To provide for the merger of the bank and savings association deposit insurance funds, to modernize and improve the safety and fairness of the Federal deposit insurance system, and for other purposes.

January 29, 2003

Mr. JOHNSON (for himself, Mr. HAGEL, Mr. REED, Mr. ENZI, Ms. STABENOW, and Mr. ALLARD) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs

To provide for the merger of the bank and savings association deposit insurance funds, to modernize and improve the safety and fairness of the Federal deposit insurance system, 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 `Safe and Fair Deposit Insurance Act of 2003'.

(b) TABLE OF CONTENTS- The table of contents for this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Definitions.

TITLE I--MERGER OF THE DEPOSIT INSURANCE FUNDS

Sec. 101. Short title.

Sec. 102. Merger of BIF and SAIF.

Sec. 103. Establishment of the Deposit Insurance Fund.

Sec. 104. Technical and conforming amendments to the Federal Deposit Insurance Act.

Sec. 105. Other technical and conforming amendments.

Sec. 106. Effective date.

TITLE II--DEPOSIT INSURANCE MODERNIZATION AND IMPROVEMENT

Sec. 201. Short title.

Sec. 202. Increase in Federal insurance coverage.

Sec. 203. Designated reserve ratio.

Sec. 204. Credits based on past contributions to Deposit Insurance Fund.

Sec. 205. Regulations required.

Sec. 206. Studies of potential changes to the Federal deposit insurance system.

Sec. 207. Effective date.

SEC. 2. DEFINITIONS.

In this Act--

(1) the term `Administration' means the National Credit Union Administration;

(2) the term `Board' means the Board of Directors of the Federal Deposit Insurance Corporation (other than in connection with the National Credit Union Administration Board);

(3) the term `Corporation' means the Federal Deposit Insurance Corporation;

(4) the term `designated reserve ratio' means the reserve ratio designated by the Board under section 7(b)(3) of the Federal Deposit Insurance Act, as amended by this Act;

(5) the terms `Fund' and `Deposit Insurance Fund' mean the Deposit Insurance Fund established under section 11(a)(4) of the Federal Deposit Insurance Act, as amended by this Act;

(6) the term `insured depository institution' has the same meaning as in section 3 of the Federal Deposit Insurance Act; and

(7) the term `reserve ratio' means the ratio of the fund balance of the Deposit Insurance Fund to the aggregate estimated amount of deposits insured by the Fund.

TITLE I--MERGER OF THE DEPOSIT INSURANCE FUNDS

SEC. 101. SHORT TITLE.

This title may be cited as the `Insurance Funds Merger Act of 2003'.

SEC. 102. MERGER OF BIF AND SAIF.

(a) IN GENERAL-

(1) MERGER- The Bank Insurance Fund and the Savings Association Insurance Fund shall be merged into the Deposit Insurance Fund.

(2) DISPOSITION OF ASSETS AND LIABILITIES- All assets and liabilities of the Bank Insurance Fund and the Savings Association Insurance Fund shall be transferred to the Deposit Insurance Fund.

(3) NO SEPARATE EXISTENCE- The separate existence of the Bank Insurance Fund and the Savings Association Insurance Fund shall cease on the effective date of the merger thereof under this section.

(b) REPEAL OF OUTDATED MERGER PROVISION- Section 2704 of the Deposit Insurance Funds Act of 1996 (12 U.S.C. 1821 note) is repealed.

SEC. 103. ESTABLISHMENT OF THE DEPOSIT INSURANCE FUND.

(a) IN GENERAL- Section 11(a)(4) of the Federal Deposit Insurance Act (12 U.S.C. 1821(a)(4)) is amended--

(1) by redesignating subparagraph (B) as subparagraph (C);

(2) by striking subparagraph (A) and inserting the following:

`(A) ESTABLISHMENT- There 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 13(a).

`(B) USES- The Deposit Insurance Fund shall be available to the Corporation for use with respect to Deposit Insurance Fund members.';

(3) by striking `(4) GENERAL PROVISIONS RELATING TO FUNDS- ' and inserting the following:

`(4) ESTABLISHMENT OF THE DEPOSIT INSURANCE FUND- ';

(4) in subparagraph (C), as redesignated by paragraph (1) of this subsection, by striking `Bank Insurance Fund and the Savings Association Insurance Fund' and inserting `Deposit Insurance Fund'; and

(5) by adding at the end the following:

`(D) DEPOSITS- All amounts assessed against insured depository institutions by the Corporation shall be deposited in the Deposit Insurance Fund.'.

(b) MERGER-RELATED AMENDMENTS TO THE FEDERAL DEPOSIT INSURANCE ACT-

(1) DEFINITIONS- Section 3(y) of the Federal Deposit Insurance Act (12 U.S.C. 1813(y)) is amended to read as follows:

`(y) DEFINITIONS RELATING TO THE DEPOSIT INSURANCE FUND-

`(1) DEPOSIT INSURANCE FUND- The term `Deposit Insurance Fund' means the fund established under section 11(a)(4).'.

(2) ASSESSMENTS- Section 7 of the Federal Deposit Insurance Act (12 U.S.C. 1817) is amended--

(A) by striking subsection (l);

(B) by redesignating subsections (m) and (n) as subsections (l) and (m), respectively; and

(C) in subsection (b), by striking paragraph (2) and inserting the following:

`(2) ASSESSMENTS-

`(A) IN GENERAL- Each insured depository institution shall pay assessments to the Corporation in such amounts and at such time or times as the Board of Directors may require.

`(B) FACTORS TO BE CONSIDERED- In setting assessments for insured depository institutions, the Board of Directors shall consider--

`(i) the estimated operating expenses of the Deposit Insurance Fund;

`(ii) the estimated case resolution expenditures and income of the Deposit Insurance Fund;

`(iii) the projected effects of assessments on the earnings and capital of insured depository institutions;

`(iv) the need to maintain a risk-based assessment system under paragraph (1); and

`(v) any other factors that the Board of Directors may determine to be appropriate.

`(C) NOTICE OF ASSESSMENTS- The Corporation shall notify each insured depository institution of assessments charged to that institution.

`(D) NEWLY INSURED INSTITUTIONS- To facilitate the administration of this section, the Board of Directors may waive the requirements of paragraphs (1) and (2) for any assessment period in which a depository institution becomes insured.'.

(3) REPEAL OF SEPARATE FUNDS PROVISIONS- Section 11(a) of the Federal Deposit Insurance Act (12 U.S.C. 1821(a)) is amended--

(A) by striking paragraphs (5), (6), and (7); and

(B) by redesignating paragraph (8) as paragraph (5).

