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1000 - Federal Deposit Insurance Act


(i)  INSURANCE OF TRUST FUNDS.--

(1)  IN GENERAL.--Trust funds held on deposit by an insured depository institution in a fiduciary capacity as trustee pursuant to any irrevocable trust established pursuant to any statute or written trust agreement shall be insured in an amount not to exceed the standard maximum deposit insurance amount (as determined under section 11(a)(1)) for each trust estate.

(2)  INTERBANK DEPOSITS.--Trust funds described in paragraph (1) which are deposited by the fiduciary depository institution in another insured depository institution shall be similarly insured to the fiduciary depository institution according to the trust estates represented.

(3)  BANK DEPOSIT FINANCIAL ASSISTANCE PROGRAM.--Notwithstanding paragraph (1), funds deposited by an insured depository institution pursuant to the Bank Deposit Financial Assistance Program of the Department of Energy shall be separately insured in an amount not to exceed the standard maximum deposit insurance amount (as determined under section 11(a)(1)) for each insured depository institution depositing such funds.

(4)  REGULATIONS.--The Board of Directors may prescribe such regulations as may be necessary to clarify the insurance coverage under this subsection and to prescribe the manner of reporting and depositing such trust funds.

[Codified to 12 U.S.C. 1817(i)]

[Source:  Section 2[7(i)] of the Act of September 21, 1950 (Pub. L. No. 797; 64 Stat. 879), effective September 21, 1950, as amended by section 3 of the Act of July 14, 1960 (Pub. L. No. 86--671; 74 Stat. 551), effective January 1, 1961; section 301(b) of title III of the Act of October 16, 1966 (Pub. L. No. 89--695; 80 Stat. 1055), effective October 16, 1966; section 7(a)(2) of title I of the Act of December 23, 1969 (Pub. L. No. 91--51; 83 Stat. 376), effective December 23, 1969; sections 101(a)(2) and 102(a)(2) of title I of the Act of October 28, 1974 (Pub. L. No. 93--495; 88 Stat. 1500 and 1502), effective November 27, 1974; section 308 of title III of the Act of March 31, 1980 (Pub. L. No. 96--221; 94 Stat. 147), effective March 31, 1980; sections 201(a)(1) and 208(7) of title II of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 187 and 213, respectively), effective August 9, 1989; section 311(b)(3) of title III of the Act of December 19, 1991 (Pub. L. No. 102--242; 105 Stat. 2365), effective December 19, 1993; section 38(a) of the Act of December 17, 1993 (Pub. L. No. 103--204; 107 Stat. 2416), effective December 19, 1993; section 2(b) of the Act of February 15, 2006 (Pub. L. No. 109--173; 119 Stat. 3602), effective date shall take effect on the date on which the final regulations required under section 2109(a)(2) of the Federal Deposit Insurance Reform Act of 2005 take effect]


(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, United States Code.

(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 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.

(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, United States Code. 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 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, 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 or prejudice the interests of the depositors of the bank;

(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;

(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 term "foreign bank" and "affiliate" have the same meanings as in section 1 of the International Banking Act of 1978.

(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 13 of the Securities Exchange Act of 1934 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, section 10 of the Home Owners' Loan Act, 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 8(n) 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 8(n).

(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], the date of the enactment of this sentence).

(16)  CIVIL MONEY PENALTY.--

(A)  FIRST TIER.--Any person who violates any provision of this subsection, or any regulation or order issued by the appropriate Federal banking agency under this subsection, shall forfeit and pay a civil penalty of not more than $5,000 for each day during which such violation continues.

(B)  SECOND TIER.--Notwithstanding subparagraph (A), any person who--

(i)(I)  commits any violation described in any clause of subparagraph (A);

(II)  recklessly engages in an unsafe or unsound practice in conducting the affairs of a depository institution; or

(III)  breaches any fiduciary duty;

(ii)  which violation, practice, or breach--

(I)  is part of a pattern of misconduct;

(II)  causes or is likely to cause more than a minimal loss to such institution; or

(III)  results in pecuniary gain or other benefit to such person,

shall forfeit and pay a civil penalty of not more than $25,000 for each day during which such violation, practice, or breach continues.

