in the Federal Register.
 (c) PROCEDURE FOR DIFFERENCES IN DEPOSIT INSURANCE COVERAGE BETWEEN FSLIC
 AND FDIC-
 (1) TRANSITION RULE- Until the effective date of regulations prescribed under
 paragraph (3)(B), any determination of the amount of any insured deposit in
 any depository institution which becomes an insured depository institution
 as a result of the amendment made to section 4(a) of the Federal Deposit
 Insurance Act by section 205(1) of this Act shall be made in accordance
 with the regulations and interpretations of the Federal Savings and Loan
 Insurance Corporation for determining the amount of an insured account
 which were in effect on the day before the date of the enactment of this Act.
 (2) LIMITATION ON EXTENT OF COVERAGE- During the period beginning on the date
 of the enactment of this Act and ending on the effective date of regulations
 prescribed under paragraph (3)(B), the amount of any insured account which
 is required to be treated as an insured deposit pursuant to paragraph (1)
 shall not exceed the amount of insurance to which such insured account would
 otherwise have been entitled pursuant to the regulations and interpretations
 of the Federal Savings and Loan Insurance Corporation which were in effect
 on the day before the date of the enactment of this Act.
 (3) UNIFORM TREATMENT OF INSURED DEPOSITS- The Federal Deposit Insurance
 Corporation shall--
 (A) review its regulations, principles, and interpretations for deposit
 insurance coverage and those established by the Federal Savings and Loan
 Insurance Corporation; and
 (B) on or before the end of the 270-day period beginning on the date of the
 enactment of this Act, prescribe a uniform set of regulations which shall
 be applicable to all insured deposits in insured depository institutions
 (except to the extent any provision of this Act, any amendment made by this
 Act to the Federal Deposit Insurance Act, or any other provision of law
 requires or explicitly permits the Federal Deposit Insurance Corporation
 to treat insured deposits of Savings Association Insurance Fund members
 differently than insured deposits of Bank Insurance Fund members).
 (4) FACTORS REQUIRED TO BE CONSIDERED- In prescribing regulations providing
 for the uniform treatment of deposit insurance coverage, the Federal Deposit
 Insurance Corporation shall consider all relevant factors necessary to
 promote safety and soundness, depositor confidence, and the stability of
 deposits in insured depository institutions.
 (5) NOTICE; EFFECTIVE DATE- Regulations prescribed under this subsection
 shall--
 (A) provide for effective notice to depositors in insured depository
 institutions of any change in deposit insurance coverage which would result
 under such regulations; and
 (B) take effect on or before the end of the 90-day period beginning on the
 date such regulations become final.
 (6) DEFINITIONS- For purposes of this subsection--
 (A) INSURED ACCOUNT- The term `insured account' has the meaning given to
 such term in section 401(c) of the National Housing Act (as in effect before
 the date of the enactment of this Act).
 (B) INSURED DEPOSITORY INSTITUTION- The term `insured depository institution'
 has the meaning given to such term in section 3(c)(2) of the Federal Deposit
 Insurance Act.
 (d) INTERIM TREATMENT OF CUSTODIAL ACCOUNTS-
 (1) IN GENERAL- Subject to paragraph (2) and notwithstanding subsection (a)
 or any limitation contained in the Federal Deposit Insurance Act relating to
 the amount of deposit insurance available to any 1 borrower, amounts held
 in custodial accounts in insured depository institutions (as defined in
 section 3(c)(2) of such Act) for the payment of principal, interest, tax,
 and insurance payments for mortgage borrowers, shall be insured under the
 Federal Deposit Insurance Act in the amount of $100,000 per mortgage borrower.
 (2) TREATMENT AFTER EFFECTIVE DATE OF NEW REGULATIONS- After the effective
 date of the regulations prescribed under subsection (c)--
 (A) the amount of deposit insurance available for custodial accounts shall
 be determined in accordance with such regulations; and
 (B) paragraph (1) shall cease to apply with respect to such accounts.
 (e) TREATMENT OF REFERENCES IN ADJUSTABLE RATE MORTGAGE INSTRUMENTS-
 (1) IN GENERAL- For purposes of adjustable rate mortgage instruments that
 are in effect as of the date of enactment of this Act, any reference in
 the instrument to the Federal Savings and Loan Insurance Corporation,
 the Federal Home Loan Bank Board, or institutions insured by the Federal
 Savings and Loan Insurance Corporation before such date shall be treated
 as a reference to the Federal Deposit Insurance Corporation, the Federal
 Housing Finance Board, the Office of Thrift Supervision, or institutions
 which are members of the Savings Association Insurance Fund, as appropriate
 on the basis of the transfer of functions pursuant to this Act, unless the
 context of the reference requires otherwise.
 (2) SUBSTITUTION FOR INDEXES- If any index used to calculate the applicable
 interest rate on any adjustable rate mortgage instrument is no longer
 calculated and made available as a direct or indirect result of the enactment
 of this Act, any index--
 (A) made available by the Director of the Office of Thrift Supervision, the
 Chairperson of the Federal Deposit Insurance Corporation, or the Chairperson
 of the Federal Housing Finance Board pursuant to paragraph (3); or
 (B) determined by the Director of the Office of Thrift Supervision, the
 Chairperson of the Federal Deposit Insurance Corporation, or the Chairperson
 of the Federal Housing Finance Board, pursuant to paragraph (4), to be
 substantially similar to the index which is no longer calculated or made
 available,
may be substituted by the holder of any such adjustable rate mortgage
instrument upon notice to the borrower.
 (3) AGENCY ACTION REQUIRED TO PROVIDE CONTINUED AVAILABILITY OF INDEXES-
 Promptly after the enactment of this subsection, the Director of the Office
 of Thrift Supervision, the Chairperson of the Federal Deposit Insurance
 Corporation, and the Chairperson of the Federal Housing Finance Board shall
 take such action as may be necessary to assure that the indexes prepared
 by the Federal Savings and Loan Insurance Corporation, the Federal Home
 Loan Bank Board, and the Federal home loan banks immediately prior to the
 enactment of this subsection and used to calculate the interest rate on
 adjustable rate mortgage instruments continue to be available.
 (4) REQUIREMENTS RELATING TO SUBSTITUTE INDEXES- If any agency can no
 longer make available an index pursuant to paragraph (3), an index that
 is substantially similar to such index may be substituted for such index
 for purposes of paragraph (2) if the Director of the Office of Thrift
 Supervision, the Chairperson of the Federal Deposit Insurance Corporation,
 or the Chairperson of the Federal Housing Finance Board, as the case may be,
 determines, after notice and opportunity for comment, that--
 (A) the new index is based upon data substantially similar to that of the
 original index; and
 (B) the substitution of the new index will result in an interest rate
 substantially similar to the rate in effect at the time the original index
 became unavailable.
SEC. 403. DETERMINATION OF TRANSFERRED FUNCTIONS AND EMPLOYEES.
 (a) ALL FHLBB AND FSLIC EMPLOYEES SHALL BE TRANSFERRED- All employees of
 the Federal Home Loan Bank Board and the Federal Savings and Loan Insurance
 Corporation shall be identified for transfer under subsection (b) to the
 Federal Deposit Insurance Corporation, the Office of Thrift Supervision,
 or the Federal Housing Finance Board.
 (b) FUNCTIONS AND EMPLOYEES TRANSFERRED-
 (1) IN GENERAL- The Director of the Office of Thrift Supervision, the
 Chairperson of the Oversight Board of the Resolution Trust Corporation, the
 Chairperson of the Federal Deposit Insurance Corporation, the Chairperson
 of the Federal Housing Finance Board, and the Chairman of the Federal Home
 Loan Bank Board (as of the day before the date of the enactment of this Act)
 shall jointly determine the functions or activities of the Federal Home Loan
 Bank Board and the Federal Savings and Loan Insurance Corporation, and the
 number of employees of such Board and Corporation necessary to perform or
 support such functions or activities, which are transferred from the Federal
 Home Loan Bank Board and the Federal Savings and Loan Insurance Corporation
 to the Office of Thrift Supervision, the Resolution Trust Corporation, the
 Federal Deposit Insurance Corporation, or the Federal Housing Finance Board,
 as the case may be.
 (2) ALLOCATION OF EMPLOYEES- The Director of the Office of Thrift Supervision,
 the Chairperson of the Oversight Board of the Resolution Trust Corporation,
 the Chairperson of the Federal Deposit Insurance Corporation, and the
 Chairperson of the Federal Housing Finance Board shall allocate the employees
 of the Federal Home Loan Bank Board and the Federal Savings and Loan Insurance
 Corporation consistent with the number determined pursuant to paragraph
 (1) in a manner which such Director, Chairman, and Chairpersons, in their
 sole discretion, deem equitable, except that, within work units, the agency
 preferences of individual employees shall be accommodated as far as possible.
 (c) FEDERAL HOME LOAN BANK PERSONNEL- Employees of the Federal home loan
 banks or the joint offices of such banks who, on the day before the date
 of the enactment of this Act, are performing functions or activities on
 behalf of the Federal Home Loan Bank Board or the Federal Savings and
 Loan Insurance Corporation shall be treated as employees of the Federal
 Home Loan Bank Board or the Federal Savings and Loan Insurance Corporation
 for purposes of determining, pursuant to subsection (b)(1), the number of
 employees performing or supporting functions or activities of such Board or
 Corporation to the extent such functions or activities are transferred to
 the Federal Deposit Insurance Corporation, the Office of Thrift Supervision,
 the Resolution Trust Corporation, or the Federal Housing Finance Board.
 (d) FSLIC EMPLOYEES ENGAGED IN CONSERVATORSHIP OR RECEIVERSHIP FUNCTIONS-
 Individuals who, on the day before the date of the enactment of this Act,
 are employed by the Federal Savings and Loan Insurance Corporation in such
 Corporation's capacity as conservator or receiver of any insured depository
 institution shall be treated as employees of the Federal Savings and Loan
 Insurance Corporation for purposes of determining, pursuant to subsection
 (b)(1), the number of employees performing or supporting functions or
 activities of such Corporation if such conservatorship or receivership is
 transferred to the Federal Deposit Insurance Corporation or the Resolution
 Trust Corporation.
SEC. 404. RIGHTS OF EMPLOYEES OF ABOLISHED AGENCIES.
 All employees identified for transfer under subsection (b) of section 403
 (other than individuals described in subsection (c) or (d) of such section)
 shall be entitled to the following rights:
 (1) Each employee so identified shall be transferred to the appropriate
 agency or entity for employment no later than 60 days after the date of
 the enactment of this Act and such transfer shall be deemed a transfer of
 function for the purpose of section 3503 of title 5, United States Code.
 (2) Each transferred employee shall be guaranteed a position with the same
 status, tenure, and pay as that held on the day immediately preceding the
 transfer. Each such employee holding a permanent position shall not be
 involuntarily separated or reduced in grade or compensation for 1 year
 after the date of transfer, except for cause.
 (3)(A) In the case of employees occupying positions in the excepted service
 or the Senior Executive Service, any appointment authority established
 pursuant to law or regulations of the Office of Personnel Management for
 filling such positions shall be transferred, subject to subparagraph (B).
 (B) An agency or entity may decline a transfer of authority under subparagraph
 (A) (and the employees appointed pursuant thereto) to the extent that such
 authority relates to positions excepted from the competitive service because
 of their confidential, policy-making, policy-determining, or policy-advocating
 character, and noncareer positions in the Senior Executive Service (within
 the meaning of section 3132(a)(7) of title 5, United States Code).
 (4) If any agency or entity to which employees are transferred determines,
 after the end of the 1-year period beginning on the date the transfer of
 functions to such agency or entity is completed, that a reorganization of
 the combined work force is required, that reorganization shall be deemed a
 `major reorganization' for purposes of affording affected employees retirement
 under section 8336(d)(2) or 8414(b)(1)(B) of title 5, United States Code.
 (5) Any employee accepting employment with any agency or entity (other than
 the Office of Thrift Supervision) as a result of such transfer may retain
 for 1 year after the date such transfer occurs membership in any employee
 benefit program of the Federal Home Loan Bank Board, including insurance,
 to which such employee belongs on the date of the enactment of this Act if--
 (A) the employee does not elect to give up the benefit or membership in
 the program; and
 (B) the benefit or program is continued by the Director of the Office of
 Thrift Supervision.
The difference in the costs between the benefits which would have been
provided by such agency or entity and those provided by this section shall
be paid by the Director of the Office of Thrift Supervision. If any employee
elects to give up membership in a health insurance program or the health
insurance program is not continued by the Director of the Office of Thrift
Supervision, the employee shall be permitted to select an alternate Federal
health insurance program within 30 days of such election or notice, without
regard to any other regularly scheduled open season.
 (6) Any employee employed by the Office of Thrift Supervision as a result
 of the transfer may retain membership in any employee benefit program of
 the Federal Home Loan Bank Board, including insurance, which such employee
 has on the date of enactment of this Act, if such employee does not elect
 to give up such membership and the benefit or program is continued by the
 Director of the Office of Thrift Supervision. If any employee elects to give
 up membership in a health insurance program or the health insurance program
 is not continued by the Director of the Office of Thrift Supervision, such
 employee shall be permitted to select an alternate Federal health insurance
 program within 30 days of such election or discontinuance, without regard
 to any other regularly scheduled open season.
 (7) A transferring employee in the Senior Executive Service shall be placed
 in a comparable position at the agency or entity to which such employee
 is transferred.
 (8) Transferring employees shall receive notice of their position assignments
 not later than 120 days after the effective date of their transfer.
 (9) Upon the termination of the Resolution Trust Corporation pursuant
 to section 21A(m) of the Federal Home Loan Bank Act, any employee of such
 Corporation shall be transferred to the Federal Deposit Insurance Corporation
 in accordance with the provisions of paragraphs (2) and (4) through (7)
 of this subsection, except that the liability for any difference in the
 costs of benefits described in paragraph (5) shall be a liability of the
 Resolution Trust Corporation and not the Office of Thrift Supervision.
SEC. 405. DIVISION OF PROPERTY AND FACILITIES.
 Before the end of the 60-day period beginning on the date of the enactment of
 this Act, the Director of the Office of Thrift Supervision, the Chairperson
 of the Oversight Board of the Resolution Trust Corporation, the Chairperson
 of the Federal Deposit Insurance Corporation, and the Chairperson of the
 Federal Housing Finance Board shall jointly divide all property of the Federal
 Savings and Loan Insurance Corporation and the Federal Home Loan Bank Board
 used to perform functions and activities of the Federal Home Loan Bank Board
 among the Office of Thrift Supervision, the Resolution Trust Corporation,
 the Federal Deposit Insurance Corporation, and the Federal Housing Finance
 Board in accordance with the division of responsibilities, functions, and
 activities effected by this Act. Any disagreement between them in so doing
 shall be resolved by the Director of the Office of Management and Budget.
SEC. 406. REPORT.
 Before the end of the 60-day period beginning on the date of the enactment
 of this Act, the Chairman of the Federal Home Loan Bank Board shall provide
 by written report to the Secretary of the Treasury, the Director of the
 Office of Management and Budget, and the Congress, a final accounting of the
 finances and operations of the Federal Savings and Loan Insurance Corporation.
SEC. 407. REPEALS.
 Title 4 of the National Housing Act (1724 et seq.) is hereby repealed.
TITLE V--FINANCING FOR THRIFT RESOLUTIONS
Subtitle A--Oversight Board and Resolution Trust Corporation
SEC. 501. OVERSIGHT BOARD AND RESOLUTION TRUST CORPORATION ESTABLISHED.
 (a) IN GENERAL- The Federal Home Loan Bank Act (12 U.S.C. 1421 et seq.) is
 amended by inserting after section 21 the following new section:
`SEC. 21A. OVERSIGHT BOARD AND RESOLUTION TRUST CORPORATION.
 `(a) OVERSIGHT BOARD ESTABLISHED-
 `(1) IN GENERAL- There is hereby established the Oversight Board as an
 instrumentality of the United States with the powers and authorities herein
 provided.
 `(2) STATUS- The Oversight Board shall oversee and be accountable for the
 Resolution Trust Corporation (hereinafter referred to in this section as
 the `Corporation'). The Oversight Board shall be an `agency' of the United
 States for purposes of subchapter II of chapter 5 and chapter 7 of title 5,
 United States Code.
 `(3) MEMBERSHIP-
 `(A) IN GENERAL- The Oversight Board shall consist of 5 members--
 `(i) the Secretary of the Treasury;
 `(ii) the Chairman of the Board of Governors of the Federal Reserve System;
 `(iii) the Secretary of Housing and Urban Development; and
 `(iv) two independent members appointed by the President, with the advice and
 consent of the Senate. Such nominations shall be referred to the Committee
 on Banking, Housing, and Urban Affairs of the Senate.
 `(B) POLITICAL AFFILIATION- The independent members shall not be members
 of the same political party. No independent member of the Oversight Board
 shall hold any other appointed office during his or her term as a member.
 `(C) CHAIRPERSON- The Chairperson of the Oversight Board shall be the
 Secretary of the Treasury.
 `(D) TERM OF OFFICE- The term of each member (other than the independent
 members) of the Oversight Board shall expire when such member has fulfilled
 all of his or her responsibilities under this section and section 21B. The
 term of each independent member shall be 3 years.
 `(E) QUORUM REQUIRED- A quorum shall consist of 3 members of the Oversight
 Board and all decisions of the Board shall require an affirmative vote of
 at least a majority of the members voting.
 `(4) COMPENSATION AND EXPENSES-
 `(A) EXPENSES- Members of the Oversight Board shall receive allowances in
 accordance with subchapter I of chapter 57 of title 5, United States Code,
 for necessary expenses of travel, lodging, and subsistence incurred in
 attending meetings and other activities of the Oversight Board, as set
 forth in the bylaws issued by the Oversight Board.
 `(B) NO ADDITIONAL COMPENSATION FOR UNITED STATES OFFICERS OR EMPLOYEES-
 Members of the Oversight Board (other than independent members) shall
 receive no additional pay by reason of service on such Board.
 `(C) COMPENSATION FOR INDEPENDENT MEMBERS- The independent members of the
 Oversight Board shall be paid at a rate equal to the daily equivalent of
 the rate of basic pay for level II of the Executive Schedule for each day
 (including travel time) during which such member is engaged in the actual
 performance of duties of the Oversight Board.
 `(5) POWERS- The Oversight Board shall be a body corporate that shall have
 the power to--
 `(A) adopt, alter, and use a corporate seal;
 `(B) provide for a principal or executive officer and such other officers
 and employees as may be necessary to perform the functions of the Oversight
 Board, define their duties, and require surety bonds or make other provisions
 against losses occasioned by acts of such persons;
 `(C) fix the compensation and number of, and appoint, employees for any
 position established by the Oversight Board;
 `(D) set and adjust rates of basic pay for employees of the Oversight Board
 without regard to the provisions of chapter 51 or subchapter III of chapter
 53 of title 5, United States Code;
 `(E) provide additional compensation and benefits to employees of the
 Oversight Board if the same type of compensation or benefits are then being
 provided by any other Federal bank regulatory agency or, if not then being
 provided, could be provided by such an agency under applicable provisions
 of law, rule, or regulation; in setting and adjusting the total amount
 of compensation and benefits for employees of the Oversight Board, the
 Oversight Board shall consult with and seek to maintain comparability with
 the other Federal bank regulatory agencies, except that the Oversight Board
 shall not in any event exceed the compensation and benefits provided by the
 Federal Deposit Insurance Corporation with respect to any comparable position;
 `(F) with the consent of any executive agency, department, or independent
 agency utilize the information, services, staff, and facilities of such
 department or agency, on a reimbursable (or other) basis, in carrying out
 this section;
 `(G) prescribe bylaws that are consistent with law to provide for the manner
 in which--
 `(i) its officers and employees are selected, and
 `(ii) its general operations are to be conducted;
 `(H) enter into contracts and modify or consent to the modification of any
 contract or agreement;
 `(I) sue and be sued in courts of competent jurisdiction; and
 `(J) exercise any and all powers established under this section and such
 incidental powers as are necessary to carry out its powers, duties, and
 functions under this Act.
 `(6) OVERSIGHT BOARD DUTIES AND AUTHORITIES- The Oversight Board shall have
 the following duties and authorities with respect to the Corporation:
 `(A) To develop and establish overall strategies, policies, and goals
 for the Corporation's activities in consultation with the Corporation,
 including such items as--
 `(i) general policies and procedures for case resolutions, the management
 and disposition of assets, the use of private contractors, and the use of
 notes, guarantees or other obligations by the Corporation;
 `(ii) overall financial goals, plans, and budgets; and
 `(iii) restructuring agreements described in subsection (b)(11)(B).
 `(B) To approve prior to implementation periodic financing requests developed
 by the Corporation.
 `(C) To review all rules, regulations, principles, procedures, and guidelines
 that may be adopted or announced by the Corporation. After consultation with
 the Corporation, the Oversight Board may require the modification of any
 such rules, regulations, principles, procedures, or guidelines except that
 the rules, regulations, principles, procedures, and guidelines relating
 to the Corporation's powers and activities as a conservator or receiver
 shall be consistent with the Federal Deposit Insurance Act. The provisions
 of this subparagraph shall not apply to internal administrative policies
 and procedures, and determinations or actions described in paragraph (8)
 of this subsection.
 `(D) To review the overall performance of the Corporation on a periodic
 basis, including its work, management activities, and internal controls,
 and the performance of the Corporation relative to approved budget plans.
 `(E) To require from the Corporation any reports, documents, and records
 it deems necessary to carry out its oversight responsibilities.
 `(F) To establish a national advisory board and regional advisory boards.
 `(G) To authorize the use of proceeds from any funds provided by the
 Treasury to the Corporation and from any financing by the Resolution Funding
 Corporation established pursuant to section 21B of this Act consistent with
 the approved budget and financial plans of the Corporation and to oversee
 the collection of funds by the Resolution Funding Corporation.
 `(H) To evaluate audits by the Inspector General and other congressionally
 required audits.
 `(I) To have general oversight over the Resolution Funding Corporation as
 provided under section 21B of this Act.
 `(J) To authorize, as appropriate, the Corporation's sale of capital
 certificates to the Resolution Funding Corporation.
 `(7) TRANSITION POLICIES- Until such time as the Oversight Board and the
 Corporation (consistent with paragraph (6) and subsection (b)(12)) adopt
 strategies, policies, goals, regulations, rules, operating principles,
 procedures, or guidelines, the Corporation may carry out its duties in
 accordance with the strategies, policies, goals, regulations, rules,
 operating principles, procedures, or guidelines of the Federal Deposit
 Insurance Corporation, notwithstanding the provisions of section 553 of
 title 5, United States Code.
 `(8) Limitation on authority-
 `(A) IN GENERAL- The Corporation shall have the authority, without any
 prior review, approval, or disapproval by the Oversight Board, to make such
 determinations and take such actions as it deems appropriate with respect
 to case-specific matters (i) involving individual case resolutions, (ii)
 asset liquidations, or (iii) day-to-day operations of the Corporation. The
 preceding sentence in no way limits the authority of the Oversight Board
 to provide general policies and procedures.
 `(B) FEDERAL DEPOSIT INSURANCE CORPORATION- Nothing contained in this
 section shall give the Oversight Board authority over the activities,
 powers, or functions of the Federal Deposit Insurance Corporation except
 to the extent provided in this section and only with respect to the
 activities of the Federal Deposit Insurance Corporation in carrying out
 the responsibilities of the Corporation. The Federal Deposit Insurance
 Corporation shall be subject to the obligations, responsibilities, duties,
 and restrictions imposed by this section only to the extent it is carrying
 out the functions of the Corporation.
 `(9) DELEGATION- Except with respect to the meetings required by paragraph
 (10), nothing in this section shall preclude a member of the Oversight
 Board who is a public official from delegating his or her authority to an
 employee or officer of such member's agency or organization, if such employee
 or officer has been appointed by the President with the advice and consent
 of the Senate. For purposes of the preceding sentence, the Chairman of the
 Board of Governors of the Federal Reserve System may delegate his or her
 authority to another member of the Board of Governors.
 `(10) QUARTERLY MEETINGS- Not less than 4 times each year, the Oversight
 Board shall conduct open meetings to establish and review the general
 policy of the Corporation and to consider such other standards, policies,
 and procedures necessary to carry out its functions under this Act.
 `(11) POWER TO REMOVE; JURISDICTION- Notwithstanding any other provision
 of law, any civil action, suit, or proceeding to which the Oversight Board
 is a party shall be deemed to arise under the laws of the United States,
 and the United States district courts shall have original jurisdiction. The
 Oversight Board may, without bond or security, remove any such action,
 suit, or proceeding from a State court to a United States District Court
 or to the United States District Court for the District of Columbia.
 `(12) ADMINISTRATIVE EXPENSES- The administrative expenses of the Oversight
 Board shall be paid by the Corporation, upon request of the Oversight Board.
 `(13) STANDARDS, POLICIES, PROCEDURES, GUIDELINES, AND STATEMENTS-
 The Oversight Board may issue rules, regulations, standards, policies,
 procedures, guidelines, and statements as the Oversight Board considers
 necessary or appropriate to carry out its authorities and duties under this
 Act which shall be promulgated pursuant to subchapter II of chapter 5 of
 title 5, United States Code.
 `(14) Strategic plan for corporation operations-
 `(A) IN GENERAL- The Oversight Board shall, subject to paragraph (6),
 develop a strategic plan for conducting the Corporation's functions and
 activities. The Oversight Board shall submit the strategic plan to the
 Congress not later than December 31, 1989.
 `(B) PROVISIONS OF PLAN- The strategic plan and implementing policies
 and procedures required under this paragraph shall at a minimum contain
 the following:
 `(i) Factors the Corporation shall consider in deciding the order in which
 failed institutions or categories of failed institutions will be resolved.
 `(ii) Standards the Corporation shall use to select the appropriate resolution
 action for a failed institution.
 `(iii) With respect to assisted acquisitions, factors the Corporation shall
 consider in deciding whether non-performing assets of the failed institution
 will be transferred to the acquiring institution rather than retained by
 the Corporation for management and disposal.
 `(iv) Plans for the disposition of assets.
 `(v) Management objectives by which the Corporation's progress in carrying
 out its duties under this section can be measured.
 `(vi) A plan for the organizational structure and staffing of the Corporation,
 including an assessment of the extent to which the Corporation will perform
 asset management functions and other duties through contracts with public
 and private entities.
 `(vii) Consideration of whether incentives should be included in asset
 management contracts to promote active and efficient asset management.
 `(viii) Standards for adequate competition and fair and consistent treatment
 of offerors.
 `(ix) Standards that prohibit discrimination on the basis of race, sex,
 or ethnic group in the solicitation and consideration of offers.
 `(x) Procedures for the active solicitation of offers from minorities
 and women.
 `(xi) Procedures requiring that unsuccessful offerors be notified in writing
 of the decision within 30 days after the offer has been rejected.
 `(xii) Procedures for establishing the market value of assets based upon
 standard market analysis, valuation, and appraisal practices.
 `(xiii) Procedures requiring the timely evaluation of purchase offers for
 an institution.
 `(xiv) Procedures for bulk sales and auction marketing of assets.
 `(xv) Guidelines for determining if the value of an asset has decreased so
 that no reasonable recovery is anticipated. In such cases, the Corporation
 may consider potential public uses of such asset including providing housing
 for lower income families (including the homeless), day care centers for
 the children of low- and moderate-income families, or such other public
 purpose designated by the Secretary of Housing and Urban Development.
 `(xvi) Guidelines for the conveyance of assets to units of general local
 government, States, and public agencies designated by a unit of general
 local government or a State, for use in connection with urban homesteading
 programs approved by the Secretary of Housing and Urban Development under
 section 810 of the Housing and Community Development Act of 1974.
 `(xvii) Policies and procedures for avoiding political favoritism and undue
 influence in contracts and decisions made by the Oversight Board and the
 Corporation.
 `(15) TERMINATION- The Oversight Board shall terminate not later than 60 days
 after the Oversight Board fulfills all of its responsibilities under this Act.
 `(b) RESOLUTION TRUST CORPORATION ESTABLISHED-
 `(1) ESTABLISHMENT-
 `(A) IN GENERAL- There is hereby established a Corporation to be known as
 the Resolution Trust Corporation which shall be an instrumentality of the
 United States.
 `(B) STATUS- The Corporation shall be deemed to be an agency of the United
 States for purposes of subchapter II of chapter 5 and chapter 7 of title 5,
 United States Code, when it is acting as a corporation. The Corporation,
 when it is acting as a conservator or receiver of an insured depository
 institution, shall be deemed to be an agency of the United States to the
 same extent as the Federal Deposit Insurance Corporation when it is acting
 as a conservator or receiver of an insured depository institution.
 `(C) FDIC AS EXCLUSIVE MANAGER- Immediately upon enactment of the Financial
 Institutions Reform, Recovery, and Enforcement Act of 1989, the Federal
 Deposit Insurance Corporation shall be authorized to and shall perform all
 responsibilities of the Corporation, and shall continue to do so unless
 removed pursuant to subsection (m).
 `(2) GOVERNMENT CORPORATION- Notwithstanding the fact that no Government
 funds may be invested in the Corporation, the Corporation shall be treated,
 for purposes of sections 9105, 9107, and 9108 of title 31, United States
 Code, as a mixed-ownership Government corporation which has capital of
 the Government.
 `(3) DUTIES- The duties of the Corporation shall be to carry out a program,
 under the general oversight of the Oversight Board and through the Federal
 Deposit Insurance Corporation (or any replacement authorized pursuant to
 subsection (m)), including:
 `(A) To manage and resolve all cases involving depository institutions--
 `(i) the accounts of which were insured by the Federal Savings and Loan
 Insurance Corporation before the enactment of the Financial Institutions
 Reform, Recovery, and Enforcement Act of 1989; and
 `(ii) for which a conservator or receiver--
 `(I) had been appointed at any time during the period beginning on January
 1, 1989, and ending on the date of the enactment of such Act (including
 any institution described in paragraph (6)); or
 `(II) is appointed within the 3-year period beginning on the date of the
 enactment of such Act.
 `(B) To manage the Federal Asset Disposition Association, subject to the
 provisions of subsection (f).
 `(C) To conduct the operations of the Corporation in a manner which--
 `(i) maximizes the net present value return from the sale or other
 disposition of institutions described in subparagraph (A) or the assets of
 such institutions;
 `(ii) minimizes the impact of such transactions on local real estate and
 financial markets;
 `(iii) makes efficient use of funds obtained from the Funding Corporation
 or from the Treasury;
 `(iv) minimizes the amount of any loss realized in the resolution of
 cases; and
 `(v) maximizes the preservation of the availability and affordability of
 residential real property for low- and moderate-income individuals.
 `(D) To perform any other function authorized under this section.
 `(4) CONSERVATORSHIP, RECEIVERSHIP, AND ASSISTANCE POWERS- Except as
 provided in paragraph (5) and in addition to any other provision of this
 section, the Corporation shall have the same powers and rights to carry
 out its duties with respect to institutions described in paragraph (3)(A)
 as the Federal Deposit Insurance Corporation has under sections 11, 12, and
 13 of the Federal Deposit Insurance Act with respect to insured depository
 institutions (as defined in section 3 of the Federal Deposit Insurance Act).
 `(5) LIMITATION ON PARAGRAPH (4) POWERS- The Corporation--
 `(A) may not obligate the Federal Deposit Insurance Corporation or any
 funds of the Federal Deposit Insurance Corporation; and
 `(B) in connection with providing assistance to an institution under this
 subsection, shall be subject to the limitations contained in section 13(c)(4)
 of the Federal Deposit Insurance Act.
 `(6) SUCCESSOR TO FSLIC AS CONSERVATOR OR RECEIVER- As of the date of
 enactment of the Financial Institutions Reform, Recovery, and Enforcement
 Act of 1989, the Corporation shall succeed the Federal Savings and Loan
 Insurance Corporation as conservator or receiver with respect to any
 institution for which the Federal Savings and Loan Insurance Corporation was
 appointed conservator or receiver during the period beginning on January 1,
 1989 and ending on such date of enactment.
 `(7) OBLIGATIONS AND GUARANTEES- The Corporation's authority to issue
 obligations and guarantees shall be subject to general supervision by the
 Oversight Board under subsection (a) and shall be consistent with subsection
 (j).
 `(8) BOARD OF DIRECTORS-
 `(A) IN GENERAL- Except as provided in subsection (m), the Board of Directors
 of the Federal Deposit Insurance Corporation shall serve as the Board of
 Directors of the Corporation.
 `(B) CHAIRPERSON- Except as provided in subsection (m), the Chairperson of
 the Board of Directors of the Federal Deposit Insurance Corporation shall
 serve as the Chairperson of the Board of Directors of the Corporation.
 `(C) COMPENSATION- Members of the Board of Directors of the Corporation shall
 receive no pay, allowances, or benefits from the Corporation by reason of
 their service on the Board of Directors, but shall receive allowances in
 accordance with subchapter I of chapter 57 of title 5, United States Code,
 for necessary expenses of travel, lodging, and subsistence incurred in
 attending meetings and other activities of the Board of Directors, as set
 forth in the bylaws issued by the Board of Directors.
 `(9) STAFF-
 `(A) IN GENERAL- Unless the Oversight Board exercises its authority under
 subsection (m), the Corporation itself shall have no employees.
 `(B) UTILIZATION OF PERSONNEL OF OTHER AGENCIES-
 `(i) FDIC- The Federal Deposit Insurance Corporation, when acting as the
 exclusive manager of the Corporation, shall (subject to subsection (a)(6))
 receive reimbursement from the Corporation for all services performed for
 the Corporation. Such reimbursement may not exceed the actual and reasonable
 cost incurred by the Federal Deposit Insurance Corporation in performing
 such services.
 `(ii) OTHER AGENCIES- With the agreement of any executive department or
 agency, the Corporation may utilize the personnel of any such executive
 department or agency on a reimbursable basis to cover actual and reasonable
 expenses.
 `(10) CORPORATE POWERS- The Corporation shall have the following powers:
 `(A) To adopt, alter, and use a corporate seal.
 `(B) In the event the Oversight Board exercises its authority under subsection
 (m), the Corporation shall provide for a chief executive officer, 1 or more
 vice presidents, a secretary, a general counsel, a treasurer, and such
 other officers, employees, attorneys, and agents as the Corporation may
 determine to be necessary, define the duties of such officers or employees,
 and require surety bonds or make other provisions against losses occasioned
 by acts of such individuals.
 `(C) To enter into contracts and modify, or consent to the modification of,
 any contract or agreement to which the Corporation is a party or in which
 the Corporation has an interest under this section.
 `(D) To make advance, progress, or other payments.
 `(E) To acquire, hold, lease, mortgage, maintain, or dispose of, at public
 or private sale, real and personal property, and otherwise exercise all
 the usual incidents of ownership of property necessary and convenient to
 the operations of the Corporation.
 `(F) To sue and be sued in its corporate capacity in any court of competent
 jurisdiction.
 `(G) To deposit any securities or funds held by the Corporation in any
 facility or depositary described in section 13(b) of the Federal Deposit
 Insurance Act under the terms and conditions applicable to the Federal
 Deposit Insurance Corporation under such section 13(b) and pay fees thereof
 and receive interest thereon.
 `(H) To take warrants, voting and nonvoting equity, or other participation
 interests in institutions or assets or properties of institutions described
 in paragraph (3)(A) and paragraph (11)(A)(iv).
 `(I) To use the United States mails in the same manner and under the same
 conditions as other departments and agencies of the United States.
 `(J) To prescribe through its Board of Directors bylaws that shall be
 consistent with law.
 `(K) To make loans.
 `(L) To prepare reports and provide such reports, documents, and records
 to the Oversight Board as required by this section.
 `(M) To issue capital certificates to the Resolution Funding Corporation
 consistent with the provisions of section 21B of this Act in the following
 manner:
 `(i) AUTHORIZATION TO ISSUE- The Corporation is hereby authorized to issue
 to the Resolution Funding Corporation nonvoting capital certificates.
 `(ii) REQUIREMENT RELATING TO THE AMOUNT OF CERTIFICATES- The amount of
 certificates issued by the Corporation under clause (i) shall be equal to
 the aggregate amount of funds provided by the Resolution Funding Corporation
 to the Corporation under section 21B.
 `(iii) CERTIFICATES MAY BE ISSUED ONLY TO THE RESOLUTION FUNDING CORPORATION-
 Capital certificates issued under clause (i) may be issued only to the
 Resolution Funding Corporation in the manner and to the extent provided in
 section 21B and this section.
 `(iv) NO DIVIDENDS- The Corporation shall not pay dividends on any capital
 certificates issued under this section.
 `(N) To exercise any other power established under this section and such
 incidental powers as are necessary to carry out its duties and functions
 under this section.
 `(11) Special powers-
 `(A) IN GENERAL- In addition to the powers of the Corporation described in
 paragraph (10), the Corporation shall have the following powers:
 `(i) CONTRACTS- The Corporation may enter into contracts with any person,
 corporation, or entity, including State housing finance authorities (as
 such term is defined in section 1301 of the Financial Institutions Reform,
 Recovery, and Enforcement Act of 1989) and insured depository institutions,
 which the Corporation determines to be necessary or appropriate to carry
 out its responsibilities under this section. Such contracts shall be subject
 to the procedures adopted pursuant to paragraph (12).
 `(ii) UTILIZATION OF PRIVATE SECTOR- In carrying out the Corporation's
 duties under this section, the Corporation and the Federal Deposit Insurance
 Corporation shall utilize the services of private persons, including real
 estate and loan portfolio asset management, property management, auction
 marketing, and brokerage services, if such services are available in the
 private sector and the Corporation determines utilization of such services
 are practicable and efficient.
 `(iii) MERGERS AND CONSOLIDATIONS- The Corporation may require a merger or
 consolidation of an institution or institutions over which the Corporation
 has jurisdiction, if such merger or consolidation is consistent with section
 13(c)(4) of the Federal Deposit Insurance Act.
 `(iv) ORGANIZATION OF SAVINGS ASSOCIATIONS- The Corporation may organize
 1 or more Federal savings associations--
 `(I) which shall be chartered by the Director of the Office of Thrift
 Supervision,
 `(II) the deposits of which, if any, shall be insured by the Federal Deposit
 Insurance Corporation through the Savings Association Insurance Fund, and
 `(III) which shall operate in accordance with subsection (e).
 `(v) ORGANIZATION OF BRIDGE BANKS- The Corporation may organize 1 or more
 bridge banks pursuant to subsection (i) of section 11 of the Federal Deposit
 Insurance Act with respect to any institution described in paragraph (3)(A)
 which becomes a bank. Such bridge bank shall be subject to subsection (e).
 `(B) REVIEW OF PRIOR CASES- The Corporation shall--
 `(i) review and analyze all insolvent institution cases resolved by the
 Federal Savings and Loan Insurance Corporation between January 1, 1988,
 and the date of enactment of the Financial Institutions Reform, Recovery,
 and Enforcement Act of 1989, and actively review all means by which it can
 reduce costs under existing Federal Savings and Loan Insurance Corporation
 agreements relating to such cases, including restructuring such agreements;
 `(ii) evaluate the costs under existing Federal Savings and Loan Insurance
 Corporation agreements with regard to the following--
 `(I) capital loss coverage,
 `(II) yield maintenance guarantees,
 `(III) forbearances,
 `(IV) tax consequences, and
 `(V) any other relevant cost consideration;
 `(iii) review the bidding procedures used in resolving such cases in order
 to determine whether the bidding and negotiating processes were sufficiently
 competitive; and
 `(iv) report to the Oversight Board and the Congress pursuant to subsection
 (k).
