1. U.S. Code
  2. title 12
  3. chapter 16
  4. § 1829b

Collapse to view only § 1829b. Retention of records by insured depository institutions

§ 1811. Federal Deposit Insurance Corporation
(a) Establishment of Corporation
(b) Asset disposition division
(1) Establishment
(2) Management
(3) Responsibilities of division
(Sept. 21, 1950, ch. 967, § 2[1], 64 Stat. 873; Pub. L. 101–73, title II, § 202, Aug. 9, 1989, 103 Stat. 188; Pub. L. 103–204, § 22(a), Dec. 17, 1993, 107 Stat. 2407.)

CITE AS: 12 USC 1811

§ 1812. 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 Consumer Financial Protection Bureau; 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, 1 of whom shall have State bank supervisory experience.
(2) Political affiliation
(b) Chairperson and Vice Chairperson
(1) Chairperson
(2) Vice Chairperson
(3) Acting Chairperson
(c) Terms
(1) Appointed members
(2) Interim appointments
(3) Continuation of service
(d) Vacancy
(1) In general
(2) Acting officials may serve
(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
(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
(f) Status of employees
(1) In general
(2) “Employee of the Corporation” defined
(3) Effect on other law
This subsection does not affect—
(A) any other immunities and protections that may be available to such person under applicable law with respect to such transactions, or
(B) any other right or remedy against the Corporation, against the United States under applicable law, or against any person other than a person described in paragraph (1) participating in such transactions.
This subsection shall not be construed to limit or alter in any way the immunities that are available under applicable law for Federal officials and employees not described in this subsection.
(Sept. 21, 1950, ch. 967, § 2[2], 64 Stat. 873; Pub. L. 86–230, § 19, Sept. 8, 1959, 73 Stat. 460; Pub. L. 98–181, title I [title VII, § 702(a)], Nov. 30, 1983, 97 Stat. 1267; Pub. L. 101–73, title II, § 203(a), Aug. 9, 1989, 103 Stat. 188; Pub. L. 102–18, title I, § 103(b), Mar. 23, 1991, 105 Stat. 60; Pub. L. 104–208, div. A, title II, § 2243, Sept. 30, 1996, 110 Stat. 3009–419; Pub. L. 111–203, title III, § 336(a), July 21, 2010, 124 Stat. 1540.)

CITE AS: 12 USC 1812

§ 1813. DefinitionsAs used in this chapter—
(a) Definitions of bank and related terms
(1) BankThe term “bank”—
(A) means any national bank and State bank, and any Federal branch and insured branch;
(B) includes any former savings association.
(2) State bank
(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,
including any cooperative bank or other unincorporated bank the deposits of which were insured by the Corporation on the day before August 9, 1989.
(3) State
(b) Definition of savings associations and related terms
(1) Savings associationThe 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 Comptroller of the Currency jointly determine to be operating in substantially the same manner as a savings association.
(2) Federal savings association
(3) State savings associationThe 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
(1) Depository institution
(2) Insured depository institution
(3) Institutions included for certain purposes
(4) Federal depository institution
(5) State depository institution
(d) Definitions relating to member banks
(1) National member bank
(2) State member bank
(e) Definitions relating to nonmember banks
(1) National nonmember bankThe 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
(f) Mutual savings bank
(g) Savings bank
(h) Insured bank
(i) New depository institution and bridge depository institution defined
(1) New depository institution
(2) Bridge depository institution
(j) Receiver
(k) Board of Directors
(l) DepositThe term “deposit” means—
(1) the unpaid balance of money or its equivalent received or held by a bank or savings association in the usual course of business and for which it has given or is obligated to give credit, either conditionally or unconditionally, to a commercial, checking, savings, time, or thrift account, or which is evidenced by its certificate of deposit, thrift certificate, investment certificate, certificate of indebtedness, or other similar name, or a check or draft drawn against a deposit account and certified by the bank or savings association, or a letter of credit or a traveler’s check on which the bank or savings association is primarily liable: Provided, That, without limiting the generality of the term “money or its equivalent”, any such account or instrument must be regarded as evidencing the receipt of the equivalent of money when credited or issued in exchange for checks or drafts or for a promissory note upon which the person obtaining any such credit or instrument is primarily or secondarily liable, or for a charge against a deposit account, or in settlement of checks, drafts, or other instruments forwarded to such bank or savings association for collection.
(2) trust funds as defined in this chapter received or held by such bank or savings association, whether held in the trust department or held or deposited in any other department of such bank or savings association.
(3) money received or held by a bank or savings association, or the credit given for money or its equivalent received or held by a bank or savings association, in the usual course of business for a special or specific purpose, regardless of the legal relationship thereby established, including without being limited to, escrow funds, funds held as security for an obligation due to the bank or savings association or others (including funds held as dealers reserves) or for securities loaned by the bank or savings association, funds deposited by a debtor to meet maturing obligations, funds deposited as advance payment on subscriptions to United States Government securities, funds held for distribution or purchase of securities, funds held to meet its acceptances or letters of credit, and withheld taxes: Provided, That there shall not be included funds which are received by the bank or savings association for immediate application to the reduction of an indebtedness to the receiving bank or savings association, or under condition that the receipt thereof immediately reduces or extinguishes such an indebtedness.
(4) outstanding draft (including advice or authorization to charge a bank’s or a savings association’s balance in another bank or savings association), cashier’s check, money order, or other officer’s check issued in the usual course of business for any purpose, including without being limited to those issued in payment for services, dividends, or purchases, and
(5) such other obligations of a bank or savings association as the Board of Directors, after consultation with the Comptroller of the Currency, and the Board of Governors of the Federal Reserve System, shall find and prescribe by regulation to be deposit liabilities by general usage, except that the following shall not be a deposit for any of the purposes of this chapter or be included as part of the total deposits or of an insured deposit:
(A) any obligation of a depository institution which is carried on the books and records of an office of such bank or savings association located outside of any State, unless—
(i) such obligation would be a deposit if it were carried on the books and records of the depository institution, and would be payable at, an office located in any State; and
(ii) the contract evidencing the obligation provides by express terms, and not by implication, for payment at an office of the depository institution located in any State;
(B) any international banking facility deposit, including an international banking facility time deposit, as such term is from time to time defined by the Board of Governors of the Federal Reserve System in regulation D or any successor regulation issued by the Board of Governors of the Federal Reserve System; and
(C) any liability of an insured depository institution that arises under an annuity contract, the income of which is tax deferred under section 72 of title 26.
(m) Insured deposit
(1)In general.—Subject to paragraph (2), the term “insured deposit” means the net amount due to any depositor for deposits in an insured depository institution as determined under sections 1817(i) and 1821(a) of this title.
(2) In the case of any deposit in a branch of a foreign bank, the term “insured deposit” means an insured deposit as defined in paragraph (1) of this subsection which—
(A) is payable in the United States to—
(i) an individual who is a citizen or resident of the United States,
(ii) a partnership, corporation, trust, or other legally cognizable entity created under the laws of the United States or any State and having its principal place of business within the United States or any State, or
(iii) an individual, partnership, corporation, trust, or other legally cognizable entity which is determined by the Board of Directors in accordance with its regulations to have such business or financial relationships in the United States as to make the insurance of such deposit consistent with the purposes of this chapter;
and
(B) meets any other criteria prescribed by the Board of Directors by regulation as necessary or appropriate in its judgment to carry out the purposes of this chapter or to facilitate the administration thereof.
(3)Uninsured deposits.—The term “uninsured deposit” means the amount of any deposit of any depositor at any insured depository institution in excess of the amount of the insured deposits of such depositor (if any) at such depository institution.
(4)Preferred deposits.—The term “preferred deposits” means deposits of any public unit (as defined in paragraph (1)) at any insured depository institution which are secured or collateralized as required under State law.
(n) Transferred deposit
(o) Domestic branch
(p) Trust funds
(q) Appropriate Federal banking agencyThe term “appropriate Federal banking agency” means—
(1) the Office of the Comptroller of the Currency, in the case of—
(A) any national banking association;
(B) any Federal branch or agency of a foreign bank; and
(C) any Federal savings association;
(2) the Federal Deposit Insurance Corporation, in the case of—
(A) any State nonmember insured bank;
(B) any foreign bank having an insured branch; and
(C) any State savings association; 1
1 So in original. Probably should be followed by “and”.
(3) the Board of Governors of the Federal Reserve System, in the case of—
(A) any State member bank;
(B) any branch or agency of a foreign bank with respect to any provision of the Federal Reserve Act [12 U.S.C. 221 et seq.] which is made applicable under the International Banking Act of 1978 [12 U.S.C. 3101 et seq.];
(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 [12 U.S.C. 3105(c)(1)], including such proceedings under the Financial Institutions Supervisory Act of 1966;
(F) any bank holding company and any subsidiary (other than a depository institution) of a bank holding company; and
(G) any savings and loan holding company and any subsidiary (other than a depository institution) of a 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.
(r) State bank supervisor
(1) In general
(2) Interstate application
(s) Definitions relating to foreign banks and branches
(1) Foreign bank
(2) Federal branch
(3) Insured branch
(t) Includes, including
(1) In general
(2) Rule of construction
(u) Institution-affiliated partyThe term “institution-affiliated party” means—
(1) any director, officer, employee, or controlling stockholder (other than a bank holding company or savings and loan 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 1817(j) of this title;
(3) any shareholder (other than a bank holding company or savings and loan 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
(w) Definitions relating to affiliates of depository institutions
(1) Depository institution holding company
(2) Bank holding company
(3) Savings and loan holding company
(4) SubsidiaryThe 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
(6) Affiliate
(7) Company
(x) Definitions relating to default
(1) Default
(2) In danger of defaultThe 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.
(y) Definitions relating to Deposit Insurance Fund
(1) Deposit Insurance Fund
(2) Designated reserve ratio
(3) Reserve ratio
(z) Federal banking agency
(Sept. 21, 1950, ch. 967, § 2[3], 64 Stat. 873; July 14, 1952, ch. 725, 66 Stat. 605; Aug. 1, 1956, ch. 852, § 3, 70 Stat. 908; Pub. L. 86–671, § 1, July 14, 1960, 74 Stat. 546; Pub. L. 89–695, title II, § 201, title III, §§ 301(a), 303(a), Oct. 16, 1966, 80 Stat. 1046, 1055, 1056; Pub. L. 91–151, § 7(a)(1), Dec. 23, 1969, 83 Stat. 375; Pub. L. 91–609, title IX, § 910(a)–(f), Dec. 31, 1970, 84 Stat. 1811, 1812; Pub. L. 93–495, title I, §§ 101(a)(1), 102(a)(1), Oct. 28, 1974, 88 Stat. 1500, 1502; Pub. L. 95–369, § 6(c)(2)–(6), Sept. 17, 1978, 92 Stat. 614, 615; Pub. L. 95–630, title III, § 301(a), Nov. 10, 1978, 92 Stat. 3675; Pub. L. 96–221, title III, § 308(a)(1)(A), Mar. 31, 1980, 94 Stat. 147; Pub. L. 97–110, title I, §§ 102, 103(a), Dec. 26, 1981, 95 Stat. 1513; Pub. L. 97–320, title I, § 113(a), (b), title VII, § 703(a), (b), Oct. 15, 1982, 96 Stat. 1473, 1538, 1539; Pub. L. 100–86, title I, § 101(g)(1), title V, § 503(b), Aug. 10, 1987, 101 Stat. 563, 632; Pub. L. 101–73, title II, §§ 201(a), 204, Aug. 9, 1989, 103 Stat. 187, 190; Pub. L. 102–242, title I, §§ 111(e), 112(b), 131(c)(3), 141(f), 161(c), title III, §§ 305(c), 311(b)(5)(A), Dec. 19, 1991, 105 Stat. 2242, 2266, 2278, 2286, 2355, 2366; Pub. L. 102–550, title XVI, §§ 1603(b)(2)(B), (d)(5), 1606(g)(2), Oct. 28, 1992, 106 Stat. 4079, 4080, 4089; Pub. L. 103–204, § 19(b), Dec. 17, 1993, 107 Stat. 2404; Pub. L. 103–325, title III, § 326(b)(2), title VI, § 602(a)(1), Sept. 23, 1994, 108 Stat. 2229, 2288; Pub. L. 104–208, div. A, title II, §§ 2205(b), 2614(a), 2704(d)(6)(A), (14)(A), Sept. 30, 1996, 110 Stat. 3009–405, 3009–478, 3009–488, 3009–490; Pub. L. 108–386, § 8(a)(1), Oct. 30, 2004, 118 Stat. 2231; Pub. L. 109–171, title II, §§ 2102(b), 2107(b), Feb. 8, 2006, 120 Stat. 9, 19; Pub. L. 109–173, §§ 4(a), 8(a)(1), Feb. 15, 2006, 119 Stat. 3606, 3610; Pub. L. 109–351, title VII, § 725(d), Oct. 13, 2006, 120 Stat. 2002; Pub. L. 109–356, title I, § 123(d), Oct. 16, 2006, 120 Stat. 2029; Pub. L. 110–289, div. A, title VI, § 1604(b)(1)(A), July 30, 2008, 122 Stat. 2829; Pub. L. 111–203, title III, §§ 312(c), 334(b), 363(1), July 21, 2010, 124 Stat. 1522, 1539, 1550.)

CITE AS: 12 USC 1813

§ 1814. Insured depository institutions
(a) Continuation of insurance
(1) Banks
(2) Savings associations
(b) Continuation of insurance upon becoming a member bank
(c) Continuation of insurance after conversion
Subject to section 1815(d) of this title and section 1464(i)(5) of this title—
(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 or Federal depository institution,
shall continue as an insured depository institution.
(d) Continuation of insurance after merger or consolidation
(Sept. 21, 1950, ch. 967, § 2[4], 64 Stat. 875; Pub. L. 97–320, title I, § 113(c), Oct. 15, 1982, 96 Stat. 1473; Pub. L. 101–73, title II, §§ 201(a), 205, Aug. 9, 1989, 103 Stat. 187, 194; Pub. L. 102–242, title I, § 115(b), Dec. 19, 1991, 105 Stat. 2249; Pub. L. 102–550, title XVI, § 1603(b)(6), Oct. 28, 1992, 106 Stat. 4079; Pub. L. 109–351, title VI, § 608(b), Oct. 13, 2006, 120 Stat. 1983.)

CITE AS: 12 USC 1814

§ 1815. Deposit insurance
(a) Application to Corporation required
(1) In general
(2) Interim depository institutions
(3) Application and approval not required in cases of continued insurance
(4) Review requirements
(5) Notice of denial of application for insurance
(6) Nondelegation requirement
(b) Foreign branch nonmember banks; matters consideredSubject to the provisions of this chapter and to such terms and conditions as the Board of Directors may impose, any branch of a foreign bank, upon application by the bank to the Corporation, and examination by the Corporation of the branch, and approval by the Board of Directors, may become an insured branch. Before approving any such application, the Board of Directors shall give consideration to—
(1) the financial history and condition of the bank,
(2) the adequacy of its capital structure,
(3) its future earnings prospects,
(4) the general character and fitness of its management, including but not limited to the management of the branch proposed to be insured,
(5) the risk presented to the Deposit Insurance Fund,
(6) the convenience and needs of the community to be served by the branch,
(7) whether or not its corporate powers, insofar as they will be exercised through the proposed insured branch, are consistent with the purposes of this chapter, and
(8) the probable adequacy and reliability of information supplied and to be supplied by the bank to the Corporation to enable it to carry out its functions under this chapter.
(c) Protection to Deposit Insurance Fund; surety bond, pledge of assets, etc.; injunction
(1) Before any branch of a foreign bank becomes an insured branch, the bank shall deliver to the Corporation or as the Corporation may direct a surety bond, a pledge of assets, or both, in such amounts and of such types as the Corporation may require or approve, for the purpose set forth in paragraph (4) of this subsection.
(2) After any branch of a foreign bank becomes an insured branch, the bank shall maintain on deposit with the Corporation, or as the Corporation may direct, surety bonds or assets or both, in such amounts and of such types as shall be determined from time to time in accordance with such regulations as the Board of Directors may prescribe. Such regulations may impose differing requirements on the basis of any factors which in the judgment of the Board of Directors are reasonably related to the purpose set forth in paragraph (4).
(3) The Corporation may require of any given bank larger deposits of bonds and assets than required under paragraph (2) of this subsection if, in the judgment of the Corporation, the situation of that bank or any branch thereof is or becomes such that the deposits of bonds and assets otherwise required under this section would not adequately fulfill the purpose set forth in paragraph (4). The imposition of any such additional requirements may be without notice or opportunity for hearing, but the Corporation shall afford an opportunity to any such bank to apply for a reduction or removal of any such additional requirements so imposed.
(4) The purpose of the surety bonds and pledges of assets required under this subsection is to provide protection to the Deposit Insurance Fund against the risks entailed in insuring the domestic deposits of a foreign bank whose activities, assets, and personnel are in large part outside the jurisdiction of the United States. In the implementation of its authority under this subsection, however, the Corporation shall endeavor to avoid imposing requirements on such banks which would unnecessarily place them at a competitive disadvantage in relation to domestically incorporated banks.
(5) In the case of any failure or threatened failure of a foreign bank to comply with any requirement imposed under this subsection (c), the Corporation, in addition to all other administrative and judicial remedies, may apply to any United States district court, or United States court of any territory, within the jurisdiction of which any branch of the bank is located, for an injunction to compel such bank and any officer, employee, or agent thereof, or any other person having custody or control of any of its assets, to deliver to the Corporation such assets as may be necessary to meet such requirement, and to take any other action necessary to vest the Corporation with control of assets so delivered. If the court shall determine that there has been any such failure or threatened failure to comply with any such requirement, it shall be the duty of the court to issue such injunction. The propriety of the requirement may be litigated only as provided in chapter 7 of title 5, and may not be made an issue in an action for an injunction under this paragraph.
(d) Insurance fees
(1) In general
(2) Fee credited to the Deposit Insurance Fund
(3) Exception for certain depository institutions
(e) Liability of commonly controlled depository institutions
(1) In general
(A) Liability establishedAny insured depository institution shall be liable for any loss incurred by the Corporation, or any loss which the Corporation reasonably anticipates incurring, after August 9, 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
(C) Notice required to be provided within 2 years of loss
(2) Amount of compensation; procedures
(A) Use of estimatesWhen 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 paymentThe 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) PriorityThe liability of any insured depository institution under this subsection shall have priority with respect to other obligations and liabilities as follows:
(i) SuperiorityThe 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) SubordinationThe 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
(ii) Underpayment
(3) Review
(A) Judicial
(B) AdministrativeThe 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 partiesTo 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—
(A) the obligations of such insured depository institution shall supersede such right or power; and
(B) no court may give effect to such right or power with respect to such insured depository institution.
(5) Waiver authority
(A) In general
(B) Condition
(C) Limited partnerships
(i) In general
(ii) Review and notice
(6) Exclusion for institutions acquired in debt collectionsAny 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 August 9, 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 371c and 371c–1 of this title, without regard to section 371c(d)(1) of this title, in transactions with the acquired insured depository institution.
(7) Exception for certain FSLIC assisted institutionsNo 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 August 9, 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.
(8) Commonly controlled definedFor purposes of this subsection, depository institutions are commonly controlled if—
(A) such institutions are controlled by the same company; or
(B) 1 depository institution is controlled by another depository institution.
(Sept. 21, 1950, ch. 967, § 2[5], 64 Stat. 876; Pub. L. 95–369, § 6(c)(7), Sept. 17, 1978, 92 Stat. 616; Pub. L. 97–320, title VII, § 703(c), Oct. 15, 1982, 96 Stat. 1539; Pub. L. 101–73, title II, §§ 201(a), 206(a), Aug. 9, 1989, 103 Stat. 187, 195; Pub. L. 102–242, title I, § 115(a), title III, § 302(e)(1), (2), title V, § 501(a), Dec. 19, 1991, 105 Stat. 2249, 2349, 2388; Pub. L. 102–550, title XVI, §§ 1605(a)(5)(B), 1607(a), Oct. 28, 1992, 106 Stat. 4085, 4089; Pub. L. 102–558, title III, §§ 303(b)(6)(B), 305, Oct. 28, 1992, 106 Stat. 4225, 4226; Pub. L. 103–204, § 9, Dec. 17, 1993, 107 Stat. 2388; Pub. L. 103–325, title III, § 319(b), title VI, § 602(a)(2), (3), Sept. 23, 1994, 108 Stat. 2225, 2288; Pub. L. 104–208, div. A, title II, §§ 2201(a), 2702(i), 2704(d)(14)(B)–(E), Sept. 30, 1996, 110 Stat. 3009–403, 3009–483, 3009–491; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 8(a)(2)–(6), Feb. 15, 2006, 119 Stat. 3610, 3611; Pub. L. 109–351, title VII, § 703, Oct. 13, 2006, 120 Stat. 1986.)

CITE AS: 12 USC 1815

§ 1816. Factors to be considered
The factors that are required, under section 1814 of this title, to be considered in connection with, and enumerated in, any certificate issued pursuant to section 1814 of this title and that are required, under section 1815 of this title, to be considered by the Board of Directors in connection with any determination by such Board pursuant to section 1815 of this title 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 Deposit 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 chapter.
(Sept. 21, 1950, ch. 967, § 2[6], 64 Stat. 876; Pub. L. 101–73, title II, § 207, Aug. 9, 1989, 103 Stat. 206; Pub. L. 104–208, div. A, title II, § 2704(d)(14)(F), Sept. 30, 1996, 110 Stat. 3009–491; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 8(a)(7), Feb. 15, 2006, 119 Stat. 3611.)

CITE AS: 12 USC 1816

§ 1817. Assessments
(a) Reports of condition; access to reports
(1) Each insured State nonmember bank and each foreign bank having an insured branch which is not a Federal branch shall make to the Corporation reports of condition which shall be in such form and shall contain such information as the Board of Directors may require. Such reports shall be made to the Corporation on the dates selected as provided in paragraph (3) of this subsection and the deposit liabilities shall be reported therein in accordance with and pursuant to paragraphs (4) and (5) of this subsection. The Board of Directors may call for additional reports of condition on dates to be fixed by it and may call for such other reports as the Board may from time to time require. 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 1818(i)(2) of this title (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 1818(h) of this title shall apply to any proceeding under this paragraph.
(2)
(A) The Corporation and, with respect to any State depository institution, any appropriate State bank supervisor for such institution, shall have access to reports of examination made by, and reports of condition made to, the Comptroller of the Currency, the Federal Housing Finance Agency, any Federal home loan bank, or any Federal Reserve bank and to all revisions of reports of condition made to any of them, and they shall promptly advise the Corporation of any revisions or changes in respect to deposit liabilities made or required to be made in any report of condition. The Corporation may accept any report made by or to any commission, board, or authority having supervision of a depository institution, and may furnish to the Comptroller of the Currency, to the Federal Housing Finance Agency, to any Federal home loan bank, to any Federal Reserve bank, and to any such commission, board, or authority, reports of examinations made on behalf of, and reports of condition made to, the Corporation.
(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 consultation with the Comptroller of the Currency and the Board of Governors of the Federal Reserve System, as appropriate, may deem advisable for insurance purposes.
(C)Data sharing with other agencies and persons.—In addition to reports of examination, reports of condition, and other reports required to be regularly provided to the Corporation (with respect to all insured depository institutions, including a depository institution for which the Corporation has been appointed conservator or receiver) or an appropriate State bank supervisor (with respect to a State depository institution) under subparagraph (A) or (B), a Federal banking agency may, in the discretion of the agency, furnish any report of examination or other confidential supervisory information concerning any depository institution or other entity examined by such agency under authority of any Federal law, to—
(i) any other Federal or State agency or authority with supervisory or regulatory authority over the depository institution or other entity;
(ii) any officer, director, or receiver of such depository institution or entity; and
(iii) any other person that the Federal banking agency determines to be appropriate.
(3) Each insured depository institution shall make to the appropriate Federal banking agency 4 reports of condition annually upon dates which shall be selected by the Chairman of the Board of Directors, the Comptroller of the Currency, and the Chairman of the Board of Governors of the Federal Reserve System. The dates selected shall be the same for all insured depository institutions, except that when any of said reporting dates is a nonbusiness day for any depository institution, the preceding business day shall be its reporting date. Such reports of condition shall be the basis for the certified statements to be filed pursuant to subsection (c). The deposit liabilities shall be reported in said reports of conditions in accordance with and pursuant to paragraphs (4) and (5) of this subsection, and such other information shall be reported therein as may be required by the respective agencies. Each said report of condition shall contain a declaration by the president, a vice president, the cashier or the treasurer, or by any other officer designated by the board of directors or trustees of the reporting depository institution to make such declaration, that the report is true and correct to the best of his knowledge and belief. The correctness of said report of condition shall be attested by the signatures of at least two directors or trustees of the reporting depository institution other than the officer making such declaration, with a declaration that the report has been examined by them and to the best of their knowledge and belief is true and correct. At the time of making said reports of condition each insured depository institution shall furnish to the Corporation a copy thereof containing such signed declaration and attestations. Nothing herein shall preclude any of the foregoing agencies from requiring the banks or savings associations under its jurisdiction to make additional reports of condition at any time.
(4) In the reports of condition required to be made by paragraph (3) of this subsection, each insured depository institution shall report the total amount of the liability of the depository institution for deposits in the main office and in any branch located in 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, or the Virgin Islands, according to the definition of the term “deposit” in and pursuant to subsection (l) of section 1813 of this title without any deduction for indebtedness of depositors or creditors or any deduction for cash items in the process of collection drawn on others than the reporting depository institution: Provided, That the depository institution in reporting such deposits may (i) subtract from the deposit balance due to any depository institution the deposit balance due from the same depository institution (other than trust funds deposited by either depository institution) and any cash items in the process of collection due from or due to such depository institutions shall be included in determining such net balance, except that balances of time deposits of any depository institution and any balances standing to the credit of private depository institutions, of depository institutions in foreign countries, of foreign branches of other American depository institutions, and of American branches of foreign banks shall be reported gross without any such subtraction, and (ii) exclude any deposits received in any office of the depository institution for deposit in any other office of the depository institution: And provided further, That outstanding drafts (including advices and authorizations to charge depository institution’s balance in another depository institution) drawn in the regular course of business by the reporting depository institution on depository institutions need not be reported as deposit liabilities. The amount of trust funds held in the depository institution’s own trust department, which the reporting depository institution keeps segregated and apart from its general assets and does not use in the conduct of its business, shall not be included in the total deposits in such reports, but shall be separately stated in such reports. Deposits which are accumulated for the payment of personal loans and are assigned or pledged to assure payment of loans at maturity shall not be included in the total deposits in such reports, but shall be deducted from the loans for which such deposits are assigned or pledged to assure repayment.
(5) The deposits to be reported on such reports of condition shall be segregated between (i) time and savings deposits and (ii) demand deposits. For this purpose, the time and savings deposits shall consist of time certificates of deposit, time deposits-open account, and savings deposits; and demand deposits shall consist of all deposits other than time and savings deposits.
(6)Lifeline account deposits.—In the reports of condition required to be reported under this subsection, the deposits in lifeline accounts (as defined in section 1834(a)(3)(D) of this title) shall be reported separately.
(7) The Board of Directors, after consultation with the Comptroller of the Currency and the Board of Governors of the Federal Reserve System, may by regulation define the terms “cash items” and “process of collection”, and shall classify deposits as “time”, “savings”, and “demand” deposits, for the purposes of this section.
(8) In respect of any report required or authorized to be supplied or published pursuant to this subsection or any other provision of law, the Board of Directors or the Comptroller of the Currency, as the case may be, may differentiate between domestic banks and foreign banks to such extent as, in their judgment, may be reasonably required to avoid hardship and can be done without substantial compromise of insurance risk or supervisory and regulatory effectiveness.
(9)Data collections.—In addition to or in connection with any other report required under this subsection, the Corporation shall take such action as may be necessary to ensure that—
(A) each insured depository institution maintains; and
(B) the Corporation receives on a regular basis from such institution,
information on the total amount of all insured deposits, preferred deposits, and uninsured deposits at the institution. In prescribing reporting and other requirements for the collection of actual and accurate information pursuant to this paragraph, the Corporation shall minimize the regulatory burden imposed upon insured depository institutions that are well capitalized (as defined in section 1831o of this title) while taking into account the benefit of the information to the Corporation, including the use of the information to enable the Corporation to more accurately determine the total amount of insured deposits in each insured depository institution for purposes of compliance with this chapter.
(10) A Federal banking agency may not, by regulation or otherwise, designate, or require an insured institution or an affiliate to designate, a corporation as highly leveraged or a transaction with a corporation as a highly leveraged transaction solely because such corporation is or has been a debtor or bankrupt under title 11, if, after confirmation of a plan of reorganization, such corporation would not otherwise be highly leveraged.
(11)Streamlining reports of condition.—
(A)Review of information and schedules.—Before the end of the 1-year period beginning on October 13, 2006, and before the end of each 5-year period thereafter, each Federal banking agency shall, in conjunction with the other relevant Federal banking agencies, review the information and schedules that are required to be filed by an insured depository institution in a report of condition required under paragraph (3).
(B)Reduction or elimination of information found to be unnecessary.—After completing the review required by subparagraph (A), a Federal banking agency, in conjunction with the other relevant Federal banking agencies, shall reduce or eliminate any requirement to file information or schedules under paragraph (3) (other than information or schedules that are otherwise required by law) if the agency determines that the continued collection of such information or schedules is no longer necessary or appropriate.
(12)Short form reporting.—
(A)In general.—The appropriate Federal banking agencies shall issue regulations that allow for a reduced reporting requirement for a covered depository institution when the institution makes the first and third report of condition for a year, as required under paragraph (3).
(B)Definition.—In this paragraph, the term “covered depository institution” means an insured depository institution that—
(i) has less than $5,000,000,000 in total consolidated assets; and
(ii) satisfies such other criteria as the appropriate Federal banking agencies determine appropriate.
(b) Assessments
(1) Risk-based assessment system
(A) Risk-based assessment system required
(B) Private reinsurance authorizedIn carrying out this paragraph, the Corporation may—
(i) obtain private reinsurance covering not more than 10 percent of any loss the Corporation incurs with respect to an insured depository institution; and
(ii) base that institution’s assessment (in whole or in part) on the cost of the reinsurance.
(C) “Risk-based assessment system” definedFor purposes of this paragraph, the term “risk-based assessment system” means a system for calculating a depository institution’s assessment based on—
(i) the probability that the Deposit Insurance Fund will incur a loss with respect to the institution, taking into consideration the risks attributable to—(I) different categories and concentrations of assets;(II) different categories and concentrations of liabilities, both insured and uninsured, contingent and noncontingent; and(III) any other factors the Corporation determines are relevant to assessing such probability;
(ii) the likely amount of any such loss; and
(iii) the revenue needs of the Deposit Insurance Fund.
(D) Separate assessment systems
(E) Information concerning risk of loss and economic conditions
(i) Sources of information
(ii) Consultation with Federal banking agencies(I) In general(II) Treatment on aggregate basis
(iii) Rule of construction
(F) Modifications to the risk-based assessment system allowed only after notice and comment
(2) Setting assessments
(A) In general
(B) Factors to be consideredIn setting assessments under subparagraph (A), the Board of Directors shall consider the following factors:
(i) The estimated operating expenses of the Deposit Insurance Fund.
(ii) The estimated case resolution expenses and income of the Deposit Insurance Fund.
(iii) The projected effects of the payment of assessments on the capital and earnings of insured depository institutions.
(iv) The risk factors and other factors taken into account pursuant to paragraph (1) under the risk-based assessment system, including the requirement under such paragraph to maintain a risk-based system.
(v) Any other factors the Board of Directors may determine to be appropriate.
(D)2
2 So in original. Par. (2) does not contain a subpar. (C).
Notice of assessments
(E) Bank Enterprise Act requirement
(3) Designated reserve ratio
(A) Establishment
(i) In general
(ii) Rulemaking requirement
(B) Minimum reserve ratio
(C) FactorsIn designating a reserve ratio for any year, the Board of Directors shall—
(i) take into account the risk of losses to the Deposit Insurance Fund in such year and future years, including historic experience and potential and estimated losses from insured depository institutions;
(ii) take into account economic conditions generally affecting insured depository institutions so as to allow the designated reserve ratio to increase during more favorable economic conditions and to decrease during less favorable economic conditions, notwithstanding the increased risks of loss that may exist during such less favorable conditions, as determined to be appropriate by the Board of Directors;
(iii) seek to prevent sharp swings in the assessment rates for insured depository institutions; and
(iv) take into account such other factors as the Board of Directors may determine to be appropriate, consistent with the requirements of this subparagraph.
(D) Publication of proposed change in ratio
(E) DIF restoration plans
(i) In generalWhenever—(I) the Corporation projects that the reserve ratio of the Deposit Insurance Fund will, within 6 months of such determination, fall below the minimum amount specified in subparagraph (B)(ii) for the designated reserve ratio; or(II) the reserve ratio of the Deposit Insurance Fund actually falls below the minimum amount specified in subparagraph (B)(ii) for the designated reserve ratio without any determination under subclause (I) having been made,
 the Corporation shall establish and implement a Deposit Insurance Fund restoration plan within 90 days that meets the requirements of clause (ii) and such other conditions as the Corporation determines to be appropriate.
(ii) Requirements of restoration plan
(iii) Restriction on assessment credits
(iv) Limitation on restrictionNotwithstanding clause (iii), while any restoration plan under this subparagraph is in effect, the Corporation shall apply credits provided to an insured depository institution under subsection (e)(3) against any assessment imposed on the institution for any assessment period in an amount equal to the lesser of—(I) the amount of the assessment; or(II) the amount equal to 3 basis points of the institution’s assessment base.
(v) Transparency
(4) Depository institution required to maintain assessment-related recordsEach insured depository institution shall maintain all records that the Corporation may require for verifying the correctness of any assessment on the insured depository institution under this subsection until the later of—
(A) the end of the 3-year period beginning on the due date of the assessment; or
(B) in the case of a dispute between the insured depository institution and the Corporation with respect to such assessment, the date of a final determination of any such dispute.
(5) Emergency special assessmentsIn addition to the other assessments imposed on insured depository institutions under this subsection, the Corporation may impose 1 or more special assessments on insured depository institutions in an amount determined by the Corporation if the amount of any such assessment is necessary—
(A) to provide sufficient assessment income to repay amounts borrowed from the Secretary of the Treasury under section 1824(a) of this title in accordance with the repayment schedule in effect under section 1824(c) of this title during the period with respect to which such assessment is imposed;
(B) to provide sufficient assessment income to repay obligations issued to and other amounts borrowed from insured depository institutions under section 1824(d) of this title; or
(C) for any other purpose that the Corporation may deem necessary.
(6) Community enterprise credits
(c) Certified statements; payments
(1) Certified statements required
(A) In general
(B) Form of certificationThe certified statement required under subparagraph (A) shall—
(i) be in such form and set forth such supporting information as the Board of Directors shall prescribe; and
(ii) be certified by the president of the depository institution or any other officer designated by its board of directors or trustees that to the best of his or her knowledge and belief, the statement is true, correct and complete, and in accordance with this chapter and regulations issued hereunder.
(2) Payments required
(A) In general
(B) Form of payment
(3) Newly insured institutions
(4) Penalty for failure to make accurate certified statement
(A) First tierAny insured depository institution which—
(i) maintains procedures reasonably adapted to avoid any inadvertent error and, unintentionally and as a result of such an error, fails to submit the certified statement under paragraph (1) within the period of time required under paragraph (1) or submits a false or misleading certified statement; or
(ii) submits the statement at a time which is minimally after the time required in such paragraph,
shall be subject to a penalty of not more than $2,000 for each day during which such failure continues or such false and misleading information is not corrected. The institution shall have the burden of proving that an error was inadvertent or that a statement was inadvertently submitted late.
(B) Second tier
(C) Third tier
(D) Assessment procedure
(E) Hearing
(d) Corporation exempt from apportionment
(e) Refunds, dividends, and credits
(1) Refunds of overpaymentsIn the case of any payment of an assessment by an insured depository institution in excess of the amount due to the Corporation, the Corporation may—
(A) refund the amount of the excess payment to the insured depository institution; or
(B) credit such excess amount toward the payment of subsequent assessments until such credit is exhausted.
(2) Dividends from excess amounts in Deposit Insurance Fund
(A) Reserve ratio in excess of 1.5 percent of estimated insured deposits
(B) Limitation
(C) Notice and opportunity for comment
(3) One-time credit based on total assessment base at year-end 1996
(A) In general
(B) Credit limit
(C) Eligible insured depository institution definedFor purposes of this paragraph, the term “eligible insured depository institution” means any insured depository institution that—
(i) was in existence on December 31, 1996, and paid a deposit insurance assessment prior to that date; or
(ii) is a successor to any insured depository institution described in clause (i).
(D) Application of credits
(i) In general
(ii) Temporary restriction on use of credits
(iii) Regulations
(E) Limitation on amount of credit for certain depository institutions
(F) Successor defined
(4) Administrative review
(A) In general
(B) Administrative review
(f) Action against depository institutions failing to file certified statements
(g) Assessment actions
(1) In general
(2) Statute of limitationsThe following provisions shall apply to actions relating to assessments, notwithstanding any other provision in Federal law, or the law of any State:
(A) Any action by an insured depository institution to recover from the Corporation the overpaid amount of any assessment shall be brought within 3 years after the date the assessment payment was due, subject to the exception in subparagraph (E).
(B) Any action by the Corporation to recover from an insured depository institution the underpaid amount of any assessment shall be brought within 3 years after the date the assessment payment was due, subject to the exceptions in subparagraphs (C) and (E).
(C) If an insured depository institution has made a false or fraudulent statement with intent to evade any or all of its assessment, the Corporation shall have until 3 years after the date of discovery of the false or fraudulent statement in which to bring an action to recover the underpaid amount.
(D) Except as provided in subparagraph (C), assessment deposit information contained in records no longer required to be maintained pursuant to subsection (b)(4) shall be considered conclusive and not subject to change.
(E) Any action for the underpaid or overpaid amount of any assessment that became due before
(h) Forfeiture of rights for failure to comply with law
(i) Insurance of trust funds
(1) In general
(2) Interbank deposits
(3) Bank deposit financial assistance program
(4) Regulations
(j) Change in control of insured depository institutions
(1) No person, acting directly or indirectly or through or in concert with one or more other persons, shall acquire control of any insured depository institution through a purchase, assignment, transfer, pledge, or other disposition of voting stock of such insured depository institution unless the appropriate Federal banking agency has been given sixty days’ prior written notice of such proposed acquisition and within that time period the agency has not issued a notice disapproving the proposed acquisition or, in the discretion of the agency, extending for an additional 30 days the period during which such a disapproval may issue. The period for disapproval under the preceding sentence may be extended not to exceed 2 additional times for not more than 45 days each time if—
(A) the agency determines that any acquiring party has not furnished all the information required under paragraph (6);
(B) in the agency’s judgment, any material information submitted is substantially inaccurate;
(C) the agency has been unable to complete the investigation of an acquiring party under paragraph (2)(B) because of any delay caused by, or the inadequate cooperation of, such acquiring party; or
(D) the agency determines that additional time is needed—
(i) to investigate and determine that no acquiring party has a record of failing to comply with the requirements of subchapter II of chapter 53 of title 31; or
(ii) to analyze the safety and soundness of any plans or proposals described in paragraph (6)(E) or the future prospects of the institution.
An acquisition may be made prior to expiration of the disapproval period if the agency issues written notice of its intent not to disapprove the action.
(2)
(A)Notice to State Agency.—Upon receiving any notice under this subsection, the appropriate Federal banking agency shall forward a copy thereof to the appropriate State depository institution supervisory agency if the depository institution the voting shares of which are sought to be acquired is a State depository institution, and shall allow thirty days within which the views and recommendations of such State depository institution supervisory agency may be submitted. The appropriate Federal banking agency shall give due consideration to the views and recommendations of such State agency in determining whether to disapprove any proposed acquisition. Notwithstanding the provisions of this paragraph, if the appropriate Federal banking agency determines that it must act immediately upon any notice of a proposed acquisition in order to prevent the probable default of the depository institution involved in the proposed acquisition, such Federal banking agency may dispense with the requirements of this paragraph or, if a copy of the notice is forwarded to the State depository institution supervisory agency, such Federal banking agency may request that the views and recommendations of such State depository institution supervisory agency be submitted immediately in any form or by any means acceptable to such Federal banking agency.
(B)Investigation of Principals Required.—Upon receiving any notice under this subsection, the appropriate Federal banking agency shall—
(i) conduct an investigation of the competence, experience, integrity, and financial ability of each person named in a notice of a proposed acquisition as a person by whom or for whom such acquisition is to be made; and
(ii) make an independent determination of the accuracy and completeness of any information described in paragraph (6) with respect to such person.
(C)Report.—The appropriate Federal banking agency shall prepare a written report of any investigation under subparagraph (B) which shall contain, at a minimum, a summary of the results of such investigation. The agency shall retain such written report as a record of the agency.
(D)Public Comment.—Upon receiving notice of a proposed acquisition, the appropriate Federal banking agency shall, unless such agency determines that an emergency exists, within a reasonable period of time—
(i) publish the name of the insured depository institution proposed to be acquired and the name of each person identified in such notice as a person by whom or for whom such acquisition is to be made; and
(ii) solicit public comment on such proposed acquisition, particularly from persons in the geographic area where the bank 4
4 So in original. The word “bank” probably should be “depository institution”.
proposed to be acquired is located, before final consideration of such notice by the agency,
unless the agency determines in writing that such disclosure or solicitation would seriously threaten the safety or soundness of such bank.4
(3) Within three days after its decision to disapprove any proposed acquisition, the appropriate Federal banking agency shall notify the acquiring party in writing of the disapproval. Such notice shall provide a statement of the basis for the disapproval.
(4) Within ten days of receipt of such notice of disapproval, the acquiring party may request an agency hearing on the proposed acquisition. In such hearing all issues shall be determined on the record pursuant to section 554 of title 5. The length of the hearing shall be determined by the appropriate Federal banking agency. At the conclusion thereof, the appropriate Federal banking agency shall by order approve or disapprove the proposed acquisition on the basis of the record made at such hearing.
(5) Any person whose proposed acquisition is disapproved after agency hearings under this subsection may obtain review by the United States court of appeals for the circuit in which the home office of the bank 4 to be acquired is located, or the United States Court of Appeals for the District of Columbia Circuit, by filing a notice of appeal in such court within ten days from the date of such order, and simultaneously sending a copy of such notice by registered or certified mail to the appropriate Federal banking agency. The appropriate Federal banking agency shall promptly certify and file in such court the record upon which the disapproval was based. The findings of the appropriate Federal banking agency shall be set aside if found to be arbitrary or capricious or if found to violate procedures established by this subsection.
(6) Except as otherwise provided by regulation of the appropriate Federal banking agency, a notice filed pursuant to this subsection shall contain the following information:
(A) The identity, personal history, business background and experience of each person by whom or on whose behalf the acquisition is to be made, including his material business activities and affiliations during the past five years, and a description of any material pending legal or administrative proceedings in which he is a party and any criminal indictment or conviction of such person by a State or Federal court.
(B) A statement of the assets and liabilities of each person by whom or on whose behalf the acquisition is to be made, as of the end of the fiscal year for each of the five fiscal years immediately preceding the date of the notice, together with related statements of income and source and application of funds for each of the fiscal years then concluded, all prepared in accordance with generally accepted accounting principles consistently applied, and an interim statement of the assets and liabilities for each such person, together with related statements of income and source and application of funds, as of a date not more than ninety days prior to the date of the filing of the notice.
(C) The terms and conditions of the proposed acquisition and the manner in which the acquisition is to be made.
(D) The identity, source and amount of the funds or other consideration used or to be used in making the acquisition, and if any part of these funds or other consideration has been or is to be borrowed or otherwise obtained for the purpose of making the acquisition, a description of the transaction, the names of the parties, and any arrangements, agreements, or understandings with such persons.
(E) Any plans or proposals which any acquiring party making the acquisition may have to liquidate the bank,4 to sell its assets or merge it with any company or to make any other major change in its business or corporate structure or management.
(F) The identification of any person employed, retained, or to be compensated by the acquiring party, or by any person on his behalf, to make solicitations or recommendations to stockholders for the purpose of assisting in the acquisition, and a brief description of the terms of such employment, retainer, or arrangement for compensation.
(G) Copies of all invitations or tenders or advertisements making a tender offer to stockholders for purchase of their stock to be used in connection with the proposed acquisition.
(H) Any additional relevant information in such form as the appropriate Federal banking agency may require by regulation or by specific request in connection with any particular notice.
(7) The appropriate Federal banking agency may disapprove any proposed acquisition if—
(A) the proposed acquisition of control would result in a monopoly or would be in furtherance of any combination or conspiracy to monopolize or to attempt to monopolize the business of banking in any part of the United States;
(B) the effect of the proposed acquisition of control in any section of the country may be substantially to lessen competition or to tend to create a monopoly or the proposed acquisition of control would in any other manner be in restraint of trade, and the anticompetitive effects of the proposed acquisition of control are not clearly outweighed in the public interest by the probable effect of the transaction in meeting the convenience and needs of the community to be served;
(C) either the financial condition of any acquiring person or the future prospects of the institution is such as might jeopardize the financial stability of the bank 4 or prejudice the interests of the depositors of the bank; 4
(D) the competence, experience, or integrity of any acquiring person or of any of the proposed management personnel indicates that it would not be in the interest of the depositors of the bank, or in the interest of the public to permit such person to control the bank; 4
(E) any acquiring person neglects, fails, or refuses to furnish the appropriate Federal banking agency all the information required by the appropriate Federal banking agency; or
(F) the appropriate Federal banking agency determines that the proposed transaction would result in an adverse effect on the Deposit Insurance Fund.
(8) For the purposes of this subsection, the term—
(A) “person” means an individual or a corporation, partnership, trust, association, joint venture, pool, syndicate, sole proprietorship, unincorporated organization, or any other form of entity not specifically listed herein; and
(B) “control” means the power, directly or indirectly, to direct the management or policies of an insured depository institution or to vote 25 per centum or more of any class of voting securities of an insured depository institution.
(9)Reporting of stock loans.—
(A)Report required.—Any foreign bank, or any affiliate thereof, that has credit outstanding to any person or group of persons which is secured, directly or indirectly, by shares of an insured depository institution shall file a consolidated report with the appropriate Federal banking agency for such insured depository institution if the extensions of credit by the foreign bank or any affiliate thereof, in the aggregate, are secured, directly or indirectly, by 25 percent or more of any class of shares of the same insured depository institution.
(B)Definitions.—For purposes of this paragraph, the following definitions shall apply:
(i)Foreign bank.—The terms “foreign bank” and “affiliate” have the same meanings as in section 3101 of this title.
(ii)Credit outstanding.—The term “credit outstanding” includes—(I) any loan or extension of credit,(II) the issuance of a guarantee, acceptance, or letter of credit, including an endorsement or standby letter of credit, and(III) any other type of transaction that extends credit or financing to the person or group of persons.
(iii)Group of persons.—The term “group of persons” includes any number of persons that the foreign bank or any affiliate thereof reasonably believes—(I) are acting together, in concert, or with one another to acquire or control shares of the same insured depository institution, including an acquisition of shares of the same insured depository institution at approximately the same time under substantially the same terms; or(II) have made, or propose to make, a joint filing under section 78m of title 15 regarding ownership of the shares of the same insured depository institution.
(C)Inclusion of shares held by the financial institution.—Any shares of the insured depository institution held by the foreign bank or any affiliate thereof as principal shall be included in the calculation of the number of shares in which the foreign bank or any affiliate thereof has a security interest for purposes of subparagraph (A).
(D)Report requirements.—
(i)Timing of report.—The report required under this paragraph shall be a consolidated report on behalf of the foreign bank and all affiliates thereof, and shall be filed in writing within 30 days of the date on which the foreign bank or affiliate thereof first believes that the security for any outstanding credit consists of 25 percent or more of any class of shares of an insured depository institution.
(ii)Content of report.—The report under this paragraph shall indicate the number and percentage of shares securing each applicable extension of credit, the identity of the borrower, and the number of shares held as principal by the foreign bank and any affiliate thereof.
(iii)Copy to other agencies.—A copy of any report under this paragraph shall be filed with the appropriate Federal banking agency for the foreign bank or any affiliate thereof (if other than the agency receiving the report under this paragraph).
(iv)Other information.—Each appropriate Federal banking agency may require any additional information necessary to carry out the agency’s supervisory responsibilities.
(E)Exceptions.—
(i)Exception where information provided by borrower.—Notwithstanding subparagraph (A), a foreign bank or any affiliate thereof shall not be required to report a transaction under this paragraph if the person or group of persons referred to in such subparagraph has disclosed the amount borrowed from such foreign bank or any affiliate thereof and the security interest of the foreign bank or any affiliate thereof to the appropriate Federal banking agency for the insured depository institution in connection with a notice filed under this subsection, an application filed under the Bank Holding Company Act of 1956 [12 U.S.C. 1841 et seq.], section 1467a of this title, or any other application filed with the appropriate Federal banking agency for the insured depository institution as a substitute for a notice under this subsection, such as an application for deposit insurance, membership in the Federal Reserve System, or a national bank charter.
(ii)Exception for shares owned for more than 1 year.—Notwithstanding subparagraph (A), a foreign bank and any affiliate thereof shall not be required to report a transaction involving—(I) a person or group of persons that has been the owner or owners of record of the stock for a period of 1 year or more; or(II) stock issued by a newly chartered bank before the bank’s opening.
(10) The reports required by paragraph (9) of this subsection shall contain such of the information referred to in paragraph (6) of this subsection, and such other relevant information, as the appropriate Federal banking agency may require by regulation or by specific request in connection with any particular report.
(11) The Federal banking agency receiving a notice or report filed pursuant to paragraph (1) or (9) shall immediately furnish to the other Federal banking agencies a copy of such notice or report.
(12) Whenever such a change in control occurs, each insured depository institution shall report promptly to the appropriate Federal banking agency any changes or replacement of its chief executive officer or of any director occurring in the next twelve-month period, including in its report a statement of the past and current business and professional affiliations of the new chief executive officer or directors.
(13) The appropriate Federal banking agencies are authorized to issue rules and regulations to carry out this subsection.
(14) Within two years after the effective date of the Change in Bank Control Act of 1978, and each year thereafter in each appropriate Federal banking agency’s annual report to the Congress, the appropriate Federal banking agency shall report to the Congress the results of the administration of this subsection, and make any recommendations as to changes in the law which in the opinion of the appropriate Federal banking agency would be desirable.
(15)Investigative and Enforcement Authority.—
(A)Investigations.—The appropriate Federal banking agency may exercise any authority vested in such agency under section 1818(n) of this title in the course of conducting any investigation under paragraph (2)(B) or any other investigation which the agency, in its discretion, determines is necessary to determine whether any person has filed inaccurate, incomplete, or misleading information under this subsection or otherwise is violating, has violated, or is about to violate any provision of this subsection or any regulation prescribed under this subsection.
(B)Enforcement.—Whenever it appears to the appropriate Federal banking agency that any person is violating, has violated, or is about to violate any provision of this subsection or any regulation prescribed under this subsection, the agency may, in its discretion, apply to the appropriate district court of the United States or the United States court of any territory for—
(i) a temporary or permanent injunction or restraining order enjoining such person from violating this subsection or any regulation prescribed under this subsection; or
(ii) such other equitable relief as may be necessary to prevent any such violation (including divestiture).
(C)Jurisdiction.—
(i) The district courts of the United States and the United States courts in any territory shall have the same jurisdiction and power in connection with any exercise of any authority by the appropriate Federal banking agency under subparagraph (A) as such courts have under section 1818(n) of this title.
(ii) The district courts of the United States and the United States courts of any territory shall have jurisdiction and power to issue any injunction or restraining order or grant any equitable relief described in subparagraph (B). When appropriate, any injunction, order, or other equitable relief granted under this paragraph shall be granted without requiring the posting of any bond.
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 August 9, 1989).
(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 1818(i)(2) of this title 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 1818(h) of this title shall apply to any proceeding under this paragraph.
(G)Disbursement.—All penalties collected under authority of this paragraph shall be deposited into the Treasury.
(17)Exceptions.—This subsection shall not apply with respect to a transaction which is subject to—
(A)section 1842 of this title;
(B)section 1828(c) of this title; or
(C)section 1467a of this title.
(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.
(k) Federal banking agency rules and regulations for reports and public disclosure by banks of extension of credit to executive officers or principal shareholders or the related interests of such persons
(l) Designation of fund membership for newly insured depository institutions; definitionsFor purposes of this section:
(1) Bank Insurance FundAny 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
(3) Transition provision
(A) Bank Insurance FundAny depository institution the deposits of which were insured by the Federal Deposit Insurance Corporation on the day before August 9, 1989, including—
(i) any Federal savings bank chartered pursuant to section 1464(o) of this title; and
(ii) any cooperative bank,
shall be a Bank Insurance Fund member as of August 9, 1989.
(B) Savings Association Insurance Fund
(4) Bank Insurance Fund member
(5) Savings Association Insurance Fund member
(6) Bank Insurance Fund reserve ratio
(7) Savings Association Insurance Fund reserve ratio
(m) Secondary reserve offsets against premiums
(1) Offsets in calendar years beginning before 1993
(2) Annual maximum amount limitation
(3) Offsets in calendar years beginning after 1992
(4) Transferability
(5) Pro rata distribution on termination of insured statusIf—
(A) the status of any savings association as an insured depository institution is terminated pursuant to any provision of section 1818 of this title or the insurance of accounts of any such 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” definedFor purposes of this subsection, the term “statutorily prescribed amount” means, with respect to any calendar year which ends after August 9, 1989—
(A) $823,705,000, minus
(B) the sum of—
(i) the aggregate amount of offsets made before August 9, 1989, by all insured institutions under section 404(e)(2) 1 of the National Housing Act [12 U.S.C. 1727(e)(2)] (as in effect before August 9, 1989); 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
(8) Year of enactment rule
(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) 1 of the National Housing Act [12 U.S.C. 1727(e)(2)] (as in effect before August 9, 1989) after the beginning of such calendar year and before August 9, 1989; 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) 1 of the National Housing Act (as in effect before August 9, 1989) after the beginning of such calendar year and before August 9, 1989; and
(ii) the change of such association’s premium year from the 1-year period applicable under section 404(b) 1 of the National Housing Act (as in effect before August 9, 1989) to a calendar year basis.
(n) Collections on behalf of the Comptroller of the Currency
(Sept. 21, 1950, ch. 967, § 2[7], 64 Stat. 876; Pub. L. 86–671, §§ 2, 3, July 14, 1960, 74 Stat. 547–551; Pub. L. 88–593, Sept. 12, 1964, 78 Stat. 940; Pub. L. 89–695, title II, § 201, title III, § 301(b), Oct. 16, 1966, 80 Stat. 1046, 1055; Pub. L. 91–151, § 7(a)(2), Dec. 23, 1969, 83 Stat. 375; Pub. L. 91–609, title IX, § 910(g), (h), Dec. 31, 1970, 84 Stat. 1812; Pub. L. 93–495, title I, §§ 101(a)(2), 102(a)(2), Oct. 28, 1974, 88 Stat. 1500, 1502; Pub. L. 95–369, § 6(c)(8)–(13), Sept. 17, 1978, 92 Stat. 617, 618; Pub. L. 95–630, title III, §§ 302, 310, title VI, § 602, title IX, § 901, Nov. 10, 1978, 92 Stat. 3676, 3678, 3683, 3693; Pub. L. 96–221, title III, § 308(a)(1)(B), (d), Mar. 31, 1980, 94 Stat. 147, 148; Pub. L. 97–110, title I, § 103(b), Dec. 26, 1981, 95 Stat. 1514; Pub. L. 97–320, title I, §§ 113(d)–(f), (q), 117, title IV, § 429, Oct. 15, 1982, 96 Stat. 1473, 1475, 1479, 1527; Pub. L. 99–570, title I, § 1360, Oct. 27, 1986, 100 Stat. 3207–29; Pub. L. 100–86, title V, § 505(a), Aug. 10, 1987, 101 Stat. 633; Pub. L. 101–73, title II, §§ 201, 208, title IX, §§ 905(c), 907(d), 911(c), 931(a), Aug. 9, 1989, 103 Stat. 187, 206, 460, 468, 479, 493; Pub. L. 101–508, title II, §§ 2002–2004, Nov. 5, 1990, 104 Stat. 1388–14—1388–16; Pub. L. 102–242, title I, §§ 103(b), 104, 113(c)(1), 141(c), title II, §§ 205, 232(b), 233(c), title III, §§ 302(a), (b), (e)(3), (4), formerly (e)(2), (3), 311(a)(2), (b)(3), 313(a), title IV, § 474, Dec. 19, 1991, 105 Stat. 2238, 2247, 2277, 2292, 2310, 2314, 2345, 2348, 2349, 2363, 2365, 2368, 2386; Pub. L. 102–550, title IX, § 931(a), (b), title XVI, §§ 1603(a)(1), (3), 1604(b)(1), (3), 1605(a)(2), (5)(A), (6), (b)(1), (2), 1606(i)(1), Oct. 28, 1992, 106 Stat. 3888, 4078, 4083, 4085–4087, 4089; Pub. L. 102–558, title III, §§ 303(a), (b)(1), (3), (6)(A), (7), (8), 305, Oct. 28, 1992, 106 Stat. 4224–4226; Pub. L. 103–204, §§ 8(h), 38(a), Dec. 17, 1993, 107 Stat. 2388, 2416; Pub. L. 103–325, title III, §§ 305(b), 308(b), 348, title VI, § 602(a)(4)–(10), Sept. 23, 1994, 108 Stat. 2217, 2218, 2241, 2288; Pub. L. 104–208, div. A, title II, §§ 2226, 2703(b), 2704(d)(6)(B), (14)(G), 2706–2708, Sept. 30, 1996, 110 Stat. 3009–417, 3009–485, 3009–488, 3009–491, 3009–496, 3009–497; Pub. L. 106–569, title XII, § 1231(a), Dec. 27, 2000, 114 Stat. 3036; Pub. L. 108–386, § 8(a)(2), Oct. 30, 2004, 118 Stat. 2231; Pub. L. 109–171, title II, §§ 2102(b), 2104(a), (b), (d), 2105(a), 2106, 2107(a), 2108, Feb. 8, 2006, 120 Stat. 9, 12–16, 19; Pub. L. 109–173, §§ 2(b), 3(a)(1)–(5), 8(a)(8), (9), Feb. 15, 2006, 119 Stat. 3602, 3605, 3611; Pub. L. 109–351, title VI, § 604, title VII, §§ 705, 707(a), Oct. 13, 2006, 120 Stat. 1980, 1987; Pub. L. 111–22, div. A, title II, § 204(b), May 20, 2009, 123 Stat. 1649; Pub. L. 111–203, title III, §§ 331(a), 332–334(a), 363(2), title IX, § 939(a)(1), July 21, 2010, 124 Stat. 1538, 1539, 1550, 1885; Pub. L. 115–174, title II, § 205, May 24, 2018, 132 Stat. 1310.)