(C)  THIRD TIER.--Notwithstanding subparagraphs (A) and (B), any person who--

(i)  knowingly--

(I)  commits any violation described in any clause of subparagraph (A);

(II)  engages in any unsafe or unsound practice in conducting the affairs of a depository institution; or

(III)  breaches any fiduciary duty; and

(ii)  knowingly or recklessly causes a substantial loss to such institution or a substantial pecuniary gain or other benefit to such person by reason of such violation, practice, or breach,

shall forfeit and pay a civil penalty in an amount not to exceed the applicable maximum amount determined under subparagraph (D) for each day during which such violation, practice, or breach continues.

(D)  MAXIMUM AMOUNTS OF PENALTIES FOR ANY VIOLATION DESCRIBED IN SUBPARAGRAPH (c).--The maximum daily amount of any civil penalty which may be assessed pursuant to subparagraph (C) for any violation, practice, or breach described in such subparagraph is--

(i)  in the case of any person other than a depository institution, an amount to not exceed $1,000,000; and

(ii)  in the case of a depository institution, an amount not to exceed the lesser of--

(I)  $1,000,000; or

(II)  1 percent of the total assets of such institution.

(E)  ASSESSMENT; ETC.--Any penalty imposed under subparagraph (A), (B), or (C) shall be assessed and collected by the appropriate Federal banking agency in the manner provided in subparagraphs (E), (F), (G), and (I) of section 8(i)(2) for penalties imposed (under such section) and any such assessment shall be subject to the provisions of such section.

(F)  HEARING.--The depository institution or other person against whom any penalty is assessed under this paragraph shall be afforded an agency hearing if such institution or other person submits a request for such hearing within 20 days after the issuance of the notice of assessment. Section 8(h) shall apply to any proceeding under this paragraph.

(G)  DISBURSEMENT.--All penalties collected under authority of this paragraph shall be deposited into the Treasury.

(17)  EXCEPTIONS.--This subsection shall not apply with respect to a transaction which is subject to--

(A)  section 3 of the Bank Holding Company Act of 1956;

(B)  section 18(c) of this Act; or

(C)  section 10 of the Home Owners' Loan Act.

(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.

[Codified to 12 U.S.C. 1817(j)]

[Source:  Section 2[7(j)] of the Act of September 21, 1950 (Pub. L. No. 797), as added by the Act of September 12, 1964 (Pub. L. No. 88--593; 78 Stat. 940), effective September 12, 1964; and as amended by section 201 of title II of the Act of October 16, 1966 (Pub. L. No. 89--695; 80 Stat. 1046), effective October 16, 1966; sections 6(c)(12) and (13) of the Act of September 17, 1978 (Pub. L. No. 95--369; 92 Stat. 617--618), effective September 17, 1978; section 602 of title VI of the Act of November 10, 1978 (Pub. L. No. 95--630; 92 Stat. 3683), effective March 10, 1979; section 113(q) of title I of the Act of October 15, 1982 (Pub. L. No. 97--320; 96 Stat. 1475), effective October 15, 1982; section 1360 of subtitle H of title I of the Act of October 27, 1986 (Pub. L. No. 99--570; 100 Stat. 3207--29--3207--31), effective with respect to notices of proposed acquisitions filed after the date of the enactment of this Act (October 27, 1986); sections 201(a)(1) and 208(8)--(13) of title II and sections 905(c) and 907(d) of title IX of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 187, 213, 460 and 468, respectively), effective August 9, 1989; section 205 of title II of the Act of December 19, 1991 (Pub. L. No. 102--242; 105 Stat. 2292), effective December 19, 1991; section 602(a)(6) and (7) of title VI of the Act of September 23, 1994 (Pub. L. No. 103--325; 108 Stat. 2288), effective September 23, 1994; section 2226 of title II of the Act of September 30, 1996 (Pub. L. No. 104--208; 110 Stat. 3009--417), effective September 30, 1996; section 8(a)(9) of the Act of February 15, 2006 (Pub. L. No. 109--173; 119 Stat. 3611), effective date shall take effect on the day of the merger of the bank Insurance Fund and the Savings Association Insurance Fund pursuant to the Federal Deposit Insurance Reform Act of 2005; section 705 of title VII of the Act of October 13, 2006 (Pub. L. No. 109--351; 120 Stat. 1987), effective October 13, 2006]

(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.--The appropriate Federal banking agencies are authorized to issue rules and regulations, including definitions of terms, to require the reporting and public disclosure of information by a bank or any executive officer or principal shareholder thereof concerning extensions of credit by the bank to any of its executive officers or principal shareholders, or the related interests of such persons.