The Corporation shall exercise any and all legal rights to modify, renegotiate,
or restructure such agreements where savings would be realized by such
actions. The cost or income of any modification shall be a liability or an
asset of the Corporation or the FSLIC Resolution Fund as determined by the
Oversight Board. Nothing in this paragraph shall be construed as granting
the Corporation any legal rights to modify, renegotiate, or restructure
agreements between the Federal Savings and Loan Insurance Corporation and
any other party, which did not exist prior to the date of enactment of the
Financial Institutions Reform, Recovery, and Enforcement Act of 1989.
 `(12) Regulations, policies, and procedures-
 `(A) IN GENERAL- Subject to the review of the Oversight Board, the
 Corporation shall adopt the rules, regulations, standards, policies,
 procedures, guidelines, and statements necessary to implement the strategic
 plan established by the Oversight Board under subsection (a)(14). The
 Corporation may issue such rules, regulations, standards, policies,
 procedures, guidelines, and statements as the Corporation considers necessary
 or appropriate to carry out this section.
 `(B) REVIEW, ETC- Such rules, regulations, standards, policies, procedures,
 guidelines, and statements--
 `(i) shall be provided by the Corporation to the Oversight Board promptly
 or prior to publication or announcement to the extent practicable;
 `(ii) shall be subject to the review of the Oversight Board as provided in
 subsection (a)(6)(C); and
 `(iii) shall be promulgated pursuant to subchapter II of chapter 5 of title
 5, United States Code.
 `(C) PREPARATION AND MAINTENANCE OF RECORDS RELATING TO SOLICITATION AND
 ACCEPTANCE OF OFFERS- The Corporation shall--
 `(i) document decisions made in the solicitation and selection process and
 the reasons for the decisions; and
 `(ii) maintain such documentation in the offices of the Corporation, as well
 as any other documentation relating to the solicitation and selection process.
 `(D) Distressed areas-
 `(i) IN GENERAL- In developing its implementing policies, the Corporation
 shall take the action described in clause (ii) to avoid adverse economic
 impact for those real estate markets that are distressed.
 `(ii) VALUATION AND DISPOSITION- The Corporation shall establish an
 appraisal or other valuation method for determining the market value of
 real property. With respect to a real property asset with a market value in
 excess of a certain dollar limit (such limit to be determined by the Board of
 Directors of the Corporation), consideration shall be given to the volume of
 assets above such limit and the potential impact of sales in such distressed
 areas. The Corporation shall not sell a real property asset located in a
 distressed area without obtaining at least the minimum disposition price,
 unless a determination has been made that such a transaction furthers the
 objectives set forth in paragraph (3)(C).
 `(iii) EXCEPTION- The provisions of this subparagraph shall not apply to
 any property as long as such property is subject to the requirements of
 subsection (c).
 `(E) DEFINITIONS- For the purposes of this subsection--
 `(i) The term `minimum disposition price' means 95 percent of the market value
 established by the Corporation. The Board of Directors, in its discretion,
 may change the percentage set forth in this definition from time to time
 if the Board of Directors determines that such change does not adversely
 impact the objectives set forth in paragraph (3)(C).
 `(ii) The term `sell a real property asset' means to convey all title and
 interest in a piece of tangible real property in which the Corporation has a
 fee simple or equivalent interest. The term `real property' does not include
 loans secured by real property, joint ventures, participation interests,
 options, or other similar interests. In addition, the term `sell' does not
 include hypothecation of assets, issuance of asset backed securities, issuance
 of joint ventures, or participation interests, or other similar activities.
 `(iii) The term `distressed area' means the geographic areas in those
 political subdivisions designated from time to time by the Board of
 Directors as having depressed real estate markets. Until the Board of
 Directors designates otherwise, such distressed areas shall be the States
 of Arkansas, Colorado, Louisiana, New Mexico, Oklahoma, and Texas.
 `(iv) The term `market value' means the most probable price which a property
 should bring in a competitive and open market if--
 `(I) all conditions requisite to a fair sale are present,
 `(II) the buyer and seller are acting prudently and are knowledgable, and
 `(III) the price is not affected by any undue stimulus.
 `(F) REAL ESTATE ASSET DIVISION- The Corporation shall establish a Real
 Estate Asset Division to assist and advise the Corporation with respect to the
 management, sale, or other disposition of real property assets of institutions
 described in paragraph (3)(A). The Real Estate Asset Division shall have
 such duties as the Corporation establishes, including the publication of an
 inventory of real property assets of institutions subject to the jurisdiction
 of the Corporation. Such inventory shall be published before January 1,
 1990 and updated semiannually thereafter and shall identify properties with
 natural, cultural, recreational, or scientific values of special significance.
 `(13) PERIODIC FINANCING REQUESTS- The Corporation shall provide the
 Oversight Board with periodic financing requests which shall detail--
 `(A) anticipated funding requirements for operations, case resolution,
 and asset liquidation,
 `(B) anticipated payments on previously issued notes, guarantees, other
 obligations, and related activities, and
 `(C) any proposed use of notes, guarantees or other obligations.
Such financing requests shall be submitted on a quarterly basis or such other
period as the Oversight Board determines necessary. Following approval by
the Oversight Board, such requests shall form the basis for expending funds
provided by the Treasury, for transferring funds from the Resolution Funding
Corporation to the Corporation and the issuance of capital certificates by
the Corporation in exchange therefor.
 `(14) FISCAL YEAR 1989 FUNDING-
 `(A) FUNDS FROM TREASURY- The Secretary of the Treasury shall provide the
 Corporation with the sum of $18,800,000,000 in fiscal year 1989, and for
 such purpose the Secretary is authorized to use as a public debt transaction
 the proceeds of the sale of any securities hereafter issued under chapter
 31 of title 31, United States Code.
 `(B) FUNDS FROM RESOLUTION FUNDING CORPORATION- The Resolution Funding
 Corporation shall provide the Corporation with such sums authorized pursuant
 to section 21B(e)(8) and the Corporation shall issue capital certificates
 in exchange therefor.
 `(c) Disposition of Eligible Residential Properties-
 `(1) PURPOSE- The purpose of this subsection is to provide homeownership
 and rental housing opportunities for very low-income, lower-income, and
 moderate-income families.
 `(2) RULES GOVERNING DISPOSITION OF ELIGIBLE SINGLE FAMILY PROPERTIES-
 `(A) NOTICE TO CLEARINGHOUSES- Within a reasonable period of time after
 acquiring title to an eligible single family property, the Corporation
 shall provide written notice to clearinghouses. Such notice shall contain
 basic information about the property, including but not limited to location,
 condition, and information relating to the estimated fair market value of
 the property. Each clearinghouse shall make such information available,
 upon request, to other public agencies, other nonprofit organizations,
 and qualifying households. The Corporation shall allow public agencies,
 nonprofit organizations, and qualifying households reasonable access to
 eligible single family property for purposes of inspection.
 `(B) OFFERS TO SELL SINGLE FAMILY PROPERTIES TO NONPROFIT ORGANIZATIONS,
 PUBLIC AGENCIES, AND QUALIFYING HOUSEHOLDS- For the 3-month period following
 the date on which the Corporation makes an eligible single family property
 available for sale, the Corporation shall offer to sell the property to (i)
 qualifying households, or (ii) public agencies or nonprofit organizations
 that agree to (I) make the property available for occupancy by and maintain
 it as affordable for lower-income families for the remaining useful life
 of such property, or (II) make the property available for purchase by such
 families. The restrictions described in subclause (I) of the preceding
 sentence shall be contained in the deed or other recorded instrument. If
 upon the expiration of such 3-month period, no qualifying household,
 public agency, or nonprofit organization has made a bona fide offer to
 purchase the property, the Corporation may offer to sell the property to
 any purchaser. The Corporation shall actively market eligible single family
 properties for sale to lower-income families.
 `(3) Rules governing disposition of eligible multifamily housing properties-
 `(A) NOTICE TO CLEARINGHOUSES- Within a reasonable period of time after
 acquiring title to an eligible multifamily housing property, the Corporation
 shall provide written notice to clearinghouses. Such notice shall contain
 basic information about the property, including but not limited to location,
 number of units (identified by number of bedrooms), and information relating
 to the estimated fair market value of the property. The clearinghouses shall
 make such information available, upon request, to qualifying multifamily
 purchasers. The Corporation shall allow qualifying multifamily purchasers
 reasonable access to an eligible multifamily housing property for purposes
 of inspection.
 `(B) EXPRESSION OF SERIOUS INTEREST- Qualifying multifamily purchasers may
 give written notice of serious interest in a property during a period ending
 90 days after the time the Corporation provides notice under subparagraph
 (A), or until the Corporation determines that a property is ready for sale,
 whichever occurs first. Such notice of serious interest shall be in such
 form and include such information as the Corporation may prescribe.
 `(C) NOTICE OF READINESS FOR SALE- Upon determining that a property
 is ready for sale the Corporation shall provide written notice to any
 qualifying multifamily purchaser that has expressed serious interest in
 the property. Such notice shall specify the minimum terms and conditions
 for sale of the property.
 `(D) OFFERS TO PURCHASE- A qualifying multifamily purchaser receiving
 notice in accordance with subparagraph (C) shall have 45 days (from the date
 notice is received) to make a bona fide offer to purchase a property. The
 Corporation shall accept an offer that complies with the terms and conditions
 established by the Corporation.
 `(E) LOWER-INCOME OCCUPANCY REQUIREMENTS- Not less than 35 percent of
 all dwelling units purchased by a qualifying multifamily purchaser under
 subparagraph (D) shall be made available for occupancy by and maintained
 as affordable for lower-income families during the remaining useful life of
 the property in which the units are located, provided that not less than 20
 percent of all units shall be made available for occupancy by and maintained
 as affordable for very low-income families during the remaining useful life
 of such property. If a single entity purchases more than 1 eligible property
 as part of the same negotiation, the requirements of this subparagraph shall
 apply in the aggregate to the properties so purchased. The requirements of
 this subparagraph shall be contained in the deed or other recorded instrument.
 `(F) SALE OF MULTIFAMILY PROPERTIES TO OTHER PURCHASERS-
 `(i) If, upon the expiration of the period referred to in subparagraph (B),
 no qualifying multifamily purchaser has expressed serious interest in a
 property, the Corporation may offer to sell the property, individually or
 in combination with other properties, to any purchaser.
 `(ii) The Corporation may not sell in combination with other properties
 any property which a qualifying multifamily purchaser has expressed serious
 interest in purchasing individually.
 `(iii) If, upon the expiration of the period referred to in subparagraph
 (D), no qualifying multifamily purchaser has made an offer to purchase
 the property, the Corporation may sell the property, individually or in
 combination with other properties, to any purchaser.
 `(G) Exemptions-
 `(i) CONTINUED OCCUPANCY OF CURRENT RESIDENTS- No purchaser of an eligible
 multifamily housing property may terminate the occupancy of any person
 residing in the property on the date of purchase for purposes of meeting
 the lower-income occupancy requirement applicable to the property under
 subparagraph (E). The purchaser shall be in compliance with this paragraph
 if each newly vacant dwelling unit is reserved for lower-income occupancy
 until the lower-income occupancy requirement is met.
 `(ii) FINANCIAL INFEASIBILITY- The Secretary of Housing and Urban Development
 or the State housing finance agency for the State in which the property
 is located may temporarily reduce the lower-income occupancy requirements
 applicable to any property under subparagraph (E), if the Secretary or the
 applicable State housing finance agency determines that an owner's compliance
 with such requirements is no longer financially feasible. The owner of the
 property shall make a good-faith effort to return lower-income occupancy
 to the level required by subparagraph (E), and the Secretary of Housing and
 Urban Development or the State housing finance agency, as appropriate, shall
 review the reduction annually to determine whether financial infeasibility
 continues to exist.
 `(4) Rent limitations-
 `(A) IN GENERAL- With respect to properties under subparagraph (B), rents
 charged to tenants for units made available for occupancy by very-low income
 families shall not exceed 30 percent of the adjusted income of a family whose
 income equals 50 percent of the median income for the area, as determined by
 the Secretary, with adjustment for family size. Rents charged to tenants for
 units made available for occupancy by lower-income families other than very
 low-income families shall not exceed 30 percent of the adjusted income of
 a family whose income equals 65 percent of the median income for the area,
 as determined by the Secretary, with adjustment for family size.
 `(B) APPLICABILITY- The rent limitations under this paragraph shall apply to
 any eligible single-family property sold pursuant to paragraph (2)(B)(ii)(I)
 and to any multifamily housing property sold pursuant to paragraph (3).
 `(5) PREFERENCE FOR SALES- When selling any eligible multifamily housing
 property or combinations of eligible residential properties, the Corporation
 shall give preference, among substantially similar offers, to the offer
 that would reserve the highest percentage of dwelling units for occupancy
 or purchase by very low-income families and lower-income families and would
 retain such affordability for the longest term.
 `(6) Financing of sale-
 `(A) Assistance by corporation-
 `(i) SALE PRICE- The Corporation shall establish a market value for each
 eligible residential property. The Corporation shall sell eligible residential
 property at the net realizable market value. The Corporation may agree to sell
 an eligible single family property at a price below the net realizable market
 value to the extent necessary to facilitate an expedited sale of the property
 and enable a lower-income family to purchase the property. The Corporation
 may agree to sell eligible residential property at a price below the net
 realizable market value to the extent necessary to facilitate an expedited
 sale of such property and enable a public agency or nonprofit organization
 to comply with the lower-income occupancy requirements applicable to such
 property under paragraphs (2) and (3).
 `(ii) PURCHASE LOAN- The Corporation may provide a loan at market interest
 rates to the purchaser of eligible residential property for all or a portion
 of the purchase price, which loan shall be secured by a first or second
 mortgage on the property. The Corporation may provide such a loan at below
 market interest rates to the extent necessary to facilitate an expedited
 sale of eligible residential property and permit (I) a lower-income family
 to purchase an eligible single family property under paragraph (2); or (II)
 a public agency or nonprofit organization to comply with the lower-income
 occupancy requirements applicable to the purchase of an eligible residential
 property under paragraph (2) or (3). The Corporation shall provide such
 loan in a form which would permit its sale or transfer to a subsequent holder.
 `(B) ASSISTANCE BY HUD- The Secretary shall take such action as may be
 necessary to expedite the processing of applications for assistance under
 section 202 of the Housing Act of 1959, the United States Housing Act of
 1937, title IV of the Stewart B. McKinney Homeless Assistance Act, section
 810 of the Housing and Community Development Act of 1974, and the National
 Housing Act to enable any organization or individual to purchase eligible
 residential property.
 `(C) ASSISTANCE BY FMHA- The Secretary of Agriculture shall take such
 actions as may be necessary to expedite the processing of applications
 for assistance under title V of the Housing Act of 1949 to enable any
 organization or individual to purchase eligible residential property.
 `(7) CONTRACTING RULES- Contracts entered into under this subsection shall
 not be subject to the requirements of subsection (b)(11)(A).
 `(8) Use of secondary market agencies-
 `(A) IN GENERAL- In the disposition of eligible residential properties, the
 Corporation shall, in consultation with the Secretary, explore opportunities
 to work with secondary market entities to provide housing for lower- and
 moderate-income families.
 `(B) CREDIT ENHANCEMENT- With respect to such Corporation properties,
 the Secretary may, consistent with statutory authorities, work through the
 Federal Housing Administration, the Government National Mortgage Association,
 the Federal National Mortgage Association, the Federal Home Loan Mortgage
 Corporation, and other secondary market entities to develop risk sharing
 structures, mortgage insurance, and other credit enhancements to assist
 in the provision of property ownership, rental, and cooperative housing
 opportunities for lower- and moderate-income families.
 `(C) REPORT- In the annual report submitted by the Secretary to the Congress,
 the Secretary shall include a detailed description of his activities under
 this paragraph, including recommendations for such additional authorization
 as he deems necessary to implement the provisions of this subsection.
 `(9) DEFINITIONS- For purposes of this subsection--
 `(A) ADJUSTED INCOME- The term `adjusted income' has the same meaning as
 such term has under section 3 of the United States Housing Act of 1937.
 `(B) CLEARINGHOUSES- The term `clearinghouses' means--
 `(i) the State housing finance agency for the State in which an eligible
 residential property is located,
 `(ii) the Office of Community Investment (or other comparable division)
 within the Federal Housing Finance Board, and
 `(iii) any national nonprofit organizations (including any nonprofit entity
 established by the corporation established under title IX of the Housing
 and Community Development Act of 1968) that the Corporation determines has
 the capacity to act as a clearinghouse for information.
 `(C) CORPORATION- The term `Corporation' means the Resolution Trust
 Corporation either in its corporate capacity or as receiver, but does not
 include the Corporation in its capacity as an operating conservator.
 `(D) ELIGIBLE MULTIFAMILY HOUSING PROPERTY- The term `eligible multifamily
 housing property' means a property consisting of more than 4 dwelling units--
 `(i) to which the Corporation acquires title; and
 `(ii) that has an appraised value that does not exceed the applicable dollar
 amount set forth in section 221(d)(3)(ii) of the National Housing Act for
 elevator-type structures (without regard to any increase of such amount
 for high-cost areas).
 `(E) ELIGIBLE RESIDENTIAL PROPERTY- The term `eligible residential property'
 includes eligible single family properties and eligible multifamily housing
 properties.
 `(F) ELIGIBLE SINGLE FAMILY PROPERTY- The term `eligible single family
 property' means a 1- to 4-family residence (including a manufactured home)--
 `(i) to which the Corporation acquires title; and
 `(ii) that has an appraised value that does not exceed the applicable
 dollar amount set forth in the first sentence of section 203(b)(2) of the
 National Housing Act (without regard to any increase of such amount for
 high-cost areas).
 `(G) LOWER-INCOME FAMILIES- The term `lower-income families' means families
 and individuals whose incomes do not exceed 80 percent of the median income
 of the area involved, as determined by the Secretary, with adjustment for
 family size.
 `(H) NET REALIZABLE MARKET VALUE- The term `net realizable market value' means
 a price below the market value that takes into account (i) any reductions in
 holding costs resulting from the expedited sale of a property, including but
 not limited to foregone real estate taxes, insurance, maintenance costs,
 security costs, and loss of use of funds, and (ii) the avoidance, where
 applicable, of fees paid to real estate brokers, auctioneers, or other
 individuals or organizations involved in the sale of property owned by
 the Corporation.
 `(I) NONPROFIT ORGANIZATION- The term `nonprofit organization' means a
 private organization (including a limited equity cooperative)--
 `(i) no part of the net earnings of which inures to the benefit of any
 member, shareholder, founder, contributor, or individual; and
 `(ii) that is approved by the Corporation as to financial responsibility.
 `(J) PUBLIC AGENCY- The term `public agency'--
 `(i) means any Federal, State, local, or other governmental entity; and
 `(ii) includes any public housing agency.
 `(K) QUALIFYING HOUSEHOLD- The term `qualifying household' means a household
 (i) who intends to occupy eligible single family property as a principle
 residence; and (ii) whose adjusted income does not exceed 115 percent of the
 median income for the area, as determined by the Secretary, with adjustment
 for family size.
 `(L) QUALIFYING MULTIFAMILY PURCHASER- The term `qualifying multifamily
 purchaser' means (i) a public agency, (ii) a nonprofit organization, or
 (iii) a for-profit entity which makes a commitment (for itself or any related
 entity) to satisfy the lower-income occupancy requirements specified under
 paragraph (3)(E) for any eligible multifamily property for which an offer
 to purchase is made during or after the periods specified under paragraph (3).
 `(M) RURAL AREA- The term `rural area' has the meaning given such term in
 section 520 of the Housing Act of 1949.
 `(N) SECRETARY- The term `Secretary' means the Secretary of the Housing
 and Urban Development.
 `(O) STATE HOUSING FINANCE AGENCY- The term `State housing finance agency'
 means the public agency, authority, corporation, or other instrumentality
 of a State that has the authority to provide residential mortgage loan
 financing throughout such State.
 `(P) VERY LOW-INCOME FAMILIES- The term `very-low income families' means
 families and individuals whose incomes do not exceed 50 percent of the
 median income of the area involved, as determined by the Secretary, with
 adjustment for family size.
 `(10) EXCEPTION- The provisions of this subsection shall not apply whenever
 the Corporation as receiver contracts to sell all or substantially all of the
 assets of a closed savings association to an insured depository institution
 (as defined in section 3 of the Federal Deposit Insurance Act).
 `(11) Third party rights-
 `(A) IN GENERAL- The provisions of this subsection, or any failure by the
 Corporation to comply with such provisions, may not be used by any person to
 attack or defeat any title to property once it is conveyed by the Corporation.
 `(B) LOWER-INCOME OCCUPANCY- The lower-income occupancy requirements
 specified under paragraphs (2) and (3) shall be judicially enforceable against
 purchasers of property under this subsection or their successors in interest
 by affected very low- and lower-income families, State housing finance
 agencies, and any agency, corporation, or authority of the United States
 Government. The parties specified in the preceding sentence shall be entitled
 to reasonable attorney fees upon prevailing in any such judicial action.
 `(C) CLEARINGHOUSE- A clearinghouse shall not be subject to suit for its
 failure to comply with the requirements of this subsection.
 `(d) National and Regional Advisory Boards-
 `(1) National advisory board-
 `(A) ESTABLISHMENT- The Oversight Board shall establish a national advisory
 board to provide information to the Oversight Board, and to advise that
 Board on policies and programs for the sale or other disposition of real
 property assets of institutions which are described in subsection (b)(3)(A).
 `(B) MEMBERSHIP- The national advisory board shall consist of--
 `(i) a chairperson appointed by the Oversight Board; and
 `(ii) the chairpersons of any regional advisory boards established pursuant
 to paragraph (2).
 `(C) MEETINGS- The national advisory board shall meet 4 times a year,
 or more frequently if requested by the Corporation.
 `(2) Regional advisory boards-
 `(A) ESTABLISHMENT- The Oversight Board shall establish not less than
 6 regional advisory boards to advise the Corporation on the policies
 and programs for the sale or other disposition of real property assets of
 institutions described in subsection (b)(3)(A). Such regional advisory boards
 shall be established in any region where the Oversight Board determines that
 there exists a significant portfolio of real property assets of institutions
 which are described in subsection (b)(3)(A).
 `(B) Membership-
 `(i) APPOINTMENT- Each regional advisory board shall consist of 5
 members. Each member shall be appointed by the Oversight Board and shall
 serve at the pleasure of the Oversight Board. The members shall be selected
 from those residents of the region who will represent the views of low-
 and moderate-income consumers and small businesses, or who have knowledge
 and experience regarding business, financial, and real estate matters.
 `(ii) TERMS- Each member of a regional advisory board shall serve a term not
 to exceed 2 years, except that the Oversight Board may provide for classes
 of members so that the terms of not more than 3 members of any such board
 shall expire in any 1 year.
 `(C) MEETINGS- Each regional advisory board shall meet 4 times a year,
 or more frequently if requested by the Corporation. A regional advisory
 board shall conduct its meetings in its region.
 `(3) PROHIBITION ON COMPENSATION- Members of the national and regional
 advisory boards shall serve without compensation, except that such members
 shall be entitled to receive allowances in accordance with subchapter I of
 chapter 57 of title 5, United States Code, for necessary expenses of travel,
 lodging, and subsistence incurred in attending official meetings and other
 activities of the boards.
 `(4) Treatment as advisory committee and termination of national and regional
 advisory boards-
 `(A) FEDERAL ADVISORY COMMITTEE ACT- The national and regional advisory boards
 shall be subject to the provisions of the Federal Advisory Committee Act.
 `(B) TERMINATION- Notwithstanding the provisions of the Federal Advisory
 Committee Act, the national advisory board and any regional advisory board
 established pursuant to this subsection which is in existence on the date
 on which the Corporation terminates shall also terminate on such date.
 `(e) Institutions Organized by the Corporation-
 `(1) LIMITATIONS ON CERTAIN ACTIVITIES- All insured depository institutions
 (as defined in section 3 of the Federal Deposit Insurance Act) organized by
 the Corporation under this section shall, during the period such institutions
 are within the control of the Corporation, be subject to such limitations,
 restrictions, and conditions as determined by the Corporation with respect
 to the following activities:
 `(A) Growth of assets.
 `(B) Lending and borrowing activities.
 `(C) Asset acquisitions.
 `(D) Use of brokered deposits.
 `(E) Payment of deposit rates.
 `(F) Setting policy or credit standards.
 `(G) Capital standards.
 `(2) APPLICABILITY OF OTHER PROVISIONS OF LAW- Except as otherwise provided,
 all insured depository institutions (defined in section 3 of the Federal
 Deposit Insurance Act) organized by the Corporation shall--
 `(A) be subject to all laws and rules otherwise applicable to them as
 insured depository institutions, and
 `(B) shall be subject to the supervision of the appropriate Federal
 banking agency (as that term is defined in section 3 of the Federal Deposit
 Insurance Act).
 `(f) FADA- Before the end of the 180-day period beginning on the date of the
 enactment of the Financial Institutions Reform, Recovery, and Enforcement
 Act of 1989, the Corporation shall liquidate the Federal Asset Disposition
 Association.
 `(g) EXEMPTION FROM STATE AND LOCAL TAXATION- The Corporation and the
 Oversight Board, the capital, reserves, surpluses, and assets of the
 Corporation and the Oversight Board, and the income derived from such capital,
 reserves, surpluses, or assets shall be exempt from State, municipal, and
 local taxation except taxes on real estate held by the Corporation, according
 to its value as other similar property held by other persons is taxed.
 `(h) Guarantees of FSLIC-
 `(1) ASSUMPTION BY CORPORATION- On the date of the enactment of this
 section, the Corporation shall, by operation of law (and without further
 action by the Corporation, the Oversight Board, the Federal Housing Finance
 Board, the Federal Savings and Loan Insurance Corporation, or any court),
 assume all rights and obligations of the Federal Savings and Loan Insurance
 Corporation with respect to any guarantee issued by the Federal Savings and
 Loan Insurance Corporation during the period beginning on January 1, 1989,
 and ending on such date of enactment, in connection with any loan to any
 savings association by any Federal Reserve bank or Federal Home Loan Bank
 (hereinafter in this subsection referred to as a `lender').
 `(2) PAYMENT BY CORPORATION- Any obligation assumed by the Corporation for
 any guarantee described in paragraph (1) to any lender shall be paid by the
 Corporation before the end of the 1-year period beginning on the date of
 the enactment of this section. Payment shall be made from funds or assets
 available to the Corporation.
 `(3) PRIORITY OF CLAIMS OF LENDERS- Any claim by a lender with respect to any
 obligation assumed by the Corporation for a guarantee described in paragraph
 (1) shall have priority over all other secured or unsecured obligations of
 the Corporation.
 `(4) TREASURY BACKUP- If the resources of the Corporation are insufficient
 to pay all the obligations assumed by the Corporation under paragraph
 (1) within the 1-year period, the Secretary of the Treasury shall pay
 the amount of any such deficiency. There are hereby appropriated to the
 Secretary for fiscal year 1989 and each fiscal year thereafter, such sums
 as may be necessary to pay such deficiency.
 `(i) Borrowing-
 `(1) IN GENERAL- The Corporation, upon approval of the Oversight Board,
 is authorized to borrow from the Treasury. The Secretary of the Treasury
 is authorized and directed to loan to the Corporation, on such terms as
 may be fixed by the Secretary of the Treasury, an amount not exceeding in
 the aggregate $5,000,000,000 outstanding at any one time.
 `(2) INTEREST RATE- Each such loan shall bear interest at a rate determined
 by the Secretary of the Treasury, taking into consideration current market
 yields on outstanding marketable obligations of the United States of
 comparable maturities.
 `(j) Maximum Amount Limitations on Outstanding Obligations-
 `(1) IN GENERAL- Notwithstanding any other provision of this section,
 the amount which is equal to--
 `(A) the sum of--
 `(i) the total amount of contributions received from the Resolution Funding
 Corporation; and
 `(ii) the total amount of outstanding obligations of the Corporation; minus
 `(B) the sum of--
 `(i) the amount of cash held by the Corporation; and
 `(ii) the amount which is equal to 85 percent of the Corporation's estimate
 of the fair market value of other assets held by the Corporation,
may not exceed $50,000,000,000.
 `(2) OUTSTANDING OBLIGATION DEFINED- For purposes of this subsection (other
 than paragraph (3)), the term `outstanding obligation' includes--
 `(A) any obligation or other liability assumed by the Corporation from
 the Federal Savings and Loan Insurance Corporation under this section or
 pursuant to any provision of the Financial Institutions Reform, Recovery,
 and Enforcement Act of 1989;
 `(B) any guarantee issued by the Corporation;
 `(C) the total of the outstanding amounts borrowed from the Secretary of
 the Treasury pursuant to subsection (i); and
 `(D) any other obligation for which the Corporation has a direct or contingent
 liability to pay any amount.
 `(3) FULL FAITH AND CREDIT- The full faith and credit of the United States
 is pledged to the payment of any obligation issued by the Corporation,
 with respect to both principal and interest, if--
 `(i) the principal amount of such obligation is stated in the obligation; and
 `(ii) the term to maturity or the date of maturity of such obligation is
 stated in the obligation.
 `(4) Estimates of costs of contingent liabilities required-
 `(A) IN GENERAL- The Corporation shall--
 `(i) estimate the cost to such Corporation of any contingent liability of
 the Corporation; and
 `(ii) at least once each calendar quarter, make such adjustment as is
 appropriate in the estimate of such cost.
 `(B) INCLUSION IN FINANCIAL STATEMENTS AND OUTSTANDING OBLIGATIONS- The
 estimated amount of the cost to the Corporation of any contingent liability
 of the Corporation (taking into account the most recent adjustment to such
 estimate pursuant to paragraph (A)(ii)) shall be--
 `(i) treated as an outstanding obligation of the Corporation for purposes
 of this subsection; and
 `(ii) included in any financial statement of the Corporation.
 `(k) REPORTING AND DISCLOSURE OBLIGATIONS-
 `(1) AUDITS-
 `(A) ANNUAL AUDIT- The Comptroller General shall audit annually the financial
 statements of the Corporation in accordance with generally accepted government
 auditing standards unless the Comptroller General notifies the Oversight
 Board not later than 180 days before the close of a fiscal year that the
 Comptroller General will not perform such audit for that fiscal year. In
 the event of such notification, the Oversight Board shall contract with an
 independent certified public accountant to perform the annual audit of the
 Corporation's financial statement in accordance with generally accepted
 government auditing standards.
 `(B) ACCESS TO BOOKS AND RECORDS- All books, records, accounts, reports,
 files, and property belonging to or used by the Corporation, or the Oversight
 Board, or by an independent certified public accountant retained to audit
 the Corporation's financial statement, shall be made available to the
 Comptroller General.
 `(2) PUBLIC DISCLOSURE OF TRANSACTIONS-
 `(A) DISCLOSURE REQUIRED- Except as otherwise provided in this subsection,
 the Corporation shall make available to the public--
 `(i) any agreement entered into by the Corporation relating to a transaction
 for which the Corporation provides assistance pursuant to section 13(c)
 of the Federal Deposit Insurance Act, not later than 30 days after the
 first meeting of the Oversight Board after such agreement is entered into; and
 `(ii) all agreements relating to cases reviewed by the Corporation pursuant
 to subsection (b)(11)(B).
 `(B) EXCEPTION FOR DISCLOSURES AGAINST THE PUBLIC INTEREST-
 `(i) IN GENERAL- The Oversight Board may withhold from public disclosure
 any document or part of a document if the Oversight Board determines, by
 a unanimous affirmative vote of the members of the Board, that disclosure
 would be contrary to the public interest.
 `(ii) REPORT OF DETERMINATION- A written report shall be made of any
 determination by the Oversight Board to withhold any part of a document
 from public disclosure pursuant to clause (i). Such report shall contain
 a full explanation of the specific reasons for such determination.
 `(iii) PUBLICATION AND SUBMISSION OF REPORT- The report prepared pursuant
 to clause (ii) shall be--
 `(I) published in the Federal Register; and
 `(II) transmitted to the Committee on Banking, Finance and Urban Affairs
 of the House of Representatives and the Committee on Banking, Housing,
 and Urban Affairs of the Senate.
 `(C) AGREEMENT DEFINED- For purposes of this subsection, the term `agreement'
 includes--
 `(i) all documents which effectuate the terms and conditions of the assisted
 transaction;
 `(ii) a comparison, which the Corporation shall prepare of--
 `(I) the estimated cost of the transaction, with
 `(II) the estimated cost of liquidating the insured institution; and
 `(iii) a description of any economic or statistical assumptions on which
 such estimates are based.
 `(3) DISCLOSURE TO CONGRESS OF TRANSACTIONS-
 `(A) PROSPECTIVE TRANSACTIONS- The Corporation shall make available
 to the Committee on Banking, Finance and Urban Affairs of the House of
 Representatives and the Committee on Banking, Housing, and Urban Affairs
 of the Senate any agreement entered into by the Corporation relating to
 a transaction for which the Corporation provides assistance pursuant to
 section 13(c) of the Federal Deposit Insurance Act not later than 25 days
 after the first meeting of the Oversight Board after such agreement is entered
 into. The foregoing requirement is in addition to the Corporation's obligation
 to make such agreements publicly available pursuant to paragraph (2).
 `(B) PRIOR TRANSACTIONS- The Corporation shall submit a report to the
 Oversight Board and the Congress containing the results and conclusions
 of the review of the 1988 transactions conducted pursuant to subsection
 (b)(11)(B) and such recommendations for legislative action as the Corporation
 may determine to be appropriate.
 `(4) ANNUAL REPORTS-
 `(A) IN GENERAL- The Oversight Board and the Corporation shall annually
 submit a full report of their respective operations, activities, budgets,
 receipts, and expenditures for the preceding 12-month period.
 `(B) CONTENTS- The report required under subparagraph (A) shall include--
 `(i) audited statements and such information as is necessary to make known
 the financial condition and operations of the Corporation in accordance
 with generally accepted accounting principles;
 `(ii) the Corporation's financial operating plans and forecasts (including
 budgets, estimates of actual and future spending, and estimates of actual
 and future cash obligations) taking into account the Corporation's financial
 commitments, guarantees, and other contingent liabilities;
 `(iii) the number of minority and women investors participating in the
 bidding process for assisted acquisitions and the disposition of assets
 and the number of successful bids by such investors; and
 `(iv) a list of the properties sold to State housing finance authorities (as
 such term is defined in section 1301 of the Financial Institutions Reform,
 Recovery, and Enforcement Act of 1989), the individual purchase prices of
 such properties, and an estimate of the premium paid by such authorities
 for such properties.
 `(C) SUBMISSION TO CONGRESS AND THE PRESIDENT- The Corporation shall submit
 each annual report required under this subsection to the Congress and the
 President as soon as practicable after the end of the calendar year for
 which such report is made but not later than June 30 of the year following
 such calendar year.
 `(5) ADDITIONAL REPORTS-
 `(A) REPORTS REQUIRED- In addition to the annual report required under
 paragraph (4), the Oversight Board and the Corporation shall submit to
 Congress not later than April 30 and October 31 of each calendar year,
 a semiannual report on the activities and efforts of the Corporation,
 the Federal Deposit Insurance Corporation, and the Oversight Board for the
 6-month period ending on the last day of the month prior to the month in
 which such report is required to be submitted.
 `(B) CONTENTS OF REPORT- Each semiannual report required under subparagraph
 (A) shall include the following information with respect to the Corporation's
 assets and liabilities and to the assets and liabilities of institutions
 described in subsection (b)(3)(A):
 `(i) A statement of the total book value of all assets held or managed by
 the Corporation at the beginning and end of the reporting period.
 `(ii) A statement of the total book value of such assets which are under
 contract to be managed by private persons and entities at the beginning
 and end of the reporting period.
 `(iii) The number of employees of the Corporation, the Federal Deposit
 Insurance Corporation, and the Oversight Board at the beginning and end of
 the reporting period.
 `(iv) The total amounts expended on employee wages, salaries, and overhead,
 during such period which are attributable to--
 `(I) contracting with, supervising, or reviewing the performance of private
 contractors, or
 `(II) managing or disposing of such assets.
 `(v) A statement of the total amount expended on private contractors for
 the management of such assets.
 `(vi) A statement of the efforts of the Corporation to maximize the
 efficient utilization of the resources of the private sector during the
 reporting period and in future reporting periods and a description of the
 policies and procedures adopted to ensure adequate competition and fair and
 consistent treatment of qualified third parties seeking to provide services
 to the Corporation or the Federal Deposit Insurance Corporation.
 `(vii) The total book value and total proceeds from such assets disposed
 of during the reporting period.
 `(viii) Summary data on discounts from book value at which such assets were
 sold or otherwise disposed of during the reporting period.
 `(ix) A list of all of the areas that carried a distressed area designation
 during the reporting period (including a justification for removal of areas
 from or addition of areas to the list of distressed areas).
 `(x) An evaluation of market conditions in distressed areas and a description
 of any changes in conditions during the reporting period.
 `(xi) Any change adopted by the Oversight Board in a minimum disposition
 price and the reasons for such change.
 `(xii) The valuation method or methods adopted by the Oversight Board or
 the Corporation to value assets and the reasons for selecting such methods.
 `(6) APPEARANCES BEFORE CONGRESSIONAL COMMITTEES-
 `(A) SEMIANNUAL APPEARANCE REQUIRED- Not later than 30 days after submission
 of the semiannual reports required by paragraph (5), the Oversight Board
 shall appear before the Committee on Banking, Finance and Urban Affairs
 of the House of Representatives and the Committee on Banking, Housing,
 and Urban Affairs of the Senate to--
 `(i) report on the progress made during such period in resolving cases
 involving institutions described in subsection (b)(3)(A);
 `(ii) provide an estimate of the short-term and long-term cost to the United
 States Government of obligations issued or incurred during such period;
 `(iii) report on the progress made during such period in selling assets of
 institutions described in subsection (b)(3)(A) and the impact such sales
 are having on the local markets in which such assets are located;
 `(iv) describe the costs incurred by the Corporation in issuing obligations,
 managing and selling assets acquired by the Corporation;
 `(v) provide an estimate of the income of the Corporation from assets
 acquired by the Corporation;
 `(vi) provide an assessment of any potential source of additional funds
 for the Corporation; and
 `(vii) provide an estimate of the remaining exposure of the United States
 Government in connection with institutions described in subsection (b)(3)(A)
 which, in the Oversight Board's estimation, will require assistance or
 liquidation after the end of such period.
 `(7) Appearances concerning start-up of corporation-
 `(A) APPEARANCE REQUIRED- Before January 31, 1990, the Oversight Board and
 the Corporation shall appear before the Committee on Banking, Finance and
 Urban Affairs of the House of Representatives and the Committee on Banking,
 Housing, and Urban Affairs of the Senate for the purposes described in
 subparagraph (B).
 `(B) PURPOSES OF APPEARANCE- In connection with the appearance of the
 Oversight Board and the Corporation required by subparagraph (A), the
 Oversight Board and the Corporation shall--
 `(i) describe the strategic plan established for the operations of the
 Corporation;
 `(ii) describe the policies and procedures established or proposed to be
 established for the Corporation, including specific measures taken to avoid
 political favoritism or undue influence with respect to the activities of
 the Corporation;
 `(iii) provide any regulation proposed to be prescribed by the Corporation;
 and
 `(iv) provide the proposed case resolution schedule.
 `(l) Power to Remove; Jurisdiction-
 `(1) IN GENERAL- Notwithstanding any other provision of law, any civil action,
 suit, or proceeding to which the Corporation is a party shall be deemed to
 arise under the laws of the United States, and the United States district
 courts shall have original jurisdiction over such action, suit, or proceeding.