CITE AS: 12 USC 1817

§ 1818. Termination of status as insured depository institution
(a) Termination of insurance
(1) Voluntary terminationAny insured depository institution which is not—
(A) a national member bank;
(B) a State member bank;
(C) a Federal branch;
(D) a Federal savings association; or
(E) an insured branch which is required to be insured under subsection (a) or (b) 1
1 See References in Text note below.
of section 3104 of this title,
may terminate such depository institution’s status as an insured depository institution if such insured institution provides written notice to the Corporation of the institution’s intent to terminate such status not less than 90 days before the effective date of such termination.
(2) Involuntary termination
(A) Notice to primary regulatorIf the Board of Directors determines that—
(i) an insured depository institution or the directors or trustees of an insured depository institution have engaged or are engaging in unsafe or unsound practices in conducting the business of the depository institution;
(ii) an insured depository institution is in an unsafe or unsound condition to continue operations as an insured institution; or
(iii) an insured depository institution or the directors or trustees of the insured institution have violated any applicable law, regulation, order, condition imposed in writing by the Corporation in connection with the approval of any application or other request by the insured depository institution, or written agreement entered into between the insured depository institution and the Corporation,
the Board of Directors shall notify the appropriate Federal banking agency with respect to such institution (if other than the Corporation) or the State banking supervisor of such institution (if the Corporation is the appropriate Federal banking agency) of the Board’s determination and the facts and circumstances on which such determination is based for the purpose of securing the correction of such practice, condition, or violation. Such notice shall be given to the appropriate Federal banking agency not less than 30 days before the notice required by subparagraph (B), except that this period for notice to the appropriate Federal banking agency may be reduced or eliminated with the agreement of such agency.
(B) Notice of intention to terminate insuranceIf, after giving the notice required under subparagraph (A) with respect to an insured depository institution, the Board of Directors determines that any unsafe or unsound practice or condition or any violation specified in such notice requires the termination of the insured status of the insured depository institution, the Board shall—
(i) serve written notice to the insured depository institution of the Board’s intention to terminate the insured status of the institution;
(ii) provide the insured depository institution with a statement of the charges on the basis of which the determination to terminate such institution’s insured status was made (or a copy of the notice under subparagraph (A)); and
(iii) notify the insured depository institution of the date (not less than 30 days after notice under this subparagraph) and place for a hearing before the Board of Directors (or any person designated by the Board) with respect to the termination of the institution’s insured status.
(3) Hearing; termination
(4) Appearance; consent to termination
(5) Judicial review
(6) Publication of notice of termination
(7) Temporary insurance of deposits insured as of termination
(8) Temporary suspension of insurance
(A) In general
(B) Special rule for certain savings institutions
(i) Certain goodwill included in tangible capital
(ii) Suspension orderThe Corporation may issue a temporary order suspending deposit insurance on all deposits received by a special supervisory association whenever the Board of Directors determines that—(I) the capital of such association, as computed utilizing applicable accounting standards, has suffered a material decline;(II) that such association (or its directors or officers) is engaging in an unsafe or unsound practice in conducting the business of the association;(III) that such association is in an unsafe or unsound condition to continue operating as an insured association; or(IV) that such association (or its directors or officers) has violated any applicable law, rule, regulation, or order, or any condition imposed in writing by a Federal banking agency, or any written agreement including a capital improvement plan entered into with any Federal banking agency, or that the association has failed to enter into a capital improvement plan which is acceptable to the Corporation within the time period set forth in section 1464(t) of this title.
 Nothing in this paragraph limits the right of the Corporation or the Comptroller of the Currency to enforce a contractual provision which authorizes the Corporation or the Comptroller of the Currency, as a successor to the Federal Savings and Loan Insurance Corporation or the Federal Home Loan Bank Board, to require a savings association to write down or amortize goodwill at a faster rate than otherwise required under this chapter or under applicable accounting standards.
(C) Effective period of temporary order
(D) Judicial review
(E) Continuation of insurance for prior deposits
(F) Publication of order
(G) Notice by Corporation
(H) Lack of noticeNotwithstanding subparagraph (A), any deposit made after the effective date of a suspension order issued under this paragraph shall remain insured to the extent that the depositor establishes that—
(i) such deposit consists of additions made by automatic deposit the depositor was unable to prevent; or
(ii) such depositor did not have actual knowledge of the suspension of insurance.
(9) Final decisions to terminate insuranceAny decision by the Board of Directors to—
(A) issue a temporary order terminating deposit insurance; or
(B) issue a final order terminating deposit insurance (other than under subsection (p) or (q));
shall be made by the Board of Directors and may not be delegated.
(10) Low- to moderate-income housing lender
(b) Cease-and-desist proceedings
(1) If, in the opinion of the appropriate Federal banking agency, any insured depository institution, depository institution which has insured deposits, or any institution-affiliated party is engaging or has engaged, or the agency has reasonable cause to believe that the depository institution or any institution-affiliated party is about to engage, in an unsafe or unsound practice in conducting the business of such depository institution, or is violating or has violated, or the agency has reasonable cause to believe that the depository institution or any institution-affiliated party is about to violate, a law, rule, or regulation, or any condition imposed in writing by a Federal banking agency in connection with any action on any application, notice, or other request by the depository institution or institution-affiliated party, or any written agreement entered into with the agency, the appropriate Federal banking agency for the depository institution may issue and serve upon the depository institution or such party a notice of charges in respect thereof. The notice shall contain a statement of the facts constituting the alleged violation or violations or the unsafe or unsound practice or practices, and shall fix a time and place at which a hearing will be held to determine whether an order to cease and desist therefrom should issue against the depository institution or the institution-affiliated party. Such hearing shall be fixed for a date not earlier than thirty days nor later than sixty days after service of such notice unless an earlier or a later date is set by the agency at the request of any party so served. Unless the party or parties so served shall appear at the hearing personally or by a duly authorized representative, they shall be deemed to have consented to the issuance of the cease-and-desist order. In the event of such consent, or if upon the record made at any such hearing, the agency shall find that any violation or unsafe or unsound practice specified in the notice of charges has been established, the agency may issue and serve upon the depository institution or the institution-affiliated party an order to cease and desist from any such violation or practice. Such order may, by provisions which may be mandatory or otherwise, require the depository institution or its institution-affiliated parties to cease and desist from the same, and, further, to take affirmative action to correct the conditions resulting from any such violation or practice.
(2) A cease-and-desist order shall become effective at the expiration of thirty days after the service of such order upon the depository institution or other person concerned (except in the case of a cease-and-desist order issued upon consent, which shall become effective at the time specified therein), and shall remain effective and enforceable as provided therein, except to such extent as it is stayed, modified, terminated, or set aside by action of the agency or a reviewing court.
(3) This subsection, subsections (c) through (s) and subsection (u) of this section, and section 1831aa of this title shall apply to any bank holding company, and to any subsidiary (other than a bank) of a bank holding company, as those terms are defined in the Bank Holding Company Act of 1956 [12 U.S.C. 1841 et seq.], any savings and loan holding company and any subsidiary (other than a depository institution) of a savings and loan holding company (as such terms are defined in section 1467a of this title)),2
2 So in original. The second closing parenthesis probably should not appear.
any noninsured State member bank and to any organization organized and operated under section 25(a) 1 of the Federal Reserve Act [12 U.S.C. 611 et seq.] or operating under section 25 of the Federal Reserve Act [12 U.S.C. 601 et seq.], in the same manner as they apply to a State member insured bank. Nothing in this subsection or in subsection (c) of this section shall authorize any Federal banking agency, other than the Board of Governors of the Federal Reserve System, to issue a notice of charges or cease-and-desist order against a bank holding company or any subsidiary thereof (other than a bank or subsidiary of that bank) or against a savings and loan holding company or any subsidiary thereof (other than a depository institution or a subsidiary of such depository institution).
(4) This subsection, subsections (c) through (s) and subsection (u) of this section, and section 1831aa of this title shall apply to any foreign bank or company to which subsection (a) of section 3106 of this title applies and to any subsidiary (other than a bank) of any such foreign bank or company in the same manner as they apply to a bank holding company and any subsidiary thereof (other than a bank) under paragraph (3) of this subsection. For the purposes of this paragraph, the term “subsidiary” shall have the meaning assigned to it in section 2 of the Bank Holding Company Act of 1956 [12 U.S.C. 1841].
(5) This section shall apply, in the same manner as it applies to any insured depository institution for which the appropriate Federal banking agency is the Comptroller of the Currency, to any national banking association chartered by the Comptroller of the Currency, including an uninsured association.
(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 or remedy 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)Unsatisfactory asset quality, management, earnings, or liquidity as unsafe or unsound practice.—If an insured depository institution receives, in its most recent report of examination, a less-than-satisfactory rating for asset quality, management, earnings, or liquidity, the appropriate Federal banking agency may (if the deficiency is not corrected) deem the institution to be engaging in an unsafe or unsound practice for purposes of this subsection.
(9)
(10)Standard for certain orders.—No authority under this subsection or subsection (c) to prohibit any institution-affiliated party from withdrawing, transferring, removing, dissipating, or disposing of any funds, assets, or other property may be exercised unless the appropriate Federal banking agency meets the standards of Rule 65 of the Federal Rules of Civil Procedure, without regard to the requirement of such rule that the applicant show that the injury, loss, or damage is irreparable and immediate.
(c) Temporary cease-and-desist orders
(1) Whenever the appropriate Federal banking agency shall determine that the violation or threatened violation or the unsafe or unsound practice or practices, specified in the notice of charges served upon the depository institution or any institution-affiliated party pursuant to paragraph (1) of subsection (b) of this section, or the continuation thereof, is likely to cause insolvency or significant dissipation of assets or earnings of the depository institution, or is likely to weaken the condition of the depository institution or otherwise prejudice the interests of its depositors prior to the completion of the proceedings conducted pursuant to paragraph (1) of subsection (b) of this section, the agency may issue a temporary order requiring the depository institution or such party to cease and desist from any such violation or practice and to take affirmative action to prevent or remedy such insolvency, dissipation, condition, or prejudice pending completion of such proceedings. Such order may include any requirement authorized under subsection (b)(6). Such order shall become effective upon service upon the depository institution or such institution-affiliated party and, unless set aside, limited, or suspended by a court in proceedings authorized by paragraph (2) of this subsection, shall remain effective and enforceable pending the completion of the administrative proceedings pursuant to such notice and until such time as the agency shall dismiss the charges specified in such notice, or if a cease-and-desist order is issued against the depository institution or such party, until the effective date of such order.
(2) Within ten days after the depository institution concerned or any institution-affiliated party has been served with a temporary cease-and-desist order, the depository institution or such party may apply to the United States district court for the judicial district in which the home office of the depository institution is located, or the United States District Court for the District of Columbia, for an injunction setting aside, limiting, or suspending the enforcement, operation, or effectiveness of such order pending the completion of the administrative proceedings pursuant to the notice of charges served upon the depository institution or such party under paragraph (1) of subsection (b) of this section, and such court shall have jurisdiction to issue such injunction.
(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.
(4)False advertising or misuse of names to indicate insured status.—
(A)Temporary order.—
(i)In general.—If a notice of charges served under subsection (b)(1) specifies on the basis of particular facts that any person engaged or is engaging in conduct described in section 1828(a)(4) of this title, the Corporation or other appropriate Federal banking agency may issue a temporary order requiring—(I) the immediate cessation of any activity or practice described, which gave rise to the notice of charges; and(II) affirmative action to prevent any further, or to remedy any existing, violation.
(ii)Effect of order.—Any temporary order issued under this subparagraph shall take effect upon service.
(B)Effective period of temporary order.—A temporary order issued under subparagraph (A) shall remain effective and enforceable, pending the completion of an administrative proceeding pursuant to subsection (b)(1) in connection with the notice of charges—
(i) until such time as the Corporation or other appropriate Federal banking agency dismisses the charges specified in such notice; or
(ii) if a cease-and-desist order is issued against such person, until the effective date of such order.
(C)Civil money penalties.—Any violation of section 1828(a)(4) of this title shall be subject to civil money penalties, as set forth in subsection (i), except that for any person other than an insured depository institution or an institution-affiliated party that is found to have violated this paragraph, the Corporation or other appropriate Federal banking agency shall not be required to demonstrate any loss to an insured depository institution.
(d) Temporary cease-and-desist orders; enforcement
(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 a Federal banking agency in connection with any action on any application, notice, or request by such depository institution or institution-affiliated party; 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 appropriate Federal banking agency for the depository institution 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)Specific violations.—
(A)In general.—Whenever the appropriate Federal banking agency determines that—
(i) an institution-affiliated party has committed a violation of any provision of subchapter II of chapter 53 of title 31 and such violation was not inadvertent or unintentional;
(ii) an officer or director of an insured depository institution has knowledge that an institution-affiliated party of the insured depository institution has violated any such provision or any provision of law referred to in subsection (g)(1)(A)(ii);
(iii) an officer or director of an insured depository institution has committed any violation of the Depository Institution Management Interlocks Act [12 U.S.C. 3201 et seq.]; or
(iv) an institution-affiliated party of a subsidiary (other than a bank) of a bank holding company or of a subsidiary (other than a savings association) of a savings and loan holding company has been convicted of any criminal offense involving dishonesty or a breach of trust or a criminal offense under section 1956, 1957, or 1960 of title 18 or has agreed to enter into a pretrial diversion or similar program in connection with a prosecution for such an offense,
the agency may serve upon such party, officer, or director a written notice of the agency’s intention to remove such party from office.
(B)Factors to be considered.—In determining whether an officer or director should be removed as a result of the application of subparagraph (A)(ii), the agency shall consider whether the officer or director took appropriate action to stop, or to prevent the recurrence of, a violation described in such subparagraph.
(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.
(4) A notice of intention to remove an institution-affiliated party from office or to prohibit such party from participating in the conduct of the affairs of an insured depository institution, shall contain a statement of the facts constituting grounds therefor, and shall fix a time and place at which a hearing will be held thereon. Such hearing shall be fixed for a date not earlier than thirty days nor later than sixty days after the date of service of such notice, unless an earlier or a later date is set by the agency at the request of (A) such party, and for good cause shown, or (B) the Attorney General of the United States. Unless such party shall appear at the hearing in person or by a duly authorized representative, such party shall be deemed to have consented to the issuance of an order of such removal or prohibition. In the event of such consent, or if upon the record made at any such hearing the agency shall find that any of the grounds specified in such notice have been established, the agency may issue such orders of suspension or removal from office, or prohibition from participation in the conduct of the affairs of the depository institution, as it may deem appropriate. Any such order shall become effective at the expiration of thirty days after service upon such depository institution and such party concerned (except in the case of an order issued upon consent, which shall become effective at the time specified therein). Such order shall remain effective and enforceable except to such extent as it is stayed, modified, terminated, or set aside by action of the agency or a reviewing court.
(5) For the purpose of enforcing any law, rule, regulation, or cease-and-desist order in connection with an interlocking relationship, the term “officer” within the term “institution-affiliated party” as used in this subsection means an employee or officer with management functions, and the term “director” within the term “institution-affiliated party” as used in this subsection includes an advisory or honorary director, a trustee of a depository institution under the control of trustees, or any person who has a representative or nominee serving in any such capacity.
(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.
(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)(9); 1
(iii) any insured credit union under the Federal Credit Union Act [12 U.S.C. 1751 et seq.];
(iv) any institution chartered under the Farm Credit Act of 1971 [12 U.S.C. 2001 et seq.];
(v) any appropriate Federal depository institution regulatory agency; and
(vi) the Federal Housing Finance Agency and any Federal home loan bank.
(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 [12 U.S.C. 2001 et seq.];
(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 [12 U.S.C. 1752(7)]); and
(iv) the Secretary of the Treasury, in the case of the Federal Housing Finance Agency and any Federal home loan bank.
(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.
(f) Stay of suspension and/or prohibition of institution-affiliated party
(g) Suspension, removal, and prohibition from participation orders in the case of certain criminal offenses
(1)Suspension or prohibition.—
(A)In general.—Whenever any institution-affiliated party is the subject of any information, indictment, or complaint, involving the commission of or participation in—
(i) a crime involving dishonesty or breach of trust which is punishable by imprisonment for a term exceeding one year under State or Federal law, or
(ii) a criminal violation of section 1956, 1957, or 1960 of title 18 or section 5322 or 5324 of title 31,
the appropriate Federal banking agency may, if continued service or participation by such party posed, poses, or may pose a threat to the interests of the depositors of, or threatened, threatens, or may threaten to impair public confidence in, any relevant depository institution (as defined in subparagraph (E)), by written notice served upon such party, suspend such party from office or prohibit such party from further participation in any manner in the conduct of the affairs of any depository institution.
(B)Provisions applicable to notice.—
(i)Copy.—A copy of any notice under subparagraph (A) shall also be served upon any depository institution that the subject of the notice is affiliated with at the time the notice is issued.
(ii)Effective period.—A suspension or prohibition under subparagraph (A) shall remain in effect until the information, indictment, or complaint referred to in such subparagraph is finally disposed of or until terminated by the agency.
(C)Removal or prohibition.—
(i)In general.—If a judgment of conviction or an agreement to enter a pretrial diversion or other similar program is entered against an institution-affiliated party in connection with a crime described in subparagraph (A)(i), at such time as such judgment is not subject to further appellate review, the appropriate Federal banking agency may, if continued service or participation by such party posed, poses, or may pose a threat to the interests of the depositors of, or threatened, threatens, or may threaten to impair public confidence in, any relevant depository institution (as defined in subparagraph (E)), issue and serve upon such party an order removing such party from office or prohibiting such party from further participation in any manner in the conduct of the affairs of any depository institution without the prior written consent of the appropriate agency.
(ii)Required for certain offenses.—In the case of a judgment of conviction or agreement against an institution-affiliated party in connection with a violation described in subparagraph (A)(ii), the appropriate Federal banking agency shall issue and serve upon such party an order removing such party from office or prohibiting such party from further participation in any manner in the conduct of the affairs of any depository institution without the prior written consent of the appropriate agency.
(D)Provisions applicable to order.—
(i)Copy.—A copy of any order under subparagraph (C) shall also be served upon any depository institution that the subject of the order is affiliated with at the time the order is issued, whereupon the institution-affiliated party who is subject to the order (if a director or an officer) shall cease to be a director or officer of such depository institution.
(ii)Effect of acquittal.—A finding of not guilty or other disposition of the charge shall not preclude the agency from instituting proceedings after such finding or disposition to remove such party from office or to prohibit further participation in depository institution affairs, pursuant to paragraph (1), (2), or (3) of subsection (e) of this section.
(iii)Effective period.—Any notice of suspension or order of removal issued under this paragraph shall remain effective and outstanding until the completion of any hearing or appeal authorized under paragraph (3) unless terminated by the agency.
(E)Relevant depository institution.—For purposes of this subsection, the term “relevant depository institution” means any depository institution of which the party is or was an institution-affiliated party at the time at which—
(i) the information, indictment, or complaint described in subparagraph (A) was issued; or
(ii) the notice is issued under subparagraph (A) or the order is issued under subparagraph (C)(i).
(2) If at any time, because of the suspension of one or more directors pursuant to this section, there shall be on the board of directors of a national bank less than a quorum of directors not so suspended, all powers and functions vested in or exercisable by such board shall vest in and be exercisable by the director or directors on the board not so suspended, until such time as there shall be a quorum of the board of directors. In the event all of the directors of a national bank are suspended pursuant to this section, the Comptroller of the Currency shall appoint persons to serve temporarily as directors in their place and stead pending the termination of such suspensions, or until such time as those who have been suspended, cease to be directors of the bank and their respective successors take office.
(3) Within thirty days from service of any notice of suspension or order of removal issued pursuant to paragraph (1) of this subsection, the institution-affiliated party concerned may request in writing an opportunity to appear before the agency to show that the continued service to or participation in the conduct of the affairs of the depository institution by such party does not, or is not likely to, pose a threat to the interests of the bank’s 3
3 So in original. Probably should be “depository institution’s”.
depositors or threaten to impair public confidence in the depository institution. Upon receipt of any such request, the appropriate Federal banking agency shall fix a time (not more than thirty days after receipt of such request, unless extended at the request of such party) and place at which such party may appear, personally or through counsel, before one or more members of the agency or designated employees of the agency to submit written materials (or, at the discretion of the agency, oral testimony) and oral argument. Within sixty days of such hearing, the agency shall notify such party whether the suspension or prohibition from participation in any manner in the conduct of the affairs of the depository institution will be continued, terminated, or otherwise modified, or whether the order removing such party from office or prohibiting such party from further participation in any manner in the conduct of the affairs of the depository institution will be rescinded or otherwise modified. Such notification shall contain a statement of the basis for the agency’s decision, if adverse to such party. The Federal banking agencies are authorized to prescribe such rules as may be necessary to effectuate the purposes of this subsection.
(h) Hearings and judicial review
(1) Any hearing provided for in this section (other than the hearing provided for in subsection (g)(3) of this section) shall be held in the Federal judicial district or in the territory in which the home office of the depository institution 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. After such hearing, and within ninety days after the appropriate Federal banking agency or Board of Governors of the Federal Reserve System has notified the parties that the case has been submitted to it for final decision, it shall render its decision (which shall include findings of fact upon which its decision is predicated) and shall issue and serve upon each party to the proceeding an order or orders consistent with the provisions of this section. Judicial review of any such order shall be exclusively as provided in this subsection (h). Unless a petition for review is timely filed in a court of appeals of the United States, as hereinafter provided in paragraph (2) of this subsection, and thereafter until the record in the proceeding has been filed as so provided, the issuing agency may at any time, upon such notice and in such manner as it shall deem proper, modify, terminate, or set aside any such order. Upon such filing of the record, the agency may modify, terminate, or set aside any such order with permission of the court.
(2) Any party to any proceeding under paragraph (1) may obtain a review of any order served pursuant to paragraph (1) of this subsection (other than an order issued with the consent of the depository institution or the institution-affiliated party concerned, or an order issued under paragraph (1) of subsection (g) of this section) by the filing in the court of appeals of the United States for the circuit in which the home office of the depository institution is located, or in the United States Court of Appeals for the District of Columbia Circuit, within thirty days after the date of service of such order, a written petition praying that the order of the agency be modified, terminated, or set aside. A copy of such petition shall be forthwith transmitted by the clerk of the court to the agency, and thereupon the agency shall file in the court the record in the proceeding, as provided in section 2112 of title 28. Upon the filing of such petition, such court shall have jurisdiction, which upon the filing of the record shall except as provided in the last sentence of said paragraph (1) be exclusive, to affirm, modify, terminate, or set aside, in whole or in part, the order of the agency. Review of such proceedings shall be had as provided in chapter 7 of title 5. 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.
(3) The commencement of proceedings for judicial review under paragraph (2) of this subsection shall not, unless specifically ordered by the court, operate as a stay of any order issued by the agency.
(i) Jurisdiction and enforcement; penalty
(1) The appropriate Federal banking agency may in its discretion apply to the United States district court, or the United States court of any territory, within the jurisdiction of which the home office of the depository institution is located, for the enforcement of any effective and outstanding notice or order issued under this section or under section 1831o or 1831p–1 of this title, and such courts shall have jurisdiction and power to order and require compliance herewith; but except as otherwise provided in this section or under section 1831o or 1831p–1 of this title no court shall have jurisdiction to affect by injunction or otherwise the issuance or enforcement of any notice or order under any such section, or to review, modify, suspend, terminate, or set aside any such notice or order.
(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) or any final order under section 1831o or 1831p–1 of this title;
(iii) violates any condition imposed in writing by a Federal banking agency in connection with any action on any application, notice, or other request by the depository institution or institution-affiliated party; 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.
(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 depository institution) shall not affect the jurisdiction and authority of the appropriate Federal banking agency to issue any notice or order and proceed under this section against any such party, if such notice or order 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 August 9, 1989).
(4)Prejudgment attachment.—
(A)In general.—In any action brought by an appropriate Federal banking agency (excluding the Corporation when acting in a manner described in section 1821(d)(18) of this title) pursuant to this section, or in actions brought in aid of, or to enforce an order in, any administrative or other civil action for money damages, restitution, or civil money penalties brought by such agency, the court may, upon application of the agency, issue a restraining order that—
(i) prohibits any person subject to the proceeding from withdrawing, transferring, removing, dissipating, or disposing of any funds, assets or other property; and
(ii) appoints a temporary receiver to administer the restraining order.
(B)Standard.—
(i)Showing.—Rule 65 of the Federal Rules of Civil Procedure shall apply with respect to any proceeding under subparagraph (A) without regard to the requirement of such rule that the applicant show that the injury, loss, or damage is irreparable and immediate.
(ii)State proceeding.—If, in the case of any proceeding in a State court, the court determines that rules of civil procedure available under the laws of such State provide substantially similar protections to a party’s right to due process as Rule 65 (as modified with respect to such proceeding by clause (i)), the relief sought under subparagraph (A) may be requested under the laws of such State.
(j) Criminal penaltyWhoever, 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);
(3) any insured credit union (as defined in section 101(7) of the Federal Credit Union Act [12 U.S.C. 1752(7)]); or
(4) any institution chartered under the Farm Credit Act of 1971 [12 U.S.C. 2001 et seq.],
shall be fined not more than $1,000,000, imprisoned for not more than 5 years, or both.
(k) Repealed. Pub. L. 101–73, title IX, § 920(c), Aug. 9, 1989, 103 Stat. 488
(l) Notice of service
(m) Notice to State authorities
(n) Ancillary provisions; subpena power, etc.
(o) Termination of membership of State bank in Federal Reserve System
(p) Banks not receiving deposits
(q) Assumption of liabilities
(r) Action or proceeding against foreign bank; basis; removal of officer or other person; venue; service of process
(1) Except as otherwise specifically provided in this section, the provisions of this section shall be applied to foreign banks in accordance with this subsection.
(2) An act or practice outside the United States on the part of a foreign bank or any officer, director, employee, or agent thereof may not constitute the basis for any action by any officer or agency of the United States under this section, unless—
(A) such officer or agency alleges a belief that such act or practice has been, is, or is likely to be a cause of or carried on in connection with or in furtherance of an act or practice within any one or more States which, in and of itself, would constitute an appropriate basis for action by a Federal officer or agency under this section; or
(B) the alleged act or practice is one which, if proven, would, in the judgment of the Board of Directors, adversely affect the insurance risk assumed by the Corporation.
(3) In any case in which any action or proceeding is brought pursuant to an allegation under paragraph (2) of this subsection for the suspension or removal of any officer, director, or other person associated with a foreign bank, and such person fails to appear promptly as a party to such action or proceeding and to comply with any effective order or judgment therein, any failure by the foreign bank to secure his removal from any office he holds in such bank and from any further participation in its affairs shall, in and of itself, constitute grounds for termination of the insurance of the deposits in any branch of the bank.
(4) Where the venue of any judicial or administrative proceeding under this section is to be determined by reference to the location of the home office of a bank, the venue of such a proceeding with respect to a foreign bank having one or more branches or agencies in not more than one judicial district or other relevant jurisdiction shall be within such jurisdiction. Where such a bank has branches or agencies in more than one such jurisdiction, the venue shall be in the jurisdiction within which the branch or branches or agency or agencies involved in the proceeding are located, and if there is more than one such jurisdiction, the venue shall be proper in any such jurisdiction in which the proceeding is brought or to which it may appropriately be transferred.
(5) Any service required or authorized to be made on a foreign bank may be made on any branch or agency located within any State, but if such service is in connection with an action or proceeding involving one or more branches or one or more agencies located in any State, service shall be made on at least one branch or agency so involved.
(s) Compliance with monetary transaction recordkeeping and report requirements
(1) Compliance procedures required
(2) Examinations of depository institution to include review of compliance procedures
(A) In general
(B) Exam report requirement
(3) Order to comply with requirementsIf the appropriate Federal banking agency determines that an insured depository institution—
(A) has failed to establish and maintain the procedures described in paragraph (1); or
(B) has failed to correct any problem with the procedures maintained by such depository institution which was previously reported to the depository institution by such agency,
(t) Authority of FDIC to take enforcement action against insured depository institutions and institution-affiliated parties
(1) Recommending action by appropriate Federal banking agency
(2) FDIC’s authority to act if appropriate Federal banking agency fails to follow recommendationIf the appropriate Federal banking agency does not, before the end of the 60-day period beginning on the date on which the agency receives the recommendation under paragraph (1), take the enforcement action recommended by the Corporation or provide a plan acceptable to the Corporation for responding to the Corporation’s concerns, the Corporation may take the recommended enforcement action if the Board of Directors determines, upon a vote of its members, that—
(A) the insured depository institution is in an unsafe or unsound condition;
(B) the institution or institution-affiliated party is engaging in unsafe or unsound practices, and the recommended enforcement action will prevent the institution or institution-affiliated party from continuing such practices;
(C) the conduct or threatened conduct (including any acts or omissions) poses a risk to the Deposit Insurance Fund, or may prejudice the interests of the institution’s depositors or 4
4 So in original. Probably should be “; or”.
(D) the conduct or threatened conduct (including any acts or omissions) of the depository institution holding company poses a risk to the Deposit Insurance Fund, provided that such authority may not be used with respect to a depository institution holding company that is in generally sound condition and whose conduct does not pose a foreseeable and material risk of loss to the Deposit Insurance Fund; 5
5 So in original. The semicolon probably should be a period.
(3) Effect of exigent circumstances
(A) Authority to act
(B) Agreement on exigent circumstances
(4) Corporation’s powers; institution’s dutiesFor purposes of this subsection—
(A) the Corporation shall have the same powers with respect to any insured depository institution and its affiliates as the appropriate Federal banking agency has with respect to the institution and its affiliates; and
(B) the institution and its affiliates shall have the same duties and obligations with respect to the Corporation as the institution and its affiliates have with respect to the appropriate Federal banking agency.
(5) Requests for formal actions and investigations
(A) Submission of requests
(B) Agencies required to report on requests
(6)6
6 So in original. Two pars. (6) have been enacted.
Powers and duties with respect to depository institution holding companiesFor purposes of exercising the backup authority provided in this subsection—
(A) the Corporation shall have the same powers with respect to a depository institution holding company and its affiliates as the appropriate Federal banking agency has with respect to the holding company and its affiliates; and
(B) the holding company and its affiliates shall have the same duties and obligations with respect to the Corporation as the holding company and its affiliates have with respect to the appropriate Federal banking agency.
(6)6 Referral to Bureau of Consumer Financial Protection
(u) Public disclosures of final orders and agreements
(1) In generalThe appropriate Federal banking agency shall publish and make available to the public on a monthly basis—
(A) any written agreement or other written statement for which a violation may be enforced by the appropriate Federal banking agency, unless the appropriate Federal banking agency, in its discretion, determines that publication would be contrary to the public interest;
(B) any final order issued with respect to any administrative enforcement proceeding initiated by such agency under this section or any other law; and
(C) any modification to or termination of any order or agreement made public pursuant to this paragraph.
(2) Hearings
(3) Transcript of hearing
(4) Delay of publication under exceptional circumstances
(5) Documents filed under seal in public enforcement hearings
(6) Retention of documents
(7) Disclosures to Congress
(v) Foreign investigations
(1) Requesting assistance from foreign banking authoritiesIn conducting any investigation, examination, or enforcement action under this chapter, the appropriate Federal banking agency may—
(A) request the assistance of any foreign banking authority; and
(B) maintain an office outside the United States.
(2) Providing assistance to foreign banking authorities
(A) In general
(B) Investigation by Federal banking agency
(C) Factors to considerIn deciding whether to provide assistance under this paragraph, the appropriate Federal banking agency shall consider—
(i) whether the requesting authority has agreed to provide reciprocal assistance with respect to banking matters within the jurisdiction of any appropriate Federal banking agency; and
(ii) whether compliance with the request would prejudice the public interest of the United States.
(D) Treatment of foreign banking authority
(3) Rule of construction
(w) Termination of insurance for money laundering or cash transaction reporting offenses
(1) In general
(A) Conviction of title 18 offenses
(i) Duty to notify
(ii) Notice of termination; pretermination hearing
(B) Conviction of title 31 offenses
(C) Notice to State supervisor
(2) Factors to be consideredIn determining whether to terminate insurance under paragraph (1), the Board of Directors shall take into account the following factors:
(A) The extent to which directors or senior executive officers of the depository institution knew of, or were involved in, the commission of the money laundering offense of which the institution was found guilty.
(B) The extent to which the offense occurred despite the existence of policies and procedures within the depository institution which were designed to prevent the occurrence of any such offense.
(C) The extent to which the depository institution has fully cooperated with law enforcement authorities with respect to the investigation of the money laundering offense of which the institution was found guilty.
(D) The extent to which the depository institution has implemented additional internal controls (since the commission of the offense of which the depository institution was found guilty) to prevent the occurrence of any other money laundering offense.
(E) The extent to which the interest of the local community in having adequate deposit and credit services available would be threatened by the termination of insurance.
(3) Notice to State banking supervisor and publicWhen the order to terminate insured status initiated pursuant to this subsection is final, the Board of Directors shall—
(A) notify the State banking supervisor of any State depository institution described in paragraph (1), where appropriate, at least 10 days prior to the effective date of the order of termination of the insured status of such depository institution, including a State branch of a foreign bank; and
(B) publish notice of the termination of the insured status of the depository institution in the Federal Register.
(4) Temporary insurance of previously insured deposits
(5) Successor liability
(6) “Senior executive officer” defined
(Sept. 21, 1950, ch. 967, § 2[8], 64 Stat. 879; Pub. L. 89–695, title II, §§ 202, 204, Oct. 16, 1966, 80 Stat. 1046, 1054; Pub. L. 93–495, title I, § 110, Oct. 28, 1974, 88 Stat. 1506; Pub. L. 95–369, §§ 6(c)(14), (15), 11, Sept. 17, 1978, 92 Stat. 618, 624; Pub. L. 95–630, title I, §§ 107(a)(1), (b), (c)(1), (d)(1), (e)(1), 111(a), title II, § 208(a), title III, §§ 303, 304, Nov. 10, 1978, 92 Stat. 3649, 3653, 3654, 3656, 3660, 3665, 3674, 3676; Pub. L. 97–320, title I, § 113(g), (h), title IV, §§ 404(c), 424(c), (d)(6), (e), 425(b), (c), 427(d), 433(a), Oct. 15, 1982, 96 Stat. 1473, 1474, 1512, 1523–1527; Pub. L. 99–570, title I, § 1359(a), Oct. 27, 1986, 100 Stat. 3207–27; Pub. L. 101–73, title II, § 201, title IX, §§ 901(b)(1), (d), 902(a), 903(a), 904(a), 905(a), 906(a), 907(a), 908(a), 912, 913(a), 920(a), (c), 926, Aug. 9, 1989, 103 Stat. 187, 446, 450, 453, 457, 459, 462, 477, 482, 483, 488; Pub. L. 101–647, title XXV, §§ 2521(b)(1), 2532(a), 2547(a)(1), (2), 2596(a), (b), Nov. 29, 1990, 104 Stat. 4864, 4880, 4886, 4887, 4908; Pub. L. 102–233, title III, § 302(a), Dec. 12, 1991, 105 Stat. 1767; Pub. L. 102–242, title I, § 131(c)(1), (2), title III, §§ 302(e)(5), formerly (e)(4), 307, Dec. 19, 1991, 105 Stat. 2266, 2349, 2360; Pub. L. 102–550, title XV, §§ 1503(a), 1504(a), title XVI, §§ 1603(d)(2)–(4), 1605(a)(5)(A), (11), Oct. 28, 1992, 106 Stat. 4048

CITE AS: 12 USC 1818

§ 1819. Corporate powers
(a) In general
(b) Agency authority
(1) Status
(2) Federal court jurisdiction
(A) In general
(B) Removal
(C) Appeal of remand
(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
(3) Service of process
(4) Bonds or fees
(Sept. 21, 1950, ch. 967, § 2[9], 64 Stat. 881; Pub. L. 89–695, title II, § 205, Oct. 16, 1966, 80 Stat. 1055;