SEC. 104. TECHNICAL AND CONFORMING AMENDMENTS TO THE FEDERAL DEPOSIT INSURANCE ACT.

The Federal Deposit Insurance Act (12 U.S.C. 1811 et seq.) is amended--

(1) in section 3(a)(1) (12 U.S.C. 1813(a)(1)), by striking subparagraph (B) and inserting the following:

`(B) includes any former savings association.';

(2) in section 5(b)(5) (12 U.S.C. 1815(b)(5)), by striking `the Bank Insurance Fund or the Savings Association Insurance Fund;' and inserting `the Deposit Insurance Fund,';

(3) in section 5(c)(4), by striking `deposit insurance fund' and inserting `Deposit Insurance Fund';

(4) in section 5(d) (12 U.S.C. 1815(d)), by striking paragraphs (2) and (3);

(5) in section 5(d)(1) (12 U.S.C. 1815(d)(1))--

(A) in subparagraph (A), by striking `reserve ratios in the Bank Insurance Fund and the Savings Association Insurance Fund as required by section 7' and inserting `the reserve ratio of the Deposit Insurance Fund';

(B) by striking subparagraph (B) and inserting the following:

`(2) FEE CREDITED TO THE DEPOSIT INSURANCE FUND- The fee paid by the depository institution under paragraph (1) shall be credited to the Deposit Insurance Fund.';

(C) by striking `INSTITUTIONS- ' and all that follows through `GENERAL- ' and inserting `INSTITUTIONS- '; and

(D) by redesignating subparagraph (C) as paragraph (3) and moving the margin 2 ems to the left;

(6) in section 5(e) (12 U.S.C. 1815(e))--

(A) in paragraph (5)(A), by striking `Bank Insurance Fund or the Savings Association Insurance Fund' and inserting `Deposit Insurance Fund';

(B) by striking paragraph (6); and

(C) by redesignating paragraphs (7), (8), and (9) as paragraphs (6), (7), and (8), respectively;

(7) in section 6(5) (12 U.S.C. 1816(5)), by striking `Bank Insurance Fund or the Savings Association Insurance Fund' and inserting `Deposit Insurance Fund';

(8) in section 7(a)(3) (12 U.S.C. 1817(a)(3))--

(A) by striking `in July'; and

(B) by striking `in January';

(9) in section 7(b) (12 U.S.C. 1817(b))--

(A) in paragraph (1)--

(i) in subparagraph (B)(ii), by striking `institution's semiannual assessment' and inserting `assessments for that institution under subsection (b)'; and

(ii) in subparagraph (C)--

(I) by striking `a depository institution's semiannual assessment' and inserting `assessments for a depository institution under subsection (b)'; and

(II) by striking `deposit insurance fund' each place that term appears and inserting `Deposit Insurance Fund';

(B) in paragraph (1)(D), by striking `each deposit insurance fund' and inserting `the Deposit Insurance Fund';

(C) by striking paragraph (4) and redesignating paragraphs (5) through (7) as paragraphs (4) through (6), respectively;

(D) in paragraph (5), as so redesignated--

(i) by striking `any such assessment' and inserting `any such assessment is necessary';

(ii) by striking subparagraph (B);

(iii) in subparagraph (A)--

(I) by striking `(A) is necessary--';

(II) by striking `Bank Insurance Fund members' and inserting `insured depository institutions'; and

(III) by redesignating clauses (i), (ii), and (iii) as subparagraphs (A), (B), and (C), respectively, and moving the margins 2 ems to the left; and

(iv) in subparagraph (C) (as redesignated)--

(I) by inserting `that' before `the Corporation'; and

(II) by striking `; and' and inserting a period; and

(E) in paragraph (6), as so redesignated, by striking `semiannual assessment' and inserting `assessment under subsection (b)';

(10) in section 7(c) (12 U.S.C. 1817(c))--

(A) in paragraph (1), by striking `institution's semiannual assessment' and inserting `assessments for that institution under subsection (b)';

(B) by striking paragraphs (2) and (3); and

(C) by redesignating paragraph (4) as paragraph (2); and

(11) in section 7(j)(7)(F) (12 U.S.C. 1817(j)(7)(F)), by striking `Bank Insurance Fund or the Savings Association Insurance Fund' and inserting `Deposit Insurance Fund';

(12) in section 8 (12 U.S.C. 1818)--

(A) in subsection (p), by striking `semiannual';

(B) in subsection (q), by striking `semiannual' and inserting `assessment'; and

(C) in subsection (t)(2)(C), by striking `deposit insurance fund' and inserting `Deposit Insurance Fund';

(13) in section 11 (12 U.S.C. 1821), by striking `deposit insurance fund' each place that term appears and inserting `Deposit Insurance Fund';

(14) in section 11(f)(1) (12 U.S.C. 1821(f)(1)), by striking `, except that--' and all that follows through the end of the paragraph and inserting a period;

(15) in section 11(i)(3) (12 U.S.C. 1821(i)(3))--

(A) by striking subparagraph (B);

(B) by redesignating subparagraph (C) as subparagraph (B); and

(C) in subparagraph (B) (as redesignated), by striking `subparagraphs (A) and (B)' and inserting `subparagraph (A)';

(16) in section 11(p)(2)(B) (12 U.S.C. 1821(p)(2)(B)), by striking `institution, any' and inserting `institution, the';

(17) in section 12(f)(4)(E)(iv) (12 U.S.C. 1822(f)(4)(E)(iv)), by striking `Federal deposit insurance funds' and inserting `the Deposit Insurance Fund, or any predecessor deposit insurance fund';

(18) in section 13 (12 U.S.C. 1823)--

(A) by striking `deposit insurance fund' each place that term appears and inserting `Deposit Insurance Fund';

(B) in subsection (a)(1), by striking `Bank Insurance Fund, the Savings Association Insurance Fund,' and inserting `Deposit Insurance Fund';

(C) in subsection (c)(4)(E)--

(i) in the subparagraph heading, by striking `FUNDS' and inserting `FUND'; and

(ii) in clause (i), by striking `any insurance fund' and inserting `the Deposit Insurance Fund';

(D) in subsection (c)(4)(G)(ii)--

(i) by striking `appropriate insurance fund' and inserting `Deposit Insurance Fund';

(ii) by striking `the members of the insurance fund (of which such institution is a member)' and inserting `insured depository institutions';

(iii) by striking `each member's' and inserting `each insured depository institution's';

(iv) by striking `the member's' each place that term appears and inserting `the institution's'; and