 `(2) CORPORATION AS PARTY- The Corporation shall be substituted as a
 party in any civil action, suit, or proceeding to which its predecessor
 in interest was a party with respect to institutions which are subject to
 the management agreement dated February 7, 1989, among the Federal Savings
 and Loan Insurance Corporation, the Federal Home Loan Bank Board and the
 Federal Deposit Insurance Corporation.
 `(3) REMOVAL AND REMAND- The Corporation may, without bond or security,
 remove any such action, suit, or proceeding from a State court to the United
 States District Court for the District of Columbia, or if the action, suit,
 or proceeding arises out of the actions of the Corporation with respect to
 an institution for which a conservator or a receiver has been appointed,
 the United States district court for the district where the institution's
 principal business is located. The removal of any action, suit, or proceeding
 shall be instituted--
 `(A) not later than 90 days after the date the Corporation is substituted
 as a party, or
 `(B) not later than 30 days after the date suit is filed against the
 Corporation, if such suit is filed after the date of enactment of the
 Financial Institutions Reform, Recovery, and Enforcement Act of 1989.
The Corporation may appeal any order of remand entered by a United States
district court.
 `(m) Intervention by Oversight Board in Extraordinary Circumstances-
 `(1) IN GENERAL- Notwithstanding any other provision of law, the Oversight
 Board has the ultimate authority to supervise the Corporation and is
 ultimately accountable for the administration of the Corporation. The
 Oversight Board is authorized to remove the Federal Deposit Insurance
 Corporation (or any replacement) from its position as exclusive manager of
 the Corporation and from all of its responsibilities and authorities to act
 for the Corporation, in any case where the Oversight Board determines that
 any of the following extraordinary events has occurred:
 `(A) There has been a material failure of the Corporation to adhere to the
 strategic plan developed pursuant to subsection (a)(14).
 `(B) There has been a material failure of the Corporation to meet its
 financial goals, including over-commitment of financial resources.
 `(C) There is evidence of fraud, abuse, gross mismanagement in the
 Corporation's programs or activities, or willful violation of this Act or
 the Corporation's policies or procedures.
 `(D) There is a continuing failure to obtain consideration at least nearly
 equivalent to the market value of the assets sold or otherwise transferred
 by the Corporation.
 `(2) PROCEDURE- Any decisions made or action taken by the Oversight Board
 under paragraph (1) shall be made or taken at an open meeting of the Oversight
 Board and the Oversight Board shall document its reasons for such actions
 or decisions.
 `(3) NOTIFICATION TO CONGRESS- Within 30 days of the meeting of the Oversight
 Board described in paragraph (2) and not later than 90 days before the removal
 of the Federal Deposit Insurance Corporation pursuant to paragraph (1), the
 Oversight Board shall notify Congress of any decision made or action taken
 pursuant to such paragraph and provide written documentation of its decision,
 including any supporting documentation relied on by the Oversight Board.
 `(n) OPERATION OF CORPORATION AFTER EXERCISE OF POWERS UNDER SUBSECTION
 (m)- If the Oversight Board exercises authority under subsection (m),
 the Oversight Board shall--
 `(1) develop an operations and management plan for the Corporation, including
 a detailed description of the employment and retention procedures for the
 Corporation and the classification standards for employment positions for
 the Corporation and the compensation rates and benefits established for
 each class of positions, all of which shall be subject to the provisions
 of subsection (a)(5);
 `(2) select a Board of Directors and a chief executive officer for the
 Corporation; and
 `(3) provide to Congress, not later than 60 days before the removal of
 the Federal Deposit Insurance Corporation, the operations and management
 plan developed pursuant to paragraph (1) and the identity of the Board of
 Directors and the chief executive officer selected pursuant to paragraph (2).
 `(o) TERMINATION-
 `(1) IN GENERAL- The Corporation shall terminate not later than December
 31, 1996. If at the time of its termination, the Corporation is acting as
 a conservator or receiver, the Federal Deposit Insurance Corporation shall
 succeed the Corporation as conservator or receiver.
 `(2) CASE RESOLUTIONS TRANSFERRED- Simultaneous with the termination of the
 Corporation as provided in paragraph (1), all assets and liabilities of the
 Corporation shall be transferred to the FSLIC Resolution Fund. Thereafter
 the FSLIC Resolution Fund shall transfer any net proceeds from the sale of
 assets to the Resolution Funding Corporation.
 `(p) Conflict of Interest-
 `(1) In general-
 `(A) The Oversight Board and the Corporation shall each be an `agency'
 for purposes of title 18, United States Code. Any individual who, pursuant
 to a contract or any other arrangement, performs functions or activities
 of the Oversight Board or the Corporation, under the direct supervision of
 an officer or employee of the Oversight Board or the Corporation, shall be
 deemed to be an employee of the Oversight Board or the Corporation for the
 purposes of title 18, United States Code and this Act.
 `(B) Any individual who, pursuant to a contract or any other agreement,
 acts for or on behalf of the Corporation shall be deemed to be a public
 official for the purposes of section 201 of title 18, United States Code.
 `(2) ESTABLISHMENT OF RULES- The Oversight Board and the Corporation shall,
 not later than 180 days after the date of enactment of this subsection,
 promulgate rules and regulations governing conflict of interest, ethical
 responsibilities, and post-employment restrictions applicable to members,
 officers, and employees of the Oversight Board and the Corporation that
 shall be no less stringent than those applicable to the Federal Deposit
 Insurance Corporation.
 `(3) USE OF CONFIDENTIAL INFORMATION- The Oversight Board and the Corporation
 shall, not later than 180 days after the date of enactment of this subsection,
 promulgate rules and regulations applicable to independent contractors
 governing conflicts of interest, ethical responsibilities, and the use of
 confidential information consistent with the goals and purposes of titles
 18 and 41, United States Code.
 `(4) POST EMPLOYMENT- The chief executive officer of the Corporation shall
 be prohibited for a period of 1 year after leaving the Corporation from
 holding any office, position, or employment with, or receiving remuneration
 from, a company (other than the Corporation) which, during the time the chief
 executive was employed by the Corporation, participated in any case resolution
 or contract with the Corporation for which such person was either responsible
 or in which such person was personally and substantially involved except that
 the chief executive officer may hold any office, position, or employment
 so long as the chief executive officer does not, during the 1-year period,
 provide advice with respect to, participate in decisions relating to, or
 otherwise provide assistance to such entity on the enumerated matters or
 receive remuneration with respect thereto from such company.
 `(5) OTHER AGENCY EMPLOYEES- Directors, officers, and employees of the
 Oversight Board and the Corporation who are also subject to the ethical rules
 of another agency or Government Corporation shall file with the Corporation
 a copy of any financial disclosure statement required by such other agency
 or corporation.
 `(6) DISAPPROVAL OF CONTRACTORS-
 `(A) IN GENERAL- The Oversight Board shall prescribe regulations establishing
 procedures for ensuring that any individual who is performing, directly
 or indirectly, any function or service on behalf of the Corporation meets
 minimum standards of competence, experience, integrity, and fitness.
 `(B) PROHIBITION FROM SERVICE ON BEHALF OF CORPORATION- The procedures
 established under subparagraph (A) shall provide that the Corporation shall
 prohibit any person who does not meet the minimum standards of competence,
 experience, integrity, and fitness from--
 `(i) entering into any contract with the Corporation; or
 `(ii) being employed by the Corporation or any person performing any service
 for or on behalf of the Corporation.
 `(C) INFORMATION REQUIRED TO BE SUBMITTED- The procedures established under
 subparagraph (A) shall require that any offer submitted to the Corporation
 by any person under this section and any employment application submitted
 to the Corporation by any person shall include--
 `(i) a list and description of any instance during the preceding 5 years
 in which the person or company under such person's control defaulted on a
 material obligation to an insured depository institution; and
 `(ii) such other information as the Board may prescribe by regulation.
 `(D) SUBSEQUENT SUBMISSIONS- No offer submitted to the Corporation may be
 accepted unless the offeror agrees that no person will be employed, directly
 or indirectly, by the offeror under any contract with the Corporation unless
 all applicable information described in subparagraph (C) with respect to
 any such person is submitted to the Corporation and the Corporation does
 not disapprove of the direct or indirect employment of such person. Any
 decision made by the Corporation pursuant to this paragraph shall be in
 its sole discretion and shall not be subject to review.
 `(E) PROHIBITION REQUIRED IN CERTAIN CASES- The standards established
 under subparagraph (A) shall require the Corporation to prohibit any person
 who has--
 `(i) been convicted of any felony,
 `(ii) been removed from, or prohibited from participating in the affairs of,
 any insured depository institution pursuant to any final enforcement action
 by any appropriate Federal banking agency,
 `(iii) demonstrated a pattern or practice of defalcation regarding obligations
 to insure depository institutions, or
 `(iv) caused a substantial loss to Federal deposit insurance funds,
from service on behalf of the Corporation.
 `(7) ABROGATION OF CONTRACTS- The Oversight Board or the Corporation may
 rescind any contract with a person who--
 `(A) fails to disclose a material fact to the Oversight Board or the
 Corporation,
 `(B) would be prohibited under paragraph (6) from providing services to,
 receiving fees from, or contracting with the Corporation or the Oversight
 Board, or
 `(C) has been subject to a final enforcement action by any Federal bank
 regulatory agency.
 `(8) PRIORITY OF OVERSIGHT BOARD RULES- To the extent that the rules
 established under this subsection conflict with rules of other agencies or
 Government corporations, officers, directors, employees, and independent
 contractors of the Corporation or the Oversight Board, who are also subject
 to the conflict of interest or ethical rules of another agency or Government
 corporation, shall be governed by the rules and regulations established by
 the Oversight Board under this subsection when acting for or on behalf of
 the Corporation.
 `(9) DEFINITIONS- For the purposes of this subsection--
 `(A) The term `company' has the same meaning as in section 2(b) of the Bank
 Holding Company Act of 1956.
 `(B) The term `control' has the same meaning given such term under regulations
 promulgated by the Federal Home Loan Bank Board with respect to savings and
 loan holding companies as in effect on the day before the date of enactment
 of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989.
 `(C) The term `Corporation' includes the Resolution Trust Corporation,
 the national advisory board, and the regional advisory boards.'.
 (b) Inspector General of the Corporation-
 (1) ESTABLISHMENT- Section 11 of the Inspector General Act of 1978 (5
 U.S.C. App.) is amended--
 (A) in paragraph (1), by inserting `the Oversight Board and the Board of
 Directors of the Resolution Trust Corporation' before `; as the case may
 be,'; and
 (B) in paragraph (2), by inserting `the Resolution Trust Corporation,'
 after `the Railroad Retirement Board,'.
 (2) Position at level iv of the executive schedule-
 (A) IN GENERAL- Section 5315 of title 5, United States Code, is amended by
 adding at the end thereof:
 `Inspector General, Resolution Trust Corporation.'.
 (B) APPROPRIATION- There is hereby authorized to be appropriated such sums
 as may be necessary for the operation of the Office of Inspector General
 established by the amendment made by paragraph (1) of this subsection.
 (c) CONFORMING AMENDMENTS TO TITLE 5- Section 5313 of title 5, United States
 Code, is amended by adding at the end thereof:
 `Independent Members, Oversight Board, Resolution Trust Corporation.'.
 (d) MIXED-OWNERSHIP GOVERNMENT CORPORATION- Section 9101(2) of title 31,
 United States Code, is amended by adding at the end thereof:
 `(L) the Resolution Trust Corporation.'.
 (e) CONFORMING AMENDMENTS TO URBAN HOMESTEADING PROGRAM AND HOUSING ACT
 OF 1949-
 (1) URBAN HOMESTEADING- Section 810(g) of the Housing and Community
 Development Act of 1974 (12 U.S.C. 1706e(g)) is amended by adding at the
 end the following new paragraph:
 `(3) The Secretary is authorized to reimburse the Resolution Trust
 Corporation, in an amount to be agreed upon by the Secretary and the
 Corporation, for property that the Corporation conveys to a unit of general
 local government, State, or agency for use in connection with an urban
 homesteading program approved by the Secretary.'.
 (2) HOUSING ACT OF 1949- Section 517 of the Housing Act of 1949 (42
 U.S.C. 1987) is amended by adding after subsection (m) the following new
 subsection:
 `(n) The Secretary may guarantee and service loans made for the purchase of
 eligible residential properties under section 21A(c) of the Federal Home
 Loan Bank Act in accordance with subsection (d) of this section and the
 last sentence of section 521(a)(1)(A).'.
 (f) GAO EXAMINATION OF CERTAIN FSLIC RESOLUTIONS- Notwithstanding any other
 provision of this Act, the Comptroller General of the United States shall
 examine and monitor all insolvent institution cases resolved by the Federal
 Savings and Loan Insurance Corporation from January 1, 1988, through the
 date of the enactment of this Act, and not later than April 30, 1990, shall
 report to Congress with an estimate of the costs of the agreements entered
 into by the Corporation pursuant to such resolutions. Not less than annually
 thereafter, the last report being due on April 30, 1992, the Comptroller
 General shall provide Congress with revisions to such estimates, to take into
 account any new information that he obtains with regard to such agreements.
Subtitle B--Resolution Funding Corporation
SEC. 511. RESOLUTION FUNDING CORPORATION ESTABLISHED.
 (a) IN GENERAL- The Federal Home Loan Bank Act (12 U.S.C. 1421 et seq.) is
 amended by inserting after section 21A the following new section:
`SEC. 21B. RESOLUTION FUNDING CORPORATION ESTABLISHED.
 `(a) PURPOSE- The purpose of the Resolution Funding Corporation is to
 provide funds to the Resolution Trust Corporation to enable the Resolution
 Trust Corporation to carry out the provisions of this Act.
 `(b) ESTABLISHMENT- There is established a corporation to be known as the
 Resolution Funding Corporation.
 `(c) MANAGEMENT OF FUNDING CORPORATION-
 `(1) DIRECTORATE- The Funding Corporation shall be under the management of
 a Directorate composed of 3 members as follows:
 `(A) The director of the Office of Finance of the Federal Home Loan Banks
 (or the head of any successor office).
 `(B) 2 members selected by the Oversight Board from among the presidents
 of the Federal Home Loan Banks.
 `(2) TERMS- Of the 2 members appointed under paragraph (1)(B), 1 shall be
 appointed for an initial term of 2 years and 1 shall be appointed for an
 initial term of 3 years. Thereafter, such members shall be appointed for
 a term of 3 years.
 `(3) VACANCY- If any member leaves the office in which such member was
 serving when appointed to the Directorate--
 `(A) such member's service on the Directorate shall terminate on the date
 such member leaves such office; and
 `(B) the successor to the office of such member shall serve the remainder
 of such member's term.
 `(4) EQUAL REPRESENTATION OF BANKS- No president of a Federal Home Loan
 Bank may be appointed to serve an additional term on the Directorate until
 such time as the presidents of each of the other Federal Home Loan Banks
 have served as many terms as the president of such bank.
 `(5) CHAIRPERSON- The Oversight Board shall select the chairperson of the
 Directorate from among the 3 members of the Directorate.
 `(6) STAFF-
 `(A) NO PAID EMPLOYEES- The Funding Corporation shall have no paid employees.
 `(B) POWERS- The Directorate may, with the approval of the Federal Housing
 Finance Board authorize the officers, employees, or agents of the Federal Home
 Loan Banks to act for and on behalf of the Funding Corporation in such manner
 as may be necessary to carry out the functions of the Funding Corporation.
 `(7) ADMINISTRATIVE EXPENSES-
 `(A) IN GENERAL- All administrative expenses of the Funding Corporation,
 including custodian fees, shall be paid by the Federal Home Loan Banks.
 `(B) PRO RATA DISTRIBUTION- The amount each Federal Home Loan Bank shall
 pay under subparagraph (A) shall be determined by the Oversight Board
 by multiplying the total administrative expenses for any period by the
 percentage arrived at by dividing--
 `(i) the aggregate amount the Oversight Board required such bank to
 invest in the Funding Corporation (as of the time of such determination)
 under paragraphs (4) and (5) of subsection (e) (computed without regard to
 paragraphs (3) or (6) of such subsection); by
 `(ii) the aggregate amount the Oversight Board required all Federal Home Loan
 Banks to invest (as of the time of such determination) under such paragraphs.
 `(8) REGULATION BY OVERSIGHT BOARD- The Directorate of the Funding Corporation
 shall be subject to such regulations, orders, and directions as the Oversight
 Board may prescribe.
 `(9) NO COMPENSATION FROM FUNDING CORPORATION- Members of the Directorate
 of the Funding Corporation shall receive no pay, allowance, or benefit from
 the Funding Corporation for serving on the Directorate.
 `(d) POWERS OF THE FUNDING CORPORATION- The Funding Corporation shall have
 only the powers described in paragraphs (1) through (9), subject to the other
 provisions of this section and such regulations, orders, and directions as
 the Oversight Board may prescribe:
 `(1) ISSUE STOCK- To issue nonvoting capital stock to the Federal Home
 Loan Banks.
 `(2) PURCHASE CAPITAL STOCK; TRANSFER AMOUNTS- To purchase capital
 certificates issued by the Resolution Trust Corporation under section 21A,
 and to transfer amounts to the Resolution Trust Corporation pursuant to
 subsection (e)(8) of this section.
 `(3) ISSUE OBLIGATIONS- To issue debentures, bonds, or other obligations,
 and to borrow, to give security for any amount borrowed, and to pay interest
 on (and any redemption premium with respect to) any such obligation or amount.
 `(4) IMPOSE ASSESSMENTS- To impose assessments in accordance with subsection
 (e)(7).
 `(5) CORPORATE SEAL- To adopt, alter, and use a corporate seal.
 `(6) SUCCESSION- To have succession until dissolved.
 `(7) CONTRACTS- To enter into contracts.
 `(8) AUTHORITY TO SUE- To sue and be sued in its corporate capacity, and
 to complain and defend in any action brought by or against the Funding
 Corporation in any State or Federal court of competent jurisdiction.
 `(9) INCIDENTAL POWERS- To exercise such incidental powers not inconsistent
 with the provisions of this section and section 21A as are necessary and
 appropriate to carry out the provisions of this section.
 `(e) CAPITALIZATION OF FUNDING CORPORATION, ETC-
 `(1) IN GENERAL-
 `(A) AMOUNT REQUIRED- The Oversight Board shall ensure that the aggregate
 of the amounts obtained under this subsection shall be sufficient so that--
 `(i) the Funding Corporation may transfer the amounts required under paragraph
 (8); and
 `(ii) the total of the face amounts (the amount of principal payable at
 maturity) of noninterest bearing instruments in the Funding Corporation
 Principal Fund are equal to the aggregate amount of principal on the
 obligations of the Funding Corporation.
 `(B) PURCHASES OF STOCK BY FEDERAL HOME LOAN BANKS- Each Federal Home Loan
 Bank shall purchase stock in the Funding Corporation at times and in amounts
 prescribed by the Oversight Board.
 `(2) PAR VALUE; TRANSFERABILITY- Each share of stock issued by the Funding
 Corporation to a Federal Home Loan Bank shall have a par value in an amount
 determined by the Oversight Board and shall be transferable at not less
 than par value only among the Federal Home Loan Banks in the manner and to
 the extent prescribed by the Oversight Board.
 `(3) MAXIMUM INVESTMENT AMOUNT LIMITATION FOR EACH FEDERAL HOME LOAN BANK-
 The cumulative amount of funds invested in nonvoting capital stock of the
 Funding Corporation by each Federal Home Loan Bank under paragraph (1) shall
 not at any time exceed the sum of the amounts calculated under subparagraphs
 (A) and (B), as adjusted in subparagraph (C), as follows:
 `(A) RESERVES AND UNDIVIDED PROFITS ON DECEMBER 31, 1988- The sum on December
 31, 1988, of--
 `(i) the reserves maintained by such Bank pursuant to the reserve requirement
 contained in the first 2 sentences of section 16 (as in effect on December
 31, 1988); and
 `(ii) the undivided profits of such Bank, minus the amounts invested in
 the capital stock of the Financing Corporation pursuant to section 21.
 `(B) SUBSEQUENT ADDITIONS TO RESERVES AND UNDIVIDED PROFITS- The amount,
 calculated until the date on which the Funding Corporation Principal Fund
 is fully funded, equal to--
 `(i) the sum of--
 `(I) the amounts added to reserves by such Bank after December 31, 1988,
 pursuant to the reserve requirement contained in the first 2 sentences of
 section 16 (as in effect on December 31, 1988); and
 `(II) the quarterly additions to undivided profits of the Bank after December
 31, 1988; minus
 `(ii) the amounts invested by such Bank in the capital stock of the Financing
 Corporation after December 31, 1988, pursuant to the requirement contained
 in section 21.
 `(C) ANNUAL ADJUSTMENT- The amounts in subparagraph (B) shall be adjusted
 as follows:
 `(i) INCREASE IN LIMIT- If the aggregate amount for all Federal Home Loan
 Banks determined under subparagraph (B)(i) is less than $300,000,000 per year,
 the limit for each Bank shall be increased by an amount determined by the
 Oversight Board by multiplying the aggregate deficiency by the percentage
 applicable to such Bank arrived at in the manner described in paragraph (5).
 `(ii) DECREASE IN LIMIT- If the aggregate amount for all Federal Home Loan
 Banks determined under subparagraph (B)(i) is more than $300,000,000 per
 year, the limit for each Bank shall be decreased by an amount determined by
 the Oversight Board by multiplying the aggregate excess by the percentage
 applicable to such Bank arrived at in the manner described in paragraph (5).
 `(4) PRO RATA DISTRIBUTION OF FIRST $1,000,000,000 INVESTED IN FUNDING
 CORPORATION BY FEDERAL HOME LOAN BANKS- Of the first $1,000,000,000 of the
 aggregate that the Federal Housing Finance Board (pursuant to section 21)
 or the Oversight Board (under this section) may require the Federal Home Loan
 Banks collectively to invest in the capital stock of the Financing Corporation
 or invest in the capital stock of the Funding Corporation, respectively,
 the amount which each Federal Home Loan Bank (or any successor to the Bank)
 shall invest shall be determined by the Federal Housing Finance Board or the
 Oversight Board (as the case may be) by multiplying the aggregate amount of
 such investment by all Banks by the percentage appearing in the following
 table for each such Bank:
Bank
--Percentage
 Federal Home Loan Bank of Boston
--1.8629
 Federal Home Loan Bank of New York
--9.1006
 Federal Home Loan Bank of Pittsburgh
--4.2702
 Federal Home Loan Bank of Atlanta
--14.4007
 Federal Home Loan Bank of Cincinnati
--8.2653
 Federal Home Loan Bank of Indianapolis
--5.2863
 Federal Home Loan Bank of Chicago
--9.6886
 Federal Home Loan Bank of Des Moines
--6.9301
 Federal Home Loan Bank of Dallas
--8.8181
 Federal Home Loan Bank of Topeka
--5.2706
 Federal Home Loan Bank of San Francisco
--19.9644
 Federal Home Loan Bank of Seattle
--6.1422
 `(5) PRO RATA DISTRIBUTION OF AMOUNTS REQUIRED TO BE INVESTED IN EXCESS
 OF $1,000,000,000- Of any amount which the Oversight Board may require the
 Federal Home Loan Banks to invest in capital stock of the Funding Corporation
 under this subsection in excess of the $1,000,000,000 amount referred to in
 paragraph (4), the amount which each Federal Home Loan Bank (or any successor
 to such Bank) shall invest shall be determined by the Oversight Board by
 multiplying the excess amount by the percentage arrived at by dividing--
 `(A) the sum of the total assets (as of the most recent December 31) held
 by all Savings Association Insurance Fund members which are members of such
 Bank; by
 `(B) the sum of the total assets (as of such date) held by all Savings
 Association Insurance Fund members which are members of a Federal Home
 Loan Bank.
 `(6) SPECIAL PROVISIONS RELATING TO MAXIMUM AMOUNT LIMITATIONS-
 `(A) IN GENERAL- If the amount of any Federal Home Loan Bank's allocation
 under paragraph (5) exceeds the maximum amount applicable with respect to such
 Bank (in this paragraph referred to as a `deficient Bank') under paragraph
 (3) at the time of such determination (in this paragraph referred to as the
 `excess amount')--
 `(i) the Oversight Board shall require each Federal Home Loan Bank that
 is not allocated an amount under paragraph (5) that exceeds its maximum
 under paragraph (3) (in this paragraph referred to as a `remaining Bank')
 to purchase stock in the Funding Corporation (in addition to the amount
 determined under paragraph (5) for such remaining Bank and subject to the
 maximum amount applicable with respect to such remaining Bank under paragraph
 (3) at the time of such determination) on behalf of the deficient Bank the
 amount determined under subparagraph (B);
 `(ii) the Oversight Board shall require the deficient Bank to subsequently
 reimburse the remaining Banks out of its net earnings (or reimbursements
 received from other Banks) in the manner described in subparagraphs (C)
 and (D); and
 `(iii) the requirements contained in subparagraph (D) relating to the
 use of net earnings shall apply to the deficient Bank until such Bank has
 reimbursed the remaining Banks for all of the excess amount.
 `(B) ALLOCATION OF EXCESS AMOUNT AMONG REMAINING FEDERAL HOME LOAN BANKS-
 `(i) IN GENERAL- The amount of stock each remaining Federal Home Loan
 Bank shall be required to purchase under subparagraph (A)(i) is the amount
 determined by the Oversight Board by multiplying the excess amount by the
 percentage arrived at by dividing--
 `(I) the cumulative amount of stock in the Funding Corporation purchased under
 this subsection by such remaining Bank at the time of such determination; by
 `(II) the aggregate of the cumulative amounts invested under this subsection
 by all remaining Banks at such time.
 `(ii) REALLOCATION- If the allocation under this subparagraph results in a
 remaining Bank exceeding its maximum amount under paragraph (3), such excess
 amount shall be reallocated to the other remaining Bank in accordance with
 this subparagraph.
 `(C) REIMBURSEMENT PROCEDURE-
 `(i) IN GENERAL- A Bank on whose behalf stock is purchased under subparagraph
 (A)(i) shall make payments annually from amounts, if any, in its reserve
 account (as described in subparagraph (D)) to each Bank that made payments on
 its behalf until a full reimbursement has been completed. A full reimbursement
 shall require repayment of the excess amounts invested by other Banks plus
 interest which shall accrue at a rate equal to the annual average cost of
 funds in the most recent year to all Federal Home Loan Banks and which
 shall begin to accrue 2 years after the investments under subparagraph
 (A)(i) are made.
 `(ii) DETERMINATION OF AMOUNTS- The Oversight Board shall annually determine
 the dollar amounts of such reimbursements by distributing the amount
 available for such reimbursements (at the time of such determination)
 from the reimbursing Bank to the Banks that made purchases on its behalf
 according to the shares of the reimbursing Bank's excess amount that the
 other Banks invested.
 `(D) TRANSFER TO ACCOUNT FOR REIMBURSEMENTS REQUIRED-
 `(i) IN GENERAL- Of the net earnings for any year of a Bank on whose behalf
 a purchase is made under subparagraph (A)(i) and any reimbursements received
 from other Banks, the amount necessary to make the reimbursements required
 under subparagraph (A)(ii) shall be placed in a reserve account (established
 in the manner prescribed by the Oversight Board), which shall be available
 only for such reimbursements.
 `(ii) LIMITATION- The total amount placed in such reserve account in any
 year by any Bank shall not exceed an amount equal to 20 percent of the net
 earnings of such Bank for such year.
 `(7) ADDITIONAL SOURCES- If each Federal Home Loan Bank has exhausted
 the amount applicable with respect to the Bank under paragraph (3) after
 purchases under paragraphs (4), (5), and (6), the amounts necessary to
 provide additional funding for the Funding Corporation Principal Fund shall
 be obtained from the following sources:
 `(A) ASSESSMENTS- The Funding Corporation, with the approval of the Board
 of Directors of the Federal Deposit Insurance Corporation, shall assess
 against each Savings Association Insurance Fund member an assessment (in
 the same manner as assessments are assessed against such members by the
 Federal Deposit Insurance Corporation pursuant to section 7 of the Federal
 Deposit Insurance Act) except that--
 `(i) the maximum amount of the aggregate amount assessed shall be the amount
 of additional funds necessary to fund the Funding Corporation Principal Fund;
 `(ii) the sum of--
 `(I) the amount assessed under this subparagraph; and
 `(II) the amount assessed by the Financing Corporation under section 21;
shall not exceed the amount authorized to be assessed against Savings
Association Insurance Fund members pursuant to section 7 of the Federal
Deposit Insurance Act;
 `(iii) the Financing Corporation shall have first priority to make the
 assessment; and
 `(iv) the amount of the applicable assessment determined under such section
 7 shall be reduced by the sum described in clause (ii) of this subparagraph.
 `(B) RECEIVERSHIP PROCEEDS- To the extent the amounts available pursuant to
 subparagraph (A) are insufficient to fund the Funding Corporation Principal
 Fund, the Federal Deposit Insurance Corporation shall transfer amounts to
 the Funding Corporation from the liquidating dividends and payments made
 on claims received by the FSLIC Resolution Fund from receiverships.
 `(8) TRANSFER TO RTC- The Funding Corporation shall transfer to the Resolution
 Trust Corporation $1,200,000,000 in fiscal year 1989.
 `(f) OBLIGATIONS OF FUNDING CORPORATION-
 `(1) ISSUANCE- The Funding Corporation may issue bonds, notes, debentures, and
 similar obligations in an aggregate amount not to exceed $30,000,000,000. No
 obligation may be issued under this paragraph unless, at the time of
 issuance, the face amounts (the amount of principal payable at maturity)
 of noninterest bearing instruments in the Funding Corporation Principal
 Fund are equal to the aggregate amount of principal on the obligations of
 the Funding Corporation that will be outstanding following such issuance.
 `(2) INTEREST PAYMENTS- The Funding Corporation shall pay the interest due
 on such obligations from funds obtained for such interest payments from
 the following sources:
 `(A) EARNINGS ON CERTAIN ASSETS- Earnings on assets of the Funding Corporation
 which are not invested in the Funding Corporation Principal Fund shall be
 used for interest payments on outstanding debt of the Funding Corporation.
 `(B) PROCEEDS FROM RESOLUTION TRUST CORPORATION- To the extent the amounts
 available pursuant to subparagraph (A) are insufficient to cover the amount
 of interest payments, the Resolution Trust Corporation shall pay to the
 Funding Corporation--
 `(i) the liquidating dividends and payments made on claims received by the
 Resolution Trust Corporation from receiverships to the extent such proceeds
 are determined by the Oversight Board to be in excess of funds presently
 necessary for resolution costs; and
 `(ii) any proceeds from warrants and participations acquired by the Resolution
 Trust Corporation.
 `(C) PAYMENTS BY FEDERAL HOME LOAN BANKS- To the extent the amounts available
 pursuant to subparagraphs (A) and (B) are insufficient to cover the amount
 of interest payments, the Federal Home Loan Banks shall pay to the Funding
 Corporation each calendar year the aggregate amount of $300,000,000 minus the
 amounts required in such year for Financing Corporation principal payments
 (pursuant to section 21) and the amounts required in such year by the Funding
 Corporation pursuant to subsection (e). Each Bank's individual share of any
 amounts required to be paid by the Banks under this subparagraph shall be
 determined as follows:
 `(i) AMOUNTS UP TO 20 PERCENT OF NET EARNINGS- Each Federal Home Loan Bank
 shall pay an equal percentage of its net earnings for the year for which such
 amount is required to be paid, up to a maximum of 20 percent of net earnings.
 `(ii) AMOUNTS IN EXCESS OF 20 PERCENT OF NET EARNINGS- If the aggregate amount
 required to be paid by the Federal Home Loan Banks under this subparagraph
 for any year exceeds 20 percent of the aggregate net earnings of the Banks
 for such year, each Bank shall pay 20 percent of its net earnings for such
 year as provided in clause (i), and each Bank's individual share of the
 excess of the required amount over 20 percent of the aggregate net earnings
 of the Banks for such year shall be determined by dividing--
 `(I) the average month-end level in the prior year of advances outstanding
 by such Bank to Savings Associations Insurance Fund members; by
 `(II) the average month-end level in the prior year of advances outstanding
 by all such Banks to Savings Associations Insurance Fund members.
 `(D) PROCEEDS FROM SALE OF ASSETS- To the extent the amounts available
 pursuant to subparagraphs (A), (B), and (C) are insufficient to cover the
 amount of interest payments, the FSLIC Resolution Fund shall transfer to
 the Funding Corporation any net proceeds from the sale of assets received
 from the Resolution Trust Corporation, which shall be used by the Funding
 Corporation to pay such interest.
 `(E) TREASURY BACKUP-
 `(i) IN GENERAL- To the extent the amounts available pursuant to subparagraphs
 (A), (B), (C), and (D) are insufficient to cover the amount of interest
 payments, the Secretary of the Treasury shall pay to the Funding Corporation
 the additional amount due, which shall be used by the Funding Corporation
 to pay such interest.
 `(ii) LIABILITY OF FUNDING CORPORATION- In each instance where the
 Secretary is required to make a payment under this subparagraph to the
 Funding Corporation, the amount of the payment shall become a liability
 of the Funding Corporation to be repaid to the Secretary upon dissolution
 of the Funding Corporation (to the extent the Funding Corporation may have
 any remaining assets).
 `(iii) APPROPRIATION OF FUNDS- There are hereby appropriated to the Secretary,
 for fiscal year 1989 and each fiscal year thereafter, such sums as may be
 necessary to carry out clause (i).
 `(3) PRINCIPAL PAYMENTS- On maturity of an obligation issued under this
 subsection, the obligation shall be repaid by the Funding Corporation from
 the liquidation of noninterest bearing instruments held in the Funding
 Corporation Principal Fund.
 `(4) PROCEEDS TO BE TRANSFERRED TO RESOLUTION TRUST CORPORATION- Subject to
 terms and conditions approved by the Oversight Board, the proceeds (less
 any discount, plus any premium, net of issuance costs) of any obligation
 issued by the Funding Corporation shall be used to--
 `(A) purchase the capital certificates issued by the Resolution Trust
 Corporation under section 21A; or
 `(B) refund any previously issued obligation the proceeds of which were
 transferred in the manner described in subparagraph (A).
 `(5) INVESTMENT OF UNITED STATES FUNDS IN OBLIGATIONS- Obligations issued
 under this section by the Funding Corporation, at the direction of the
 Oversight Board shall be lawful investments, and may be accepted as security,
 for all fiduciary, trust, and public funds the investment or deposit of
 which shall be under the authority or control of the United States or any
 officer of the United States.
 `(6) MARKET FOR OBLIGATIONS- All persons having the power to invest in,
 sell, underwrite, purchase for their own accounts, accept as security, or
 otherwise deal in obligations of the Federal Home Loan Banks shall also have
 the power to do so with respect to obligations of the Funding Corporation.
 `(7) TAX EXEMPT STATUS-
 `(A) IN GENERAL- Except as provided in subparagraph (B), obligations of
 the Funding Corporation shall be exempt from tax both as to principal and
 interest to the same extent as any obligation of a Federal Home Loan Bank
 is exempt from tax under section 13 of this Act.
 `(B) EXCEPTION- The Funding Corporation, like the Federal Home Loan Banks,
 shall be treated as an agency of the United States for purposes of the first
 sentence of section 3124(b) of title 31, United States Code (relating to
 determination of tax status of interest on obligations).
 `(8) OBLIGATIONS NOT EXEMPT SECURITIES-
 `(A) IN GENERAL- For purposes of the laws administered by the Securities
 and Exchange Commission, obligations of the Funding Corporation--
 `(i) shall not be considered to be securities issued or guaranteed by a
 person controlled or supervised by, or acting as an instrumentality of,
 the Government of the United States; and
 `(ii) shall not be considered to be `exempted securities' within the meaning
 of section 3(a)(12)(A)(i) of the Securities Exchange Act of 1934, except
 that such obligations shall be considered to be exempted securities for
 purposes of section 15 of such Act.
 `(B) AUTHORITY OF COMMISSION- Notwithstanding subparagraph (A), the Securities
 and Exchange Commission may, by rule or order, consistent with the public
 interest and the protection of investors, exempt securities issued by the
 Funding Corporation from the registration requirements of the Securities Act
 of 1933, subject to such terms and conditions as the Commission may prescribe.
 `(9) MINORITY PARTICIPATION IN PUBLIC OR NEGOTIATED OFFERINGS- The Oversight
 Board and the Directorate shall ensure that minority owned or controlled
 commercial banks, investment banking firms, underwriters, and bond counsels
 throughout the United States have an opportunity to participate to a
 significant degree in any public or negotiated offering of obligations
 issued under this section.
 `(10) NO FULL FAITH AND CREDIT OF THE UNITED STATES- Obligations of
 the Funding Corporation shall not be obligations of, or guaranteed as to
 principal by, the Federal Home Loan Bank System, the Federal Home Loan Banks,
 the United States, or the Resolution Trust Corporation and the obligations
 shall so plainly state. The Secretary shall pay interest on such obligations
 as required pursuant to this subsection.
 `(g) USE AND DISPOSITION OF ASSETS OF FUNDING CORPORATION NOT TRANSFERRED
 TO RESOLUTION TRUST CORPORATION-
 `(1) IN GENERAL- Subject to regulations, restrictions, and limitations
 prescribed by the Oversight Board, assets of the Funding Corporation
 which are not required to be invested in capital certificates issued by
 the Resolution Trust Corporation under section 21A and are not needed for
 current interest payments shall be invested in direct obligations of the
 United States issued by the Secretary.
 `(2) SEPARATE ACCOUNT FOR ZERO COUPON INSTRUMENTS HELD TO ENSURE PAYMENT OF
 PRINCIPAL- Except as provided in subsection (e)(8), the Funding Corporation
 shall invest amounts received pursuant to subsection (e) in, and hold in
 a separate account to be known as the Funding Corporation Principal Fund,
 noninterest bearing instruments--
 `(A) which are direct obligations of the United States issued by the
 Secretary; and
 `(B) the total of the face amounts (the amount of principal payable at
 maturity) of which is approximately equal to the aggregate amount of
 principal on the obligations of the Funding Corporation.
 `(h) MISCELLANEOUS PROVISIONS-
 `(1) TREATMENT FOR CERTAIN PURPOSES- Except as provided in subsection
 (f)(7)(B), the Funding Corporation shall be treated as a Federal Home Loan
 Bank for purposes of section 13 (to the extent such section relates to State,
 municipal, and local taxation) and section 23.
 `(2) FEDERAL RESERVE BANKS AS DEPOSITARIES AND FISCAL AGENTS- The Federal
 Reserve banks are authorized to act as depositaries for or fiscal agents
 or custodians of the Funding Corporation.
 `(3) APPLICABILITY OF CERTAIN PROVISIONS RELATING TO GOVERNMENT CORPORATIONS-
 The Funding Corporation shall be treated, for purposes of sections 9105,
 9107, and 9108 of title 31, United States Code, as a mixed-ownership
 Government corporation which has capital of the Government.
 `(4) JURISDICTION AND POWER TO REMOVE-
 `(A) FEDERAL COURT JURISDICTION- Notwithstanding any other provision of
 law, any civil action, suit, or proceeding to which the Funding Corporation
 is a party shall be deemed to arise under the laws of the United States,
 and the United States district courts shall have original jurisdiction over
 such action, suit, or proceeding.
 `(B) REMOVAL- The Funding Corporation may, without bond or security, remove
 any such action, suit, or proceeding from a State court to the United States
 District Court for the District of Columbia.
 `(i) ANNUAL REPORT-
 `(1) IN GENERAL- The Oversight Board shall annually submit a full report
 of the operations, activities, budget, receipts, and expenditures of the
 Funding Corporation for the preceding 12-month period.