[Codified to 12 U.S.C. 1817(k)]

[Source:  Section 2[7(k)] of the Act of September 21, 1950 (Pub. L. No. 797), as added by section 901 of title IX of the Act of November 10, 1978 (Pub. L. No. 95--630; 92 Stat. 3693), effective March 10, 1979; as amended by section 429 of title IV of the Act of October 15, 1982 (Pub. L. No. 97--320; 96 Stat. 1527), effective October 15, 1982]

(l)  DESIGNATION OF FUND MEMBERSHIP FOR NEWLY INSURED DEPOSITORY INSTITUTIONS; DEFINITIONS.--For purposes of this section:

(1)  BANK INSURANCE FUND.--Any institution which--

(A)  becomes an insured depository institution; and

(B)  does not become a Savings Association Insurance Fund member pursuant to paragraph (2),

shall be a Bank Insurance Fund member.

(2)  SAVINGS ASSOCIATION INSURANCE FUND.--Any savings association, other than any Federal savings bank chartered pursuant to section 5(o) of the Home Owners' Loan Act, which becomes an insured depository institution shall be a Savings Association Insurance Fund member.

(3)  TRANSITION PROVISION.--

(A)  BANK INSURANCE FUND.--Any depository institution the deposits of which were insured by the Federal Deposit Insurance Corporation on [August 9, 1989], the day before the date of the enactment of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, including--

(i)  any Federal savings bank chartered pursuant to section 5(o) of the Home Owners' Loan Act; and

(ii)  any cooperative bank,

shall be a Bank Insurance Fund member as of [August 9, 1989], such date of enactment.

(B)  SAVINGS ASSOCIATION INSURANCE FUND.--Any savings association which is an insured depository institution by operation of section 4(a)(2) shall be a Savings Association Insurance Fund member as of [August 9, 1989], the date of the enactment of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989.

(4)  BANK INSURANCE FUND MEMBER.--The term "Bank Insurance Fund member" means any depository institution the deposits of which are insured by the Bank Insurance Fund.

(5)  SAVINGS ASSOCIATION INSURANCE FUND MEMBER.--The term "Savings Association Insurance Fund member" means any depository institution the deposits of which are insured by the Savings Association Insurance Fund.

(6)  BANK INSURANCE FUND RESERVE RATIO.--The term "Bank Insurance Fund reserve ratio" means the ratio of the net worth of the Bank Insurance Fund to the value of the aggregate estimated insured deposits held in all Bank Insurance Fund members.

(7)  SAVINGS ASSOCIATION INSURANCE FUND RESERVE RATIO.-- The term "Savings Association Insurance Fund reserve ratio" means the ratio of the net worth of the Savings Association Insurance Fund to the value of the aggregate estimated insured deposits held in all Savings Association Insurance Fund members.

[Codified to 12 U.S.C. 1817(l)]

[Source: Section 2[7(l)] of the Act of September 21, 1950 (Pub. L. No. 797), effective September 21, 1950, as added by section 208(14) of title II of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 213), effective August 9, 1989; section 602(a)(8) of title VI of the Act of September 23, 1994 (Pub. L. No. 103--325; 108 Stat. 2288), effective September 23, 1994]

(m)  SECONDARY RESERVE OFFSETS AGAINST PREMIUMS.--

(1)  OFFSETS IN CALENDAR YEARS BEGINNING BEFORE 1993.-- Subject to the maximum amount limitation contained in paragraph (2) and notwithstanding any other provision of law, any insured savings association may offset such association's pro rata share of the statutorily prescribed amount against any premium assessed against such association under subsection (b) of this section for any calendar year beginning before 1993.

(2)  ANNUAL MAXIMUM AMOUNT LIMITATION.--The amount of any offset allowed for any savings association under paragraph (1) for any calendar year beginning before 1993 shall not exceed an amount which is equal to 20 percent of such association's pro rata share of the statutorily prescribed amount (as computed for such calendar year).

(3)  OFFSETS IN CALENDAR YEARS BEGINNING AFTER 1992.-- Notwithstanding any other provision of law, a savings association may offset such association's pro rata share of the statutorily prescribed amount against any premium assessed against such association under subsection (b) for any calendar year beginning after 1992.

(4)  TRANSFERABILITY.--No right, title, or interest of any insured depository institution in or with respect to its pro rata share of the secondary reserve shall be assignable or transferable whether by operation of law or otherwise, except to the extent that the Corporation may provide for transfer of such pro rata share in cases of merger or consolidation, transfer of bulk assets or assumption of liabilities, and similar transactions, as defined by the Corporation for purposes of this paragraph.