(v) in subclause (II), by striking `semiannual' and inserting `applicable assessment';

(E) in subsection (c), by striking paragraph (11);

(F) in subsection (h), by striking `Bank Insurance Fund' and inserting `Deposit Insurance Fund';

(G) in subsection (k)(4)(B)(i), by striking `Savings Association Insurance Fund member' and inserting `savings association';

(H) in subsection (k)(5)--

(i) in subparagraph (A), by striking `Savings Association Insurance Fund members' and inserting `savings associations';

(ii) by striking `member's' each place that term appears and inserting `savings association's'; and

(iii) by striking `member' each place that term appears and inserting `savings association';

(19) in section 14(a) (12 U.S.C. 1824(a)), in the 5th sentence--

(A) by striking `Bank Insurance Fund or the Savings Association Insurance Fund' and inserting `Deposit Insurance Fund'; and

(B) by striking `each such fund' and inserting `the Deposit Insurance Fund';

(20) in section 14(b) (12 U.S.C. 1824(b)), by striking `Bank Insurance Fund or Savings Association Insurance Fund' and inserting `Deposit Insurance Fund';

(21) in section 14(c) (12 U.S.C. 1824(c))--

(A) in paragraph (2)(A), by striking `(7)' and inserting `(6)'; and

(B) by striking paragraph (3);

(22) in section 14(d) (12 U.S.C. 1824(d))--

(A) by striking `Bank Insurance Fund member' each place that term appears and inserting `insured depository institution';

(B) by striking `Bank Insurance Fund members' each place that term appears and inserting `insured depository institutions';

(C) by striking `Bank Insurance Fund' each place that term appears (other than in connection with a reference to a Bank Insurance Fund member or members) and inserting `Deposit Insurance Fund';

(D) by striking the subsection heading and inserting the following:

`(d) BORROWING FOR THE DEPOSIT INSURANCE FUND FROM INSURED DEPOSITORY INSTITUTIONS- ';

(E) in paragraph (3), in the paragraph heading, by striking `BIF' and inserting `THE DEPOSIT INSURANCE FUND'; and

(F) in paragraph (5), in the paragraph heading, by striking `BIF MEMBERS' and inserting `INSURED DEPOSITORY INSTITUTIONS';

(23) in section 14 (12 U.S.C. 1824) by adding at the end the following:

`(e) BORROWING FOR THE DEPOSIT INSURANCE FUND FROM FEDERAL HOME LOAN BANKS-

`(1) IN GENERAL- The Corporation may borrow from the Federal home loan banks, with the concurrence of the Federal Housing Finance Board, such funds as the Corporation considers necessary for the use of the Deposit Insurance Fund.

`(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; and

`(C) be a direct liability of the Deposit Insurance Fund.';

(24) in section 15(c)(5) (12 U.S.C. 1825(c)(5))--

(A) by striking `the Bank Insurance Fund or Savings Association Insurance Fund, respectively' each place that term appears and inserting `the Deposit Insurance Fund'; and

(B) in subparagraph (B), by striking `the Bank Insurance Fund or the Savings Association Insurance Fund, respectively' and inserting `the Deposit Insurance Fund';

(25) in section 17(a) (12 U.S.C. 1827(a))--

(A) in the subsection heading, by striking `BIF, SAIF,' and inserting `THE DEPOSIT INSURANCE FUND'; and

(B) in paragraph (1)--

(i) by striking `the Bank Insurance Fund, the Savings Association Insurance Fund,' each place that term appears and inserting `the Deposit Insurance Fund'; and

(ii) in subparagraph (D), by striking `each insurance fund' and inserting `the Fund';

(26) in section 17(d) (12 U.S.C. 1827(d)), by striking `, the Bank Insurance Fund, the Savings Association Insurance Fund,' each place that term appears and inserting `the Deposit Insurance Fund';

(27) in section 18(m) (12 U.S.C. 1828(m))--

(A) in paragraph (2), in the matter preceding subparagraph (A), by striking the colon and inserting a dash;

(B) in paragraph (3)(A)--

(i) by striking `poses a serious threat to the Savings Association Insurance Fund' and inserting `of an insured savings association poses a serious threat to the Deposit Insurance Fund'; and

(ii) by striking `Savings Association Insurance Fund member' and inserting `insured savings association'; and

(C) in paragraph (3)(C), by striking `Savings Association Insurance Fund or the Bank Insurance Fund' and inserting `Deposit Insurance Fund';

(28) in section 18(o) (12 U.S.C. 1828(o)), by striking `deposit insurance funds' and `deposit insurance fund' each place those terms appear and inserting `Deposit Insurance Fund';

(29) in section 18(p) (12 U.S.C. 1828(p)), by striking `deposit insurance funds' and inserting `Deposit Insurance Fund';

(30) in section 24 (12 U.S.C. 1831a)--

(A) in subsections (a)(1) and (d)(1)(A), by striking `appropriate deposit insurance fund' each place that term appears and inserting `Deposit Insurance Fund';

(B) in subsection (e)(2)(A), by striking `risk to' and all that follows through the period and inserting `risk to the Deposit Insurance Fund.'; and

(C) in subsections (e)(2)(B)(ii) and (f)(6)(B), by striking `the insurance fund of

which such bank is a member' each place that term appears and inserting `the Deposit Insurance Fund';

(31) in section 28 (12 U.S.C. 1831e), by striking `affected deposit insurance fund' each place that term appears and inserting `Deposit Insurance Fund';

(32) by striking section 31 (12 U.S.C. 1831h);

(33) in section 36(i)(3) (12 U.S.C. 1831m(i)(3)), by striking `affected deposit insurance fund' and inserting `Deposit Insurance Fund';

(34) in section 37(a)(1)(C) (12 U.S.C. 1831n(a)(1)(C)), by striking `insurance funds' and inserting `Deposit Insurance Fund';

(35) in section 38 (12 U.S.C. 1831o), by striking `the deposit insurance fund' each place that term appears and inserting `the Deposit Insurance Fund';

(36) in section 38(a) (12 U.S.C. 1831o(a)), in the subsection heading, by striking `FUNDS' and inserting `FUND';

(37) in section 38(k) (12 U.S.C. 1831o(k))--

(A) in paragraph (1), by striking `a deposit insurance fund' and inserting `the Deposit Insurance Fund';

(B) in paragraph (2), by striking `A deposit insurance fund' and inserting `The Deposit Insurance Fund'; and

(C) in paragraphs (2)(A) and (3)(B), by striking `the deposit insurance fund's outlays' each place that term appears and inserting `the outlays of the Deposit Insurance Fund'; and

(38) in section 38(o) (12 U.S.C. 1831o(o))--

(A) by striking `ASSOCIATIONS- ' and all that follows through `Subsections (e)(2)' and inserting `ASSOCIATIONS- Subsections (e)(2)';

(B) by redesignating subparagraphs (A), (B), and (C) as paragraphs (1), (2), and (3), respectively, and moving the margins 2 ems to the left; and

(C) in paragraph (1) (as so redesignated), by redesignating clauses (i) and (ii) as subparagraphs (A) and (B), respectively, and moving the margins 2 ems to the left.