 `(2) CONTENTS- The report required under paragraph (1) shall include--
 `(A) audited statements and any information necessary to make known the
 financial condition and operations of the Funding Corporation in accordance
 with generally accepted accounting principles;
 `(B) the financial operating plans and forecasts (including estimates
 of actual and future spending, and estimates of actual and future cash
 obligations) of the Funding Corporation taking into account its financial
 commitments, guarantees, and other contingent liabilities; and
 `(C) the results of the annual audit of the financial transactions of the
 Funding Corporation conducted by the Comptroller General pursuant to section
 9105(a) of title 31, United States Code.
 `(3) SUBMISSION TO CONGRESS AND PRESIDENT- The Oversight Board shall submit
 each annual report required under this subsection to the Congress and the
 President as soon as practicable after the end of the calendar year for
 which the report is made, but not later than June 30 of the year following
 such calendar year.
 `(j) TERMINATION OF FUNDING CORPORATION-
 `(1) IN GENERAL- The Funding Corporation shall be dissolved, as soon as
 practicable, after the maturity and full payment of all obligations issued
 by the Funding Corporation under this section.
 `(2) AUTHORITY OF OVERSIGHT BOARD TO CONCLUDE AFFAIRS OF FUNDING CORPORATION-
 Effective on the date of the dissolution of the Funding Corporation under
 paragraph (1), the Oversight Board may exercise on behalf of the Funding
 Corporation any power of the Funding Corporation which the Oversight
 Board determines to be necessary to settle and conclude the affairs of the
 Funding Corporation.
 `(k) DEFINITIONS- For purposes of this section:
 `(1) ADMINISTRATIVE EXPENSES- The term `administrative expenses' does
 not include--
 `(A) any interest on, or any redemption premium with respect to, any
 obligation of the Funding Corporation; or
 `(B) issuance costs.
 `(2) CUSTODIAN FEE- The term `custodian fee' means--
 `(A) any fee incurred by the Funding Corporation in connection with the
 transfer of any security to, or the maintenance of any security in, the
 segregated account established under subsection (g); and
 `(B) any other expense incurred by the Funding Corporation in connection
 with the establishment or maintenance of such account.
 `(3) FUNDING CORPORATION- The term `Funding Corporation' means the Resolution
 Funding Corporation established in subsection (b).
 `(4) FUNDING CORPORATION PRINCIPAL FUND- The term `Funding Corporation
 Principal Fund' means the separate account established under subsection
 (g)(2).
 `(5) ISSUANCE COSTS- The term `issuance costs'--
 `(A) means issuance fees and commissions incurred by the Funding Corporation
 in connection with the issuance or servicing of any obligation of the
 Funding Corporation; and
 `(B) includes legal and accounting expenses, trustee and fiscal and paying
 agent charges, costs incurred in connection with preparing and printing
 offering materials, and advertising expenses, to the extent that any such
 cost or expense is incurred by the Funding Corporation in connection with
 issuing any obligation.
 `(6) NET EARNINGS- The term `net earnings' means net earnings without
 reduction for chargeoffs or expenses incurred by a Federal Home Loan Bank
 for the purchase of capital stock of the Financing Corporation or payments
 relating to the Funding Corporation required by the Oversight Board under
 subsections (e) and (f).
 `(7) OVERSIGHT BOARD- The term `Oversight Board' means--
 `(A) the Oversight Board of the Resolution Trust Corporation under section
 21A; and
 `(B) after the termination of the Resolution Trust Corporation--
 `(i) the Secretary of the Treasury;
 `(ii) the Chairman of the Board of Governors of the Federal Reserve System;
 and
 `(iii) the Secretary of Housing and Urban Development.
 `(8) SAVINGS ASSOCIATION INSURANCE FUND MEMBER- The term `Savings Association
 Insurance Fund member' means a Savings Association Insurance member as such
 term is defined by section 7(l) of the Federal Deposit Insurance Act.
 `(9) SECRETARY- The term `Secretary' means the Secretary of the Treasury.
 `(10) UNDIVIDED PROFITS- The term `undivided profits' means earnings retained
 after dividends have been paid minus the sum of--
 `(A) that portion required to be added to reserves maintained pursuant to
 the first 2 sentences of section 16; and
 `(B) the dollar amounts held by the respective Federal Home Loan Banks in
 special dividend stabilization reserves on December 31, 1985, as determined
 by the table set forth in section 21(d)(7).
 `(l) REGULATIONS- The Oversight Board may prescribe any regulations necessary
 to carry out this section.'.
 (b) FUNDING CORPORATION AS MIXED-OWNERSHIP GOVERNMENT CORPORATION-
 (1) IN GENERAL- Section 9101(2) of title 31, United States Code, is amended
 by adding at the end the following new subparagraph:
 `(M) the Resolution Funding Corporation.'.
 (2) ANNUAL GAO AUDIT-
 (A) IN GENERAL- Section 9105(a)(2) of title 31, United States Code, is
 amended by adding at the end the following new sentence: `The Comptroller
 General shall audit the Resolution Funding Corporation annually.'.
 (B) CONFORMING AMENDMENT- Section 9105(a)(2) of title 31, United States Code,
 is amended by striking `Federal Savings and Loan Insurance Corporation and'.
SEC. 512. FINANCING CORPORATION.
 Section 21 of the Federal Home Loan Bank Act (12 U.S.C. 1441) is amended--
 (1) by striking `insured institution' each place it appears and inserting
 `Savings Association Insurance Fund member';
 (2) by striking `Federal Home Loan Bank Board' and `Board' each place they
 appear and inserting `Federal Housing Finance Board';
 (3) in subsection (c)(2), by inserting before the period the following: `prior
 to the date of the enactment of the Financial Institutions Reform, Recovery,
 and Enforcement Act of 1989 and thereafter to transfer the proceeds of any
 obligation issued by the Financing Corporation to the FSLIC Resolution Fund';
 (4) in subsection (c)(9) by striking `or section 402(b) of the National
 Housing Act';
 (5) by amending the portion of subsection (d)(4) appearing before the table
 to read as follows: `Of the first $1,000,000,000 in the aggregate which
 the Oversight Board pursuant to section 21B or the Federal Housing Finance
 Board under this section (as the case may be) may require the Federal Home
 Loan Banks collectively to invest in the stock of the Funding Corporation
 or invest in the capital stock of the Financing Corporation, respectively,
 the amount which each Federal Home Loan Bank (or any successor to such Bank)
 shall invest shall be determined by the Oversight Board or the Federal Housing
 Finance Board (as the case may be) by multiplying the aggregate amount of
 such payment or investment by all Banks by the percentage appearing in the
 following table for each such Bank:';
 (6) in subsection (d)(5), by striking `$1,000,000,000 which the Board'
 and inserting `the $1,000,000,000 amount referred to in paragraph (4)
 which the Federal Housing Finance Board';
 (7) in subsection (d)(6)(A)(iii), by striking `available for dividends';
 (8) in subsection (d)(6)(D), by striking `available for dividends';
 (9) in subsection (d)(6)(E), by striking `available for dividends';
 (10) by striking subsection (d)(6)(F) and adding at the end of subsection
 (l) the following:
 `(4) NET EARNINGS DEFINED- The term `net earnings' means net earnings without
 reduction for any chargeoffs or expenses incurred by a Bank in connection
 with the purchase of capital stock of the Financing Corporation or the
 purchase of stock of the Funding Corporation required by the Oversight
 Board under subsections (e) and (f) of section 21B.';
 (11) in subsection (e)(3)(A)--
 (A) by striking `used to';
 (B) by inserting `used to' before `purchase' and `refund'; and
 (C) by inserting before the semicolon the following: `prior to the enactment
 of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989,
 and thereafter transferred to the FSLIC Resolution Fund';
 (12) in subsection (e)--
 (A) by striking paragraph (2) and redesignating paragraphs (3) through (10)
 as paragraphs (2) through (9), respectively, and
 (B) in paragraph (6) as redesignated, by striking `the Federal Savings and
 Loan Insurance Corporation' and inserting `the FSLIC Resolution Fund';
 (13) by striking subsection (f) and inserting the following:
 `(f) SOURCES OF FUNDS FOR INTEREST PAYMENTS; FINANCING CORPORATION ASSESSMENT
 AUTHORITY- The Financing Corporation shall obtain funds for anticipated
 interest payments, issuance costs, and custodial fees on obligations issued
 hereunder from the following sources:
 `(1) PREENACTMENT ASSESSMENTS- The Financing Corporation assessments
 which were assessed on insured institutions pursuant to this section as in
 effect prior to the date of enactment of the Financial Institutions Reform,
 Recovery, and Enforcement Act of 1989.
 `(2) NEW ASSESSMENT AUTHORITY- To the extent the amounts available pursuant
 to paragraph (1) are insufficient to cover the amount of interest payments,
 issuance costs, and custodial fees, the Financing Corporation, with
 the approval of the Board of Directors of the Federal Deposit Insurance
 Corporation, shall assess against each Savings Association Insurance Fund
 member an assessment (in the same manner as assessments are assessed against
 such members by the Federal Deposit Insurance Corporation under section 7
 of the Federal Deposit Insurance Act), except that--
 `(A) the sum of--
 `(i) the amount assessed under this paragraph; and
 `(ii) the amount assessed by the Funding Corporation under section 21B;
shall not exceed the amount authorized to be assessed against Savings
Association Insurance Fund members pursuant to section 7 of the Federal
Deposit Insurance Act;
 `(B) the Financing Corporation shall have first priority to make the
 assessment; and
 `(C) the amount of the applicable assessment determined under such section
 7 shall be reduced by the sum described in subparagraph (A) of this paragraph.
 `(3) RECEIVERSHIP PROCEEDS- To the extent the amounts available pursuant
 to paragraphs (1) and (2) are insufficient to cover the amount of interest
 payments, issuance costs, and custodial fees, and if the funds are not
 required by the Resolution Funding Corporation to provide funds for the
 Funding Corporation Principal Fund under section 21B, the Federal Deposit
 Insurance Corporation shall transfer to the Financing Corporation, from
 the liquidating dividends and payments made on claims received by the
 FSLIC Resolution Fund (established under section 11A of the Federal Deposit
 Insurance Act) from receiverships, the remaining amount of funds necessary
 for the Financing Corporation to make interest payments.';
 (14) in subsection (g)(1) by striking `National Housing Act,' and inserting
 `National Housing Act before the date of enactment of the Financial
 Institutions Reform, Recovery, and Enforcement Act of 1989 and after such
 date in capital certificates issued by the FSLIC Resolution Fund,';
 (15) in subsection (g), by inserting the following at the end of paragraph
 (2): `For purposes of the foregoing, the Financing Corporation shall be
 deemed to hold noninterest bearing instruments that it lends temporarily to
 primary United States Treasury dealers in order to enhance market liquidity
 and facilitate deliveries: Provided, That United States Treasury securities
 of equal or greater value have been delivered as collateral.';
 (16) in subsection (j), by striking subparagraph (A) of paragraph (1)
 and inserting the following:
 `(A) the maturity and full payment of all obligations issued by the Financing
 Corporation pursuant to this section; or'; and
 (17) in subsection (l)--
 (A) by striking paragraph (1) and inserting the following:
 `(1) SAVINGS ASSOCIATION INSURANCE FUND MEMBER- The term `Savings
 Association Insurance Fund member' means a savings association which is
 a Savings Association Insurance Fund member as defined by section 7(l)
 of the Federal Deposit Insurance Act.'; and
 (B) by striking paragraph (2) and redesignating paragraphs (3) and (4)
 as paragraphs (2) and (3), respectively.
TITLE VI--THRIFT ACQUISITION ENHANCEMENT PROVISIONS
SEC. 601. ACQUISITION OF THRIFT INSTITUTIONS BY BANK HOLDING COMPANIES.
 (a) IN GENERAL- Section 4 of the Bank Holding Company Act of 1956 (12
 U.S.C. 1843) is amended by adding at the end the following new subsection:
 `(i) Acquisition of Savings Associations-
 `(1) IN GENERAL- The Board may approve an application by any bank holding
 company under subsection (c)(8) to acquire any savings association in
 accordance with the requirements and limitations of this section.
 `(2) PROHIBITION ON TANDEM RESTRICTIONS- In approving an application by a
 bank holding company to acquire a savings association, the Board shall not
 impose any restriction on transactions between the savings association and
 its holding company affiliates, except as required under sections 23A and
 23B of the Federal Reserve Act or any other applicable law.'.
 (b) MODIFICATION OF PRIOR APPROVALS- If the Board of Governors of the Federal
 Reserve System, in approving an application by a bank holding company to
 acquire a savings association, imposed any restriction that would have
 been prohibited under section 4(i)(2) of the Bank Holding Company Act of
 1956 (as added by subsection (a) of this section) if that section had been
 in effect when the application was approved, the Board shall modify that
 approval in a manner consistent with that section.
SEC. 602. TECHNICAL AMENDMENTS TO THE BANK HOLDING COMPANY ACT.
 (a) DEFINITIONS- Section 2(j) of the Bank Holding Company Act of 1956
 (12 U.S.C. 1841(j)) is amended to read as follows:
 `(j) DEFINITION OF SAVINGS ASSOCIATIONS AND RELATED TERM- The term `savings
 association' or `insured institution' means--
 `(1) any Federal savings association or Federal savings bank;
 `(2) any building and loan association, savings and loan association,
 homestead association, or cooperative bank if such association or cooperative
 bank is a member of the Savings Association Insurance Fund; and
 `(3) any savings bank or cooperative bank which is deemed by the Director of
 the Office of Thrift Supervision to be a savings association under section
 10(l) of the Home Owners' Loan Act.'.
 (b) INSURANCE REQUIRED- Section 3(e) of the Bank Holding Company Act of 1956
 (12 U.S.C. 1842(e)) is amended by striking `an insured bank as defined in
 section 3(h)' and inserting `an insured depository institution as defined
 in section 3'.
SEC. 603. PASSIVE INVESTMENTS BY COMPANIES CONTROLLING CERTAIN NONBANK BANKS.
 (a) IN GENERAL- Section 4(f)(2)(A)(ii) of the Bank Holding Company Act of
 1956 (12 U.S.C. 1843(f)(2)(A)(ii)) is amended to read as follows:
 `(ii) acquires control of more than 5 percent of the shares or assets of
 an additional bank or a savings association other than--
 `(I) shares held as a bona fide fiduciary (whether with or without the sole
 discretion to vote such shares);
 `(II) shares held by any person as a bona fide fiduciary solely for the
 benefit of employees of either the company described in paragraph (1)
 or any subsidiary of that company and the beneficiaries of those employees;
 `(III) shares held temporarily pursuant to an underwriting commitment in
 the normal course of an underwriting business;
 `(IV) shares held in an account solely for trading purposes;
 `(V) shares over which no control is held other than control of voting
 rights acquired in the normal course of a proxy solicitation;
 `(VI) loans or other accounts receivable acquired in the normal course
 of business;
 `(VII) shares or assets acquired in securing or collecting a debt previously
 contracted in good faith, during the 2-year period beginning on the date
 of such acquisition or for such additional time (not exceeding 3 years)
 as the Board may permit if the Board determines that such an extension will
 not be detrimental to the public interest;
 `(VIII) shares or assets of a savings association described in paragraph
 (10) or (12) of this subsection;
 `(IX) shares of a savings association held by any insurance company, as
 defined in section 2(a)(17) of the Investment Company Act of 1940, except
 as provided in paragraph (11); and
 `(X) shares issued in a qualified stock issuance under section 10(q) of
 the Home Owners' Loan Act;
except that the aggregate amount of shares held under this clause (other than
under subclauses (I), (II), (III), (IV), (V), and (VIII)) may not exceed
15 percent of all outstanding shares or of the voting power of a savings
association or savings and loan holding company; or'.
 (b) Technical Amendments-
 (1) Section 4(f)(10) of the Bank Holding Company Act of 1956 (12
 U.S.C. 1843(f)(10)) is amended--
 (A) by striking `and (ii)(V)' and inserting `and (ii)(VIII)'; and
 (B) in subparagraph (A), by inserting `or section 13(k) of the Federal
 Deposit Insurance Act' after `National Housing Act'.
 (2) Section 4(f) of the Bank Holding Company Act of 1956 (12 U.S.C. 1843(f))
 is amended by adding at the end the following:
 `(11) SHARES HELD BY INSURANCE AFFILIATES- Shares described in clause
 (ii)(IX) of paragraph (2)(A) shall not be excluded for purposes of clause
 (ii) of such paragraph if--
 `(A) all shares held under such clause (ii)(IX) by all insurance company
 affiliates of such savings association in the aggregate exceed 5 percent of
 all outstanding shares or of the voting power of the savings association; or
 `(B) such shares are acquired or retained with a view to acquiring,
 exercising, or transferring control of the savings association.'.
SEC. 604. PURCHASE OF MINORITY INTEREST IN UNDERCAPITALIZED SAVINGS
ASSOCIATIONS BY HOLDING COMPANIES ALLOWED.
 (a) AMENDMENT TO DEPOSITORY INSTITUTION MANAGEMENT INTERLOCKS ACT- Section
 205 of the Depository Institution Management Interlocks Act (12 U.S.C. 3204)
 is amended by adding at the end thereof the following new paragraph:
 `(9) Any savings association (as defined in section 10(a)(1)(A) of the
 Home Owners' Loan Act or any savings and loan holding company (as defined
 in section 10(a)(1)(D) of such Act) which has issued stock in connection
 with a qualified stock issuance pursuant to section 10(q) of such Act,
 except that this paragraph shall apply only with respect to service as a
 single management official of such savings association or holding company,
 or any subsidiary of such savings association or holding company, by a
 single management official of the savings and loan holding company which
 purchased the stock issued in connection with such qualified stock issuance,
 and shall apply only when the Director of the Office of Thrift Supervision
 has determined that such service is consistent with the purposes of this
 Act and the Home Owners' Loan Act.'.
 (b) AMENDMENTS TO BANK HOLDING COMPANY ACT- Section 4(f) of the Bank Holding
 Company Act of 1956 (12 U.S.C. 1843(f)) is amended--
 (1) by adding at the end thereof the following new paragraphs:
 `(12) EXEMPTION UNAFFECTED BY CERTAIN OTHER ACQUISITIONS- For purposes of
 clauses (i) and (ii)(VIII) of paragraph (2)(A), an insured institution
 is described in this paragraph if the insured institution was acquired
 (or any shares or assets of such institution were acquired) by a company
 described in paragraph (1)--
 `(A) from the Resolution Trust Corporation, the Federal Deposit Insurance
 Corporation, or the Director of the Office of Thrift Supervision, in any
 capacity; or
 `(B) in an acquisition in which the insured institution has been found to
 be in danger of default (as defined in section 3 of the Federal Deposit
 Insurance Act) by the appropriate Federal or State authority.
 `(13) SPECIAL RULE RELATING TO SHARES ACQUIRED IN A QUALIFIED STOCK ISSUANCE-
 A company described in paragraph (1) that holds shares issued in a qualified
 stock issuance pursuant to section 10(q) of the Home Owners' Loan Act by any
 savings association or savings and loan holding company (neither of which
 is a subsidiary) shall not be deemed to control such savings association
 or savings and loan holding company solely because such company holds such
 shares unless--
 `(A) the company fails to comply with any requirement or condition imposed
 by paragraph (2)(A)(ii)(X) or section 10(q) of the Home Owners' Loan Act
 with respect to such shares; or
 `(B) the shares are acquired or retained with a view to acquiring, exercising,
 or transferring control of the savings association or savings and loan
 holding company.'; and
 (2) in clause (i) of paragraph (2)(A), by striking out `paragraph (10)'
 and inserting in lieu thereof `paragraph (10) or (12)'.
TITLE VII--FEDERAL HOME LOAN BANK SYSTEM REFORMS
Subtitle A--Federal Home Loan Bank Act Amendments
SEC. 701. DEFINITIONS.
 (a) IN GENERAL- Section 2 of the Federal Home Loan Bank Act (12 U.S.C. 1422)
 is amended--
 (1) by striking paragraphs (1) and (2) and inserting the following:
 `(1) BOARD- The term `Board' means the Federal Housing Finance Board
 established under section 2A.
 `(2)(A) BANK- The term `Federal Home Loan Bank' or `Bank' means a bank
 established under the authority of the Federal Home Loan Bank Act.
 `(B) BANK SYSTEM- The term `Federal Home Loan Bank System' means the Federal
 Home Loan Banks under the supervision of the Board.';
 (2) in paragraph (4) by striking `(except when used in reference to the
 member of the Board)'; and
 (3) by striking paragraph (9) and adding at the end the following:
 `(9) SAVINGS ASSOCIATION- The term `savings association' has the meaning
 given to such term in section 3 of the Federal Deposit Insurance Act.
 `(10) CHAIRPERSON- The term `Chairperson' means the Chairperson of the Board.
 `(11) SECRETARY- The term `Secretary' means the Secretary of Housing and
 Urban Development.
 `(12) INSURED DEPOSITORY INSTITUTION- The term `insured depository
 institution' means--
 `(A) an insured depository institution (as defined in section 3 of the
 Federal Deposit Insurance Act), and
 `(B) except as used in sections 21A and 21B, an insured credit union (as
 defined in section 101 of the Federal Credit Union Act).'.
 (b) Change in Terms-
 (1) IN GENERAL- Except as otherwise specifically provided in this title,
 the Federal Home Loan Bank Act is amended by striking `board' (other than in
 section 7) and `Federal Home Loan Bank Board' each place such terms appear
 and inserting `Board'.
 (2) CHAIRPERSON- The Federal Home Loan Bank Act is amended by striking
 `Chairman' and `chairman' each place such terms appear and inserting
 `Chairperson' and `chairperson'.
 (3) Exceptions-
 (A) GENERAL RULE- The amendments made by paragraph (1) shall not apply to
 sections 18(c), 21A, and 21B of the Federal Home Loan Bank Act.
 (B) CONFORMING AMENDMENT- Section 18(c) of the Federal Home Loan Bank Act
 (12 U.S.C. 1438(c)) is amended by striking `Federal Home Loan Bank Board'
 and `board' each place such terms appear and inserting `Director of the
 Office of Thrift Supervision'.
 (c) TECHNICAL AMENDMENTS- Section 11 of the Federal Home Loan Bank Act
 (12 U.S.C. 1431) is amended--
 (1) in subsection (e)(2)(C), by inserting `Federal Home Loan' before
 `Banks,'; and
 (2) in the first sentence of the third paragraph of subsection (i) by
 inserting `Federal' before `Home Loan Bank System'.
SEC. 702. FEDERAL HOUSING FINANCE BOARD ESTABLISHED.
 (a) IN GENERAL- The Federal Home Loan Bank Act (12 U.S.C. 1421 et seq.) is
 amended by inserting after section 2 the following new sections:
`SEC. 2A. FEDERAL HOUSING FINANCE BOARD.
 `(a) Establishment-
 `(1) IN GENERAL- There is established the Federal Housing Finance Board,
 which shall succeed to the authority of the Federal Home Loan Bank Board
 with respect to the Federal Home Loan Banks.
 `(2) STATUS- The Board shall be an independent agency in the executive
 branch of the Government.
 `(3) DUTIES- The duties of the Board shall be--
 `(A) to supervise the Federal Home Loan Banks,
 `(B) to ensure that the Federal Home Loan Banks carry out their housing
 finance mission,
 `(C) to ensure the Federal Home Loan Banks remain adequately capitalized
 and able to raise funds in the capital markets, and
 `(D) to ensure the Federal Home Loan Banks operate in a safe and sound manner.
 `(b) Management-
 `(1) IN GENERAL- The management of the Board shall be vested in a Board of
 Directors consisting of 5 directors as follows:
 `(A) The Secretary who shall serve without additional compensation.
 `(B) Four citizens of the United States, appointed by the President, by and
 with the advice and consent of the Senate, each of whom shall hold office
 for a term of 7 years.
 `(2) Provisions relating to appointed directors-
 `(A) IN GENERAL- The directors appointed pursuant to paragraph (1)(B) shall
 be from among persons with extensive experience or training in housing
 finance or with a commitment to providing specialized housing credit. An
 appointed director shall not hold any other appointed office during his or
 her term as director. Not more than 3 directors shall be members of the same
 political party. Not more than 1 appointed director shall be from any single
 district of the Federal Home Loan Bank System. Nominations pursuant to this
 subparagraph shall be referred in the Senate to the Committee on Banking,
 Housing, and Urban Affairs.
 `(B) CONSUMER REPRESENTATIVE- At least 1 director shall be chosen from an
 organization with more than a 2-year history of representing consumer or
 community interests on banking services, credit needs, housing, or financial
 consumer protections.
 `(C) LIMITATIONS ON CONFLICTS OF INTEREST- No director may--
 `(i) serve as a director or officer of any Federal Home Loan Bank or any
 member of any Bank; or
 `(ii) hold shares of, or any other financial interest in, any member of
 any such Bank.
 `(3) INITIAL TERMS- Notwithstanding paragraph (2), of the directors first
 appointed--
 `(A) one shall be appointed for a term of 1 year;
 `(B) one shall be appointed for a term of 3 years; and
 `(C) one shall be appointed for a term of 5 years.
 `(c) Chairperson; Transitional Provisions-
 `(1) IN GENERAL- The President shall designate 1 of the appointed directors
 to be the Chairperson of the Board. The Chairperson shall designate another
 director to serve as Acting Chairperson during the absence or disability
 of the Chairperson.
 `(2) TRANSITIONAL PROVISION- Beginning on the date of enactment of the
 Financial Institutions Reform, Recovery, and Enforcement Act of 1989, until
 such time that at least 2 directors are appointed and confirmed pursuant to
 subsection (b), the Secretary shall act for all purposes and with the full
 powers of the Board of Directors. The Secretary may utilize the services of
 employees from the Department of Housing and Urban Development to perform
 services for the Board of Directors during such transition period.
 `(d) Vacancies-
 `(1) IN GENERAL- Any vacancy on the Board of Directors shall be filled
 in the manner in which the original appointment was made. Any director
 appointed to fill a vacancy occurring before the expiration of the term
 for which such director's predecessor was appointed shall be appointed only
 for the remainder of such term. Each director may continue to serve until
 a successor has been appointed and qualified.
 `(2) THE SECRETARY- In the event of a vacancy in the office of Secretary
 or during the absence or disability of the Secretary, the Acting Secretary
 shall act as a director in place of the Secretary.
`SEC. 2B. POWERS AND DUTIES.
 `(a) GENERAL POWERS- The Board shall have the following powers:
 `(1) To supervise the Federal Home Loan Banks and to promulgate and enforce
 such regulations and orders as are necessary from time to time to carry
 out the provisions of this Act.
 `(2) To suspend or remove for cause a director, officer, employee, or agent
 of any Federal Home Loan Bank or joint office. The cause of such suspension
 or removal shall be communicated in writing to such director, officer,
 employee, or agent and to such Bank or joint office. Notwithstanding any
 other provision of this Act, no officer, employee, or agent of a Bank or
 joint office shall be a Federal officer or employee under any definition
 of either term in title 5, United States Code.
 `(3) To determine necessary expenditures of the Board under this Act and
 the manner in which such expenditures shall be incurred, allowed, and paid.
 `(4) To use the United States mails in the same manner and under the same
 conditions as a department or agency of the United States.
 `(b) Staff-
 `(1) BOARD STAFF- Subject to title IV of the Financial Institutions Reform,
 Recovery, and Enforcement Act of 1989, the Board may employ, direct, and
 fix the compensation and number of employees, attorneys, and agents of
 the Federal Housing Finance Board, except that in no event shall the Board
 delegate any function to any employee, administrative unit of any Bank, or
 joint office of the Federal Home Loan Bank System. The prohibition contained
 in the preceding sentence shall not apply to the delegation of ministerial
 functions including issuing consolidated obligations pursuant to section
 11(b). In directing and fixing such compensation, the Board shall consult
 with and maintain comparability with the compensation at the Federal bank
 regulatory agencies. Such compensation shall be paid without regard to the
 provisions of other laws applicable to officers or employees of the United
 States, except the Chairperson and other Directors shall be compensated
 as prescribed in sections 5314 and 5315 of title 5, United States Code,
 respectively.
 `(2) ABOLITION OF JOINT OFFICES- The joint or collective offices of the
 Federal Home Loan Bank System, except for the Office of Finance, are hereby
 abolished.
 `(c) RECEIPTS OF THE BOARD- Receipts of the Board derived from assessments
 levied upon the Federal Home Loan Banks and from other sources (other
 than receipts from the sale of consolidated Federal Home Loan Bank bonds
 and debentures issued under section 11 of this Act) shall be deposited
 in the Treasury of the United States. Salaries of the directors and other
 employees of the Board and all other expenses thereof may be paid from such
 assessments or other sources and shall not be construed to be Government
 Funds or appropriated monies, or subject to apportionment for the purposes
 of chapter 15 of title 31, United States Code, or any other authority.
 `(d) ANNUAL REPORT- The Board shall make an annual report to the Congress.'.
 (b) AUDITS AND REPORTS- Section 20 of the Federal Home Loan Bank Act (12
 U.S.C. 1440) is amended by adding at the end the following: `In addition to
 such examinations, the Comptroller General may audit or examine the Board
 and the Banks, to determine the extent to which the Board and the Banks
 are fairly and effectively fulfilling the purposes of this Act.'.
 (c) APPOINTMENT OF INSPECTOR GENERAL- Section 8E(a)(2) of the Inspector
 General Act of 1978 (5 U.S.C. App.) is amended by striking `Federal Home
 Loan Bank Board,' and inserting `Federal Housing Finance Board,'.
SEC. 703. TERMINATION OF THE FEDERAL HOME LOAN BANK BOARD.
 (a) IN GENERAL- Section 17 of the Federal Home Loan Bank Act (12 U.S.C. 1437)
 is hereby repealed.
SEC. 704. ELIGIBILITY FOR MEMBERSHIP.
 (a) INSURED DEPOSITORY INSTITUTIONS- Section 4(a) of the Federal Home Loan
 Bank Act (12 U.S.C. 1424(a)) is amended to read as follows:
 `(a) Criteria for Eligibility-
 `(1) IN GENERAL- Any building and loan association, savings and loan
 association, cooperative bank, homestead association, insurance company,
 savings bank, or any insured depository institution (as defined in section
 2 of this Act), shall be eligible to become a member of a Federal Home Loan
 Bank if such institution--
 `(A) is duly organized under the laws of any State or of the United States;
 `(B) is subject to inspection and regulation under the banking laws, or
 under similar laws, of the State or of the United States; and
 `(C) makes such home mortgage loans as, in the judgment of the Board, are
 long-term loans (except that in the case of a savings bank, this subparagraph
 applies only if, in the judgment of the Board, its time deposits, as defined
 in section 19 of the Federal Reserve Act, warrant its making such loans).
 `(2) QUALIFIED THRIFT LENDER- An insured depository institution that is
 not a member on January 1, 1989, may become a member of a Federal Home Loan
 Bank only if--
 `(A) the insured depository institution has at least 10 percent of its
 total assets in residential mortgage loans;
 `(B) the insured depository institution's financial condition is such that
 advances may be safely made to such institution; and
 `(C) the character of its management and its home-financing policy are
 consistent with sound and economical home financing.
An insured depository institution commencing its initial business operations
after January 1, 1989, may become a member of a Federal Home Loan Bank if
it complies with regulations and orders prescribed by the Board for the 10
percent asset requirement (described in the preceding sentence) within one
year after the commencement of its operations.'.
 (c) REPEAL OF SECTION 27- Section 27 of the Federal Home Loan Bank Act
 (12 U.S.C. 1447) is hereby repealed.
SEC. 705. REPEAL OF PROVISION RELATING TO RATE OF INTEREST ON DEPOSITS.
 Section 5B of the Federal Home Loan Bank Act (12 U.S.C. 1425b) is hereby
 repealed.
SEC. 706. CAPITAL STOCK.
 Section 6 of the Federal Home Loan Bank Act (12 U.S.C. 1426) is amended--
 (1) by striking subsections (a), (e), (f), and (g) and redesignating
 subsections (b), (c), (d), (h), (i), (j), (k), and (m) as subsections (a),
 (b), (c), (d), (e), (f), (g), and (h), respectively;
 (2) by striking the second sentence of subsection (e) (as redesignated by
 paragraph (1) of this section) and inserting the following: `If any member's
 membership in a Federal Home Loan Bank is terminated, the indebtedness of
 such member to the Federal Home Loan Bank shall be liquidated in an orderly
 manner (as determined by the Federal Home Loan Bank), and upon completion of
 such liquidation, the capital stock in the Federal Home Loan Bank owned by
 such member shall be surrendered and canceled. Any such liquidation shall
 be deemed a prepayment of any such indebtedness, and shall be subject to
 any penalties or other fees applicable to such prepayment.'; and
 (3) in subsection (h) (as redesignated by paragraph (1) of this section), by
 striking `charter' and all that follows through the end period and inserting
 `charter as a Federal savings association (as defined in section 3 of the
 Federal Deposit Insurance Act).'.
SEC. 707. ELECTION OF BANK DIRECTORS.
 Section 7 of the Federal Home Loan Bank Act (12 U.S.C. 1427) is amended--
 (1) in subsection (a)--
 (A) by striking `appointed by the Federal Home Loan Bank Board referred to
 in subsection (b) of section 17, hereinafter in this section referred to as
 the Board' and inserting `appointed by the Board referred to in section 2A',
 (B) by inserting after the last sentence the following: `At least 2 of the
 Federal Home Loan Bank directors who are appointed by the Board shall be
 representatives chosen from organizations with more than a 2-year history
 of representing consumer or community interests on banking services,
 credit needs, housing, or financial consumer protections. No Federal Home
 Loan Bank director who is appointed pursuant to this subsection may, during
 such Bank director's term of office, serve as an officer of any Federal Home
 Loan Bank or a director or officer of any member of a Bank, or hold shares,
 or any other financial interest in, any member of a Bank.';
 (2) by inserting after the first sentence of subsection (b) the following:
 `No person who is an officer or director of a member that fails to meet any
 applicable capital requirement is eligible to hold the office of Federal
 Home Loan Bank director.';
 (3) by amending subsection (f) to read as follows:
 `(f) Vacancies-
 `(1) IN GENERAL- A Bank director appointed or elected to fill a vacancy shall
 be appointed or elected for the unexpired term of his or her predecessor
 in office.
 `(2) APPOINTED BANK DIRECTORS- In the event of a vacancy in any appointive
 Bank directorship, such vacancy shall be filled through appointment by the
 Board for the unexpired term. If any appointive Bank director shall cease
 to have the qualifications set forth in subsection (a), the office held by
 such person shall immediately become vacant, but such person may continue
 to act as a Bank director until his or her successor assumes the vacated
 office or the term of such office expires, whichever occurs first.
 `(3) ELECTED BANK DIRECTORS- In the event of a vacancy in any elective
 Bank directorship, such vacancy shall be filled by an affirmative vote
 of a majority of the remaining Bank directors, regardless of whether
 such remaining Bank directors constitute a quorum of the Bank's board of
 directors. A Bank director so elected shall satisfy the requirements for
 eligibility which were applicable to his predecessor. If any elective Bank
 director shall cease to have any qualification set forth in this section,
 the office held by such person shall immediately become vacant, and such
 person shall not continue to act as a Bank director.'; and
 (4) by adding at the end the following new subsection:
 `(k) INDEMNIFICATION OF DIRECTORS, OFFICERS, AND EMPLOYEES- The board of
 directors of each Bank shall determine the terms and conditions under which
 such Bank may indemnify its directors, officers, employees or agents.'.
SEC. 708. REPEAL OF PROVISIONS RELATING TO CERTAIN POWERS OF THE FEDERAL
HOME LOAN BANK BOARD.
 Section 19 of the Federal Home Loan Bank Act (12 U.S.C. 1439) is hereby
 repealed.
SEC. 709. POWERS AND DUTIES OF BANKS.
 Section 11 of the Federal Home Loan Bank Act (12 U.S.C. 1431) is amended--
 (1) in subsection (e)(1), by inserting `incidental to activities' after `not';
 (2) in subsection (f), by striking out `or whenever in the judgment of at
 least 4 members of the board an emergency exists requiring such action';
 (3) by amending subsection (k) to read as follows:
 `(k) Bank Loans to SAIF-
 `(1) LOANS AUTHORIZED- Subject to paragraph (3), the Federal Home Loan Banks
 may, upon the request of the Federal Deposit Insurance Corporation, make loans
 to such Corporation for the use of the Savings Association Insurance Fund.
 `(2) LIABILITY OF THE FUND- Any loan by a Federal Home Loan Bank pursuant
 to paragraph (1) shall be a direct liability of the Savings Association
 Insurance Fund.
 `(3) INTEREST ON AND SECURITY FOR SUCH LOANS- Any loan by a Federal Home
 Loan Bank pursuant to paragraph (1) shall--
 `(A) bear a rate of interest not less than such Bank's current marginal
 cost of funds, taking into account the maturities involved; and
 `(B) be adequately secured.'.
SEC. 710. ELIGIBILITY OF BORROWERS TO SECURE ADVANCES.
 (a) IN GENERAL- Section 9 of the Federal Home Loan Bank Act (12 U.S.C. 1429)
 is amended by striking `or nonmember borrower' in the first sentence.
 (b) CONFORMING AMENDMENTS- The Federal Home Loan Bank Act (12 U.S.C. 1421
 et seq.) is amended--
 (1) in sections 2(5) and 4(b), by striking `or a nonmember borrower'
 wherever it appears;
 (2) in section 6(e) (as redesignated by section 706 of this Act), by striking
 `or nonmember borrower' wherever it appears;
 (3) in section 6(e) (as redesignated by section 706 of this Act), by striking
 `or deprive any nonmember borrower of the privilege of further advances,';
 (4) in sections 7(j) and 10(c), by striking `or nonmember borrower' wherever
 it appears;
 (5) in section 10(c), by striking `, or made to a nonmember borrower'
 in the second sentence; and
 (6) in sections 11(g) and 11(h), by striking `or nonmember borrowers'
 wherever it appears.
 (c) COMMUNITY SUPPORT- Section 10 of the Federal Home Loan Bank Act (12
 U.S.C. 1430) is amended by adding at the end the following:
 `(g) Community Support Requirements-
 `(1) IN GENERAL- Before the end of the 2-year period beginning on the date
 of enactment of the Financial Institutions Reform, Recovery, and Enforcement
 Act of 1989, the Board shall adopt regulations establishing standards of
 community investment or service for members of Banks to maintain continued
 access to long-term advances.
 `(2) FACTORS TO BE INCLUDED- The regulations promulgated pursuant to paragraph
 (1) shall take into account factors such as a member's performance under
 the Community Reinvestment Act of 1977 and the member's record of lending
 to first-time homebuyers.'.
SEC. 711. ADMINISTRATIVE EXPENSES.
 Section 18(b) of the Federal Home Loan Bank Act (12 U.S.C. 1437(b)) is
 amended to read as follows:
 `(b) Assessments for Administrative Expenses-
 `(1) IN GENERAL- The Board may impose a semiannual assessment on the Federal
 Home Loan Banks, the aggregate amount of which is sufficient to provide for
 the payment of the Board's estimated expenses for the period for which such
 assessment is made.
 `(2) DEFICIENCIES- If, at any time, amounts available from any assessment for
 any semiannual period are insufficient to cover the expenses of the Board
 incurred in carrying out the provisions of this Act during such period,
 the Board may make an immediate assessment against the Banks to cover the
 amount of the deficiency for such semiannual period.
 `(3) SURPLUSES- If, at the end of any semiannual period for which an
 assessment is made, any amount remains from such assessment, such amount
 will be deducted from the assessment on the Banks by the Board for the
 following semiannual period.