CITE AS: 12 USC 1819

§ 1820. Administration of Corporation
(a) Board of Directors; use of mails; cooperation with other Federal agencies
(b) Examinations
(1) Appointment of examiners and claims agents
(2) Regular examinationsAny examiner appointed under paragraph (1) shall have power, on behalf of the Corporation, to examine—
(A) any insured State nonmember bank or insured State branch of any foreign bank;
(B) any depository institution which files an application with the Corporation to become an insured depository institution; and
(C) any insured depository institution in default,
whenever the Board of Directors determines an examination of any such depository institution is necessary.
(3) Special examination of any insured depository institution
(A) In general
(B) Limitation
(4) Examination of affiliates
(A) In generalIn making any examination under paragraph (2) or (3), any examiner appointed under paragraph (1) shall have power, on behalf of the Corporation, to make such examinations of the affairs of any affiliate of any depository institution as may be necessary to disclose fully—
(i) the relationship between such depository institution and any such affiliate; and
(ii) the effect of such relationship on the depository institution.
(B) Commitment by foreign banks to allow examinations of affiliates
(5) Examination of insured State branchesThe Board of Directors shall—
(A) coordinate examinations of insured State branches of foreign banks with examinations conducted by the Board of Governors of the Federal Reserve System under section 3105(c)(1) of this title; and
(B) to the extent possible, participate in any simultaneous examination of the United States operations of a foreign bank requested by the Board under such section.
(6) Power and duty of examinersEach examiner appointed under paragraph (1) shall—
(A) have power to make a thorough examination of any insured depository institution or affiliate under paragraph (2), (3), (4), or (5); and
(B) shall make a full and detailed report of condition of any insured depository institution or affiliate examined to the Corporation.
(7) Power of claim agents
(c) Administration of oaths and affirmations; evidence; subpena powers
(d) Annual on-site examinations of all insured depository institutions required
(1) In general
(2) Examinations by Corporation
(3) State examinations acceptable
(4) 18-month rule for certain small institutionsParagraphs (1), (2), and (3) shall apply with “18-month” substituted for “12-month” if—
(A) the insured depository institution has total assets of less than $3,000,000,000;
(B) the institution is well capitalized, as defined in section 1831o of this title;
(C) when the institution was most recently examined, it was found to be well managed, and its composite condition—
(i) was found to be outstanding; or
(ii) was found to be outstanding or good, in the case of an insured depository institution that has total assets of not more than $200,000,000;
(D) the insured institution is not currently subject to a formal enforcement proceeding or order by the Corporation or the appropriate Federal banking agency; and
(E) no person acquired control of the institution during the 12-month period in which a full-scope, on-site examination would be required but for this paragraph.
(5) Certain Government-controlled institutions exemptedParagraph (1) does not apply to—
(A) any institution for which the Corporation is conservator; or
(B) any bridge depository institution, none of the voting securities of which are owned by a person or agency other than the Corporation.
(6) Coordinated examinationsTo minimize the disruptive effects of examinations on the operations of insured depository institutions—
(A) each appropriate Federal banking agency shall, to the extent practicable and consistent with principles of safety and soundness and the public interest—
(i) coordinate examinations to be conducted by that agency at an insured depository institution and its affiliates;
(ii) coordinate with the other appropriate Federal banking agencies in the conduct of such examinations;
(iii) work to coordinate with the appropriate State bank supervisor—(I) the conduct of all examinations made pursuant to this subsection; and(II) the number, types, and frequency of reports required to be submitted to such agencies and supervisors by insured depository institutions, and the type and amount of information required to be included in such reports; and
(iv) use copies of reports of examinations of insured depository institutions made by any other Federal banking agency or appropriate State bank supervisor to eliminate duplicative requests for information; and
(B) not later than 2 years after September 23, 1994, the Federal banking agencies shall jointly establish and implement a system for determining which one of the Federal banking agencies or State bank supervisors shall be the lead agency responsible for managing a unified examination of each insured depository institution and its affiliates, as required by this subsection.
(7) Separate examinations permitted
(8) Report
(9) Standards for determining adequacy of State examinations
(10) Agencies authorized to increase maximum asset amount of institutions for certain purposes
(e) Examination fees
(1) Regular and special examinations of depository institutions
(2) Examination of affiliates
(3) Assessment against depository institution in case of affiliate’s refusal to pay
(A) In generalSubject to subparagraph (B), if any affiliate of any insured depository institution—
(i) refuses to pay any assessment under paragraph (2); or
(ii) fails to pay any such assessment before the end of the 60-day period beginning on the date the affiliate receives notice of the assessment,
the Corporation may assess such cost against, and collect such cost from, the depository institution.
(B) Affiliate of more than 1 depository institution
(4) Civil money penalty for affiliate’s refusal to cooperate
(A) Penalty imposedIf any affiliate of any insured depository institution—
(i) refuses to permit an examiner appointed by the Board of Directors under subsection (b)(1) to conduct an examination; or
(ii) refuses to provide any information required to be disclosed in the course of any examination,
the depository institution shall forfeit and pay a penalty of not more than $5,000 for each day that any such refusal continues.
(B) Assessment and collection
(5) Deposits of examination assessment
(f) Preservation of agency records
(1) In generalA Federal banking agency may cause any and all records, papers, or documents kept by the agency or in the possession or custody of the agency to be—
(A) photographed or microphotographed or otherwise reproduced upon film; or
(B) preserved in any electronic medium or format which is capable of—
(i) being read or scanned by computer; and
(ii) being reproduced from such electronic medium or format by printing any other form of reproduction of electronically stored data.
(2) Treatment as original records
(3) Authority of the Federal banking agencies
(g) Authority to prescribe regulations and definitionsExcept to the extent that authority under this chapter is conferred on any of the Federal banking agencies other than the Corporation, the Corporation may—
(1) prescribe regulations to carry out this chapter; and
(2) by regulation define terms as necessary to carry out this chapter.
(h) Coordination of examination authority
(1) State bank supervisors of home and host States
(A) Home State of bank
(B) Host State branches
(C) Supervisory fees
(2) Host State examination
(A) In generalWith respect to a branch operated in a host State by an out-of-State insured State bank that resulted from an interstate merger transaction approved under section 1831u of this title, or that was established in such State pursuant to section 36(g) of this title, the third undesignated paragraph of section 321 of this title or section 1828(d)(4) of this title, the appropriate State bank supervisor of such host State may—
(i) with written notice to the State bank supervisor of the bank’s home State and subject to the terms of any applicable cooperative agreement with the State bank supervisor of such home State, examine such branch for the purpose of determining compliance with host State laws that are applicable pursuant to section 1831a(j) of this title, including those that govern community reinvestment, fair lending, and consumer protection; and
(ii) if expressly permitted under and subject to the terms of a cooperative agreement with the State bank supervisor of the bank’s home State or if such out-of-State insured State bank has been determined to be in a troubled condition by either the State bank supervisor of the bank’s home State or the bank’s appropriate Federal banking agency, participate in the examination of the bank by the State bank supervisor of the bank’s home State to ascertain that the activities of the branch in such host State are not conducted in an unsafe or unsound manner.
(B) Notice of determination
(i) In general
(ii) Timing of notice
(3) Host State enforcement
(4) Cooperative agreement
(A) In general
(B) Definition
(C) Rule of construction
(5) Federal regulatory authority
(6) State taxation authority not affected
(7) DefinitionsFor purpose of this section, the following definitions shall apply:
(A) Host State, home State, out-of-State bank
(B) State supervisory fees
(C) Troubled conditionSolely for purposes of paragraph (2)(B), an insured State bank has been determined to be in “troubled condition” if the bank—
(i) has a composite rating, as determined in its most recent report of examination, of 4 or 5 under the Uniform Financial Institutions Ratings System;
(ii) is subject to a proceeding initiated by the Corporation for termination or suspension of deposit insurance; or
(iii) is subject to a proceeding initiated by the State bank supervisor of the bank’s home State to vacate, revoke, or terminate the charter of the bank, or to liquidate the bank, or to appoint a receiver for the bank.
(D) Final determination
(i) Flood insurance compliance by insured depository institutions
(1) Examinations
(2) Report
(A) Requirement
(B) Contents
(j) Consultation among examiners
(1) In generalEach appropriate Federal banking agency shall take such action as may be necessary to ensure that examiners employed by the agency—
(A) consult on examination activities with respect to any depository institution; and
(B) achieve an agreement and resolve any inconsistencies in the recommendations to be given to such institution as a consequence of any examinations.
(2) Examiner-in-charge
(k) One-year restrictions on Federal examiners of financial institutions
(1) In generalIn addition to other applicable restrictions set forth in title 18, the penalties set forth in paragraph (6) of this subsection shall apply to any person who—
(A) was an officer or employee (including any special Government employee) of a Federal banking agency or a Federal reserve bank;
(B) served 2 or more months during the final 12 months of his or her employment with such agency or entity as the senior examiner (or a functionally equivalent position) of a depository institution or depository institution holding company with continuing, broad responsibility for the examination (or inspection) of that depository institution or depository institution holding company on behalf of the relevant agency or Federal reserve bank; and
(C) within 1 year after the termination date of his or her service or employment with such agency or entity, knowingly accepts compensation as an employee, officer, director, or consultant from—
(i) such depository institution, any depository institution holding company that controls such depository institution, or any other company that controls such depository institution; or
(ii) such depository institution holding company or any depository institution that is controlled by such depository institution holding company.
(2) DefinitionsFor purposes of this subsection—
(A) the term “depository institution” includes an uninsured branch or agency of a foreign bank, if such branch or agency is located in any State; and
(B) the term “depository institution holding company” includes any foreign bank or company described in section 3106(a) of this title.
(3) Rules of construction
(4) Regulations
(A) In general
(B) Consultation required
(5) Waiver
(A) Agency authority
(B) DefinitionFor purposes of this paragraph, the head of an agency is—
(i) the Comptroller of the Currency, in the case of the Office of the Comptroller of the Currency;
(ii) the Chairman of the Board of Governors of the Federal Reserve System, in the case of the Board of Governors of the Federal Reserve System; and
(iii) the Chairperson of the Board of Directors, in the case of the Corporation.
(6) Penalties
(A) In generalIn addition to any other administrative, civil, or criminal remedy or penalty that may otherwise apply, whenever a Federal banking agency determines that a person subject to paragraph (1) has become associated, in the manner described in paragraph (1)(C), with a depository institution, depository institution holding company, or other company for which such agency serves as the appropriate Federal banking agency, the agency shall impose upon such person one or more of the following penalties:
(i) Industry-wide prohibition orderThe Federal banking agency shall serve a written notice or order in accordance with and subject to the provisions of section 1818(e)(4) of this title for written notices or orders under paragraph (1) or (2) of section 1818(e) of this title, upon such person of the intention of the agency—(I) to remove such person from office or to prohibit such person from further participation in the conduct of the affairs of the depository institution, depository institution holding company, or other company for a period of up to 5 years; and(II) to prohibit any further participation by such person, in any manner, in the conduct of the affairs of any insured depository institution for a period of up to 5 years.
(ii) Civil monetary penalty
(B) Scope of prohibition order
(C) Definitions
(Sept. 21, 1950, ch. 967, § 2[10], 64 Stat. 882; Pub. L. 86–671, § 4, July 14, 1960, 74 Stat. 551; Pub. L. 89–695, title II, § 203, Oct. 16, 1966, 80 Stat. 1053; Pub. L. 91–452, title II, § 208, Oct. 15, 1970, 84 Stat. 929; Pub. L. 95–369, § 6(c)(16), Sept. 17, 1978, 92 Stat. 619; Pub. L. 95–630, title III, § 305, Nov. 10, 1978, 92 Stat. 3677; Pub. L. 97–320, title I, § 113(i), title IV, § 410(g), Oct. 15, 1982, 96 Stat. 1474, 1520; Pub. L. 100–418, title V, § 5115(c), Aug. 23, 1988, 102 Stat. 1433; Pub. L. 101–73, title II, §§ 201(a), 210, Aug. 9, 1989, 103 Stat. 187, 217; Pub. L. 102–242, title I, §§ 111(a), 113(a), (b), (c)(2), title II, § 203(c), title III, § 302(d), Dec. 19, 1991, 105 Stat. 2240, 2246–2248, 2292, 2349; Pub. L. 102–550, title XVI, §§ 1603(b)(1), (4), 1604(a)(3), 1605(a)(4), Oct. 28, 1992, 106 Stat. 4078, 4079, 4082, 4085; Pub. L. 102–558, title III, §§ 303(b)(5), 305, Oct. 28, 1992, 106 Stat. 4225, 4226; Pub. L. 103–325, title III, §§ 305(a), 306, 349(a), title V, § 529(a), title VI, § 602(a)(19), (20), Sept. 23, 1994, 108 Stat. 2216, 2217, 2242, 2266, 2289; Pub. L. 103–328, title I, § 105, Sept. 29, 1994, 108 Stat. 2357; Pub. L. 104–208, div. A, title II, §§ 2221, 2244, Sept. 30, 1996, 110 Stat. 3009–414, 3009–419; Pub. L. 108–386, § 8(a)(3), Oct. 30, 2004, 118 Stat. 2231; Pub. L. 108–458, title VI, § 6303(b), Dec. 17, 2004, 118 Stat. 3751; Pub. L. 109–351, title VI, § 605, title VII, §§ 711, 723(a), Oct. 13, 2006, 120 Stat. 1981, 1991, 2000; Pub. L. 109–473, § 1, Jan. 11, 2007, 120 Stat. 3561; Pub. L. 110–289, div. A, title VI, § 1604(b)(1)(B), July 30, 2008, 122 Stat. 2829; Pub. L. 111–203, title I, § 172(a), title III, §§ 318(d), 363(4), July 21, 2010, 124 Stat. 1438, 1527, 1552; Pub. L. 114–94, div. G, title LXXXIII, § 83001, Dec. 4, 2015, 129 Stat. 1796; Pub. L. 115–174, title II, § 210, May 24, 2018, 132 Stat. 1316.)

CITE AS: 12 USC 1820

§ 1820a. Examination of investment companies
(a) Exclusive Commission authority
(b) Examination results and other information
(c) Certain examinations authorized
(d) Definitions
For purposes of this section, the following definitions shall apply:
(1) Bank holding company
(2) Commission
(3) Corporation
(4) Federal banking agency
(5) Insured depository institution
(6) Registered investment company
(7) Savings and loan holding company
(Pub. L. 106–102, title I, § 115, Nov. 12, 1999, 113 Stat. 1371.)

CITE AS: 12 USC 1820a

§ 1821. Insurance Funds
(a) Deposit insurance
(1) Insured amounts payable
(A) In general
(B) Net amount of insured deposit
(C) Aggregation of deposits
(D) Coverage for certain employee benefit plan deposits
(i) Pass-through insurance
(ii) Prohibition on acceptance of benefit plan deposits
(iii) DefinitionsFor purposes of this subparagraph, the following definitions shall apply:(I) Capital standards(II) Employee benefit plan(III) Pass-through deposit insurance
(E) Standard maximum deposit insurance amount defined
(F) Inflation adjustment
(i) In generalBy April 1 of 2010, and the 1st day of each subsequent 5-year period, the Board of Directors and the National Credit Union Administration Board shall jointly consider the factors set forth under clause (v), and, upon determining that an inflation adjustment is appropriate, shall jointly prescribe the amount by which the standard maximum deposit insurance amount and the standard maximum share insurance amount (as defined in section 1787(k) of this title) applicable to any depositor at an insured depository institution shall be increased by calculating the product of—(I) $100,000; and(II) the ratio of the published annual value of the Personal Consumption Expenditures Chain-Type Price Index (or any successor index thereto), published by the Department of Commerce, for the calendar year preceding the year in which the adjustment is calculated under this clause, to the published annual value of such index for the calendar year preceding April 1, 2006.
 The values used in the calculation under subclause (II) shall be, as of the date of the calculation, the values most recently published by the Department of Commerce.
(ii) Rounding
(iii) Publication and report to the CongressNot later than April 5 of any calendar year in which an adjustment is required to be calculated under clause (i) to the standard maximum deposit insurance amount and the standard maximum share insurance amount under such clause, the Board of Directors and the National Credit Union Administration Board shall—(I) publish in the Federal Register the standard maximum deposit insurance amount, the standard maximum share insurance amount, and the amount of coverage under paragraph (3)(A) and section 1787(k)(3) of this title, as so calculated; and(II) jointly submit a report to the Congress containing the amounts described in subclause (I).
(iv) 6-month implementation period
(v) Inflation adjustment considerationIn making any determination under clause (i) to increase the standard maximum deposit insurance amount and the standard maximum share insurance amount, the Board of Directors and the National Credit Union Administration Board shall jointly consider—(I) the overall state of the Deposit Insurance Fund and the economic conditions affecting insured depository institutions;(II) potential problems affecting insured depository institutions; or(III) whether the increase will cause the reserve ratio of the fund to fall below 1.15 percent of estimated insured deposits.
(2) Government depositors
(A) In generalNotwithstanding any limitation in this chapter or in any other provision of law relating to the amount of deposit insurance available to any 1 depositor—
(i) a government depositor shall, for the purpose of determining the amount of insured deposits under this subsection, be deemed to be a depositor separate and distinct from any other officer, employee, or agent of the United States or any public unit referred to in subparagraph (B); and
(ii) except as provided in subparagraph (C), the deposits of a government depositor shall be insured in an amount equal to the standard maximum deposit insurance amount (as determined under paragraph (1)).
(B) Government depositorIn this paragraph, the term “government depositor” means a depositor that is—
(i) an officer, employee, or agent of the United States having official custody of public funds and lawfully investing or depositing the same in time and savings deposits in an insured depository institution;
(ii) an officer, employee, or agent of any State of the United States, or of any county, municipality, or political subdivision thereof having official custody of public funds and lawfully investing or depositing the same in time and savings deposits in an insured depository institution in such State;
(iii) an officer, employee, or agent of the District of Columbia having official custody of public funds and lawfully investing or depositing the same in time and savings deposits in an insured depository institution in the District of Columbia;
(iv) an officer, employee, or agent of the Commonwealth of Puerto Rico, of the Virgin Islands, of American Samoa, of the Trust Territory of the Pacific Islands, or of Guam, or of any county, municipality, or political subdivision thereof having official custody of public funds and lawfully investing or depositing the same in time and savings deposits in an insured depository institution in the Commonwealth of Puerto Rico, the Virgin Islands, American Samoa, the Trust Territory of the Pacific Islands, or Guam, respectively; or
(v) an officer, employee, or agent of any Indian tribe (as defined in section 1452(c) of title 25) or agency thereof having official custody of tribal funds and lawfully investing or depositing the same in time and savings deposits in an insured depository institution.
(C) Authority to limit deposits
(3) Certain retirement accounts
(A) In generalNotwithstanding any limitation in this chapter relating to the amount of deposit insurance available for the account of any 1 depositor, deposits in an insured depository institution made in connection with—
(i) any individual retirement account described in section 408(a) of title 26;
(ii) subject to the exception contained in paragraph (1)(D)(ii), any eligible deferred compensation plan described in section 457 of title 26; and
(iii) any individual account plan defined in section 1002(34) of title 29, and any plan described in section 401(d) of title 26, to the extent that participants and beneficiaries under such plan have the right to direct the investment of assets held in individual accounts maintained on their behalf by the plan,
shall be aggregated and insured in an amount not to exceed $250,000 (which amount shall be subject to inflation adjustments as provided in paragraph (1)(F), except that $250,000 shall be substituted for $100,000 wherever such term appears in such paragraph) per participant per insured depository institution.
(B) Amounts taken into account
(4) Deposit Insurance Fund
(A) EstablishmentThere is established the Deposit Insurance Fund, which the Corporation shall—
(i) maintain and administer;
(ii) use to carry out its insurance purposes, in the manner provided by this subsection; and
(iii) invest in accordance with section 1823(a) of this title.
(B) Uses
(C) Limitation on useNotwithstanding any provision of law other than section 1823(c)(4)(G) of this title, the Deposit Insurance Fund shall not be used in any manner to benefit any shareholder or affiliate (other than an insured depository institution that receives assistance in accordance with the provisions of this chapter) of—
(i) any insured depository institution for which the Corporation has been appointed conservator or receiver, in connection with any type of resolution by the Corporation;
(ii) any other insured depository institution in default or in danger of default, in connection with any type of resolution by the Corporation; or
(iii) any insured depository institution, in connection with the provision of assistance under this section or section 1823 of this title with respect to such institution, except that this clause shall not prohibit any assistance to any insured depository institution that is not in default, or that is not in danger of default, that is acquiring (as defined in section 1823(f)(8)(B) of this title) another insured depository institution.
(D) Deposits
(5) Certain investment contracts not treated as insured deposits
(A) In general
(B) DefinitionsFor purposes of subparagraph (A)—
(i) Benefit-responsive withdrawals or transfers
(ii) Employee benefit planThe term “employee benefit plan”—(I) has the meaning given to such term in section 1002(3) of title 29; and(II) includes any plan described in section 401(d) of title 26.
(b) Liquidation as closing of depository institution
(c) Appointment of Corporation as conservator or receiver
(1) In general
(2) Federal depository institutions
(A) Appointment
(i) Conservator
(ii) Receiver
(B) Additional powers
(C) Corporation not subject to any other agency
(D) Depository institution in conservatorship subject to banking agency supervision
(3) Insured State depository institutions
(A) Appointment by appropriate State supervisor
(B) Additional powers
(C) Corporation not subject to any other agency
(D) Depository institution in conservatorship subject to banking agency supervision
(4) Appointment of Corporation by the CorporationNotwithstanding 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 appointing conservator or receiverThe grounds for appointing a conservator or receiver (which may be the Corporation) for any insured depository institution are as follows:
(A)Assets insufficient for obligations.—The institution’s assets are less than the institution’s obligations to its creditors and others, including members of the institution.
(B)Substantial dissipation.—Substantial dissipation of assets or earnings due to—
(i) any violation of any statute or regulation; or
(ii) any unsafe or unsound practice.
(C)Unsafe or unsound condition.—An unsafe or unsound condition to transact business.
(D)Cease and desist orders.—Any willful violation of a cease-and-desist order which has become final.
(E)Concealment.—Any concealment of the institution’s books, papers, records, or assets, or any refusal to submit the institution’s books, papers, records, or affairs for inspection to any examiner or to any lawful agent of the appropriate Federal banking agency or State bank or savings association supervisor.
(F)Inability to meet obligations.—The institution is likely to be unable to pay its obligations or meet its depositors’ demands in the normal course of business.
(G)Losses.—The institution has incurred or is likely to incur losses that will deplete all or substantially all of its capital, and there is no reasonable prospect for the institution to become adequately capitalized (as defined in section 1831o(b) of this title) without Federal assistance.
(H)Violations of law.—Any violation of any law or regulation, or any unsafe or unsound practice or condition that is likely to—
(i) cause insolvency or substantial dissipation of assets or earnings;
(ii) weaken the institution’s condition; or
(iii) otherwise seriously prejudice the interests of the institution’s depositors or the Deposit Insurance Fund.
(I)Consent.—The institution, by resolution of its board of directors or its shareholders or members, consents to the appointment.
(J)Cessation of insured status.—The institution ceases to be an insured institution.
(K)Undercapitalization.—The institution is undercapitalized (as defined in section 1831o(b) of this title), and—
(i) has no reasonable prospect of becoming adequately capitalized (as defined in that section);
(ii) fails to become adequately capitalized when required to do so under section 1831o(f)(2)(A) of this title;
(iii) fails to submit a capital restoration plan acceptable to that agency within the time prescribed under section 1831o(e)(2)(D) of this title; or
(iv) materially fails to implement a capital restoration plan submitted and accepted under section 1831o(e)(2) of this title.
(L) The institution—
(i) is critically undercapitalized, as defined in section 1831o(b) of this title; or
(ii) otherwise has substantially insufficient capital.
(M)Money laundering offense.—The Attorney General notifies the appropriate Federal banking agency or the Corporation in writing that the insured depository institution has been found guilty of a criminal offense under section 1956 or 1957 of title 18 or section 5322 or 5324 of title 31.
(6) Appointment by Comptroller of the Currency
(A) Conservator
(B) Receiver
(7) Judicial review
(8) Replacement of conservator of State depository institution
(A) In general
(B) Replacement treated as removal of incumbent
(C) Right of review of original appointment not affected
(9) Appropriate Federal banking agency may appoint Corporation as conservator or receiver for insured State depository institution to carry out section 1831o
(A) In generalThe appropriate Federal banking agency may appoint the Corporation as sole receiver (or, subject to paragraph (11), sole conservator) of any insured State depository institution, after consultation with the appropriate State supervisor, if the appropriate Federal banking agency determines that—
(i) 1 or more of the grounds specified in subparagraphs (K) and (L) of paragraph (5) exist with respect to that institution; and
(ii) the appointment is necessary to carry out the purpose of section 1831o of this title.
(B) Nondelegation
(10) Corporation may appoint itself as conservator or receiver for insured depository institution to prevent loss to Deposit Insurance FundThe Board of Directors may appoint the Corporation as sole conservator or receiver of an insured depository institution, after consultation with the appropriate Federal banking agency and the appropriate State supervisor (if any), if the Board of Directors determines that—
(A) 1 or more of the grounds specified in any subparagraph of paragraph (5) exist with respect to the institution; and
(B) the appointment is necessary to reduce—
(i) the risk that the Deposit Insurance Fund would incur a loss with respect to the insured depository institution, or
(ii) any loss that the Deposit Insurance Fund is expected to incur with respect to that institution.
(11) Appropriate Federal banking agency shall not appoint conservator under certain provisions without giving Corporation opportunity to appoint receiver
(12) Directors not liable for acquiescing in appointment of conservator or receiverThe members of the board of directors of an insured depository institution shall not be liable to the institution’s shareholders or creditors for acquiescing in or consenting in good faith to—
(A) the appointment of the Corporation as conservator or receiver for that institution; or
(B) an acquisition or combination under section 1831o(f)(2)(A)(iii) of this title.
(13) Additional powersIn any case in which the Corporation is appointed conservator or receiver under paragraph (4), (6), (9), or (10) for any insured State depository institution—
(A) this section shall apply to the Corporation as conservator or receiver in the same manner and to the same extent as if that institution were a Federal depository institution for which the Corporation had been appointed conservator or receiver; and
(B) the Corporation as receiver of the institution may—
(i) liquidate the institution in an orderly manner; and
(ii) make any other disposition of any matter concerning the institution, as the Corporation determines is in the best interests of the institution, the depositors of the institution, and the Corporation.
(d) Powers and duties of Corporation as conservator or receiver
(1) Rulemaking authority of Corporation
(2) General powers
(A) Successor to institutionThe 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 institutionThe Corporation may (subject to the provisions of section 1831q of this title), 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 are 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
(D) Powers as conservatorThe 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
(F) Organization of new institutions
(G) Merger; transfer of assets and liabilities
(i) In generalThe 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
(H) Payment of valid obligations
(I) Subpoena authority
(i) In general
(ii) Authority of Board of Directors
(iii) Rule of construction
(J) Incidental powersThe Corporation may, as conservator or receiver—
(i) exercise all powers and authorities specifically granted to conservators or receivers, respectively, under this chapter and such incidental powers as shall be necessary to carry out such powers; and
(ii) take any action authorized by this chapter,
which the Corporation determines is in the best interests of the depository institution, its depositors, or the Corporation.
(K) Utilization of private sector
(3) Authority of receiver to determine claims
(A) In general
(B) Notice requirementsThe 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 requiredThe 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
(A) In general
(B) Final settlement payment procedure
(i) In general
(ii) Final settlement payment
(iii) Final settlement payment rate
(iv) Corporation authority
(5) Procedures for determination of claims
(A) Determination period
(i) In general
(ii) Extension of time
(iii) Mailing of notice sufficientThe 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 disallowanceIf 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
(C) Disallowance of claims filed after end of filing period
(i) In general
(ii) Certain exceptionsClause (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
(i) In general
(ii) Payments to less than fully secured creditorsIn the case of a claim of a creditor against an insured depository institution which is secured by any property or other asset of such institution, any receiver appointed for any insured depository institution—(I) may treat the portion of such claim which exceeds an amount equal to the fair market value of such property or other asset as an unsecured claim against the institution; and(II) may not make any payment with respect to such unsecured portion of the claim other than in connection with the disposition of all claims of unsecured creditors of the institution.
(iii) ExceptionsNo provision of this paragraph shall apply with respect to—(I) any extension of credit from any Federal home loan bank or Federal Reserve bank to any insured depository institution; or(II) any security interest in the assets of the institution securing any such extension of credit.
(E) No judicial review of determination pursuant to subparagraph (D)
(F) Legal effect of filing
(i) Statute of limitation tolled
(ii) No prejudice to other actions
(6) Provision for agency review or judicial determination of claims
(A) In generalBefore 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 limitationsIf 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
(B) Other review procedures
(i) In general
(ii) Criteria
(iii) Voluntary binding or nonbinding procedures
(iv) Consideration of incentives
(8) Expedited determination of claims
(A) Establishment requiredThe 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 periodBefore 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, provide a statement of each reason for the disallowance and the procedure for obtaining agency review or judicial determination.
(C) Period for filing or renewing suitAny 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
(E) Legal effect of filing
(i) Statute of limitation tolled
(ii) No prejudice to other actions
(9) Agreement as basis of claim
(A) Requirements
(B) Exception to contemporaneous execution requirement
(10) Payment of claims
(A) In general
(B) Payment of dividends on claims
(C) Rulemaking authority of Corporation
(11) Depositor preference
(A) In generalSubject to section 1815(e)(2)(C) of this title, amounts realized from the liquidation or other resolution of any insured depository institution by any receiver appointed for such institution shall be distributed to pay claims (other than secured claims to the extent of any such security) in the following order of priority:
(i) Administrative expenses of the receiver.
(ii) Any deposit liability of the institution.
(iii) Any other general or senior liability of the institution (which is not a liability described in clause (iv) or (v)).
(iv) Any obligation subordinated to depositors or general creditors (which is not an obligation described in clause (v)).
(v) Any obligation to shareholders or members arising as a result of their status as shareholders or members (including any depository institution holding company or any shareholder or creditor of such company).
(B) Effect on State law
(i) In general
(ii) Procedure for determination of inconsistency
(iii) Judicial review
(C) Accounting report
(12) Suspension of legal actions
(A) In generalAfter 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
(13) Additional rights and duties
(A) Prior final adjudication
(B) Rights and remedies of conservator or receiverIn 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
(D) Limitation on judicial reviewExcept 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.
(E) Disposition of assetsIn exercising any right, power, privilege, or authority as conservator or receiver in connection with any sale or disposition of assets of any insured depository institution for which the Corporation has been appointed conservator or receiver, including any sale or disposition of assets acquired by the Corporation under section 1823(d)(1) of this title, the Corporation shall conduct its operations in a manner which—
(i) maximizes the net present value return from the sale or disposition of such assets;
(ii) minimizes the amount of any loss realized in the resolution of cases;
(iii) ensures adequate competition and fair and consistent treatment of offerors;
(iv) prohibits discrimination on the basis of race, sex, or ethnic groups in the solicitation and consideration of offers; and
(v) maximizes the preservation of the availability and affordability of residential real property for low- and moderate-income individuals.
(14) Statute of limitations for actions brought by conservator or receiver
(A) In generalNotwithstanding 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 (other than a claim which is subject to section 1441a(b)(14) 2 of this title), 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 accruesFor purposes of subparagraph (A), the date on which the statute of limitations 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.
(C) Revival of expired State causes of action
(i) In general
(ii) Claims described
(15) Accounting and recordkeeping requirements
(A) In general
(B) Annual accounting or report
(C) Availability of reports
(D) Recordkeeping requirement
(i) In general
(ii) Old records
(16) Contracts with State housing finance authorities
(A) In general
(B) Factors to considerIn 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 disposition 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.
(17) Fraudulent transfers
(A) In general
(B) Right of recoveryTo the extent a transfer is avoided under subparagraph (A), the Corporation or any conservator described in such subparagraph may recover, for the benefit of the insured depository institution, the property transferred, or, if a court so orders, the value of such property (at the time of such transfer) from—
(i) the initial transferee of such transfer or the institution-affiliated party or person for whose benefit such transfer was made; or
(ii) any immediate or mediate transferee of any such initial transferee.
(C) Rights of transferee or obligeeThe Corporation or any conservator described in subparagraph (A) may not recover under subparagraph (B) from—
(i) any transferee that takes for value, including satisfaction or securing of a present or antecedent debt, in good faith; or
(ii) any immediate or mediate good faith transferee of such transferee.
(D) Rights under this paragraph
(18) Attachment of assets and other injunctive reliefSubject to paragraph (19), any court of competent jurisdiction may, at the request of—
(A) the Corporation (in the Corporation’s capacity as conservator or receiver for any insured depository institution or in the Corporation’s corporate capacity with respect to any asset acquired or liability assumed by the Corporation under this section or section 1822 or 1823 of this title); or
(B) any conservator appointed by the Comptroller of the Currency,
issue an order in accordance with Rule 65 of the Federal Rules of Civil Procedure, including an order placing the assets of any person designated by the Corporation or such conservator under the control of the court and appointing a trustee to hold such assets.
(19) Standards
(A) Showing
(B) State proceeding
(20) Treatment of claims arising from breach of contracts executed by the receiver or conservator
(e) Provisions relating to contracts entered into before appointment of conservator or receiver
(1) Authority to repudiate contractsIn 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
(3) Claims for damages for repudiation
(A) In generalExcept 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 damagesFor 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 contractsIn 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 (i) except as otherwise specifically provided in this section.
(4) Leases under which the institution is the lessee
(A) In general
(B) Payments of rentNotwithstanding 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 (i).
(5) Leases under which the institution is the lessor
(A) In generalIf 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 possessionIf 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 generalIf the conservator or receiver repudiates any contract (which meets the requirements of each paragraph of section 1823(e) of this title) 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 possessionIf 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
(ii) No liability after assignment and sale
(7) Provisions applicable to service contracts
(A) Services performed before appointmentIn 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 repudiationIf, 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
(8) Certain qualified financial contracts
(A) Rights of parties to contractsSubject to paragraphs (9) and (10) of this subsection and notwithstanding any other provision of this chapter (other than subsection (d)(9) of this section and section 1823(e) of this title), 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 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 agreement or arrangement or other credit enhancement related to one or more qualified financial contracts described in clause (i); 3
3 So in original. Probably should be followed by “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
(C) Certain transfers not avoidable
(i) In general
(ii) Exception for certain transfers
(D) Certain contracts and agreements definedFor purposes of this subsection, the following definitions shall apply:
(i) Qualified financial contract
(ii) Securities contractThe term “securities contract”—(I) means a contract for the purchase, sale, or loan of a security, a certificate of deposit, a mortgage loan, any interest in a mortgage loan, a group or index of securities, certificates of deposit, or mortgage loans or interests therein (including any interest therein or based on the value thereof) or any option on any of the foregoing, including any option to purchase or sell any such security, certificate of deposit, mortgage loan, interest, group or index, or option, and including any repurchase or reverse repurchase transaction on any such security, certificate of deposit, mortgage loan, interest, group or index, or option (whether or not such repurchase or reverse repurchase transaction is a “repurchase agreement”, as defined in clause (v));(II) does not include any purchase, sale, or repurchase obligation under a participation in a commercial mortgage loan unless the Corporation determines by regulation, resolution, or order to include any such agreement within the meaning of such term;(III) means any option entered into on a national securities exchange relating to foreign currencies;(IV) means the guarantee (including by novation) by or to any securities clearing agency of any settlement of cash, securities, certificates of deposit, mortgage loans or interests therein, group or index of securities, certificates of deposit, or mortgage loans or interests therein (including any interest therein or based on the value thereof) or option on any of the foregoing, including any option to purchase or sell any such security, certificate of deposit, mortgage loan, interest, group or index, or option (whether or not such settlement is in connection with any agreement or transaction referred to in subclauses (I) through (XII) (other than subclause (II)); 4
4 So in original. The semicolon probably should be preceded by an additional closing parenthesis.
(V) means any margin loan;(VI) means any extension of credit for the clearance or settlement of securities transactions;(VII) means any loan transaction coupled with a securities collar transaction, any prepaid securities forward transaction, or any total return swap transaction coupled with a securities sale transaction;(VIII) means any other agreement or transaction that is similar to any agreement or transaction referred to in this clause;(IX) means any combination of the agreements or transactions referred to in this clause;(X) means any option to enter into any agreement or transaction referred to in this clause;(XI) means a master agreement that provides for an agreement or transaction referred to in subclause (I), (III), (IV), (V), (VI), (VII), (VIII), (IX), or (X), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a securities contract under this clause, except that the master agreement shall be considered to be a securities contract under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (III), (IV), (V), (VI), (VII), (VIII), (IX), or (X); and(XII) means any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in this clause, including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in this clause.
(iii) Commodity contractThe term “commodity contract” means—(I) with respect to a futures commission merchant, a contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a contract market or board of trade;(II) with respect to a foreign futures commission merchant, a foreign future;(III) with respect to a leverage transaction merchant, a leverage transaction;(IV) with respect to a clearing organization, a contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a contract market or board of trade that is cleared by such clearing organization, or commodity option traded on, or subject to the rules of, a contract market or board of trade that is cleared by such clearing organization;(V) with respect to a commodity options dealer, a commodity option;(VI) any other agreement or transaction that is similar to any agreement or transaction referred to in this clause;(VII) any combination of the agreements or transactions referred to in this clause;(VIII) any option to enter into any agreement or transaction referred to in this clause;(IX) a master agreement that provides for an agreement or transaction referred to in subclause (I), (II), (III), (IV), (V), (VI), (VII), or (VIII), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a commodity contract under this clause, except that the master agreement shall be considered to be a commodity contract under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (II), (III), (IV), (V), (VI), (VII), or (VIII); or(X) any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in this clause, including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in this clause.
(iv) Forward contractThe term “forward contract” means—(I) a contract (other than a commodity contract) for the purchase, sale, or transfer of a commodity or any similar good, article, service, right, or interest which is presently or in the future becomes the subject of dealing in the forward contract trade, or product or byproduct thereof, with a maturity date more than 2 days after the date the contract is entered into, including,5
5 So in original. The comma probably should not appear.
a repurchase or reverse repurchase transaction (whether or not such repurchase or reverse repurchase transaction is a “repurchase agreement”, as defined in clause (v)), consignment, lease, swap, hedge transaction, deposit, loan, option, allocated transaction, unallocated transaction, or any other similar agreement;(II) any combination of agreements or transactions referred to in subclauses (I) and (III);(III) any option to enter into any agreement or transaction referred to in subclause (I) or (II);(IV) a master agreement that provides for an agreement or transaction referred to in subclauses (I), (II), or (III), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a forward contract under this clause, except that the master agreement shall be considered to be a forward contract under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (II), or (III); or(V) any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in subclause (I), (II), (III), or (IV), including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in any such subclause.
(v) Repurchase agreementThe term “repurchase agreement” (which definition also applies to a reverse repurchase agreement)—(I) means an agreement, including related terms, which provides for the transfer of one or more certificates of deposit, mortgage-related securities (as such term is defined in the Securities Exchange Act of 1934 [15 U.S.C. 78a et seq.]), mortgage loans, interests in mortgage-related securities or mortgage loans, eligible bankers’ acceptances, qualified foreign government securities or securities that are direct obligations of, or that are fully guaranteed by, the United States or any agency of the United States against the transfer of funds by the transferee of such certificates of deposit, eligible bankers’ acceptances, securities, mortgage loans, or interests with a simultaneous agreement by such transferee to transfer to the transferor thereof certificates of deposit, eligible bankers’ acceptances, securities, mortgage loans, or interests as described above, at a date certain not later than 1 year after such transfers or on demand, against the transfer of funds, or any other similar agreement;(II) does not include any repurchase obligation under a 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) means any combination of agreements or transactions referred to in subclauses (I) and (IV);(IV) means any option to enter into any agreement or transaction referred to in subclause (I) or (III);(V) means a master agreement that provides for an agreement or transaction referred to in subclause (I), (III), or (IV), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a repurchase agreement under this clause, except that the master agreement shall be considered to be a repurchase agreement under this subclause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (III), or (IV); and(VI) means any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in subclause (I), (III), (IV), or (V), including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in any such subclause.
 For purposes of this clause, the term “qualified foreign government security” means a security that is a direct obligation of, or that is fully guaranteed by, the central government of a member of the Organization for Economic Cooperation and Development (as determined by regulation or order adopted by the appropriate Federal banking authority).
(vi) Swap agreementThe term “swap agreement” means—(I) any agreement, including the terms and conditions incorporated by reference in any such agreement, which is an interest rate swap, option, future, or forward agreement, including a rate floor, rate cap, rate collar, cross-currency rate swap, and basis swap; a spot, same day-tomorrow, tomorrow-next, forward, or other foreign exchange, precious metals, or other commodity agreement; a currency swap, option, future, or forward agreement; an equity index or equity swap, option, future, or forward agreement; a debt index or debt swap, option, future, or forward agreement; a total return, credit spread or credit swap, option, future, or forward agreement; a commodity index or commodity swap, option, future, or forward agreement; weather swap, option, future, or forward agreement; an emissions swap, option, future, or forward agreement; or an inflation swap, option, future, or forward agreement;(II) any agreement or transaction that is similar to any other agreement or transaction referred to in this clause and that is of a type that has been, is presently, or in the future becomes, the subject of recurrent dealings in the swap or other derivatives markets (including terms and conditions incorporated by reference in such agreement) and that is a forward, swap, future, option, or spot transaction on one or more rates, currencies, commodities, equity securities or other equity instruments, debt securities or other debt instruments, quantitative measures associated with an occurrence, extent of an occurrence, or contingency associated with a financial, commercial, or economic consequence, or economic or financial indices or measures of economic or financial risk or value;(III) any combination of agreements or transactions referred to in this clause;(IV) any option to enter into any agreement or transaction referred to in this clause;(V) a master agreement that provides for an agreement or transaction referred to in subclause (I), (II), (III), or (IV), together with all supplements to any such master agreement, without regard to whether the master agreement contains an agreement or transaction that is not a swap agreement under this clause, except that the master agreement shall be considered to be a swap agreement under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (II), (III), or (IV); and(VI) any security agreement or arrangement or other credit enhancement related to any agreements or transactions referred to in subclause (I), (II), (III), (IV), or (V), including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in any such subclause.
 Such term is applicable for purposes of this subsection only and shall not be construed or applied so as to challenge or affect the characterization, definition, or treatment of any swap agreement under any other statute, regulation, or rule, including the Gramm-Leach-Bliley Act, the Legal Certainty for Bank Products Act of 2000 [7 U.S.C. 27 to 27f], the securities laws (as such term is defined in section 3(a)(47) of the Securities Exchange Act of 1934 [15 U.S.C. 78c(a)(47)]) and the Commodity Exchange Act [7 U.S.C. 1 et seq.].
(vii) Treatment of master agreement as one agreement
(viii) Transfer
(ix) Person
(E) Certain protections in event of appointment of conservatorNotwithstanding any other provision of this chapter (other than subsections (d)(9) and (e)(10) of this section, and section 1823(e) of this title), 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 agreement or arrangement or other credit enhancement related to one or more qualified financial contracts described in clause (i); 3
(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.
(F) Clarification
(G) Walkaway clauses not effective
(i) In general
(ii) Limited suspension of certain obligationsIn the case of a qualified financial contract referred to in clause (i), any payment or delivery obligations otherwise due from a party pursuant to the qualified financial contract shall be suspended from the time the receiver is appointed until the earlier of—(I) the time such party receives notice that such contract has been transferred pursuant to subparagraph (A); or(II) 5:00 p.m. (eastern time) on the business day following the date of the appointment of the receiver.
(iii) Walkaway clause defined
(H) Recordkeeping requirements
(9) Transfer of qualified financial contracts
(A) In generalIn 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—
(i) transfer to one financial institution, other than a financial institution for which a conservator, receiver, trustee in bankruptcy, or other legal custodian has been appointed or which is otherwise the subject of a bankruptcy or insolvency proceeding—(I) all qualified financial contracts between any person or any affiliate of such person and 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 or any other credit enhancement for any contract described in subclause (I) or any claim described in subclause (II) or (III) under any such contract; or
(ii) transfer none of the qualified financial contracts, claims, property or other credit enhancement referred to in clause (i) (with respect to such person and any affiliate of such person).
(B) Transfer to foreign bank, foreign financial institution, or branch or agency of a foreign bank or financial institution
(C) Transfer of contracts subject to the rules of a clearing organization
(D) Definitions
(10) Notification of transfer
(A) In generalIf—
(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 notify any person who is a party to any such contract of such transfer by 5:00 p.m. (eastern time) on the business day following the date of the appointment of the receiver in the case of a receivership, or the business day following such transfer in the case of a conservatorship.
(B) Certain rights not enforceable
(i) ReceivershipA person who is a party to a qualified financial contract with an insured depository institution may not exercise any right that such person has to terminate, liquidate, or net such contract under paragraph (8)(A) of this subsection or section 4403 or 4404 of this title, solely by reason of or incidental to the appointment of a receiver for the depository institution (or the insolvency or financial condition of the depository institution for which the receiver has been appointed)—(I) until 5:00 p.m. (eastern time) on the business day following the date of the appointment of the receiver; or(II) after the person has received notice that the contract has been transferred pursuant to paragraph (9)(A).
(ii) Conservatorship
(iii) Notice
(C) Treatment of bridge depository institutionsThe following institutions shall not be considered to be a financial institution for which a conservator, receiver, trustee in bankruptcy, or other legal custodian has been appointed or which is otherwise the subject of a bankruptcy or insolvency proceeding for purposes of paragraph (9):
(i) A bridge depository institution.
(ii) A depository institution organized by the Corporation, for which a conservator is appointed either—(I) immediately upon the organization of the institution; or(II) at the time of a purchase and assumption transaction between the depository institution and the Corporation as receiver for a depository institution in default.
(D) “Business day” defined
(11) Disaffirmance or repudiation of qualified financial contractsIn exercising the rights of disaffirmance or repudiation of a conservator or receiver with respect to any qualified financial contract to which an insured depository institution is a party, the conservator or receiver for such institution shall either—
(A) disaffirm or repudiate all qualified financial contracts between—
(i) any person or any affiliate of such person; and
(ii) the depository institution in default; or
(B) disaffirm or repudiate none of the qualified financial contracts referred to in subparagraph (A) (with respect to such person or any affiliate of such person).
(12) Certain security interests not avoidable
(13) Authority to enforce contracts
(A) In general
(B) Certain rights not affected
(C) Consent requirement
(i) In general
(ii) Certain exceptions
(iii) Rule of construction
(14) Exception for Federal Reserve and Federal home loan banksNo 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.
(15) Selling credit card accounts receivable
(A) Notification required
(B) Waiver by CorporationThe Corporation may at any time, in its sole discretion and upon such terms as it may prescribe, waive its right to repudiate an agreement to sell credit card accounts receivable if the Corporation—
(i) determines that the waiver is in the best interests of the Deposit Insurance Fund; and
(ii) provides a written waiver to the selling institution.
(C) Effect of waiver on successors
(i) In generalIf, under subparagraph (B), the Corporation has waived its right to repudiate an agreement to sell credit card accounts receivable—(I) any provision of the agreement that restricts solicitation of a credit card customer of the selling institution, or the use of a credit card customer list of the institution, shall bind any receiver or conservator of the institution; and(II) the Corporation shall require any acquirer of the selling institution, or of substantially all of the selling institution’s assets or liabilities, to agree to be bound by a provision described in subclause (I) as if the acquirer were the selling institution.
(ii) ExceptionClause (i)(II) does not—(I) restrict the acquirer’s authority to offer any product or service to any person identified without using a list of the selling institution’s customers in violation of the agreement;(II) require the acquirer to restrict any preexisting relationship between the acquirer and a customer; or(III) apply to any transaction in which the acquirer acquires only insured deposits.
(D) Waiver not actionable
(E) Other authority not affected
(16) Certain credit card customer lists protected
(A) In general
(B) Fraudulent transactions excluded
(17) Savings clause
(f) Payment of insured deposits
(1) In general
(2) Proof of claims
(3) Resolution of disputes
(4) Review of Corporation determination
(5) Statute of limitations
(g) Subrogation of Corporation
(1) In general
(2) Dividends on subrogated amounts
(3) Waiver of certain claims
(4) Applicability of State law
(h) Conditions applicable to resolution proceedings
(1) Consideration of local economic impact required
(2) Actions to alleviate adverse economic impact to be considered
(3) Guidelines required
(4) Financial services industry impact analysisAfter the appointment of the Corporation as conservator or receiver for any insured depository institution and before taking any action under this section or section 1823 of this title in connection with the resolution of such institution, the Corporation shall—
(A) evaluate the likely impact of the means of resolution, and any action which the Corporation may take in connection with such resolution, on the viability of other insured depository institutions in the same community; and
(B) take such evaluation into account in determining the means for resolving the institution and establishing the terms and conditions for any such action.
(i) Valuation of claims in default
(1) In general
(2) Maximum liability
(3) Additional payments authorized
(A) In general
(B) Manner of payment
(j) Limitation on court action
(k) Liability of directors and officersA 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 1823 of this title,
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
(m) New depository institutions
(1) Organization authorized
(2) Articles of association
(3) Capital stock
(4) Executive officer
(5) Subject to laws relating to national banks
(6) New deposits
(7) Insured status
(8) Investments
(9) Conduct of business
(10) Exempt status
(11) Transfer of deposits
(A) Upon the organization of a new depository institution, the Corporation shall promptly make available to it an amount equal to the estimated insured deposits of such depository institution in default plus the estimated amount of the expenses of operating the new depository institution, and shall determine as soon as possible the amount due each depositor for the depositor’s insured deposit in the insured depository institution in default, and the total expenses of operation of the new depository institution.
(B) Upon such determination, the amounts so estimated and made available shall be adjusted to conform to the amounts so determined.
(12) Earnings
(13) Losses
(14) Payment of insured deposits
(A) The new depository institution shall assume as transferred deposits the payment of the insured deposits of such depository institution in default to each of its depositors.
(B) Of the amounts so made available, the Corporation shall transfer to the new depository institution, 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 depository institution 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 depository institution 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 depository institution on a sound basis.
(B) The stockholders of the insured depository institution in default shall be given the first opportunity to purchase any shares of common stock so offered.
(16) Issuance of certificate
(17) Transfer to other institution
(18) Winding up
(19) Applicability of certain laws
(n) Bridge depository institutions
(1) Organization
(A) Purpose
(B) AuthoritiesUpon the granting of a charter to a bridge depository institution, the bridge depository institution may—
(i) assume such deposits of such insured depository institution or institutions that is or are in default or in danger of default as the Corporation may, in its discretion, determine to be appropriate;
(ii) assume such other liabilities (including liabilities associated with any trust business) of such insured depository institution or institutions 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 depository institution or institutions 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 chapter.
(C) Articles of association
(D) Interim directors
(E) National bank or Federal savings association
(2) Chartering
(A) ConditionsA national bank or Federal savings association may be chartered by the Comptroller of the Currency as a bridge depository institution only if the Board of Directors determines that—
(i) the amount which is reasonably necessary to operate such bridge depository institution 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 depository institutions in default or in danger of default with respect to which the bridge depository institution is chartered;
(ii) the continued operation of such insured depository institution or institutions in default or in danger of default with respect to which the bridge depository institution is chartered is essential to provide adequate banking services in the community where each such depository institution in default or in danger of default is located; or
(iii) the continued operation of such insured depository institution or institutions in default or in danger of default with respect to which the bridge depository institution is chartered is in the best interest of the depositors of such depository institution or institutions in default or in danger of default or the public.
(B) Insured national bank or Federal savings association
(C) Bridge bank 6
6 So in original. Probably should be “Bridge depository institution”.
treated as being in default for certain purposes
(D) Management
(E) Bylaws
(3) Transfer of assets and liabilities
(A) In general
(i) Transfer upon grant of charter
(ii) Subsequent transfers
(iii) Treatment of trust business
(iv) Effective without approval
(B) Intent of Congress regarding continuing operationsIt is the intent of the Congress that, in order to prevent unnecessary hardship or losses to the customers of any insured depository institution in default with respect to which a bridge depository institution is chartered, especially creditworthy farmers, small businesses, and households, the Corporation should—
(i) continue to honor commitments made by the depository institution 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 7
7 So in original. Probably should be “bridge depository institutions”.
Each bridge depository institution chartered under this subsection shall have all corporate powers of, and be subject to the same provisions of law as, a national bank or Federal savings association, as appropriate, except that—
(A) the Corporation may—
(i) remove the interim directors and directors of a bridge depository institution;
(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 depository institution; and
(iii) waive any requirement established under section 71, 72, 73, 74, or 75 of this title (relating to directors of national banks) or section 71a of this title which would otherwise be applicable with respect to directors of a bridge depository institution 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 depository institution on such terms as the Corporation determines to be appropriate;
(C) no requirement under any provision of law relating to the capital of a national bank shall apply with respect to a bridge depository institution;
(D) the Comptroller of the Currency may establish a limitation on the extent to which any person may become indebted to a bridge depository institution without regard to the amount of the bridge depository institution’s capital or surplus;
(E)
(i) the board of directors of a bridge depository institution 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; and
(ii) the board of directors of a bridge depository institution 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 depository institution 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 depository institution at the request of the Corporation;
(H) any judicial action to which a bridge depository institution becomes a party by virtue of its acquisition of any assets or assumption of any liabilities of a depository institution in default shall be stayed from further proceedings for a period of up to 45 days at the request of the bridge depository institution;
(I) no agreement which tends to diminish or defeat the right, title or interest of a bridge depository institution in any asset of an insured depository institution in default acquired by it shall be valid against the bridge depository institution unless such agreement—
(i) is in writing,
(ii) was executed by such insured depository institution 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 depository institution in default,
(iii) was approved by the board of directors of such insured depository institution 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 depository institution in default;
(J) notwithstanding section 1823(e)(2) of this title, 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 depository institution 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 requiredThe Corporation shall not be required to—
(i) issue any capital stock on behalf of a bridge depository institution chartered under this subsection; or
(ii) purchase any capital stock of a bridge depository institution, except that notwithstanding any other provision of Federal or State law, the Corporation may purchase and retain capital stock of a bridge depository institution in such amounts and on such terms as the Corporation, in its discretion, determines to be appropriate.
(B) Operating funds in lieu of capital
(C) Authority to issue capital stock
(D) Capital levels
(6) No Federal status
(A) Agency status
(B) Employee statusRepresentatives for purposes of paragraph (1)(B), interim directors, directors, officers, employees, or agents of a bridge depository institution 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 depository institution 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 or any other provision of law, or
(ii) receive any salary or benefits for service in any such capacity with respect to a bridge depository institution in addition to such salary or benefits as are obtained through employment with the Corporation or such Federal instrumentality.
(7) Assistance authorized
(8) Acquisition
(A) In general
(B) By out-of-State holding company
(9) Duration of bridge depository institution
(10) Termination of bridge depository institution statusThe status of any bridge depository institution as such shall terminate upon the earliest of—
(A) the merger or consolidation of the bridge depository institution with a depository institution that is not a bridge depository institution;
(B) at the election of the Corporation, the sale of a majority of the capital stock of the bridge depository institution to an entity other than the Corporation and other than another bridge depository institution;
(C) the sale of 80 percent, or more, of the capital stock of the bridge depository institution to an entity other than the Corporation and other than another bridge depository institution;
(D) at the election of the Corporation, either the assumption of all or substantially all of the deposits and other liabilities of the bridge depository institution by a depository institution holding company or a depository institution that is not a bridge depository institution, or the acquisition of all or substantially all of the assets of the bridge depository institution by a depository institution holding company, a depository institution that is not a bridge depository institution, 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 depository institution as provided in paragraph (12).
(11) Effect of termination events
(A) Merger or consolidation
(B) Charter conversion
(C) Sale of stock
(D) Assumption of liabilities and sale of assets
(E) Effect on holding companies
(F) Amendments to charter
(12) Dissolution of bridge depository institution
(A) In generalNotwithstanding any other provision of State or Federal law, if the bridge depository institution’s status as such has not previously been terminated by the occurrence of an event specified in subparagraph (A), (B), (C), or (D) of paragraph (10)—
(i) the Board of Directors may, in its discretion, dissolve a bridge depository institution 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 depository institution was chartered, or any extension thereof, as provided in paragraph (9).
(B) Procedures
(13) Multiple bridge depository institutions
(o) Supervisory records
(p) Certain sales of assets prohibited
(1) Persons who engaged in improper conduct with, or caused losses to, depository institutionsThe Corporation shall prescribe regulations which, at a minimum, shall prohibit the sale of assets of a failed institution by the Corporation to—
(A) any person who—
(i) has defaulted, or was a member of a partnership or an officer or director of a corporation that has defaulted, on 1 or more obligations the aggregate amount of which exceed $1,000,000, to such failed institution;
(ii) has been found to have engaged in fraudulent activity in connection with any obligation referred to in clause (i); and
(iii) proposes to purchase any such asset in whole or in part through the use of the proceeds of a loan or advance of credit from the Corporation or from any institution for which the Corporation has been appointed as conservator or receiver;
(B) any person who participated, as an officer or director of such failed institution or of any affiliate of such institution, in a material way in transactions that resulted in a substantial loss to such failed institution;
(C) any person who has been removed from, or prohibited from participating in the affairs of, such failed institution pursuant to any final enforcement action by an appropriate Federal banking agency; or
(D) any person who has demonstrated a pattern or practice of defalcation regarding obligations to such failed institution.
(2) Convicted debtorsExcept as provided in paragraph (3), any person who—
(A) has been convicted of an offense under section 215, 656, 657, 1005, 1006, 1007, 1008,2 1014, 1032, 1341, 1343, or 1344 of title 18 or of conspiring to commit such an offense, affecting any insured depository institution for which any conservator or receiver has been appointed; and
(B) is in default on any loan or other extension of credit from such insured depository institution which, if not paid, will cause substantial loss to the institution, the Deposit Insurance Fund, or the Corporation,
may not purchase any asset of such institution from the conservator or receiver.
(3) Settlement of claimsParagraphs (1) and (2) shall not apply to the sale or transfer by the Corporation of any asset of any insured depository institution to any person if the sale or transfer of the asset resolves or settles, or is part of the resolution or settlement, of—
(A) 1 or more claims that have been, or could have been, asserted by the Corporation against the person; or
(B) obligations owed by the person to any insured depository institution or the Corporation.
(4) “Default” defined
(q) Expedited procedures for certain claims
(1) Time for filing notice of appeal
(2) Scheduling
(3) Judicial discretion
(r) Foreign investigationsThe Corporation, as conservator or receiver of any insured depository institution and for purposes of carrying out any power, authority, or duty with respect to an insured depository institution—
(1) may request the assistance of any foreign banking authority and provide assistance to any foreign banking authority in accordance with section 1818(v) of this title; and
(2) may each maintain an office to coordinate foreign investigations or investigations on behalf of foreign banking authorities.
(s) Prohibition on entering secrecy agreements and protective orders
(t) Agencies may share information without waiving privilege
(1) In generalA covered agency, in any capacity, shall not be deemed to have waived any privilege applicable to any information by transferring that information to or permitting that information to be used by—
(A) any other covered agency, in any capacity; or
(B) any other agency of the Federal Government (as defined in section 6 of title 18).
(2) DefinitionsFor purposes of this subsection:
(A) Covered agencyThe term “covered agency” means any of the following:
(i) Any Federal banking agency.
(ii) The Farm Credit Administration.
(iii) The Farm Credit System Insurance Corporation.
(iv) The National Credit Union Administration.
(v) The Government Accountability Office.
(vi) The Bureau of Consumer Financial Protection.
(vii) Federal 10
10 So in original. Probably should be preceded by “The”.
Housing Finance Agency.
(B) Privilege
(3) Rule of construction
(u) Purchase rights of tenants
(1) Notice
(2) PreferenceIn selling such a property, the Corporation shall give preference to any bona fide offer made by the household residing in the property, if—
(A) such offer is substantially similar in amount to other offers made within such period (or expected by the Corporation to be made within such period);
(B) such offer is made during the period beginning upon the Corporation making such property available and of a reasonable duration, as determined by the Corporation based on the normal period for sale of such properties; and
(C) the household making the offer complies with any other requirements applicable to purchasers of such property, including any downpayment and credit requirements.
(3) ExceptionsParagraphs (1) and (2) shall not apply to—
(A) any residence transferred in connection with the transfer of substantially all of the assets of an insured depository institution for which the Corporation has been appointed conservator or receiver;
(B) any eligible single family property (as such term is defined in section 1831q(p) of this title; or
(C) any residence for which the household occupying the residence was the mortgagor under a mortgage on such residence and to which the Corporation acquired title pursuant to default on such mortgage.
(v) Preference for sales for homeless families
(w) Preferences for sales of certain commercial real properties
(1) AuthorityIn selling any eligible commercial real properties of the Corporation, the Corporation shall give preference, among offers to purchase the property that will result in the same net present value proceeds, to any offer—
(A) that is made by a public agency or nonprofit organization; and
(B) under which the purchaser agrees that the property shall be used, during the remaining useful life of the property, for offices and administrative purposes of the purchaser to carry out a program to acquire residential properties to provide (i) homeownership and rental housing opportunities for very-low-, low-, and moderate-income families, or (ii) housing or shelter for homeless persons (as such term is defined in section 11302 of title 42) or homeless families.
(2) DefinitionsFor purposes of this subsection, the following definitions shall apply:
(A) Eligible commercial real property
(B) Nonprofit organization and public agency
(Sept. 21, 1950, ch. 967, § 2[11], 64 Stat. 884; Pub. L. 89–695, title III, § 301(c), (d), Oct. 16, 1966, 80 Stat. 1055; Pub. L. 91–151, title I, § 7(a)(3), (4), Dec. 23, 1969, 83 Stat. 375; Pub. L. 93–495, title I, §§ 101(a)(3), 102(a)(3), (4), Oct. 28, 1974, 88 Stat. 1500, 1502; Pub. L. 95–369, § 6(c)(17)–(22), Sept. 17, 1978, 92 Stat. 619; Pub. L. 95–630, title XIV, § 1401(a), Nov. 10, 1978, 92 Stat. 3712; Pub. L. 96–153, title III, § 323(a), Dec. 21, 1979, 93 Stat. 1120; Pub. L. 96–221, title III, § 308(a)(1)(C), (D), Mar. 31, 1980, 94 Stat. 147; Pub. L. 97–110, title I, § 103(c), Dec. 26, 1981, 95 Stat. 1514; Pub. L. 97–320, title I, § 113(j), (k), Oct. 15, 1982, 96 Stat. 1474; Pub. L. 99–514, § 2, Oct. 22, 1986, 100 Stat. 2095; Pub. L. 100–86, title V, §§ 503(a), 507, Aug. 10, 1987, 101 Stat. 629, 634; Pub. L. 101–73, title II, §§ 201(a), 211–214, title IX, § 909, Aug. 9, 1989, 103 Stat. 187, 218–246, 477; Pub. L. 101–647, title XXV, §§ 2521(a)(1), 2526(a), 2527(a), 2528(a), 2532(b), 2534(a), Nov. 29, 1990, 104 Stat. 4863, 4875, 4877, 4880, 4882; Pub. L. 102–233, title I, § 102, title II, § 202(a), (b), title III, § 302(a), Dec. 12, 1991, 105 Stat. 1761, 1766, 1767; Pub. L. 102–242, title I, §§ 123(a), 133(a), (e), 141(b), (d), 161(a), (e), title II, § 241(c)(1), title III, § 311(a)(1), (b)(1), (2), (5)(B), (C), title IV, §§ 416, 426, 446, Dec. 19, 1991, 105 Stat. 2252, 2270, 2272, 2277, 2285, 2286, 2331, 2363, 2364, 2366, 2376, 2378, 2382; Pub. L. 102–550, title XV, §§ 1501(a), 1544, title XVI, §§ 1603(e)(1), 1604(c)(2), 1606(c), 1611(b), Oct. 28, 1992, 106 Stat. 4044, 4069, 4081, 4083, 4088, 4090; Pub. L. 103–66, title III, § 3001(a), (b), Aug. 10, 1993, 107 Stat. 336; Pub. L. 103–204, §§ 3(d), 4(b), 8(a)–(f), (i), 11, 15(b), 16(b), 17(b), 20, 27(b), 38(b), Dec. 17, 1993, 107 Stat. 2379, 2380, 2384–2389, 2399–2401, 2404, 2410, 2416; Pub. L. 103–325, title III, § 325, title IV, § 411(c)(2)(A), title VI, § 602(a)(21)–(33), Sept. 23, 1994, 108 Stat. 2228, 2253, 2289; Pub. L. 103–328, title II, § 201(a), Sept. 29, 1994, 108 Stat. 2368; Pub. L. 103–394, title V, § 501(c)(2), Oct. 22, 1994, 108 Stat. 4143; Pub. L. 104–208, div. A, title II, §§ 2602, 2704(d)(1)–(4), (6)(C), (14)(H), (I), 2705, Sept. 30, 1996, 110 Stat. 3009–469, 3009–487, 3009–488, 3009–492, 3009–495; Pub. L. 104–316, title I, § 106(i), Oct. 19, 1996, 110 Stat. 3831; Pub. L. 106–102, title I, § 117, title VII, § 736(a), (b)(2), Nov. 12, 1999, 113 Stat. 1372, 1479; Pub. L. 106–400, § 2, Oct. 30, 2000, 114 Stat. 1675; Pub. L. 106–569, title XII, § 1222, Dec. 27, 2000, 114 Stat. 3036; Pub. L. 108–271, § 8(b), July 7, 2004, 118 Stat. 814; Pub. L. 108–386, § 8(a)(4), Oct. 30, 2004, 118 Stat. 2231; Pub. L. 109–8, title IX, §§ 901(a)(1), (b)(1), (c)(1), (d)(1), (e)(1), (f)(1), (g)(1), (h)(1), (i)(1), 902(a), 903(a), 904(a), 905(a), 908(a), Apr. 20, 2005, 119 Stat. 146, 147, 149, 151, 152, 155, 157–160, 165, 166, 183; Pub. L. 109–171, title II, §§ 2102(b), 2103(a)–(c), Feb. 8, 2006, 120 Stat. 9, 11; Pub. L. 109–173, §§ 2(a), (c)(1), 8(a)(11)–(14), Feb. 15, 2006, 119 Stat. 3601, 3602, 3611, 3612; Pub. L. 109–351, title VII, §§ 701(b), 718(a), 721(a), 722(a), 724, Oct. 13, 2006, 120 Stat. 1985, 1997–1999, 2001; Pub. L. 109–390, §§ 2(a)(1), (b)(1), (c)(1), 3(a), 6(a), Dec. 12, 2006, 120 Stat. 2692–2694, 2698; Pub. L. 110–289, div. A, title I, § 1161(i), title VI, § 1604(a), (c), (d), July 30, 2008, 122 Stat. 2781, 2826, 2829; Pub. L. 111–203, title III, §§ 335(a), 343(a)(1), (3), 363(5), July 21, 2010, 124 Stat. 1540, 1544, 1552; Pub. L. 111–343, § 1(a), Dec. 29, 2010, 124 Stat. 3609; Pub. L. 112–215, § 1(1), Dec. 20, 2012, 126 Stat. 1589.)