SEC. 105. OTHER TECHNICAL AND CONFORMING AMENDMENTS.

(a) SECTION 5136 OF THE REVISED STATUTES- The paragraph designated the `Eleventh' of section 5136 of the Revised Statutes of the United States (12 U.S.C. 24) is amended in the 5th sentence, by striking `affected deposit insurance fund' and inserting `Deposit Insurance Fund'.

(b) INVESTMENTS PROMOTING PUBLIC WELFARE; LIMITATIONS ON AGGREGATE INVESTMENTS- The 23d undesignated paragraph of section 9 of the Federal Reserve Act (12 U.S.C. 338a) is amended in the 4th sentence, by striking `affected deposit insurance fund' and inserting `Deposit Insurance Fund'.

(c) ADVANCES TO CRITICALLY UNDERCAPITALIZED DEPOSITORY INSTITUTIONS- Section 10B(b)(3)(A)(ii) of the Federal Reserve Act (12 U.S.C. 347b(b)(3)(A)(ii)) is amended by striking `any deposit insurance fund in' and inserting `the Deposit Insurance Fund of'.

(d) AMENDMENTS TO THE BALANCED BUDGET AND EMERGENCY DEFICIT CONTROL ACT OF 1985- Section 255(g)(1)(A) of the Balanced Budget and Emergency Deficit Control Act of 1985 (2 U.S.C. 905(g)(1)(A)) is amended--

(1) by striking `Bank Insurance Fund' and inserting `Deposit Insurance Fund'; and

(2) by striking `Federal Deposit Insurance Corporation, Savings Association Insurance Fund;'.

(e) AMENDMENTS TO THE FEDERAL HOME LOAN BANK ACT- The Federal Home Loan Bank Act (12 U.S.C. 1421 et seq.) is amended--

(1) in section 11(k) (12 U.S.C. 1431(k))--

(A) in the subsection heading, by striking `SAIF' and inserting `THE DEPOSIT INSURANCE FUND'; and

(B) by striking `Savings Association Insurance Fund' each place that term appears and inserting `Deposit Insurance Fund';

(2) in section 21 (12 U.S.C. 1441)--

(A) in subsection (f)(2), by striking `, except that' and all that follows through the end of the paragraph and inserting a period; and

(B) in subsection (k), by striking paragraph (4);

(3) in section 21A(b)(4)(B) (12 U.S.C. 1441a(b)(4)(B)), by striking `affected deposit insurance fund' and inserting `Deposit Insurance Fund'; and

(4) in section 21B(k) (12 U.S.C. 1441b(k)) by inserting before the colon `, the following definitions shall apply'.

(f) AMENDMENTS TO THE HOME OWNERS' LOAN ACT- The Home Owners' Loan Act (12 U.S.C. 1461 et seq.) is amended--

(1) in section 5 (12 U.S.C. 1464)--

(A) in subsection (c)(6), by striking `As used in this subsection--' and inserting `For purposes of this subsection, the following definitions shall apply:';

(B) in subsection (o)(1), by striking `that is a Bank Insurance Fund member';

(C) in subsection (o)(2)(A), by striking `a Bank Insurance Fund member until such time as it changes its status to a Savings Association Insurance Fund member' and inserting `insured by the Deposit Insurance Fund';

(D) in subsection (t)(5)(D)(iii)(II), by striking `affected deposit insurance fund' and inserting `Deposit Insurance Fund';

(E) in subsection (t)(7)(C)(i)(I), by striking `affected deposit insurance fund' and inserting `Deposit Insurance Fund'; and

(F) in subsection (v)(2)(A)(i), by striking `the Savings Association Insurance Fund' and inserting `or the Deposit Insurance Fund'; and

(2) in section 10 (12 U.S.C. 1467a)--

(A) in subsection (c)(6)(D), by striking `this title' and inserting `this Act';

(B) in subsection (e)(1)(B), by striking `Savings Association Insurance Fund or Bank Insurance Fund' and inserting `Deposit Insurance Fund';

(C) in subsection (e)(2), by striking `Savings Association Insurance Fund or the Bank Insurance Fund' and inserting `Deposit Insurance Fund';

(D) in subsection (e)(4)(B), by striking `subsection (1)' and inserting `subsection (l)';

(E) in subsection (g)(3)(A), by striking `(5) of this section' and inserting `(5) of this subsection';

(F) in subsection (i), by redesignating paragraph (5) as paragraph (4);

(G) in subsection (m)(3), by striking subparagraph (E), and by redesignating subparagraphs (F), (G), and (H) as subparagraphs (E), (F), and (G), respectively;

(H) in subsection (m)(7)(A), by striking `during period' and inserting `during the period'; and

(I) in subsection (o)(3)(D), by striking `sections 5(s) and (t) of this Act' and inserting `subsections (s) and (t) of section 5'.

(g) AMENDMENTS TO THE NATIONAL HOUSING ACT- The National Housing Act (12 U.S.C. 1701 et seq.) is amended--

(1) in section 317(b)(1)(B) (12 U.S.C. 1723i(b)(1)(B)), by striking `Bank Insurance Fund for banks or through the Savings Association Insurance Fund for savings associations' and inserting `Deposit Insurance Fund'; and

(2) in section 536(b)(1)(B)(ii) (12 U.S.C. 1735f-14(b)(1)(B)(ii)), by striking `Bank Insurance

Fund for banks and through the Savings Association Insurance Fund for savings associations' and inserting `Deposit Insurance Fund'.

(h) AMENDMENTS TO THE FINANCIAL INSTITUTIONS REFORM, RECOVERY, AND ENFORCEMENT ACT OF 1989- The Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1811 note) is amended--

(1) in section 951(b)(3)(B) (12 U.S.C. 1833a(b)(3)(B)), by striking `Bank Insurance Fund, the Savings Association Insurance Fund,' and inserting `Deposit Insurance Fund (or any predecessor deposit insurance fund)'; and

(2) in section 1112(c)(1)(B) (12 U.S.C. 3341(c)(1)(B)), by striking `Bank Insurance Fund, the Savings Association Insurance Fund,' and inserting `Deposit Insurance Fund'.