 `(4) TRANSITION PROVISION- On or after the effective date of the Financial
 Institutions Reform, Recovery, and Enforcement Act of 1989, the Board may
 levy a one-time special assessment on the Banks pursuant to this subsection
 for the Board's estimated expenses for the transitional period following
 enactment of such Act, if such assessment is made before the Board's first
 semiannual assessment under paragraph (1).'.
SEC. 712. NONADMINISTRATIVE EXPENSES.
 Subsection (a) of section 18 of the Federal Home Loan Bank Act (12
 U.S.C. 1438(a)) and section 19A of such Act (12 U.S.C. 1439-1) are hereby
 repealed.
SEC. 713. FEDERAL SAVINGS AND LOAN INSURANCE CORPORATION INDUSTRY ADVISORY
COMMITTEE.
 Subsection (i) of section 21 of the Federal Home Loan Bank Act (12
 U.S.C. 1441) is repealed and subsections (j), (k), and (l) are redesignated
 subsections (i), (j), and (k), respectively.
SEC. 714. ADVANCES.
 (a) IN GENERAL- Subsection (a) of section 10 of the Federal Home Loan Bank
 Act (12 U.S.C. 1430(a)) is amended by striking everything after `members'
 to the end period and inserting the following: `upon collateral sufficient,
 in the judgment of the Bank, to fully secure advances obtained from the Bank
 under this section or section 11(g) of this Act. All long-term advances
 shall only be made for the purpose of providing funds for residential
 housing finance. A Bank, at the time of origination or renewal of a loan
 or advance, shall obtain and maintain a security interest in collateral
 eligible pursuant to one or more of the following categories:
 `(1) Fully disbursed, whole first mortgages on improved residential property
 (not more than 90 days delinquent), or securities representing a whole
 interest in such mortgages.
 `(2) Securities issued, insured, or guaranteed by the United States
 Government or any agency thereof (including without limitation,
 mortgage-backed securities issued or guaranteed by the Federal Home Loan
 Mortgage Corporation, the Federal National Mortgage Corporation, and the
 Government National Mortgage Association).
 `(3) Deposits of a Federal Home Loan Bank.
 `(4) Other real estate related collateral acceptable to the Bank if such
 collateral has a readily ascertainable value and the Bank can perfect its
 interest in the collateral. The aggregate amount of outstanding advances
 secured by such other real estate related collateral shall not exceed 30
 percent of such member's capital.
 `(5) Paragraphs (1) through (4) shall not affect the ability of any Federal
 Home Loan Bank to take such steps as it deems necessary to protect its
 security position with respect to outstanding advances, including requiring
 deposits of additional collateral security, whether or not such additional
 security would be eligible to originate an advance. If an advance existing
 on the date of enactment of the Financial Institutions Reform, Recovery,
 and Enforcement Act of 1989 matures and the member does not have sufficient
 eligible collateral to fully secure a renewal of such advance, a Bank may
 renew such advance secured by such collateral as the Bank and the Board
 determines is appropriate. A member that has an advance secured by such
 insufficient eligible collateral must reduce its level of outstanding
 advances promptly and prudently in accordance with a schedule determined
 by the Board.'.
 (b) REDUCED ELIGIBILITY FOR ADVANCES- Section 10(e) of the Federal Home
 Loan Bank Act (12 U.S.C. 1430(e)) is amended to read as follows:
 `(e) Qualified Thrift Lender Status-
 `(1) IN GENERAL- A member that is not a qualified thrift lender may only
 receive an advance if it holds stock in its Federal Home Loan Bank at the
 time it receives that advance in an amount equal to at least--
 `(A) 5 percent of that member's total advances, divided by
 `(B) such member's actual thrift investment percentage.
Such members that are not qualified thrift lenders may only apply for advances
under this section for the purpose of obtaining funds for housing finance.
 `(2) PRIORITY- The Board, by regulation, shall establish a priority for
 advances to members that are qualified thrift lenders. The aggregate amount
 of any Bank's advances to members that are not qualified thrift lenders
 shall not exceed 30 percent of a Bank's total advances.
 `(3) MINIMUM STOCK PURCHASE REQUIREMENT FOR MEMBERSHIP- Each member of a
 Federal Home Loan Bank shall, at a minimum, purchase and maintain stock in
 its Federal Home Loan Bank in the amount that would be required under section
 6(b) if at least 30 percent of such member's assets were home mortgage loans.
 `(4) EXCEPTIONS- Paragraphs (1) and (2) of this subsection do not apply to--
 `(A) a savings bank as defined in section 3 of the Federal Deposit Insurance
 Act; or
 `(B) a Federal savings association in existence as a Federal savings
 association on the date of enactment of the Financial Institutions Reform,
 Recovery, and Enforcement Act of 1989--
 `(i) that was chartered as a savings bank or cooperative bank prior to
 October 15, 1982; or
 `(ii) that acquired its principal assets from an institution which was
 chartered prior to October 15, 1982, as a savings bank or cooperative bank
 under State law.
 `(5) DEFINITIONS- As used in this subsection--
 `(A) SAVINGS ASSOCIATION- The term `savings association' has the same
 meaning as in section 10(a)(1)(A) of the Home Owners' Loan Act.
 `(B) QUALIFIED THRIFT LENDER- The term `qualified thrift lender' has the
 same meaning as in section 10(m) of the Home Owners' Loan Act.
 `(C) ACTUAL THRIFT INVESTMENT PERCENTAGE- The term `actual thrift investment
 percentage' has the same meaning as in section 10(m) of the Home Owners'
 Loan Act.'.
 (c) SPECIAL LIQUIDITY ADVANCES- Section 10 of the Federal Home Loan Bank Act
 (12 U.S.C. 1430) (as amended by section 710(c) of this Act) is amended by
 adding at the end the following new subsection:
 `(h) Special Liquidity Advances-
 `(1) IN GENERAL- Subject to paragraph (2), the Federal Home Loan Banks
 may, upon the request of the Director of the Office of Thrift Supervision,
 make short-term liquidity advances to a savings association that--
 `(A) is solvent but presents a supervisory concern because of such
 association's poor financial condition; and
 `(B) has reasonable and demonstrable prospects of returning to a satisfactory
 financial condition.
 `(2) INTEREST ON AND SECURITY FOR SPECIAL LIQUIDITY ADVANCES- Any loan by
 a Federal Home Loan Bank pursuant to paragraph (1) shall be subject to all
 applicable collateral requirements, including the requirements of section
 10(a) of this Act, and shall be at an interest rate no less favorable than
 those made available for similar short-term liquidity advances to savings
 associations that do not present such supervisory concern.'.
SEC. 715. AMENDMENTS RELATING TO WITHDRAWAL FROM FEDERAL HOME LOAN BANK
MEMBERSHIP.
 Section 6(h) of the Federal Home Loan Bank Act (as redesignated by section
 706 of this Act) is amended by striking `five' and inserting `10'.
SEC. 716. REPEAL OF PROVISIONS RELATING TO LAWFUL CONTRACT RATE.
 Section 5 of the Federal Home Loan Bank Act (12 U.S.C. 1425) is hereby
 repealed.
SEC. 717. BANK STOCK AND OBLIGATIONS.
 Section 23 of the Federal Home Loan Bank Act (12 U.S.C. 1443) is amended
 to read as follows:
`SEC. 23. FORMS OF BANK STOCK AND OBLIGATIONS.
 `Any stock, debentures, bonds, notes, or other obligations issued under
 the authority of this Act may be issued in uncertificated form, utilizing a
 book entry method, or in certificated form under such rules, regulations,
 or guidelines as the Board of Directors of the Federal Housing Finance
 Board may provide.'.
SEC. 718. THRIFT ADVISORY COUNCIL.
 Section 8a of the Federal Home Loan Bank Act (12 U.S.C. 1428a) is hereby
 repealed.
SEC. 719. EXAMINATION OF MEMBERS.
 Section 22 of the Federal Home Loan Bank Act (12 U.S.C. 1442) is amended
 to read as follows:
`SEC. 22. MEMBER FINANCIAL INFORMATION.
 `(a) IN GENERAL- In order to enable the Federal Home Loan Banks to carry out
 the provisions of this Act, the Secretary of the Treasury, the Comptroller of
 the Currency, the Chairman of the Board of Governors of the Federal Reserve
 System, the Chairperson of the Federal Deposit Insurance Corporation, the
 Chairperson of the National Credit Union Administration, and the Director of
 the Office of Thrift Supervision, upon request by any Federal Home Loan Bank--
 `(1) shall make available in confidence to any Federal Home Loan Bank, such
 reports, records, or other information as may be available, relating to the
 condition of any member of any Federal Home Loan Bank or any institution with
 respect to which any such Bank has had or contemplates having transactions
 under this Act; and
 `(2) may perform through their examiners or other employees or agents, for the
 confidential use of the Federal Home Loan Bank, examinations of institutions
 for which such agency is the appropriate Federal banking regulatory agency.
In addition, the Comptroller of the Currency, the Chairman of the Board of
Governors of the Federal Reserve System, the Chairperson of the National Credit
Union Administration, and the Director of the Office of Thrift Supervision
shall make available to the Board or any Federal Home Loan Bank the financial
reports filed by members of any Bank to enable the Board or a Bank to compile
and publish cost of funds indices or other financial or statistical reports.
 `(b) CONSENT BY MEMBERS- Every member of a Federal Home Loan Bank shall,
 as a condition precedent thereto, be deemed--
 `(1) to consent to such examinations as the Bank or the Board may require
 for the purposes of this Act;
 `(2) to agree that reports of examinations by local, State, or Federal
 agencies or institutions may be furnished by such authorities to the Bank
 or the Board upon request; and
 `(3) to agree to give the Bank or the Federal agency, upon request, such
 information as they may need to compile and publish cost of funds indices
 and to publish other reports or statistical summaries pertaining to the
 activities of Bank members.'.
SEC. 720. LIQUIDITY.
 Section 5A of the Federal Home Loan Bank Act (12 U.S.C. 1425a) is hereby
 repealed.
SEC. 721. AFFORDABLE HOUSING.
 Section 10 of the Federal Home Loan Bank Act (12 U.S.C. 1430) (as amended
 by section 710 and section 714 of this Act) is amended by adding at the
 end the following:
 `(i) COMMUNITY INVESTMENT PROGRAM-
 `(1) IN GENERAL- Each Bank shall establish a program to provide funding for
 members to undertake community-oriented mortgage lending. Each Bank shall
 designate a community investment officer to implement community lending
 and affordable housing advance programs of the Banks under this subsection
 and subsection (j) and provide technical assistance and outreach to promote
 such programs. Advances under this program shall be priced at the cost of
 consolidated Federal Home Loan Bank obligations of comparable maturities,
 taking into account reasonable administrative costs.
 `(2) COMMUNITY-ORIENTED MORTGAGE LENDING- For purposes of this subsection,
 the term `community-oriented mortgage lending' means providing loans--
 `(A) to finance home purchases by families whose income does not exceed
 115 percent of the median income for the area,
 `(B) to finance purchase or rehabilitation of housing for occupancy by
 families whose income does not exceed 115 percent of median income for
 the area,
 `(C) to finance commercial and economic development activities that benefit
 low- and moderate-income families or activities that are located in low-
 and moderate-income neighborhoods, and
 `(D) to finance projects that further a combination of the purposes described
 in subparagraphs (A) through (C).
 `(j) Affordable Housing Program-
 `(1) IN GENERAL- Pursuant to regulations promulgated by the Board, each
 Bank shall establish an Affordable Housing Program to subsidize the
 interest rate on advances to members engaged in lending for long term,
 low- and moderate-income, owner-occupied and affordable rental housing at
 subsidized interest rates.
 `(2) STANDARDS- The Board's regulations shall permit Bank members to use
 subsidized advances received from the Banks to--
 `(A) finance homeownership by families with incomes at or below 80 percent
 of the median income for the area; or
 `(B) finance the purchase, construction, or rehabilitation of rental housing,
 at least 20 percent of the units of which will be occupied by and affordable
 for very low-income households for the remaining useful life of such housing
 or the mortgage term.
 `(3) PRIORITIES FOR MAKING ADVANCES- In using advances authorized under
 paragraph (1), each Bank member shall give priority to qualified projects
 such as the following:
 `(A) purchase of homes by families whose income is 80 percent or less of
 the median income for the area,
 `(B) purchase or rehabilitation of housing owned or held by the United
 States Government or any agency or instrumentality of the United States; and
 `(C) purchase or rehabilitation of housing sponsored by any nonprofit
 organization, any State or political subdivision of any State, any local
 housing authority or State housing finance agency.
 `(4) REPORT- Each member receiving advances under this program shall report
 annually to the Bank making such advances concerning the member's use of
 advances received under this program.
 `(5) CONTRIBUTION TO PROGRAM- Each Bank shall annually contribute
 the percentage of its annual net earnings prescribed in the following
 subparagraphs to support subsidized advances through the Affordable Housing
 Program:
 `(A) In 1990, 1991, 1992, and 1993, 5 percent of the preceding year's
 net income, or such prorated sums as may be required to assure that the
 aggregate contribution of all the Banks shall not be less than $50,000,000
 for each such year.
 `(B) In 1994, 6 percent of the preceding year's net income, or such prorated
 sum as may be required to assure that the aggregate contribution of the
 Banks shall not be less than $75,000,000 for such year.
 `(C) In 1995, and subsequent years, 10 percent of the preceding year's
 net income, or such prorated sums as may be required to assure that the
 aggregate contribution of the Banks shall not be less than $100,000,000
 for each such year.
 `(6) GROUNDS FOR SUSPENDING CONTRIBUTIONS-
 `(A) IN GENERAL- If a Bank finds that the payments required under this
 paragraph are contributing to the financial instability of such Bank, it
 may apply to the Federal Housing Finance Board for a temporary suspension
 of such payments.
 `(B) FINANCIAL INSTABILITY- In determining the financial instability of a
 Bank, the Federal Housing Finance Board shall consider such factors as (i)
 whether the Bank's earnings are severely depressed, (ii) whether there has
 been a substantial decline in membership capital, and (iii) whether there
 has been a substantial reduction in advances outstanding.
 `(C) REVIEW- The Board shall review the application and any supporting
 financial data and issue a written decision approving or disapproving such
 application. The Board's decision shall be accompanied by specific findings
 and reasons for its action.
 `(D) MONITORING SUSPENSION- If the Board grants a suspension, it shall
 specify the period of time such suspension shall remain in effect and shall
 continue to monitor the Bank's financial condition during such suspension.
 `(E) LIMITATIONS ON GROUNDS FOR SUSPENSION- The Board shall not suspend
 payments to the Affordable Housing Program if the Bank's reduction in
 earnings is a result of (i) a change in the terms for advances to members
 which is not justified by market conditions, (ii) inordinate operating and
 administrative expenses, or (iii) mismanagement.
 `(F) The Federal Housing Finance Board shall notify the Committee on Banking,
 Finance and Urban Affairs of the House of Representatives and the Committee
 on Banking, Housing, and Urban Affairs of the Senate not less than 60 days
 before such suspension takes effect. Such suspension shall become effective
 unless a joint resolution is enacted disapproving such suspension.
 `(7) FAILURE TO USE AMOUNTS FOR AFFORDABLE HOUSING- If any Bank fails to
 utilize or commit the full amount provided in this subsection in any year,
 90 percent of the amount that has not been utilized or committed in that
 year shall be deposited by the Bank in an Affordable Housing Reserve Fund
 administered by the Board. The 10 percent of the unutilized and uncommitted
 amount retained by a Bank should be fully utilized or committed by that Bank
 during the following year and any remaining portion must be deposited in the
 Affordable Housing Reserve Fund. Under regulations established by the Board,
 funds from the Affordable Housing Reserve Fund may be made available to any
 Bank to meet additional affordable housing needs in such Bank's district
 pursuant to this section.
 `(8) NET EARNINGS- The net earnings of any Federal Home Loan Bank shall be
 determined for purposes of this paragraph--
 `(A) after reduction for any payment required under section 21 or 21B of
 this Act; and
 `(B) before declaring any dividend under section 16.
 `(9) REGULATIONS- The Federal Housing Finance Board shall promulgate
 regulations to implement this subsection. Such regulations shall, at
 a minimum--
 `(A) specify activities eligible to receive subsidized advances from the
 Banks under this program;
 `(B) specify priorities for the use of such advances;
 `(C) ensure that advances made under this program will be used only to
 assist projects for which adequate long-term monitoring is available to
 guarantee that affordability standards and other requirements of this
 subsection are satisfied;
 `(D) ensure that a preponderance of assistance provided under this subsection
 is ultimately received by low- and moderate-income households;
 `(E) ensure that subsidies provided by Banks to member institutions under
 this program are passed on to the ultimate borrower;
 `(F) establish uniform standards for subsidized advances under this program
 and subsidized lending by member institutions supported by such advances,
 including maximum subsidy and risk limitations for different categories of
 loans made under this subsection; and
 `(G) coordinate activities under this subsection with other Federal or
 federally-subsidized affordable housing activities to the maximum extent
 possible.
 `(10) OTHER PROGRAMS- No provision of this subsection or subsection (i)
 shall preclude any Bank from establishing additional community investment
 cash advance programs or contributing additional sums to the Affordable
 Housing Reserve Fund.
 `(11) ADVISORY COUNCIL- Each Bank shall appoint an Advisory Council of 7 to 15
 persons drawn from community and nonprofit organizations actively involved in
 providing or promoting low- and moderate-income housing in its district. The
 Advisory Council shall meet with representatives of the board of directors
 of the Bank quarterly to advise the Bank on low- and moderate-income housing
 programs and needs in the district and on the utilization of the advances
 for these purposes. Each Advisory Council established under this paragraph
 shall submit to the Board at least annually its analysis of the low-income
 housing activity of the Bank by which it is appointed.
 `(12) Reports to congress-
 `(A) The Board shall monitor and report annually to the Congress and the
 Advisory Council for each Bank the support of low-income housing and community
 development by the Banks and the utilization of advances for these purposes.
 `(B) The analyses submitted by the Advisory Councils to the Board under
 paragraph (11) shall be included as part of the report required by this
 paragraph.
 `(C) The Comptroller General of the United States shall audit and evaluate
 the Affordable Housing Program established by this subsection after such
 program has been operating for 2 years. The Comptroller General shall report
 to Congress on the conclusions of the audit and recommend improvements or
 modifications to the program.
 `(13) DEFINITIONS- For purposes of this subsection--
 `(A) LOW- OR MODERATE-INCOME HOUSEHOLD- The term `low- or moderate-income
 household' means any household which has an income of 80 percent or less
 of the area median.
 `(B) VERY LOW-INCOME HOUSEHOLD- The term `very low-income household' means
 any household that has an income of 50 percent or less of the area median.
 `(C) LOW- OR MODERATE-INCOME NEIGHBORHOOD- The term `low- or moderate-income
 neighborhood' means any neighborhood in which 51 percent or more of the
 households are low- or moderate-income households.
 `(D) AFFORDABLE FOR VERY-LOW INCOME HOUSEHOLDS- For purposes of paragraph
 (2)(B) the term `affordable for very-low income households' means that rents
 charged to tenants for units made available for occupancy by low-income
 families shall not exceed 30 percent of the adjusted income of a family whose
 income equals 50 percent of the income for the area (as determined by the
 Secretary of Housing and Urban Development) with adjustment for family size.'.
SEC. 722. TRANSFERRED EMPLOYEES OF FEDERAL HOME LOAN BANKS AND JOINT OFFICES.
 (a) IN GENERAL- Each employee of the Federal Home Loan Banks or joint offices
 of such Banks performing a function identified for transfer under section
 403 of this Act, including employees who otherwise would be ineligible
 for employment by the United States because of their citizenship, shall
 be transferred for employment not later than 60 days after the date of the
 enactment of this Act.
 (b) NOTICE TO EMPLOYEES- Transferring employees shall receive notice of
 their position assignments not later than 120 days after the effective date
 of their transfer.
 (c) GUARANTEED POSITION- Each transferred employee shall be guaranteed a
 position with the same status and tenure as that held by such employee on
 the day immediately preceding the transfer. Each such employee holding a
 permanent position shall not be involuntarily separated for one year after
 the date of transfer, except for cause.
 (d) PAY AND BENEFITS- Each employee transferred under this section shall be
 entitled to receive, during the one-year period immediately following the
 transfer, pay and benefits comparable to those received by such employee
 immediately preceding the transfer. Where necessary or appropriate to
 further the safety and soundness of the thrift industry, the employing
 agency may continue the pre-transfer compensation of any transferring
 employee for up to 2 years beyond the expiration of the period provided
 for under the preceding sentence. Such pay and benefits shall be subject
 to the comparability provisions of this Act. Any transferred employee who
 suffers a reduction of pay or benefits as a result of such comparability
 provisions shall be compensated for such reduction during the 1 year period
 following the transfer by assessments from the Federal Home Loan Bank or
 joint office of such Banks, from which the employee transferred. In any
 event, this subsection shall only apply to a transferred employee while
 such employee remains with the agency to which the employee is transferred.
 (e) HEALTH INSURANCE- If the health insurance program of a transferred
 employee is not continued by the agency to which the employee is transferred,
 such employee may elect to participate in the agency's health insurance
 program notwithstanding health conditions pre-existing at the time of
 election or enrollment into an alternate health insurance program of the
 agency to which he or she is transferred and without regard to any other
 regularly scheduled open season. Such election shall be made within 30 days
 of the transfer.
 (f) EQUITABLE TREATMENT- The Director of the Office of Thrift Supervision or
 the Chairperson of the Federal Housing Finance Board shall take such action
 as is necessary on a case-by-case basis so that employees transferring under
 this section receive equitable treatment regarding credit for prior service
 with a Federal entity or instrumentality, or with a Federal Home Loan Bank
 or joint office of such Banks, with respect to the transferring employees'
 retirement accounts and the transferring employees' accrued leave or vacation
 time, in recognition of the transferring employees' supervisory service.
 (g) SPECIAL RULE FOR CERTAIN ANNUITANTS- An individual who was a reemployed
 annuitant on July 26, 1989, and who is transferred under this section,
 shall not be subject to the deduction from pay required by section 8344 or
 8468 of title 5, United States Code, during the 1-year period beginning
 on the date of enactment of the Financial Institutions Reform, Recovery,
 and Enforcement Act of 1989.
SEC. 723. TRANSITIONAL PROVISIONS.
 (a) FEDERAL HOME LOAN BANKS' SHARE OF ADMINISTRATIVE EXPENSES- The Federal
 Home Loan Banks shall pay to the Director of the Office of Thrift Supervision
 the amount obtained by multiplying the administrative expenses of the Office
 of Thrift Supervision incurred in connection with functions of the Banks
 that are transferred to the Office (less any fees or assessments collected
 by the Office) by a fraction--
 (1) the numerator of which is the amount of such expenses of the Federal
 Home Loan Bank Board and the Federal Savings and Loan Insurance Corporation
 paid by the Banks during the 1-year period ending on the date of enactment
 of this Act; and
 (2) the denominator of which is the total expenses of such Board and
 Corporation during such period.
No payment under this subsection is required after December 31, 1989.
 (b) COMPENSATION OF SUPERVISORY AND EXAMINATIONS EMPLOYEES- The Federal
 Home Loan Banks shall continue to pay the compensation of employees of the
 Federal Home Loan Banks or the joint offices of such banks who, on the day
 before the date of the enactment of this Act, are performing supervisory
 and examination functions until such supervisory and examination functions
 are transferred under this Act. Thereafter, the obligation of the Federal
 Home Loan Banks hereunder to pay such applicable compensation shall continue
 until the later of--
 (1) the date which is 120 days after the date of transfer of such supervisory
 and examination functions to the Office of Thrift Supervision, or
 (2) March 31, 1990.
Payment of such compensation by the Federal Home Loan Banks shall be in
lieu of, and not in addition to, the payment of compensation by the Office
of Thrift Supervision.
 (c) FACILITIES AND SUPPORT SERVICES- Until December 31, 1990, the Federal Home
 Loan Banks, as necessary, shall (with respect to supervisory and examination
 functions performed by employees transferred from the Federal Home Loan
 Banks or joint offices of such Banks to the Office of Thrift Supervision),
 provide the Office of Thrift Supervision facilities and support services
 comparable to those presently provided for the employees of the Federal
 Home Loan Banks or joint offices of such Banks performing such supervisory
 and examination functions, including office space, furniture and equipment,
 computer, personnel, and other support services. With respect to supervisory
 and examination functions presently performed by employees of individual
 Federal Home Loan Banks, each such Bank will only be required to provide
 such facilities and support services to the extent that the functions
 continue to be performed in that Bank's offices.
 (d) PRINCIPAL SUPERVISORY AGENT- Beginning on the date of enactment of this
 Act until the Director of the Office of Thrift Supervision shall otherwise
 provide, the Principal Supervisory Agent for each Federal Home Loan Bank
 district shall be the senior supervisory official (other than the President
 of the Federal Home Loan Bank) employed by the Federal Home Loan Bank in
 such district on the day before the date of the enactment of this Act,
 and such employees performing supervisory and examination functions shall
 continue to be responsible for the supervision and examination of savings
 associations within such district.
SEC. 724. FEDERAL HOME LOAN BANK RESERVES.
 (a) IN GENERAL- Section 16(a) of the Federal Home Loan Bank Act (12
 U.S.C. 1436(a)) is amended--
 (1) by striking the first three sentences and inserting in lieu thereof:
 `Each Federal Home Loan Bank may carry to a reserve account from time-to-time
 such portion of its net earnings as may be determined by its board of
 directors.'; and
 (2) by striking the fifth sentence and inserting the following: `No dividends
 shall be paid except out of net earnings remaining after reductions for all
 reserves, chargeoffs, purchases of capital certificates of the Financing
 Corporation, and payments relating to the Funding Corporation required
 under this Act have been provided for, other than chargeoffs or expenses
 incurred by a Bank in connection with the purchase of capital stock of the
 Financing Corporation under section 21 or payments relating to the Funding
 Corporation Principal Fund under section 21B(e), and then only with the
 approval of the Federal Housing Finance Board. Beginning on January 1,
 1992, the preceding sentence shall be applied by substituting `previously
 retained earnings or current net earnings' for `net earnings'.'.
 (b) EFFECTIVE DATE- The amendment made by subsection (a)(1) shall take
 effect on January 1, 1992.
SEC. 725. SPECIAL ACCOUNT.
 At the time of dissolution of the Federal Home Loan Bank Board, all such
 moneys and funds as shall remain in the special deposit account of the
 Federal Home Loan Bank Board, or other such accounts, shall become the
 property of the Federal Housing Finance Board.
Subtitle B--Federal Home Loan Mortgage Corporation
SEC. 731. FEDERAL HOME LOAN MORTGAGE CORPORATION.
 (a) STATEMENT OF PURPOSE-
 (1) IN GENERAL- Section 301 of the Federal Home Loan Mortgage Corporation
 Act (12 U.S.C. 1451 note) is amended--
 (A) by inserting `(a)' after the section designation; and
 (B) by adding at the end the following new subsection:
 `(b) It is the purpose of the Federal Home Loan Mortgage Corporation--
 `(1) to provide stability in the secondary market for home mortgages;
 `(2) to respond appropriately to the private capital market; and
 `(3) to provide ongoing assistance to the secondary market for home mortgages
 (including mortgages securing housing for low- and moderate-income families
 involving a reasonable economic return to the Corporation) by increasing
 the liquidity of mortgage investments and improving the distribution of
 investment capital available for home mortgage financing.'.
 (2) CONFORMING AMENDMENT- The section heading for section 301 of the Federal
 Home Loan Mortgage Corporation Act (12 U.S.C. 1451 note) is amended to read
 as follows:
`SHORT TITLE AND STATEMENT OF PURPOSE'.
 (b) BOARD OF DIRECTORS-
 (1) NEW BOARD- Section 303(a) of the Federal Home Loan Mortgage Corporation
 Act (12 U.S.C. 1452(a)) is amended to read as follows:
 `(a)(1) There is hereby created the Federal Home Loan Mortgage Corporation,
 which shall be a body corporate under the direction of a Board of
 Directors. Within the limitations of law and regulation, the Board of
 Directors shall determine the general policies that govern the operations
 of the Corporation. The principal office of the Corporation shall be in
 the District of Columbia or at any other place determined by the Corporation.
 `(2)(A) The Board of Directors of the Corporation shall consist of 18 persons,
 5 of whom shall be appointed annually by the President of the United States
 and the remainder of whom shall be elected annually by the voting common
 stockholders. The Board of Directors shall at all times have as members
 appointed by the President of the United States at least 1 person from the
 homebuilding industry, at least 1 person from the mortgage lending industry,
 and at least 1 person from the real estate industry.
 `(B) Each member of the Board of Directors shall be such or elected for
 a term ending on the date of the next annual meeting of the voting common
 stockholders.
 `(C) Any appointive seat on the Board of Directors that becomes vacant shall
 be filled by appointment by the President of the United States, but only for
 the unexpired portion of the term. Any elective seat on the Board of Directors
 that becomes vacant after the annual election of the directors shall be filled
 by the Board of Directors, but only for the unexpired portion of the term.
 `(D) Any member of the Board of Directors who is a full-time officer or
 employee of the Federal Government shall not, as such member, receive
 compensation for services as such a member.'.
 (2) TRANSITIONAL PROVISIONS-
 (A) INTERIM BOARD-
 (i) ESTABLISHMENT- There shall be an interim Board of Directors of the
 Federal Home Loan Mortgage Corporation, which shall serve from the date of
 the enactment of this Act until the date of the 1st meeting of the voting
 common shareholders of the Corporation at which the first election of the
 directors elected by the shareholders occurs.
 (ii) MEMBERS- The interim Board of Directors of the Federal Home Loan
 Mortgage Corporation shall consist of--
 (I) the President of the Corporation; and
 (II) the persons who were (on the day before the date of the enactment of
 this Act) the Chairman of the Federal Home Loan Bank Board and the Secretary
 of Housing and Urban Development (or their designees).
 (iii) QUORUM- A quorum of the interim Board of Directors of the Federal Home
 Loan Mortgage Corporation shall consist of a majority of the directors duly
 serving from time to time.
 (B) ELECTION OF PERMANENT DIRECTORS- The first meeting of the voting common
 shareholders of the Federal Home Loan Mortgage Corporation for election
 of directors shall occur, under procedures established by the Corporation,
 within 6 months after the date of the enactment of this Act.
 (c) REGULATORY POWER- Section 303 of the Federal Home Loan Mortgage
 Corporation Act (12 U.S.C. 1452) is amended--
 (1) by redesignating subsections (b) through (f) as subsections (c) through
 (g), respectively; and
 (2) by inserting after subsection (a) the following new subsection:
 `(b)(1) The Secretary of Housing and Urban Development shall have general
 regulatory power over the Corporation and shall make such rules and
 regulations as shall be necessary and proper to ensure that the purposes
 of this title are accomplished.
 `(2) The Secretary of Housing and Urban Development may require that a
 reasonable portion of the mortgage purchases of the Corporation be related to
 the national goal of providing adequate housing for low- and moderate-income
 families, but with reasonable economic return to the Corporation.
 `(3) The aggregate amount of cash dividends paid by the Corporation in any
 fiscal year on account of any share of its common stock shall not exceed any
 rate that may be determined from time to time by the Secretary of Housing
 and Urban Development to be a fair rate of return after consideration of
 the current earnings and capital condition of the Corporation.
 `(4) The Secretary of Housing and Urban Development may examine and audit
 the books and financial transactions of the Corporation and may require
 the Corporation to issue any reports on its activities that the Secretary
 determines to be advisable. The Secretary shall, not later than June 30
 of each year, submit to the Congress a report describing the activities of
 the Corporation under this Act.
 `(5) The aggregate amount of notes, debentures, or substantially identical
 types of unsecured obligations outstanding at any time shall not exceed
 the amount which is 15 times the sum of the Corporation's capital,
 capital surplus, general surplus, reserves, and undistributed earnings
 unless a greater ratio shall be fixed at any time or from time to time
 by the Secretary of Housing and Urban Development. The outstanding total
 principal amount of any obligations of the Corporation which are entirely
 subordinated to the general debt obligations of the Corporation shall be
 deemed to be capital of the Corporation for the purpose of determining the
 aggregate amount of notes, debentures, or substantially identical types of
 unsecured obligations outstanding at any time.
 `(6) All issuances of stock, and debt obligations convertible into stock,
 by the Corporation shall be made only with the approval of the Secretary
 of Housing and Urban Development.
 `(7)(A) The exercise of the authority of the Corporation pursuant to
 commitments or otherwise to purchase, service, sell, lend on the security
 of, or otherwise deal in conventional residential mortgages under section
 305(a) shall be subject to the approval of the Secretary of Housing and
 Urban Development.
 `(B) Any conventional mortgage programs or activities with respect to
 purchasing, servicing, selling, lending on the security of, or otherwise
 dealing in mortgages in which the Corporation has engaged or is engaging as
 of the date of the enactment of the Financial Institutions Reform, Recovery,
 and Enforcement Act of 1989 shall be deemed to have been approved by the
 Secretary of Housing and Urban Development as required by this paragraph.
 `(8) If the Corporation submits to the Secretary of Housing and Urban
 Development a request for approval or other action under this title,
 the Secretary shall, not later than the expiration of the 45-day period
 following the submission of the request, approve the request or transmit to
 the Congress a report explaining why the request has not been approved. The
 period may be extended for an additional 15-day period if the Secretary
 requests additional information from the Corporation, but the 45-day period
 may not be extended for any other reason or for any period in addition to or
 other than the 15-day period. If the Secretary fails to transmit the report
 to the Congress within the 45-day period or 60-day period, as the case may
 be, the Corporation may proceed as if the request had been approved.'.
 (d) COMMON STOCK-
 (1) IN GENERAL- Section 304(a) of the Federal Home Loan Mortgage Corporation
 Act (12 U.S.C. 1453(a)) is amended to read as follows:
 `(a)(1) The common stock of the Corporation shall consist of--
 `(A) nonvoting common stock, which shall be issued only to Federal home
 loan banks; and
 `(B) voting common stock, which shall be issued to such holders in the manner
 and amount, and subject to any limitations on concentration of ownership,
 as may be established by the Corporation.
 `(2) The nonvoting common stock and the voting common stock shall have such
 par value and other characteristics as the Corporation provides. The voting
 common stock shall be vested with all voting rights, each share being entitled
 to 1 vote. The free transferability of the voting common stock at all times
 to any person, firm, corporation or other entity shall not be restricted
 except that, as to the Corporation, it shall be transferable only on the
 books of the Corporation. Nonvoting common stock of the Corporation shall
 be evidenced in the manner and shall be transferable only to the extent,
 to the transferees, and in the manner, provided by the Corporation.'.
 (2) CONVERSION OF STOCK- On the date of the enactment of this Act, each
 share of outstanding senior participating preferred stock of the Federal
 Home Loan Mortgage Corporation, with a par value of $2.50 per share, shall
 be changed into and shall become 1 share of voting common stock of the
 Corporation. Such voting common stock shall, with respect to the nonvoting
 common stock of the Corporation, retain all of the rights, priorities and
 privileges of the senior participating preferred stock. The transformation
 of the senior participating preferred stock into voting common stock under
 this paragraph shall be deemed to satisfy the obligation of the Corporation
 to redeem senior participating preferred stock for non-callable common stock.
 (3) CONFORMING AMENDMENTS-
 (A) SUBSCRIPTIONS OF FEDERAL HOME LOAN BANKS- Section 304(b) of the Federal
 Home Loan Mortgage Corporation Act (12 U.S.C. 1453(b)) is amended by inserting
 `nonvoting' before `common'.
 (B) ALLOCATION OF SUBSCRIPTIONS- Section 304(c) of the Federal Home Loan
 Mortgage Corporation Act (12 U.S.C. 1453(c)) is amended by striking `such'
 and by inserting `nonvoting common' before `stock'.
 (C) RETIREMENT OF STOCK- Section 304(d) of the Federal Home Loan Mortgage
 Corporation Act (12 U.S.C. 1453(d)) is amended by inserting `nonvoting
 common' before `stock' each place it appears.
 (e) MORTGAGE OPERATIONS-
 (1) PROHIBITION ON FEES- Section 305(a)(1) of the Federal Home Loan Mortgage
 Corporation Act (12 U.S.C. 1454(a)(1)) is amended by adding at the end the
 following: `Nothing in this section authorizes the Corporation to impose
 any charge or fee upon any mortgagee approved by the Secretary of Housing
 and Urban Development for participation in any mortgage insurance program
 under the National Housing Act solely because of such status.'.
 (2) LENDING ACTIVITIES- Section 305(a) of the Federal Home Loan Mortgage
 Corporation Act (12 U.S.C. 1454(a)) is amended by adding at the end the
 following new paragraph:
 `(5) The Corporation is authorized to lend on the security of, and to make
 commitments to lend on the security of, any mortgage that the Corporation is
 authorized to purchase under this section. The volume of the Corporation's
 lending activities and the establishment of its loan ratios, interest rates,
 maturities, and charges or fees in its secondary market operations under
 this paragraph, shall be determined by the Corporation from time to time;
 and such determinations shall be consistent with the objectives that the
 lending activities shall be conducted on such terms as will reasonably prevent
 excessive use of the Corporation's facilities, and that the operations of
 the Corporation under this paragraph shall be within its income derived from
 such operations and that such operations shall be fully self-supporting. The
 Corporation shall not be permitted to use its lending authority under this
 paragraph (A) to advance funds to a mortgage seller on an interim basis,
 using mortgage loans as collateral, pending the sale of the mortgages in
 the secondary market; or (B) to originate mortgage loans. Notwithstanding
 any Federal, State, or other law to the contrary, the Corporation is hereby
 empowered, in connection with any loan under this paragraph, whether before
 or after any default, to provide by contract with the borrower for the
 settlement or extinguishment, upon default, of any redemption, equitable,
 legal, or other right, title, or interest of the borrower in any mortgage
 or mortgages that constitute the security for the loan; and with respect to
 any such loan, in the event of default and pursuant otherwise to the terms
 of the contract, the mortgages that constitute such security shall become
 the absolute property of the Corporation.'.
 (f) REFERENCES TO FSLIC AND FHLBB-
 (1) SECTION 302- Section 302(b)(2) of the Federal National Mortgage
 Association Charter Act (12 U.S.C. 1717(b)(2)) is amended--
 (A) in the 4th sentence, by striking out `Federal Savings and Loan Insurance
 Corporation' and inserting in lieu thereof `Resolution Trust Corporation'; and
 (B) in the 8th sentence, by striking out `Federal Home Loan Bank Board'
 and inserting in lieu thereof `Federal Housing Finance Board'.
 (2) SECTION 305- Section 305 of the Federal Home Loan Mortgage Corporation
 Act (12 U.S.C. 1454) is amended--
 (A) by striking out `Federal Savings and Loan Insurance Corporation'
 each place it appears and inserting in lieu thereof `Resolution Trust
 Corporation'; and
 (B) in subsection (a)(2), by striking out `Federal Home Loan Bank Board'
 and inserting in lieu thereof `Federal Housing Finance Board'.
 (g) STANDBY CREDIT- Section 306(c) of the Federal Home Loan Mortgage
 Corporation Act (12 U.S.C. 1455(c)) is amended to read as follows:
 `(c)(1) The Secretary of the Treasury may purchase any obligations issued
 under subsection (a). For such purpose, the Secretary may use as a public debt
 transaction the proceeds of the sale of any securities issued under chapter
 31 of title 31, United States Code, and the purposes for which securities
 may be issued under such chapter are extended to include such purpose.
