HR 5841
110th CONGRESS
2d Session
H. R. 5841
To provide regulatory relief and improve productivity for insured
depository institutions, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
April 17, 2008
Mr. MOORE of Kansas (for himself and Mr. ROSKAM) introduced the following
bill; which was referred to the Committee on Financial Services
A BILL
To provide regulatory relief and improve productivity for insured
depository institutions, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title- This Act may be cited as the `Bank and Thrift Regulatory
Relief Act of 2008'.
(b) Table of Contents- The table of contents for this Act is as follows:
Sec. 1. Short title; table of contents.
TITLE I--NATIONAL BANK PROVISIONS
Sec. 101. National bank directors.
Sec. 102. Business organization flexibility for national banks.
TITLE II--SAVINGS ASSOCIATION PROVISIONS
Sec. 201. Restatement of authority for Federal savings associations to invest
in small business investment companies.
Sec. 202. Removal of limitation on investments in auto loans.
Sec. 203. Repeal of qualified thrift lender requirement with respect to
out-of-state branches.
Sec. 204. Small business and other commercial loans.
Sec. 205. Increase in limits on commercial real estate loans.
Sec. 206. Business organization flexibility for Federal savings associations.
Sec. 207. Savings association credit card banks.
TITLE III--NOTICE PROVISIONS
Sec. 301. Exception to annual privacy notice requirement under the Gramm-Leach-Bliley
Act.
TITLE IV--BUSINESS CHECKING
Sec. 402. Interest-bearing transaction accounts authorized for all businesses.
Sec. 403. Interest-bearing transaction accounts authorized.
Sec. 404. Rules of construction.
Sec. 405. Consumer banking costs assessment.
TITLE I--NATIONAL BANK PROVISIONS
SEC. 101. NATIONAL BANK DIRECTORS.
(a) In General- Section 5146 of the Revised Statutes of the United States
(12 U.S.C. 72) is amended--
(1) by striking `Sec. 5146. Every director must during' and inserting the
following:
`SEC. 5146. REQUIREMENTS FOR BANK DIRECTORS.
`(a) Residency Requirements- Every director of a national bank shall, during';
(2) by striking `total number of directors. Every director must own in his
or her own right' and inserting `total number of directors.
`(b) Investment Requirement-
`(1) IN GENERAL- Every director of a national bank shall own, in his or
her own right,'; and
(3) by adding at the end the following new paragraph:
`(2) EXCEPTION FOR SUBORDINATED DEBT IN CERTAIN CASES- In lieu of the requirements
of paragraph (1) relating to the ownership of capital stock in the national
bank, the Comptroller of the Currency may, by regulation or order, permit
an individual to serve as a director of a national bank that has elected,
or notifies the Comptroller of the bank's intention to elect, to operate
as a S corporation pursuant to section 1362(a) of the Internal Revenue Code
of 1986, if that individual holds debt of at least $1,000 issued by the
national bank that is subordinated to the interests of depositors and other
general creditors of the national bank.'.
(b) Clerical Amendment- The table of sections for chapter one of title LXII
of the Revised Statutes of the United States (12 U.S.C. 21 et seq.) is amended
by striking the item relating to section 5146 and inserting the following
new item:
`5146. Requirements for bank directors'.
SEC. 102. BUSINESS ORGANIZATION FLEXIBILITY FOR NATIONAL BANKS.
(a) In General- Chapter one of title LXII of the Revised Statutes of the United
States (12 U.S.C. 21 et seq.) is amended by inserting after section 5136B
the following new section:
`SEC. 5136C. ALTERNATIVE BUSINESS ORGANIZATION.
`(a) In General- The Comptroller of the Currency may prescribe regulations--
`(1) to permit a national bank to be organized other than as a body corporate;
and
`(2) to provide requirements for the organizational characteristics of a
national bank organized and operating other than as a body corporate, consistent
with the safety and soundness of the national bank.
`(b) Equal Treatment- Except as provided in regulations prescribed under subsection
(a), a national bank that is operating other than as a body corporate shall
have the same rights and privileges and shall be subject to the same duties,
restrictions, penalties, liabilities, conditions, and limitations as a national
bank that is organized as a body corporate.'.