(i) AMENDMENT TO THE BANK HOLDING COMPANY ACT OF 1956- The Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.) is amended--

(1) in section 2(j)(2) (12 U.S.C. 1841(j)(2)), by striking `Savings Association Insurance Fund' and inserting `Deposit Insurance Fund'; and

(2) in section 3(d)(1)(D)(iii) (12 U.S.C. 1842(d)(1)(D)(iii)), by striking `appropriate deposit insurance fund' and inserting `Deposit Insurance Fund'.

(j) AMENDMENTS TO THE GRAMM-LEACH-BLILEY ACT- Section 114 of the Gramm-Leach-Bliley Act (12 U.S.C. 1828a) is amended by striking `any Federal deposit insurance fund', in subsection (a)(1)(B), paragraphs (2)(B) and (4)(B) of subsection (b), and subsection (c)(1)(B), each place that term appears and inserting `the Deposit Insurance Fund'.

SEC. 106. EFFECTIVE DATE.

This title and the amendments made by this title shall become effective on the first day of the first calendar quarter that begins after the 90-day period beginning on the date of enactment of this Act.

TITLE II--DEPOSIT INSURANCE MODERNIZATION AND IMPROVEMENT

SEC. 201. SHORT TITLE.

This title may be cited as the `Deposit Insurance Reform Act of 2003'.

SEC. 202. INCREASE IN FEDERAL INSURANCE COVERAGE.

(a) INSURED DEPOSITORY INSTITUTIONS-

(1) IN GENERAL- Section 11(a)(1) of the Federal Deposit Insurance Act (12 U.S.C. 1821(a)(1)) is amended--

(A) by striking subparagraph (B) and inserting the following:

`(B) NET AMOUNT OF INSURED DEPOSITS- The net amount of deposit insurance payable to any depositor at an insured depository institution shall not exceed the standard maximum deposit insurance amount, as determined in accordance with paragraph (3) and subparagraphs (C), (D), (E), and (F) of this paragraph.'; and

(B) by striking subparagraph (D) and inserting the following:

`(D) COVERAGE FOR CERTAIN EMPLOYEE BENEFIT PLAN DEPOSITS-

`(i) PASS-THROUGH INSURANCE- The Corporation shall provide pass-through deposit insurance for the deposits of any employee benefit plan.

`(ii) PROHIBITION ON ACCEPTANCE OF BENEFIT PLAN DEPOSITS- An insured depository institution that is not well capitalized or adequately capitalized may not accept employee benefit plan deposits.

`(iii) DEFINITIONS- For purposes of this subparagraph, the following definitions shall apply:

`(I) CAPITAL STANDARDS- The terms `well capitalized' and `adequately capitalized' have the same meanings as in section 38.

`(II) EMPLOYEE BENEFIT PLAN- The term `employee benefit plan' has the same meaning as in paragraph (5)(B)(ii), and includes any eligible deferred compensation plan

described in section 457 of the Internal Revenue Code of 1986.

`(III) PASS-THROUGH DEPOSIT INSURANCE- The term `pass-through deposit insurance' means, with respect to an employee benefit plan, deposit insurance coverage provided on a pro rata basis to the participants in the plan, in accordance with the interest of each participant.

`(E) STANDARD MAXIMUM DEPOSIT INSURANCE AMOUNT DEFINED- For purposes of this paragraph, the term `standard maximum deposit insurance amount' means--

`(i) until the end of the 270-day period beginning on the date of enactment of the Deposit Insurance Reform Act of 2003, $100,000; and

`(ii) after the end of the period referred to in clause (i), $130,000, to be adjusted as provided in subparagraph (F).

`(F) INFLATION ADJUSTMENT-

`(i) IN GENERAL- As of July 1, 2005, and as of the 1st day of each 5-year period thereafter, the standard maximum deposit insurance amount payable to any depositor at an insured depository institution shall be increased by the product of--

`(I) $130,000; and

`(II) the ratio of the value of the Personal Consumption Expenditures Chain-Type Index (or any successor index thereto), published by the Department of Commerce, for December 31 of the year preceding the year in which the adjustment is calculated under this clause, to the value of such index for December 31 of the year preceding the effective date of the Insurance Funds Merger Act of 2003.

`(ii) LIMITATION ON ADJUSTMENTS- If the application of clause (i) would result in any decrease in the standard maximum deposit insurance amount in effect on the date of the adjustment under clause (i), the standard maximum deposit insurance amount shall remain unchanged until the next scheduled 5-year adjustment that does not result in any such decrease.

`(iii) ROUNDING- If the amount determined under clause (ii) for any period is not a multiple of $10,000, the amount so determined shall be rounded to the nearest $10,000.

`(iv) PUBLICATION- Not later than April 1, 2005, and not later than April 1 of the 1st year of each subsequent 5-year period referred to in clause (i), the Board of Directors shall publish in the Federal Register the standard maximum deposit insurance amount and the amount of deposit insurance coverage under paragraph (3)(A) that may be due to any depositor at an insured depository institution during the applicable 5-year period.'.

(2) DEPOSIT INSURANCE FOR RETIREMENT ACCOUNTS- Section 11(a)(3)(A) of the Federal Deposit Insurance Act (12 U.S.C. 1821(a)(3)(A)) is amended--

(A) by striking `$100,000' and inserting `$250,000'; and

(B) by inserting before the period at the end the following: `which amount shall be subject to inflation adjustments in the same manner as under paragraph (1)(F) with respect to the standard maximum deposit insurance amount, except that `$250,000' shall be substituted for the amount specified in clause (i) of paragraph (1)(F) for purposes of this subparagraph'.

(3) DEPOSIT INSURANCE FOR MUNICIPAL DEPOSITS- Section 11(a)(2) of the Federal Deposit Insurance Act (12 U.S.C. 1821(a)(2)) is amended--

(A) in subparagraph (A)--

(i) in the matter following clause (v), by striking `shall be insured in an amount' and all that follows through the period; and

(ii) by striking the semicolon at the end of clause (v) and inserting a period;

(B) by striking `(2)(A) Notwithstanding' and all that follows through `a depositor who is--' and inserting the following:

`(2) MUNICIPAL DEPOSITORS-

`(A) IN GENERAL- Notwithstanding any limitation in this Act or in any other provision of law relating to the amount of deposit insurance available to any one depositor--

`(i) a municipal depositor in a custodial capacity referred to in any of clauses (ii) through (v) of subparagraph (C) shall, for the purpose of determining the amount of insured deposits under this subsection, be deemed to be a depositor in such custodial capacity separate and distinct from any other officer, employee, or agent of the United States or any public unit referred to in any of those clauses (ii) through (v) of subparagraph (C); and

`(ii) the deposits of a municipal depositor shall be insured--

`(I) in an amount equal to the standard maximum deposit insurance amount (as determined under paragraph (1)); or

`(II) only in the case of an in-State municipal depositor, in an amount equal to the lesser of--

`(aa) $5,000,000; or

`(bb) the sum of the standard maximum deposit insurance amount and 80 percent of the amount of any deposits in excess

of the standard maximum deposit insurance amount.