 `(2) The Secretary of Treasury shall not at any time purchase any obligations
 under this subsection if the purchase would increase the aggregate principal
 amount of the outstanding holdings of obligations under this subsection by
 the Secretary to an amount greater than $2,250,000,000.
 `(3) Each purchase of obligations by the Secretary of the Treasury under
 this subsection shall be upon terms and conditions established to yield a
 rate of return determined by the Secretary to be appropriate, taking into
 consideration the current average rate on outstanding marketable obligations
 of the United States as of the last day of the month preceding the making
 of the purchase.
 `(4) The Secretary of the Treasury may at any time sell, upon terms and
 conditions and at prices determined by the Secretary, any of the obligations
 acquired by the Secretary under this subsection.
 `(5) All redemptions, purchases and sales by the Secretary of the Treasury of
 obligations under this subsection shall be treated as public debt transactions
 of the United States.'.
 (h) PREFERRED STOCK- Section 306(f) of the Federal Home Loan Mortgage
 Corporation Act (12 U.S.C. 1455(f)) is amended to read as follows:
 `(f) The Corporation may have preferred stock on such terms and conditions
 as the Board of Directors shall prescribe. Any preferred stock shall not
 be entitled to vote with respect to the election of any member of the Board
 of Directors.'.
 (i) TERMS OF OBLIGATIONS- Section 306 of the Federal Home Loan Mortgage
 Corporation Act (12 U.S.C. 1455) is amended by adding at the end the
 following new subsections:
 `(j)(1) Any notes, debentures, or substantially identical types of unsecured
 obligations of the Corporation evidencing money borrowed, whether general
 or subordinated, shall be issued upon the approval of the Secretary of
 the Treasury and shall have such maturities and bear such rate or rates of
 interest as may be determined by the Corporation with the approval of the
 Secretary of the Treasury.
 `(2) Any notes, debentures, of substantially identical types of unsecured
 obligations of the Corporation having maturities of 1 year or less that the
 Corporation has issued or is issuing as of the date of the enactment of
 the Financial Institutions Reform, Recovery, and Enforcement Act of 1989
 shall be deemed to have been approved by the Secretary of the Treasury as
 required by this subsection. Such deemed approval shall expire 365 days
 after such date of enactment.
 `(3) Any notes, debentures, or substantially identical types of unsecured
 obligations of the Corporation having maturities of more than 1 year that
 the Corporation has issued or is issuing as of the date of the enactment of
 the Financial Institutions Reform, Recovery, and Enforcement Act of 1989
 shall be deemed to have been approved by the Secretary of the Treasury
 as required by this subsection. Such deemed approval shall expire 60 days
 after such date of enactment.
 `(k)(1) Any securities in the form of debt obligations or trust certificates
 of beneficial interest, or both, and based upon mortgages held and set aside
 by the Corporation, shall be issued upon the approval of the Secretary of
 the Treasury and shall have such maturities and shall bear such rate or
 rates of interest as may be determined by the Corporation with the approval
 of the Secretary of the Treasury.
 `(2) Any securities in the form of debt obligations or trust certificates of
 beneficial interest, or both, and based upon mortgages held and set aside
 by the Corporation, that the Corporation has issued or is issuing as of
 the date of the enactment of the Financial Institutions Reform, Recovery,
 and Enforcement Act of 1989 shall be deemed to have been approved by the
 Secretary of the Treasury as required by this subsection.'.
 (j) STATE LIMITATIONS-
 (1) The second sentence of section 307(a) of the Federal Home Loan Mortgage
 Corporation Act (12 U.S.C. 1456(a)) is amended to read as follows: `The
 Corporation is authorized to conduct its business without regard to any
 qualification or similar statute in any State.'.
 (2) The amendment made by this subsection shall not apply to any assertion
 of priority by the Federal Home Loan Mortgage Corporation with respect to any
 cause of action or claim filed before the date of the enactment of this Act.
 (k) PENAL PROVISIONS- Section 308 of the Federal Home Loan Mortgage
 Corporation Act (12 U.S.C. 1457) is amended--
 (1) in subsection (a), by striking the subsection designation; and
 (2) by striking subsections (b), (c), (d), (e), and (f).
 (l) CONSTRUCTION- Section 310 of the Federal Home Loan Mortgage Corporation
 Act (12 U.S.C. 1459) is amended--
 (1) in the section heading, by striking `CONSTRUCTION AND'; and
 (2) by striking the first sentence.
 (m) CONFORMING AMENDMENTS TO FEDERAL NATIONAL MORTGAGE ASSOCIATION CHARTER
 ACT-
 (1) STATEMENT OF PURPOSE- Section 301 of the Federal National Mortgage
 Association Charter Act (12 U.S.C. 1716) is amended--
 (A) by striking paragraphs (a) and (b) and inserting the following new
 paragraphs:
 `(1) provide stability in the secondary market for home mortgages;
 `(2) respond appropriately to the private capital market;
 `(3) provide ongoing assistance to the secondary market for home mortgages
 (including mortgages securing housing for low- and moderate-income families
 involving a reasonable economic return) by increasing the liquidity of
 mortgage investments and improving the distribution of investment capital
 available for home mortgage financing; and'; and
 (B) by redesignating paragraph (c) as paragraph (4).
 (2) LENDING ACTIVITIES- Section 304(a)(2) of the Federal National Mortgage
 Association Charter Act (12 U.S.C. 1719(a)(2)) is amended--
 (A) by inserting after the 3rd sentence the following new sentence:
 `The corporation shall not be permitted to use its lending authority (A)
 to advance funds to a mortgage seller on an interim basis, using mortgage
 loans as collateral, pending the sale of the mortgages in the secondary
 market; or (B) to originate mortgage loans.'; and
 (B) by striking the 1st and 2d sentences.
 (3) AUDITS BY GAO- Section 309 of the Federal National Mortgage Association
 Charter Act (12 U.S.C. 1723a) is amended by adding at the end the following
 new subsection:
 `(j) The mortgage transactions of the corporation may be subject to audit by
 the Comptroller General of the United States in accordance with the principles
 and procedures applicable to commercial corporation transactions under such
 rules and regulations as may be prescribed by the Comptroller General. The
 representatives of the General Accounting Office shall have access to such
 books, accounts, financial records, reports, files, and such other papers,
 things, or property belonging to or in use by the corporation and necessary
 to facilitate the audit, and they shall be afforded full facilities for
 verifying transactions with the balances or securities held by depositories,
 fiscal agents, and custodians. A report on each such audit shall be made
 by the Comptroller General to the Congress. The corporation shall reimburse
 the General Accounting Office for the full cost of any such audit as billed
 therefor by the Comptroller General.'.
Subtitle C--Technical and Conforming Amendments
SEC. 741. REPEAL OF LIMITATION OF OBLIGATION FOR ADMINISTRATIVE EXPENSES.
 Section 7(b) of the First Deficiency Appropriation Act of 1936 (15
 U.S.C. 712a(b)) is amended by striking the following:
 `1. Federal Home Loan Bank Board;';
 `2. Home Owners' Loan Corporation;'; and
 `11. Federal Savings and Loan Insurance Corporation;'.
SEC. 742. AMENDMENT OF TITLE 5, UNITED STATES CODE.
 (a) EXECUTIVE SCHEDULE-
 (1) Section 5314 of title 5, United States Code (5 U.S.C. 5315) is amended--
 (A) by striking
`Chairman of the Federal Home Loan Bank Board.'; and
 (B) by adding at the end thereof the following:
 `Director of the Office of Thrift Supervision.
 `Chairperson of the Federal Housing Finance Board.'.
 (2) Section 5315 of title 5, United States Code (5 U.S.C. 5315) is amended--
 (A) by striking out
`Members, Federal Home Loan Bank Board.', and
 (B) by inserting
`Directors, Federal Housing Finance Board.'.
 (b) LIMITATION ON PAY FIXED BY ADMINISTRATIVE ACTION- Section 5373(2) of title
 5, United States Code, is amended by inserting after `481,' the following:
 `1437, 1439,'.
 (c) DEFINITION OF AGENCY- Section 3132(a)(1) of title 5, United States Code
 (5 U.S.C. 3132(a)(1)), is amended--
 (1) in subparagraph (B), by striking `or' after the semicolon;
 (2) in subparagraph (C), by inserting `or' after the semicolon; and
 (3) by adding at the end the following:
 `(D) the Office of the Comptroller of the Currency, the Office of Thrift
 Supervision, the Federal Housing Finance Board, the Resolution Trust
 Corporation, and the National Credit Union Administration;'.
SEC. 743. AMENDMENT OF BALANCED BUDGET AND EMERGENCY DEFICIT CONTROL ACT
PROVISIONS.
 (a) Section 255(g)(1)(A) of the Balanced Budget and Emergency Deficit
 Control Act of 1985 (2 U.S.C. 905(g)(1)(A)) is amended--
 (1) by inserting after the item relating to the Comptroller of the Currency
 the following new item:
 `Director of the Office of Thrift Supervision;';
 (2) by striking out `Federal Home Loan Bank Board;' and inserting in lieu
 thereof the following new items:
 `Federal Deposit Insurance Corporation, Bank Insurance Fund;
 `Federal Deposit Insurance Corporation, FSLIC Resolution Fund;
 `Federal Deposit Insurance Corporation, Savings Association Insurance Fund;';
 (3) by striking out `Federal Home Loan Bank Board, Federal Savings and
 Loan Insurance Corporation' and inserting in lieu thereof `Federal Housing
 Finance Board'; and
 (4) by inserting after the item relating to the Postal service fund the
 following new items:
 `Resolution Funding Corporation;
 `Resolution Trust Corporation;'.
 (b) Section 256(b)(4) of the Balanced Budget and Emergency Deficit Control
 Act of 1985 (2 U.S.C. 256(b)(4)) is amended--
 (1) by striking out subparagraph (C) and inserting in lieu thereof the
 following new subparagraph
 `(C) Office of Thrift Supervision.';
 (2) by striking subparagraph (D) and inserting in lieu thereof the following
 new subparagraph:
 `(D) Office of Thrift Supervision.'; and
 (3) by adding at the end thereof the following new subparagraphs:
 `(H) Resolution Funding Corporation.
 `(I) Resolution Trust Corporation.'.
 (c) Section 255(g)(2) of the Balanced Budget and Emergency Deficit Control
 Act of 1985 is amended by striking `Federal Savings and Loan Insurance
 Corporation fund (82-4037-0-3-371);'.
SEC. 744. CONFORMING AMENDMENTS TO FINANCIAL INSTITUTION RELATED ACTS.
 (a) FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL ACT-
 (1) SECTION 1003- Section 1003 of the Federal Financial Institutions
 Examination Council Act of 1978 (12 U.S.C. 3302) is amended--
 (A) in paragraph (1), by striking out `Federal Home Loan Bank Board' and
 inserting in lieu thereof `Office of Thrift Supervision'; and
 (B) in paragraph (3), by striking out `savings and loan association' and
 inserting in lieu thereof `savings association'.
 (2) SECTION 1004- Section 1004(a)(4) of the Federal Financial Institutions
 Examination Council Act of 1978 (12 U.S.C. 3303(a)(4)) is amended by striking
 out `Chairman of the Federal Home Loan Bank Board, and' and inserting in
 lieu thereof `Director, Office of Thrift Supervision'.
 (3) SECTION 1006- Section 1006(d) of the Federal Financial Institutions
 Examination Council Act of 1978 (12 U.S.C. 3305(d)) is amended in the 2d
 sentence by inserting `and employees of the Federal Housing Finance Board'
 after `supervisory agencies'.
 (b) RIGHT TO FINANCIAL PRIVACY ACT- Section 1101 of the Right to Financial
 Privacy Act of 1978 (12 U.S.C. 3401) is amended--
 (1) in paragraph (1), by striking out `savings and loan' and inserting in
 lieu thereof `savings association';
 (2) in paragraph (6), by striking out subparagraph (B) and redesignating the
 remaining subparagraphs as subparagraphs (B) through (H), respectively; and
 (3) in paragraph (6)(B) (as so redesignated), by striking out `the Federal
 Home Loan Bank Board' and inserting in lieu thereof `Director, Office of
 Thrift Supervision'.
 (c) ALTERNATIVE MORTGAGE TRANSACTIONS PARITY ACT- The Alternative Mortgage
 Transactions Parity Act of 1982 (12 U.S.C. 3801-06) is amended by striking
 out `Federal Home Loan Bank Board' each place such term appears and inserting
 in lieu thereof `Director of the Office of Thrift Supervision'.
 (d) EXPEDITED FUNDS AVAILABILITY ACT- Section 610(a)(2) of the Expedited
 Funds Availability Act (12 U.S.C. 4009(a)(2)) is amended to read as follows:
 `(2) section 8 of the Federal Deposit Insurance Act, by the Director of the
 Office of Thrift Supervision in the case of savings associations the deposits
 of which are insured by the Federal Deposit Insurance Corporation; and'.
 (e) PAPERWORK REDUCTION ACT- Section 2(a)(10) of the Paperwork Reduction Act
 of 1980 (44 U.S.C. 3502(a)(10)) is amended by striking out `Federal Home Loan
 Bank Board' and inserting in lieu thereof `the Federal Housing Finance Board'.
 (f) FEDERAL PROPERTY AND ADMINISTRATIVE SERVICES ACT- Section 602(11) of the
 Federal Property and Administrative Services Act of 1949 (40 U.S.C. 474(11))
 is amended--
 (1) by inserting `or the Resolution Trust Corporation' after `Department
 of Housing and Urban Development';
 (2) by striking out `savings and loan accounts' and inserting in lieu thereof
 `savings association accounts'; and
 (3) by inserting `under the Federal Deposit Insurance Act or any other
 law.' after `National Housing Act'.
 (g) PUBLIC BUILDINGS ACT- Section 13(4) of the Public Buildings Act of 1959
 (40 U.S.C. 612(d)) is amended by striking out subparagraph (D).
 (h) BANK PROTECTION ACT- Section 2 of the Bank Protection Act of 1968
 (12 U.S.C. 1881) is amended--
 (1) in paragraph (4), by--
 (A) striking out `Federal Home Loan Bank Board' and inserting in lieu thereof
 `Director of the Office of Thrift Supervision';
 (B) striking out `and loan'; and
 (C) striking `associations' and all that follows through `Corporation'; and
 (2) in paragraph (3), by inserting `and State savings associations' before
 `, and'.
 (i) THE FEDERAL RESERVE ACT-
 (1) SECTION 11- Section 11(a)(2) of the Federal Reserve Act (12
 U.S.C. 248(a)(2)) is amended by striking `(iii) Federal Home Loan Bank
 Board in the case of any institution insured by the Federal Savings and
 Loan Insurance Corporation' and inserting `(iii) the Director of the Office
 of Thrift Supervision in the case of any savings association which is an
 insured depository institution (as defined in section 3 of the Federal
 Deposit Insurance Act)'.
 (2) SECTION 19(b)- Section 19(b)(1)(A)(vi) of the Federal Reserve Act
 (12 U.S.C. 461(b)(1)(A)(vi)) is amended to read as follows:
 `(vi) any savings association (as defined in section 3 of the Federal Deposit
 Insurance Act) which is an insured depository institution (as defined in
 such Act) or is eligible to apply to become an insured depository institution
 under the Federal Deposit Insurance Act; and'.
 (3) SECTION 19- Section 19 of the Federal Reserve Act (12 U.S.C. 461) is
 amended by striking out `the Federal Home Loan Bank Board,' and inserting
 in lieu thereof `the Director of the Office of Thrift Supervision,' each
 place it appears.
 (j) PUBLIC LAW 93-495- Section 3 of title I of Public Law 93-495 (12
 U.S.C. 250) is amended by striking `Federal Home Loan Bank Board' and
 inserting `Director of the Office of Thrift Supervision'.
 (k) TRUTH IN LENDING ACT- Section 108(a)(2) of the Truth in Lending Act
 (15 U.S.C. 1607(a)(2)) is amended to read as follows:
 `(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.'.
 (l) FAIR CREDIT REPORTING ACT- Section 621(b)(2) of the Fair Credit Reporting
 Act (15 U.S.C. 1681s(b)(2)) is amended to read as follows:
 `(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;'.
 (m) EQUAL CREDIT OPPORTUNITY ACT- Section 704(a)(2) of the Equal Credit
 Opportunity Act (15 U.S.C. 1691c(a)(2)) is amended to read as follows:
 `(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.'.
 (n) FAIR DEBT COLLECTION PRACTICES ACT- Section 814(b)(2) of the Fair
 Debt Collection Practices Act (15 U.S.C. 1692l(b)(2)) is amended to read
 as follows:
 `(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;'.
 (o) ELECTRONIC FUND TRANSFER ACT- Section 917(a)(2) of the Electronic Fund
 Transfer Act (15 U.S.C. 1693o(a)(2)) is amended to read as follows:
 `(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;'.
 (p) HOME MORTGAGE DISCLOSURE ACT OF 1975-
 (1) SECTION 305- Section 305(b)(2) of the Home Mortgage Disclosure Act of
 1975 (12 U.S.C. 2804(b)(2)) is amended to read as follows:
 `(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'.
 (2) SECTION 306- Section 306(b)(2) of the Home Mortgage Disclosure Act of
 1975 (12 U.S.C. 2805(b)(2)) is amended to read as follows:
 `(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.'.
 (3) SECTION 307- Section 307 of the Home Mortgage Disclosure Act of 1975
 (12 U.S.C. 2806) is amended by striking `Federal Home Loan Bank Board' each
 place it appears and inserting `Director of the Office of Thrift Supervision'.
 (q) COMMUNITY REINVESTMENT ACT OF 1977- Section 803(1)(D) of the Community
 Reinvestment Act of 1977 (12 U.S.C. 2902(1)(D)) is amended to read as follows:
 `(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;'.
 (r) DEPOSITORY INSTITUTIONS MANAGEMENT INTERLOCKS ACT-
 (1) Section 207(4) of the Depository Institutions Management Interlocks Act
 (12 U.S.C. 3206(4)) is amended to read as follows:
 `(4) the Director of the Office of Thrift Supervision with respect to
 a savings association (the deposits of which are insured by the Federal
 Deposit Insurance Corporation) and savings and loan holding companies,'.
 (s) DEPOSITORY INSTITUTIONS DEREGULATION ACT OF 1980- Section 208(a)(2) of
 the Depository Institutions Deregulation Act of 1980 (12 U.S.C. 3507(a)(2))
 is amended to read as follows:
 `(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.'.
 (t) FEDERAL TRADE COMMISSION ACT- Section 18(f)(3) of the Federal Trade
 Commission Act (15 U.S.C. 57a(f)(3)) is amended to read as follows:
 `(3) Compliance with regulations prescribed under this subsection shall be
 enforced under section 8 of the Federal Deposit Insurance Act with respect
 to savings associations as defined in section 3 of the Federal Deposit
 Insurance Act.'.
 (u) SECURITIES EXCHANGE ACT OF 1934-
 (1) SECTION 3- Section 3(a)(34) of the Securities Exchange Act of 1934
 (15 U.S.C. 78c(a)(34)) is amended--
 (A) in subparagraph (G)--
 (i) by striking clauses (iv) and (v) and inserting the following:
 `(iv) 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
 (ii) by redesignating clause (vi) as clause (v); and
 (B) in the second sentence, by striking `the Federal Home Loan Bank Board'
 and inserting `the Office of Thrift Supervision'.
 (2) SECTION 12- Section 12(i) of the Securities Exchange Act of 1934 (15
 U.S.C. 78l(i)) is amended--
 (A) in the first sentence--
 (i) by inserting `and savings associations' after `banks' the first place
 it appears;
 (ii) by striking `or institutions the accounts of which are insured by the
 Federal Savings and Loan Insurance Corporation'; and
 (iii) by striking paragraph (4) and inserting `(4) with respect to savings
 associations the accounts of which are insured by the Federal Deposit
 Insurance Corporation are vested in the Office of Thrift Supervision'; and
 (B) in the second sentence, by striking `the Federal Home Loan Bank Board'
 and inserting `the Office of Thrift Supervision'.
 (3) SECTION 15- Section 15C(f)(1) (15 U.S.C. 78o-5(f)(1)) of such Act is
 amended by striking `Federal Home Loan Bank Board' and inserting `Director
 of the Office of Thrift Supervision'.
TITLE VIII--BANK CONSERVATION ACT AMENDMENTS
SEC. 801. DEFINITIONS.
 Section 202 of the Bank Conservation Act (12 U.S.C. 202) is amended--
 (1) by inserting after `national banking association' the following:
 `or any other financial institution chartered or licensed under Federal
 law and subject to the supervision of the Comptroller of the Currency'; and
 (2) by inserting before `and the term `State' ' the following: `the term
 `voluntary dissolution and liquidation' means a transaction pursuant to
 section 5220 of the Revised Statutes that involves the assumption of the
 bank's insured deposit liabilities and the sale of the bank, or of control
 of the bank, as a going concern;'.
SEC. 802. APPOINTMENT OF CONSERVATOR.
 Section 203 of the Bank Conservation Act (12 U.S.C. 203) is amended to read
 as follows:
`SEC. 203. APPOINTMENT OF CONSERVATOR.
 `(a) APPOINTMENT- The Comptroller of the Currency may, without notice
 or prior hearing, appoint a conservator, which may be the Federal Deposit
 Insurance Corporation, to take possession and control of a bank whenever the
 Comptroller determines that one or more of the following circumstances exist:
 `(1) any one or more of the conditions for appointment of a receiver for
 the bank specified in the first section of the Act of June 30, 1876 (12
 U.S.C. 191) are present;
 `(2) the bank is not likely to be able to meet the demands of its depositors
 or pay its obligations in the normal course of business;
 `(3) the bank is in an unsafe or unsound condition to transact business,
 including having substantially insufficient capital or otherwise;
 `(4)(A) the bank has incurred or is likely to incur losses that will deplete
 all or substantially all of its capital, and
 `(B) there is no reasonable prospect for the bank's capital to be replenished
 without Federal assistance;
 `(5) there is a violation or violations of laws, rules, or regulations,
 or any unsafe or unsound practice or condition which is likely to cause
 insolvency or substantial dissipation of assets or earnings, or is likely to
 weaken the bank's condition or otherwise seriously prejudice the interests
 of its depositors;
 `(6) there is concealment of books, papers, records, or assets of the bank,
 or refusal to submit books, papers, records, or affairs of the bank for
 inspection to any examiner or to any lawful agent of the Comptroller;
 `(7) there is a willful or continuing violation of an order enforceable
 against the bank under section 8(i) of the Federal Deposit Insurance Act; or
 `(8) the bank's board of directors consists of fewer than 5 members.
 `(b) JUDICIAL REVIEW-
 `(1) IN GENERAL- Not later than 20 days after the initial appointment of a
 conservator pursuant to this section, the bank may bring an action in the
 United States district court for the judicial district in which the home
 office of such bank is located, or in the United States District Court
 for the District of Columbia, for an order requiring the Comptroller to
 terminate the appointment of the conservator, and the court, upon the merits,
 shall dismiss such action or shall direct the Comptroller to terminate the
 appointment of such conservator. The Comptroller's decision to appoint a
 conservator pursuant to this section shall be set aside only if the court
 finds that such decision was arbitrary, capricious, an abuse of discretion,
 or otherwise not in accordance with law.
 `(2) STAY- The conservator may request that any judicial action or proceeding
 to which the conservator or the bank is or may become a party be stayed for
 a period of up to 45 days after the appointment of the conservator. Upon
 petition, the court shall grant such stay as to all parties.
 `(3) ACTIONS AND ORDERS- Except as otherwise provided in this subsection,
 no court may take any action regarding the removal of a conservator, or
 restrain, or affect the exercise of powers or functions of a conservator. A
 court, upon application by the Comptroller, shall have jurisdiction to
 enforce an order of the Comptroller relating to--
 `(A) the conservatorship and the bank in conservatorship, or
 `(B) restraining or affecting the exercise of powers or functions of
 a conservator.
 `(c) ADDITIONAL GROUNDS FOR APPOINTMENT- In addition to the foregoing
 provisions, the Comptroller may appoint a conservator for a bank if--
 `(1) the bank, by an affirmative vote of a majority of its board of directors
 or by an affirmative vote of a majority of its shareholders, consents to
 such appointment, or
 `(2) the Federal Deposit Insurance Corporation terminates the bank's status
 as an insured bank.
The appointment of a conservator pursuant to this subsection shall not be
subject to review.
 `(d) EXCLUSIVE AUTHORITY- The Comptroller shall have exclusive power and
 jurisdiction to appoint a conservator for a bank. Whenever the Comptroller
 appoints a conservator for any bank, the Comptroller may appoint the
 Federal Deposit Insurance Corporation conservator for such bank. The
 Federal Deposit Insurance Corporation, as such conservator, shall have all
 the powers granted under the Federal Deposit Insurance Act, and (when not
 inconsistent therewith) any other rights, powers, and privileges possessed
 by conservators of banks under this Act and any other provision of law. The
 Comptroller may also appoint another person as conservator, who shall be
 subject to the provisions of this Act.
 `(e) REPLACEMENT OF CONSERVATOR- The Comptroller may, without notice or
 hearing, replace a conservator with another conservator. Such replacement
 shall not affect the bank's right under subsection (b) to obtain judicial
 review of the Comptroller's original decision to appoint a conservator.'.
SEC. 803. EXAMINATIONS.
 Section 204 of the Bank Conservation Act (12 U.S.C. 204) is amended to read
 as follows:
`SEC. 204. EXAMINATIONS.
 `The Comptroller of the Currency (in consultation with the Board of
 Directors of the Federal Deposit Insurance Corporation when the Corporation
 is appointed conservator) is authorized to examine and supervise the bank
 in conservatorship as long as the bank continues to operate as a going
 concern. The Comptroller may use reports and other information provided by
 the Federal Deposit Insurance Corporation for this purpose.'.
SEC. 804. TERMINATION OF CONSERVATORSHIP.
 Section 205 of the Bank Conservation Act (12 U.S.C. 205) is amended to read
 as follows:
`SEC. 205. TERMINATION OF CONSERVATORSHIP.
 `(a) GENERAL RULE- At any time the Comptroller becomes satisfied that it may
 safely be done and that it would be in the public interest, the Comptroller
 (with the agreement of the Board of Directors of the Federal Deposit Insurance
 Corporation when the Corporation has been appointed conservator) may--
 `(1) terminate the conservatorship and permit the involved bank to resume
 the transaction of its business subject to such terms, conditions, and
 limitations as the Comptroller may prescribe; or
 `(2) terminate the conservatorship upon a sale, merger, consolidation,
 purchase and assumption, change in control, or voluntary dissolution and
 liquidation of the involved bank.
 `(b) OTHER GROUNDS FOR TERMINATION- The Comptroller also may terminate the
 conservatorship upon the appointment of a receiver pursuant to the first
 section of the Act of June 30, 1876 (12 U.S.C. 191).
 `(c) ENFORCEMENT UNDER FEDERAL DEPOSIT INSURANCE ACT- Such terms, conditions,
 and limitations as may be prescribed under subsection (a)(1) shall be
 enforceable under the provisions of section 8(i) of the Federal Deposit
 Insurance Act, to the same extent as an order issued pursuant to section
 8(b) of the Federal Deposit Insurance Act which has become final. The bank
 may bring an action in the United States district court for the judicial
 district in which the home office of such bank is located or in the United
 States District Court for the District of Columbia for an order requiring
 the Comptroller to terminate the order. An action for judicial review of the
 terms, conditions, and limitations may not be commenced later than 20 days
 from the date of the termination of the conservatorship or the imposition
 of the order, whichever is later.
 `(d) ACTION UPON TERMINATION-
 `(1) IN GENERAL- Upon termination of the conservatorship under subsection
 (a)(2), the Federal Deposit Insurance Corporation, as conservator, or when
 another person is appointed conservator, such other person, shall conclude
 the affairs of the conservatorship in accordance with paragraph (2).
 `(2) DEPOSIT AND DISTRIBUTION OF PROCEEDS- (A) Within 180 days of the
 sale, merger, consolidation, purchase and assumption, change in control,
 or voluntary dissolution and liquidation, the conservator shall deposit all
 net proceeds received from the transaction, less any outstanding expenses of
 the conservatorship, with the United States district court for the judicial
 district in which the home office of such bank is located and shall cause
 notice to be published for three consecutive months and notify by mail all
 known and remaining creditors and shareholders. Within 60 days thereafter,
 any depositor, creditor, or other claimant of the bank, or any shareholder of
 the bank may bring an action in interpleader in that court for distribution
 of the proceeds. The district court shall distribute such funds equitably. If
 no such action is instituted within one year after the date the funds are
 deposited with the district court, title to such net proceeds shall revert
 to the United States and the district court shall remit the funds to the
 Treasury of the United States.
 `(B) The conservator shall be deemed to have discharged all responsibility
 of the conservatorship upon the deposit of the proceeds with the district
 court and giving the required notifications.'.
SEC. 805. CONSERVATOR; POWERS AND DUTIES.
 Section 206 of the Bank Conservation Act (12 U.S.C. 206) is amended to read
 as follows:
`SEC. 206. CONSERVATOR; POWERS AND DUTIES.
 `(a) GENERAL POWERS- A conservator shall have all the powers of the
 shareholders, directors, and officers of the bank and may operate the bank
 in its own name unless the Comptroller in the order of appointment limits
 the conservator's authority.
 `(b) SUBJECT TO RULES OF COMPTROLLER- The conservator shall be subject to
 such rules, regulations, and orders as the Comptroller from time to time
 deems appropriate; and, except as otherwise specifically provided in such
 rules, regulations, or orders or in section 209 of this Act, shall have the
 same rights and privileges and be subject to the same duties, restrictions,
 penalties, conditions, and limitations as apply to directors, officers,
 or employees of a national bank.
 `(c) PAYMENT OF DEPOSITORS AND CREDITORS- The Comptroller may require the
 conservator to set aside and make available for withdrawal by depositors and
 payment to other creditors such amounts as in the opinion of the Comptroller
 may safely be used for that purpose. All depositors and creditors who are
 similarly situated shall be treated in the same manner.
 `(d) COMPENSATION OF CONSERVATOR AND EMPLOYEES- The conservator and
 professional employees appointed to represent or assist the conservator shall
 not be paid amounts greater than are payable to employees of the Federal
 Government for similar services, except that the Comptroller of the Currency
 may authorize payment at higher rates (but not in excess of rates prevailing
 in the private sector), if the Comptroller determines that paying such
 higher rates is necessary in order to recruit and retain competent personnel.
 `(e) EXPENSES- All expenses of any such conservatorship shall be paid by
 the bank and shall be a lien upon the bank which shall be prior to any
 other lien.'.
SEC. 806. LIABILITY PROTECTION.
 Section 209 of the Bank Conservation Act (12 U.S.C. 209) is amended to read
 as follows:
`SEC. 209. LIABILITY PROTECTION.
 `(a) FEDERAL AGENCY AND EMPLOYEES- In any case in which the conservator is a
 Federal agency or an employee of the Government, the provisions of chapters
 161 and 171 of title 28, United States Code, shall apply with respect to
 such conservator's liability for acts or omissions performed pursuant to
 and in the course of the duties and responsibilities of the conservatorship.
 `(b) OTHER CONSERVATORS- In any case where the conservator is not a
 conservator described in subsection (a), the conservator shall not be
 liable for damages in tort or otherwise for acts or omissions performed
 pursuant to and in the course of the duties and responsibilities of the
 conservatorship, unless such acts or omissions constitute gross negligence,
 including any similar conduct or any form of intentional tortious conduct,
 as determined by a court.
 `(c) INDEMNIFICATION- The Comptroller shall have authority to indemnify
 the conservator on such terms as the Comptroller deems proper.'.
SEC. 807. RULES AND REGULATIONS.
 Section 211 of the Bank Conservation Act (12 U.S.C. 211) is amended to read
 as follows:
`SEC. 211. RULES AND REGULATIONS.
 `(a) IN GENERAL- The Comptroller of the Currency may prescribe such rules
 and regulations as the Comptroller may deem necessary to carry out the
 provisions of this Act.
 `(b) F.D.I.C. AS CONSERVATOR- In any case in which the Federal Deposit
 Insurance Corporation is the conservator, any rules or regulations prescribed
 by the Comptroller shall be consistent with any rules and regulations
 prescribed by the Federal Deposit Insurance Corporation pursuant to the
 Federal Deposit Insurance Act.'.
SEC. 808. REPEALS.
 Sections 207 and 208 of the Bank Conservation Act (12 U.S.C. 207 and 208)
 are repealed.
TITLE IX--REGULATORY ENFORCEMENT AUTHORITY AND CRIMINAL ENHANCEMENTS
Subtitle A--Expanded Enforcement Powers, Increased Penalties, and Improved
Accountability
SEC. 901. INSTITUTION-AFFILIATED PARTIES OF A DEPOSITORY INSTITUTION SUBJECT
TO ADMINISTRATIVE ENFORCEMENT ORDERS; SUBSTITUTION OF `DEPOSITORY INSTITUTION'
FOR `BANK' IN ENFORCEMENT PROVISIONS.
 (a) INSTITUTION-AFFILIATED PARTY DEFINED- Section 206 of the Federal Credit
 Union Act (12 U.S.C. 1786) is amended by adding at the end thereof the
 following new subsection:
 `(r) INSTITUTION-AFFILIATED PARTY DEFINED- For purposes of this Act, the term
 `institution-affiliated party' means--
 `(1) any committee member, director, officer, or employee of, or agent for,
 an insured credit union;
 `(2) any consultant, joint venture partner, and any other person as determined
 by the Board (by regulation or on a case-by-case basis) who participates
 in the conduct of the affairs of an insured credit union; and
 `(3) any independent contractor (including any attorney, appraiser, or
 accountant) who knowingly or recklessly participates in--
 `(A) any violation of any law or regulation;
 `(B) any breach of fiduciary duty; or
 `(C) any unsafe or unsound practice,
which caused or is likely to cause more than a minimal financial loss to,
or a significant adverse effect on, the insured credit union.'.
 (b) AMENDMENTS RELATING TO USE OF `INSTITUTION-AFFILIATED PARTY'-
 (1) FDIA- Section 8 of the Federal Deposit Insurance Act (12 U.S.C. 1818)
 is amended--
 (A) in subsection (b)(1)--
 (i) by striking out `director, officer, employee, agent, or other person
 participating in the conduct of the affairs of such a bank' and inserting
 in lieu thereof `institution-affiliated party'; and
 (ii) by striking out `directors, officers, employees, agents, or other
 persons participating in the conduct of the affairs of such bank' and
 inserting in lieu thereof `institution-affiliated parties';
 (B) in each of subsections (b)(1) and (c)--
 (i) by striking out `director, officer, employee, agent, or other person
 participating in the conduct of the affairs of such bank' each place such
 term appears and inserting in lieu thereof `institution-affiliated party'; and
 (ii) by striking out `such director, officer, employee, agent, or other
 person' each place such term appears and inserting in lieu thereof `such
 party';
 (C) in subsection (e)(4), as so redesignated by section 903(a)(2) of
 this Act--
 (i) by striking out `a director, officer, or other person from office
 or to prohibit his participation' and inserting in lieu thereof `an
 institution-affiliated party from office or to prohibit such party from
 participating';
 (ii) by striking out `such director or officer or other person' and inserting
 in lieu thereof `such party';
 (iii) by striking out `such director, officer, or other person' and inserting
 in lieu thereof `such party';
 (iv) by striking out `he' and inserting in lieu thereof `such party';
 (v) by striking out `any director, officer or other person' and inserting
 in lieu thereof `any such party'; and
 (vi) by striking out `the director, officer, or other person concerned'
 and inserting in lieu thereof `such party';
 (D) in subsection (e)(5), as so redesignated by section 903(a)(2) of
 this Act--
 (i) by inserting after `the term `officer' ' the following: `within the term
 `institution-affiliated party' '; and
 (ii) by inserting after `the term `director' ' the following: `within the
 term `institution-affiliated party' as used in this subsection';
 (E) in subsection (f)--
 (i) by striking out `any director, officer, or other person' and inserting
 in lieu thereof `any institution-affiliated party'; and
 (ii) by striking out `such director, officer, or other person' each place
 such term appears and inserting in lieu thereof `such party';
 (F) in subsection (g)(1)--
 (i) by striking out `director or officer of an insured bank, or other person
 participating in the conduct of the affairs of such bank' and inserting in
 lieu thereof `institution-affiliated party';
 (ii) by striking out `the individual' each place such term appears and
 inserting in lieu thereof `such party';
 (iii) by striking out `such director, officer, or other person' each place
 such term appears and inserting in lieu thereof `such party';
 (iv) by striking out `him' each place such term appears and inserting in
 lieu thereof `such party';
 (v) by striking out `director, officer or other person' and inserting in
 lieu thereof `party'; and
 (vi) by striking out `whereupon such director or officer' and inserting in
 lieu thereof `whereupon such party (if a director or an officer)';
 (G) in subsection (g)(3)--
 (i) by striking out `the director, officer, or other person concerned'
 and inserting in lieu thereof `the institution-affiliated party concerned';
 (ii) by striking out `such individual' each place such term appears and
 inserting in lieu thereof `such party';
 (iii) by striking out `the concerned director, officer, or other person'
 and inserting in lieu thereof `such party';
 (iv) by striking out `the director, officer, or other person' each place such
 term appears (except in `the director, officer, or other person concerned')
 and inserting in lieu thereof `such party';
 (v) by striking out `said director, officer or other person' and inserting
 in lieu thereof `such party'; and
 (vi) by striking out `the director, officer or other person' and inserting
 in lieu thereof `such party';
 (H) in subsection (h)(2), by striking out `director or officer or other
 person' and inserting in lieu thereof `institution-affiliated party';
 (I) in subsection (l), by striking out `director or officer thereof or other
 person participating in the conduct of its affairs' and inserting in lieu
 thereof `institution-affiliated party'; and
 (J) in subsection (m), by striking out `director or officer or other person
 participating in the conduct of its affairs' and inserting in lieu thereof
 `institution-affiliated party'.
 (2) FCUA- Section 206 of the Federal Credit Union Act (12 U.S.C. 1786)
 is amended--
 (A) in subsection (e)(1)--
 (i) by striking out `director, officer, committee member, employee, agent,
 or other person participating in the conduct of the affairs of such a credit
 union' and inserting in lieu thereof `institution-affiliated party'; and
 (ii) by striking out `directors, officers, committee members, employees,
 agents, or other persons participating in the conduct of the affairs of such
 credit union' and inserting in lieu thereof `institution-affiliated parties';
 (B) in each of subsections (e)(1) and (f)--
 (i) by striking out `director, officer, committee member, employee,
 agent, or other person participating in the conduct of the affairs of such
 credit union' each place such term appears and inserting in lieu thereof
 `institution-affiliated party'; and
 (ii) by striking out `such director, officer, committee member, employee,
 agent, or other person' each place such term appears and inserting in lieu
 thereof `such party'; and
 (C) in subsection (f)(1), by striking out `such director, officer, committee
 member, employee, agents, or other person' and inserting in lieu thereof
 `such party';
 (D) in subsection (i)(1)--
 (i) by striking out `director, committee member, or officer of an insured
 credit union, or other person participating in the conduct of the affairs
 of such credit union' and inserting in lieu thereof `institution-affiliated
 party';
 (ii) by striking out `the individual' each place such term appears and
 inserting in lieu thereof `such party';
 (iii) by striking out `such director, committee member, officer, or other
 person' each place such term appears and inserting in lieu thereof `such
 party';
 (iv) by striking out `him' and inserting in lieu thereof `such party';
 (v) by striking out `director, officer or other person' and inserting in
 lieu thereof `party'; and
 (vi) by striking out `whereupon such director, committee member, or officer'
 and inserting in lieu thereof `whereupon such party (if a director, a
 committee member, or an officer)';
 (E) in subsection (i)(3)--
 (i) by striking out `director, committee member, officer, or other person
 concerned' and inserting in lieu thereof `institution-affiliated party
 concerned'; and
 (ii) by striking out `such individual' each place such term appears and
 inserting in lieu thereof `such party';
 (iii) by striking out `the concerned director, committee member, officer,
 or other person' and inserting in lieu thereof `such party';
 (iv) by striking out `the director, committee member, officer, or other
 person' each place such term appears (except in `the director, committee
 member, officer, or other person concerned') and inserting in lieu thereof
 `such party'; and
 (v) by striking out `said director, committee member, officer or other
 person' and inserting in lieu thereof `such party';
 (F) in subsection (j)(2), by striking out `director, officer, committee
 member, or other person' and inserting in lieu thereof `institution-affiliated
 party'; and
 (G) in subsection (o), by striking out `director, officer, committee member
 or other person participating in the conduct of its affairs' and inserting
 in lieu thereof `institution-affiliated party'.