CITE AS: 12 USC 1821

§ 1821a. FSLIC Resolution Fund
(a) Established
(1) In general
(2) Transfer of FSLIC assets and liabilities
(3) Separate holding
(4) Rights, powers, and duties
(5) Corporation as conservator or receiver
(A) In general
Effective August 10, 1989, the Corporation shall succeed the Federal Savings and Loan Insurance Corporation as conservator or receiver with respect to any depository institution—
(i) the accounts of which were insured before August 10, 1989 by the Federal Savings and Loan Insurance Corporation; and
(ii) for which a conservator or receiver was appointed before January 1, 1989.
(B) Rights, powers, and duties
(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 1441b of this title or the Financing Corporation pursuant to section 1441 of this title.
(3) Amounts borrowed by the Financing Corporation pursuant to section 1441 of this title.
(c) Treasury backup
(1) In general
(2) Authorization of appropriations
(d) Legal proceedings
(e) Transfer of net proceeds from sale of RTC assets
(f) Dissolution
(Sept. 21, 1950, ch. 967, § 2[11A], as added Pub. L. 101–73, title II, § 215, Aug. 9, 1989, 103 Stat. 252; amended Pub. L. 102–233, title II, § 202(c), (d), Dec. 12, 1991, 105 Stat. 1767; Pub. L. 102–242, title I, § 161(b), Dec. 19, 1991, 105 Stat. 2285; Pub. L. 104–208, div. A, title II, § 2704(d)(14)(J)–(L), Sept. 30, 1996, 110 Stat. 3009–492; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 8(a)(15)–(17), Feb. 15, 2006, 119 Stat. 3612, 3613.)

CITE AS: 12 USC 1821a

§ 1822. Corporation as receiver
(a) Bond not required; agents; fee
(b) Payment of insured deposit as discharge from liability
(c) Recognition of claimant not on depository institution records
(d) Withholding payments to meet liability to depository institution
(e) Disposition of unclaimed deposits
(1) Notices
(A) First notice
(B) Second notice
(C) Address
(2) Transfer to appropriate State
If an insured depositor fails to make a claim for his, her, or its insured or transferred deposit within 18 months after the Corporation initiates the payment of insured deposits under section 1821(f) of this title—
(A) any transferee institution shall refund the deposit to the Corporation, and all rights of the depositor against the transferee institution shall be barred; and
(B) with the exception of United States deposits, the Corporation shall deliver the deposit to the custody of the appropriate State as unclaimed property, unless the appropriate State declines to accept custody. Upon delivery to the appropriate State, all rights of the depositor against the Corporation with respect to the deposit shall be barred and the Corporation shall be deemed to have made payment to the depositor for purposes of section 1821(g)(1) of this title.
(3) Refusal of appropriate State to accept custody
(4) Treatment of United States deposits
(5) Reversion
(6) Definitions
For purposes of this subsection—
(A) the term “transferee institution” means the insured depository institution in which the Corporation has made available a transferred deposit pursuant to section 1821(f)(1) of this title;
(B) the term “appropriate State” means the State to which notice was mailed under paragraph (1)(C), except that if the notice was not mailed to an address that is within a State it shall mean the State in which the depository institution in default has its main office; and
(C) the term “United States deposit” means an insured or transferred deposit for which the deposit records of the depository institution in default disclose that title to the deposit is held by the United States, any department, agency, or instrumentality of the Federal Government, or any officer or employee thereof in such person’s official capacity.
(f) Conflict of interest
(1) Applicability of other provisions
(A) Clarification of status of Corporation
(B) Treatment of contractors
(2) Regulations concerning employee conduct
(3) Regulations concerning independent contractors
(4) Disapproval of contractors
(A) In general
(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) becoming employed by the Corporation or otherwise 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 5 years preceding the submission of such application in which the person or a 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
(i) In general
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—
(I) all applicable information described in subparagraph (C) with respect to any such person is submitted to the Corporation; and(II) the Corporation does not disapprove of the direct or indirect employment of such person.
(ii) Finality of determination
(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 insured depository institutions; or
(iv) caused a substantial loss to the Deposit Insurance Fund (or any predecessor deposit insurance fund);
from performing any service on behalf of the Corporation.
(5) Abrogation of contracts
The Corporation may rescind any contract with a person who—
(A) fails to disclose a material fact to the Corporation;
(B) would be prohibited under paragraph (6) from providing services to, receiving fees from, or contracting with the Corporation; or
(C) has been subject to a final enforcement action by any Federal banking agency.
(6) Priority of FDIC rules
(Sept. 21, 1950, ch. 967, § 2[12], 64 Stat. 887; Pub. L. 95–369, § 6(c)(23), Sept. 17, 1978, 92 Stat. 619; Pub. L. 97–320, title I, § 113(l), Oct. 15, 1982, 96 Stat. 1474; Pub. L. 101–73, title II, §§ 201(a), 216, Aug. 9, 1989, 103 Stat. 187, 254; Pub. L. 103–44, § 1, June 28, 1993, 107 Stat. 220; Pub. L. 103–204, § 19(a), Dec. 17, 1993, 107 Stat. 2402; Pub. L. 104–179, § 4(b)(1), Aug. 6, 1996, 110 Stat. 1567; Pub. L. 109–173, § 8(a)(18), Feb. 15, 2006, 119 Stat. 3613; Pub. L. 110–289, div. A, title VI, § 1604(b)(1)(C), July 30, 2008, 122 Stat. 2829.)

CITE AS: 12 USC 1822

§ 1823. Corporation monies
(a) Investment of Corporation’s funds
(1) Authority
(2) Limitation
(b) Depository accounts
(c) Assistance to insured depository institutions
(1) The Corporation is authorized, in its sole discretion and upon such terms and conditions as the Board of Directors may prescribe, to make loans to, to make deposits in, to purchase the assets or securities of, to assume the liabilities of, or to make contributions to, any insured depository institution—
(A) if such action is taken to prevent the default of such insured depository institution;
(B) if, with respect to an insured bank in default, such action is taken to restore such insured bank to normal operation; or
(C) if, when severe financial conditions exist which threaten the stability of a significant number of insured depository institutions or of insured depository institutions possessing significant financial resources, such action is taken in order to lessen the risk to the Corporation posed by such insured depository institution under such threat of instability.
(2)
(A) In order to facilitate a merger or consolidation of another 1
1 So in original. Probably should be “an”.
insured depository institution described in subparagraph (B) with another insured depository institution or the sale of any or all of the assets of such insured depository institution or the assumption of any or all of such insured depository institution’s liabilities by another insured depository institution, or the acquisition of the stock of such insured depository institution, the Corporation is authorized, in its sole discretion and upon such terms and conditions as the Board of Directors may prescribe—
(i) to purchase any such assets or assume any such liabilities;
(ii) to make loans or contributions to, or deposits in, or purchase the securities of, such other insured depository institution or the company which controls or will acquire control of such other insured depository institution;
(iii) to guarantee such other insured depository institution or the company which controls or will acquire control of such other insured depository institution against loss by reason of such insured institution’s merging or consolidating with or assuming the liabilities and purchasing the assets of such insured depository institution or by reason of such company acquiring control of such insured depository institution; or
(iv) to take any combination of the actions referred to in subparagraphs (i) through (iii).
(B) For the purpose of subparagraph (A), the insured depository institution must be an insured depository institution—
(i) which is in default;
(ii) which, in the judgment of the Board of Directors, is in danger of default; or
(iii) which, when severe financial conditions exist which threaten the stability of a significant number of insured depository institutions or of insured depository institutions possessing significant financial resources, is determined by the Corporation, in its sole discretion, to require assistance under subparagraph (A) in order to lessen the risk to the Corporation posed by such insured depository institution under such threat of instability.
(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.
(3) The Corporation may provide any person acquiring control of, merging with, consolidating with or acquiring the assets of an insured depository institution under subsection (f) or (k) of this section with such financial assistance as it could provide an insured institution under this subsection.
(4)Least-cost resolution required.—
(A)In general.—Notwithstanding any other provision of this chapter, the Corporation may not exercise any authority under this subsection or subsection (d), (f), (h), (i), or (k) with respect to any insured depository institution unless—
(i) the Corporation determines that the exercise of such authority is necessary to meet the obligation of the Corporation to provide insurance coverage for the insured deposits in such institution; and
(ii) the total amount of the expenditures by the Corporation and obligations incurred by the Corporation (including any immediate and long-term obligation of the Corporation and any direct or contingent liability for future payment by the Corporation) in connection with the exercise of any such authority with respect to such institution is the least costly to the Deposit Insurance Fund of all possible methods for meeting the Corporation’s obligation under this section.
(B)Determining least costly approach.—In determining how to satisfy the Corporation’s obligations to an institution’s insured depositors at the least possible cost to the Deposit Insurance Fund, the Corporation shall comply with the following provisions:
(i)Present-value analysis; documentation required.—The Corporation shall—(I) evaluate alternatives on a present-value basis, using a realistic discount rate;(II) document that evaluation and the assumptions on which the evaluation is based, including any assumptions with regard to interest rates, asset recovery rates, asset holding costs, and payment of contingent liabilities; and(III) retain the documentation for not less than 5 years.
(ii)Foregone tax revenues.—Federal tax revenues that the Government would forego as the result of a proposed transaction, to the extent reasonably ascertainable, shall be treated as if they were revenues foregone by the Deposit Insurance Fund.
(C)Time of determination.—
(i)General rule.—For purposes of this subsection, the determination of the costs of providing any assistance under paragraph (1) or (2) or any other provision of this section with respect to any depository institution shall be made as of the date on which the Corporation makes the determination to provide such assistance to the institution under this section.
(ii)Rule for liquidations.—For purposes of this subsection, the determination of the costs of liquidation of any depository institution shall be made as of the earliest of—(I) the date on which a conservator is appointed for such institution;(II) the date on which a receiver is appointed for such institution; or(III) the date on which the Corporation makes any determination to provide any assistance under this section with respect to such institution.
(D)Liquidation costs.—In determining the cost of liquidating any depository institution for the purpose of comparing the costs under subparagraph (A) (with respect to such institution), the amount of such cost may not exceed the amount which is equal to the sum of the insured deposits of such institution as of the earliest of the dates described in subparagraph (C), minus the present value of the total net amount the Corporation reasonably expects to receive from the disposition of the assets of such institution in connection with such liquidation.
(E)Deposit insurance fund available for intended purpose only.—
(i)In general.—After December 31, 1994, or at such earlier time as the Corporation determines to be appropriate, the Corporation may not take any action, directly or indirectly, with respect to any insured depository institution that would have the effect of increasing losses to the Deposit Insurance Fund by protecting—(I) depositors for more than the insured portion of deposits (determined without regard to whether such institution is liquidated); or(II) creditors other than depositors.
(ii)Deadline for regulations.—The Corporation shall prescribe regulations to implement clause (i) not later than January 1, 1994, and the regulations shall take effect not later than January 1, 1995.
(iii)Purchase and assumption transactions.—No provision of this subparagraph shall be construed as prohibiting the Corporation from allowing any person who acquires any assets or assumes any liabilities of any insured depository institution for which the Corporation has been appointed conservator or receiver to acquire uninsured deposit liabilities of such institution so long as the insurance fund does not incur any loss with respect to such deposit liabilities in an amount greater than the loss which would have been incurred with respect to such liabilities if the institution had been liquidated.
(F)Discretionary determinations.—Any determination which the Corporation may make under this paragraph shall be made in the sole discretion of the Corporation.
(G)Systemic risk.—
(i)Emergency determination by secretary of the treasury.—Notwithstanding subparagraphs (A) and (E), if, upon the written recommendation of the Board of Directors (upon a vote of not less than two-thirds of the members of the Board of Directors) and the Board of Governors of the Federal Reserve System (upon a vote of not less than two-thirds of the members of such Board), the Secretary of the Treasury (in consultation with the President) determines that—(I) the Corporation’s compliance with subparagraphs (A) and (E) with respect to an insured depository institution for which the Corporation has been appointed receiver would have serious adverse effects on economic conditions or financial stability; and(II) any action or assistance under this subparagraph would avoid or mitigate such adverse effects,
the Corporation may take other action or provide assistance under this section for the purpose of winding up the insured depository institution for which the Corporation has been appointed receiver as necessary to avoid or mitigate such effects.
(ii)Repayment of loss.—(I)In general.—The Corporation shall recover the loss to the Deposit Insurance Fund arising from any action taken or assistance provided with respect to an insured depository institution under clause (i) from 1 or more special assessments on insured depository institutions, depository institution holding companies (with the concurrence of the Secretary of the Treasury with respect to holding companies), or both, as the Corporation determines to be appropriate.(II)Treatment of depository institution holding companies.—For purposes of this clause, sections 1817(c)(2) and 1828(h) of this title shall apply to depository institution holding companies as if they were insured depository institutions.(III)Regulations.—The Corporation shall prescribe such regulations as it deems necessary to implement this clause. In prescribing such regulations, defining terms, and setting the appropriate assessment rate or rates, the Corporation shall establish rates sufficient to cover the losses incurred as a result of the actions of the Corporation under clause (i) and shall consider: the types of entities that benefit from any action taken or assistance provided under this subparagraph; economic conditions, the effects on the industry, and such other factors as the Corporation deems appropriate and relevant to the action taken or the assistance provided. Any funds so collected that exceed actual losses shall be placed in the Deposit Insurance Fund.
(iii)Documentation required.—The Secretary of the Treasury shall—(I) document any determination under clause (i); and(II) retain the documentation for review under clause (iv).
(iv)GAO review.—The Comptroller General of the United States shall review and report to the Congress on any determination under clause (i), including—(I) the basis for the determination;(II) the purpose for which any action was taken pursuant to such clause; and(III) the likely effect of the determination and such action on the incentives and conduct of insured depository institutions and uninsured depositors.
(v)Notice.—(I)In general.—Not later than 3 days after making a determination under clause (i), the Secretary of the Treasury shall provide written notice of any determination under clause (i) to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Banking, Finance and Urban Affairs of the House of Representatives.(II)Description of basis of determination.—The notice under subclause (I) shall include a description of the basis for any determination under clause (i).
(H)Rule of construction.—No provision of law shall be construed as permitting the Corporation to take any action prohibited by paragraph (4) unless such provision expressly provides, by direct reference to this paragraph, that this paragraph shall not apply with respect to such action.
(5) The Corporation may not use its authority under this subsection to purchase the voting or common stock of an insured depository institution. Nothing in the preceding sentence shall be construed to limit the ability of the Corporation to enter into and enforce covenants and agreements that it determines to be necessary to protect its financial interest.
(6)
(A) During any period in which an insured depository institution has received assistance under this subsection and such assistance is still outstanding, such insured depository institution may defer the payment of any State or local tax which is determined on the basis of the deposits held by such insured depository institution or of the interest or dividends paid on such deposits.
(B) When such insured depository institution no longer has any outstanding assistance, such insured depository institution shall pay all taxes which were deferred under subparagraph (A). Such payments shall be made in accordance with a payment plan established by the Corporation, after consultation with the applicable State and local taxing authorities.
(7) 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.
(8)Assistance before appointment of conservator or receiver.—
(A)In general.—Subject to the least-cost provisions of paragraph (4), the Corporation shall consider providing direct financial assistance under this section for depository institutions before the appointment of a conservator or receiver for such institution only under the following circumstances:
(i)Troubled condition criteria.—The Corporation determines—(I) grounds for the appointment of a conservator or receiver exist or likely will exist in the future unless the depository institution’s capital levels are increased; and(II) it is unlikely that the institution can meet all currently applicable capital standards without assistance.
(ii)Other criteria.—The depository institution meets the following criteria:(I) The appropriate Federal banking agency and the Corporation have determined that, during such period of time preceding the date of such determination as the agency or the Corporation considers to be relevant, the institution’s management has been competent and has complied with applicable laws, rules, and supervisory directives and orders.(II) The institution’s management did not engage in any insider dealing, speculative practice, or other abusive activity.
(B)Public disclosure.—Any determination under this paragraph to provide assistance under this section shall be made in writing and published in the Federal Register.
(9) Any assistance provided under this subsection may be in subordination to the rights of depositors and other creditors.
(10) In its annual report to the Congress, the Corporation shall report the total amount it has saved, or estimates it has saved, by exercising the authority provided in this subsection.
(11)Unenforceability of certain agreements.—No provision contained in any existing or future standstill, confidentiality, or other agreement that, directly or indirectly—
(A) affects, restricts, or limits the ability of any person to offer to acquire or acquire,
(B) prohibits any person from offering to acquire or acquiring, or
(C) prohibits any person from using any previously disclosed information in connection with any such offer to acquire or acquisition of,
all or part of any insured depository institution, including any liabilities, assets, or interest therein, in connection with any transaction in which the Corporation exercises its authority under section 1821 of this title or this section, shall be enforceable against or impose any liability on such person, as such enforcement or liability shall be contrary to public policy.
(d) Sale of assets to Corporation
(1) In general
(2) Proceeds
(3) Rights and powers of Corporation
(A) In general
(B) Rule of construction
(C) Fiduciary responsibility
(D) Disposition of assetsIn exercising any right, power, privilege, or authority described in subparagraph (A) regarding the sale or disposition of assets sold to the Corporation pursuant to paragraph (1), the Corporation shall conduct its operations in a manner which—
(i) maximizes the net present value return from the sale or disposition of such assets;
(ii) minimizes the amount of any loss realized in the resolution of cases;
(iii) ensures adequate competition and fair and consistent treatment of offerors;
(iv) prohibits discrimination on the basis of race, sex, or ethnic groups in the solicitation and consideration of offers; and
(v) maximizes the preservation of the availability and affordability of residential real property for low- and moderate-income individuals.
(4) Loans
(e) Agreements against interests of Corporation
(1) In generalNo agreement which tends to diminish or defeat the interest of the Corporation in any asset acquired by it under this section or section 1821 of this title, 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—
(A) is in writing,
(B) 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,
(C) 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
(D) has been, continuously, from the time of its execution, an official record of the depository institution.
(2) Exemptions from contemporaneous execution requirementAn agreement to provide for the lawful collateralization of—
(A) deposits of, or other credit extension by, a Federal, State, or local governmental entity, or of any depositor referred to in section 1821(a)(2) of this title, including an agreement to provide collateral in lieu of a surety bond;
(B) bankruptcy estate funds pursuant to section 345(b)(2) of title 11;
(C) extensions of credit, including any overdraft, from a Federal reserve bank or Federal home loan bank; or
(D) one or more qualified financial contracts, as defined in section 1821(e)(8)(D) of this title,
shall not be deemed invalid pursuant to paragraph (1)(B) solely because such agreement was not executed contemporaneously with the acquisition of the collateral or because of pledges, delivery, or substitution of the collateral made in accordance with such agreement.
(f) Assisted emergency interstate acquisitions
(1) This subsection shall apply only to an acquisition of an insured bank or a holding company by an out-of-State bank 2
2 So in original. Probably should be followed by “or”.
savings association or out-of-State holding company for which the Corporation provides assistance under subsection (c).
(2)
(A) Whenever an insured bank with total assets of $500,000,000 or more (as determined from its most recent report of condition) is in default, the Corporation, as receiver, may, in its discretion and upon such terms and conditions as the Corporation may determine, arrange the sale of assets of the bank in default and the assumption of the liabilities of the bank in default, including the sale of such assets to and the assumption of such liabilities by an insured depository institution located in the State where the bank in default was chartered but established by an out-of-State bank or holding company. Where otherwise lawfully required, a transaction under this subsection must be approved by the primary Federal or State supervisor of all parties thereto.
(B)
(i) Before making a determination to take any action under subparagraph (A), the Corporation shall consult the State bank supervisor of the State in which the insured bank in default was chartered.
(ii) The State bank supervisor shall be given a reasonable opportunity, and in no event less than forty-eight 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) If the State supervisor objects during such period, the Corporation may use the authority of this paragraph only by a vote of 75 percent of the Board of Directors. The Board of Directors shall provide to the State supervisor, as soon as practicable, a written certification of its determination.
(3)Emergency Interstate Acquisitions of Insured Banks in Danger of Default.—
(A)Acquisition of insured banks in danger of default.—One or more out-of-State banks or out-of-State holding companies may acquire and retain all or part of the shares or assets of, or otherwise acquire and retain—
(i) an insured bank in danger of default which has total assets of $500,000,000 or more; or
(ii) 2 or more affiliated insured banks in danger of default which have aggregate total assets of $500,000,000 or more, if the aggregate total assets of such banks is equal to or greater than 33 percent of the aggregate total assets of all affiliated insured banks.
(B)Acquisition of a holding company or other bank affiliate.—If one or more out-of-State banks or out-of-State holding companies acquire 1 or more affiliated insured banks under subparagraph (A) the aggregate total assets of which is equal to or greater than 33 percent of the aggregate total assets of all affiliated insured banks, any such out-of-State bank or out-of-State holding company may also, as part of the same transaction, acquire and retain the shares or assets of, or otherwise acquire and retain—
(i) the holding company which controls the affiliated insured banks so acquired; or
(ii) any other affiliated insured bank.
(C)Request for assistance by corporate board of directors.—The Corporation may assist an acquisition or merger authorized under subparagraph (A) only if the board of directors or trustees of each insured bank in danger of default which is being acquired has requested in writing that the Corporation assist the acquisition or merger.
(D)Certain acquisitions authorized after assistance is provided.—Notwithstanding paragraph (1), if—
(i) at any time after August 10, 1987, the Corporation provides any assistance under subsection (c) to an insured bank; and
(ii) at the time such assistance is granted, the insured bank, the holding company which controls the insured bank (if any), or any affiliated insured bank is eligible to be acquired by an out-of-State bank or out-of-State holding company under this paragraph,
the insured bank, the holding company, and such other affiliated insured bank shall remain eligible, subject to such terms and conditions as the Corporation (in the Corporation’s discretion) may impose, to be acquired by an out-of-State bank or out-of-State holding company under this paragraph as long as any portion of such assistance remains outstanding.
(E)State bank supervisor approval.—The Corporation may take no final action in connection with any acquisition under this paragraph unless the State bank supervisor of the State in which the bank in danger of default is located approves the acquisition.
(F)Other requirements not affected.—This paragraph does not affect any other requirement under Federal or State law for regulatory approval of an acquisition under this paragraph.
(G)Acquisition may be conditioned on receipt of consideration for corporation’s assistance.—Any acquisition described in subparagraph (D) may be conditioned on the receipt of such consideration for the Corporation’s assistance as the Board of Directors deems appropriate.
(4)
(A)Acquisitions Not Subject to Certain Other Laws.—
(B) Any subsidiary created by operation of this subsection may retain and operate any existing branch or branches of the institution merged with or acquired under paragraph (2) or (3), but otherwise shall be subject to the conditions upon which a national bank may establish and operate branches in the State in which such insured institution is located.
(C) No insured institution acquired under this subsection shall after it is acquired move its principal office or any branch office which it would be prohibited from moving if the institution were a national bank.
(D)Subsequent Nonemergency Interstate Acquisitions Subject to State Law.—
(i)In general.—Any out-of-State bank holding company which acquires control of an insured bank in any State under paragraph (2) or (3) may acquire any other insured bank and establish branches in such State to the same extent as a bank holding company whose insured bank subsidiaries’ operations are principally conducted in such State may acquire any other insured bank or establish branches.
(ii)Delayed date of applicability.—Clause (i) shall not apply with respect to any out-of-State bank holding company referred to in such clause before the earlier of—(I) the end of the 2-year period beginning on the date the acquisition referred to in such clause with respect to such company is consummated; or(II) the end of any period established under State law during which such out-of-State bank holding company may not be treated as a bank holding company whose insured bank subsidiaries’ operations are principally conducted in such State for purposes of acquiring other insured banks or establishing bank branches.
(iii)Determination of principally conducted.—For purposes of this subparagraph, the State in which the operations of a holding company’s insured bank subsidiaries are principally conducted is the State determined under section 1842(d) of this title with respect to such holding company.
(E)Certain State Interstate Banking Laws Inapplicable.—Any holding company which acquires control of any insured bank or holding company under paragraph (2) or (3) or subparagraph (D) of this paragraph shall not, by reason of such acquisition, be required under the law of any State to divest any other insured bank or be prevented from acquiring any other bank or holding company.
(5) In determining whether to arrange a sale of assets and assumption of liabilities or an acquisition or a merger under the authority of paragraph (2) or (3), 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 bank in default or the bank in danger of default.
(6)
(A) If, after receiving offers, the offer presenting the lowest expense to the Corporation, that is in a form and with conditions acceptable to the Corporation (hereinafter referred to as the “lowest acceptable offer”), is from an offeror that is not an existing in-State bank of the same type as the bank that is in default or is in danger of default (or, where the bank is an insured bank other than a mutual savings bank, the lowest acceptable offer is not from an in-State holding company), the Corporation shall permit the offeror which made the initial lowest acceptable offer and each offeror who made an offer the estimated cost of which to the Corporation was within 15 per centum or $15,000,000, whichever is less, of the initial lowest acceptable offer to submit a new offer.
(B) In considering authorizations under this subsection, the Corporation shall give consideration to the need to minimize the cost of financial assistance and to the maintenance of specialized depository institutions. The Corporation shall authorize transactions under this subsection considering the following priorities:
(i) First, between depository institutions of the same type within the same State.
(ii) Second, between depository institutions of the same type—(I) in different States which by statute specifically authorize such acquisitions; or(II) in the absence of such statutes, in different States which are contiguous.
(iii) Third, between depository institutions of the same type in different States other than the States described in clause (ii).
(iv) Fourth, between depository institutions of different types in the same State.
(v) Fifth, between depository institutions of different types—(I) in different States which by statute specifically authorize such acquisitions; or(II) in the absence of such statutes, in different States which are contiguous.
(vi) Sixth, between depository institutions of different types in different States other than the States described in clause (v).
(C)Minority Bank Priority.—In the case of a minority-controlled bank, the Corporation shall seek an offer from other minority-controlled banks before proceeding with the bidding priorities set forth in subparagraph (B).
(D) In determining the cost of offers and reoffers, the Corporation’s calculations and estimations shall be determinative. The Corporation may set reasonable time limits on offers and reoffers.
(7) No sale may be made under the provisions of paragraph (2) or (3)—
(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 business of banking in any part of the United States;
(B) whose effect in any section of the country may be substantially to lessen competition, or to tend to create a monopoly, or which in any other manner would be in restraint of trade, unless the Corporation finds that the anticompetitive effects of the proposed transactions are clearly outweighed in the public interest by the probable effect of the transaction in meeting the convenience and needs of the community to be served; or
(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.
(8) As used in this subsection—
(A) the term “in-State depository institution or in-State holding company” means an existing insured depository institution currently operating in the State in which the bank in default or the bank in danger of default is chartered or a company that is operating an insured depository institution subsidiary in the State in which the bank in default or the bank in danger of default is chartered;
(B) the term “acquire” means to acquire, directly or indirectly, ownership or control through—
(i) an acquisition of shares;
(ii) an acquisition of assets or assumption of liabilities;
(iii) a merger or consolidation; or
(iv) any similar transaction;
(C) the term “affiliated insured bank” means—
(i) when used in connection with a reference to a holding company, an insured bank which is a subsidiary of such holding company; and
(ii) when used in connection with a reference to 2 or more insured banks, insured banks which are subsidiaries of the same holding company; and
(D) the term “subsidiary” has the meaning given to such term in section 1841(d) of this title.
(9)No Assistance Authorized for Certain Subsidiaries of Holding Companies.—
(A)In general.—The Corporation shall not provide any assistance to a subsidiary, other than a subsidiary that is an insured depository institution, of a holding company in connection with any acquisition under this subsection.
(B)Intermediate holding company permitted.—This paragraph does not prohibit an intermediate holding company or an affiliate of an insured depository institution from being a conduit for assistance ultimately intended for an insured bank.
(10)Annual Report.—
(A)Required.—In its annual report to Congress the Corporation shall include a report on the acquisitions under this subsection during the preceding year.
(B)Contents.—The report required under subparagraph (A) shall contain the following information:
(i) The number of acquisitions under this subsection.
(ii) A brief description of each such acquisition and the circumstances under which such acquisition occurred.
(11)Determination of Total Assets.—For purposes of this subsection, the total assets of any insured bank shall be determined on the basis of the most recent report of condition of such bank which is available at the time of such determination.
(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 are 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 461(b)(1)(A) of this title—(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.
(g) Payment of interest on stock subscriptions
(h) Reopening or aversion of closing of insured branch of foreign bank
(i) Repealed. Pub. L. 97–320, title II, § 206, Oct. 15, 1982, 96 Stat. 1496
(j) Loan loss amortization for certain banks
(1) EligibilityThe appropriate Federal banking agency shall permit an agricultural bank to take the actions referred to in paragraph (2) if it finds that—
(A) there is no evidence that fraud or criminal abuse on the part of the bank led to the losses referred to in paragraph (2); and
(B) the agricultural bank has a plan to restore its capital, not later than the close of the amortization period established under paragraph (2), to a level prescribed by the appropriate Federal banking agency.
(2) Seven-year loss amortization
(A) Any loss on any qualified agricultural loan that an agricultural bank would otherwise be required to show on its annual financial statement for any year between December 31, 1983, and January 1, 1992, may be amortized on its financial statements over a period of not to exceed 7 years, as provided in regulations issued by the appropriate Federal banking agency.
(B) An agricultural bank may reappraise any real estate or other property, real or personal, that it acquired coincident to the making of a qualified agricultural loan and that it owned on January 1, 1983, and any such additional property that it acquires prior to January 1, 1992. Any loss that such bank would otherwise be required to show on its annual financial statements as the result of any such reappraisal may be amortized on its financial statements over a period of not to exceed 7 years, as provided in regulations issued by the appropriate Federal banking agency.
(3) Regulations
(4) DefinitionsAs used in this subsection—
(A) the term “agricultural bank” means a bank—
(i) the deposits of which are insured by the Federal Deposit Insurance Corporation;
(ii) which is located in an area the economy of which is dependent on agriculture;
(iii) which has assets of $100,000,000 or less; and
(iv) which has—(I) at least 25 percent of its total loans in qualified agricultural loans; or(II) fewer than 25 percent of its total loans in qualified agricultural loans but which the appropriate Federal banking agency or State bank commissioner recommends to the Corporation for eligibility under this section, or which the Corporation, on its motion, deems eligible; and
(B) the term “qualified agricultural loan” means a loan made to finance the production of agricultural products or livestock in the United States, a loan secured by farmland or farm machinery, or such other category of loans as the appropriate Federal banking agency may deem eligible.
(5) Maintenance of portfolio
(k) Emergency acquisitions
(1) In general
(A) Acquisitions authorized
(i) Transactions describedNotwithstanding 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
(iii) Approval by appropriate agency
(iv) Acquisitions by savings associations
(v) Dual service
(vi) Continued applicability of certain State restrictions
(B) Consultation with State official
(i) Consultation required
(ii) Period for State response
(iii) Approval over objection of State official
(2) Solicitation of offers
(A) In general
(B) Minority-controlled institutions
(3) Determination of costs
(4) Branching provisions
(A) In general
(B) Restrictions
(i) In generalNotwithstanding 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 title 26, 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 is located.
(ii) Transition period
(5) Assistance before appointment of conservator or receiver
(A) Assistance proposalsThe Corporation shall consider proposals by savings associations 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 criteriaThe 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 criteriaThe member meets the following criteria:(I) Before August 9, 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 1467a(m) of this title) 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
(C) “Economically depressed region” defined
(Sept. 21, 1950, ch. 967, § 2[13], 64 Stat. 888; Pub. L. 95–369, § 6(c)(24), Sept. 17, 1978, 92 Stat. 619; Pub. L. 97–320, title I, §§ 111, 113(m), 116, 141(a)(1), (3), title II, §§ 203, 206, Oct. 15, 1982, 96 Stat. 1469, 1474, 1476, 1488, 1489, 1492, 1496; Pub. L. 97–457, §§ 1(a), 4, 10(a), Jan. 12, 1983, 96 Stat. 2507, 2508; Pub. L. 98–29, § 1(a), May 16, 1983,

CITE AS: 12 USC 1823

§ 1824. Borrowing authority
(a) Borrowing from Treasury
(1) In general
(2) Funding
(3) Temporary increases authorized
(A) Recommendations for increase
(B) Report required
(C) Restriction on usage
(b) Borrowing from Federal Financing Bank
(c) Repayment schedules required for any borrowing
(1) In general
No amount may be provided by the Secretary of the Treasury to the Corporation under subsection (a) unless an agreement is in effect between the Secretary and the Corporation which—
(A) provides a schedule for the repayment of the outstanding amount of any borrowing under such subsection; and
(B) demonstrates that income to the Corporation from assessments under this chapter will be sufficient to amortize the outstanding balance within the period established in the repayment schedule and pay the interest accruing on such balance.
(2) Consultation with and report to Congress
The Secretary of the Treasury and the Corporation shall—
(A) consult with 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 on the terms of any repayment schedule agreement described in paragraph (1) relating to repayment, including terms relating to any emergency special assessment under section 1817(b)(7) of this title; and
(B) submit a copy of each repayment schedule agreement entered into under paragraph (1) 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 before the end of the 30-day period beginning on the date any amount is provided by the Secretary of the Treasury to the Corporation under subsection (a).
(d) Borrowing for the Deposit Insurance Fund from insured depository institutions
(1) Borrowing authority
The Corporation may issue obligations to insured depository institutions, and may borrow from insured depository institutions and give security for any amount borrowed, and may pay interest on (and any redemption premium with respect to) any such obligation or amount to the extent—
(A) the proceeds of any such obligation or amount are used by the Corporation solely for purposes of carrying out the Corporation’s functions with respect to the Deposit Insurance Fund; and
(B) the terms of the obligation or instrument limit the liability of the Corporation or the Deposit Insurance Fund for the payment of interest and the repayment of principal to the amount which is equal to the amount of assessment income received by the Fund from assessments under section 1817 of this title.
(2) Limitations on borrowing
(A) Applicability of public debt limit
(B) Applicability of FDIC borrowing limit
(C) Interest rate limit
(D) Obligations to be held only by BIF members 1
1 So in original. Probably should be “insured depository institutions”.
(3) Liability of the Deposit Insurance Fund
(4) Terms and conditions
(5) Investment by insured depository institutions
(A) Authority to invest
(B) Investment only from capital and retained earnings
(6) Accounting treatment
(e) Borrowing for the Deposit Insurance Fund from Federal home loan banks
(1) In general
(2) Terms and conditions
Any loan from any Federal home loan bank under paragraph (1) to the Deposit Insurance Fund shall—
(A) bear a rate of interest of not less than the current marginal cost of funds to that bank, taking into account the maturities involved;
(B) be adequately secured, as determined by the Federal Housing Finance Board;
(C) be a direct liability of the Deposit Insurance Fund; and
(D) be subject to the limitations of section 1825(c) of this title.
(Sept. 21, 1950, ch. 967, § 2[14], 64 Stat. 890; Pub. L. 101–73, title II, § 218, Aug. 9, 1989, 103 Stat. 261; Pub. L. 101–508, title II, § 2005, Nov. 5, 1990, 104 Stat. 1388–16; Pub. L. 102–242, title I, §§ 101, 103(a), 105, Dec. 19, 1991, 105 Stat. 2236, 2237, 2239; Pub. L. 102–550, title XVI, § 1603(a)(2), Oct. 28, 1992, 106 Stat. 4078; Pub. L. 103–204, § 10, Dec. 17, 1993, 107 Stat. 2389; Pub. L. 104–208, div. A, title II, § 2704(d)(14)(N)–(Q), Sept. 30, 1996, 110 Stat. 3009–493; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 8(a)(20)–(24), Feb. 15, 2006, 119 Stat. 3613, 3614; Pub. L. 111–22, div. A, title II, § 204(c)(1), May 20, 2009, 123 Stat. 1649.)