`(B) IN-STATE- In this paragraph, a municipal depositor is an `in-State municipal depositor' if the depositor is located in the same State as the office or branch of the insured depository institution at which the deposits of that depositor are held.

`(C) MUNICIPAL DEPOSITOR- In this paragraph, the term `municipal depositor' means a depositor that is--';

(C) by striking `(B) The' and inserting the following:

`(D) AUTHORITY TO LIMIT DEPOSITS- The'; and

(D) by striking `depositor referred to in subparagraph (A) of this paragraph' each place that term appears and inserting `municipal depositor'.

(4) TECHNICAL AND CONFORMING AMENDMENT RELATING TO INSURANCE OF TRUST FUNDS- Section 7(i) of the Federal Deposit Insurance Act (12 U.S.C. 1817(i)) is amended in each of paragraphs (1) and (3), by striking `$100,000' each place it appears and inserting `the standard maximum deposit insurance amount (as determined under section 11(a)(1))'.

(5) OTHER TECHNICAL AND CONFORMING AMENDMENTS- The Federal Deposit Insurance Act (12 U.S.C. 1811 et seq.) is amended--

(A) in section 11(m)(6) (12 U.S.C. 1821(m)(6)), by striking `$100,000' and inserting `an amount equal to the standard maximum deposit insurance amount (as determined under subsection (a)(1))';

(B) in section 18 (12 U.S.C. 1828), by striking subsection (a) and inserting the following:

`(a) INSURANCE LOGO-

`(1) INSURED DEPOSITORY INSTITUTIONS- Each insured depository institution shall display at each place of business maintained by that institution

a sign or signs relating to the insurance of the deposits of the institution, in accordance with regulations to be prescribed by the Corporation.

`(2) REGULATIONS- The Corporation shall prescribe regulations to carry out this subsection, including regulations governing the substance of signs required by paragraph (1) and the manner of display or use of such signs.

`(3) PENALTIES- For each day that an insured depository institution continues to violate this subsection or any regulation issued under this subsection, it shall be subject to a penalty of not more than $100, which the Corporation may recover for its use.'; and

(C) in section 43(d) (12 U.S.C. 1831t(d)), by striking `$100,000' and inserting `an amount equal to the standard maximum deposit insurance amount (as determined under section 11(a)(1))'.

(b) INSURED CREDIT UNIONS-

(1) IN GENERAL- Section 207(k) of the Federal Credit Union Act (12 U.S.C. 1787(k)) is amended--

(A) by striking `(k)(1)' and all that follows through the end of paragraph (1) and inserting the following:

`(k) INSURED AMOUNTS PAYABLE-

`(1) NET INSURED AMOUNT-

`(A) IN GENERAL- Subject to the provisions of paragraph (2), the net amount of share insurance payable to any member at an insured credit union shall not exceed the total amount of the shares or deposits in the name of the member (after deducting offsets), less any part thereof which is in excess of the standard maximum share insurance amount, as determined in accordance with this paragraph and paragraphs (5) and (6), and consistent with actions taken by the Federal Deposit Insurance Corporation under section 11(a) of the Federal Deposit Insurance Act.

`(B) AGGREGATION- Determination of the net amount of share insurance under subparagraph (A), shall be in accordance with such regulations as the Board may prescribe, and, in determining the amount payable to any member, there shall be added together all accounts in the credit union maintained by that member for that member's own benefit, either in the member's own name or in the names of others.

`(C) AUTHORITY TO DEFINE THE EXTENT OF COVERAGE- The Board may define, with such classifications and exceptions as it may prescribe, the extent of the share insurance coverage provided for member accounts, including member accounts in the name of a minor, in trust, or in joint tenancy.';

(B) in paragraph (2)--

(i) in subparagraph (A)--

(I) in clauses (i) through (v), by moving the margins 4 ems to the left;

(II) in the matter following clause (v), by striking `his account' and all that follows through the period; and

(III) by striking the semicolon at the end of clause (v) and inserting a period;

(ii) by striking `(2)(A) Notwithstanding' and all that follows through `a depositor or member who is--' and inserting the following:

`(2) MUNICIPAL DEPOSITORS OR MEMBERS-

`(A) IN GENERAL- Notwithstanding any limitation in this Act or in any other provision of law relating to the amount of insurance available to any one depositor or member, deposits or shares of a municipal depositor or member shall be insured--

`(i) in an amount equal to the standard maximum share insurance amount (as determined under paragraph (5)); or

`(ii) only in the case of an in-State municipal depositor or member, in an amount equal to the lesser of--

`(I) $5,000,000; or

`(II) the sum of the standard maximum share insurance amount and 80 percent of the amount of any deposits or shares in excess of the standard maximum share insurance amount.

`(B) IN-STATE- In this paragraph, a municipal depositor or member is an `in-State municipal depositor or member' if the depositor or member is located in the same State as the office or branch of the insured credit union at which the deposits or shares of that depositor or member are held.

`(C) MUNICIPAL DEPOSITOR OR MEMBER--In this paragraph, the term `municipal depositor or member' means a depositor or member that is--';

(iii) by striking `(B) The' and inserting the following:

`(D) AUTHORITY TO LIMIT DEPOSITS- The'; and

(iv) by striking `depositor or member referred to in subparagraph (A)' and inserting `municipal depositor or member';

(C) by adding at the end the following:

`(4) COVERAGE FOR CERTAIN EMPLOYEE BENEFIT PLAN DEPOSITS-

`(A) PASS-THROUGH INSURANCE- The Administration shall provide pass-through share insurance for the deposits or shares of any employee benefit plan, subject to subparagraph (B).

`(B) PROHIBITION ON ACCEPTANCE OF DEPOSITS- An insured credit union that is not well capitalized or adequately capitalized may not accept employee benefit plan deposits.