 (d) SUBSTITUTION OF `DEPOSITORY INSTITUTION' FOR `BANK'- Section 8 of the
 Federal Deposit Insurance Act (12 U.S.C. 1818), as amended by subsection
 (b)(1) of this section, is amended by striking out `bank' and `banks' each
 place such terms appear and inserting in lieu thereof `depository institution'
 and `depository institutions', respectively, except in subsections (b)(3),
 (b)(4), (m), (o), and (r).
SEC. 902. AMENDMENTS TO CEASE AND DESIST AUTHORITY WITH RESPECT TO RESTITUTION,
RESTRICTIONS ON SPECIFIC ACTIVITIES, GROUNDS FOR ISSUANCE OF A TEMPORARY
ORDER, AND INCOMPLETE OR INACCURATE RECORDS.
 (a) DEPOSITORY INSTITUTIONS INSURED BY THE FDIC-
 (1) CEASE AND DESIST AUTHORITY- Section 8(b) of the Federal Deposit Insurance
 Act (12 U.S.C. 1818(b)) is amended--
 (A) in paragraph (3), by striking out `subsections (c) through (f) and (h)
 through (n)' and inserting in lieu thereof `subsections (c) through (s)
 and subsection (u)';
 (B) in paragraph (4), by striking out `subsections (c) through (f) and (h)
 through (n)' and inserting in lieu thereof `subsections (c) through (s)
 and subsection (u)'; and
 (C) by adding at the end thereof the following new paragraphs:
 `(6) AFFIRMATIVE ACTION TO CORRECT CONDITIONS RESULTING FROM VIOLATIONS
 OR PRACTICES- The authority to issue an order under this subsection and
 subsection (c) which requires an insured depository institution or any
 institution-affiliated party to take affirmative action to correct any
 conditions resulting from any violation or practice with respect to which
 such order is issued includes the authority to require such depository
 institution or such party to--
 `(A) make restitution or provide reimbursement, indemnification, or guarantee
 against loss if--
 `(i) such depository institution or such party was unjustly enriched in
 connection with such violation or practice; or
 `(ii) the violation or practice involved a reckless disregard for the law
 or any applicable regulations or prior order of the appropriate Federal
 banking agency;
 `(B) restrict the growth of the institution;
 `(C) dispose of any loan or asset involved;
 `(D) rescind agreements or contracts; and
 `(E) employ qualified officers or employees (who may be subject to approval by
 the appropriate Federal banking agency at the direction of such agency); and
 `(F) take such other action as the banking agency determines to be
 appropriate.
 `(7) AUTHORITY TO LIMIT ACTIVITIES- The authority to issue an order under
 this subsection or subsection (c) includes the authority to place limitations
 on the activities or functions of an insured depository institution or any
 institution-affiliated party.
 `(8) EXPANSION OF AUTHORITY TO SAVINGS AND LOAN AFFILIATES AND ENTITIES-
 Subsections (a) through (s) and subsection (u) shall apply to any savings
 and loan holding company and to any subsidiary (other than a bank or
 subsidiary of that bank) of a savings and loan holding company, to any
 service corporation of a savings association and to any subsidiary of such
 service corporation, whether wholly or partly owned, in the same manner as
 such subsections apply to a savings association.'.
 (2) TEMPORARY CEASE AND DESIST AUTHORITY- Section 8(c) of the Federal
 Deposit Insurance Act (12 U.S.C. 1818(c)) is amended--
 (A) in paragraph (1)--
 (i) by striking out `substantial' and inserting in lieu thereof `significant';
 (ii) by striking out `seriously' each place such term appears; and
 (iii) by inserting after the 1st sentence the following new sentence: `Such
 order may include any requirement authorized under subsection (b)(6)(B).'; and
 (B) by adding at the end thereof the following new paragraph:
 `(3) INCOMPLETE OR INACCURATE RECORDS-
 `(A) TEMPORARY ORDER- If a notice of charges served under subsection (b)(1)
 specifies, on the basis of particular facts and circumstances, that an insured
 depository institution's books and records are so incomplete or inaccurate
 that the appropriate Federal banking agency is unable, through the normal
 supervisory process, to determine the financial condition of that depository
 institution or the details or purpose of any transaction or transactions
 that may have a material effect on the financial condition of that depository
 institution, the agency may issue a temporary order requiring--
 `(i) the cessation of any activity or practice which gave rise, whether
 in whole or in part, to the incomplete or inaccurate state of the books or
 records; or
 `(ii) affirmative action to restore such books or records to a complete and
 accurate state, until the completion of the proceedings under subsection
 (b)(1).
 `(B) EFFECTIVE PERIOD- Any temporary order issued under subparagraph (A)--
 `(i) shall become effective upon service; and
 `(ii) unless set aside, limited, or suspended by a court in proceedings under
 paragraph (2), shall remain in effect and enforceable until the earlier of--
 `(I) the completion of the proceeding initiated under subsection (b)(1)
 in connection with the notice of charges; or
 `(II) the date the appropriate Federal banking agency determines,
 by examination or otherwise, that the insured depository institution's
 books and records are accurate and reflect the financial condition of the
 depository institution.'.
 (b) CREDIT UNIONS INSURED BY THE NCUA-
 (1) CEASE AND DESIST AUTHORITY- Section 206(e) of the Federal Credit Union
 Act (12 U.S.C. 1786(e)) is amended by adding at the end thereof the following
 new paragraphs:
 `(3) AFFIRMATIVE ACTION TO CORRECT CONDITIONS RESULTING FROM VIOLATIONS
 OR PRACTICES- The authority to issue an order under this subsection
 and subsection (f) which requires an insured credit union or any
 institution-affiliated party to take affirmative action to correct any
 conditions resulting from any violation or practice with respect to which
 such order is issued includes the authority to require such insured credit
 union or such party to--
 `(A) make restitution or provide reimbursement, indemnification, or guarantee
 against loss if--
 `(i) such credit union or such party was unjustly enriched in connection
 with such violation or practice; or
 `(ii) the violation or practice involved a reckless disregard for the law
 or any applicable regulations or prior order of the Board;
 `(B) restrict the growth of the institution;
 `(C) rescind agreements or contracts;
 `(D) dispose of any loan or asset involved; and
 `(E) employ qualified officers or employees (who may be subject to approval
 by the Board at the direction of such Board); and
 `(F) take such other action as the Board determines to be appropriate.
 `(4) AUTHORITY TO LIMIT ACTIVITIES- The authority to issue an order
 under this subsection or subsection (f) includes the authority to place
 limitations on the activities or functions of an insured credit union or
 any institution-affiliated party.'.
 (2) TEMPORARY CEASE AND DESIST AUTHORITY- Section 206(f) of the Federal
 Credit Union Act (12 U.S.C. 1786(f)) is amended--
 (A) by redesignating paragraph (3) as paragraph (4);
 (B) in paragraph (1)--
 (i) by striking out `substantial' and inserting in lieu thereof `significant';
 (ii) by striking out `seriously' each place such term appears; and
 (iii) by inserting after the 1st sentence the following new sentence: `Such
 order may include any requirement authorized under subsection (e)(3)(B).'; and
 (C) by inserting after paragraph (2) the following new paragraph:
 `(3) INCOMPLETE OR INACCURATE RECORDS-
 `(A) TEMPORARY ORDER- If a notice of charges served under subsection (e)(1)
 specifies, on the basis of particular facts and circumstances, that an insured
 credit union's books and records are so incomplete or inaccurate that the
 Board is unable, through the normal supervisory process, to determine the
 financial condition of that insured credit union or the details or purpose
 of any transaction or transactions that may have a material effect on the
 financial condition of that insured credit union, the Board may issue a
 temporary order requiring--
 `(i) the cessation of any activity or practice which gave rise, whether
 in whole or in part, to the incomplete or inaccurate state of the books or
 records; or
 `(ii) affirmative action to restore such books or records to a complete and
 accurate state, until the completion of the proceedings under subsection
 (e)(1).
 `(B) EFFECTIVE PERIOD- Any temporary order issued under subparagraph (A)--
 `(i) shall become effective upon service; and
 `(ii) unless set aside, limited, or suspended by a court in proceedings under
 paragraph (2), shall remain in effect and enforceable until the earlier of--
 `(I) the completion of the proceeding initiated under subsection (e)(1)
 in connection with the notice of charges; or
 `(II) the date the Board determines, by examination or otherwise, that
 the insured credit union's books and records are accurate and reflect the
 financial condition of the credit union.'.
SEC. 903. MERGER OF REMOVAL AND PROHIBITION AUTHORITY.
 (a) DEPOSITORY INSTITUTIONS INSURED BY THE FDIC-
 (1) IN GENERAL- Section 8(e)(1) of the Federal Deposit Insurance Act (12
 U.S.C. 1818(e)(1)) is amended to read as follows:
 `(e) REMOVAL AND PROHIBITION AUTHORITY-
 `(1) AUTHORITY TO ISSUE ORDER- Whenever the appropriate Federal banking
 agency determines that--
 `(A) any institution-affiliated party has, directly or indirectly--
 `(i) violated--
 `(I) any law or regulation;
 `(II) any cease-and-desist order which has become final;
 `(III) any condition imposed in writing by the appropriate Federal banking
 agency in connection with the grant of any application or other request by
 such depository institution; or
 `(IV) any written agreement between such depository institution and such
 agency;
 `(ii) engaged or participated in any unsafe or unsound practice in connection
 with any insured depository institution or business institution; or
 `(iii) committed or engaged in any act, omission, or practice which
 constitutes a breach of such party's fiduciary duty;
 `(B) by reason of the violation, practice, or breach described in any clause
 of subparagraph (A)--
 `(i) such insured depository institution or business institution has suffered
 or will probably suffer financial loss or other damage;
 `(ii) the interests of the insured depository institution's depositors have
 been or could be prejudiced; or
 `(iii) such party has received financial gain or other benefit by reason
 of such violation, practice, or breach; and
 `(C) such violation, practice, or breach--
 `(i) involves personal dishonesty on the part of such party; or
 `(ii) demonstrates willful or continuing disregard by such party for the
 safety or soundness of such insured depository institution or business
 institution,
the agency may serve upon such party a written notice of the agency's intention
to remove such party from office or to prohibit any further participation
by such party, in any manner, in the conduct of the affairs of any insured
depository institution.'.
 (2) TEMPORARY SUSPENSION OR PROHIBITION- Section 8(e) of the Federal Deposit
 Insurance Act (12 U.S.C. 1818(e)) is amended by striking out paragraphs
 (2) and (4), by redesignating paragraphs (3), (5), and (6) as paragraphs
 (2), (4), and (5), respectively, and by inserting after paragraph (2)
 (as so redesignated) the following new paragraph:
 `(3) SUSPENSION ORDER-
 `(A) SUSPENSION OR PROHIBITION AUTHORIZED- If the appropriate Federal
 banking agency serves written notice under paragraph (1) or (2) to any
 institution-affiliated party of such agency's intention to issue an order
 under such paragraph, the appropriate Federal banking agency may suspend
 such party from office or prohibit such party from further participation
 in any manner in the conduct of the affairs of the depository institution,
 if the agency--
 `(i) determines that such action is necessary for the protection of the
 depository institution or the interests of the depository institution's
 depositors; and
 `(ii) serves such party with written notice of the suspension order.
 `(B) EFFECTIVE PERIOD- Any suspension order issued under subparagraph (A)--
 `(i) shall become effective upon service; and
 `(ii) unless a court issues a stay of such order under subsection (f),
 shall remain in effect and enforceable until--
 `(I) the date the appropriate Federal banking agency dismisses the charges
 contained in the notice served under paragraph (1) or (2) with respect to
 such party; or
 `(II) the effective date of an order issued by the agency to such party
 under paragraph (1) or (2).
 `(C) COPY OF ORDER- If an appropriate Federal banking agency issues a
 suspension order under subparagraph (A) to any institution-affiliated party,
 the agency shall serve a copy of such order on any insured depository
 institution with which such party is associated at the time such order
 is issued.'.
 (3) PROHIBITION OF CERTAIN SPECIFIC ACTIVITIES- Section 8(e) of the Federal
 Deposit Insurance Act (12 U.S.C. 1818(e)) is amended by adding after paragraph
 (5) (as so redesignated by paragraph (2) of this subsection) the following
 new paragraph:
 `(6) PROHIBITION OF CERTAIN SPECIFIC ACTIVITIES- Any person subject to an
 order issued under this subsection shall not--
 `(A) participate in any manner in the conduct of the affairs of any
 institution or agency specified in paragraph (7)(A);
 `(B) solicit, procure, transfer, attempt to transfer, vote, or attempt to
 vote any proxy, consent, or authorization with respect to any voting rights
 in any institution described in subparagraph (A);
 `(C) violate any voting agreement previously approved by the appropriate
 Federal banking agency; or
 `(D) vote for a director, or serve or act as an institution-affiliated
 party.'.
 (4) CONFORMING AMENDMENTS-
 (A) Section 8(f) of the Federal Deposit Insurance Act (12 U.S.C. 1818(f))
 is amended--
 (i) by striking out `(e)(4)' and inserting in lieu thereof `(e)(3)'; and
 (ii) by striking out `(e)(1), (e)(2), or (e)(3)' and inserting in lieu
 thereof `(e)(1) or (e)(2)'.
 (B) Section 8(g)(1) of the Federal Deposit Insurance Act (12
 U.S.C. 1818(g)(1)) is amended by striking out `(1), (2), (3), or (4)'
 and inserting in lieu thereof `(1), (2), or (3)'.
 (b) CREDIT UNIONS INSURED BY THE NCUA-
 (1) IN GENERAL- Section 206(g)(1) of the Federal Credit Union Act (12
 U.S.C. 1786(g)(1)) is amended to read as follows:
 `(g) REMOVAL AND PROHIBITION AUTHORITY-
 `(1) AUTHORITY TO ISSUE ORDER- Whenever the Board determines that--
 `(A) any institution-affiliated party has, directly or indirectly--
 `(i) violated--
 `(I) any law or regulation;
 `(II) any cease-and-desist order which has become final;
 `(III) any condition imposed in writing by the Board in connection with
 the grant of any application or other request by such credit union; or
 `(IV) any written agreement between such credit union and the Board;
 `(ii) engaged or participated in any unsafe or unsound practice in connection
 with any insured credit union or business institution; or
 `(iii) committed or engaged in any act, omission, or practice which
 constitutes a breach of such party's fiduciary duty;
 `(B) by reason of the violation, practice, or breach described in any clause
 of subparagraph (A)--
 `(i) such insured credit union or business institution has suffered or will
 probably suffer financial loss or other damage;
 `(ii) the interests of the insured credit union's members have been or
 could be prejudiced; or
 `(iii) such party has received financial gain or other benefit by reason
 of such violation, practice or breach; and
 `(C) such violation, practice, or breach--
 `(i) involves personal dishonesty on the part of such party; or
 `(ii) demonstrates such party's unfitness to serve as a director or officer
 of, or to otherwise participate in the conduct of the affairs of, an insured
 credit union,
the Board may serve upon such party a written notice of the Board's intention
to remove such party from office or to prohibit any further participation,
by such party, in any manner in the conduct of the affairs of any insured
credit union.'.
 (2) TEMPORARY SUSPENSION OR PROHIBITION- Section 206(g) of the Federal
 Credit Union Act (12 U.S.C. 1786(g)) is amended by striking out paragraphs
 (2) and (4), by redesignating paragraphs (3) and (5) as paragraphs (2) and
 (4), respectively, and by inserting after paragraph (2) (as so redesignated)
 the following new paragraph:
 `(3) SUSPENSION ORDER-
 `(A) SUSPENSION OR PROHIBITION AUTHORIZED- If the Board serves written notice
 under paragraph (1) or (2) to any institution-affiliated party of the Board's
 intention to issue an order under such paragraph, the Board may suspend
 such party from office or prohibit such party from further participation
 in any manner in the conduct of the affairs of the institution, if the Board--
 `(i) determines that such action is necessary for the protection of the
 credit union or the interests of the credit union's members; and
 `(ii) serves such person with written notice of the suspension order.
 `(B) EFFECTIVE PERIOD- Any suspension order issued under subparagraph (A)--
 `(i) shall become effective upon service; and
 `(ii) unless a court issues a stay of such order under paragraph (6),
 shall remain in effect and enforceable until--
 `(I) the date the Board dismisses the charges contained in the notice served
 under paragraph (1) or (2) with respect to such party; or
 `(II) the effective date of an order issued by the Board to such person
 under paragraph (1) or (2).
 `(C) COPY OF ORDER- If the Board issues a suspension order under subparagraph
 (A) to any institution-affiliated party, the Board shall serve a copy of
 such order on any insured credit union with which such party is associated
 at the time such order is issued.'.
 (3) PROHIBITION OF CERTAIN SPECIFIC ACTIVITIES REQUIRED- Section 206(g)
 of the Federal Credit Union Act (12 U.S.C. 1786(g)) is amended by adding
 after paragraph (4) (as so redesignated by paragraph (2) of this subsection)
 the following new paragraph:
 `(5) PROHIBITION OF CERTAIN SPECIFIC ACTIVITIES- Any person subject to an
 order issued under this subsection shall not--
 `(A) participate in any manner in the conduct of the affairs of any
 institution or agency specified in paragraph (7)(A);
 `(B) solicit, procure, transfer, attempt to transfer, vote, or attempt to
 vote any proxy, consent, or authorization with respect to any voting rights
 in any institution described in subparagraph (A);
 `(C) violate any voting agreement previously approved by the appropriate
 Federal banking agency; or
 `(D) vote for a director, or serve or act as an institution-affiliated
 party.'.
 (4) CONFORMING AMENDMENTS- Section 206(g)(6) of the Federal Credit Union Act
 (12 U.S.C. 1786(g)(6)) is amended--
 (A) by striking out `paragraph (4)' and inserting in lieu thereof `paragraph
 (3)'; and
 (B) by striking out `(1), (2), or (3)' and inserting in lieu thereof `(1)
 or (2)'.
 (e) EFFECTIVE DATE- The amendments made by this section shall apply with
 respect to violations committed and activities engaged in after the date
 of the enactment of this Act.
SEC. 904. INDUSTRYWIDE APPLICATION OF REMOVAL, SUSPENSION, AND PROHIBITION
ORDERS.
 (a) DEPOSITORY INSTITUTIONS INSURED BY THE FDIC- Section 8(e) of the Federal
 Deposit Insurance Act (12 U.S.C. 1818(e)) is amended by inserting after the
 paragraph added by section 903(a)(3) of this Act the following new paragraph:
 `(7) INDUSTRYWIDE PROHIBITION-
 `(A) IN GENERAL- Except as provided in subparagraph (B), any person who,
 pursuant to an order issued under this subsection or subsection (g), has
 been removed or suspended from office in an insured depository institution
 or prohibited from participating in the conduct of the affairs of an insured
 depository institution may not, while such order is in effect, continue or
 commence to hold any office in, or participate in any manner in the conduct
 of the affairs of--
 `(i) any insured depository institution;
 `(ii) any institution treated as an insured bank under subsection (b)(3)
 or (b)(4), or as a savings association under subsection (b)(8);
 `(iii) any insured credit union under the Federal Credit Union Act;
 `(iv) any institution chartered under the Farm Credit Act of 1971;
 `(v) any appropriate Federal depository institution regulatory agency;
 `(vi) the Federal Housing Finance Board and any Federal home loan bank; and
 `(vii) the Resolution Trust Corporation.
 `(B) EXCEPTION IF AGENCY PROVIDES WRITTEN CONSENT- If, on or after the date an
 order is issued under this subsection which removes or suspends from office
 any institution-affiliated party or prohibits such party from participating
 in the conduct of the affairs of an insured depository institution, such
 party receives the written consent of--
 `(i) the agency that issued such order; and
 `(ii) the appropriate Federal financial institutions regulatory agency of
 the institution described in any clause of subparagraph (A) with respect
 to which such party proposes to become an institution-affiliated party,
subparagraph (A) shall, to the extent of such consent, cease to apply to such
party with respect to the institution described in each written consent. Any
agency that grants such a written consent shall report such action to the
Corporation and publicly disclose such consent.
 `(C) VIOLATION OF PARAGRAPH TREATED AS VIOLATION OF ORDER- Any violation
 of subparagraph (A) by any person who is subject to an order described in
 such subparagraph shall be treated as a violation of the order.
 `(D) APPROPRIATE FEDERAL FINANCIAL INSTITUTIONS REGULATORY AGENCY DEFINED-
 For purposes of this paragraph and subsection (j), the term `appropriate
 Federal financial institutions regulatory agency' means--
 `(i) the appropriate Federal banking agency, in the case of an insured
 depository institution;
 `(ii) the Farm Credit Administration, in the case of an institution chartered
 under the Farm Credit Act of 1971;
 `(iii) the National Credit Union Administration Board, in the case of an
 insured credit union (as defined in section 101(7) of the Federal Credit
 Union Act);
 `(iv) the Secretary of the Treasury, in the case of the Federal Housing
 Finance Board and any Federal home loan bank; and
 `(v) the Oversight Board, in the case of the Resolution Trust Corporation.
 `(E) CONSULTATION BETWEEN AGENCIES- The agencies referred to in clauses (i)
 and (ii) of subparagraph (B) shall consult with each other before providing
 any written consent described in subparagraph (B).
 `(F) APPLICABILITY- This paragraph shall only apply to a person who is an
 individual, unless the appropriate Federal banking agency specifically finds
 that it should apply to a corporation, firm, or other business enterprise.'.
 (b) CREDIT UNIONS INSURED BY THE NCUA- Section 206(g)(7) of the Federal
 Credit Union Act (12 U.S.C. 1786(g)(7)) is amended to read as follows:
 `(7) INDUSTRYWIDE PROHIBITION-
 `(A) IN GENERAL- Except as provided in subparagraph (B), any person who,
 pursuant to an order issued under this subsection or subsection (i), has been
 removed or suspended from office in an insured credit union or prohibited
 from participating in the conduct of the affairs of an insured credit union
 may not, while such order is in effect, continue or commence to hold any
 office in, or participate in any manner in the conduct of the affairs of--
 `(i) any insured depository institution;
 `(ii) any institution treated as an insured bank under paragraph (3) or
 (4) of section 8(b) of the Federal Deposit Insurance Act, or as a savings
 association under section 8(b)(8) of such Act;
 `(iii) any insured credit union;
 `(iv) any institution chartered under the Farm Credit Act of 1971;
 `(v) any appropriate Federal depository institution regulatory agency;
 `(vi) the Federal Housing Finance Board and any Federal home loan bank; and
 `(vii) the Resolution Trust Corporation.
 `(B) EXCEPTION IF AGENCY PROVIDES WRITTEN CONSENT- If, on or after the
 date an order is issued under this subsection which removes or suspends
 from office any institution-affiliated party or prohibits such party from
 participating in the conduct of the affairs of an insured credit union,
 such party receives the written consent of--
 `(i) the Board; and
 `(ii) the appropriate Federal financial institutions regulatory agency of
 the institution described in any clause of subparagraph (A) with respect
 to which such party proposes to become an institution-affiliated party,
subparagraph (A) shall, to the extent of such consent, cease to apply to such
party with respect to the institution described in each written consent. If
any person receives such a written consent from the Board, the Board shall
publicly disclose such consent. If the agency referred to in clause (ii)
grants such a written consent, such agency shall report such action to the
Board and publicly disclose such consent.
 `(C) VIOLATION OF PARAGRAPH TREATED AS VIOLATION OF ORDER- Any violation
 of subparagraph (A) by any person who is subject to an order described in
 such subparagraph shall be treated as a violation of the order.
 `(D) APPROPRIATE FEDERAL FINANCIAL INSTITUTIONS REGULATORY AGENCY DEFINED-
 For purposes of this paragraph and subsection (1), the term `appropriate
 Federal financial institutions regulatory agency' means--
 `(i) the appropriate Federal banking agency, as provided in section 3(q)
 of the Federal Deposit Insurance Act;
 `(ii) the Farm Credit Administration, in the case of an institution chartered
 under the Farm Credit Act of 1971;
 `(iii) the National Credit Union Administration Board, in the case of an
 insured credit union (as defined in section 101(7) of the Federal Credit
 Union Act);
 `(iv) the Secretary of the Treasury, in the case of the Federal Housing
 Finance Board and any Federal home loan bank; and
 `(v) the Oversight Board, in the case of the Resolution Trust Corporation.
 `(E) CONSULTATION BETWEEN AGENCIES- The agencies referred to in clauses (i)
 and (ii) of subparagraph (B) shall consult with each other before providing
 any written consent described in subparagraph (B).
 `(F) APPLICABILITY- This paragraph shall only apply to a person who is an
 individual, unless the Board specifically finds that it should apply to a
 corporation, firm, or other business enterprise.'.
SEC. 905. ENFORCEMENT PROCEEDINGS ALLOWED AFTER SEPARATION FROM SERVICE.
 (a) DEPOSITORY INSTITUTIONS INSURED BY THE FDIC- Section 8(i) of the Federal
 Deposit Insurance Act (12 U.S.C. 1818(i)) is amended by adding at the end
 thereof the following new paragraph:
 `(3) NOTICE UNDER THIS SECTION AFTER SEPARATION FROM SERVICE- The
 resignation, termination of employment or participation, or separation of an
 institution-affiliated party (including a separation caused by the closing
 of an insured depository institution) 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 depository institution (whether such date
 occurs before, on, or after the date of the enactment of this paragraph).'.
 (b) CREDIT UNIONS INSURED BY THE NCUA- Section 206(k) of the Federal Credit
 Union Act (12 U.S.C. 1786(k)) is amended by adding at the end thereof the
 following new paragraph:
 `(3) NOTICE UNDER THIS SECTION AFTER SEPARATION FROM SERVICE- The
 resignation, termination of employment or participation, or separation
 of a institution-affiliated party (including a separation caused by the
 closing of an insured credit union) shall not affect the jurisdiction and
 authority of the Board 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 credit union (whether such date occurs before, on,
 or after the date of the enactment of this paragraph).'.
 (c) CHANGE IN CONTROL OF DEPOSITORY INSTITUTION- Section 7(j)(15) of the
 Federal Deposit Insurance Act (12 U.S.C. 1817(j)(15)) is amended by adding
 at the end thereof the following new sentence: `The resignation, termination
 of employment or participation, divestiture of control, or separation of
 or by an institution-affiliated party (including a separation caused by the
 closing of a depository institution) shall not affect the jurisdiction and
 authority of the appropriate Federal banking agency to issue any notice
 and proceed under this subsection 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 depository institution
 (whether such date occurs before, on, or after the date of the enactment
 of this sentence).'.
 (d) NONMEMBER INSURED BANKS AND SAVINGS ASSOCIATIONS- Section 18(j) of the
 Federal Deposit Insurance Act (12 U.S.C. 1828(j)) is amended by adding at
 the end the following new paragraph:
 `(6) NOTICE UNDER THIS SECTION AFTER SEPARATION FROM SERVICE- The
 resignation, termination of employment or participation, or separation of an
 institution-affiliated party (including a separation caused by the closing of
 a nonmember bank or a savings association) shall not affect the jurisdiction
 and authority of the Corporation or the Director of the Office of Thrift
 Supervision, as appropriate, 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 nonmember bank or such savings association
 (whether such date occurs before, on, or after the date of the enactment
 of this paragraph).'.
 (e) NATIONAL BANKS- Section 5239 of the Revised Statutes (12 U.S.C. 93)
 is amended by adding at the end thereof the following new subsection:
 `(c) 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 an association
 (including a separation caused by the closing of such an association) shall
 not affect the jurisdiction and authority of the Comptroller of the Currency
 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 association
 (whether such date occurs before, on, or after the date of the enactment
 of this subsection).'.
 (f) MEMBER BANKS- Section 29 of the Federal Reserve Act (12 U.S.C. 504(a)),
 as added by section 907(g) of this Act, is amended by adding at the end
 the following new subsection:
 `(m) 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 a member 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 subsection).'.
 (g) MEMBER BANKS- Section 19 of the Federal Reserve Act (12 U.S.C. 505)
 is amended by adding at the end thereof the following new subsection:
 `(m) 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 a member bank (including
 a separation caused by the closing of such a bank) shall not affect the
 jurisdiction and authority of the Board 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 subsection).'.
 (h) BANKS- Section 106(b)(2) of the Bank Holding Company Act Amendments
 of 1970 (12 U.S.C. 1972(2)) is amended by adding at the end the following
 new subparagraph:
 `(I) 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).'.
 (i) BANK HOLDING COMPANIES- Section 8 of the Bank Holding Company Act of 1956
 (12 U.S.C. 1847) is amended by adding at the end the following new subsection:
 `(c) 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 a bank holding company
 (including a separation caused by the deregistration of such a company)
 shall not affect the jurisdiction and authority of the Board 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 holding company
 (whether such date occurs before, on, or after the date of the enactment
 of this subsection).'.
 (j) SAVINGS AND LOAN HOLDING COMPANIES- Section 10(i) of the Home Owners'
 Loan Act (as amended by section 301 of this Act) is amended by adding at
 the end thereof the following new paragraph:
 `(5) 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 a savings and loan
 holding company or subsidiary thereof (including a separation caused by the
 deregistration of such a company or such a subsidiary) shall not affect the
 jurisdiction and authority of the Director 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 holding company or its subsidiary
 (whether such date occurs before, on, or after the date of the enactment
 of this paragraph).'.
SEC. 906. EXPANSION OF REMOVAL POWERS FOR STATE CRIMINAL PROCEEDINGS.
 (a) DEPOSITORY INSTITUTIONS INSURED BY THE FDIC- Section 8(g)(1) of the
 Federal Deposit Insurance Act (12 U.S.C. 1818(g)(1)) is amended--
 (1) in the 1st sentence, by striking `authorized by a United States
 attorney'; and
 (2) in the 4th sentence, by striking `with respect to such crime' and
 inserting in lieu thereof `or an agreement to enter a pre-trial diversion
 or other similar program'.
 (b) CREDIT UNIONS INSURED BY THE NCUA- Section 206(i)(1) of the Federal
 Credit Union Act (12 U.S.C. 1786(i)) is amended--
 (1) in the 1st sentence, by striking `authorized by a United States
 Attorney'; and
 (2) in the 4th sentence, by striking `with respect to such crime' and
 inserting in lieu thereof `or an agreement to enter a pre-trial diversion
 or other similar program'.
SEC. 907. AMENDMENTS TO EXPAND AND INCREASE CIVIL MONEY PENALTIES.
 (a) GENERAL PROVISIONS FOR DEPOSITORY INSTITUTIONS INSURED BY THE FDIC-
 Section 8(i)(2) of the Federal Deposit Insurance Act (12 U.S.C. 1818(i)(2))
 is amended to read as follows:
 `(2) CIVIL MONEY PENALTY-
 `(A) FIRST TIER- Any insured depository institution which, and any
 institution-affiliated party who--
 `(i) violates any law or regulation;
 `(ii) violates any final order or temporary order issued pursuant to
 subsection (b), (c), (e), (g), or (s);
 `(iii) violates any condition imposed in writing by the appropriate Federal
 banking agency in connection with the grant of any application or other
 request by such depository institution; or
 `(iv) violates any written agreement between such depository institution
 and such agency,
shall forfeit and pay a civil penalty of not more than $5,000 for each day
during which such violation continues.
 `(B) SECOND TIER- Notwithstanding subparagraph (A), any insured depository
 institution which, and any institution-affiliated party who--
 `(i)(I) commits any violation described in any clause of subparagraph (A);
 `(II) recklessly engages in an unsafe or unsound practice in conducting
 the affairs of such insured depository institution; or
 `(III) breaches any fiduciary duty;
 `(ii) which violation, practice, or breach--
 `(I) is part of a pattern of misconduct;
 `(II) causes or is likely to cause more than a minimal loss to such depository
 institution; or
 `(III) results in pecuniary gain or other benefit to such party,
shall forfeit and pay a civil penalty of not more than $25,000 for each day
during which such violation, practice, or breach continues.
 `(C) THIRD TIER- Notwithstanding subparagraphs (A) and (B), any insured
 depository institution which, and any institution-affiliated party who--
 `(i) knowingly--
 `(I) commits any violation described in any clause of subparagraph (A);
 `(II) engages in any unsafe or unsound practice in conducting the affairs
 of such depository institution; or
 `(III) breaches any fiduciary duty; and
 `(ii) knowingly or recklessly causes a substantial loss to such depository
 institution or a substantial pecuniary gain or other benefit to such party
 by reason of such violation, practice, or breach,
shall forfeit and pay a civil penalty in an amount not to exceed the applicable
maximum amount determined under subparagraph (D) for each day during which
such violation, practice, or breach continues.
 `(D) MAXIMUM AMOUNTS OF PENALTIES FOR ANY VIOLATION DESCRIBED IN SUBPARAGRAPH
 (C)- The maximum daily amount of any civil penalty which may be assessed
 pursuant to subparagraph (C) for any violation, practice, or breach described
 in such subparagraph is--
 `(i) in the case of any person other than an insured depository institution,
 an amount to not exceed $1,000,000; and
 `(ii) in the case of any insured depository institution, an amount not to
 exceed the lesser of--
 `(I) $1,000,000; or
 `(II) 1 percent of the total assets of such institution.
 `(E) ASSESSMENT-
 `(i) WRITTEN NOTICE- Any penalty imposed under subparagraph (A), (B), or
 (C) may be assessed and collected by the appropriate Federal banking agency
 by written notice.
 `(ii) FINALITY OF ASSESSMENT- If, with respect to any assessment under
 clause (i), a hearing is not requested pursuant to subparagraph (H) within
 the period of time allowed under such subparagraph, the assessment shall
 constitute a final and unappealable order.
 `(F) AUTHORITY TO MODIFY OR REMIT PENALTY- Any appropriate Federal banking
 agency may compromise, modify, or remit any penalty which such agency may
 assess or had already assessed under subparagraph (A), (B), or (C).
 `(G) MITIGATING FACTORS- In determining the amount of any penalty imposed
 under subparagraph (A), (B), or (C), the appropriate agency shall take into
 account the appropriateness of the penalty with respect to--
 `(i) the size of financial resources and good faith of the insured depository
 institution or other person charged;
 `(ii) the gravity of the violation;
 `(iii) the history of previous violations; and
 `(iv) such other matters as justice may require.
 `(H) HEARING- The insured depository institution or other person against
 whom any penalty is assessed under this paragraph shall be afforded an
 agency hearing if such institution or person submits a request for such
 hearing within 20 days after the issuance of the notice of assessment.
 `(I) COLLECTION-
 `(i) REFERRAL- If any insured depository institution or other person fails
 to pay an assessment after any penalty assessed under this paragraph has
 become final, the agency that imposed the penalty shall recover the amount
 assessed by action in the appropriate United States district court.
 `(ii) APPROPRIATENESS OF PENALTY NOT REVIEWABLE- In any civil action under
 clause (i), the validity and appropriateness of the penalty shall not be
 subject to review.
 `(J) DISBURSEMENT- All penalties collected under authority of this paragraph
 shall be deposited into the Treasury.
 `(K) REGULATIONS- Each appropriate Federal banking agency shall prescribe
 regulations establishing such procedures as may be necessary to carry out
 this paragraph.'.
 (b) GENERAL PROVISIONS FOR CREDIT UNIONS INSURED BY THE NCUA- Section
 206(k)(2) of the Federal Credit Union Act (12 U.S.C. 1786(k)(2)) is amended
 to read as follows:
 `(2) CIVIL MONEY PENALTY-
 `(A) FIRST TIER- Any insured credit union which, and any
 institution-affiliated party who--
 `(i) violates any law or regulation;
 `(ii) violates any final order or temporary order issued pursuant to
 subsection (e), (f), (g), (i), or (q);
 `(iii) violates any condition imposed in writing by the Board in connection
 with the grant of any application or other request by such credit union; or
 `(iv) violates any written agreement between such credit union and such
 agency,
shall forfeit and pay a civil penalty of not more than $5,000 for each day
during which such violation continues.
 `(B) SECOND TIER- Notwithstanding subparagraph (A), any insured credit
 union which, and any institution-affiliated party who--
 `(i)(I) commits any violation described in any clause of subparagraph (A);
 `(II) recklessly engages in an unsafe or unsound practice in conducting
 the affairs of such credit union; or
 `(III) breaches any fiduciary duty;
 `(ii) which violation, practice, or breach--
 `(I) is part of a pattern of misconduct;
 `(II) causes or is likely to cause more than a minimal loss to such credit
 union; or
 `(III) results in pecuniary gain or other benefit to such party,
shall forfeit and pay a civil penalty of not more than $25,000 for each day
during which such violation, practice, or breach continues.
 `(C) THIRD TIER- Notwithstanding subparagraphs (A) and (B), any insured
 credit union which, and any institution-affiliated party who--
 `(i) knowingly--
 `(I) commits any violation described in any clause of subparagraph (A);
 `(II) engages in any unsafe or unsound practice in conducting the affairs
 of such credit union; or
 `(III) breaches any fiduciary duty; and
 `(ii) knowingly or recklessly causes a substantial loss to such credit
 union or a substantial pecuniary gain or other benefit to such party by
 reason of such violation, practice, or breach,
shall forfeit and pay a civil penalty in an amount not to exceed the applicable
maximum amount determined under subparagraph (D) for each day during which
such violation, practice, or breach continues.
 `(D) MAXIMUM AMOUNTS OF PENALTIES FOR ANY VIOLATION DESCRIBED IN SUBPARAGRAPH
 (C)- The maximum daily amount of any civil penalty which may be assessed
 pursuant to subparagraph (C) for any violation, practice, or breach described
 in such subparagraph is--
 `(i) in the case of any person other than an insured credit union, an amount
 to not exceed $1,000,000; and
 `(ii) in the case of any insured credit union, an amount not to exceed the
 lesser of--
 `(I) $1,000,000; or
 `(II) 1 percent of the total assets of such credit union.
 `(E) ASSESSMENT-
 `(i) WRITTEN NOTICE- Any penalty imposed under subparagraph (A), (B), or
 (C) may be assessed and collected by the Board by written notice.
 `(ii) FINALITY OF ASSESSMENT- If, with respect to any assessment under
 clause (i), a hearing is not requested pursuant to subparagraph (H) within
 the period of time allowed under such subparagraph, the assessment shall
 constitute a final and unappealable order.
 `(F) AUTHORITY TO MODIFY OR REMIT PENALTY- The Board may compromise, modify,
 or remit any penalty which such agency may assess or had already assessed
 under subparagraph (A), (B), or (C).