(b) Technical and Conforming Amendment- Section 5136 of the Revised Statutes
of the United States (12 U.S.C. 24) is amended, in the matter preceding the
paragraph designated as the `First', by inserting `or other form of business
organization provided under regulations prescribed by the Comptroller of the
Currency under section 5136C' after `a body corporate'.
(c) Clerical Amendment- The table of sections for chapter one of title LXII
of the Revised Statutes of the United States (12 U.S.C. 21 et seq.) is amended
by inserting after the item relating to section 5136B the following new item:
`5136C. Alternative business organization.'.
TITLE II--SAVINGS ASSOCIATION PROVISIONS
SEC. 201. RESTATEMENT OF AUTHORITY FOR FEDERAL SAVINGS ASSOCIATIONS TO INVEST
IN SMALL BUSINESS INVESTMENT COMPANIES.
Subparagraph (D) of section 5(c)(4) of the Home Owners' Loan Act (12 U.S.C.
1464(c)(4)) is amended to read as follows:
`(D) SMALL BUSINESS INVESTMENT COMPANIES- Any Federal savings association
may invest in 1 or more small business investment companies, or in any
entity established to invest solely in small business investment companies
formed under the Small Business Investment Act of 1958, except that the
total amount of investments under this subparagraph may not at any time
exceed the amount equal to 5 percent of capital and surplus of the savings
association.'.
SEC. 202. REMOVAL OF LIMITATION ON INVESTMENTS IN AUTO LOANS.
(a) In General- Section 5(c)(1) of the Home Owners' Loan Act (12 U.S.C. 1464(c)(1))
is amended by adding at the end the following new subparagraph:
`(V) AUTO LOANS- Loans and leases for motor vehicles acquired for personal,
family, or household purposes.'.
(b) Technical and Conforming Amendment Relating to Qualified Thrift Investments-
Section 10(m)(4)(C)(ii) of the Home Owners' Loan Act (12 U.S.C. 1467a(m)(4)(C)(ii))
is amended by adding at the end the following new subclause:
`(VIII) Loans and leases for motor vehicles acquired for personal,
family, or household purposes.'.
SEC. 203. REPEAL OF QUALIFIED THRIFT LENDER REQUIREMENT WITH RESPECT TO
OUT-OF-STATE BRANCHES.
Section 5(r)(1) of the Home Owners' Loan Act (12 U.S.C. 1464(r)(1)) is amended
by striking the last sentence.
SEC. 204. SMALL BUSINESS AND OTHER COMMERCIAL LOANS.
(a) Elimination of Lending Limit on Small Business Loans- Section 5(c)(1)
of the Home Owners' Loan Act (12 U.S.C. 1464(c)(1)) is amended by inserting
after subparagraph (V) (as added by section 202(a) of this title) the following
new subparagraph:
`(W) SMALL BUSINESS LOANS- Small business loans, as defined in regulations
which the Director shall prescribe.'.
(b) Increase in Lending Limit on Other Business Loans- Section 5(c)(2)(A)
of the Home Owners' Loan Act (12 U.S.C. 1464(c)(2)(A)) is amended by striking
`, and amounts in excess of 10 percent' and all that follows through `by the
Director'.
SEC. 205. INCREASE IN LIMITS ON COMMERCIAL REAL ESTATE LOANS.
Section 5(c)(2)(B)(i) of the Home Owners' Loan Act (12 U.S.C. 1464(c)(2)(B)(i))
is amended by striking `400 percent' and inserting `500 percent'.
SEC. 206. BUSINESS ORGANIZATION FLEXIBILITY FOR FEDERAL SAVINGS ASSOCIATIONS.
(a) In General- Section 5 of the Home Owners' Loan Act (12 U.S.C. 1464) is
amended by adding at the end the following new subsection:
`(y) Alternative Business Organization-
`(1) IN GENERAL- The Director may prescribe regulations that--
`(A) permit a Federal savings association to be organized other than as
a corporation; and
`(B) provide requirements for the organizational characteristics of a
Federal savings association organized and operating other than as a corporation,
consistent with the safety and soundness of the Federal savings association.
`(2) EQUAL TREATMENT- Except as otherwise provided in regulations prescribed
under subsection (1), a Federal savings association that is operating other
than as a corporation shall have the same rights and privileges and shall
be subject to the same duties, restrictions, penalties, liabilities, conditions,
and limitations as a Federal savings association that is organized as a
corporation.'.