`(C) DEFINITIONS- For purposes of this paragraph, the following definitions shall apply:

`(i) CAPITAL STANDARDS- The terms `well capitalized' and `adequately capitalized' have the same meanings as in section 216(c), as added by section 301 of the Credit Union Membership Access Act (Public Law 105-219, 112 Stat. 931).

`(ii) EMPLOYEE BENEFIT PLAN- The term `employee benefit plan'--

`(I) has the meaning given to such term in section 3(3) of the Employee Retirement Income Security Act of 1974;

`(II) includes any plan described in section 401(d) of the Internal Revenue Code of 1986; and

`(III) includes any eligible deferred compensation plan described in section 457 of the Internal Revenue Code of 1986.

`(iii) PASS-THROUGH SHARE INSURANCE- The term `pass-through share insurance' means, with respect to an employee benefit plan, insurance coverage provided on a pro rata basis to the participants in the plan, in accordance with the interest of each participant.

`(5) STANDARD MAXIMUM SHARE INSURANCE AMOUNT DEFINED- For purposes of this subsection, the term `standard maximum share insurance amount' means--

`(A) until the end of the 270-day period beginning on the date of enactment of the Deposit Insurance Reform Act of 2003, $100,000; and

`(B) after the end of the period referred to in subparagraph (A), $130,000, adjusted as provided in paragraph (6).

`(6) INFLATION ADJUSTMENT-

`(A) IN GENERAL- As of January 1, 2005, and as of the 1st day of each subsequent 5-year period, the standard maximum share insurance amount payable to any member of an insured credit union shall be increased by the product of--

`(i) $130,000; and

`(ii) the ratio of the value of the Personal Consumption Expenditures Chain-Type Index (or any successor index thereto), published by the Department of Commerce, as in effect on the date of the adjustment under this clause.

`(B) LIMITATION ON ADJUSTMENTS- If the application of subparagraph (A) would result in any decrease in the standard maximum share insurance amount in effect on the date of the adjustment under clause (i), the standard maximum share insurance amount shall remain unchanged until the next scheduled 5-year adjustment that does not result in any such decrease.

`(C) ROUNDING- If the amount determined under subparagraph (B) for any period is not a multiple of $10,000, the amount so determined shall be rounded to the nearest $10,000.

`(D) PUBLICATION- Not later than January 31 of the 1st year of each 5-year period referred to in subparagraph (A), the Board shall publish in the Federal Register the standard maximum share insurance amount and the amount of share insurance coverage under paragraph (3) that may be due to any member at an insured credit union during that 5-year period.'; and

(D) in paragraph (3), by striking `$100,000 per account' and inserting the following: `$250,000 per account, which amount shall be subject to inflation adjustments in the same manner as under paragraph (6) with respect to the standard maximum share insurance amount (as determined under paragraph (5), except that `$250,000' shall be substituted for the amount specified in paragraph (5)(A)(i) for purposes of this paragraph).'.

(2) TECHNICAL AMENDMENT- Section 202(h) of the Federal Credit Union Act (12 U.S.C. 1782(h)) is amended by striking `207(c)(1)' and inserting `207(k)'.

(c) EFFECTIVE DATE- This section and the amendments made by this section shall become effective on the effective date of the regulations required under section 205(a)(2), relating to the implementation of deposit insurance increases under this section.

SEC. 203. DESIGNATED RESERVE RATIO.

(a) IN GENERAL-

(1) AMENDMENT TO SECTION 7- Section 7(b)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1817(b)(3)) is amended to read as follows:

`(3) DESIGNATED RESERVE RATIO-

`(A) ACTION BY THE BOARD-

`(i) IN GENERAL- Before the beginning of each calendar year, the Board of Directors shall, subject to clause (ii)--

`(I) designate the reserve ratio applicable to the Deposit Insurance Fund for that year; and

`(II) publish the reserve ratio so designated.

`(ii) RULEMAKING- Any change to the designated reserve ratio for any calendar year shall be made pursuant to section 553 of title 5, United States Code.

`(B) RANGE- The reserve ratio designated by the Board of Directors for any year--

`(i) may not exceed 1.5 percent of aggregate estimated insured deposits; and

`(ii) may not be less than 1.0 percent of aggregate estimated insured deposits.

`(C) FACTORS- In 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 that year and in future years;

`(ii) take into account economic conditions generally affecting insured depository institutions, to provide for an increase in the designated reserve ratio during more favorable economic conditions and to provide for a decrease in the designated reserve ratio 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;

`(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.'.

(2) TECHNICAL AND CONFORMING AMENDMENTS- Section 3(y) of the Federal Deposit Insurance Act (12 U.S.C. 1813) (as amended by this Act) is amended by adding at the end the following:

`(2) RESERVE RATIO- The term `reserve ratio' means the ratio of the fund balance of the Deposit Insurance Fund to aggregate estimated insured deposits held in all insured depository institutions.

`(3) DESIGNATED RESERVE RATIO- The term `designated reserve ratio' means the reserve ratio designated by the Board of Directors under section 7(b)(3).'.

(3) EFFECTIVE DATE- Subject to paragraph (4), this subsection and the amendments made by this subsection shall become effective on the effective date of the regulations required under section 205(a)(1), relating to designation of the reserve ratio by the Board.

(4) DESIGNATION OF INITIAL RESERVE RATIO FOR DEPOSIT INSURANCE FUND- During the period beginning on the effective date of the merger of the deposit insurance funds under section 102, and ending on the effective date of final regulations designating the reserve ratio, as required by section 205(a)(1), the designated reserve ratio of the Deposit Insurance Fund shall continue to be determined pursuant to section 7(b)(2)(A)(iv), as in effect on the day before the effective date of the merger under section 102.

(b) REQUIREMENTS APPLICABLE TO ANY MODIFICATION OF THE RISK-BASED ASSESSMENT SYSTEM- Section 7(b)(1) of the Federal Deposit Insurance Act (12 U.S.C. 1817(b)(1)) is amended by adding at the end the following:

`(E) REQUIREMENTS APPLICABLE TO ANY MODIFICATION OF THE RISK-BASED ASSESSMENT SYSTEM-

`(i) IN GENERAL- In revising or modifying the risk-based assessment system at any time after the date of enactment of the Deposit Insurance Reform Act of 2003, the Board of Directors--

`(I) may not make any change to the information collected from or required to be retained by insured depository institutions solely for purposes of the assessment risk classification, as defined by regulations of the Board, if the change would result in the imposition of an overall greater regulatory or reporting burden on insured depository institutions than was the case before that date of enactment; and

`(II) may implement any such revision or modification in final form only after notice and opportunity for comment.