 `(G) MITIGATING FACTORS- In determining the amount of any penalty imposed
 under subparagraph (A), (B), or (C), the Board shall take into account the
 appropriateness of the penalty with respect to--
 `(i) the size of financial resources and good faith of the insured credit
 union or the person charged;
 `(ii) the gravity of the violation;
 `(iii) the history of previous violations; and
 `(iv) such other matters as justice may require.
 `(H) HEARING- The insured credit union or other person against whom any
 penalty is assessed under this paragraph shall be afforded an agency hearing
 if such institution or person submits a request for such hearing within 20
 days after the issuance of the notice of assessment.
 `(I) COLLECTION-
 `(i) REFERRAL- If any insured credit union or other person fails to pay an
 assessment after any penalty assessed under this paragraph has become final,
 the Board shall recover the amount assessed by action in the appropriate
 United States district court.
 `(ii) APPROPRIATENESS OF PENALTY NOT REVIEWABLE- In any civil action under
 clause (i), the validity and appropriateness of the penalty shall not be
 subject to review.
 `(J) DISBURSEMENT- All penalties collected under authority of this paragraph
 shall be deposited into the Treasury.
 `(K) VIOLATE DEFINED- For purposes of this section, the term `violate'
 includes any action (alone or with another or others) for or toward causing,
 bringing about, participating in, counseling, or aiding or abetting a
 violation.
 `(L) REGULATIONS- The Board shall prescribe regulations establishing such
 procedures as may be necessary to carry out this paragraph.'.
 (c) NONMEMBER INSURED BANKS AND SAVINGS ASSOCIATIONS- Paragraphs (4) and (5)
 of section 18(j) of the Federal Deposit Insurance Act (12 U.S.C. 1828(j))
 are amended to read as follows:
 `(4) CIVIL MONEY PENALTY-
 `(A) FIRST TIER- Any nonmember insured bank or savings association which,
 and any institution-affiliated party who, violates any provision of section
 22(h), 23A, or 23B of the Federal Reserve Act or any lawful regulation
 issued pursuant thereto, and any nonmember insured bank which, and any
 institution-affiliated party who, violates any provision of section 20 of
 the Banking Act of 1933, shall forfeit and pay a civil penalty of not more
 than $5,000 for each day during which such violation continues.
 `(B) SECOND TIER- Notwithstanding subparagraph (A), any nonmember insured
 bank or savings association which, and any institution-affiliated party who--
 `(i)(I) commits any violation described in any clause of subparagraph (A);
 `(II) recklessly engages in an unsafe or unsound practice in conducting
 the affairs of such bank or association, as the case may be; or
 `(III) breaches any fiduciary duty;
 `(ii) which violation, practice, or breach--
 `(I) is part of a pattern of misconduct;
 `(II) results in more than a minimal loss to such bank or association,
 as the case may be; or
 `(III) causes or is likely to cause pecuniary gain or other benefit to
 such party,
shall forfeit and pay a civil penalty of not more than $25,000 for each day
during which such violation, practice, or breach continues.
 `(C) THIRD TIER- Notwithstanding subparagraphs (A) and (B), any nonmember
 insured bank or savings association which, and any institution-affiliated
 party who--
 `(i) knowingly--
 `(I) commits any violation described in any clause of subparagraph (A);
 `(II) engages in any unsafe or unsound practice in conducting the affairs
 of such bank or association; or
 `(III) breaches any fiduciary duty; and
 `(ii) knowingly or recklessly causes a substantial loss to such bank or
 association or a substantial pecuniary gain or other benefit to such party
 by reason of such violation, practice, or breach,
shall forfeit and pay a civil penalty in an amount not to exceed the applicable
maximum amount determined under subparagraph (D) for each day during which
such violation, practice, or breach continues.
 `(D) MAXIMUM AMOUNTS OF PENALTIES FOR ANY VIOLATION DESCRIBED IN SUBPARAGRAPH
 (C)- The maximum daily amount of any civil penalty which may be assessed
 pursuant to subparagraph (C) for any violation, practice, or breach described
 in such subparagraph is--
 `(i) in the case of any person other than a nonmember insured bank or
 savings association, an amount to not exceed $1,000,000; and
 `(ii) in the case of any nonmember insured bank or savings association,
 an amount not to exceed the lesser of--
 `(I) $1,000,000; or
 `(II) 1 percent of the total assets of such bank or association.
 `(E) ASSESSMENT; ETC- Any penalty imposed under subparagraph (A), (B),
 or (C) shall be assessed and collected by the appropriate Federal banking
 agency in the manner provided in subparagraphs (E), (F), (G), and (I) of
 section 8(i)(2) for penalties imposed (under such section) and any such
 assessment shall be subject to the provisions of such section.
 `(F) HEARING- The nonmember insured bank, savings association, or other
 person against whom any penalty is assessed under this paragraph shall
 be afforded an agency hearing if such nonmember insured bank, savings
 association, or other person submits a request for such hearing within 20
 days after the issuance of the notice of assessment. Section 8(h) shall
 apply to any proceeding under this paragraph.
 `(G) DISBURSEMENT- All penalties collected under authority of this paragraph
 shall be deposited into the Treasury.
 `(5) REGULATIONS- The appropriate Federal banking agency shall prescribe
 regulations establishing such procedures as may be necessary to carry out
 paragraph (4).'.
 (d) CHANGE IN CONTROL OF DEPOSITORY INSTITUTION- Section 7(j)(16) of the
 Federal Deposit Insurance Act (12 U.S.C. 1817(j)(16)) is amended to read
 as follows:
 `(16) CIVIL MONEY PENALTY-
 `(A) FIRST TIER- Any person who violates any provision of this subsection,
 or any regulation or order issued by the appropriate Federal banking agency
 under this subsection, shall forfeit and pay a civil penalty of not more
 than $5,000 for each day during which such violation continues.
 `(B) SECOND TIER- Notwithstanding subparagraph (A), any person who--
 `(i)(I) commits any violation described in any clause of subparagraph (A);
 `(II) recklessly engages in an unsafe or unsound practice in conducting
 the affairs of a depository institution; or
 `(III) breaches any fiduciary duty;
 `(ii) which violation, practice, or breach--
 `(I) is part of a pattern of misconduct;
 `(II) causes or is likely to cause more than a minimal loss to such
 institution; or
 `(III) results in pecuniary gain or other benefit to such person,
shall forfeit and pay a civil penalty of not more than $25,000 for each day
during which such violation, practice, or breach continues.
 `(C) THIRD TIER- Notwithstanding subparagraphs (A) and (B), any person who--
 `(i) knowingly--
 `(I) commits any violation described in any clause of subparagraph (A);
 `(II) engages in any unsafe or unsound practice in conducting the affairs
 of a depository institution; or
 `(III) breaches any fiduciary duty; and
 `(ii) knowingly or recklessly causes a substantial loss to such institution
 or a substantial pecuniary gain or other benefit to such person by reason
 of such violation, practice, or breach,
shall forfeit and pay a civil penalty in an amount not to exceed the applicable
maximum amount determined under subparagraph (D) for each day during which
such violation, practice, or breach continues.
 `(D) MAXIMUM AMOUNTS OF PENALTIES FOR ANY VIOLATION DESCRIBED IN SUBPARAGRAPH
 (c)- The maximum daily amount of any civil penalty which may be assessed
 pursuant to subparagraph (C) for any violation, practice, or breach described
 in such subparagraph is--
 `(i) in the case of any person other than a depository institution, an
 amount to not exceed $1,000,000; and
 `(ii) in the case of a depository institution, an amount not to exceed the
 lesser of--
 `(I) $1,000,000; or
 `(II) 1 percent of the total assets of such institution.
 `(E) ASSESSMENT; ETC- Any penalty imposed under subparagraph (A), (B),
 or (C) shall be assessed and collected by the appropriate Federal banking
 agency in the manner provided in subparagraphs (E), (F), (G), and (I) of
 section 8(i)(2) for penalties imposed (under such section) and any such
 assessment shall be subject to the provisions of such section.
 `(F) HEARING- The depository institution or other person against whom any
 penalty is assessed under this paragraph shall be afforded an agency hearing
 if such institution or other person submits a request for such hearing
 within 20 days after the issuance of the notice of assessment. Section 8(h)
 shall apply to any proceeding under this paragraph.
 `(G) DISBURSEMENT- All penalties collected under authority of this paragraph
 shall be deposited into the Treasury.'.
 (e) NATIONAL BANKS- Section 5239(b) of the Revised Statutes (12 U.S.C. 93(b))
 is amended to read as follows:
 `(b) CIVIL MONEY PENALTY-
 `(1) FIRST TIER- Any national banking association which, and any
 institution-affiliated party (within the meaning of section 3(u) of the
 Federal Deposit Insurance Act) with respect to such association who, violates
 any provision of this title or any of the provisions of the first section
 of the Act of September 28, 1962, (76 Stat. 668; 12 U.S.C. 92a), or any
 regulation issued pursuant thereto, shall forfeit and pay a civil penalty
 of not more than $5,000 for each day during which such violation continues.
 `(2) SECOND TIER- Notwithstanding paragraph (1), any national banking
 association which, and any institution-affiliated party (within the meaning
 of section 3(u) of the Federal Deposit Insurance Act) with respect to such
 association who, commits any violation described in paragraph (1) which--
 `(A)(i) commits any violation described in any paragraph (1);
 `(ii) recklessly engages in an unsafe or unsound practice in conducting
 the affairs of such association; or
 `(iii) breaches any fiduciary duty;
 `(B) which violation, practice, or breach--
 `(i) is part of a pattern of misconduct;
 `(ii) causes or is likely to cause more than a minimal loss to such
 association; or
 `(iii) results in pecuniary gain or other benefit to such party,
shall forfeit and pay a civil penalty of not more than $25,000 for each day
during which such violation, practice, or breach continues.
 `(3) THIRD TIER- Notwithstanding paragraphs (1) and (2), any national banking
 association which, and any institution-affiliated party (within the meaning
 of section 3(u) of the Federal Deposit Insurance Act) with respect to such
 association who--
 `(A) knowingly--
 `(i) commits any violation described in paragraph (1);
 `(ii) engages in any unsafe or unsound practice in conducting the affairs
 of such association; or
 `(iii) breaches any fiduciary duty; and
 `(B) knowingly or recklessly causes a substantial loss to such association
 or a substantial pecuniary gain or other benefit to such party by reason
 of such violation, practice, or breach,
shall forfeit and pay a civil penalty in an amount not to exceed the applicable
maximum amount determined under paragraph (4) for each day during which such
violation, practice, or breach continues.
 `(4) MAXIMUM AMOUNTS OF PENALTIES FOR ANY VIOLATION DESCRIBED IN PARAGRAPH
 (3)- The maximum daily amount of any civil penalty which may be assessed
 pursuant to paragraph (3) for any violation, practice, or breach described
 in such paragraph is--
 `(A) in the case of any person other than a national banking association,
 an amount to not exceed $1,000,000; and
 `(B) in the case of a national banking association, an amount not to exceed
 the lesser of--
 `(i) $1,000,000; or
 `(ii) 1 percent of the total assets of such association.
 `(5) ASSESSMENT; ETC- Any penalty imposed under paragraph (1), (2), or (3)
 shall be assessed and collected by the Comptroller of the Currency in the
 manner provided in subparagraphs (E), (F), (G), and (I) of section 8(i)(2) of
 the Federal Deposit Insurance Act for penalties imposed (under such section)
 and any such assessment shall be subject to the provisions of such section.
 `(6) HEARING- The association or other person against whom any penalty is
 assessed under this subsection shall be afforded an agency hearing if such
 association or person submits a request for such hearing within 20 days
 after the issuance of the notice of assessment. Section 8(h) of the Federal
 Deposit Insurance Act shall apply to any proceeding under this subsection.
 `(7) DISBURSEMENT- All penalties collected under authority of this subsection
 shall be deposited into the Treasury.
 `(8) VIOLATE DEFINED- For purposes of this section, the term `violate'
 includes any action (alone or with another or others) for or toward causing,
 bringing about, participating in, counseling, or aiding or abetting a
 violation.
 `(12) REGULATIONS- The Comptroller shall prescribe regulations establishing
 such procedures as may be necessary to carry out this subsection.'.
 (f) NATIONAL BANKS- The 2d paragraph of section 5240 of the Revised Statutes
 (12 U.S.C. 481) is amended by striking `$100' and inserting `$5,000'.
 (g) MEMBER BANKS- Section 29 of the Federal Reserve Act (12 U.S.C. 504)
 is amended to read as follows:
`SEC. 29. CIVIL MONEY PENALTY.
 `(a) FIRST TIER- Any member bank which, and any institution-affiliated party
 (within the meaning of section 3(u) of the Federal Deposit Insurance Act)
 with respect to such member bank who, violates any provision of section 22,
 23A, or 23B, or any regulation issued pursuant thereto, shall forfeit and
 pay a civil penalty of not more than $5,000 for each day during which such
 violation continues.
 `(b) SECOND TIER- Notwithstanding subsection (a), any member bank which,
 and any institution-affiliated party (within the meaning of section 3(u)
 of the Federal Deposit Insurance Act) with respect to such member bank who
 `(1)(A) commits any violation described in subsection (a);
 `(B) recklessly engages in an unsafe or unsound practice in conducting the
 affairs of such member bank; or
 `(C) breaches any fiduciary duty;
 `(2) which violation, practice, or breach--
 `(A) is part of a pattern of misconduct;
 `(B) causes or is likely to cause more than a minimal loss to such member
 bank; or
 `(C) results in pecuniary gain or other benefit to such party,
shall forfeit and pay a civil penalty of not more than $25,000 for each day
during which such violation, practice, or breach continues.
 `(c) THIRD TIER- Notwithstanding subsections (a) and (b), any member bank
 which, and any institution-affiliated party (within the meaning of section
 3(u) of the Federal Deposit Insurance Act) with respect to such member
 bank who--
 `(1) knowingly--
 `(A) commits any violation described in subsection (a);
 `(B) engages in any unsafe or unsound practice in conducting the affairs
 of such credit union; or
 `(C) breaches any fiduciary duty; and
 `(2) knowingly or recklessly causes a substantial loss to such credit union
 or a substantial pecuniary gain or other benefit to such party by reason
 of such violation, practice, or breach,
shall forfeit and pay a civil penalty in an amount not to exceed the applicable
maximum amount determined under subsection (d) for each day during which
such violation, practice, or breach continues.
 `(d) MAXIMUM AMOUNTS OF PENALTIES FOR ANY VIOLATION DESCRIBED IN SUBSECTION
 (c)- The maximum daily amount of any civil penalty which may be assessed
 pursuant to subsection (c) for any violation, practice, or breach described
 in such subsection is--
 `(1) in the case of any person other than a member bank, an amount to not
 exceed $1,000,000; and
 `(2) in the case of a member bank, an amount not to exceed the lesser of--
 `(A) $1,000,000; or
 `(B) 1 percent of the total assets of such member bank.
 `(e) ASSESSMENT; ETC- Any penalty imposed under subsection (a), (b), or
 (c) shall be assessed and collected by
 `(1) in the case of a national bank, by the Comptroller of the Currency; and
 `(2) in the case of a State member bank, by the Board,
in the manner provided in subparagraphs (E), (F), (G), and (I) of section
8(i)(2) of the Federal Deposit Insurance Act for penalties imposed (under
such section) and any such assessment shall be subject to the provisions of
such section.
 `(f) HEARING- The member bank or other person against whom any penalty is
 assessed under this section shall be afforded an agency hearing if such
 member bank or person submits a request for such hearing within 20 days
 after the issuance of the notice of assessment. Section 8(h) of the Federal
 Deposit Insurance Act shall apply to any proceeding under this section.
 `(g) DISBURSEMENT- All penalties collected under authority of this paragraph
 shall be deposited into the Treasury.
 `(h) VIOLATE DEFINED- For purposes of this section, the term `violate'
 includes any action (alone or with another or others) for or toward causing,
 bringing about, participating in, counseling, or aiding or abetting a
 violation.
 `(i) REGULATIONS- The Comptroller of the Currency and the Board shall
 prescribe regulations establishing such procedures as may be necessary to
 carry out this section.'.
 (h) MEMBER BANK- Section 19(l) of the Federal Reserve Act (12 U.S.C. 505(l))
 is amended to read as follows:
 `(l) CIVIL MONEY PENALTY-
 `(1) FIRST TIER- Any member bank which, and any institution-affiliated party
 (within the meaning of section 3(u) of the Federal Deposit Insurance Act) with
 respect to such member bank who, violates any provision of this section, or
 any regulation issued pursuant thereto, shall forfeit and pay a civil penalty
 of not more than $5,000 for each day during which such violation continues.
 `(2) SECOND TIER- Notwithstanding paragraph (1), any member bank which,
 and any institution-affiliated party (within the meaning of section 3(u)
 of the Federal Deposit Insurance Act) with respect to such member bank who--
 `(A)(i) commits any violation described in paragraph (1);
 `(ii) recklessly engages in an unsafe or unsound practice in conducting
 the affairs of such member bank; or
 `(iii) breaches any fiduciary duty;
 `(B) which violation, practice, or breach--
 `(i) is part of a pattern of misconduct;
 `(ii) causes or is likely to cause more than a minimal loss to such member
 bank; or
 `(iii) results in pecuniary gain or other benefit to such party,
shall forfeit and pay a civil penalty of not more than $25,000 for each day
during which such violation, practice, or breach continues.
 `(3) THIRD TIER- Notwithstanding paragraphs (1) and (2), any member bank
 which, and any institution-affiliated party (within the meaning of section
 3(u) of the Federal Deposit Insurance Act) with respect to such member
 bank who--
 `(A) knowingly--
 `(i) commits any violation described in paragraph (1);
 `(ii) engages in any unsafe or unsound practice in conducting the affairs
 of such member bank; or
 `(iii) breaches any fiduciary duty; and
 `(B) knowingly or recklessly causes a substantial loss to such member bank
 or a substantial pecuniary gain or other benefit to such party by reason
 of such violation, practice, or breach,
shall forfeit and pay a civil penalty in an amount not to exceed the applicable
maximum amount determined under paragraph (4) for each day during which such
violation, practice, or breach continues.
 `(4) MAXIMUM AMOUNTS OF PENALTIES FOR ANY VIOLATION DESCRIBED IN PARAGRAPH
 (3)- The maximum daily amount of any civil penalty which may be assessed
 pursuant to paragraph (3) for any violation, practice, or breach described
 in such paragraph is--
 `(A) in the case of any person other than a member bank, an amount not to
 exceed $1,000,000; and
 `(B) in the case of a member bank, an amount not to exceed the lesser of--
 `(i) $1,000,000; or
 `(ii) 1 percent of the total assets of such member bank.
 `(5) ASSESSMENT; ETC- Any penalty imposed under paragraph (1), (2), or
 (3) may be assessed and collected by the Board in the manner provided in
 subparagraphs (E), (F), (G), and (I) of section 8(i)(2) of the Federal
 Deposit Insurance Act for penalties imposed (under such section) and any
 such assessment shall be subject to the provisions of such section.
 `(6) HEARING- The member bank or other person against whom any penalty is
 assessed under this subsection shall be afforded an agency hearing if such
 member bank or person submits a request for such hearing within 20 days
 after the issuance of the notice of assessment. Section 8(h) of the Federal
 Deposit Insurance Act shall apply to any proceeding under this subsection.
 `(7) DISBURSEMENT- All penalties collected under authority of this subsection
 shall be deposited into the Treasury.
 `(8) VIOLATE DEFINED- For purposes of this section, the term `violate'
 includes any action (alone or with another or others) for or toward causing,
 bringing about, participating in, counseling, or aiding or abetting a
 violation.
 `(9) REGULATIONS- The Board shall prescribe regulations establishing such
 procedures as may be necessary to carry out this subsection.'.
 (i) BANKS- Section 106(b)(2)(F) of the Bank Holding Company Act Amendments
 of 1970 (12 U.S.C. 1972(2)(F)) is amended to read as follows:
 `(F) CIVIL MONEY PENALTY-
 `(i) FIRST TIER- Any bank which, and any institution-affiliated party
 (within the meaning of section 3(u) of the Federal Deposit Insurance Act)
 with respect to such bank who, violates any provision of this paragraph
 shall forfeit and pay a civil penalty of not more than $5,000 for each day
 during which such violation continues.
 `(ii) SECOND TIER- Notwithstanding clause (i), any bank which, and any
 institution-affiliated party (within the meaning of section 3(u) of the
 Federal Deposit Insurance Act) with respect to such bank who--
 `(I)(aa) commits any violation described in clause (i);
 `(bb) recklessly engages in an unsafe or unsound practice in conducting
 the affairs of such bank; or
 `(cc) breaches any fiduciary duty;
 `(II) which violation, practice, or breach--
 `(aa) is part of a pattern of misconduct;
 `(bb) causes or is likely to cause more than a minimal loss to such bank; or
 `(cc) results in pecuniary gain or other benefit to such party,
shall forfeit and pay a civil penalty of not more than $25,000 for each day
during which such violation, practice, or breach continues.
 `(iii) THIRD TIER- Notwithstanding clauses (i) and (ii), any bank which,
 and any institution-affiliated party (within the meaning of section 3(u)
 of the Federal Deposit Insurance Act) with respect to such bank who--
 `(I) knowingly--
 `(aa) commits any violation described in clause (i);
 `(bb) engages in any unsafe or unsound practice in conducting the affairs
 of such bank; or
 `(cc) breaches any fiduciary duty; and
 `(II) knowingly or recklessly causes a substantial loss to such bank or
 a substantial pecuniary gain or other benefit to such party by reason of
 such violation, practice, or breach,
shall forfeit and pay a civil penalty in an amount not to exceed the applicable
maximum amount determined under clause (iv) for each day during which such
violation, practice, or breach continues.
 `(iv) MAXIMUM AMOUNTS OF PENALTIES FOR ANY VIOLATION DESCRIBED IN CLAUSE
 (iii)- The maximum daily amount of any civil penalty which may be assessed
 pursuant to clause (iii) for any violation, practice, or breach described
 in such clause is--
 `(I) in the case of any person other than a bank, an amount to not exceed
 $1,000,000; and
 `(II) in the case of a bank, an amount not to exceed the lesser of--
 `(aa) $1,000,000; or
 `(bb) 1 percent of the total assets of such bank.
 `(v) ASSESSMENT; ETC- Any penalty imposed under clause (i), (ii), or (iii)
 may be assessed and collected--
 `(I) in the case of a national bank, by the Comptroller of the Currency;
 `(II) in the case of a State member bank, by the Board; and
 `(III) in the case of an insured nonmember State bank, by the Federal
 Deposit Insurance Corporation,
in the manner provided in subparagraphs (E), (F), (G), and (I) of section
8(i)(2) of the Federal Deposit Insurance Act for penalties imposed (under
such section) and any such assessment shall be subject to the provisions of
such section.
 `(vi) HEARING- The bank or other person against whom any penalty is assessed
 under this subparagraph shall be afforded an agency hearing if such bank or
 person submits a request for such hearing within 20 days after the issuance
 of the notice of assessment. Section 8(h) of the Federal Deposit Insurance
 Act shall apply to any proceeding under this subparagraph.
 `(vii) DISBURSEMENT- All penalties collected under authority of this
 subsection shall be deposited into the Treasury.
 `(viii) VIOLATE DEFINED- For purposes of this paragraph, the term `violate'
 includes any action (alone or with another or others) for or toward causing,
 bringing about, participating in, counseling, or aiding or abetting a
 violation.
 `(ix) REGULATIONS- The Comptroller of the Currency, the Board, and the Federal
 Deposit Insurance Corporation shall prescribe regulations establishing such
 procedures as may be necessary to carry out this subparagraph.'.
 (j) BANK HOLDING COMPANIES- Section 8 of the Bank Holding Company Act of 1956
 (12 U.S.C. 1847) is amended--
 (1) in subsection (a), by striking out the first 2 sentences and inserting
 in lieu thereof the following:
 `(a) CRIMINAL PENALTY-
 `(1) Whoever knowingly violates any provision of this Act or, being a company,
 violates any regulation or order issued by the Board under this Act, shall
 be imprisoned not more than 1 year, fined not more than $100,000 per day
 for each day during which the violation continues, or both.
 `(2) Whoever, with the intent to deceive, defraud, or profit significantly,
 knowingly violates any provision of this Act shall be imprisoned not more
 than 5 years, fined not more than $1,000,000 per day for each day during
 which the violation continues, or both.'; and
 (2) by amending subsection (b) to read as follows:
 `(b) CIVIL MONEY PENALTY-
 `(1) PENALTY- Any company which violates, and any individual who participates
 in a violation of, any provision of this Act, or any regulation or order
 issued pursuant thereto, shall forfeit and pay a civil penalty of not more
 than $25,000 for each day during which such violation continues.
 `(2) ASSESSMENT; ETC- Any penalty imposed under paragraph (1) may be assessed
 and collected by the Board in the manner provided in subparagraphs (E),
 (F), (G), and (I) of section 8(i)(2) of the Federal Deposit Insurance Act
 for penalties imposed (under such section) and any such assessment shall
 be subject to the provisions of such section.
 `(3) HEARING- The company or other person against whom any penalty is
 assessed under this subsection shall be afforded an agency hearing if such
 association or person submits a request for such hearing within 20 days
 after the issuance of the notice of assessment. Section 8(h) of the Federal
 Deposit Insurance Act shall apply to any proceeding under this subsection.
 `(4) DISBURSEMENT- All penalties collected under authority of this subsection
 shall be deposited into the Treasury.
 `(5) VIOLATE DEFINED- For purposes of this section, the term `violate'
 includes any action (alone or with another or others) for or toward causing,
 bringing about, participating in, counseling, or aiding or abetting a
 violation.
 `(6) REGULATIONS- The Board shall prescribe regulations establishing such
 procedures as may be necessary to carry out this subsection.'.
 (k) SAVINGS AND LOAN HOLDING COMPANIES- Section 10(i) of the Home Owners
 Loan Act of 1933 (as amended by section 301 of this Act) is amended--
 (1) by striking paragraphs (1) and (2) and inserting in lieu thereof the
 following:
 `(1) CRIMINAL PENALTY-
 `(A) Whoever knowingly violates any provision of this section or being
 a company, violates any regulation or order issued by the Director under
 this section, shall be imprisoned not more than 1 year, fined not more than
 $100,000 per day for each day during which the violation continues, or both.
 `(B) Whoever, with the intent to deceive, defraud, or profit significantly,
 knowingly violates any provision of this section shall be fined not more
 than $1,000,000 per day for each day during which the violation continues,
 imprisoned not more than 5 years, or both.';
 (2) by redesignating paragraphs (3) and (4) as paragraphs (2) and (3),
 respectively; and
 (3) by amending paragraph (3) (as so redesignated by paragraph (2) of this
 subsection) to read as follows:
 `(3) CIVIL MONEY PENALTY-
 `(A) PENALTY- Any company which violates, and any person who participates in
 a violation of, any provision of this section, or any regulation or order
 issued pursuant thereto, shall forfeit and pay a civil penalty of not more
 than $25,000 for each day during which such violation continues.
 `(B) ASSESSMENT; ETC- Any penalty imposed under subparagraph (A) may be
 assessed and collected by the Director in the manner provided in subparagraphs
 (E), (F), (G), and (I) of section 8(i)(2) of the Federal Deposit Insurance
 Act for penalties imposed (under such section) and any such assessment
 shall be subject to the provisions of such section.
 `(C) HEARING- The company or other person against whom any penalty is assessed
 under this paragraph shall be afforded an agency hearing if such company or
 person submits a request for such hearing within 20 days after the issuance
 of the notice of assessment. Section 8(h) of the Federal Deposit Insurance
 Act shall apply to any proceeding under this paragraph.
 `(D) DISBURSEMENT- All penalties collected under authority of this paragraph
 shall be deposited into the Treasury.
 `(E) VIOLATE DEFINED- For purposes of this section, the term `violate'
 includes any action (alone or with another or others) for or toward causing,
 bringing about, participating in, counseling, or aiding or abetting a
 violation.
 `(F) REGULATIONS- The Director shall prescribe regulations establishing
 such procedures as may be necessary to carry out this paragraph.'.
 (l) EFFECTIVE DATE- The amendments made by this section shall apply with
 respect to conduct engaged in by any person after the date of the enactment
 of this Act, except that the increased maximum civil penalties of $5,000
 and $25,000 per violation or per day may apply to such conduct engaged in
 before such date if such conduct--
 (1) is not already subject to a notice (initiating an administrative
 proceeding) issued by the appropriate Federal banking agency (as defined in
 section 3(q) of the Federal Deposit Insurance Act) or the National Credit
 Union Administration Board; and
 (2) occurred after the completion of the last report of examination of
 the institution involved by the appropriate Federal banking agency (as so
 defined) occurring before the date of the enactment of this Act.
SEC. 908. CLARIFICATION OF CRIMINAL PENALTY PROVISIONS FOR VIOLATION OF
CERTAIN ORDERS.
 (a) DEPOSITORY INSTITUTIONS INSURED BY THE FDIC- Section 8(j) of the Federal
 Deposit Insurance Act (12 U.S.C. 1818(j)) is amended to read as follows:
 `(j) CRIMINAL PENALTY- Whoever, being subject to an order in effect under
 subsection (e) or (g), without the prior written approval of the appropriate
 Federal financial institutions regulatory agency, knowingly participates,
 directly or indirectly, in any manner (including by engaging in an activity
 specifically prohibited in such an order or in subsection (e)(6)) in the
 conduct of the affairs of--
 `(1) any insured depository institution;
 `(2) any institution treated as an insured bank under subsection (b)(3) or
 (b)(4), or as a savings association under subsection (b)(8);
 `(3) any insured credit union (as defined in section 101(7) of the Federal
 Credit Union Act);
 `(4) any institution chartered under the Farm Credit Act of 1971; or
 `(5) the Resolution Trust Corporation,
shall be fined not more than $1,000,000, imprisoned for not more than 5 years,
or both.'.
 (b) CREDIT UNIONS INSURED BY THE NCUA- Section 206(l) of the Federal Credit
 Union Act (12 U.S.C. 1786(l)) is amended to read as follows:
 `(l) CRIMINAL PENALTY FOR VIOLATION OF CERTAIN ORDERS- Whoever--
 `(1) under this Act, is suspended or removed from, or prohibited from
 participating in the affairs of any credit union described in section
 206(g)(5); and
 `(2) knowingly participates, directly or indirectly, in any manner (including
 by engaging in an activity specifically prohibited in such an order or in
 subsection (g)(5)) in the conduct of the affairs of such a credit union;
shall be fined not more than $1,000,000, imprisoned for not more than 5 years,
or both.'.
SEC. 909. SUPERVISORY RECORDS.
 Section 11 of the Federal Deposit Insurance Act (12 U.S.C. 1821) is amended
 by inserting after subsection (m) (as added by section 214 of this Act)
 the following new subsection:
 `(o) SUPERVISORY RECORDS- In addition to the requirements of section 7(a)(2)
 to provide to the Corporation copies of reports of examination and reports
 of condition, whenever the Corporation has been appointed as receiver for an
 insured depository institution, the appropriate Federal banking agency shall
 make available all supervisory records to the receiver which may be used
 by the receiver in any manner the receiver determines to be appropriate.'.
SEC. 910. INCREASED PENALTY FOR PARTICIPATION BY CONVICTED INDIVIDUALS.
 (a) BANKS INSURED BY THE FDIC- Section 19 of the Federal Deposit Insurance
 Act (12 U.S.C. 1829) is amended to read as follows:
`SEC. 19. PENALTY FOR UNAUTHORIZED PARTICIPATION BY CONVICTED INDIVIDUAL.
 `(a) PROHIBITION- Except with the prior written consent of the Corporation--
 `(1) any person who has been convicted of any criminal offense involving
 dishonesty or a breach of trust may not participate, directly or indirectly,
 in any manner in the conduct of the affairs of an insured depository
 institution; and
 `(2) an insured depository institution may not permit such participation.
 `(b) PENALTY- Whoever knowingly violates subsection (a) shall be fined not
 more than $1,000,000 for each day such prohibition is violated or imprisoned
 for not more than 5 years, or both.'.
 (b) CREDIT UNIONS INSURED BY THE NCUA- Section 205(d) of the Federal Credit
 Union Act (12 U.S.C. 1785(d)) is amended to read as follows:
 `(d) PENALTY FOR PROHIBITED PARTICIPATION-
 `(1) PROHIBITION- Except with the prior written consent of the Board--
 `(A) any person who has been convicted of any criminal offense involving
 dishonesty or a breach of trust may not participate, directly or indirectly,
 in any manner in the conduct of the affairs of an insured credit union; and
 `(B) an insured credit union may not permit such participation.
 `(2) PENALTY- Whoever knowingly violates paragraph (1) shall be fined not
 more than $1,000,000 for each day such prohibition is violated or imprisoned
 for not more than 5 years, or both.'.
SEC. 911. AMENDMENTS TO VARIOUS PROVISIONS OF LAW RELATING TO REPORTS.
 (a) BANK PROTECTION ACT- Section 3(b) of the Bank Protection Act of 1968 (12
 U.S.C. 1882) is amended by striking out `and shall require the submission
 of periodic reports with respect to the installation, maintenance, and
 operation of security devices and procedures'.
 (b) AMENDMENTS RELATING TO NATIONAL BANKS-
 (1) Section 5211 of the Revised Statutes (12 U.S.C. 161) is amended--
 (A) in the 5th sentence of subsection (a), by striking out `within ten
 days after the receipt of a request therefor from him' and inserting in
 lieu thereof `within the period of time specified by the Comptroller'; and
 (B) in subsection (c), by striking out the last sentence.
 (2) Section 5213 of the Revised Statutes (12 U.S.C. 164) is amended to read
 as follows:
`SEC. 5213. PENALTY FOR FAILURE TO MAKE REPORTS.
 `(a) FIRST TIER- Any association which--
 `(1) maintains procedures reasonably adapted to avoid any inadvertent error
 and, unintentionally and as a result of such an error--
 `(A) fails to make, obtain, transmit, or publish any report or information
 required by the Comptroller of the Currency under section 5211 of this
 chapter, within the period of time specified by the Comptroller; or
 `(B) submits or publishes any false or misleading report or information; or
 `(2) inadvertently transmits or publishes any report which is minimally late,
shall be subject to a penalty of not more than $2,000 for each day during
which such failure continues or such false or misleading information is not
corrected. The association shall have the burden of proving that an error was
inadvertent and that a report was inadvertently transmitted or published late.
 `(b) SECOND TIER- Any association which--
 `(1) fails to make, obtain, transmit, or publish any report or information
 required by the Comptroller of the Currency under section 5211 of this
 chapter, within the period of time specified by the Comptroller; or
 `(2) submits or publishes any false or misleading report or information,
in a manner not described in subsection (a) shall be subject to a penalty
of not more than $20,000 for each day during which such failure continues
or such false or misleading information is not corrected.
 `(c) THIRD TIER- Notwithstanding subsections (a) and (b), if any association
 knowingly or with reckless disregard for the accuracy of any information
 or report described in subsection (b) submits or publishes any false or
 misleading report or information, the Comptroller may assess a penalty of
 not more than $1,000,000 or 1 percent of total assets of the association,
 whichever is less, per day for each day during which such failure continues
 or such false or misleading information is not corrected.
 `(d) ASSESSMENT; ETC- Any penalty imposed under subsection (a), (b), or
 (c) shall be assessed and collected by the Comptroller of the Currency
 in the manner provided in subparagraphs (E), (F), (G), and (I) of section
 8(i)(2) of the Federal Deposit Insurance Act (for penalties imposed under
 such section) and any such assessment (including the determination of the
 amount of the penalty) shall be subject to the provisions of such section.
 `(e) HEARING- Any association against which any penalty is assessed under
 this subsection shall be afforded an agency hearing if such association
 submits a request for such hearing within 20 days after the issuance of
 the notice of assessment. Section 8(h) of the Federal Deposit Insurance
 Act shall apply to any proceeding under this section.'.
 (c) AMENDMENT RELATING TO STATE NONMEMBER INSURED BANKS- Section 7(a)(1)
 of the Federal Deposit Insurance Act (12 U.S.C. 1817(a)(1)) is amended by
 striking out the last sentence and inserting in lieu thereof the following
 new sentences: `Any such bank which (A) maintains procedures reasonably
 adapted to avoid any inadvertent error and, unintentionally and as a result
 of such an error, fails to make or publish any report required under this
 paragraph, within the period of time specified by the Corporation, or
 submits or publishes any false or misleading report or information, or (B)
 inadvertently transmits or publishes any report which is minimally late,
 shall be subject to a penalty of not more than $2,000 for each day during
 which such failure continues or such false or misleading information
 is not corrected. Such bank shall have the burden of proving that an
 error was inadvertent and that a report was inadvertently transmitted or
 published late. Any such bank which fails to make or publish any report
 required under this paragraph, within the period of time specified by
 the Corporation, or submits or publishes any false or misleading report
 or information, in a manner not described in the 2nd preceding sentence
 shall be subject to a penalty of not more than $20,000 for each day during
 which such failure continues or such false or misleading information is
 not corrected. Notwithstanding the preceding sentence, if any such bank
 knowingly or with reckless disregard for the accuracy of any information
 or report described in such sentence submits or publishes any false or
 misleading report or information, the Corporation may assess a penalty
 of not more than $1,000,000 or 1 percent of total assets of such bank,
 whichever is less, per day for each day during which such failure continues
 or such false or misleading information is not corrected. Any penalty imposed
 under any of the 4 preceding sentences shall be assessed and collected by
 the Corporation in the manner provided in subparagraphs (E), (F), (G), and
 (I) of section 8(i)(2) (for penalties imposed under such section) and any
 such assessment (including the determination of the amount of the penalty)
 shall be subject to the provisions of such section. Any such bank against
 which any penalty is assessed under this subsection shall be afforded an
 agency hearing if such bank submits a request for such hearing within 20
 days after the issuance of the notice of assessment. Section 8(h) shall
 apply to any proceeding under this paragraph.'.
 (d) AMENDMENT RELATING TO STATE MEMBER BANKS- The 6th undesignated paragraph
 of section 9 of the Federal Reserve Act (12 U.S.C. 324) is amended by
 striking out the penultimate sentence and inserting in lieu thereof
 the following new sentences: `Any bank which (A) maintains procedures
 reasonably adapted to avoid any inadvertent error and, unintentionally and
 as a result of such an error, fails to make or publish any report required
 under this paragraph, within the period of time specified by the Board, or
 submits or publishes any false or misleading report or information, or (B)
 inadvertently transmits or publishes any report which is minimally late,
 shall be subject to a penalty of not more than $2,000 for each day during
 which such failure continues or such false or misleading information is
 not corrected. The bank shall have the burden of proving that an error was
 inadvertent and that a report was inadvertently transmitted or published
 late. Any bank which fails to make or publish such reports within the
 period of time specified by the Board, or submits or publishes any false
 or misleading report or information, in a manner not described in the 2nd
 preceding sentence shall be subject to a penalty of not more than $20,000 for
 each day during which such failure continues or such false or misleading
 information is not corrected. Notwithstanding the preceding sentence,
 if any bank knowingly or with reckless disregard for the accuracy of any
 information or report described in such sentence submits or publishes
 any false or misleading report or information, the Board may assess a
 penalty of not more than $1,000,000 or 1 percent of total assets of such
 bank, whichever is less, per day for each day during which such failure
 continues or such false or misleading information is not corrected. Any
 penalty imposed under any of the 4 preceding sentences shall be assessed
 and collected by the Board in the manner provided in subparagraphs (E),
 (F), (G), and (I) of section 8(i)(2) of the Federal Deposit Insurance
 Act (for penalties imposed under such section) and any such assessment
 (including the determination of the amount of the penalty) shall be subject
 to the provisions of such section. Any bank against which any penalty is
 assessed under thi