(b) Technical and Conforming Amendments-
(1) Section 5(a)(1) of the Home Owners' Loan Act (12 U.S.C. 1464(a)(1))
is amended by striking `organization, incorporation,' and inserting `organization
(as a corporation or other form of business organization provided under
regulations prescribed by the Director under subsection (x)),'.
(2) The last sentence of section 5(i)(1) of the Home Owners' Loan Act (12
U.S.C. 1464(i)(1)) is amended by striking `incorporated' and inserting `organized'.
(3) Section 5(o)(1) of the Home Owners' Loan Act (12 U.S.C. 1464(a)(1))
is amended by striking `organization, incorporation,' and inserting `organization
(as a corporation or other form of business organization provided under
regulations prescribed by the Director under subsection (x)),'.
SEC. 207. SAVINGS ASSOCIATION CREDIT CARD BANKS.
Section 10(a)(1)(A) of the Home Owners' Loan Act (12 U.S.C. 1467a(a)(1)(A))
is amended by inserting `and such term does not include an institution described
in section 2(c)(2)(F) of the Bank Holding Company Act of 1956 for purposes
of subsections (a)(1)(E), (c)(3)(B)(i), (c)(9)(C)(i), and (e)(3)' before the
period at the end.
TITLE III--NOTICE PROVISIONS
SEC. 301. EXCEPTION TO ANNUAL PRIVACY NOTICE REQUIREMENT UNDER THE GRAMM-LEACH-BLILEY
ACT.
Section 503 of the Gramm-Leach-Bliley Act (15 U.S.C. 6803) is amended by adding
the following new subsections:
`(c) Exception to Annual Notice Requirement- A financial institution that--
`(1) provides nonpublic personal information only in accordance with the
provisions of subsection (b)(2) or (e) of section 502 or regulations prescribed
under section 504(b);
`(2) does not share information with affiliates under section 603(d)(2)(A)(iii)
of the Fair Credit Reporting Act; and
`(3) has not changed its policies and practices with regard to disclosing
nonpublic personal information from the policies and practices that were
disclosed in the most recent disclosure sent to consumers in accordance
with this subsection,
shall not be required to provide an annual disclosure under this subsection
until such time as the financial institution fails to comply with any criteria
described in paragraph (1), (2), or (3).
`(d) Exception to Notice Requirement- A financial institution shall not be
required to provide any disclosure under this section if--
`(1) the financial institution is licensed by a State and is subject to
existing regulation of consumer confidentiality that prohibits disclosure
of nonpublic personal information without knowing and expressed consent
of the consumer in the form of laws, rules, or regulation of professional
conduct or ethics promulgated either by the court of highest appellate authority
or by the principal legislative body or regulatory agency or body of any
State of the United States, the District of Columbia, any territory of the
United States, Puerto Rico, Guam, American Samoa, the Trust Territory of
the Pacific Islands, the Virgin Islands, or the Northern Mariana Islands;
or
`(2) the financial institution is licensed by a State and becomes subject
to future regulation of consumer confidentiality that prohibits disclosure
of nonpublic personal information without knowing and expressed consent
of the consumer in the form of laws, rules, or regulation of professional
conduct or ethics promulgated either by the court of highest appellate authority
or by the principal legislative body or regulatory agency or body of any
State of the United States, the District of Columbia, any territory of the
United States, Puerto Rico, Guam, American Samoa, the Trust Territory of
the Pacific Islands, the Virgin Islands, or the Northern Mariana Islands.'.
TITLE IV--BUSINESS CHECKING
SEC. 401. SHORT TITLE.
This title may be cited as the `Business Checking Fairness Act of 2008'.
SEC. 402. INTEREST-BEARING TRANSACTION ACCOUNTS AUTHORIZED FOR ALL BUSINESSES.
Section 2 of Public Law 93-100 (12 U.S.C. 1832) is amended--
(1) by redesignating subsections (b) and (c) as subsections (c) and (d),
respectively; and
(2) by inserting after subsection (a) the following:
`(b) Notwithstanding any other provision of law, any depository institution
may permit the owner of any deposit or account which is a deposit or account
on which interest or dividends are paid and is not a deposit or account described
in subsection (a)(2) to make up to 24 transfers per month (or such greater
number as the Board of Governors of the Federal Reserve System may determine
by rule or order), for any purpose, to another account of the owner in the
same institution. An account offered pursuant to this subsection shall be
considered a transaction account for purposes of section 19 of the Federal
Reserve Act unless the Board of Governors of the Federal Reserve System determines
otherwise.'.