CITE AS: 12 USC 1824

§ 1825. Issuance of notes, debentures, bonds, and other obligations; exemptions
(a) General rule
(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.
(4)Exemption from criminal prosecution.—The Corporation shall be exempt from all prosecution by the United States or any State, county, municipality, or local authority for any criminal offense arising under Federal, State, county, municipal, or local law, which was allegedly committed by the institution, or persons acting on behalf of the institution, prior to the appointment of the Corporation as receiver.
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, guarantees, and liabilities
(2) Estimate of notes and other obligations required
(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) Maximum amount limitation on outstanding obligations
Notwithstanding any other provisions of this chapter, the Corporation may not issue or incur any obligation, if, after issuing or incurring the obligation, the aggregate amount of obligations of the Deposit Insurance Fund, outstanding would exceed the sum of—
(A) the amount of cash or the equivalent of cash held by the Deposit Insurance Fund;
(B) the amount which is equal to 90 percent of the Corporation’s estimate of the fair market value of assets held by the Deposit Insurance Fund, other than assets described in subparagraph (A); and
(C) the total of the amounts authorized to be borrowed from the Secretary of the Treasury pursuant to section 1824(a) of this title.
(6) “Obligation” defined
(A) In general
For purposes of paragraph (5), the term “obligation” includes—
(i) any guarantee issued by the Corporation, other than deposit guarantees;
(ii) any amount borrowed pursuant to section 1824 of this title; and
(iii) any other obligation for which the Corporation has a direct or contingent liability to pay any amount.
(B) Valuation of contingent liabilities
(d) Full faith and credit
The full faith and credit of the United States is pledged to the payment of any obligation issued after August 9, 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.
(Sept. 21, 1950, ch. 967, § 2[15], 64 Stat. 890; Pub. L. 101–73, title II, § 219, Aug. 9, 1989, 103 Stat. 261; Pub. L. 102–242, title I, § 102(a), (c), Dec. 19, 1991, 105 Stat. 2236, 2237; Pub. L. 103–325, title VI, § 602(a)(43), Sept. 23, 1994, 108 Stat. 2290; Pub. L. 104–208, div. A, title II, § 2704(d)(14)(R), Sept. 30, 1996, 110 Stat. 3009–493; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 8(a)(25), Feb. 15, 2006, 119 Stat. 3614; Pub. L. 109–351, title VII, § 720(a), Oct. 13, 2006, 120 Stat. 1998.)

CITE AS: 12 USC 1825

§ 1826. Forms of obligations; preparation by Secretary of the Treasury

In order that the Corporation may be supplied with such forms of notes, debentures, bonds, or other such obligations as it may need for issuance under this chapter, the Secretary of the Treasury is authorized to prepare such forms as shall be suitable and approved by the Corporation, to be held in the Treasury subject to delivery, upon order of the Corporation. The engraved plates, dies, bed pieces, and other material executed in connection therewith shall remain in the custody of the Secretary of the Treasury. The Corporation shall reimburse the Secretary of the Treasury for any expenses incurred in the preparation, custody, and delivery of such notes, debentures, bonds, or other such obligations.

(Sept. 21, 1950, ch. 967, § 2[16], 64 Stat. 890.)

CITE AS: 12 USC 1826

§ 1827. Reports by Corporation; audit of financial transactions; report on audits; employment of certified public accountants for audits
(a) Annual reports on the Deposit Insurance Fund 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 Deposit 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 the Deposit 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 Deposit Insurance Fund or the FSLIC Resolution Fund to achieve the purposes of this chapter; 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
(3) Coordination with other report requirements
(b) Quarterly reports to Treasury
(1) Financial operating plans and forecasts
(2) Financial condition and reports of operations
(3) Items to be included
(4) Rule of construction
(c) Reports to OMB
(1) Financial information
(2) Financial operating plans and forecasts
(3) Rule of construction
(d) Audit
(1) Audit required
(2) Access to books and records
(e) Audit of Corporation
(f) Report of audit
(g) Assistance in audit; costs
(Sept. 21, 1950, ch. 967, § 2[17], 64 Stat. 890; Pub. L. 93–604, title VI, § 602, Jan. 2, 1975, 88 Stat. 1963; Pub. L. 101–73, title II, § 220(a), Aug. 9, 1989, 103 Stat. 263; Pub. L. 102–242, title IV, § 427, Dec. 19, 1991, 105 Stat. 2378; Pub. L. 104–208, div. A, title II, § 2704(d)(14)(S), (T), Sept. 30, 1996, 110 Stat. 3009–493, 3009–494; Pub. L. 106–569, title XI, §§ 1103(a), 1104(b), Dec. 27, 2000, 114 Stat. 3030, 3032; Pub. L. 108–271, § 8(b), July 7, 2004, 118 Stat. 814; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 8(a)(26), (27), Feb. 15, 2006, 119 Stat. 3614, 3615.)

CITE AS: 12 USC 1827

§ 1828. Regulations governing insured depository institutions
(a) Representations of deposit insurance
(1) Insured depository institutions
(A) In general
(B) Statement to be included
(2) Regulations
(3) Penalties
(4) False advertising, misuse of FDIC names, and misrepresentation to indicate insured status
(A) Prohibition on false advertising and misuse of FDIC namesNo person may represent or imply that any deposit liability, obligation, certificate, or share is insured or guaranteed by the Corporation, if such deposit liability, obligation, certificate, or share is not insured or guaranteed by the Corporation—
(i) by using the terms “Federal Deposit”, “Federal Deposit Insurance”, “Federal Deposit Insurance Corporation”, any combination of such terms, or the abbreviation “FDIC” as part of the business name or firm name of any person, including any corporation, partnership, business trust, association, or other business entity; or
(ii) by using such terms or any other terms, sign, or symbol as part of an advertisement, solicitation, or other document.
(B) Prohibition on misrepresentations of insured statusNo person may knowingly misrepresent—
(i) that any deposit liability, obligation, certificate, or share is insured, under this chapter, if such deposit liability, obligation, certificate, or share is not so insured; or
(ii) the extent to which or the manner in which any deposit liability, obligation, certificate, or share is insured under this chapter, if such deposit liability, obligation, certificate, or share is not so insured, to the extent or in the manner represented.
(C) Authority of the appropriate Federal banking agency
(D) Corporation authority if the appropriate Federal banking agency fails to follow recommendation
(i) Recommendation
(ii) Agency response
(E) Additional authorityIn addition to its authority under subparagraphs (C) and (D), for purposes of this paragraph, the Corporation shall have, in the same manner and to the same extent as with respect to a State nonmember insured bank—
(i) jurisdiction over—(I) any person other than a person for which another agency is the appropriate Federal banking agency or any institution-affiliated party thereof; and(II) any person that aids or abets a violation of this paragraph by a person described in subclause (I); and
(ii) for purposes of enforcing the requirements of this paragraph, the authority of the Corporation under—(I)section 1820(c) of this title to conduct investigations; and(II) subsections (b), (c), (d) and (i) of section 1818 of this title to conduct enforcement actions.
(F) Other actions preserved
(b) Payment of dividends by defaulting depository institutions
(c) Merger transactions; consent of banking agencies; emergency approval; notice; uniform standards; antitrust actions; review de novo; limitations; report to Congress; money laundering; applicability
(1) Except with the prior written approval of the responsible agency, which shall in every case referred to in this paragraph be the Corporation, no insured depository institution shall—
(A) merge or consolidate with any noninsured bank or institution;
(B) assume liability to pay any deposits (including liabilities which would be “deposits” except for the proviso in section 1813(l)(5) of this title) made in, or similar liabilities of, any noninsured bank or institution; or
(C) transfer assets to any noninsured bank or institution in consideration of the assumption of liabilities for any portion of the deposits made in such insured depository institution.
(2) No insured depository institution shall merge or consolidate with any other insured depository institution or, either directly or indirectly, acquire the assets of, or assume liability to pay any deposits made in, any other insured depository institution except with the prior written approval of the responsible agency, which shall be—
(A) the Comptroller of the Currency if the acquiring, assuming, or resulting bank is to be a national bank or a Federal savings association;
(B) the Board of Governors of the Federal Reserve System if the acquiring, assuming, or resulting bank is to be a State member bank; and
(C) the Corporation if the acquiring, assuming, or resulting bank is to be a State nonmember insured bank or a State savings association.
(3) Notice of any proposed transaction for which approval is required under paragraph (1) or (2) (referred to hereafter in this subsection as a “merger transaction”) shall, unless the responsible agency finds that it must act immediately in order to prevent the probable default of one of the banks or savings associations involved, be published—
(A) prior to the granting of approval of such transaction,
(B) in a form approved by the responsible agency,
(C) at appropriate intervals during a period at least as long as the period allowed for furnishing reports under paragraph (4) of this subsection, and
(D) in a newspaper of general circulation in the community or communities where the main offices of the banks or savings associations involved are located, or, if there is no such newspaper in any such community, then in the newspaper of general circulation published nearest thereto.
(4)Reports on competitive factors.—
(A)Request for report.—In the interests of uniform standards and subject to subparagraph (B), before acting on any application for approval of a merger transaction, the responsible agency shall—
(i) request a report on the competitive factors involved from the Attorney General of the United States; and
(ii) provide a copy of the request to the Corporation (when the Corporation is not the responsible agency).
(B)Furnishing of report.—The report requested under subparagraph (A) shall be furnished by the Attorney General to the responsible agency—
(i) not later than 30 calendar days after the date on which the Attorney General received the request; or
(ii) not later than 10 calendar days after such date, if the requesting agency advises the Attorney General that an emergency exists requiring expeditious action.
(C)Exceptions.—A responsible agency may not be required to request a report under subparagraph (A) if—
(i) the responsible agency finds that it must act immediately in order to prevent the probable failure of 1 of the insured depository institutions involved in the merger transaction; or
(ii) the merger transaction involves solely an insured depository institution and 1 or more of the affiliates of such depository institution.
(5) The responsible agency shall not approve—
(A) any proposed merger transaction 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 business of banking in any part of the United States, or
(B) any other proposed merger transaction whose effect in any section of the country may be substantially to lessen competition, or to 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 transaction are clearly outweighed in the public interest by the probable effect of the transaction in meeting the convenience and needs of the community to be served.
In every case, the responsible agency shall take into consideration the financial and managerial resources and future prospects of the existing and proposed institutions, the convenience and needs of the community to be served, and the risk to the stability of the United States banking or financial system.
(6) The responsible agency shall immediately notify the Attorney General of any approval by it pursuant to this subsection of a proposed merger transaction. If the agency has found that it must act immediately to prevent the probable failure of one of the insured depository institutions involved, or if the proposed merger transaction is solely between an insured depository institution and 1 or more of its affiliates, and the report on the competitive factors has been dispensed with, the transaction may be consummated immediately upon approval by the agency. If the agency has advised the Attorney General under paragraph (4)(B)(ii) of the existence of an emergency requiring expeditious action and has requested a report on the competitive factors within 10 days, the transaction may not be consummated before the fifth calendar day after the date of approval by the agency. In all other cases, the transaction may not be consummated before the thirtieth calendar day after the date of approval by the agency or, if the agency has not received any adverse comment from the Attorney General of the United States relating to competitive factors, such shorter period of time as may be prescribed by the agency with the concurrence of the Attorney General, but in no event less than 15 calendar days after the date of approval.
(7)
(A) Any action brought under the antitrust laws arising out of a merger transaction shall be commenced prior to the earliest time under paragraph (6) at which a merger transaction approved under paragraph (5) might be consummated. The commencement of such an action shall stay the effectiveness of the agency’s approval unless the court shall otherwise specifically order. In any such action, the court shall review de novo the issues presented.
(B) In any judicial proceeding attacking a merger transaction approved under paragraph (5) on the ground that the merger transaction alone and of itself constituted a violation of any antitrust laws other than section 2 of title 15, the standards applied by the court shall be identical with those that the banking agencies are directed to apply under paragraph (5).
(C) Upon the consummation of a merger transaction in compliance with this subsection and after the termination of any antitrust litigation commenced within the period prescribed in this paragraph, or upon the termination of such period if no such litigation is commenced therein, the transaction may not thereafter be attacked in any judicial proceeding on the ground that it alone and of itself constituted a violation of any antitrust laws other than section 2 of title 15, but nothing in this subsection shall exempt any bank or savings association resulting from a merger transaction from complying with the antitrust laws after the consummation of such transaction.
(D) In any action brought under the antitrust laws arising out of a merger transaction approved by a Federal supervisory agency pursuant to this subsection, such agency, and any State banking supervisory agency having jurisdiction within the State involved, may appear as a part of its own motion and as of right, and be represented by its counsel.
(8) For the purposes of this subsection, the term “antitrust laws” means the Act of July 2, 1890 (the Sherman Antitrust Act), the Act of October 15, 1914 (the Clayton Act), and any other Acts in pari materia.
(9) Each of the responsible agencies shall include in its annual report to the Congress a description of each merger transaction approved by it during the period covered by the report, along with—
(A) the name and total resources of each bank or savings association involved;
(B) whether a report was submitted by the Attorney General under paragraph (4), and, if so, a summary by the Attorney General of the substance of such report; and
(C) a statement by the responsible agency of the basis for its approval.
(10) Until June 30, 1976, the responsible agency shall not grant any approval required by law which has the practical effect of permitting a conversion from the mutual to the stock form of organization, including approval of any application pending on the date of enactment of this subsection, except that this sentence shall not be deemed to limit now or hereafter the authority of the responsible agency to grant approvals in cases where the responsible agency finds that it must act in order to maintain the safety, soundness, and stability of an insured depository institution. The responsible agency may by rule, regulation, or otherwise and under such civil penalties (which shall be cumulative to any other remedies) as it may prescribe take whatever action it deems necessary or appropriate to implement or enforce this subsection.
(11)Money laundering.—In every case, the responsible agency, shall take into consideration the effectiveness of any insured depository institution involved in the proposed merger transaction in combatting money laundering activities, including in overseas branches.
(12) The provisions of this subsection do not apply to any merger transaction involving a foreign bank if no party to the transaction is principally engaged in business in the United States.
(13)
(A) Except as provided in subparagraph (B), the responsible agency may not approve an application for an interstate merger transaction if the resulting insured depository institution (including all insured depository institutions which are affiliates of the resulting insured depository institution), upon consummation of the transaction, would control more than 10 percent of the total amount of deposits of insured depository institutions in the United States.
(B) Subparagraph (A) shall not apply to an interstate merger transaction that involves 1 or more insured depository institutions in default or in danger of default, or with respect to which the Corporation provides assistance under section 1823 of this title.
(C) In this paragraph—
(i) the term “interstate merger transaction” means a merger transaction involving 2 or more insured depository institutions that have different home States and that are not affiliates; and
(ii) the term “home State” means—(I) with respect to a national bank, the State in which the main office of the bank is located;(II) with respect to a State bank or State savings association, the State by which the State bank or State savings association is chartered; and(III) with respect to a Federal savings association, the State in which the home office (as defined by the regulations of the Director of the Office of Thrift Supervision, or, on and after the transfer date,1
1 See References in Text note below.
the Comptroller of the Currency) of the Federal savings association is located.
(d) Branch banks
(1) No State nonmember insured bank shall establish and operate any new domestic branch unless it shall have the prior written consent of the Corporation, and no State nonmember insured bank shall move its main office or any such branch from one location to another without such consent. No foreign bank may move any insured branch from one location to another without such consent. The factors to be considered in granting or withholding the consent of the Corporation under this subsection shall be those enumerated in section 1816 of this title.
(2) No State nonmember insured bank shall establish or operate any foreign branch, except with the prior written consent of the Corporation and upon such conditions and pursuant to such regulations as the Corporation may prescribe from time to time.
(3)Exclusive authority for additional branches.—
(A)In general.—Effective June 1, 1997, a State nonmember bank may not acquire, establish, or operate a branch in any State other than the bank’s home State (as defined in section 1831u(f)(4) 1 of this title) or a State in which the bank already has a branch unless the acquisition, establishment, or operation of a branch in such State by a State nonmember bank is authorized under this subsection or section 1823(f), 1823(k), or 1831u of this title.
(B)Retention of branches.—In the case of a State nonmember bank which relocates the main office of such bank from 1 State to another State after May 31, 1997, the bank may retain and operate branches within the State which was the bank’s home State (as defined in section 1831u(f)(4) 1 of this title) before the relocation of such office only to the extent the bank would be authorized, under this section or any other provision of law referred to in subparagraph (A), to acquire, establish, or commence to operate a branch in such State if—
(i) the bank had no branches in such State; or
(ii) the branch resulted from—(I) an interstate merger transaction approved pursuant to section 1831u of this title; or(II) a transaction after May 31, 1997, pursuant to which the bank received assistance from the Corporation under section 1823(c) of this title.
(4)State “opt-in” election to permit interstate branching through de novo branches.—
(A)In general.—Subject to subparagraph (B), the Corporation may approve an application by an insured State nonmember bank to establish and operate a de novo branch in a State (other than the bank’s home State) in which the bank does not maintain a branch if—
(i) the law of the State in which the branch is located, or is to be located, would permit establishment of the branch, if the bank were a State bank chartered by such State; and
(ii) the conditions established in, or made applicable to this paragraph by, subparagraph (B) are met.
(B)Conditions on establishment and operation of interstate branch.—
(i)Establishment.—An application by an insured State nonmember bank to establish and operate a de novo branch in a host State shall be subject to the same requirements and conditions to which an application for a merger transaction is subject under paragraphs (1), (3), and (4) of section 1831u(b) of this title.
(ii)Operation.—Subsections (c) and (d)(2) of section 1831u of this title shall apply with respect to each branch of an insured State nonmember bank which is established and operated pursuant to an application approved under this paragraph in the same manner and to the same extent such provisions of such section apply to a branch of a State bank which resulted from a merger transaction under such section 1831u of this title.
(C)“De novo branch” defined.—For purposes of this paragraph, the term “de novo branch” means a branch of a State bank which—
(i) is originally established by the State bank as a branch; and
(ii) does not become a branch of such bank as a result of—(I) the acquisition by the bank of an insured depository institution or a branch of an insured depository institution; or(II) the conversion, merger, or consolidation of any such institution or branch.
(D)“Home state” defined.—The term “home State” means the State by which a State bank is chartered.
(E)“Host state” defined.—The term “host State” means, with respect to a bank, a State, other than the home State of the bank, in which the bank maintains, or seeks to establish and maintain, a branch.
(e) Indemnity insurance
(f) Publication of reports
(g) [Repealed]
(h) Penalty for failure to timely pay assessments
(1) In general
(2) Exception in case of disputeParagraph (1) shall not apply if—
(A) the failure to pay an assessment is due to a dispute between the insured depository institution and the Corporation over the amount of such assessment; and
(B) the insured depository institution deposits security satisfactory to the Corporation for payment upon final determination of the issue.
(3) Special rule for small assessment amounts
(4) Authority to modify or remit penalty
(i) Reduction or retirement of capital stock, notes, or debentures; conversion of insured Federal depository institutions to insured State banks or noninsured institutions; consent of banking agencies; applicability
(1) No insured State nonmember bank shall, without the prior consent of the Corporation, reduce the amount or retire any part of its common or preferred capital stock, or retire any part of its capital notes or debentures.
(2) No insured Federal depository institution shall convert into an insured State depository institution if its capital stock or its surplus will be less than the capital stock or surplus, respectively, of the converting bank at the time of the shareholder’s meeting approving such conversion, without the prior written consent of—
(A) the Board of Governors of the Federal Reserve System if the resulting bank is to be a State member bank;
(B) the Corporation if the resulting bank is to be a State nonmember insured bank; and
(C) the Corporation if the resulting institution is to be an insured State savings association.
(3) Without the prior written consent of the Corporation, no insured depository institution shall convert into a noninsured bank or institution.
(4) In granting or withholding consent under this subsection, the responsible agency shall consider—
(A) the financial history and condition of the bank,
(B) the adequacy of its capital structure,
(C) its future earnings prospects,
(D) the general character and fitness of its management,
(E) the convenience and needs of the community to be served, and
(F) whether or not its corporate powers are consistent with the purposes of this chapter.
(j) Restrictions on transactions with affiliates and insiders
(1) Transactions with affiliates
(A) In general
(B) “Affiliate” defined
(2) Extensions of credit to officers, directors, and principal shareholders
(3) Avoiding extraterritorial application to foreign banks
(A) Transactions with affiliates
(B) Extensions of credit to officers, directors, and principal shareholders
(C) “Foreign bank” defined
(k) Authority to regulate or prohibit certain forms of benefits to institution-affiliated parties
(1) Golden parachutes and indemnification payments
(2) Factors to be taken into accountThe Corporation shall prescribe, by regulation, the factors to be considered by the Corporation in taking any action pursuant to paragraph (1) which may include such factors as the following:
(A) Whether there is a reasonable basis to believe that the institution-affiliated party has committed any fraudulent act or omission, breach of trust or fiduciary duty, or insider abuse with regard to the depository institution or covered company that has had a material affect on the financial condition of the institution.
(B) Whether there is a reasonable basis to believe that the institution-affiliated party is substantially responsible for—
(i) the insolvency of the depository institution or covered company;
(ii) the appointment of a conservator or receiver for the depository institution; or
(iii) the troubled condition of the depository institution (as defined in the regulations prescribed pursuant to section 1831i(f) of this title).
(C) Whether there is a reasonable basis to believe that the institution-affiliated party has materially violated any applicable Federal or State banking law or regulation that has had a material affect on the financial condition of the institution.
(D) Whether there is a reasonable basis to believe that the institution-affiliated party has violated or conspired to violate—
(i) section 215, 656, 657, 1005, 1006, 1007, 1014, 1032, or 1344 of title 18; or
(ii) section 1341 or 1343 of such title affecting a federally insured financial institution.
(E) Whether the institution-affiliated party was in a position of managerial or fiduciary responsibility.
(F) The length of time the party was affiliated with the insured depository institution or covered company, and the degree to which—
(i) the payment reasonably reflects compensation earned over the period of employment; and
(ii) the compensation involved represents a reasonable payment for services rendered.
(3) Certain payments prohibitedNo insured depository institution or covered company may prepay the salary or any liability or legal expense of any institution-affiliated party if such payment is made—
(A) in contemplation of the insolvency of such institution or covered company or after the commission of an act of insolvency; and
(B) with a view to, or has the result of—
(i) preventing the proper application of the assets of the institution to creditors; or
(ii) preferring one creditor over another.
(4) “Golden parachute payment” definedFor purposes of this subsection—
(A) In generalThe term “golden parachute payment” means any payment (or any agreement to make any payment) in the nature of compensation by any insured depository institution or covered company for the benefit of any institution-affiliated party pursuant to an obligation of such institution or covered company that—
(i) is contingent on the termination of such party’s affiliation with the institution or covered company; and
(ii) is received on or after the date on which—(I) the insured depository institution or covered company, or any insured depository institution subsidiary of such covered company, is insolvent;(II) any conservator or receiver is appointed for such institution;(III) the institution’s appropriate Federal banking agency determines that the insured depository institution is in a troubled condition (as defined in the regulations prescribed pursuant to section 1831i(f) of this title);(IV) the insured depository institution has been assigned a composite rating by the appropriate Federal banking agency or the Corporation of 4 or 5 under the Uniform Financial Institutions Rating System; or(V) the insured depository institution is subject to a proceeding initiated by the Corporation to terminate or suspend deposit insurance for such institution.
(B) Certain payments in contemplation of an event
(C) Certain payments not includedThe term “golden parachute payment” shall not include—
(i) any payment made pursuant to a retirement plan which is qualified (or is intended to be qualified) under section 401 of title 26 or other nondiscriminatory benefit plan;
(ii) any payment made pursuant to a bona fide deferred compensation plan or arrangement which the Board determines, by regulation or order, to be permissible; or
(iii) any payment made by reason of the death or disability of an institution-affiliated party.
(5) Other definitionsFor purposes of this subsection—
(A) Indemnification paymentSubject to paragraph (6), the term “indemnification payment” means any payment (or any agreement to make any payment) by any insured depository institution or covered company for the benefit of any person who is or was an institution-affiliated party, to pay or reimburse such person for any liability or legal expense with regard to any administrative proceeding or civil action instituted by the appropriate Federal banking agency which results in a final order under which such person—
(i) is assessed a civil money penalty;
(ii) is removed or prohibited from participating in conduct of the affairs of the insured depository institution; or
(iii) is required to take any affirmative action described in section 1818(b)(6) of this title with respect to such institution.
(B) Liability or legal expenseThe term “liability or legal expense” means—
(i) any legal or other professional expense incurred in connection with any claim, proceeding, or action;
(ii) the amount of, and any cost incurred in connection with, any settlement of any claim, proceeding, or action; and
(iii) the amount of, and any cost incurred in connection with, any judgment or penalty imposed with respect to any claim, proceeding, or action.
(C) PaymentThe term “payment” includes—
(i) any direct or indirect transfer of any funds or any asset; and
(ii) any segregation of any funds or assets for the purpose of making, or pursuant to an agreement to make, any payment after the date on which such funds or assets are segregated, without regard to whether the obligation to make such payment is contingent on—(I) the determination, after such date, of the liability for the payment of such amount; or(II) the liquidation, after such date, of the amount of such payment.
(D) Covered company
(6) Certain commercial insurance coverage not treated as covered benefit payment
(l) Acquisition of foreign banks or entities
(m) Activities of savings associations and their subsidiaries
(1) ProceduresWhen 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 or the Comptroller of the Currency, as appropriate, 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 of the Comptroller of the Currency and orders of the Corporation and the Comptroller of the Currency.
(2) Enforcement powersWith respect to any subsidiary of an insured savings association:
(A) the Corporation and the Comptroller of the Currency, as appropriate, 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 1818 of this title; and
(B) the Corporation or the Comptroller of the Currency, as appropriate, 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 chapter.
Upon making any such determination, the Corporation or the Office of the Comptroller of the Currency, as appropriate, shall have authority to order the insured savings association to divest itself of control of the subsidiary. The Corporation or the Comptroller of the Currency, as appropriate, 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 Corporation or the Comptroller of the Currency, respectively, may deem appropriate.
(3) Activities incompatible with deposit insurance
(A) In general
(B) Authority of Comptroller of the Currency
(C) Additional authority of FDIC to prevent serious risks to insurance fund
(4) “Subsidiary” defined
(5) Applicability to certain savings banksSubparagraphs (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
(o) Real estate lending
(1) Uniform regulationsNot more than 9 months after December 19, 1991, each appropriate Federal banking agency shall adopt uniform regulations prescribing standards for extensions of credit that are—
(A) secured by liens on interests in real estate; or
(B) made for the purpose of financing the construction of a building or other improvements to real estate.
(2) Standards
(A) CriteriaIn prescribing standards under paragraph (1), the agencies shall consider—
(i) the risk posed to the Deposit Insurance Fund by such extensions of credit;
(ii) the need for safe and sound operation of insured depository institutions; and
(iii) the availability of credit.
(B) Variations permittedIn prescribing standards under paragraph (1), the appropriate Federal banking agencies may differentiate among types of loans—
(i) as may be required by Federal statute;
(ii) as may be warranted, based on the risk to the Deposit Insurance Fund; or
(iii) as may be warranted, based on the safety and soundness of the institutions.
(3) Loan evaluation standard
(4) Effective date
(p) Periodic review of capital standards
(q) Sovereign risk
(r) Subsidiary depository institutions as agents for certain affiliates
(1) In general
(2) Bank acting as agent is not a branch
(3) Prohibitions on activitiesA depository institution may not—
(A) conduct any activity as an agent under paragraph (1) or (6) which such institution is prohibited from conducting as a principal under any applicable Federal or State law; or
(B) as a principal, have an agent conduct any activity under paragraph (1) or (6) which the institution is prohibited from conducting under any applicable Federal or State law.
(4) Existing authority not affectedNo provision of this subsection shall be construed as affecting—
(A) the authority of any depository institution to act as an agent on behalf of any other depository institution under any other provision of law; or
(B) whether a depository institution which conducts any activity as an agent on behalf of any other depository institution under any other provision of law shall be considered to be a branch of such other institution.
(5) Agency relationship required to be consistent with safe and sound banking practices
(6) Affiliated insured savings associationsAn insured savings association which was an affiliate of a bank on July 1, 1994, may conduct activities as an agent on behalf of such bank in the same manner as an insured bank affiliate of such bank may act as agent for such bank under this subsection to the extent such activities are conducted only in—
(A) any State in which—
(i) the bank is not prohibited from operating a branch under any provision of Federal or State law; and
(ii) the savings association maintained an office or branch and conducted business as of July 1, 1994; or
(B) any State in which—
(i) the bank is not expressly prohibited from operating a branch under a State law described in section 1831u(a)(2) of this title; and
(ii) the savings association maintained a main office and conducted business as of July 1, 1994.
(s) Prohibition on certain affiliations
(1) In general
(2) Exception for members of a Federal home loan bank
(3) Routine business financing
(4) Student loans
(A) In generalThis subsection shall not apply to any arrangement between the Holding Company (or any subsidiary of the Holding Company other than the Student Loan Marketing Association) and a depository institution, if the Secretary approves the affiliation and determines that—
(i) the reorganization of such Association in accordance with section 1087–3 of title 20 will not be adversely affected by the arrangement;
(ii) the dissolution of the Association pursuant to such reorganization will occur before the end of the 2-year period beginning on the date on which such arrangement is consummated or on such earlier date as the Secretary deems appropriate: Provided, That the Secretary may extend this period for not more than 1 year at a time if the Secretary determines that such extension is in the public interest and is appropriate to achieve an orderly reorganization of the Association or to prevent market disruptions in connection with such reorganization, but no such extensions shall in the aggregate exceed 2 years;
(iii) the Association will not purchase or extend credit to, or guarantee or provide credit enhancement to, any obligation of the depository institution;
(iv) the operations of the Association will be separate from the operations of the depository institution; and
(v) until the “dissolution date” (as that term is defined in section 1087–3 of title 20) has occurred, such depository institution will not use the trade name or service mark “Sallie Mae” in connection with any product or service it offers if the appropriate Federal banking agency for such depository institution determines that—(I) the depository institution is the only institution offering such product or service using the “Sallie Mae” name; and(II) such use would result in the depository institution having an unfair competitive advantage over other depository institutions.
(B) Terms and conditionsIn approving any arrangement referred to in subparagraph (A) the Secretary may impose any terms and conditions on such an arrangement that the Secretary considers appropriate, including—
(i) imposing additional restrictions on the issuance of debt obligations by the Association; or
(ii) restricting the use of proceeds from the issuance of such debt.
(C) Additional limitationsIn the event that the Holding Company (or any subsidiary of the Holding Company) enters into such an arrangement, the value of the Association’s “investment portfolio” shall not at any time exceed the lesser of—
(i) the value of such portfolio on the date of the enactment of this subsection; or
(ii) the value of such portfolio on the date such an arrangement is consummated. The term “investment portfolio” shall mean all investments shown on the consolidated balance sheet of the Association other than—(I) any instrument or assets described in section 1087–2(d) of title 20, as such section existed on the day before the date of the repeal of such section;(II) any direct noncallable obligations of the United States or any agency thereof for which the full faith and credit of the United States is pledged; or(III) cash or cash equivalents.
(D)
(E) DefinitionsFor purposes of this paragraph, the following definition shall apply—
(i) Association; Holding Company
(ii) Secretary
(5) “Government-sponsored enterprise” defined
(t) Recordkeeping requirements
(1) Requirements
(2) Availability to Commission; confidentiality
(3) Definition
(u) Limitation on claims
(1) In generalNo person may bring a claim against any Federal banking agency (including in its capacity as conservator or receiver) for the return of assets of an affiliate or controlling shareholder of the insured depository institution transferred to, or for the benefit of, an insured depository institution by such affiliate or controlling shareholder of the insured depository institution, or a claim against such Federal banking agency for monetary damages or other legal or equitable relief in connection with such transfer, if at the time of the transfer—
(A) the insured depository institution is subject to any direction issued in writing by a Federal banking agency to increase its capital; and
(B) for that portion of the transfer that is made by an entity covered by section 1844(g) of this title or section 1831v of this title, the Federal banking agency has followed the procedure set forth in such section.
(2) Definition of claimFor purposes of paragraph (1), the term “claim”—
(A) means a cause of action based on Federal or State law that—
(i) provides for the avoidance of preferential or fraudulent transfers or conveyances; or
(ii) provides similar remedies for preferential or fraudulent transfers or conveyances; and
(B) does not include any claim based on actual intent to hinder, delay, or defraud pursuant to such a fraudulent transfer or conveyance law.
(v) Loans by insured institutions on their own stock
(1) General prohibition
(2) Exclusion
(w) Written employment references may contain suspicions of involvement in illegal activity
(1) Authority to disclose information
(2) Information not required
(3) Malicious intent
(4) Definition
(x) Privileges not affected by disclosure to banking agency or supervisor
(1) In general
(2) Rule of constructionNo provision of paragraph (1) may be construed as implying or establishing that—
(A) any person waives any privilege applicable to information that is submitted or transferred under any circumstance to which paragraph (1) does not apply; or
(B) any person would waive any privilege applicable to any information by submitting the information to the Bureau of Consumer Financial Protection, any Federal banking agency, State bank supervisor, or foreign banking authority, but for this subsection.
(y) State lending limit treatment of derivatives transactions
(z) General prohibition on sale of assets
(1) In generalAn insured depository institution may not purchase an asset from, or sell an asset to, an executive officer, director, or principal shareholder of the insured depository institution, or any related interest of such person (as such terms are defined in section 375b of this title), unless—
(A) the transaction is on market terms; and
(B) if the transaction represents more than 10 percent of the capital stock and surplus of the insured depository institution, the transaction has been approved in advance by a majority of the members of the board of directors of the insured depository institution who do not have an interest in the transaction.
(2) Rulemaking
(aa) Treatment of certain municipal obligations
(1) DefinitionsIn this subsection—
(A) the term “investment grade”, with respect to an obligation, has the meaning given the term in section 1.2 of title 12, Code of Federal Regulations, or any successor thereto;
(B) the term “liquid and readily-marketable” has the meaning given the term in section 249.3 of title 12, Code of Federal Regulations, or any successor thereto; and
(C) the term “municipal obligation” means an obligation of—
(i) a State or any political subdivision thereof; or
(ii) any agency or instrumentality of a State or any political subdivision thereof.
(2) Municipal obligationsFor purposes of the final rule entitled “Liquidity Coverage Ratio: Liquidity Risk Measurement Standards” (79 Fed. Reg. 61439 (October 10, 2014)), the final rule entitled “Liquidity Coverage Ratio: Treatment of U.S. Municipal Securities as High-Quality Liquid Assets” (81 Fed. Reg. 21223 (April 11, 2016)), and any other regulation that incorporates a definition of the term “high-quality liquid asset” or another substantially similar term, the appropriate Federal banking agencies shall treat a municipal obligation as a high-quality liquid asset that is a level 2B liquid asset if that obligation is, as of the date of calculation—
(A) liquid and readily-marketable; and
(B) investment grade.
(Sept. 21, 1950, ch. 967, § 2[18], 64 Stat. 891; Pub. L. 86–463, May 13, 1960, 74 Stat. 129; Pub. L. 87–827, § 2, Oct. 15, 1962, 76 Stat. 953; Pub. L. 89–79, § 2, July 21, 1965, 79 Stat. 244; Pub. L. 89–356, § 1, Feb. 21, 1966, 80 Stat. 7; Pub. L. 89–485, § 12(c), July 1, 1966, 80 Stat. 242; Pub. L. 89–597, § 3, Sept. 21, 1966, 80 Stat. 824; Pub. L. 90–505, § 2(b), Sept. 21, 1968, 82 Stat. 856; Pub. L. 91–151, title I, §§ 2(a), 4(b), (c), Dec. 23, 1969, 83 Stat. 372, 374, 375; Pub. L. 93–100, § 3, Aug. 16, 1973, 87 Stat. 342; Pub. L. 93–495, title I, § 106, Oct. 28, 1974, 88 Stat. 1505; Pub. L. 93–501, title I, § 102(a), title III, § 302, Oct. 29, 1974, 88 Stat. 1558, 1560; Pub. L. 95–369, § 6(c)(25)–(28), Sept. 17, 1978, 92 Stat. 620; Pub. L. 95–630, title I, § 108, title III, §§ 301(b), (c), 306, Nov. 10, 1978, 92 Stat. 3664, 3675, 3677; Pub. L. 96–104, title II, § 202, Nov. 5, 1979, 93 Stat. 792; Pub. L. 96–161, title I, § 101(b), title II, § 209, Dec. 28, 1979, 93 Stat. 1233, 1239; Pub. L. 96–221, title II, § 207(b)(2), (3), title III, §§ 302(b), 307, title V, § 529, Mar. 31, 1980, 94 Stat. 144, 146, 147, 168; Pub. L. 97–320, title I, § 113(n), (o), title IV, §§ 410(d), 423, 424(b), (d)(10), (e), Oct. 15, 1982, 96 Stat. 1474, 1520, 1522, 1523; Pub. L. 100–86, title I, §§ 102(b), 103, title V, § 504(b), Aug. 10, 1987, 101 Stat. 566, 632; Pub. L. 101–73, title II, §§ 201, 221, title IX, §§ 905(d), 907(c), Aug. 9, 1989, 103 Stat. 187, 266, 460, 466; Pub. L. 101–647, title XXV, § 2523(a), Nov. 29, 1990, 104 Stat. 4868; Pub. L. 102–242, title III, §§ 304(a), 305(a), 306(k), Dec. 19, 1991, 105 Stat. 2354, 2359; Pub. L. 102–550, title XVI, § 1605(a)(9), Oct. 28, 1992, 106 Stat. 4086; Pub. L. 103–325, title III, §§ 321(b), 324, 326(b)(1), title VI, § 602(a)(44)–(50), Sept. 23, 1994, 108 Stat. 2226, 2227, 2229, 2290; Pub. L. 103–328, title I, §§ 101(d), 102(b)(3)(A), 103(b), Sept. 29, 1994, 108 Stat. 2342, 2350, 2353; Pub. L. 104–208, div. A, title II, §§ 2615(b), 2704(d)(14)(U), (V), Sept. 30, 1996, 110 Stat. 3009–479, 3009–494; Pub. L. 105–277, div. H, § 2, Oct. 21, 1998, 112 Stat. 2681–854; Pub. L. 106–102, title II, § 204, title VII, § 730, Nov. 12, 1999, 113 Stat. 1391, 1476; Pub. L. 106–569, title XII, § 1207(b), Dec. 27, 2000, 114 Stat. 3034; Pub. L. 107–56, title III, §§ 327(b)(1), 355, Oct. 26, 2001, 115 Stat. 319, 324; Pub. L. 108–386, § 8(a)(5), Oct. 30, 2004, 118 Stat. 2231; Pub. L. 108–458, title VI, § 6203(j), Dec. 17, 2004, 118 Stat. 3747; Pub. L. 109–171, title II, §§ 2102(b), 2104(c), Feb. 8, 2006, 120 Stat. 9, 13; Pub. L. 109–173, §§ 2(c)(2), 8(a)(28)–(30), Feb. 15, 2006, 119 Stat. 3602, 3615; Pub. L. 109–351, title VI, §§ 606, 607(a), title VII, §§ 702(b), 704, Oct. 13, 2006, 120 Stat. 1981, 1982, 1985, 1986; Pub. L. 110–315, title IV, § 438(b), Aug. 14, 2008, 122 Stat. 3258; Pub. L. 110–343, div. A, title I, § 126(a), (d), Oct. 3, 2008, 122 Stat. 3793, 3796; Pub. L. 111–203, title III, § 363(7), title VI, §§ 604(f), 611(a), 613(b), 615(a), 623(a), 627(a)(3), July 21, 2010, 124 Stat. 1553, 1602, 1612, 1614, 1634, 1640; Pub. L. 112–215, § 1(2), Dec. 20, 2012, 126 Stat. 1589; Pub. L. 115–174, title IV, § 403(a), May 24, 2018, 132 Stat. 1360.)

CITE AS: 12 USC 1828

§ 1828a. Prudential safeguards
(a) Comptroller of the Currency
(1) In general
The Comptroller of the Currency may, by regulation or order, impose restrictions or requirements on relationships or transactions between a national bank and a subsidiary of the national bank that the Comptroller finds are—
(A) consistent with the purposes of this Act, title LXII of the Revised Statutes of the United States, and other Federal law applicable to national banks; and
(B) appropriate to avoid any significant risk to the safety and soundness of insured depository institutions or the Deposit Insurance Fund or other adverse effects, such as undue concentration of resources, decreased or unfair competition, conflicts of interests, or unsound banking practices.
(2) Review
The Comptroller of the Currency shall regularly—
(A) review all restrictions or requirements established pursuant to paragraph (1) to determine whether there is a continuing need for any such restriction or requirement to carry out the purposes of the Act, including the avoidance of any adverse effect referred to in paragraph (1)(B); and
(B) modify or eliminate any such restriction or requirement the Comptroller finds is no longer required for such purposes.
(b) Board of Governors of the Federal Reserve System
(1) In general
The Board of Governors of the Federal Reserve System may, by regulation or order, impose restrictions or requirements on relationships or transactions—
(A) between a depository institution subsidiary of a bank holding company and any affiliate of such depository institution (other than a subsidiary of such institution); or
(B) between a State member bank and a subsidiary of such bank;
if the Board makes a finding described in paragraph (2) with respect to such restriction or requirement.
(2) Finding
The Board of Governors of the Federal Reserve System may exercise authority under paragraph (1) if the Board finds that the exercise of such authority is—
(A) consistent with the purposes of this Act, the Bank Holding Company Act of 1956 [12 U.S.C. 1841 et seq.], the Federal Reserve Act [12 U.S.C. 221 et seq.], and other Federal law applicable to depository institution subsidiaries of bank holding companies or State member banks, as the case may be; and
(B) appropriate to prevent an evasion of any provision of law referred to in subparagraph (A) or to avoid any significant risk to the safety and soundness of depository institutions or the Deposit Insurance Fund or other adverse effects, such as undue concentration of resources, decreased or unfair competition, conflicts of interests, or unsound banking practices.
(3) Review
The Board of Governors of the Federal Reserve System shall regularly—
(A) review all restrictions or requirements established pursuant to paragraph (1) or (4) to determine whether there is a continuing need for any such restriction or requirement to carry out the purposes of the Act, including the avoidance of any adverse effect referred to in paragraph (2)(B) or (4)(B); and
(B) modify or eliminate any such restriction or requirement the Board finds is no longer required for such purposes.
(4) Foreign banks
The Board may, by regulation or order, impose restrictions or requirements on relationships or transactions between a branch, agency, or commercial lending company of a foreign bank in the United States and any affiliate in the United States of such foreign bank that the Board finds are—
(A) consistent with the purposes of this Act, the Bank Holding Company Act of 1956, the Federal Reserve Act, and other Federal law applicable to foreign banks and their affiliates in the United States; and
(B) appropriate to prevent an evasion of any provision of law referred to in subparagraph (A) or to avoid any significant risk to the safety and soundness of depository institutions or the Deposit Insurance Fund or other adverse effects, such as undue concentration of resources, decreased or unfair competition, conflicts of interests, or unsound banking practices.
(c) Federal Deposit Insurance Corporation
(1) In general
The Federal Deposit Insurance Corporation may, by regulation or order, impose restrictions or requirements on relationships or transactions between a State nonmember bank (as defined in section 3 of the Federal Deposit Insurance Act [12 U.S.C. 1813]) and a subsidiary of the State nonmember bank that the Corporation finds are—
(A) consistent with the purposes of this Act, the Federal Deposit Insurance Act [12 U.S.C. 1811 et seq.], or other Federal law applicable to State nonmember banks; and
(B) appropriate to avoid any significant risk to the safety and soundness of depository institutions or the Deposit Insurance Fund or other adverse effects, such as undue concentration of resources, decreased or unfair competition, conflicts of interests, or unsound banking practices.
(2) Review
The Federal Deposit Insurance Corporation shall regularly—
(A) review all restrictions or requirements established pursuant to paragraph (1) to determine whether there is a continuing need for any such restriction or requirement to carry out the purposes of the Act, including the avoidance of any adverse effect referred to in paragraph (1)(B); and
(B) modify or eliminate any such restriction or requirement the Corporation finds is no longer required for such purposes.
(Pub. L. 106–102, title I, § 114, Nov. 12, 1999, 113 Stat. 1369; Pub. L. 109–173, § 9(i), Feb. 15, 2006, 119 Stat. 3618.)

CITE AS: 12 USC 1828a

§ 1828b. Interagency data sharing
(a) In general
(b) Confidentiality requirements
(1) In general
(2) Procedures for disclosure
(3) Other privileges not waived by disclosure under this section
(4) Exception
(c) Banking agency information sharing
The provisions of subsection (b) shall apply to—
(1) any information or material obtained by any Federal banking agency (as defined in section 1813(z) of this title) from any other Federal banking agency; and
(2) any report of examination or other confidential supervisory information obtained by any State agency or authority, or any other person, from a Federal banking agency.
(Pub. L. 106–102, title I, § 132, Nov. 12, 1999, 113 Stat. 1382.)

CITE AS: 12 USC 1828b

§ 1829. Penalty for unauthorized participation by convicted individual
(a) Prohibition
(1) In generalExcept with the prior written consent of the Corporation—
(A) any person who has been convicted of any criminal offense involving dishonesty or a breach of trust or money laundering, or has agreed to enter into a pretrial diversion or similar program in connection with a prosecution for such offense, may not—
(i) become, or continue as, an institution-affiliated party with respect to any insured depository institution;
(ii) own or control, directly or indirectly, any insured depository institution; or
(iii) otherwise participate, directly or indirectly, in the conduct of the affairs of any insured depository institution; and
(B) any insured depository institution may not permit any person referred to in subparagraph (A) to engage in any conduct or continue any relationship prohibited under such subparagraph.
(2) Minimum 10-year prohibition period for certain offenses
(A) In generalIf the offense referred to in paragraph (1)(A) in connection with any person referred to in such paragraph is—
(i) an offense under—(I) section 215, 656, 657, 1005, 1006, 1007, 1008,1
1 See References in Text note below.
1014, 1032, 1344, 1517, 1956, or 1957 of title 18; or(II) section 1341 or 1343 of such title which affects any financial institution (as defined in section 20 of such title); or
(ii) the offense of conspiring to commit any such offense,
the Corporation may not consent to any exception to the application of paragraph (1) to such person during the 10-year period beginning on the date the conviction or the agreement of the person becomes final.
(B) Exception by order of sentencing court
(i) In general
(ii) Period for filing
(b) Penalty
(c) Exceptions
(1) Certain older offenses
(A) In generalWith respect to an individual, subsection (a) shall not apply to an offense if—
(i) it has been 7 years or more since the offense occurred; or
(ii) the individual was incarcerated with respect to the offense and it has been 5 years or more since the individual was released from incarceration.
(B) Offenses committed by individuals 21 or younger
(C) Limitation
(2) Expungement and sealingWith respect to an individual, subsection (a) shall not apply to an offense if—
(A) there is an order of expungement, sealing, or dismissal that has been issued in regard to the conviction in connection with such offense; and
(B) it is intended by the language in the order itself, or in the legislative provisions under which the order was issued, that the conviction shall be destroyed or sealed from the individual’s State, Tribal, or Federal record, even if exceptions allow the record to be considered for certain character and fitness evaluation purposes.
(3) De minimis exemption
(A) In general
(B) Confinement criteriaIn issuing rules under subparagraph (A), the Corporation shall include a requirement that the offense was punishable by a term of three years or less confined in a correctional facility, where such confinement—
(i) is calculated based on the time an individual spent incarcerated as a punishment or a sanction, not as pretrial detention; and
(ii) does not include probation or parole where an individual was restricted to a particular jurisdiction or was required to report occasionally to an individual or a specific location.
(C) Bad check criteria
(D) Designated lesser offenses
(d) Bank holding companies
(1) In general
(2) Authority of Board
(e) Savings and loan holding companies
(1) In general
(2) Authority of Director
(f) Consent applications
(1) In general
(2) Sponsored applications filed with regional officesConsent applications filed at a regional office of the Corporation by an insured depository institution or depository institution holding company on behalf of an individual—
(A) shall be reviewed by such office;
(B) may be approved or denied by such office, if such authority has been delegated to such office by the Corporation; and
(C) may only be denied by such office if the general counsel of the Corporation (or a designee) certifies that the denial is consistent with this section.
(3) Individual applications filed with regional officesConsent applications filed at a regional office by an individual—
(A) shall be reviewed by such office; and
(B) may be approved or denied by such office, if such authority has been delegated to such office by the Corporation, except with respect to—
(i) cases involving an offense described under subsection (a)(2); and
(ii) such other high-level security cases as may be designated by the Corporation.
(4) National office reviewThe national office of the Corporation shall—
(A) review any consent application with respect to which a regional office is not authorized to approve or deny the application; and
(B) review any consent application that is denied by a regional office, if the individual requests a review by the national office.
(5) Forms and instructions
(A) Availability
(B) Contents
(6) Consideration of criminal history
(A) Regional office considerationIn reviewing a consent application, a regional office shall—
(i) primarily rely on the criminal history record of the Federal Bureau of Investigation; and
(ii) provide such record to the applicant to review for accuracy.
(B) Certified copies
(7) Consideration of rehabilitationConsistent with title VII of the Civil Rights Act of 1964 (42 U.S.C. 2000e et seq.), the Corporation shall—
(A) conduct an individualized assessment when evaluating consent applications that takes into account evidence of rehabilitation, the applicant’s age at the time of the conviction or program entry, the time that has elapsed since conviction or program entry, and the relationship of individual’s 2
2 So in original. Probably should be preceded by “the”.
offense to the responsibilities of the applicable position;
(B) consider the individual’s employment history, letters of recommendation, certificates documenting participation in substance abuse programs, successful participating in job preparation and educational programs, and other relevant mitigating evidence; and
(C) consider any additional information the Corporation determines necessary for safety and soundness.
(8) Scope of employment
(9) Coordination with the NCUA
(g) DefinitionsIn this section:
(1) Consent application
(2) Criminal offense involving dishonestyThe term “criminal offense involving dishonesty”—
(A) means an offense under which an individual, directly or indirectly—
(i) cheats or defrauds; or
(ii) wrongfully takes property belonging to another in violation of a criminal statute;
(B) includes an offense that Federal, State, or local law defines as dishonest, or for which dishonesty is an element of the offense; and
(C) does not include—
(i) a misdemeanor criminal offense committed more than one year before the date on which an individual files a consent application, excluding any period of incarceration; or
(ii) an offense involving the possession of controlled substances.
(3) Pretrial diversion or similar program
(Sept. 21, 1950, ch. 967, § 2[19], 64 Stat. 893; Pub. L. 101–73, title IX, § 910(a), Aug. 9, 1989, 103 Stat. 477; Pub. L. 101–647, title XXV, § 2502(a), Nov. 29, 1990, 104 Stat. 4860; Pub. L. 102–550, title XV, § 1505, Oct. 28, 1992, 106 Stat. 4055; Pub. L. 103–322, title XXXII, § 320605, Sept. 13, 1994, 108 Stat. 2119; Pub. L. 109–351, title VII, § 710(a), Oct. 13, 2006, 120 Stat. 1990; Pub. L. 111–203, title III, § 363(8), July 21, 2010, 124 Stat. 1554; Pub. L. 117–263, div. E, title LVII, § 5705(a), Dec. 23, 2022, 136 Stat. 3411.)