(5)  PRO RATA DISTRIBUTION ON TERMINATION OF INSURED STATUS.--If--

(A)  the status of any savings association as an insured depository institution is terminated pursuant to any provision of section 8 or the insurance of accounts of any 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 DEFINED.--For purposes of this subsection, the term "statutorily prescribed amount" means, with respect to any calendar year which ends after [August 9, 1989], the date of the enactment of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989--

(A)  $823,705,000, minus

(B)  the sum of--

(i)  the aggregate amount of offsets made before such date of enactment by all insured institutions under section 404(e)(2) of the National Housing Act (as in effect before [August 9, 1989], such date of enactment); and

(ii)  the aggregate amount of offsets made by all savings associations under this subsection before the beginning of such calendar year.

(7)  SAVINGS ASSOCIATION'S PRO RATA AMOUNT.--For purposes of this subsection, any savings association's pro rata share of the statutorily prescribed amount is the percentage which is equal to such association's share of the secondary reserve as determined under section 404(e) of the National Housing Act on the day before the date on which the Federal Savings and Loan Insurance Corporation ceased to recognize the secondary reserve (as such Act was in effect on the day before such date).

(8)  YEAR OF ENACTMENT RULE.--With respect to the calendar year in which the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 is enacted, the Corporation shall make such adjustments as may be necessary--

(A)  in the computation of the statutorily prescribed amount which shall be applicable for the remainder of such calendar year after taking into account the aggregate amount of offsets by all insured institutions under section 404(e)(2) of the National Housing Act (as in effect before the date of the enactment of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989) after the beginning of [August 9, 1989], such calendar year and before such date of enactment; and

(B)  in the computation of the maximum amount of any savings association's offset for such calendar year under paragraph (1) after taking into account--

(i)  the amount of any offset by such savings association under section 404(e)(2) of the National Housing Act (as in effect before [August 9, 1989], such date of enactment) after the beginning of such calendar year and before such date of enactment; and

(ii)  the change of such association's premium year from the 1-year period applicable under section 404(b) of the National Housing Act (as in effect before [August 9, 1989] such date of enactment) to a calendar year basis.

[Codified to 12 U.S.C. 1817(m)]

[Source: Section 2[7(m)] of the Act of September 21, 1950 (Pub. L. No. 797), effective September 21, 1950, as added by section 208(15) of title II of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 214), effective August 9, 1989; section 608(a)(9) and (10) of title VI of the Act of September 23, 1994 (Pub. L. No. 103--325; 108 Stat. 2288), effective September 23, 1994]

(n)  COLLECTIONS ON BEHALF OF THE COMPTROLLER OF THE CURRENCY.----When requested by the Comptroller of the Currency, the Corporation shall collect on behalf of the Comptroller assessments on Federal savings associations levied by the Comptroller under section 9 of the Home Owners' Loan Act. The Corporation shall be reimbursed for its actual costs for the collection of such assessments. Any such assessments by the Comptroller shall be in addition to any amounts assessed by the Corporation.

[Codified to 12 U.S.C. 1817(n)]

[Source: Section 2[7(n)] of the Act of September 21, 1950 (Pub. L. No. 797), effective September 21, 1950, as added by section 208(15) of title II of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 214), effective August 9, 1989; as amended by section 363(b)(2) of title III of the Act of July 21, 2010 (Pub. L. No. 111--203; 124 Stat. 1550), effective July 21, 2010]

NOTES

Derivation.  Sections 7(a)--(j) derive from section 12B(h) of the Federal Reserve Act, as added by section 101 [12B(h)] of title I of the Act of August 23, 1935 (Pub. L. No. 305; 49 Stat. 688), effective August 23, 1935. Section 12B(h) of the Federal Reserve Act was amended by section 1 of the Act of April 13, 1943 (Pub. L. No. 37; 57 Stat. 65), effective April 13, 1943. By section 1 of the Act of September 21, 1950 (Pub. L. No. 797; 64 Stat. 873), effective September 21, 1950, section 12B of the Federal Reserve Act was withdrawn as a part of that Act and was made a separate act known as the "Federal Deposit Insurance Act."

Section 7(k) was added by section 901 of title IX of the Act of November 10, 1978 (Pub. L. No. 95--630; 92 Stat. 3693), effective March 10, 1979.

Sections 7(l)--(n) were added by section 208 of title II of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 213 and 214), effective August 9, 1989.


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