SEC. 403. INTEREST-BEARING TRANSACTION ACCOUNTS AUTHORIZED.
(a) Repeal of Prohibition on Payment of Interest on Demand Deposits-
(1) FEDERAL RESERVE ACT- Section 19(i) of the Federal Reserve Act (12 U.S.C.
371a) is amended to read as follows:
(2) HOME OWNERS' LOAN ACT- The first sentence of section 5(b)(1)(B) of the
Home Owners' Loan Act (12 U.S.C. 1464(b)(1)(B)) is amended by striking `savings
association may not--' and all that follows through `(ii) permit any' and
inserting `savings association may not permit any'.
(3) FEDERAL DEPOSIT INSURANCE ACT- Section 18(g) of the Federal Deposit
Insurance Act (12 U.S.C. 1828(g)) is amended to read as follows:
(b) Effective Date- The amendments made by subsection (a) shall take effect
at the end of the 2-year period beginning on the date of the enactment of
this Act.
SEC. 404. RULES OF CONSTRUCTION.
In the case of an escrow account maintained at a depository institution for
the purpose of completing the settlement of a real estate transaction--
(1) the absorption, by the depository institution, of expenses incidental
to providing a normal banking service with respect to such escrow account;
(2) the forbearance, by the depository institution, from charging a fee
for providing any such banking function; and
(3) any benefit which may accrue to the holder or the beneficiary of such
escrow account as a result of an action of the depository institution described
in subparagraph (1) or (2) or similar in nature to such action, including
any benefits which have been so determined by the appropriate Federal regulator,
shall not be treated as the payment or receipt of interest for purposes of
this title and any provision of Public Law 93-100, the Federal Reserve Act,
the Home Owners' Loan Act, or the Federal Deposit Insurance Act relating to
the payment of interest on accounts or deposits at depository institutions.
No provision of this title shall be construed so as to require a depository
institution that maintains an escrow account in connection with a real estate
transaction to pay interest on such escrow account or to prohibit such institution
from paying interest on such escrow account. No provision of this title shall
be construed as preempting the provisions of law of any State dealing with
the payment of interest on escrow accounts maintained in connection with real
estate transactions.
SEC. 405. CONSUMER BANKING COSTS ASSESSMENT.
(a) In General- The Federal Reserve Act (12 U.S.C. 221 et seq.) is amended--
(1) by redesignating sections 30 and 31 as sections 31 and 32, respectively;
and
(2) by inserting after section 29 the following new section:
`SEC. 30. SURVEY OF BANK FEES AND SERVICES.
`(a) Biennial Survey Required- The Board of Governors of the Federal Reserve
System shall obtain biennially a sample, which is representative by type and
size of the institution (including small institutions) and geographic location,
of the following retail banking services and products provided by insured
depository institutions and insured credit unions (along with related fees
and minimum balances):
`(1) Checking and other transaction accounts.
`(2) Negotiable order of withdrawal and savings accounts.
`(3) Automated teller machine transactions.
`(4) Other electronic transactions.
`(b) Minimum Survey Requirement- The biennial survey described in subsection
(a) shall meet the following minimum requirements:
`(1) CHECKING AND OTHER TRANSACTION ACCOUNTS- Data on checking and transaction
accounts shall include, at a minimum, the following:
`(A) Monthly and annual fees and minimum balances to avoid such fees.
`(B) Minimum opening balances.
`(C) Check processing fees.
`(D) Check printing fees.
`(E) Balance inquiry fees.
`(F) Fees imposed for using a teller or other institution employee.
`(G) Stop payment order fees.
`(H) Nonsufficient fund fees.
`(J) Fees imposed in connection with bounced-check protection and overdraft
protection programs.
`(K) Deposit items returned fees.
`(L) Availability of no-cost or low-cost accounts for consumers who maintain
low balances.