CITE AS: 12 USC 1829

§ 1829a. Participation by State nonmember insured banks in lotteries and related activities
(a) Prohibited activitiesA State nonmember insured bank may not—
(1) deal in lottery tickets;
(2) deal in bets used as a means or substitute for participation in a lottery;
(3) announce, advertise, or publicize the existence of any lottery; or
(4) announce, advertise, or publicize the existence or identity of any participant or winner, as such, in a lottery.
(b) Use of banking premises prohibited
(1) the use of any part of any of its banking offices by any person for any purpose forbidden to the bank under subsection (a), or
(2) direct access by the public from any of its banking offices to any premises used by any person for any purpose forbidden to the bank under subsection (a).
(c) DefinitionsAs used in this section—
(1) The term “deal in” includes making, taking, buying, selling, redeeming, or collecting.
(2) The term “lottery” includes any arrangement, other than a savings promotion raffle, whereby three or more persons (the “participants”) advance money or credit to another in exchange for the possibility or expectation that one or more but not all of the participants (the “winners”) will receive by reason of their advances more than the amounts they have advanced, the identity of the winners being determined by any means which includes—
(A) a random selection;
(B) a game, race, or contest; or
(C) any record or tabulation of the result of one or more events in which any participant has no interest except for its bearing upon the possibility that he may become a winner.
(3) 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) The term “savings promotion raffle” means a contest in which the sole consideration required for a chance of winning designated prizes is obtained by the deposit of a specified amount of money in a savings account or other savings program, where each ticket or entry has an equal chance of being drawn, such contest being subject to regulations that may from time to time be promulgated by the appropriate prudential regulator (as defined in section 5481 of this title).
(d) Lawful banking services connected with operation of lottery
(e) Regulations; enforcement
(Sept. 21, 1950, ch. 967, § 2[20], as added Pub. L. 90–203, § 3, Dec. 15, 1967, 81 Stat. 610; amended Pub. L. 103–325, title VI, § 602(a)(51), Sept. 23, 1994, 108 Stat. 2290; Pub. L. 113–251, § 3(c), Dec. 18, 2014, 128 Stat. 2889.)

CITE AS: 12 USC 1829a

§ 1829b. Retention of records by insured depository institutions
(a) Congressional findings and declaration of purpose
(1) Findings
Congress finds that—
(A) adequate records maintained by insured depository institutions have a high degree of usefulness in criminal, tax, and regulatory investigations or proceedings, and that, given the threat posed to the security of the Nation on and after the terrorist attacks against the United States on September 11, 2001, such records may also have a high degree of usefulness in the conduct of intelligence or counterintelligence activities, including analysis, to protect against domestic and international terrorism; and
(B) microfilm or other reproductions and other records made by insured depository institutions of checks, as well as records kept by such institutions, of the identity of persons maintaining or authorized to act with respect to accounts therein, have been of particular value in proceedings described in subparagraph (A).
(2) Purpose
(b) Recordkeeping regulations
(1) In general
(2) Domestic funds transfers
(3) International funds transfers
(A) In general
The Secretary and the Board shall jointly prescribe, after consultation with State banking supervisors, final regulations requiring that insured depository institutions, businesses that provide check cashing services, money transmitting businesses, and businesses that issue or redeem money orders, travelers’ checks or other similar instruments maintain such records of payment orders which—
(i) involve international transactions; and
(ii) direct transfers of funds over wholesale funds transfer systems or on the books of any insured depository institution, or on the books of any business that provides check cashing services, any money transmitting business, and any business that issues or redeems money orders, travelers’ checks or similar instruments,
that will have a high degree of usefulness in criminal, tax, or regulatory investigations or proceedings.
(B) Factors for consideration
In prescribing the regulations required under subparagraph (A), the Secretary and the Board shall consider—
(i) the usefulness in criminal, tax, or regulatory investigations or proceedings of any record required to be maintained pursuant to the proposed regulations; and
(ii) the effect the recordkeeping required pursuant to such proposed regulations will have on the cost and efficiency of the payment system.
(C) Availability of records
(c) Identity of persons having accounts and persons authorized to act with respect to such accounts; exemptions
(d) Reproduction of checks, drafts, and other instruments; record of transactions; identity of party
Each insured depository institution shall make, to the extent that the regulations of the Secretary so require—
(1) a microfilm or other reproduction of each check, draft, or similar instrument drawn on it and presented to it for payment; and
(2) a record of each check, draft, or similar instrument received by it for deposit or collection, together with an identification of the party for whose account it is to be deposited or collected, unless the insured depository institution has already made a record of the party’s identity pursuant to subsection (c).
(e) Identity of persons making reportable currency and foreign transactions
(f) Additions to or substitutes for required records
(g) Retention period
(h) Report to Congress by Secretary of the Treasury
(i) Application of provisions to foreign banks
(j) Civil penalties
(1) Penalty imposed
(2) Treatment of continuing violation
(3) Assessment
(Sept. 21, 1950, ch. 967, § 2[21], as added Pub. L. 91–508, title I, § 101, Oct. 26, 1970, 84 Stat. 1114; amended Pub. L. 95–369, § 6(c)(29), Sept. 17, 1978, 92 Stat. 620; Pub. L. 100–690, title VI, § 6185(d)(1), Nov. 18, 1988, 102 Stat. 4356; Pub. L. 101–73, title II, § 201(a), Aug. 9, 1989, 103 Stat. 187; Pub. L. 102–550, title XV, §§ 1515(a), (b), 1535(b), Oct. 28, 1992, 106 Stat. 4058, 4059, 4066; Pub. L. 103–325, title VI, § 602(a)(52)–(54), Sept. 23, 1994, 108 Stat. 2290; Pub. L. 107–56, title III, § 358(d), Oct. 26, 2001, 115 Stat. 326; Pub. L. 108–458, title VI, § 6203(k), Dec. 17, 2004, 118 Stat. 3747.)

CITE AS: 12 USC 1829b

§ 1829c. Making online banking initiation legal and easy
(a) Definitions
In this section:
(1) Affiliate
(2) Driver’s license
(3) Federal bank secrecy laws
The term “Federal bank secrecy laws” means—
(A)section 1829b of this title;
(B)section 1953 of this title; and
(C) subchapter II of chapter 53 of title 31.
(4) Financial institution
The term “financial institution” means—
(A) an insured depository institution;
(B) an insured credit union; or
(C) any affiliate of an insured depository institution or insured credit union.
(5) Financial product or service
(6) Insured credit union
(7) Insured depository institution
(8) Online service
(9) Personal identification card
(10) Personal information
(11) Scan
(12) State
(b) Use of a driver’s license or personal identification card
(1) In general
(2) Uses of information
Except as required to comply with Federal bank secrecy laws, a financial institution may only use the information obtained under paragraph (1)—
(A) to verify the authenticity of the driver’s license or personal identification card;
(B) to verify the identity of the individual; and
(C) to comply with a legal requirement to record, retain, or transmit the personal information in connection with opening an account or obtaining a financial product or service.
(3) Deletion of image
A financial institution that makes a copy or receives an image of a driver’s license or personal identification card of an individual in accordance with paragraphs (1) and (2) shall, after using the image for the purposes described in paragraph (2), permanently delete—
(A) any image of the driver’s license or personal identification card, as applicable; and
(B) any copy of any such image.
(4) Disclosure of personal information
(c) Relation to State law
(Pub. L. 115–174, title II, § 213, May 24, 2018, 132 Stat. 1319.)

CITE AS: 12 USC 1829c

§ 1830. Nondiscrimination

It is not the purpose of this chapter 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 chapter to provide all banks and savings associations with the same opportunity to obtain and enjoy the benefits of this chapter.

(Sept. 21, 1950, ch. 967, § 2[22], formerly § 2[20], 64 Stat. 893; renumbered § 2[21], Pub. L. 90–203, § 3, Dec. 15, 1967, 81 Stat. 610; renumbered § 2[22], Pub. L. 91–508, title I, § 101, Oct. 26, 1970, 84 Stat. 1114; amended Pub. L. 101–73, title II, § 223, Aug. 9, 1989, 103 Stat. 273.)

CITE AS: 12 USC 1830

§ 1831. Separability of certain provisions of this chapter

The provisions of this chapter limiting the insurance of the deposits of any depositor to a maximum less than the full amount shall be independent and separable from each and all of the provisions of this chapter.

(Sept. 21, 1950, ch. 967, § 2[23], formerly § 2[21], 64 Stat. 894; renumbered § 2[22], Pub. L. 90–203, § 3, Dec. 15, 1967, 81 Stat. 610; renumbered § 2[23], Pub. L. 91–508, title I, § 101, Oct. 26, 1970, 84 Stat. 1114.)

CITE AS: 12 USC 1831

§ 1831a. Activities of insured State banks
(a) Permissible activities
(1) In generalAfter the end of the 1-year period beginning on December 19, 1991, an insured State bank may not engage as principal in any type of activity that is not permissible for a national bank unless—
(A) the Corporation has determined that the activity would pose no significant risk to the Deposit Insurance Fund; and
(B) the State bank is, and continues to be, in compliance with applicable capital standards prescribed by the appropriate Federal banking agency.
(2) Processing period
(A) In general
(B) Extension of time period
(b) Insurance underwriting
(1) In general
(2) Exception for certain federally reinsured crop insurance
(c) Equity investments by insured State banks
(1) In general
(2) Exception for certain subsidiaries
(3) Exception for qualified housing projects
(A) Exception
(B) Limitation
(C) Qualified housing project definedAs used in this paragraph—
(i) Qualified housing project
(ii) Lower income
(4) Transition rule
(A) In general
(B) Treatment of noncompliance during divestment
(d) Subsidiaries of insured State banks
(1) In generalAfter the end of the 1-year period beginning on December 19, 1991, a subsidiary of an insured State bank may not engage as principal in any type of activity that is not permissible for a subsidiary of a national bank unless—
(A) the Corporation has determined that the activity poses no significant risk to the Deposit Insurance Fund; and
(B) the bank is, and continues to be, in compliance with applicable capital standards prescribed by the appropriate Federal banking agency.
(2) Insurance underwriting prohibited
(A) Prohibition
(B) Continuation of existing activities
(C) ExceptionSubparagraph (A) does not apply to a subsidiary of an insured State bank if—
(i) the insured State bank was required, before June 1, 1991, to provide title insurance as a condition of the bank’s initial chartering under State law; and
(ii) control of the insured State bank has not changed since that date.
(3) Processing period
(A) In general
(B) Extension of time period
(e) Savings bank life insurance
(1) In generalNo provision of this chapter shall be construed as prohibiting or impairing the sale or underwriting of savings bank life insurance, or the ownership of stock in a savings bank life insurance company, by any insured bank which—
(A) is located in the Commonwealth of Massachusetts or the State of New York or Connecticut; and
(B) meets applicable consumer disclosure requirements with respect to such insurance.
(2) FDIC finding and action regarding risk
(A) Finding
(B) Actions
(i) In general
(ii) Authorized actions
(f) Common and preferred stock investment
(1) In general
(2) Exception for banks in certain StatesNotwithstanding paragraph (1), an insured State bank may, to the extent permitted by the Corporation, acquire and retain ownership of securities described in paragraph (1) to the extent the aggregate amount of such investment does not exceed an amount equal to 100 percent of the bank’s capital if such bank—
(A) is located in a State that permitted, as of September 30, 1991, investment in common or preferred stock listed on a national securities exchange or shares of an investment company registered under the Investment Company Act of 1940 [15 U.S.C. 80a–1 et seq.]; and
(B) made or maintained an investment in such securities during the period beginning on September 30, 1990, and ending on November 26, 1991.
(3) Exception for certain types of institutionsNotwithstanding paragraph (1), an insured State bank may—
(A) acquire not more than 10 percent of a corporation that only—
(i) provides directors’, trustees’, and officers’ liability insurance coverage or bankers’ blanket bond group insurance coverage for insured depository institutions; or
(ii) reinsures such policies; and
(B) acquire or retain shares of a depository institution if—
(i) the institution engages only in activities permissible for national banks;
(ii) the institution is subject to examination and regulation by a State bank supervisor;
(iii) 20 or more depository institutions own shares of the institution and none of those institutions owns more than 15 percent of the institution’s shares; and
(iv) the institution’s shares (other than directors’ qualifying shares or shares held under or initially acquired through a plan established for the benefit of the institution’s officers and employees) are owned only by the institution.
(4) Transition period for common and preferred stock investments
(A) In general
(B) Compliance at end of period
(5) Loss of exception upon acquisition
(6) Notice and approvalAn insured State bank may only engage in any investment pursuant to paragraph (2) if—
(A) the bank has filed a 1-time notice of the bank’s intention to acquire and retain investments described in paragraph (1); and
(B) the Corporation has determined, within 60 days of receiving such notice, that acquiring or retaining such investments does not pose a significant risk to the Deposit Insurance Fund.
(7) Divestiture
(A) In general
(B) Reasonable standard
(g) Determinations
(h) “Activity” defined
(i) Other authority not affected
(j) Activities of branches of out-of-State banks
(1) Application of host State law
(2) Activities of branches
(3) Savings provisionNo provision of this subsection shall be construed as affecting the applicability of—
(A) any State law of any home State under subsection (b), (c), or (d) of section 1831u of this title; or
(B) Federal law to State banks and State bank branches in the home State or the host State.
(4) Definitions
(Sept. 21, 1950, ch. 967, § 2[24], as added Pub. L. 102–242, title III, § 303(a), Dec. 19, 1991, 105 Stat. 2349; amended Pub. L. 102–550, title XVI, § 1605(a)(8), Oct. 28, 1992, 106 Stat. 4086; Pub. L. 103–328, title I, § 102(b)(3)(B), Sept. 29, 1994, 108 Stat. 2351; Pub. L. 104–208, div. A, title II, §§ 2217, 2704(d)(14)(W), Sept. 30, 1996, 110 Stat. 3009–414, 3009–494; Pub. L. 105–24, § 2(a), July 3, 1997, 111 Stat. 238; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 8(a)(31), Feb. 15, 2006, 119 Stat. 3615.)

CITE AS: 12 USC 1831a

§ 1831b. Disclosures with respect to certain federally related mortgage loans
(a) Identity of beneficiary interest as condition for a loan; report to Corporation
(b) Enforcement; bank status
(Sept. 21, 1950, ch. 967, § 2[25], as added Pub. L. 93–533, § 11(a), Dec. 22, 1974, 88 Stat. 1729; amended Pub. L. 95–369, § 6(c)(30), Sept. 17, 1978, 92 Stat. 620; Pub. L. 101–73, title II, § 201(a), Aug. 9, 1989, 103 Stat. 187; Pub. L. 103–325, title VI, § 602(a)(55), Sept. 23, 1994, 108 Stat. 2290.)

CITE AS: 12 USC 1831b

§ 1831c. Assuring consistent oversight of subsidiaries of holding companies
(a) DefinitionsFor purposes of this section:
(1) Board
(2) Functionally regulated subsidiary
(3) Lead insured depository institution
(b) Examination requirements
(c) State coordination
(1) Consultation and coordination
(2) Alternating examinations permitted
(d) Appropriate Federal banking agency backup examination authority
(1) In general
(2) Examination by an appropriate Federal banking agencyIf the Board does not, before the end of the 60-day period beginning on the date on which the Board receives a recommendation under paragraph (1), begin an examination as required under subsection (b) or provide a written explanation or plan to the appropriate Federal banking agency making such recommendation responding to the concerns raised by the appropriate Federal banking agency for the lead insured depository institution, the appropriate Federal banking agency for the lead insured depository institution may, subject to the Consumer Financial Protection Act of 2010, examine the activities that are permissible for a depository institution subsidiary conducted by such nondepository institution subsidiary (other than a functionally regulated subsidiary or a subsidiary of a depository institution) of the depository institution holding company as if the nondepository institution subsidiary were an insured depository institution for which the appropriate Federal banking agency of the lead insured depository institution was the appropriate Federal banking agency, to determine whether the activities—
(A) pose a material threat to the safety and soundness of any insured depository institution subsidiary of the depository institution holding company;
(B) are conducted in accordance with applicable Federal law; and
(C) are subject to appropriate systems for monitoring and controlling the financial, operating, and other material risks of the activities that may pose a material threat to the safety and soundness of the insured depository institution subsidiaries of the holding company.
(3) Agency coordination with the BoardAn appropriate Federal banking agency that conducts an examination pursuant to paragraph (2) shall coordinate examination of the activities of nondepository institution subsidiaries described in subsection (b) with the Board in a manner that—
(A) avoids duplication;
(B) shares information relevant to the supervision of the depository institution holding company;
(C) achieves the objectives of subsection (b); and
(D) ensures that the depository institution holding company and the subsidiaries of the depository institution holding company are not subject to conflicting supervisory demands by such agency and the Board.
(4) Fee permitted for examination costs
(e) Referrals for enforcement by appropriate Federal banking agency
(1) Recommendation of enforcement action
(2) Back-up authority of the appropriate Federal banking agency
(f) Coordination among appropriate Federal banking agenciesEach Federal banking agency, prior to or when exercising authority under subsection (d) or (e) shall—
(1) provide reasonable notice to, and consult with, the appropriate Federal banking agency or State bank supervisor (or other State regulatory agency) of the nondepository institution subsidiary of a depository institution holding company that is described in subsection (d) before commencing any examination of the subsidiary;
(2) to the fullest extent possible—
(A) rely on the examinations, inspections, and reports of the appropriate Federal banking agency or the State bank supervisor (or other State regulatory agency) of the subsidiary;
(B) avoid duplication of examination activities, reporting requirements, and requests for information; and
(C) ensure that the depository institution holding company and the subsidiaries of the depository institution holding company are not subject to conflicting supervisory demands by the appropriate Federal banking agencies.
(g) Rule of construction
(Sept. 21, 1950, ch. 967, § 2[26], as added Pub. L. 111–203, title VI, § 605(a), July 21, 2010, 124 Stat. 1604.)

CITE AS: 12 USC 1831c

§ 1831d. State-chartered insured depository institutions and insured branches of foreign banks
(a) Interest rates
(b) Interest overcharge; forfeiture; interest payment recovery
(Sept. 21, 1950, ch. 967, § 2[27], as added Pub. L. 96–221, title V, § 521, Mar. 31, 1980, 94 Stat. 164; amended Pub. L. 100–86, title I, § 101(g)(2), Aug. 10, 1987, 101 Stat. 563; Pub. L. 101–73, title II, § 201(a), Aug. 9, 1989, 103 Stat. 187.)

CITE AS: 12 USC 1831d

§ 1831e. Activities of savings associations
(a) In generalOn 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 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 1464(t) of this title.
(b) Differences of magnitude between State and Federal powersNotwithstanding subsection (a)(1), if an activity (other than an activity described in section 1464(c)(2)(B) of this title) 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 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 1464(t) of this title.
(c) Equity investments by State savings associations
(1) In general
(2) Exception for service corporationsParagraph (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 Deposit Insurance Fund is posed by—
(i) the amount that the association proposes to acquire or retain; 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 1464(t) of this title.
(3) Transition rule
(A) In general
(B) Treatment of noncompliance during divestment
(d) Corporate debt securities
(1) In general
(2) Exception for securities held by qualified affiliate
(3) DefinitionsFor purposes of this section—
(A) Qualified affiliateThe 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.
(B) Certain securities not included
(e) Transfer of corporate debt security in exchange for a qualified note
(1) Acquisition of noteNotwithstanding subsections (a), (b), and (c) of section 1464 1
1 So in original. Probably should be section “1468”.
of this title 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 August 9, 1989, holds any corporate debt security that does not meet standards of credit-worthiness as established by the Corporation 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 noteThe 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 Comptroller of the Currency or the Corporation, as appropriate;
(B) the company to which the corporate debt security that does not meet standards of credit-worthiness established by the Corporation 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 August 9, 1989, the insured savings association notifies the Comptroller of the Currency or the Corporation, as appropriate, of such association’s intention to transfer the corporate debt security that does not meet standards of credit-worthiness established by the Corporation to the savings and loan holding company or the subsidiary of such holding company;
(D) the transfer of the corporate debt security that does not meet standards of credit-worthiness established by the Corporation is completed—
(i) before the end of the 1-year period beginning on August 9, 1989, in the case of an insured savings association that, as of August 9, 1989, is controlled by a savings and loan holding company; or
(ii) before the end of the 2-year period beginning on August 9, 1989, in the case of a savings association that is not, as of August 9, 1989, a subsidiary of a savings and loan holding company;
(E) the insured savings association receives in exchange for the corporate debt security that does not meet standards of credit-worthiness established by the Corporation the fair market value of such security;
(F) the Comptroller of the Currency or the Corporation, as appropriate has—
(i) approved the transaction; and
(ii) determined that the transfer represents a complete and effective divestiture of the corporate debt security that does not meet standards of credit-worthiness established by the Corporation and is in compliance with the provisions of this subsection; and
(G) any gain on the sale of the corporate debt security that does not meet standards of credit-worthiness established by the Corporation 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 that does not meet standards of credit-worthiness established by the Corporation as carried on the accounts of the insured savings association immediately prior to the transfer.
(3) “Qualified note” definedThe term “qualified note” means any note that—
(A) is at all times fully secured by the corporate debt security that does not meet standards of credit-worthiness established by the Corporation transferred in exchange for the note, or by other collateral of at least equivalent value that is acceptable to the Comptroller of the Currency or the Corporation, as appropriate;
(B) contains provisions acceptable to the Comptroller of the Currency or the Corporation, as appropriate, 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 that does not meet standards of credit-worthiness established by the Corporation 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
(f) Determinations
(g) “Activity” definedFor purposes of subsections (a) and (b)—
(1) In general
(2) Divestiture of certain assets
(h) Other authority not affectedThis section may not be construed as limiting—
(1) any other authority of the Corporation; or
(2) any authority of the Comptroller of the Currency, of the Corporation, or of a State to impose more stringent restrictions.
(Sept. 21, 1950, ch. 967, § 2[28], as added Pub. L. 101–73, title II, § 222, Aug. 9, 1989, 103 Stat. 269; amended Pub. L. 102–242, title I, § 151(a)(3), Dec. 19, 1991, 105 Stat. 2284; Pub. L. 103–325, title VI, § 602(a)(56)–(58), Sept. 23, 1994, 108 Stat. 2290, 2291; Pub. L. 104–208, div. A, title II, § 2704(d)(14)(X), Sept. 30, 1996, 110 Stat. 3009–494; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 8(a)(32), Feb. 15, 2006, 119 Stat. 3615; Pub. L. 111–203, title III, § 363(9), title IX, § 939(a)(2), (3), July 21, 2010, 124 Stat. 1555, 1885.)

CITE AS: 12 USC 1831e

§ 1831f. Brokered deposits
(a) In general
(b) Renewals and rollovers treated as acceptance of funds
(c) Waiver authority
(d) Limited exception for certain conservatorshipsIn 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;
(2) is necessary to enable the institution to meet the demands of its depositors or pay its obligations in the ordinary course of business; and
(3) is consistent with the conservator’s fiduciary duty to minimize the institution’s losses.
Effective 90 days after the date on which the institution was placed in conservatorship, the institution may not accept such deposits.
(e) Restriction on interest rate paid
(1) DefinitionsIn this subsection—
(A) the terms “agent institution”, “reciprocal deposits”, and “well capitalized” have the meanings given those terms in subsection (i); and
(B) the term “covered insured depository institution” means an insured depository institution that—
(i) under subsection (c) or (d), accepts funds obtained, directly or indirectly, by or through a deposit broker; or
(ii) while acting as an agent institution under subsection (i), accepts reciprocal deposits while not well capitalized.
(2) Prohibition
(3) Limit on interest ratesThe limit on the rate of interest referred to in paragraph (2) shall be—
(A) the rate paid on deposits of similar maturity in the normal market area of the covered insured depository institution for deposits accepted in the normal market area of the covered insured depository institution; or
(B) the national rate paid on deposits of comparable maturity, as established by the Corporation, for deposits accepted outside the normal market area of the covered insured depository institution.
(f) Additional restrictions
(g) Definitions relating to deposit broker
(1) Deposit brokerThe 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) ExclusionsThe 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 title 26; 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
(4) EmployeeFor 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.
(h) Deposit solicitation restrictedAn insured depository institution that is undercapitalized, as defined in section 1831o of this title, shall not solicit deposits by offering rates of interest that are significantly higher than the prevailing rates of interest on insured deposits—
(1) in such institution’s normal market areas; or
(2) in the market area in which such deposits would otherwise be accepted.
(i) Limited exception for reciprocal deposits
(1) In generalReciprocal deposits of an agent institution shall not be considered to be funds obtained, directly or indirectly, by or through a deposit broker to the extent that the total amount of such reciprocal deposits does not exceed the lesser of—
(A) $5,000,000,000; or
(B) an amount equal to 20 percent of the total liabilities of the agent institution.
(2) DefinitionsIn this subsection:
(A) Agent institutionThe term “agent institution” means an insured depository institution that places a covered deposit through a deposit placement network at other insured depository institutions in amounts that are less than or equal to the standard maximum deposit insurance amount, specifying the interest rate to be paid for such amounts, if the insured depository institution—
(i)(I) when most recently examined under section 1820(d) of this title was found to have a composite condition of outstanding or good; and(II) is well capitalized;
(ii) has obtained a waiver pursuant to subsection (c); or
(iii) does not receive an amount of reciprocal deposits that causes the total amount of reciprocal deposits held by the agent institution to be greater than the average of the total amount of reciprocal deposits held by the agent institution on the last day of each of the 4 calendar quarters preceding the calendar quarter in which the agent institution was found not to have a composite condition of outstanding or good or was determined to be not well capitalized.
(B) Covered depositThe term “covered deposit” means a deposit that—
(i) is submitted for placement through a deposit placement network by an agent institution; and
(ii) does not consist of funds that were obtained for the agent institution, directly or indirectly, by or through a deposit broker before submission for placement through a deposit placement network.
(C) Deposit placement network
(D) Network member bank
(E) Reciprocal deposits
(F) Well capitalized
(Sept. 21, 1950, ch. 967, § 2[29], as added Pub. L. 101–73, title II, § 224(a), Aug. 9, 1989, 103 Stat. 273; amended Pub. L. 102–242, title III, § 301(a), (c), Dec. 19, 1991, 105 Stat. 2343, 2345; Pub. L. 102–550, title XVI, § 1605(a)(1), Oct. 28, 1992, 106 Stat. 4084; Pub. L. 103–325, title III, § 337, Sept. 23, 1994, 108 Stat. 2235; Pub. L. 115–174, title II, § 202, May 24, 2018, 132 Stat. 1307.)

CITE AS: 12 USC 1831f

§ 1831f–1. Repealed. Pub. L. 106–569, title XII, § 1203, Dec. 27, 2000, 114 Stat. 3032

CITE AS: 12 USC 1831f-1

§ 1831g. Contracts between depository institutions and persons providing goods, products, or services
(a) In general
(b) Rulemaking
(c) Enforcement
(d) No 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 the vendors 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
(Sept. 21, 1950, ch. 967, § 2[30], as added Pub. L. 101–73, title II, § 225, Aug. 9, 1989, 103 Stat. 275; amended Pub. L. 103–325, title VI, § 602(a)(59), Sept. 23, 1994, 108 Stat. 2291.)

CITE AS: 12 USC 1831g

§ 1831h. Repealed. Pub. L. 109–173, § 8(a)(33), Feb. 15, 2006, 119 Stat. 3615

CITE AS: 12 USC 1831h

§ 1831i. Agency disapproval of directors and senior executive officers of insured depository institutions or depository institution holding companies
(a) Prior notice required
An insured depository institution or depository institution holding company shall notify the appropriate Federal banking agency of the proposed addition of any individual to the board of directors or the employment of any individual as a senior executive officer of such institution or holding company at least 30 days (or such other period, as determined by the appropriate Federal banking agency) before such addition or employment becomes effective, if—
(1) the insured depository institution or depository institution holding company is not in compliance with the minimum capital requirement applicable to such institution or is otherwise in a troubled condition, as determined by such agency on the basis of such institution’s or holding company’s most recent report of condition or report of examination or inspection; or
(2) the agency determines, in connection with the review by the agency of the plan required under section 1831o of this title or otherwise, that such prior notice is appropriate.
(b) Disapproval by agency
(c) Exception in extraordinary circumstances
(1) In general
(2) No effect on disapproval authority of agency
(d) Additional information
Any notice submitted to an appropriate Federal banking agency with respect to an individual by any insured depository institution or depository institution holding company pursuant to subsection (a) shall include—
(1) the information described in section 1817(j)(6)(A) of this title about the individual; and
(2) such other information as the agency may prescribe by regulation.
(e) Standard for disapproval
(f) Definition regulations
(Sept. 21, 1950, ch. 967, § 2[32], as added Pub. L. 101–73, title IX, § 914(a), Aug. 9, 1989, 103 Stat. 484; amended Pub. L. 104–208, div. A, title II, § 2209, Sept. 30, 1996, 110 Stat. 3009–409.)

CITE AS: 12 USC 1831i

§ 1831j. Depository institution employee protection remedy
(a) In general
(1) Employees of depository institutions
No insured depository institution may discharge or otherwise discriminate against any employee with respect to compensation, terms, conditions, or privileges of employment because the employee (or any person acting pursuant to the request of the employee) provided information to any Federal banking agency or to the Attorney General regarding—
(A) a possible violation of any law or regulation; or
(B) gross mismanagement, a gross waste of funds, an abuse of authority, or a substantial and specific danger to public health or safety;
by the depository institution or any director, officer, or employee of the institution.
(2) Employees of banking agencies
No Federal banking agency, Federal home loan bank, Federal reserve bank, or any person who is performing, directly or indirectly, any function or service on behalf of the Corporation may discharge or otherwise discriminate against any employee with respect to compensation, terms, conditions, or privileges of employment because the employee (or any person acting pursuant to the request of the employee) provided information to any such agency or bank or to the Attorney General regarding any possible violation of any law or regulation, gross mismanagement, a gross waste of funds, an abuse of authority, or a substantial and specific danger to public health or safety by—
(A) any depository institution or any such bank or agency;
(B) any director, officer, or employee of any depository institution or any such bank;
(C) any officer or employee of the agency which employs such employee; or
(D) the person, or any officer or employee of the person, who employs such employee.
(b) Enforcement
(c) Remedies
If the district court determines that a violation of subsection (a) has occurred, it may order the depository institution, Federal home loan bank, Federal Reserve bank, or Federal banking agency which committed the violation—
(1) to reinstate the employee to his former position;
(2) to pay compensatory damages; or
(3) take other appropriate actions to remedy any past discrimination.
(d) Limitation
The protections of this section shall not apply to any employee who—
(1) deliberately causes or participates in the alleged violation of law or regulation; or
(2) knowingly or recklessly provides substantially false information to such an agency or the Attorney General.
(e) “Federal banking agency” defined
(f) Burdens of proof
(Sept. 21, 1950, ch. 967, § 2[33], as added Pub. L. 101–73, title IX, § 932(a), Aug. 9, 1989, 103 Stat. 494; amended Pub. L. 102–242, title II, § 251(a)(1)–(3), Dec. 19, 1991, 105 Stat. 2331, 2332; Pub. L. 103–204, § 21(a), Dec. 17, 1993, 107 Stat. 2406; Pub. L. 103–325, title VI, § 602(a)(61), (c), Sept. 23, 1994, 108 Stat. 2291; Pub. L. 111–203, title III, § 363(10), July 21, 2010, 124 Stat. 1555.)

CITE AS: 12 USC 1831j

§ 1831k. Reward for information leading to recoveries or civil penalties
(a) In generalAn appropriate Federal banking agency, with the concurrence of the Attorney General, may pay a reward to a person who provides original information which leads to—
(1) recovery of a criminal fine, restitution, or civil penalty—
(A) under—
(i) this chapter;
(ii) the Federal Credit Union Act [12 U.S.C. 1751 et seq.];
(iii) section 93(b), 164, or 481 to 485 of this title;
(iv) the Federal Reserve Act [12 U.S.C. 221 et seq.];
(v) the Bank Holding Company Act Amendments of 1970;
(vi) the Bank Holding Company Act of 1956 [12 U.S.C. 1841 et seq.];
(vii) the Home Owners’ Loan Act [12 U.S.C. 1461 et seq.]; or
(viii)section 3663 of title 18 pursuant to a conviction for an offense referred to in subparagraph (B) of this paragraph,
(B) pursuant to a conviction for an offense under section 215, 656, 657, 1005, 1006, 1007, 1014, 1341, 1343, or 1344 of title 18 affecting a depository institution insured by the Federal Deposit Insurance Corporation, or for a conspiracy to commit such an offense; or
(C) under section 1833a of this title; or
(2) a forfeiture under section 981 or 982 of title 18 that arises in connection with a depository institution insured by the Federal Deposit Insurance Corporation.
(b) Percentage limitation
(c) Officials and persons ineligibleAn appropriate Federal banking agency may not pay a reward under subsection (a) to—
(1) an officer or employee of the United States or of a State or local government who provides information described in subsection (a), obtained in the performance of official duties; or
(2) a person who—
(A) deliberately causes or participates in the alleged violation of law or regulation, or
(B) knowingly or recklessly provides substantially false information to such an agency or the Attorney General.
(d) Nonreviewability
(Sept. 21, 1950, ch. 967, § 2[34], as added Pub. L. 101–73, title IX, § 933(a), Aug. 9, 1989, 103 Stat. 495; amended Pub. L. 101–647, title XXV, § 2586, Nov. 29, 1990, 104 Stat. 4903; Pub. L. 103–325, title VI, § 602(a)(62), (63), Sept. 23, 1994, 108 Stat. 2291.)

CITE AS: 12 USC 1831k

§ 1831l. Coordination of risk analysis between SEC and Federal banking agencies

Any appropriate Federal banking agency shall notify the Securities and Exchange Commission of any concerns of the agency regarding significant financial or operational risks to any registered broker or dealer, or any registered municipal securities dealer, government securities broker, or government securities dealer for which the Commission is the appropriate regulatory agency (as defined in section 78c of title 15), resulting from the activities of any insured depository institution, any depository institution holding company, or any affiliate of any such institution or company if such broker, dealer, municipal securities dealer, government securities broker, or government securities dealer is an affiliate of any such institution, company, or affiliate.

(Sept. 21, 1950, ch. 967, § 2[35], as added Pub. L. 101–432, § 7, Oct. 16, 1990, 104 Stat. 975.)

CITE AS: 12 USC 1831l

§ 1831m. Early identification of needed improvements in financial management
(a) Annual report on financial condition and management
(1) Report required
(2) Contents of reportAny annual report required under paragraph (1) shall contain—
(A) the information required to be provided by—
(i) the institution’s management under subsection (b); and
(ii) an independent public accountant under subsections (c) and (d); and
(B) such other information as the Corporation and the appropriate Federal banking agency may determine to be necessary to assess the financial condition and management of the institution.
(3) Public availability
(b) Management responsibility for financial statements and internal controlsEach insured depository institution shall prepare—
(1) annual financial statements in accordance with generally accepted accounting principles and such other disclosure requirements as the Corporation and the appropriate Federal banking agency may prescribe; and
(2) a report signed by the chief executive officer and the chief accounting or financial officer of the institution which contains—
(A) a statement of the management’s responsibilities for—
(i) preparing financial statements;
(ii) establishing and maintaining an adequate internal control structure and procedures for financial reporting; and
(iii) complying with the laws and regulations relating to safety and soundness which are designated by the Corporation and the appropriate Federal banking agency; and
(B) an assessment, as of the end of the institution’s most recent fiscal year, of—
(i) the effectiveness of such internal control structure and procedures; and
(ii) the institution’s compliance with the laws and regulations relating to safety and soundness which are designated by the Corporation and the appropriate Federal banking agency.
(c) Internal control evaluation and reporting requirements for independent public accountants
(1) In general
(2) Attestation requirements
(d) Annual independent audits of financial statements
(1) Audits required
(2) Scope of auditIn connection with any audit under this subsection, the independent public accountant shall determine and report whether the financial statements of the institution—
(A) are presented fairly in accordance with generally accepted accounting principles; and
(B) comply with such other disclosure requirements as the Corporation and the appropriate Federal banking agency may prescribe.
(3) Requirements for insured subsidiaries of holding companies
(e) Repealed. Pub. L. 104–208, div. A, title II, § 2301(a), Sept. 30, 1996, 110 Stat. 3009–419
(f) Form and span of reports and auditing standards
(1) In general
(2) Consultation
(g) Improved accountability
(1) Independent audit committee
(A) Establishment
(B) Duties
(C) Criteria applicable to committees of large insured depository institutionsIn the case of each insured depository institution which the Corporation determines to be a large institution, the audit committee required by subparagraph (A) shall—
(i) include members with banking or related financial management expertise;
(ii) have access to the committee’s own outside counsel; and
(iii) not include any large customers of the institution.
(D) Exemption authority
(i) In general
(ii) Factors to be considered
(2) Review of quarterly reports of large insured depository institutions
(A) In general
(B) Report to audit committee
(C) Limitation on notice
(D) Notice to institution
(3) Qualifications of independent public accountants
(A) In generalAll audit services required by this section shall be performed only by an independent public accountant who—
(i) has agreed to provide related working papers, policies, and procedures to the Corporation, any appropriate Federal banking agency, and any State bank supervisor, if requested; and
(ii) has received a peer review that meets guidelines acceptable to the Corporation.
(B) Reports on peer reviews
(4) Enforcement actions
(A) In general
(B) Joint rulemaking
(5) Notice by accountant of termination of services
(h) Exchange of reports and information
(1) Report to the independent auditor
(A) In general
(B) Additional informationIn addition to the copies of the reports required to be provided under subparagraph (A), each insured depository institution shall provide the auditor with—
(i) a copy of any supervisory memorandum of understanding with such institution and any written agreement between such institution and any appropriate Federal banking agency or any appropriate State bank supervisor which is in effect during the period covered by the audit; and
(ii) a report of—(I) any action initiated or taken by the appropriate Federal banking agency or the Corporation during such period under subsection (a), (b), (c), (e), (g), (i), (s), or (t) of section 1818 of this title;(II) any action taken by any appropriate State bank supervisor under State law which is similar to any action referred to in subclause (I); or(III) any assessment of any civil money penalty under any other provision of law with respect to the institution or any institution-affiliated party.
(2) Reports to banking agencies
(A) Independent auditor reports
(B) Notice of change of auditor
(i) Requirements for insured subsidiaries of holding companies
(1) In generalExcept with respect to any audit requirements established under or pursuant to subsection (d), the requirements of this section may be satisfied for insured depository institutions that are subsidiaries of a holding company, if—
(A) services and functions comparable to those required under this section are provided at the holding company level; and
(B) the institution—
(i) has total assets, as of the beginning of such fiscal year, of less than $5,000,000,000; or
(ii) has—(I) total assets, as of the beginning of such fiscal year, of $5,000,000,000, or more; and(II) a CAMEL composite rating of 1 or 2 under the Uniform Financial Institutions Rating System (or an equivalent rating by any such agency under a comparable rating system) as of the most recent examination of such institution by the Corporation or the appropriate Federal banking agency.
(2) Large institutions
(3) Applicability based on risk to fund
(j) Exemption for small depository institutionsThis section shall not apply with respect to any fiscal year of any insured depository institution the total assets of which, as of the beginning of such fiscal year, are less than the greater of—
(1) $150,000,000; or
(2) such amount (in excess of $150,000,000) as the Corporation may prescribe by regulation.
(Sept. 21, 1950, ch. 967, § 2[36], as added Pub. L. 102–242, title I, § 112(a), Dec. 19, 1991, 105 Stat. 2242; amended Pub. L. 102–550, title XVI, § 1603(b)(3), Oct. 28, 1992, 106 Stat. 4079; Pub. L. 103–325, title III, § 314, Sept. 23, 1994, 108 Stat. 2221; Pub. L. 104–208, div. A, title II, §§ 2301, 2704(d)(14)(Z), Sept. 30, 1996, 110 Stat. 3009–419, 3009–494; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 8(a)(34), Feb. 15, 2006, 119 Stat. 3615.)

CITE AS: 12 USC 1831m

§ 1831m–1. Reports of information regarding safety and soundness of depository institutions
(a) Reports to appropriate Federal banking agencies
(1) In general
(2) Exceptions
(A) Intelligence information
(i) In general
(ii) Procedures for receipt of intelligence information
(B) Criminal investigations, safety of Government investigators, informants, and witnesses
If the Attorney General, the Secretary of the Treasury or their respective designees determines that the disclosure of information pursuant to paragraph (1) may jeopardize a pending civil investigation or litigation, or a pending criminal investigation or prosecution, may result in serious bodily injury or death to Government employees, informants, witnesses or their respective families, or may disclose sensitive investigative techniques and methods, the Attorney General or the Secretary of the Treasury shall—
(i) provide the appropriate Federal banking agency a description of the information that is as specific as possible without jeopardizing the investigation, litigation, or prosecution, threatening serious bodily injury or death to Government employees, informants, or witnesses or their respective families, or disclosing sensitive investigation techniques and methods; and
(ii) permit a full review of the information by the Federal banking agency at a location and under procedures that the Attorney General determines will ensure the effective protection of the information while permitting the Federal banking agency to ensure the safety and soundness of any depository institution.
(C) Grand jury investigations; criminal procedure
Paragraph (1) shall not—
(i) apply to the receipt of information by an agency or instrumentality in connection with a pending grand jury investigation; or
(ii) be construed to require disclosure of information prohibited by rule 6 of the Federal Rules of Criminal Procedure.
(b) Procedures for receipt of disclosure reports
(1) In general
(2) Procedures related to each disclosure report
Upon receipt of a report in accordance with subsection (a)(1), the appropriate Federal banking agency shall—
(A) consult with the agency or instrumentality that made the disclosure regarding the adequacy of the procedures established pursuant to paragraph (1), and
(B) adjust the procedures to ensure adequate protection of the information disclosed.
(c) Effect on agencies
(d) Definitions
(Pub. L. 102–550, title XV, § 1542, Oct. 28, 1992, 106 Stat. 4067; Pub. L. 105–362, title X, § 1001(f), Nov. 10, 1998, 112 Stat. 3292.)

CITE AS: 12 USC 1831m-1

§ 1831n. Accounting objectives, standards, and requirements
(a) In general
(1) Objectives
Accounting principles applicable to reports or statements required to be filed with Federal banking agencies by insured depository institutions should—
(A) result in financial statements and reports of condition that accurately reflect the capital of such institutions;
(B) facilitate effective supervision of the institutions; and
(C) facilitate prompt corrective action to resolve the institutions at the least cost to the Deposit Insurance Fund.
(2) Standards
(A) Uniform accounting principles consistent with GAAP
(B) Stringency
(3) Review and implementation of accounting principles required
Before the end of the 1-year period beginning on December 19, 1991, each appropriate Federal banking agency shall take the following actions:
(A) Review of accounting principles
Review—
(i) all accounting principles used by depository institutions with respect to reports or statements required to be filed with a Federal banking agency;
(ii) all requirements established by the agency with respect to such accounting procedures; and
(iii) the procedures and format for reports to the agency, including reports of condition.
(B) Modification of noncomplying measures
(C) Inclusion of “off balance sheet” items
(b) Uniform accounting of capital standards
(1) In general
(2) Transition provision
(c) Reports to banking committees
(1) Annual reports required
(2) Explanation of reasons for discrepancy
(3) Publication
(Sept. 21, 1950, ch. 967, § 2[37], as added Pub. L. 102–242, title I, § 121(a), Dec. 19, 1991, 105 Stat. 2250; amended Pub. L. 106–569, title XII, §§ 1221, 1223, Dec. 27, 2000, 114 Stat. 3036; Pub. L. 109–173, § 8(a)(35), Feb. 15, 2006, 119 Stat. 3615.)