`(ii) RULE OF CONSTRUCTION- An increase in an assessment rate or a revision of the assessment base shall not be considered to be a revision or modification resulting in greater regulatory or reporting burden for purposes of this subparagraph.'.

SEC. 204. CREDITS BASED ON PAST CONTRIBUTIONS TO DEPOSIT INSURANCE FUND.

(a) IN GENERAL- Section 7(e) of the Federal Deposit Insurance Act (12 U.S.C. 1817(e)) is amended to read as follows:

`(e) REFUNDS AND CREDITS-

`(1) REFUNDS OF OVERPAYMENTS- In 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 semiannual assessments until such credit is exhausted.

`(2) ONE-TIME CREDIT BASED ON TOTAL ASSESSMENT BASE AT YEAR-END 1996-

`(A) IN GENERAL- The Board of Directors shall, by regulation, provide for a credit to each insured depository institution that was in existence on December 31, 1996, and that had paid a deposit insurance assessment prior to

that date (or a successor insured depository institution), based on the assessment base of the institution on that date, as compared to the combined aggregate assessment base of all such institutions, taking into account such factors as the Board may determine to be appropriate.

`(B) CREDIT LIMIT- The aggregate amount of credits available under subparagraph (A) to all insured depository institutions that are eligible for the credit shall not exceed the amount that the Corporation could collect if it imposed an assessment of 9 basis points on the combined assessment base of the Bank Insurance Fund and the Savings Association Insurance Fund as of December 31, 2001.

`(C) APPLICATION OF CREDITS- The amount of a credit to any insured depository institution under this paragraph may be applied by the Corporation to those portions of the assessments under subsection (b) applicable to that institution which become due for assessment periods beginning after the effective date of regulations required by subparagraph (A).

`(D) CHALLENGES TO CREDIT AMOUNTS- The regulations required by subparagraph (A) shall include provisions allowing an insured depository institution a reasonable opportunity to challenge administratively the amount of its credit under this paragraph. The determination of the Corporation of the amount of the credit following such challenge shall be final, and not subject to judicial review.

`(3) ASSESSMENT CREDITS-

`(A) AUTHORITY- The Board of Directors shall, by regulation, establish the qualifications and procedures under which the Corporation would apply assessment credits for the assessment periods beginning on or after the first assessment period to which a credit under paragraph (2) applies.

`(B) CRITERIA FOR DETERMINATION- In determining whether to provide assessment credits under this paragraph and in what amounts, the Board of Directors shall take into account the factors for setting assessments under subsection (b)(2) and the factors for designating the reserve ratio under subsection (b)(3).

`(C) CASH PAYMENTS- The Corporation may, in its sole discretion, elect to provide cash payments in lieu of assessment credits under this paragraph, but only if the reserve ratio of the Deposit Insurance Fund would remain at more than 1.5 percent of aggregate estimated insured deposits after any such payment.'.

(b) EFFECTIVE DATE- The amendments made by this section shall become effective on the effective date of the regulations required to be issued under section 205(a)(3), relating to implementation of the one-time assessment credit.

SEC. 205. REGULATIONS REQUIRED.

(a) IN GENERAL- Not later than 270 days after the date of enactment of this Act, the Board shall issue final regulations, in accordance with section 553 of chapter 5 of title 5, United States Code--

(1) designating the reserve ratio for the Deposit Insurance Fund in accordance with section 7(b)(3) of the Federal Deposit Insurance Act, as amended by section 203 of this Act, which regulations shall become effective not later than 90 days after the date of their publication in final form;

(2) implementing increases in deposit insurance coverage in accordance with the amendments made by section 202, which regulations shall become effective not later than 90 days after the date of their publication in final form;

(3) implementing the one-time assessment credit to certain insured depository institutions in accordance with section 7(e)(2) of the Federal Deposit Insurance Act, as amended by section 204 of this Act;

(4) establishing the qualifications and procedures under which the Corporation would apply assessment credits, as required by section 7(e)(3) of the Federal Deposit Insurance Act, as amended by section 204 of this Act; and

(5) providing for assessments under section 7 of the Federal Deposit Insurance Act, as amended by

this Act, which regulations shall become effective on the effective date of the regulations required by paragraph (3).

(b) SAVINGS CLAUSE-

(1) IN GENERAL- Nothing in this Act or the amendments made by this Act shall be construed to affect the authority of the Corporation with regard to the setting or collection of deposit insurance assessments prior to the effective date of any regulations required under subsection (a).

(2) PRESERVATION OF MINIMUM ASSESSMENT PROVISION- Subparagraph (E) of section 7(b)(2) of the Federal Deposit Insurance Act (12 U.S.C. 1817(b)(2)), as in effect on the day before the effective date of title I of this Act, shall continue to apply with respect to deposit insurance assessments imposed prior to the effective date of the regulations required under subsection (a)(5) of this section.

SEC. 206. STUDIES OF POTENTIAL CHANGES TO THE FEDERAL DEPOSIT INSURANCE SYSTEM.

(a) STUDY AND REPORT BY FDIC AND NCUA-

(1) STUDY- The Board of Directors of the Federal Deposit Insurance Corporation and the National Credit Union Administration Board shall each conduct a study of--

(A) the feasibility of increasing the limit on deposit insurance for deposits of municipalities and other units of general local government, and the potential benefits and the potential adverse consequences that may result from any such increase; and

(B) the feasibility of establishing a voluntary deposit insurance system for deposits in excess of the maximum amount of deposit insurance for any depositor, and the potential benefits and the potential adverse consequences that may result from the establishment of any such system.

(2) REPORT- Not later than 1 year after the date of enactment of this Act, the Board of Directors of the Federal Deposit Insurance Corporation and the National Credit Union Administration Board shall each submit a report to the Congress on the study required under paragraph (1), containing the findings and conclusions of the reporting agency, together with such recommendations for legislative or administrative changes as the agency may determine to be appropriate.

(b) STUDY AND REPORT REGARDING APPROPRIATE RESERVE RATIO-

(1) STUDY- The Corporation shall conduct a study on the feasibility of using actual deposits rather than estimated insured deposits in calculating the reserve ratio of the Deposit Insurance Fund.

(2) REPORT- Not later than 1 year after the date of enactment of this Act, the Board shall submit a report to Congress on the results of the study required under paragraph (1), together with such recommendations for legislative or administrative actions as may be determined to be appropriate.

SEC. 207. EFFECTIVE DATE.

Except as otherwise specifically provided in this title, this title and the amendments made by this title shall become effective on the date of enactment of this Act.

END