`(2) NEGOTIABLE ORDER OF WITHDRAWAL ACCOUNTS AND SAVINGS ACCOUNTS- Data
on negotiable order of withdrawal accounts and savings accounts shall include,
at a minimum, the following:
`(A) Monthly and annual fees and minimum balances to avoid such fees.
`(B) Minimum opening balances.
`(C) Rate at which interest is paid to consumers.
`(D) Check processing fees for negotiable order of withdrawal accounts.
`(E) Fees imposed for using a teller or other institution employee.
`(F) Availability of no-cost or low-cost accounts for consumers who maintain
low balances.
`(3) AUTOMATED TELLER TRANSACTIONS- Data on automated teller machine transactions
shall include, at a minimum, the following:
`(A) Monthly and annual fees.
`(C) Fees charged to customers for withdrawals, deposits, and balance
inquiries through institution-owned machines.
`(D) Fees charged to customers for withdrawals, deposits, and balance
inquiries through machines owned by others.
`(E) Fees charged to noncustomers for withdrawals, deposits, and balance
inquiries through institution-owned machines.
`(F) Point-of-sale transaction fees.
`(4) OTHER ELECTRONIC TRANSACTIONS- Data on other electronic transactions
shall include, at a minimum, the following:
`(B) Fees related to payments made over the Internet or through other
electronic means.
`(5) OTHER FEES AND CHARGES- Data on any other fees and charges that the
Board of Governors of the Federal Reserve System determines to be appropriate
to meet the purposes of this section.
`(6) FEDERAL RESERVE BOARD AUTHORITY- The Board of Governors of the Federal
Reserve System may cease the collection of information with regard to any
particular fee or charge specified in this subsection if the Board makes
a determination that, on the basis of changing practices in the financial
services industry, the collection of such information is no longer necessary
to accomplish the purposes of this section.
`(c) Biennial Report to Congress Required-
`(1) PREPARATION- The Board of Governors of the Federal Reserve System shall
prepare a report of the results of each survey conducted pursuant to subsections
(a) and (b) of this section and section 136(b)(1) of the Consumer Credit
Protection Act.
`(2) CONTENTS OF THE REPORT- In addition to the data required to be collected
pursuant to subsections (a) and (b), each report prepared pursuant to paragraph
(1) shall include a description of any discernible trend, in the Nation
as a whole, in a representative sample of the 50 States (selected with due
regard for regional differences), and in each consolidated metropolitan
statistical area (as defined by the Director of the Office of Management
and Budget), in the cost and availability of the retail banking services,
including those described in subsections (a) and (b) (including related
fees and minimum balances), that delineates differences between institutions
on the basis of the type of institution and the size of the institution,
between large and small institutions of the same type, and any engagement
of the institution in multistate activity.
`(3) SUBMISSION TO THE CONGRESS- The Board of Governors of the Federal Reserve
System shall submit an biennial report to the Congress not later than June
1, 2009, and before the end of each 2-year period beginning after such date.
`(d) Definitions- For purposes of this section, the term `insured depository
institution' has the meaning given such term in section 3 of the Federal Deposit
Insurance Act, and the term `insured credit union' has the meaning given such
term in section 101 of the Federal Credit Union Act.'.
(b) Conforming Amendment-
(1) IN GENERAL- Paragraph (1) of section 136(b) of the Truth in Lending
Act (15 U.S.C. 1646(b)(1)) is amended to read as follows:
`(1) COLLECTION REQUIRED- The Board shall collect, on a semiannual basis,
from a broad sample of financial institutions which offer credit card services,
credit card price and availability information including--
`(A) the information required to be disclosed under section 127(c);
`(B) the average total amount of finance charges paid by consumers; and
`(C) the following credit card rates and fees:
`(ii) Annual percentage rates for cash advances and balance transfers.
`(iii) Maximum annual percentage rate that may be charged when an account
is in default.
`(iv) Fees for the use of convenience checks.
`(v) Fees for balance transfers.
`(vi) Fees for foreign currency conversions.'.
(2) EFFECTIVE DATE- The amendment made by paragraph (1) shall take effect
on January 1, 2009.
(c) Repeal of Other Report Provisions- Section 1002 of Financial Institutions
Reform, Recovery, and Enforcement Act of 1989 and section 108 of the Riegle-Neal
Interstate Banking and Branching Efficiency Act of 1994 are hereby repealed.
END