CITE AS: 12 USC 1831n

§ 1831o. Prompt corrective action
(a) Resolving problems to protect Deposit Insurance Fund
(1) Purpose
(2) Prompt corrective action required
(b) DefinitionsFor purposes of this section:
(1) Capital categories
(A) Well capitalized
(B) Adequately capitalized
(C) Undercapitalized
(D) Significantly undercapitalized
(E) Critically undercapitalized
(2) Other definitions
(A) Average
(i) In general
(ii) Agency may permit weekly averaging for certain institutions
(B) Capital distributionThe term “capital distribution” means—
(i) a distribution of cash or other property by any insured depository institution or company to its owners made on account of that ownership, but not including—(I) any dividend consisting only of shares of the institution or company or rights to purchase such shares; or(II) any amount paid on the deposits of a mutual or cooperative institution that the appropriate Federal banking agency determines is not a distribution for purposes of this section;
(ii) a payment by an insured depository institution or company to repurchase, redeem, retire, or otherwise acquire any of its shares or other ownership interests, including any extension of credit to finance an affiliated company’s acquisition of those shares or interests; or
(iii) a transaction that the appropriate Federal banking agency or the Corporation determines, by order or regulation, to be in substance a distribution of capital to the owners of the insured depository institution or company.
(C) Capital restoration plan
(D) Company
(E) Compensation
(F) Relevant capital measure
(G) Required minimum level
(H) Senior executive officer
(I) Subordinated debt
(c) Capital standards
(1) Relevant capital measures
(A) In generalExcept as provided in subparagraph (B)(ii), the capital standards prescribed by each appropriate Federal banking agency shall include—
(i) a leverage limit; and
(ii) a risk-based capital requirement.
(B) Other capital measuresAn appropriate Federal banking agency may, by regulation—
(i) establish any additional relevant capital measures to carry out the purpose of this section; or
(ii) rescind any relevant capital measure required under subparagraph (A) upon determining (with the concurrence of the other Federal banking agencies) that the measure is no longer an appropriate means for carrying out the purpose of this section.
(2) Capital categories generally
(3) Critical capital
(A) Agency to specify level
(i) Leverage limit
(ii) Other relevant capital measures
(B) Leverage limit rangeThe level specified under subparagraph (A)(i) shall require tangible equity in an amount—
(i) not less than 2 percent of total assets; and
(ii) except as provided in clause (i), not more than 65 percent of the required minimum level of capital under the leverage limit.
(C) FDIC’s concurrence required
(d) Provisions applicable to all institutions
(1) Capital distributions restricted
(A) In general
(B) ExceptionNotwithstanding subparagraph (A), the appropriate Federal banking agency may permit, after consultation with the Corporation, an insured depository institution to repurchase, redeem, retire, or otherwise acquire shares or ownership interests if the repurchase, redemption, retirement, or other acquisition—
(i) is made in connection with the issuance of additional shares or obligations of the institution in at least an equivalent amount; and
(ii) will reduce the institution’s financial obligations or otherwise improve the institution’s financial condition.
(2) Management fees restricted
(e) Provisions applicable to undercapitalized institutions
(1) Monitoring requiredEach appropriate Federal banking agency shall—
(A) closely monitor the condition of any undercapitalized insured depository institution;
(B) closely monitor compliance with capital restoration plans, restrictions, and requirements imposed under this section; and
(C) periodically review the plan, restrictions, and requirements applicable to any undercapitalized insured depository institution to determine whether the plan, restrictions, and requirements are achieving the purpose of this section.
(2) Capital restoration plan required
(A) In general
(B) Contents of planThe capital restoration plan shall—
(i) specify—(I) the steps the insured depository institution will take to become adequately capitalized;(II) the levels of capital to be attained during each year in which the plan will be in effect;(III) how the institution will comply with the restrictions or requirements then in effect under this section; and(IV) the types and levels of activities in which the institution will engage; and
(ii) contain such other information as the appropriate Federal banking agency may require.
(C) Criteria for accepting planThe appropriate Federal banking agency shall not accept a capital restoration plan unless the agency determines that—
(i) the plan—(I) complies with subparagraph (B);(II) is based on realistic assumptions, and is likely to succeed in restoring the institution’s capital; and(III) would not appreciably increase the risk (including credit risk, interest-rate risk, and other types of risk) to which the institution is exposed; and
(ii) if the insured depository institution is undercapitalized, each company having control of the institution has—(I) guaranteed that the institution will comply with the plan until the institution has been adequately capitalized on average during each of 4 consecutive calendar quarters; and(II) provided appropriate assurances of performance.
(D) Deadlines for submission and review of plansThe appropriate Federal banking agency shall by regulation establish deadlines that—
(i) provide insured depository institutions with reasonable time to submit capital restoration plans, and generally require an institution to submit a plan not later than 45 days after the institution becomes undercapitalized;
(ii) require the agency to act on capital restoration plans expeditiously, and generally not later than 60 days after the plan is submitted; and
(iii) require the agency to submit a copy of any plan approved by the agency to the Corporation before the end of the 45-day period beginning on the date such approval is granted.
(E) Guarantee liability limited
(i) In generalThe aggregate liability under subparagraph (C)(ii) of all companies having control of an insured depository institution shall be the lesser of—(I) an amount equal to 5 percent of the institution’s total assets at the time the institution became undercapitalized; or(II) the amount which is necessary (or would have been necessary) to bring the institution into compliance with all capital standards applicable with respect to such institution as of the time the institution fails to comply with a plan under this subsection.
(ii) Certain affiliates not affectedThis paragraph may not be construed as—(I) requiring any company not having control of an undercapitalized insured depository institution to guarantee, or otherwise be liable on, a capital restoration plan;(II) requiring any person other than an insured depository institution to submit a capital restoration plan; or(III) affecting compliance by brokers, dealers, government securities brokers, and government securities dealers with the financial responsibility requirements of the Securities Exchange Act of 1934 [15 U.S.C. 78a et seq.] and regulations and orders thereunder.
(3) Asset growth restrictedAn undercapitalized insured depository institution shall not permit its average total assets during any calendar quarter to exceed its average total assets during the preceding calendar quarter unless—
(A) the appropriate Federal banking agency has accepted the institution’s capital restoration plan;
(B) any increase in total assets is consistent with the plan; and
(C) the institution’s ratio of tangible equity to assets increases during the calendar quarter at a rate sufficient to enable the institution to become adequately capitalized within a reasonable time.
(4) Prior approval required for acquisitions, branching, and new lines of businessAn undercapitalized insured depository institution shall not, directly or indirectly, acquire any interest in any company or insured depository institution, establish or acquire any additional branch office, or engage in any new line of business unless—
(A) the appropriate Federal banking agency has accepted the insured depository institution’s capital restoration plan, the institution is implementing the plan, and the agency determines that the proposed action is consistent with and will further the achievement of the plan; or
(B) the Board of Directors determines that the proposed action will further the purpose of this section.
(5) Discretionary safeguards
(f) Provisions applicable to significantly undercapitalized institutions and undercapitalized institutions that fail to submit and implement capital restoration plans
(1) In generalThis subsection shall apply with respect to any insured depository institution that—
(A) is significantly undercapitalized; or
(B) is undercapitalized and—
(i) fails to submit an acceptable capital restoration plan within the time allowed by the appropriate Federal banking agency under subsection (e)(2)(D); or
(ii) fails in any material respect to implement a plan accepted by the agency.
(2) Specific actions authorizedThe appropriate Federal banking agency shall carry out this section by taking 1 or more of the following actions:
(A) Requiring recapitalizationDoing 1 or more of the following:
(i) Requiring the institution to sell enough shares or obligations of the institution so that the institution will be adequately capitalized after the sale.
(ii) Further requiring that instruments sold under clause (i) be voting shares.
(iii) Requiring the institution to be acquired by a depository institution holding company, or to combine with another insured depository institution, if 1 or more grounds exist for appointing a conservator or receiver for the institution.
(B) Restricting transactions with affiliates
(i) Requiring the institution to comply with section 371c of this title as if subsection (d)(1) of that section (exempting transactions with certain affiliated institutions) did not apply.
(ii) Further restricting the institution’s transactions with affiliates.
(C) Restricting interest rates paid
(i) In general
(ii) Retroactive restrictions prohibited
(D) Restricting asset growth
(E) Restricting activities
(F) Improving managementDoing 1 or more of the following:
(i) New election of directors
(ii) Dismissing directors or senior executive officers
(iii) Employing qualified senior executive officers
(G) Prohibiting deposits from correspondent banks
(H) Requiring prior approval for capital distributions by bank holding company
(I) Requiring divestitureDoing one or more of the following:
(i) Divestiture by the institution
(ii) Divestiture by parent company of nondepository affiliate
(iii) Divestiture of institution
(J) Requiring other action
(3) Presumption in favor of certain actionsIn complying with paragraph (2), the agency shall take the following actions, unless the agency determines that the actions would not further the purpose of this section:
(A) The action described in clause (i) or (iii) of paragraph (2)(A) (relating to requiring the sale of shares or obligations, or requiring the institution to be acquired by or combine with another institution).
(B) The action described in paragraph (2)(B)(i) (relating to restricting transactions with affiliates).
(C) The action described in paragraph (2)(C) (relating to restricting interest rates).
(4) Senior executive officers’ compensation restricted
(A) In generalThe insured depository institution shall not do any of the following without the prior written approval of the appropriate Federal banking agency:
(i) Pay any bonus to any senior executive officer.
(ii) Provide compensation to any senior executive officer at a rate exceeding that officer’s average rate of compensation (excluding bonuses, stock options, and profit-sharing) during the 12 calendar months preceding the calendar month in which the institution became undercapitalized.
(B) Failing to submit plan
(5) Discretion to impose certain additional restrictions
(6) Consultation with other regulators
(g) More stringent treatment based on other supervisory criteria
(1) In generalIf the appropriate Federal banking agency determines (after notice and an opportunity for hearing) that an insured depository institution is in an unsafe or unsound condition or, pursuant to section 1818(b)(8) of this title, deems the institution to be engaging in an unsafe or unsound practice, the agency may—
(A) if the institution is well capitalized, reclassify the institution as adequately capitalized;
(B) if the institution is adequately capitalized (but not well capitalized), require the institution to comply with 1 or more provisions of subsections (d) and (e), as if the institution were undercapitalized; or
(C) if the institution is undercapitalized, take any 1 or more actions authorized under subsection (f)(2) as if the institution were significantly undercapitalized.
(2) Contents of plan
(h) Provisions applicable to critically undercapitalized institutions
(1) Activities restricted
(2) Payments on subordinated debt prohibited
(A) In general
(B) ExceptionsThe Corporation may make exceptions to subparagraph (A) if—
(i) the appropriate Federal banking agency has taken action with respect to the insured depository institution under paragraph (3)(A)(ii); and
(ii) the Corporation determines that the exception would further the purpose of this section.
(C) Limited exemption for certain subordinated debt
(D) Accrual of interest
(3) Conservatorship, receivership, or other action required
(A) In generalThe appropriate Federal banking agency shall, not later than 90 days after an insured depository institution becomes critically undercapitalized—
(i) appoint a receiver (or, with the concurrence of the Corporation, a conservator) for the institution; or
(ii) take such other action as the agency determines, with the concurrence of the Corporation, would better achieve the purpose of this section, after documenting why the action would better achieve that purpose.
(B) Periodic redeterminations required
(C) Appointment of receiver required if other action fails to restore capital
(i) In general
(ii) ExceptionNotwithstanding clause (i), the appropriate Federal banking agency may continue to take such other action as the agency determines to be appropriate in lieu of such appointment if—(I) the agency determines, with the concurrence of the Corporation, that (aa) the insured depository institution has positive net worth, (bb) the insured depository institution has been in substantial compliance with an approved capital restoration plan which requires consistent improvement in the institution’s capital since the date of the approval of the plan, (cc) the insured depository institution is profitable or has an upward trend in earnings the agency projects as sustainable, and (dd) the insured depository institution is reducing the ratio of nonperforming loans to total loans; and(II) the head of the appropriate Federal banking agency and the Chairperson of the Board of Directors both certify that the institution is viable and not expected to fail.
(i) Restricting activities of critically undercapitalized institutionsTo carry out the purpose of this section, the Corporation shall, by regulation or order—
(1) restrict the activities of any critically undercapitalized insured depository institution; and
(2) at a minimum, prohibit any such institution from doing any of the following without the Corporation’s prior written approval:
(A) Entering into any material transaction other than in the usual course of business, including any investment, expansion, acquisition, sale of assets, or other similar action with respect to which the depository institution is required to provide notice to the appropriate Federal banking agency.
(B) Extending credit for any highly leveraged transaction.
(C) Amending the institution’s charter or bylaws, except to the extent necessary to carry out any other requirement of any law, regulation, or order.
(D) Making any material change in accounting methods.
(E) Engaging in any covered transaction (as defined in section 371c(b) of this title).
(F) Paying excessive compensation or bonuses.
(G) Paying interest on new or renewed liabilities at a rate that would increase the institution’s weighted average cost of funds to a level significantly exceeding the prevailing rates of interest on insured deposits in the institution’s normal market areas.
(j) Certain Government-controlled institutions exemptedSubsections (e) through (i) (other than paragraph (3) of subsection (e)) shall not apply—
(1) to an insured depository institution for which the Corporation or the Resolution Trust Corporation is conservator; or
(2) to a bridge depository institution, none of the voting securities of which are owned by a person or agency other than the Corporation or the Resolution Trust Corporation.
(k) Reviews required when Deposit Insurance Fund incurs losses
(1) In generalIf the Deposit Insurance Fund incurs a material loss with respect to an insured depository institution on or after July 1, 1993, the inspector general of the appropriate Federal banking agency shall—
(A) make a written report to that agency reviewing the agency’s supervision of the institution (including the agency’s implementation of this section), which shall—
(i) ascertain why the institution’s problems resulted in a material loss to the Deposit Insurance Fund; and
(ii) make recommendations for preventing any such loss in the future; and
(B) provide a copy of the report to—
(i) the Comptroller General of the United States;
(ii) the Corporation (if the agency is not the Corporation);
(iii) in the case of a State depository institution, the appropriate State banking supervisor; and
(iv) upon request by any Member of Congress, to that Member.
(2) Material loss incurredFor purposes of this subsection:
(A) Loss incurredThe Deposit Insurance Fund incurs a loss with respect to an insured depository institution—
(i) if the Corporation provides any assistance under section 1823(c) of this title with respect to that institution; and—(I) it is not substantially certain that the assistance will be fully repaid not later than 24 months after the date on which the Corporation initiated the assistance; or(II) the institution ceases to repay the assistance in accordance with its terms; or
(ii) if the Corporation is appointed receiver of the institution, and it is or becomes apparent that the present value of the outlays of the Deposit Insurance Fund with respect to that institution will exceed the present value of receivership dividends or other payments on the claims held by the Corporation.
(B) Material loss definedThe term “material loss” means any estimated loss in excess of—
(i) $200,000,000, if the loss occurs during the period beginning on January 1, 2010, and ending on December 31, 2011;
(ii) $150,000,000, if the loss occurs during the period beginning on January 1, 2012, and ending on December 31, 2013; and
(iii) $50,000,000, if the loss occurs on or after January 1, 2014, provided that if the inspector general of a Federal banking agency certifies to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives that the number of projected failures of depository institutions that would require material loss reviews for the following 12 months will be greater than 30 and would hinder the effectiveness of its oversight functions, then the definition of “material loss” shall be $75,000,000 for a duration of 1 year from the date of the certification.
(3) Deadline for reportThe inspector general of the appropriate Federal banking agency shall comply with paragraph (1) expeditiously, and in any event (except with respect to paragraph (1)(B)(iv)) as follows:
(A) If the institution is described in paragraph (2)(A)(i), during the 6-month period beginning on the earlier of—
(i) the date on which the institution ceases to repay assistance under section 1823(c) of this title in accordance with its terms, or
(ii) the date on which it becomes apparent that the assistance will not be fully repaid during the 24-month period described in paragraph (2)(A)(i).
(B) If the institution is described in paragraph (2)(A)(ii), during the 6-month period beginning on the date on which it becomes apparent that the present value of the outlays of the Deposit Insurance Fund with respect to that institution will exceed the present value of receivership dividends or other payments on the claims held by the Corporation.
(4) Public disclosure required
(A) In generalThe appropriate Federal banking agency shall disclose any report on losses required under this subsection, upon request under section 552 of title 5 without excising—
(i) any portion under section 552(b)(5) of that title; or
(ii) any information about the insured depository institution under paragraph (4) (other than trade secrets) or paragraph (8) of section 552(b) of that title.
(B) Exception
(5) Losses that are not material
(A) Semiannual reportFor the 6-month period ending on March 31, 2010, and each 6-month period thereafter, the Inspector General of each Federal banking agency shall—
(i) identify losses that the Inspector General estimates have been incurred by the Deposit Insurance Fund during that 6-month period, with respect to the insured depository institutions supervised by the Federal banking agency;
(ii) for each loss incurred by the Deposit Insurance Fund that is not a material loss, determine—(I) the grounds identified by the Federal banking agency or State bank supervisor for appointing the Corporation as receiver under section 1821(c)(5) of this title; and(II) whether any unusual circumstances exist that might warrant an in-depth review of the loss; and
(iii) prepare and submit a written report to the appropriate Federal banking agency and to Congress on the results of any determination by the Inspector General, including—(I) an identification of any loss that warrants an in-depth review, together with the reasons why such review is warranted, or, if the Inspector General determines that no review is warranted, an explanation of such determination; and(II) for each loss identified under subclause (I) that warrants an in-depth review, the date by which such review, and a report on such review prepared in a manner consistent with reports under paragraph (1)(A), will be completed and submitted to the Federal banking agency and Congress.
(B) Deadline for semiannual reportThe Inspector General of each Federal banking agency shall—
(i) submit each report required under paragraph (A) expeditiously, and not later than 90 days after the end of the 6-month period covered by the report; and
(ii) provide a copy of the report required under paragraph (A) to any Member of Congress, upon request.
(6) GAO review
(l) Implementation
(1) Regulations and other actions
(2) Written determination and concurrence required
(m) Other authority not affected
(n) Administrative review of dismissal orders
(1) Timely petition required
(2) Procedure
(A) Hearing requiredThe agency shall give the petitioner an opportunity to—
(i) submit written materials in support of the petition; and
(ii) appear, personally or through counsel, before 1 or more members of the agency or designated employees of the agency.
(B) Deadline for hearingThe agency shall—
(i) schedule the hearing referred to in subparagraph (A)(ii) promptly after the petition is filed; and
(ii) hold the hearing not later than 30 days after the petition is filed, unless the petitioner requests that the hearing be held at a later time.
(C) Deadline for decisionNot later than 60 days after the date of the hearing, the agency shall—
(i) by order, grant or deny the petition;
(ii) if the order is adverse to the petitioner, set forth the basis for the order; and
(iii) notify the petitioner of the order.
(3) Standard for review of dismissal ordersThe petitioner shall bear the burden of proving that the petitioner’s continued employment would materially strengthen the insured depository institution’s ability—
(A) to become adequately capitalized, to the extent that the order is based on the institution’s capital level or failure to submit or implement a capital restoration plan; and
(B) to correct the unsafe or unsound condition or unsafe or unsound practice, to the extent that the order is based on subsection (g)(1).
(o) Transition rules for savings associationsSubsections (e)(2), (f), and (h) shall not apply before July 1, 1994, to any insured savings association if—
(1) before December 19, 1991—
(A) the savings association had submitted a plan meeting the requirements of section 1464(t)(6)(A)(ii) of this title; and
(B) the Director of the Office of Thrift Supervision had accepted the plan;
(2) the plan remains in effect; and
(3) the savings association remains in compliance with the plan or is operating under a written agreement with the appropriate Federal banking agency.
(Sept. 21, 1950, ch. 967, § 2[38], as added Pub. L. 102–242, title I, § 131(a), Dec. 19, 1991, 105 Stat. 2253; amended Pub. L. 102–550, title XVI, § 1603(d)(1), Oct. 28, 1992, 106 Stat. 4079; Pub. L. 103–325, title VI, § 602(a)(64), Sept. 23, 1994, 108 Stat. 2291; Pub. L. 104–208, div. A, title II, § 2704(d)(14)(AA)–(CC), Sept. 30, 1996, 110 Stat. 3009–494; Pub. L. 104–316, title I, § 106(d), Oct. 19, 1996, 110 Stat. 3831; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 8(a)(36)–(39), Feb. 15, 2006, 119 Stat. 3615; Pub. L. 110–289, div. A, title VI, § 1604(b)(1)(D), July 30, 2008, 122 Stat. 2829; Pub. L. 111–203, title IX, § 987, July 21, 2010, 124 Stat. 1936.)

CITE AS: 12 USC 1831o

§ 1831o–1. Source of strength
(a) Holding companies
(b) Other companies
(c) Authority of State insurance regulator
(1) In general
(2) Rule of construction
(d) Reports
The appropriate Federal banking agency for an insured depository institution described in subsection (b) may, from time to time, require the company, or a company that directly or indirectly controls the insured depository institution, to submit a report, under oath, for the purposes of—
(1) assessing the ability of such company to comply with the requirement under subsection (b); and
(2) enforcing the compliance of such company with the requirement under subsection (b).
(e) Rules
(f) Definition
(Sept. 21, 1950, ch. 967, § 2[38A], as added Pub. L. 111–203, title VI, § 616(d), July 21, 2010, 124 Stat. 1616; amended Pub. L. 114–113, div. O, title VII, § 706(a), Dec. 18, 2015, 129 Stat. 3029.)

CITE AS: 12 USC 1831o-1

§ 1831p. Transferred

CITE AS: 12 USC 1831p

§ 1831p–1. Standards for safety and soundness
(a) Operational and managerial standardsEach appropriate Federal banking agency shall, for all insured depository institutions, prescribe—
(1) standards relating to—
(A) internal controls, information systems, and internal audit systems, in accordance with section 1831m of this title;
(B) loan documentation;
(C) credit underwriting;
(D) interest rate exposure;
(E) asset growth; and
(F) compensation, fees, and benefits, in accordance with subsection (c); and
(2) such other operational and managerial standards as the agency determines to be appropriate.
(b) Asset quality, earnings, and stock valuation standards
(c) Compensation standardsEach appropriate Federal banking agency shall, for all insured depository institutions, prescribe—
(1) standards prohibiting as an unsafe and unsound practice any employment contract, compensation or benefit agreement, fee arrangement, perquisite, stock option plan, post­employment benefit, or other compensatory arrangement that—
(A) would provide any executive officer, employee, director, or principal shareholder of the institution with excessive compensation, fees or benefits; or
(B) could lead to material financial loss to the institution;
(2) standards specifying when compensation, fees, or benefits referred to in paragraph (1) are excessive, which shall require the agency to determine whether the amounts are unreasonable or disproportionate to the services actually performed by the individual by considering—
(A) the combined value of all cash and noncash benefits provided to the individual;
(B) the compensation history of the individual and other individuals with comparable expertise at the institution;
(C) the financial condition of the institution;
(D) comparable compensation practices at comparable institutions, based upon such factors as asset size, geographic location, and the complexity of the loan portfolio or other assets;
(E) for postemployment benefits, the projected total cost and benefit to the institution;
(F) any connection between the individual and any fraudulent act or omission, breach of trust or fiduciary duty, or insider abuse with regard to the institution; and
(G) other factors that the agency determines to be relevant; and
(3) such other standards relating to compensation, fees, and benefits as the agency determines to be appropriate.
(d) Standards to be prescribed
(1) In general
(2) Applicability of other laws
(3) Senior executive officers at undercapitalized institutions
(4) Safety and soundness or enforcement actionsParagraph (1) shall not be construed as affecting the authority of any appropriate Federal banking agency under any provision of this chapter other than this section, or under any other provision of law, to prescribe a specific level or range of compensation for any director, officer, or employee of an insured depository institution—
(A) to preserve the safety and soundness of the institution; or
(B) in connection with any action under section 1818 of this title or any order issued by the agency, any agreement between the agency and the institution, or any condition imposed by the agency in connection with the agency’s approval of an application or other request by the institution, which is enforceable under section 1818 of this title.
(e) Failure to meet standards
(1) Plan required
(A) In generalIf the appropriate Federal banking agency determines that an insured depository institution fails to meet any standard prescribed under subsection (a) or (b)—
(i) if such standard is prescribed by regulation of the agency, the agency shall require the institution to submit an acceptable plan to the agency within the time allowed by the agency under subparagraph (C); and
(ii) if such standard is prescribed by guideline, the agency may require the institution to submit a plan described in clause (i).
(B) Contents of plan
(C) Deadlines for submission and review of plansThe appropriate Federal banking agency shall by regulation establish deadlines that—
(i) provide institutions with reasonable time to submit plans required under subparagraph (A), and generally require the institution to submit a plan not later than 30 days after the agency determines that the institution fails to meet any standard prescribed under subsection (a), (b), or (c); and
(ii) require the agency to act on plans expeditiously, and generally not later than 30 days after the plan is submitted.
(2) Order required if institution fails to submit or implement planIf an insured depository institution fails to submit an acceptable plan within the time allowed under paragraph (1)(C), or fails in any material respect to implement a plan accepted by the appropriate Federal banking agency, the agency, by order—
(A) shall require the institution to correct the deficiency; and
(B) may do 1 or more of the following until the deficiency has been corrected:
(i) Prohibit the institution from permitting its average total assets during any calendar quarter to exceed its average total assets during the preceding calendar quarter, or restrict the rate at which the average total assets of the institution may increase from one calendar quarter to another.
(ii) Require the institution to increase its ratio of tangible equity to assets.
(iii) Take the action described in section 1831o(f)(2)(C) of this title.
(iv) Require the institution to take any other action that the agency determines will better carry out the purpose of section 1831o of this title than any of the actions described in this subparagraph.
(3) Restrictions mandatory for certain institutionsIn complying with paragraph (2), the appropriate Federal banking agency shall take 1 or more of the actions described in clauses (i) through (iii) of paragraph (2)(B) if—
(A) the agency determines that the insured depository institution fails to meet any standard prescribed under subsection (a)(1) or (b)(1);
(B) the institution has not corrected the deficiency; and
(C) either—
(i) during the 24-month period before the date on which the institution first failed to meet the standard—(I) the institution commenced operations; or(II) 1 or more persons acquired control of the institution; or
(ii) during the 18-month period before the date on which the institution first failed to meet the standard, the institution underwent extraordinary growth, as defined by the agency.
(f) Definitions
(g) Other authority not affected
(Sept. 21, 1950, ch. 967, § 2[39], as added Pub. L. 102–242, title I, § 132(a), Dec. 19, 1991, 105 Stat. 2267; amended Pub. L. 102–550, title IX, § 956, Oct. 28, 1992, 106 Stat. 3895; Pub. L. 103–325, title III, § 318(a)–(c), Sept. 23, 1994, 108 Stat. 2223, 2224.)

CITE AS: 12 USC 1831p-1

§ 1831q. FDIC affordable housing program
(a) Purpose
(b) Funding and limitations of program
(1) Duration of program
(2) Annual fiscal limitations
(A) In generalIn each fiscal year during the 3-year period referred to in paragraph (1), the provisions of this section shall apply only—
(i) to such extent or in such amounts as are provided in appropriations Acts for any losses resulting during the fiscal year from the sale of properties under this section, except that such amounts for losses may not exceed $30,000,000 in any fiscal year; and
(ii) to the extent that amounts are provided in appropriations Acts pursuant to subparagraph (C) for any other costs relating to the program under this section.
(B)
(C) Authorization of appropriations
(D) Other definitionsFor purposes of this paragraph:
(i) Affordable housing discount
(ii) Realizable disposition value
(3) Existing contracts
(c) Rules governing disposition of eligible single family properties
(1) Notice to clearinghouses
(2) Offers to sell to nonprofit organizations, public agencies, and qualifying householdsDuring the 180-day period beginning on the date on which the Corporation makes an eligible single family property available for sale, the Corporation shall offer to sell the property to—
(A) qualifying households (including qualifying households with members who are veterans); or
(B) public agencies or nonprofit organizations that agree to (i) make the property available for occupancy by and maintain it as affordable for low-income families (including low-income families with members who are veterans) for the remaining useful life of such property, or (ii) make the property available for purchase by any such family who, except as provided in paragraph (4), agrees to occupy the property as a principal residence for at least 12 months and certifies in writing that the family intends to occupy the property for at least 12 months.
The restrictions described in clause (i) of subparagraph (B) shall be contained in the deed or other recorded instrument. If, upon the expiration of such 180-day 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 low-income families and to low-income families with members who are veterans.
(3) Recapture of profits from resale
(4) Exceptions to recapture requirement
(A) Relocation
(B) Other recapture provisions
(5) Exception to avoid displacement of existing residents
(d) Rules governing disposition of eligible multifamily housing properties
(1) Notice to clearinghouses
(2) Expression of serious interest
(3) Notice of readiness for sale
(4) Offers by qualifying multifamily purchasers
(5) Extension of restricted offer periodsThe Corporation may provide notice to clearinghouses regarding, and offer for sale under the provisions of paragraphs (1) through (4), any eligible multifamily housing property—
(A) in which no qualifying multifamily purchaser has expressed serious interest during the period referred to in paragraph (2), or
(B) for which no qualifying multifamily purchaser has made a bona fide offer before the expiration of the period referred to in paragraph (4),
except that the Corporation may, in the discretion of the Corporation, alter the duration of the periods referred to in paragraphs (2) and (4) in offering any property for sale under this paragraph.
(6) Sale of multifamily properties to other purchasers
(A) Timing
(B) Limitation on combination sales
(C) Expiration of offer period
(7) Low-income occupancy requirements
(A) Single property purchasesWith respect to any purchase of a single eligible multifamily housing property by a qualifying multifamily purchaser under paragraph (4) or (5)—
(i) not less than 35 percent of all dwelling units purchased shall be made available for occupancy by and maintained as affordable for low-income and very low-income families during the remaining useful life of the property in which the units are located; provided that
(ii) not less than 20 percent of all dwelling units purchased shall be made available for occupancy by and maintained as affordable for very low-income families during the remaining useful life of the property in which the units are located.
(B) Aggregation requirements for multiproperty purchasesWith respect to any purchase under paragraph (4) or (5) by a qualifying multifamily purchaser involving more than one eligible multifamily housing property as a part of the same negotiation, with respect to which the purchaser intends to aggregate the low-income occupancy required under this paragraph over the total number of units so purchased—
(i) not less than 40 percent of the aggregate number of all dwelling units purchased shall be made available for occupancy by and maintained as affordable for low-income and very low-income families during the remaining useful life of the building or structure in which the units are located; provided that
(ii) not less than 20 percent of the aggregate number of all dwelling units purchased shall be made available for occupancy by and maintained as affordable for very low-income families during the remaining useful life of the building or structure in which the units are located; and further provided that
(iii) not less than 10 percent of the dwelling units in each separate property purchased shall be made available for occupancy by and maintained as affordable for low-income families during the remaining useful life of the property in which the units are located.
The requirements of this paragraph shall be contained in the deed or other recorded instrument.
(8) Exemptions
(A) Continued occupancy of current residents
(B) Financial infeasibility
(e) Rent limitations
(1) In general
(2) Applicability
(f) Preferences for sales
(1) In general
(2) Multiproperty purchases
(3) Definition of substantially similar offers
(g) Financing sales
(1) Assistance by Corporation
(A) Sale price
(B) Purchase loan
(2) Assistance by HUD
(3) Assistance by FMHA
(4) Exception to disposition rules
(5) Bulk acquisitions under Home Investment Partnerships Act
(A) Purchase price
(B) Exemptions
(C) Inventories
(h) Coordination with other programs
(1) Use of secondary market agencies
(2) Credit enhancement
(A) In general
(B) Certain tax-exempt bonds
(3) National Affordable Housing Act
(i) Exemption for certain transactions with insured depository institutions
(j) Transfer of certain eligible residential properties to State housing agencies for dispositionNotwithstanding subsections (c), (d), (f), and (g), the Corporation may transfer eligible residential properties to the State housing finance agency or any other State housing agency for the State in which the property is located, or to any local housing agency in whose jurisdiction the property is located. Transfers of eligible residential properties under this subsection may be conducted by direct sale, consignment sale, or any other method the Corporation considers appropriate and shall be subject to the following requirements:
(1) Individual or bulk transfer
(2) Acquisition price
(3) Low-income useAny State housing finance agency or State or local housing agency acquiring properties under this subsection shall offer to sell or transfer the properties only as follows:
(A) Eligible single family propertiesFor eligible single family properties—
(i) to purchasers described under subparagraphs (A) and (B) of subsection (c)(2);
(ii) if the purchaser is a purchaser described under subsection (c)(2)(B)(i), subject to the rent limitations under subsection (e)(1);
(iii) subject to the requirement in the second sentence of subsection (c)(2); and
(iv) subject to recapture by the Corporation of excess proceeds from resale of the properties under paragraphs (3) and (4) of subsection (c).
(B) Eligible multifamily housing propertiesFor eligible multifamily housing properties—
(i) to qualifying multifamily purchasers;
(ii) subject to the low-income occupancy requirements under subsection (d)(7);
(iii) subject to the provisions of subsection (d)(8);
(iv) subject to a preference, among financially acceptable offers, to the offer that would reserve the highest percentage of dwelling units for occupancy or purchase by very low- and low-income families and would retain such affordability for the longest term; and
(v) subject to the rent limitations under subsection (e)(1).
(4) Affordability
(k) Exception for sales to nonprofit organizations and public agencies
(1) Suspension of offer periods
(2) Use restrictions
(A) Eligible single family property
(B) Eligible multifamily housing property
(l) Rules governing disposition of eligible condominium property
(1) Notice to clearinghouses
(2) Offers to sellFor the 180-day period following the date on which the Corporation makes an eligible condominium property available for sale, the Corporation may offer to sell the property, at the discretion of the Corporation, to 1 or more of the following purchasers:
(A) Qualifying households.
(B) Nonprofit organizations.
(C) Public agencies.
(D) For-profit entities.
(3) Low-income occupancy requirements
(A) In general
(B) Multiple-unit purchases
(C) Sale to other purchasers
(4) Recapture of profits from resale
(5) Exception to recapture requirement
(6) Limitations on multiple unit purchases
(7) Rent limitations
(m) Liability provisions
(1) In general
(2) Low-income occupancy
(3) Clearinghouses
(4) Corporation
(n) Unified affordable housing programs
(1) In general
(2) Authority and implementation
(3) Terms of agreementThe agreement required under paragraph (1) shall provide a plan for—
(A) a program unifying all activities and responsibilities of the Corporation and the Resolution Trust Corporation, and the design of the unified program shall take into consideration the substantial experience of the Resolution Trust Corporation regarding—
(i) seller financing;
(ii) technical assistance;
(iii) marketing skills and relationships with public and nonprofit entities; and
(iv) staff resources;
(B) the elimination of duplicative and unnecessary administrative costs and resources;
(C) the management structure of the unified program;
(D) a timetable for the unification; and
(E) a methodology to determine the extent to which the provisions of this section shall be effective, in accordance with the limitations under subsection (b)(2).
(4) Transfer to FDIC
(o) Report
(p) DefinitionsFor purposes of this section:
(1) Adjusted income and income
(2) ClearinghouseThe term “clearinghouse” means—
(A) the State housing finance agency for the State in which an eligible residential property or eligible condominium property is located;
(B) the Office of Community Investment (or other comparable division) within the Federal Housing Finance Board; and
(C) 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 [42 U.S.C. 3931 et seq.]) that the Corporation determines has the capacity to act as a clearinghouse for information.
(3) Corporation
(4) Eligible condominium propertyThe term “eligible condominium property” means a condominium unit, as such term is defined in section 3603 of title 15—
(A) to which such Corporation acquires title in its corporate capacity, its capacity as conservator, or its capacity as receiver (including in its capacity as the sole owner of a subsidiary corporation of a depository institution under conservatorship or receivership, which subsidiary has as its principal business the ownership of real property); and
(B) that has an appraised value that does not exceed the amount provided in section 203(b)(2)(A) of the National Housing Act [12 U.S.C. 1709(b)(2)(A)] except that such amount shall not exceed $101,250 in the case of a 1-family residence, $114,000 in the case of a 2-family residence, $138,000 in the case of a 3-family residence, and $160,000 in the case of a 4-family residence.
(5) Eligible multifamily housing propertyThe term “eligible multifamily housing property” means a property consisting of more than 4 dwelling units—
(A) to which the Corporation acquires title in its corporate capacity, its capacity as conservator, or its capacity as receiver (including in its capacity as the sole owner of a subsidiary corporation of a depository institution under conservatorship or receivership, which subsidiary has as its principal business the ownership of real property); and
(B) that has an appraised value that does not exceed the applicable dollar amount specified in section 221(d)(3)(ii) of the National Housing Act [12 U.S.C. 1715l(d)(3)(ii)] for elevator-type structures, as such dollar amount is increased under such section for geographical areas or on a project-by-project basis (except that any such increase on a project-by-project basis shall be made pursuant to a determination by the Corporation that such increase is necessary).
(6) Eligible residential property
(7) Eligible single family propertyThe term “eligible single family property” means a 1- to 4-family residence (including a manufactured home)—
(A) to which the Corporation acquires title in its corporate capacity, its capacity as conservator, or its capacity as receiver (including in its capacity as the sole owner of a subsidiary corporation of a depository institution under conservatorship or receivership, which subsidiary has as its principal business the ownership of real property); and
(B) that has an appraised value that does not exceed the amount provided in section 203(b)(2)(A) of the National Housing Act [12 U.S.C. 1709(b)(2)(A)] except that such amount shall not exceed $101,250 in the case of a 1-family residence, $114,000 in the case of a 2-family residence, $138,000 in the case of a 3-family residence, and $160,000 in the case of a 4-family residence.
(8) Low-income families
(9) Net realizable market value
(10) Nonprofit organizationThe term “nonprofit organization” means a private organization (including a limited equity cooperative)—
(A) no part of the earnings of which inures to the benefit of any member, shareholder, founder, contributor, or individual; and
(B) that is approved by the Corporation as to financial responsibility.
(11) Public agency
(12) Qualifying householdThe term “qualifying household” means a household—
(A) who intends to occupy eligible single family property as a principal residence;
(B) who agrees to occupy the property as a principal residence for at least 12 months;
(C) who certifies in writing that the household intends to occupy the property as a principal residence for at least 12 months; and
(D) whose income does not exceed 115 percent of the median income for the area, as determined by the Secretary, with adjustment for family size.
(13) Qualifying multifamily purchaserThe term “qualifying multifamily purchaser” means—
(A) a public agency;
(B) a nonprofit organization; or
(C) a for-profit entity, which makes a commitment (for itself or any related entity) to comply with the low-income occupancy requirements under subsection (d)(7) for any eligible multifamily housing property for which an offer to purchase is made during or after the periods specified under subsection (d).
(14) Secretary
(15) State housing finance agency
(16) Very low-income families
(q) Notice to clearinghouses regarding ineligible properties
(1) In general
(2) Content
(3) Availability
(4) DefinitionsFor purposes of this subsection, the following definitions shall apply:
(A) Ineligible condominium property
(B) Ineligible multifamily housing property
(C) Ineligible single family property
(D) Ineligible residential property
(Sept. 21, 1950, ch. 967, § 2[40], as added Pub. L. 102–242, title II, § 241(a), Dec. 19, 1991, 105 Stat. 2317; amended Pub. L. 102–389, title II, Oct. 6, 1992, 106 Stat. 1592, 1593; Pub. L. 102–550, title V, § 503(c)(4), Oct. 28, 1992, 106 Stat. 3780; Pub. L. 103–204, §§ 13, 14(a)(2), (d)(2), (e)(2), (f)(2), Dec. 17, 1993, 107 Stat. 2391, 2393, 2396, 2398; Pub. L. 103–325, title VI, § 602(a)(65), (66), Sept. 23, 1994, 108 Stat. 2291; Pub. L. 106–400, § 2, Oct. 30, 2000, 114 Stat. 1675.)

CITE AS: 12 USC 1831q

§ 1831r. Payments on foreign deposits prohibited
(a) In general
(b) Exception
(c) Discount window lending
(Sept. 21, 1950, ch. 967, § 2[41], as added Pub. L. 102–242, title III, § 312, Dec. 19, 1991, 105 Stat. 2367.)

CITE AS: 12 USC 1831r

§ 1831r–1. Notice of branch closure
(a) Notice to appropriate Federal banking agency
(1) In general
(2) Contents of noticeA notice under paragraph (1) shall include—
(A) a detailed statement of the reasons for the decision to close the branch; and
(B) statistical or other information in support of such reasons.
(b) Notice to customers
(1) In general
(2) Contents of noticeNotice under paragraph (1) shall consist of—
(A) posting of a notice in a conspicuous manner on the premises of the branch proposed to be closed during not less than the 30-day period ending on the date proposed for that closing; and
(B) inclusion of a notice in—
(i) at least one of any regular account statements mailed to customers of the branch proposed to be closed, or
(ii) in a separate mailing,
by not later than the beginning of the 90-day period ending on the date proposed for that closing.
(c) Adoption of policies
(d) Branch closures in interstate banking or branching operations
(1) Notice requirements
(2) Action required by appropriate Federal banking agencyIf, in the case of a branch referred to in paragraph (1)—
(A) a person from the area in which such branch is located—
(i) submits a written request relating to the closing of such branch to the appropriate Federal banking agency; and
(ii) includes a statement of specific reasons for the request, including a discussion of the adverse effect of such closing on the availability of banking services in the area affected by the closing of the branch; and
(B) the agency concludes that the request is not frivolous,
the agency shall consult with community leaders in the affected area and convene a meeting of representatives of the agency and other interested depository institution regulatory agencies with community leaders in the affected area and such other individuals, organizations, and depository institutions (as defined in section 461(b)(1)(A) of this title) as the agency may determine, in the discretion of the agency, to be appropriate, to explore the feasibility of obtaining adequate alternative facilities and services for the affected area, including the establishment of a new branch by another depository institution, the chartering of a new depository institution, or the establishment of a community development credit union, following the closing of the branch.
(3) No effect on closing
(4) DefinitionsFor purposes of this subsection, the following definitions shall apply:
(A) Interstate bank defined
(B) Low- or moderate-income areaThe term “low- or moderate-income area” means a census tract for which the median family income is—
(i) less than 80 percent of the median family income for the metropolitan statistical area (as designated by the Director of the Office of Management and Budget) in which the census tract is located; or
(ii) in the case of a census tract which is not located in a metropolitan statistical area, less than 80 percent of the median family income for the State in which the census tract is located, as determined without taking into account family income in metropolitan statistical areas in such State.
(e) Scope of applicationThis section shall not apply with respect to—
(1) an automated teller machine;
(2) the relocation of a branch or consolidation of one or more branches into another branch, if the relocation or consolidation—
(A) occurs within the immediate neighborhood; and
(B) does not substantially affect the nature of the business or customers served; or
(3) a branch that is closed in connection with—
(A) an emergency acquisition under—
(i)section 1821(n) of this title; or
(ii) subsection (f) or (k) of section 1823 of this title; or
(B) any assistance provided by the Corporation under section 1823(c) of this title.
(Sept. 21, 1950, ch. 967, § 2[42], formerly § 2[39], as added Pub. L. 102–242, title II, § 228, Dec. 19, 1991, 105 Stat. 2308; renumbered § 2[42], Pub. L. 102–550, title XVI, § 1602(a), Oct. 28, 1992, 106 Stat. 4078; amended Pub. L. 103–328, title I, § 106, Sept. 29, 1994, 108 Stat. 2357; Pub. L. 104–208, div. A, title II, § 2213, Sept. 30, 1996, 110 Stat. 3009–411.)

CITE AS: 12 USC 1831r-1

§ 1831s. Transferred

CITE AS: 12 USC 1831s

§ 1831t. Depository institutions lacking Federal deposit insurance
(a) Annual independent audit of private deposit insurers
(1) Audit required
(2) Providing copies of audit report
(A) Private deposit insurerThe private deposit insurer shall provide a copy of the audit report—
(i) to each depository institution the deposits of which are insured by the private deposit insurer, not later than 14 days after the audit is completed;
(ii) to the appropriate supervisory agency of each State in which such an institution receives deposits, not later than 7 days after the audit is completed; and
(iii) in the case of depository institutions described in subsection (e)(2)(A) the deposits of which are insured by the private insurer which are members of a Federal home loan bank, to the Federal Housing Finance Agency, not later than 7 days after the audit is completed.
(B) Depository institution
(3) Enforcement by appropriate State supervisor
(b) Disclosure requiredAny depository institution lacking Federal deposit insurance shall, within the United States, do the following:
(1) Periodic statements; account records
(2) Advertising; premises
(A) In general
(B) ExceptionsThe following need not include a notice that the institution is not federally insured:
(i) Any sign, document, or other item that contains the name of the depository institution, its logo, or its contact information, but only if the sign, document, or item does not include any information about the institution’s products or services or information otherwise promoting the institution.
(ii) Small utilitarian items that do not mention deposit products or insurance if inclusion of the notice would be impractical.
(3) Acknowledgment of disclosure
(A) New depositors obtained other than through a conversion or mergerWith respect to any depositor who was not a depositor at the depository institution before October 13, 2006, and who is not a depositor as described in subparagraph (B), receive any deposit for the account of such depositor only if the depositor has signed a written acknowledgement that—
(i) the institution is not federally insured; and
(ii) if the institution fails, the Federal Government does not guarantee that the depositor will get back the depositor’s money.
(B) New depositors obtained through a conversion or mergerWith respect to a depositor at a federally insured depository institution that converts to, or merges into, a depository institution lacking federal insurance after October 13, 2006, receive any deposit for the account of such depositor only if—
(i) the depositor has signed a written acknowledgement described in subparagraph (A); or
(ii) the institution makes an attempt, as described in subparagraph (D) and sent by mail no later than 45 days after the effective date of the conversion or merger, to obtain the acknowledgment.
(C) Current depositorsReceive any deposit after October 13, 2006, for the account of any depositor who was a depositor on that date only if—
(i) the depositor has signed a written acknowledgement described in subparagraph (A); or
(ii) the institution has complied with the provisions of subparagraph (E) which are applicable as of the date of the deposit.
(D) Alternative provision of notice to new depositors obtained through a conversion or merger
(i)2
2 So in original. No cl. (ii) has been enacted.
In generalTransmit to each depositor who has not signed a written acknowledgement described in subparagraph (A)—(I) a conspicuous card containing the information described in clauses (i) and (ii) of subparagraph (A), and a line for the signature of the depositor; and(II) accompanying materials requesting the depositor to sign the card, and return the signed card to the institution.
(E) Alternative provision of notice to current depositors
(i) In generalTransmit to each depositor who was a depositor before October 13, 2006, and has not signed a written acknowledgement described in subparagraph (A)—(I) a conspicuous card containing the information described in clauses (i) and (ii) of subparagraph (A), and a line for the signature of the depositor; and(II) accompanying materials requesting the depositor to sign the card, and return the signed card to the institution.
(ii) Manner and timing of notice(I) First notice(II) Second notice
(c) Manner and span of disclosure
(d) Exceptions for institutions not receiving retail deposits
(e) DefinitionsFor purposes of this section:
(1) Appropriate supervisor
(2) Depository institutionThe term “depository institution” includes—
(A) any entity described in section 461(b)(1)(A)(iv) of this title; and
(B) any entity that, as determined by the Bureau—
(i) is engaged in the business of receiving deposits; and
(ii) could reasonably be mistaken for a depository institution by the entity’s current or prospective customers.
(3) Lacking Federal deposit insuranceA depository institution lacks Federal deposit insurance if the institution is not either—
(A) an insured depository institution; or
(B) an insured credit union, as defined in section 101 of the Federal Credit Union Act [12 U.S.C. 1752].
(4) Private deposit insurer
(5) Bureau
(f) Enforcement
(1) Limited enforcement authority
(2) Broad State enforcement authority
(A) In general
(B) State powers
(C) Limitation on State action while Federal action pending
(Sept. 21, 1950, ch. 967, § 2[43], formerly § 2[40], as added Pub. L. 102–242, title I, § 151(a)(1), Dec. 19, 1991, 105 Stat. 2282; renumbered § 2[43], Pub. L. 102–550, title XVI § 1602(b), Oct. 28, 1992, 106 Stat. 4078; amended Pub. L. 103–325, title III, § 340(a), Sept. 23, 1994, 108 Stat. 2237; Pub. L. 109–173, § 2(c)(3), Feb. 15, 2006, 119 Stat. 3602; Pub. L. 109–351, title V, § 505, Oct. 13, 2006, 120 Stat. 1975; Pub. L. 111–203, title X, § 1090(2), July 21, 2010, 124 Stat. 2094; Pub. L. 114–94, div. G, title LXXXII, § 82001(b), Dec. 4, 2015, 129 Stat. 1796.)

CITE AS: 12 USC 1831t

§ 1831u. Interstate bank mergers
(a) Approval of interstate merger transactions authorized
(1) In general
(2) State election to prohibit interstate merger transactions
(A) In generalNotwithstanding paragraph (1), a merger transaction may not be approved pursuant to paragraph (1) if the transaction involves a bank the home State of which has enacted a law after September 29, 1994, and before June 1, 1997, that—
(i) applies equally to all out-of-State banks; and
(ii) expressly prohibits merger transactions involving out-of-State banks.
(B) No effect on prior approvals of merger transactions
(3) State election to permit early interstate merger transactions
(A) In generalA merger transaction may be approved pursuant to paragraph (1) before June 1, 1997, if the home State of each bank involved in the transaction has in effect, as of the date of the approval of such transaction, a law that—
(i) applies equally to all out-of-State banks; and
(ii) expressly permits interstate merger transactions with all out-of-State banks.
(B) Certain conditions allowedA host State may impose conditions on a branch within such State of a bank resulting from an interstate merger transaction if—
(i) the conditions do not have the effect of discriminating against out-of-State banks, out-of-State bank holding companies, or any subsidiary of such bank or company (other than on the basis of a nationwide reciprocal treatment requirement);
(ii) the imposition of the conditions is not preempted by Federal law; and
(iii) the conditions do not apply or require performance after May 31, 1997.
(4) Interstate merger transactions involving acquisitions of branches
(A) In general
(B) Treatment of branch for purposes of this section
(5) Preservation of State age laws
(A) In general
(B) Special rule for State age laws specifying a period of more than 5 years
(6) Shell banks
(b) Provisions relating to application and approval process
(1) Compliance with State filing requirements
(A) In generalAny bank which files an application for an interstate merger transaction shall—
(i) comply with the filing requirements of any host State of the bank which will result from such transaction to the extent that the requirement—(I) does not have the effect of discriminating against out-of-State banks or out-of-State bank holding companies or subsidiaries of such banks or bank holding companies; and(II) is similar in effect to any requirement imposed by the host State on a nonbanking corporation incorporated in another State that engages in business in the host State; and
(ii) submit a copy of the application to the State bank supervisor of the host State.
(B) Penalty for failure to comply
(2) Concentration limits
(A) Nationwide concentration limits
(B) Statewide concentration limits other than with respect to initial entriesThe responsible agency may not approve an application for an interstate merger transaction if—
(i) any bank involved in the transaction (including all insured depository institutions which are affiliates of any such bank) has a branch in any State in which any other bank involved in the transaction has a branch; and
(ii) the resulting bank (including all insured depository institutions which would be affiliates of the resulting bank), upon consummation of the transaction, would control 30 percent or more of the total amount of deposits of insured depository institutions in any such State.
(C) Effectiveness of State deposit caps
(D) Exceptions to subparagraph (B)The responsible agency may approve an application for an interstate merger transaction pursuant to subsection (a) without regard to the applicability of subparagraph (B) with respect to any State if—
(i) there is a limitation described in subparagraph (C) in a State statute, regulation, or order which has the effect of permitting a bank or bank holding company (including all insured depository institutions which are affiliates of the bank or bank holding company) to control a greater percentage of total deposits of all insured depository institutions in the State than the percentage permitted under subparagraph (B); or
(ii) the transaction is approved by the appropriate State bank supervisor of such State and the standard on which such approval is based does not have the effect of discriminating against out-of-State banks, out-of-State bank holding companies, or subsidiaries of such banks or holding companies.
(E) Exception for certain banks
(3) Community reinvestment complianceIn determining whether to approve an application for an interstate merger transaction in which the resulting bank would have a branch or bank affiliate immediately following the transaction in any State in which the bank submitting the application (as the acquiring bank) had no branch or bank affiliate immediately before the transaction, the responsible agency shall—
(A) comply with the responsibilities of the agency regarding such application under section 2903 of this title;
(B) take into account the most recent written evaluation under section 2903 of this title of any bank which would be an affiliate of the resulting bank; and
(C) take into account the record of compliance of any applicant bank with applicable State community reinvestment laws.
(4) Adequacy of capital and management skillsThe responsible agency may approve an application for an interstate merger transaction pursuant to subsection (a) only if—
(A) each bank involved in the transaction is adequately capitalized as of the date the application is filed; and
(B) the responsible agency determines that the resulting bank will be well capitalized and well managed upon the consummation of the transaction.
(5) Surrender of charter after merger transaction
(c) Applicability of certain laws to interstate banking operations
(1) State taxation authority not affected
(A) In general
(B) Imposition of shares tax by host States
(2) Applicability of antitrust lawsNo provision of this section shall be construed as affecting—
(A) the applicability of the antitrust laws; or
(B) the applicability, if any, of any State law which is similar to the antitrust laws.
(3) Reservation of certain rights to StatesNo provision of this section shall be construed as limiting in any way the right of a State to—
(A) determine the authority of State banks chartered by that State to establish and maintain branches; or
(B) supervise, regulate, and examine State banks chartered by that State.
(4) State-imposed notice requirementsA host State may impose any notification or reporting requirement on a branch of an out-of-State bank if the requirement—
(A) does not discriminate against out-of-State banks or bank holding companies; and
(B) is not preempted by any Federal law regarding the same subject.
(d) Operations of the resulting bank
(1) Continued operations
(2) Additional branches
(3) Certain conditions and commitments continuedIf, as a condition for the acquisition of a bank by an out-of-State bank holding company before September 29, 1994—
(A) the home State of the acquired bank imposed conditions on such acquisition by such out-of-State bank holding company; or
(B) the bank holding company made commitments to such State in connection with the acquisition,
the State may enforce such conditions and commitments with respect to such bank holding company or any affiliated successor company which controls a bank or branch in such State as a result of an interstate merger transaction to the same extent as the State could enforce such conditions or commitments against the bank holding company before the consummation of the merger transaction.
(e) Exception for banks in default or in danger of default
(f) Applicable rate and other charge limitations
(1) In generalIn the case of any State that has a constitutional provision that sets a maximum lawful annual percentage rate of interest on any contract at not more than 5 percent above the discount rate for 90-day commercial paper in effect at the Federal reserve bank for the Federal reserve district in which such State is located, except as provided in paragraph (2), upon the establishment in such State of a branch of any out-of-State insured depository institution in such State under this section, the maximum interest rate or amount of interest, discount points, finance charges, or other similar charges that may be charged, taken, received, or reserved (or in the case of a governmental entity located in such State, paid) from time to time in any loan or discount made or upon any note, bill of exchange, financing transaction, or other evidence of debt by—
(A) any insured depository institution whose home State is such State shall be equal to not more than the greater of—
(i) the maximum interest rate or amount of interest, discount points, finance charges, or other similar charges that may be charged, taken, received, or reserved in a similar transaction under the constitution or any statute or other law of the home State of the out-of-State insured depository institution establishing any such branch, without reference to this section, as such maximum interest rate or amount of interest may change from time to time; or
(ii) the maximum rate or amount of interest, discount points, finance charges, or other similar charges that may be charged, taken, received, or reserved in a similar transaction by a State insured depository institution chartered under the laws of such State or a national bank or Federal savings association whose main office is located in such State without reference to this section; and
(B) any governmental entity located in such State or any person that is not a depository institution described in subparagraph (A) doing business in such State, shall be equal to not more than the greater of the State’s maximum lawful annual percentage rate or 17 percent—
(i) to facilitate the uniform implementation of federally mandated or federally established programs and financings related thereto, including—(I) uniform accessibility of student loans, including the issuance of qualified student loan bonds as set forth in section 144(b) of title 26;(II) the uniform accessibility of mortgage loans, including the issuance of qualified mortgage bonds and qualified veterans’ mortgage bonds as set forth in section 143 of such title;(III) the uniform accessibility of safe and affordable housing programs administered or subject to review by the Department of Housing and Urban Development, including—(aa) the issuance of exempt facility bonds for qualified residential rental property as set forth in section 142(d) of such title; and(bb) the issuance of low income housing tax credits as set forth in section 42 of such title; and(IV) the uniform accessibility of bonds and obligations issued under the American Recovery and Reinvestment Act of 2009;
(ii) to facilitate interstate commerce through the issuance of bonds and obligations under any provision of State law, including bonds and obligations for the purpose of economic development, education, and improvements to infrastructure; and
(iii) to facilitate interstate commerce generally, including consumer loans, in the case of any person or governmental entity (other than a depository institution subject to subparagraph (A) and paragraph (2)).
(2) Rule of construction
(A) In generalNo provision of this subsection shall be construed as superseding or affecting—
(i) the authority of any insured depository institution to take, receive, reserve, and charge interest on any loan made in any State other than the State referred to in paragraph (1); or
(ii) the applicability of section 1735f–7a of this title, section 85 of this title, or section 1831d of this title.
(B) Applicability
(g) DefinitionsFor purposes of this section, the following definitions shall apply:
(1) Adequately capitalized
(2) Antitrust lawsThe term “antitrust laws”—
(A) has the same meaning as in subsection (a) of section 12 of title 15; and
(B) includes section 45 of title 15 to the extent such section 45 relates to unfair methods of competition.
(3) Branch
(4) Home StateThe term “home State”—
(A) means—
(i) with respect to a national bank, the State in which the main office of the bank is located; and
(ii) with respect to a State bank, the State by which the bank is chartered; and
(B) with respect to a bank holding company, has the same meaning as in section 1841(o)(4) of this title.
(5) Host State
(6) Interstate merger transaction
(7) Merger transaction
(8) Out-of-State bank
(9) Out-of-State bank holding company
(10) Responsible agency
(11) Resulting bank
(Sept. 21, 1950, ch. 967, § 2[44], as added Pub. L. 103–328, title I, § 102(a), Sept. 29, 1994, 108 Stat. 2343; amended Pub. L. 106–102, title VII, § 731, Nov. 12, 1999, 113 Stat. 1477; Pub. L. 111–32, title V, § 504(a), June 24, 2009, 123 Stat. 1880; Pub. L. 111–83, title V, § 563(a), (b), Oct. 28, 2009, 123 Stat. 2183; Pub. L. 111–203, title VI, § 607(b), July 21, 2010, 124 Stat. 1608.)

CITE AS: 12 USC 1831u

§ 1831v. Authority of State insurance regulator and Securities and Exchange Commission
(a) In general
Notwithstanding any other provision of law, the provisions of—
(1)section 1844(c) of this title that limit the authority of the Board of Governors of the Federal Reserve System to require reports from, to make examinations of, or to impose capital requirements on holding companies and their functionally regulated subsidiaries or that require deference to other regulators;
(2)section 1844(g) of this title that limit the authority of the Board to require a functionally regulated subsidiary of a holding company to provide capital or other funds or assets to a depository institution subsidiary of the holding company and to take certain actions including requiring divestiture of the depository institution; and
(3) section 1848a 1
1 See References in Text note below.
of this title that limit whatever authority the Board might otherwise have to take direct or indirect action with respect to holding companies and their functionally regulated subsidiaries;
shall also limit whatever authority that a Federal banking agency might otherwise have under any statute or regulation to require reports, make examinations, impose capital requirements, or take any other direct or indirect action with respect to any functionally regulated affiliate of a depository institution, subject to the same standards and requirements as are applicable to the Board under those provisions.
(b) Certain exemption authorized
(c) Definitions
For purposes of this section, the following definitions shall apply:
(1) Functionally regulated subsidiary
(2) Functionally regulated affiliate
The term “functionally regulated affiliate” means, with respect to any depository institution, any affiliate of such depository institution that is—
(A) not a depository institution holding company; and
(B) a company described in any clause of section 1844(c)(5)(B) of this title.
(Sept. 21, 1950, ch. 967, § 2[45], as added Pub. L. 106–102, title I, § 112(b), Nov. 12, 1999, 113 Stat. 1367.)

CITE AS: 12 USC 1831v

§ 1831w. Safety and soundness firewalls applicable to financial subsidiaries of banks
(a) In general
An insured State bank may control or hold an interest in a subsidiary that engages in activities as principal that would only be permissible for a national bank to conduct through a financial subsidiary if—
(1) the State bank and each insured depository institution affiliate of the State bank are well capitalized (after the capital deduction required by paragraph (2));
(2) the State bank complies with the capital deduction and financial statement disclosure requirements in section 24a(c) of this title;
(3) the State bank complies with the financial and operational safeguards required by section 24a(d) of this title; and
(4) the State bank complies with the amendments to sections 23A and 23B of the Federal Reserve Act [12 U.S.C. 371c and 371c–1] made by section 121(b) of the Gramm-Leach-Bliley Act.
(b) Preservation of existing subsidiaries
(c) Definitions
For purposes of this section, the following definitions shall apply:
(1) Subsidiary
(2) Financial subsidiary
(d) Preservation of authority
(1) This chapter
(2) Federal Reserve Act
(Sept. 21, 1950, ch. 967, § 2[46], as added Pub. L. 106–102, title I, § 121(d)(1), Nov. 12, 1999, 113 Stat. 1380.)

CITE AS: 12 USC 1831w

§ 1831x. Insurance customer protections
(a) Regulations required
(1) In generalThe Federal banking agencies shall prescribe and publish in final form, before the end of the 1-year period beginning on November 12, 1999, customer protection regulations (which the agencies jointly determine to be appropriate) that—
(A) apply to retail sales practices, solicitations, advertising, or offers of any insurance product by any depository institution or any person that is engaged in such activities at an office of the institution or on behalf of the institution; and
(B) are consistent with the requirements of this chapter and provide such additional protections for customers to whom such sales, solicitations, advertising, or offers are directed.
(2) Applicability to subsidiaries
(3) Consultation and joint regulations
(b) Sales practicesThe regulations prescribed pursuant to subsection (a) shall include antitying and anticoercion rules applicable to the sale of insurance products that prohibit a depository institution from engaging in any practice that would lead a customer to believe an extension of credit, in violation of section 1972 of this title, is conditional upon—
(1) the purchase of an insurance product from the institution or any of its affiliates; or
(2) an agreement by the consumer not to obtain, or a prohibition on the consumer from obtaining, an insurance product from an unaffiliated entity.
(c) Disclosures and advertisingThe regulations prescribed pursuant to subsection (a) shall include the following provisions relating to disclosures and advertising in connection with the initial purchase of an insurance product:
(1) Disclosures
(A) In generalRequirements that the following disclosures be made orally and in writing before the completion of the initial sale and, in the case of clause (iii), at the time of application for an extension of credit:
(i) Uninsured status
(ii) Investment risk
(iii) CoercionThe approval of an extension of credit may not be conditioned on—(I) the purchase of an insurance product from the institution in which the application for credit is pending or of any affiliate of the institution; or(II) an agreement by the consumer not to obtain, or a prohibition on the consumer from obtaining, an insurance product from an unaffiliated entity.
(B) Making disclosure readily understandableRegulations prescribed under subparagraph (A) shall encourage the use of disclosure that is conspicuous, simple, direct, and readily understandable, such as the following:
(i) “NOT FDIC—INSURED”.
(ii) “NOT GUARANTEED BY THE BANK”.
(iii) “MAY GO DOWN IN VALUE”.
(iv) “NOT INSURED BY ANY GOVERNMENT AGENCY”.
(C) Limitation
(D) Meaningful disclosures
(E) Adjustments for alternative methods of purchase
(F) Consumer acknowledgment
(2) Prohibition on misrepresentationsA prohibition on any practice, or any advertising, at any office of, or on behalf of, the depository institution, or any subsidiary, as appropriate, that could mislead any person or otherwise cause a reasonable person to reach an erroneous belief with respect to—
(A) the uninsured nature of any insurance product sold, or offered for sale, by the institution or any subsidiary of the institution;
(B) in the case of a variable annuity or insurance product that involves an investment risk, the investment risk associated with any such product; or
(C) in the case of an institution or subsidiary at which insurance products are sold or offered for sale, the fact that—
(i) the approval of an extension of credit to a customer by the institution or subsidiary may not be conditioned on the purchase of an insurance product by such customer from the institution or subsidiary; and
(ii) the customer is free to purchase the insurance product from another source.
(d) Separation of banking and nonbanking activities
(1) Regulations required
(2) RequirementsRegulations prescribed pursuant to paragraph (1) shall include the following requirements:
(A) Separate setting
(B) Referrals
(C) Qualification and licensing requirements
(e) Domestic violence discrimination prohibition
(1) In general
(2) Scope of application
(3) Domestic violence definedFor purposes of this subsection, the term “domestic violence” means the occurrence of one or more of the following acts by a current or former family member, household member, intimate partner, or caretaker:
(A) Attempting to cause or causing or threatening another person physical harm, severe emotional distress, psychological trauma, rape, or sexual assault.
(B) Engaging in a course of conduct or repeatedly committing acts toward another person, including following the person without proper authority, under circumstances that place the person in reasonable fear of bodily injury or physical harm.
(C) Subjecting another person to false imprisonment.
(D) Attempting to cause or cause damage to property so as to intimidate or attempt to control the behavior of another person.
(f) Consumer grievance processThe Federal banking agencies shall jointly establish a consumer complaint mechanism, for receiving and expeditiously addressing consumer complaints alleging a violation of regulations issued under the section, which shall—
(1) establish a group within each regulatory agency to receive such complaints;
(2) develop procedures for investigating such complaints;
(3) develop procedures for informing consumers of rights they may have in connection with such complaints; and
(4) develop procedures for addressing concerns raised by such complaints, as appropriate, including procedures for the recovery of losses to the extent appropriate.
(g) Effect on other authority
(1) In generalNo provision of this section shall be construed as granting, limiting, or otherwise affecting—
(A) any authority of the Securities and Exchange Commission, any self-regulatory organization, the Municipal Securities Rulemaking Board, or the Secretary of the Treasury under any Federal securities law; or
(B) except as provided in paragraph (2), any authority of any State insurance commission (or any agency or office performing like functions), or of any State securities commission (or any agency or office performing like functions), or other State authority under any State law.
(2) Coordination with State law
(A) In general
(B) Preemption
(i) In general
(ii) Considerations
(iii) Federal preemption and ability of States to override Federal preemption
(h) Non-discrimination against non-affiliated agents
(Sept. 21, 1950, ch. 967, § 2[47], as added Pub. L. 106–102, title III, § 305, Nov. 12, 1999, 113 Stat. 1410.)

CITE AS: 12 USC 1831x

§ 1831y. CRA sunshine requirements
(a) Public disclosure of agreementsAny agreement (as defined in subsection (e)) entered into after November 12, 1999, by an insured depository institution or affiliate with a nongovernmental entity or person made pursuant to or in connection with the Community Reinvestment Act of 1977 [12 U.S.C. 2901 et seq.] involving funds or other resources of such insured depository institution or affiliate—
(1) shall be in its entirety fully disclosed, and the full text thereof made available to the appropriate Federal banking agency with supervisory responsibility over the insured depository institution and to the public by each party to the agreement; and
(2) shall obligate each party to comply with this section.
(b) Annual report of activity by insured depository institutionEach insured depository institution or affiliate that is a party to an agreement described in subsection (a) shall report to the appropriate Federal banking agency with supervisory responsibility over the insured depository institution, not less frequently than once each year, such information as the Federal banking agency may by rule require relating to the following actions taken by the party pursuant to the agreement during the preceding 12-month period:
(1) Payments, fees, or loans made to any party to the agreement or received from any party to the agreement and the terms and conditions of the same.
(2) Aggregate data on loans, investments, and services provided by each party in its community or communities pursuant to the agreement.
(3) Such other pertinent matters as determined by regulation by the appropriate Federal banking agency with supervisory responsibility over the insured depository institution.
(c) Annual report of activity by nongovernmental entities
(1) In general
(2) Submission to insured depository institution
(3) Information to be included
(d) Applicability
(e) Definitions
(1) AgreementFor purposes of this section, the term “agreement”—
(A) means—
(i) any written contract, written arrangement, or other written understanding that provides for cash payments, grants, or other consideration with a value in excess of $10,000, or for loans the aggregate amount of principal of which exceeds $50,000, annually (or the sum of all such agreements during a 12-month period with an aggregate value of cash payments, grants, or other consideration in excess of $10,000, or with an aggregate amount of loan principal in excess of $50,000); or
(ii) a group of substantively related contracts with an aggregate value of cash payments, grants, or other consideration in excess of $10,000, or with an aggregate amount of loan principal in excess of $50,000, annually;
made pursuant to, or in connection with, the fulfillment of the Community Reinvestment Act of 1977 [12 U.S.C. 2901 et seq.], at least 1 party to which is an insured depository institution or affiliate thereof, whether organized on a profit or not-for-profit basis; and
(B) does not include—
(i) any individual mortgage loan;
(ii) any specific contract or commitment for a loan or extension of credit to individuals, businesses, farms, or other entities, if the funds are loaned at rates not substantially below market rates and if the purpose of the loan or extension of credit does not include any re-lending of the borrowed funds to other parties; or
(iii) any agreement entered into by an insured depository institution or affiliate with a nongovernmental entity or person who has not commented on, testified about, or discussed with the institution, or otherwise contacted the institution, concerning the Community Reinvestment Act of 1977 [12 U.S.C. 2901 et seq.].
(2) Fulfillment of CRAFor purposes of subparagraph (A), the term “fulfillment” means a list of factors that the appropriate Federal banking agency determines have a material impact on the agency’s decision—
(A) to approve or disapprove an application for a deposit facility (as defined in section 803 of the Community Reinvestment Act of 1977 [12 U.S.C. 2902]); or
(B) to assign a rating to an insured depository institution under section 807 of the Community Reinvestment Act of 1977 [12 U.S.C. 2906].
(f) Violations
(1) Violations by persons other than insured depository institutions or their affiliates
(A) Material failure to comply
(B) Diversion of funds or resourcesIf funds or resources received under an agreement described in subsection (a) have been diverted contrary to the purposes of the agreement for personal financial gain, the appropriate Federal banking agency with supervisory responsibility over the insured depository institution may impose either or both of the following penalties:
(i) Disgorgement by the offending individual of funds received under the agreement.
(ii) Prohibition of the offending individual from being a party to any agreement described in subsection (a) for a period of not to exceed 10 years.
(2) Designation of successor nongovernmental party
(3) Inadvertent or de minimis reporting errors
(g) Rule of construction
(h) Regulations
(1) In general
(2) Protection of partiesIn carrying out paragraph (1), each appropriate Federal banking agency shall—
(A) ensure that the regulations prescribed by the agency do not impose an undue burden on the parties and that proprietary and confidential information is protected; and
(B) establish procedures to allow any nongovernmental entity or person who is a party to a large number of agreements described in subsection (a) to make a single or consolidated filing of a report under subsection (c) to an insured depository institution or an appropriate Federal banking agency.
(3) Parties not subject to reporting requirementsThe Board of Governors of the Federal Reserve System may prescribe regulations—
(A) to prevent evasions of subsection (e)(1)(B)(iii); and
(B) to provide further exemptions under such subsection, consistent with the purposes of this section.
(4) Coordination, consistency, and comparability
(Sept. 21, 1950, ch. 967, § 2[48], as added Pub. L. 106–102, title VII, § 711, Nov. 12, 1999, 113 Stat. 1465.)

CITE AS: 12 USC 1831y

§ 1831z. Bi-annual FDIC survey and report on encouraging use of depository institutions by the unbanked
(a) Survey required
(1) In general
(2) Factors and questions to consider
In conducting the survey, the Corporation shall take the following factors and questions into account:
(A) To what extent do insured depository institutions promote financial education and financial literacy outreach?
(B) Which financial education efforts appear to be the most effective in bringing “unbanked” individuals and families into the conventional finance system?
(C) What efforts are insured institutions making at converting “unbanked” money order, wire transfer, and international remittance customers into conventional account holders?
(D) What cultural, language and identification issues as well as transaction costs appear to most prevent “unbanked” individuals from establishing conventional accounts?
(E) What is a fair estimate of the size and worth of the “unbanked” market in the United States?
(b) Reports
(Sept. 21, 1950, ch. 967, § 2[49], as added Pub. L. 109–173, § 7, Feb. 15, 2006, 119 Stat. 3609.)

CITE AS: 12 USC 1831z

§ 1831aa. Enforcement of agreements
(a) In general
Notwithstanding clause (i) or (ii) of section 1818(b)(6)(A) of this title or section 1831o(e)(2)(E)(i) of this title, the appropriate Federal banking agency for a depository institution may enforce, under section 1818 of this title, the terms of—
(1) any condition imposed in writing by the agency on the depository institution or an institution-affiliated party in connection with any action on any application, notice, or other request concerning the depository institution; or
(2) any written agreement entered into between the agency and the depository institution or an institution-affiliated party.
(b) Receiverships and conservatorships
(Sept. 21, 1950, ch. 967, § 2[50], as added Pub. L. 109–351, title VII, § 702(a), Oct. 13, 2006, 120 Stat. 1985.)

CITE AS: 12 USC 1831aa

§ 1831bb. Capital requirements for certain acquisition, development, or construction loans
(a) In general
(b) HVCRE ADC loan definedFor purposes of this section and with respect to a depository institution, the term “HVCRE ADC loan”—
(1) means a credit facility secured by land or improved real property that, prior to being reclassified by the depository institution as a non-HVCRE ADC loan pursuant to subsection (d)—
(A) primarily finances, has financed, or refinances the acquisition, development, or construction of real property;
(B) has the purpose of providing financing to acquire, develop, or improve such real property into income-producing real property; and
(C) is dependent upon future income or sales proceeds from, or refinancing of, such real property for the repayment of such credit facility;
(2) does not include a credit facility financing—
(A) the acquisition, development, or construction of properties that are—
(i) one- to four-family residential properties;
(ii) real property that would qualify as an investment in community development; or
(iii) agricultural land;
(B) the acquisition or refinance of existing income-producing real property secured by a mortgage on such property, if the cash flow being generated by the real property is sufficient to support the debt service and expenses of the real property, in accordance with the institution’s applicable loan underwriting criteria for permanent financings;
(C) improvements to existing income-producing improved real property secured by a mortgage on such property, if the cash flow being generated by the real property is sufficient to support the debt service and expenses of the real property, in accordance with the institution’s applicable loan underwriting criteria for permanent financings; or
(D) commercial real property projects in which—
(i) the loan-to-value ratio is less than or equal to the applicable maximum supervisory loan-to-value ratio as determined by the appropriate Federal banking agency;
(ii) the borrower has contributed capital of at least 15 percent of the real property’s appraised, “as completed” value to the project in the form of—(I) cash;(II) unencumbered readily marketable assets;(III) paid development expenses out-of-pocket; or(IV) contributed real property or improvements; and
(iii) the borrower contributed the minimum amount of capital described under clause (ii) before the depository institution advances funds (other than the advance of a nominal sum made in order to secure the depository institution’s lien against the real property) under the credit facility, and such minimum amount of capital contributed by the borrower is contractually required to remain in the project until the credit facility has been reclassified by the depository institution as a non-HVCRE ADC loan under subsection (d);
(3) does not include any loan made prior to January 1, 2015; and
(4) does not include a credit facility reclassified as a non-HVCRE ADC loan under subsection (d).
(c) Value of contributed real property
(d) Reclassification as a Non-HVRCE ADC loanFor purposes of this section and with respect to a credit facility and a depository institution, upon—
(1) the substantial completion of the development or construction of the real property being financed by the credit facility; and
(2) cash flow being generated by the real property being sufficient to support the debt service and expenses of the real property,
in accordance with the institution’s applicable loan underwriting criteria for permanent financings, the credit facility may be reclassified by the depository institution as a Non-HVCRE ADC loan.
(e) Existing authorities
(Sept. 21, 1950, ch. 967, § 2[51], as added Pub. L. 115–174, title II, § 214, May 24, 2018, 132 Stat. 1321.)

CITE AS: 12 USC 1831bb

§ 1831cc. Data standards
(a) Definition
(b) Requirement
(c) Consistency
(Sept. 21, 1950, ch. 967, § 2[52], as added Pub. L. 117–263, div. E, title LVIII, § 5831, Dec. 23, 2022, 136 Stat. 3430.)

CITE AS: 12 USC 1831cc

§ 1831dd. Open data publication
All public data assets published by the Corporation under this chapter or under the Dodd-Frank Wall Street Reform and Consumer Protection Act (Public Law 111–203; 124 Stat. 1376) shall be—
(1) made available as an open Government data asset (as defined in section 3502 of title 44);
(2) freely available for download;
(3) rendered in a human-readable format; and
(4) accessible via application programming interface where appropriate.
(Sept. 21, 1950, ch. 967, § 2[53], as added Pub. L. 117–263, div. E, title LVIII, § 5832, Dec. 23, 2022, 136 Stat. 3431.)

CITE AS: 12 USC 1831dd

§ 1832. Withdrawals by negotiable or transferable instruments for transfers to third parties
(a) Authority of depository institution; applicability
(1) Notwithstanding any other provision of law but subject to paragraph (2), a depository institution is authorized to permit the owner of a deposit or account on which interest or dividends are paid to make withdrawals by negotiable or transferable instruments for the purpose of making transfers to third parties.
(2) Paragraph (1) shall apply only with respect to deposits or accounts which consist solely of funds in which the entire beneficial interest is held by one or more individuals or by an organization which is operated primarily for religious, philanthropic, charitable, educational, political, or other similar purposes and which is not operated for profit, and with respect to deposits of public funds by an officer, employee, or agent of the United States, any State, county, municipality, or political subdivision thereof, the District of Columbia, the Commonwealth of Puerto Rico, American Samoa, Guam, any territory or possession of the United States, or any political subdivision thereof.
(b) “Depository institution” defined
For purposes of this section, the term “depository institution” means—
(1) any insured bank as defined in section 1813 of this title;
(2) any State bank as defined in section 1813 of this title;
(3) any mutual savings bank as defined in section 1813 of this title;
(4) any savings bank as defined in section 1813 of this title;
(5) any insured institution as defined in section 1724 1
1 See References in Text note below.
of this title; and
(6) any building and loan association or savings and loan association organized and operated according to the laws of the State in which it is chartered or organized; and, for purposes of this paragraph, 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, or the Virgin Islands.
(c) Fine
(Pub. L. 93–100, § 2, Aug. 16, 1973, 87 Stat. 342; Pub. L. 94–222, § 2, Feb. 27, 1976, 90 Stat. 197; Pub. L. 95–630, title XIII, § 1301, Nov. 10, 1978, 92 Stat. 3712; Pub. L. 96–161, title I, § 106, Dec. 28, 1979, 93 Stat. 1235; Pub. L. 96–221, title III, § 303, Mar. 31, 1980, 94 Stat. 146; Pub. L. 97–320, title VII, § 706(a), Oct. 15, 1982, 96 Stat. 1540; Pub. L. 100–86, title I, § 109, Aug. 10, 1987, 101 Stat. 579.)

CITE AS: 12 USC 1832

§ 1833. Repealed. Pub. L. 104–208, div. A, title II, § 2224(b), Sept. 30, 1996, 110 Stat. 3009–415

CITE AS: 12 USC 1833

§ 1833a. Civil penalties
(a) In general
(b) Maximum amount of penalty
(1) Generally
(2) Special rule for continuing violations
(3) Special rule for violations creating gain or loss
(A) If any person derives pecuniary gain from the violation, or if the violation results in pecuniary loss to a person other than the violator, the amount of the civil penalty may exceed the amounts described in paragraphs (1) and (2) but may not exceed the amount of such gain or loss.
(B) As used in this paragraph, the term “person” includes the Bank Insurance Fund, the Savings Association Insurance Fund, and after the merger of such funds, the Deposit Insurance Fund, and the National Credit Union Share Insurance Fund.
(c) Violations to which penalty is applicable
This section applies to a violation of, or a conspiracy to violate—
(1) section 215, 656, 657, 1005, 1006, 1007, 1014, or 1344 of title 18;
(2) section 287, 1001, 1032,1
1 See 1990 Amendment note below.
1341 or 1343 of title 18 affecting a federally insured financial institution; or
(3)section 645(a) of title 15.
(d) Effective date
(e) Attorney General to bring action
(f) Burden of proof
(g) Administrative subpoenas
(1) In general
For the purpose of conducting a civil investigation in contemplation of a civil proceeding under this section, the Attorney General may—
(A) administer oaths and affirmations;
(B) take evidence; and
(C) by subpoena, summon witnesses and require the production of any books, papers, correspondence, memoranda, or other records which the Attorney General deems relevant or material to the inquiry. Such subpoena may require the attendance of witnesses and the production of any such records from any place in the United States at any place in the United States designated by the Attorney General.
(2) Procedures applicable
(3) Limitation
(h) Statute of limitations
(Pub. L. 101–73, title IX, § 951, Aug. 9, 1989, 103 Stat. 498; Pub. L. 101–647, title XXV, §§ 2533, 2596(d), Nov. 29, 1990, 104 Stat. 4882, 4908; Pub. L. 103–322, title XXXIII, § 330003(g), Sept. 13, 1994, 108 Stat. 2141; Pub. L. 104–208, div. A, title II, § 2704(d)(15)(A), Sept. 30, 1996, 110 Stat. 3009–494; Pub. L. 107–100, § 4(b), Dec. 21, 2001, 115 Stat. 966; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 9(g)(1), Feb. 15, 2006, 119 Stat. 3618.)

CITE AS: 12 USC 1833a

§ 1833b. Comparability in compensation schedules
(a) In general
(b) Commodity Futures Trading Commission
In establishing and adjusting schedules of compensation and benefits for employees of the Commodity Futures Trading Commission under applicable provisions of law, the Commission shall—
(1) inform the heads of the agencies referred to in subsection (a) and Congress of such compensation and benefits; and
(2) seek to maintain comparability with those agencies regarding compensation and benefits.
(Pub. L. 101–73, title XII, § 1206, Aug. 9, 1989, 103 Stat. 523; Pub. L. 102–233, title III, § 302(a), Dec. 12, 1991, 105 Stat. 1767; Pub. L. 107–123, § 8(d)(3), Jan. 16, 2002, 115 Stat. 2400; Pub. L. 107–171, title X, § 10702(b), May 13, 2002, 116 Stat. 516; Pub. L. 111–203, title I, § 152(d)(3), title III, § 367(8), July 21, 2010, 124 Stat. 1414, 1557.)

CITE AS: 12 USC 1833b

§ 1833c. Comptroller General audit and access to records
(a) Audit of agencies or other persons performing functions under banking laws
(1) In general
(2) Exceptions
Paragraph (1) shall not apply to—
(A) any function or activity of the Board of Governors of the Federal Reserve System or the Federal Reserve banks that is described in any paragraph of section 714(b) of title 31; and
(B) any function or activity of the Federal National Mortgage Association, except as provided in section 1723a(j) of this title.
(b) Audit of persons providing certain goods or services
(c) Provisions applicable to audits under this section
(1) Nature and scope of audit
(2) Coordination with other provisions of law
(3) Rights of access, examination, and copying
(4) Enforcement of right of access
(5) Maintenance of confidential records
(Pub. L. 101–73, title XII, § 1213, Aug. 9, 1989, 103 Stat. 528.)

CITE AS: 12 USC 1833c

§ 1833d. Repealed. Pub. L. 102–242, title I, § 121(b), Dec. 19, 1991, 105 Stat. 2251

CITE AS: 12 USC 1833d

§ 1833e. Equal opportunity
(a) In general
For purposes of this Act, Executive Order Numbered 11478, providing for equal employment opportunity in the Federal Government, shall apply to—
(1) the Comptroller of the Currency;
(2) the Federal Housing Finance Agency; and
(3) the Federal Deposit Insurance Corporation.
(b) Affirmative program for equal employment opportunity
(c) Solicitation of contracts
(d) Report to Congress
Before the end of the 180-day period beginning on August 9, 1989—
(1) the Federal Deposit Insurance Corporation;
(2) the Comptroller of the Currency;
(3) the Federal Housing Finance Board;
(4) the Federal Home Loan Mortgage Corporation; and
(5) the Federal National Mortgage Association,
shall each submit to the Congress a report containing a complete description of the actions taken by such agency pursuant to subsections (a) and (b) and such recommendations for administrative and legislative action as each such agency may determine to be appropriate to carry out the purposes of such subsection.
(Pub. L. 101–73, title XII, § 1216, Aug. 9, 1989, 103 Stat. 529; Pub. L. 102–233, title III, § 302(a), Dec. 12, 1991, 105 Stat. 1767; Pub. L. 110–289, div. A, title II, § 1216(g), July 30, 2008, 122 Stat. 2793; Pub. L. 111–203, title III, § 367(9), July 21, 2010, 124 Stat. 1557.)

CITE AS: 12 USC 1833e

§ 1834. Reduced assessment rate for deposits attributable to lifeline accounts
(a) Qualification of lifeline accounts
(1) In general
(2) Factors to be considered
In determining the minimum requirements under paragraph (1) for lifeline accounts at insured depository institutions, the Corporation shall consider the following factors:
(A) Whether the account is available to provide basic transaction services for individuals who maintain a balance of less than $1,000 or such other amount which the Comptroller may determine to be appropriate.
(B) Whether any service charges or fees to which the account is subject, if any, for routine transactions do not exceed a minimal amount.
(C) Whether any minimum balance or minimum opening requirement to which the account is subject, if any, is not more than a minimal amount.
(D) Whether checks, negotiable orders of withdrawal, or similar instruments for making payments or other transfers to third parties may be drawn on the account.
(E) Whether the depositor is permitted to make more than a minimal number of withdrawals from the account each month by any means described in subparagraph (D) or any other means.
(F) Whether a monthly statement itemizing all transactions for the monthly reporting period is made available to the depositor with respect to such account or a passbook is provided in which all transactions with respect to such account are recorded.
(G) Whether depositors are permitted access to tellers at the institution for conducting transactions with respect to such account.
(H) Whether other account relationships with the institution are required in order to open any such account.
(I) Whether individuals are required to meet any prerequisite which discriminates against low-income individuals in order to open such account.
(J) Such other factors as the Corporation may determine to be appropriate.
(3) Definitions
For purposes of this subsection—
(A) Comptroller
(B) Corporation
(C) Insured depository institution
(D) Lifeline account
(b) Omitted
(c) Availability of funds
(Pub. L. 102–242, title II, § 232, Dec. 19, 1991, 105 Stat. 2308; Pub. L. 102–550, title XVI, §§ 1604(b)(1), 1605(a)(3), Oct. 28, 1992, 106 Stat. 4083, 4085; Pub. L. 102–558, title III, §§ 303(b)(1), (4), 305, Oct. 28, 1992, 106 Stat. 4224–4226; Pub. L. 104–208, div. A, title II, § 2704(d)(16), Sept. 30, 1996, 110 Stat. 3009–495; Pub. L. 109–171, title II, § 2102(b), Feb. 8, 2006, 120 Stat. 9; Pub. L. 109–173, § 3(a)(9), Feb. 15, 2006, 119 Stat. 3606; Pub. L. 111–203, title III, § 353, July 21, 2010, 124 Stat. 1546.)

CITE AS: 12 USC 1834

§ 1834a. Assessment credits for qualifying activities relating to distressed communities
(a) Determination of credits for increases in community enterprise activities
(1) In generalThe Community Enterprise Assessment Credit Board established under subsection (d) shall issue guidelines for insured depository institutions eligible under this subsection for any community enterprise assessment credit with respect to any semiannual period. Such guidelines shall—
(A) designate the eligibility requirements for any institution meeting applicable capital standards to receive an assessment credit under section 1817(b)(7) of this title; and
(B) determine the community enterprise assessment credit available to any eligible institution under paragraph (3).
(2) Qualifying activitiesAn insured depository institution may apply for for 1
1 So in original.
any community enterprise assessment credit for any semiannual period for—
(A) the amount, during such period, of new originations of qualified loans and other assistance provided for low- and moderate-income persons in distressed communities, or enterprises integrally involved with such neighborhoods, which the Board determines are qualified to be taken into account for purposes of this subsection;
(B) the amount, during such period, of deposits accepted from persons domiciled in the distressed community, at any office of the institution (including any branch) located in any qualified distressed community, and new originations of any loans and other financial assistance made within that community, except that in no case shall the credit for deposits at any institution or branch exceed the credit for loans and other financial assistance by the bank or branch in the distressed community; and
(C) any increase during the period in the amount of new equity investments in community development financial institutions.
(3) Amount of assessment creditThe amount of any community enterprise assessment credit available under section 1817(b)(7) of this title for any insured depository institution, or a qualified portion thereof, shall be the amount which is equal to 5 percent, in the case of an institution which does not meet the community development organization requirements under section 1834b of this title, and 15 percent, in the case of an institution, or a qualified portion thereof, which meets such requirements (or any percentage designated under paragraph (5)) of—
(A) for the first full semiannual period in which community enterprise assessment credits are available, the sum of—
(i) the amounts of assets described in paragraph (2)(A); and
(ii) the amounts of deposits, loans, and other financial assistance described in paragraph (2)(B); and
(B) for any subsequent semiannual period, the sum of—
(i) any increase during such period in the amount of assets described in paragraph (2)(A) that has been deemed eligible for credit by the Board; and
(ii) any increase during such period in the amounts of deposits, loans, and other financial assistance described in paragraph (2)(B) that has been deemed eligible for credit by the Board.
(4) Determination of qualified loans and other financial assistanceExcept as provided in paragraph (6), the types of loans and other assistance which the Board may determine to be qualified to be taken into account under paragraph (2)(A) for purposes of the community enterprise assessment credit, may include the following:
(A) Loans insured or guaranteed by the Secretary of Housing and Urban Development, the Secretary of the Department of Veterans Affairs, the Administrator of the Small Business Administration, and the Secretary of Agriculture.
(B) Loans or financing provided in connection with activities assisted by the Administrator of the Small Business Administration or any small business investment company and investments in small business investment companies.
(C) Loans or financing provided in connection with any neighborhood housing service program assisted under the Neighborhood Reinvestment Corporation Act [42 U.S.C. 8101 et seq.].
(D) Loans or financing provided in connection with any activities assisted under the community development block grant program under title I of the Housing and Community Development Act of 1974 [42 U.S.C. 5301 et seq.].
(E) Loans or financing provided in connection with activities assisted under title II of the Cranston-Gonzalez National Affordable Housing Act [
(F) Loans or financing provided in connection with a homeownership program assisted under title III of the United States Housing Act of 1937 [42 U.S.C. 1437aaa et seq.] or subtitle B or C of title IV of the Cranston-Gonzalez National Affordable Housing Act [42 U.S.C. 12871 et seq., 12891 et seq.].
(G) Financial assistance provided through community development corporations.
(H) Federal and State programs providing interest rate assistance for homeowners.
(I) Extensions of credit to nonprofit developers or purchasers of low-income housing and small business developments.
(J) In the case of members of any Federal home loan bank, participation in the community investment fund program established by the Federal home loan banks.
(K) Conventional mortgages targeted to low- or moderate-income persons.
(L) Loans made for the purpose of developing or supporting—
(i) commercial facilities that enhance revitalization, community stability, or job creation and retention efforts;
(ii) business creation and expansion efforts that—(I) create or retain jobs for low-income people;(II) enhance the availability of products and services to low-income people; or(III) create or retain businesses owned by low-income people or residents of a targeted area;
(iii) community facilities that provide benefits to low-income people or enhance community stability;
(iv) home ownership opportunities that are affordable to low-income households;
(v) rental housing that is principally affordable to low-income households; and
(vi) other activities deemed appropriate by the Board.
(M) The provision of technical assistance to residents of qualified distressed communities in managing their personal finances through consumer education programs either sponsored or offered by insured depository institutions.
(N) The provision of technical assistance and consulting services to newly formed small businesses located in qualified distressed communities.
(O) The provision of technical assistance to, or servicing the loans of low- or moderate-income homeowners and homeowners located in qualified distressed communities.
(5) Adjustment of percentage
(6) Certain investments not eligible to be taken into account
(7) Quantitative analysis of technical assistance
(b) “Qualified distressed community” defined
(1) In generalFor purposes of this section, the term “qualified distressed community” means any neighborhood or community which—
(A) meets the minimum area requirements under paragraph (3) and the eligibility requirements of paragraph (4); and
(B) is designated as a distressed community by any insured depository institution in accordance with paragraph (2) and such designation is not disapproved under such paragraph.
(2) Designation requirements
(A) Notice of designation
(i) Notice to agency
(ii) Public notice
(B) Agency duties relating to designations
(i) Providing information
(ii) Period for disapproval
(3) Minimum area requirementsFor purposes of this subsection, an area meets the requirements of this paragraph if—
(A) the area is within the jurisdiction of 1 unit of general local government;
(B) the boundary of the area is contiguous; and
(C) the area—
(i) has a population, as determined by the most recent census data available, of not less than—(I) 4,000, if any portion of such area is located within a metropolitan statistical area (as designated by the Director of the Office of Management and Budget) with a population of 50,000 or more; or(II) 1,000, in any other case; or
(ii) is entirely within an Indian reservation (as determined by the Secretary of the Interior).
(4) Eligibility requirementsFor purposes of this subsection, an area meets the requirements of this paragraph if the following criteria are met:
(A) At least 30 percent of the residents residing in the area have incomes which are less than the national poverty level.
(B) The unemployment rate for the area is 1½ times greater than the national average (as determined by the Bureau of Labor Statistics’ most recent figures).
(C) Such additional eligibility requirements as the Board may, in its discretion, deem necessary to carry out the provisions of this subtitle.
(c) Omitted
(d) Community Enterprise Assessment Credit Board
(1) Establishment
(2) Number and appointmentThe Board shall be composed of 5 members as follows:
(A) The Secretary of the Treasury or a designee of the Secretary.
(B) The Secretary of Housing and Urban Development or a designee of the Secretary.
(C) The Chairperson of the Federal Deposit Insurance Corporation or a designee of the Chairperson.
(D) 2 individuals appointed by the President from among individuals who represent community organizations.
(3) Terms
(A) Appointed members
(B) Interim appointment
(C) Continuation of service
(4) Chairperson
(5) No pay
(6) Travel expenses
(7) Meetings
(e) Duties of Board
(1) Procedure for determining community enterprise assessment credits
(2) Notice to FDIC
(f) Availability of funds
(g) Prohibition on double funding for same activitiesNo community development financial institution may receive a community enterprise assessment credit if such institution, either directly or through a community partnership—
(1) has received assistance within the preceding 12-month period, or has an application for assistance pending, under section 4704 of this title; or
(2) has ever received assistance, under section 4707 of this title, for the same activity during the same semiannual period for which the institution seeks a community enterprise assessment credit under this section.
(h) Priority of awards
(1) Qualifying loans and services
(A) In general
(B) Priority for support of efforts of CDFI
(C) Other factorsThe Board may also consider the following factors:
(i) Degree of difficulty
(ii) Community impact
(iii) Innovation
(iv) Leverage
(v) Size
(vi) New entry
(vii) Need for subsidy
(viii) Extent of distress in community
(2) Qualifying investments
(i) Determination of amount of assessment credit
(j) DefinitionsFor purposes of this section—
(1) Appropriate Federal banking agency
(2) Board
(3) Insured depository institution
(4) Community development financial institution
(5) Affiliate
(Pub. L. 102–242, title II, § 233, Dec. 19, 1991, 105 Stat. 2311; Pub. L. 102–550, title IX, § 931(c)–(e), title XVI, §§ 1604(b)(2), 1605(a)(7), Oct. 28, 1992, 106 Stat. 3888, 3889, 4083, 4086; Pub. L. 102–558, title III, §§ 303(b)(2), (9), 305, Oct. 28, 1992, 106 Stat. 4224, 4226; Pub. L. 103–325, title I, § 114(c), Sept. 23, 1994, 108 Stat. 2181.)

CITE AS: 12 USC 1834a

§ 1834b. Community development organizations
(a) Community development organizations describedFor purposes of this subtitle, any insured depository institution, or a qualified portion thereof, shall be treated as meeting the community development organization requirements of this section if—
(1) the institution—
(A) is a community development bank, or controls any community development bank, which meets the requirements of subsection (b);
(B) controls any community development corporation, or maintains any community development unit within the institution, which meets the requirements of subsection (c);
(C) invests in accounts in any community development credit union designated as a low-income credit union, subject to restrictions established for such credit unions by the National Credit Union Administration Board; or
(D) invests in a community development organization jointly controlled by two or more institutions;
(2) except in the case of an institution which is a community development bank, the amount of the capital invested, in the form of debt or equity, by the institution in the community development organization referred to in paragraph (1) (or, in the case of any community development unit, the amount which the institution irrevocably makes available to such unit for the purposes described in paragraph (3)) is not less than the greater of—
(A) ½ of 1 percent of the capital, as defined by generally accepted accounting principles, of the institution; or
(B) the sum of the amounts invested in such community development organization; and
(3) the community development organization provides loans for residential mortgages, home improvement, and community development and other financial services, other than financing for the purchase of automobiles or extension of credit under any open-end credit plan (as defined in section 1602(i) 1
1 See References in Text note below.
of title 15), to low- and moderate-income persons, nonprofit organizations, and small businesses located in qualified distressed communities in a manner consistent with the intent of this subtitle.
(b) Community development bank requirementsA community development bank meets the requirements of this subsection if—
(1) the community development bank has a 15-member advisory board designated as the “Community Investment Board” and consisting entirely of community leaders who—
(A) shall be appointed initially by the board of directors of the community development bank and thereafter by the Community Investment Board from nominations received from the community; and
(B) are appointed for a single term of 2 years, except that, of the initial members appointed to the Community Investment Board, ⅓ shall be appointed for a term of 8 months, ⅓ shall be appointed for a term of 16 months, and ⅓ shall be appointed for a term of 24 months, as designated by the board of directors of the community development bank at the time of the appointment;
(2) ⅓ of the members of the community development bank’s board of directors are appointed from among individuals nominated by the Community Investment Board; and
(3) the bylaws of the community development bank require that the board of directors of the bank meet with the Community Investment Board at least once every 3 months.
(c) Community development corporation requirements
(d) Adequate dispersal requirement
(e) DefinitionsFor purposes of this section—
(1) Community development bank
(2) Community development organization
(3) Low- and moderate-income persons
(4) Nonprofit organization; small business
(5) Qualified distressed community
(Pub. L. 102–242, title II, § 234, Dec. 19, 1991, 105 Stat. 2315.)

CITE AS: 12 USC 1834b

§ 1835. Insured depository institution capital requirements for transfers of small business obligations
(a) Accounting principles
(b) Capital and reserve requirements
With respect to the transfer of a small business loan or lease of personal property with recourse that is a sale under generally accepted accounting principles, each qualified insured depository institution shall—
(1) establish and maintain a reserve equal to an amount sufficient to meet the reasonable estimated liability of the institution under the recourse arrangement; and
(2) include, for purposes of applicable capital standards and other capital measures, only the amount of the retained recourse in the risk-weighted assets of the institution.
(c) Qualified institutions criteria
An insured depository institution is a qualified insured depository institution for purposes of this section if, without regard to the accounting principles or capital requirements referred to in subsections (a) and (b), the institution is—
(1) well capitalized; or
(2) with the approval, by regulation or order, of the appropriate Federal banking agency, adequately capitalized.
(d) Aggregate amount of recourse
The total outstanding amount of recourse retained by a qualified insured depository institution with respect to transfers of small business loans and leases of personal property under subsections (a) and (b) shall not exceed—
(1) 15 percent of the risk-based capital of the institution; or
(2) such greater amount, as established by the appropriate Federal banking agency by regulation or order.
(e) Institutions that cease to be qualified or exceed aggregate limits
(f) Prompt corrective action not affected
(g) Regulations required
(h) Alternative system permitted
(1) In general
(2) Existing transactions not affected
(i) Definitions
For purposes of this section—
(1) the term “adequately capitalized” has the same meaning as in section 1831o(b) of this title;
(2) the term “appropriate Federal banking agency” has the same meaning as in section 1813 of this title;
(3) the term “capital standards” has the same meaning as in section 1831o(c) of this title;
(4) the term “Federal banking agencies” has the same meaning as in section 1813 of this title;
(5) the term “insured depository institution” has the same meaning as in section 1813 of this title;
(6) the term “other capital measures” has the meaning as in section 1831o(c) of this title;
(7) the term “recourse” has the meaning given to such term under generally accepted accounting principles;
(8) the term “small business” means a business that meets the criteria for a small business concern established by the Small Business Administration under section 632(a) of title 15; and
(9) the term “well capitalized” has the same meaning as in section 1831o(b) of this title.
(Pub. L. 103–325, title II, § 208, Sept. 23, 1994, 108 Stat. 2201.)

CITE AS: 12 USC 1835

§ 1835a. Prohibition against deposit production offices
(a) Regulations
(b) Guidelines for meeting credit needs
(c) Limitation on out-of-State loans
(1) LimitationRegulations issued under subsection (a) shall require that, beginning no earlier than 1 year after establishment or acquisition of an interstate branch or branches in a host State by an out-of-State bank, if the appropriate Federal banking agency for the out-of-State bank determines that the bank’s level of lending in the host State relative to the deposits from the host State (as reasonably determinable from available information including the agency’s sampling of the bank’s loan files during an examination or such data as is otherwise available) is less than half the average of total loans in the host State relative to total deposits from the host State (as determinable from relevant sources) for all banks the home State of which is such State—
(A) the appropriate Federal banking agency for the out-of-State bank shall review the loan portfolio of the bank and determine whether the bank is reasonably helping to meet the credit needs of the communities served by the bank in the host State; and
(B) if the agency determines that the out-of-State bank is not reasonably helping to meet those needs—
(i) the agency may order that an interstate branch or branches of such bank in the host State be closed unless the bank provides reasonable assurances to the satisfaction of the appropriate Federal banking agency that the bank has an acceptable plan that will reasonably help to meet the credit needs of the communities served by the bank in the host State, and
(ii) the out-of-State bank may not open a new interstate branch in the host State unless the bank provides reasonable assurances to the satisfaction of the appropriate Federal banking agency that the bank will reasonably help to meet the credit needs of the community that the new branch will serve.
(2) ConsiderationsIn making a determination under paragraph (1)(A), the appropriate Federal banking agency shall consider—
(A) whether the interstate branch or branches of the out-of-State bank were formerly part of a failed or failing depository institution;
(B) whether the interstate branch was acquired under circumstances where there was a low loan-to-deposit ratio because of the nature of the acquired institution’s business or loan portfolio;
(C) whether the interstate branch or branches of the out-of-State bank have a higher concentration of commercial or credit card lending, trust services, or other specialized activities;
(D) the ratings received by the out-of-State bank under the Community Reinvestment Act of 1977 [12 U.S.C. 2901 et seq.];
(E) economic conditions, including the level of loan demand, within the communities served by the interstate branch or branches of the out-of-State bank; and
(F) the safe and sound operation and condition of the out-of-State bank.
(3) Branch closing procedure
(A) Notice required
(B) Hearing
(d) Application
(e) DefinitionsFor the purposes of this section, the following definitions shall apply:
(1) Appropriate Federal banking agency, bank, State, and State bank
(2) Home StateThe term “home State” means—
(A) in the case of a national bank, the State in which the main office of the bank is located; and
(B) in the case of a State bank, the State by which the bank is chartered.
(3) Host State
(4) Interstate branch
(5) Out-of-State bank
(Pub. L. 103–328, title I, § 109, Sept. 29, 1994, 108 Stat. 2362; Pub. L. 106–102, title I, § 106, Nov. 12, 1999, 113 Stat. 1359.)

CITE AS: 12 USC 1835a