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Page:United States Statutes at Large Volume 101 Part 1.djvu/604

 101 STAT. 574 Armed Forces.

PUBLIC LAW 100-86—AUG. 10, 1987 "(ii) at least 90 percent of the customers of the savings and loan holding company and its subsidiaries and affiliates are active or former officers in the United States military services or the widows, widowers, divorced spouses, or current or former dependents of such officers.". (2) TECHNICAL AMENDMENT.—Section 408(d) of the National Housing Act (12 U.S.C. 1730a(d)) is amended by striking out "No savings and loan" and inserting in lieu thereof "Except as provided in subsection (p), no savings and loan". (e) TYING RESTRICTIONS.—Section 408 of the National Housing Act

(12 U.S.C. 1730a) is amended by inserting after subsection (p) (as added by subsection (d) of this section) the following new subsection: "(q) TYING RESTRICTIONS.— "(1) STATE CHARTERED INSURED INSTITUTION SUBSIDIARIES.—A

State chartered insured institution subsidiary of a savings and loan holding company shall be subject to section 5(q) of the Home Owners' Loan Act of 1933, and regulations prescribed under such subsection, in the same manner and to the same extent as an association (as defined in section 2(d) of such Act). "(2) HOLDING COMPANIES AND CERTAIN AFFILIATES.—A savings and loan holding company and any of its affiliates (other than an insured institution) shall be subject to section 5(q) of the Home Owners' Loan Act of 1933, and regulations prescribed under such subsection, in connection with transactions involving the products or services of such company or affiliate and those of an affiliated insured institution as if such company or affiliate were an association (as defined in section 2(d) of such Act).".

12 USC 1464. 12 USC 1462.

' ' •'

(f) SAVINGS BANK AS INSURED INSTITUTION.—

(1) IN GENERAL.—Section 408(n) of the National Housing Act (12 U.S.C. 1730a) is amended to read as follows: "(n) TREATMENT OF F D I C INSURED STATE SAVINGS BANKS AND COOPERATIVE BANKS AS INSURED INSTITUTIONS.—

Ante, p. 563.

1 ^ il-f '^

"(1) IN GENERAL.—Notwithstanding any other provision of law, a savings bank (as defined in section 3(g) of the Federal Deposit Insurance Act) and a cooperative bank that is an insured bank (as defined in section 3(h) of the Federal Deposit Insurance Act) upon application shall be deemed to be an insured institution for the purpose of this section, if the Corporation determines that such bank is a qualified thrift lender (as determined under subsection (o)). "(2) FAILURE TO MAINTAIN QTL STATUS.—If any savings bank which is deemed to be an insured institution under paragraph (1) subsequently fails to maintain its status as a qualified thrift lender, as determined by the Corporation, such bank may not thereafter be a qualified thrift lender for a period of 5 years.". (2)

12 USC 1730a.

TECHNICAL

AND

CONFORMING

AMENDMENT.—Section

408(a)(1)(A) of the National Housing Act (12 U.S.C. 1730a(a)(l)(A)) is amended by adding before the semicolon at the end thereof the following: "and a savings bank which is deemed by the Corporation to be an insured institution under subsection (n)". (g) THRIFT ACQUISITIONS.—Section 408(e)(3) of the National Housing Act (12 U.S.C. 1730(e)) is amended to read as follows: "(3) INTERSTATE ACQUISITIONS.—No acquisition shall be approved by the Corporation under this subsection which will result in the

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Page:United States Statutes at Large Volume 101 Part 1.djvu/605

 PUBLIC LAW 100-86—AUG. 10, 1987

101 STAT. 575

formation by any company, through one or more subsidiaries or through one or more transactions, of a multiple savings and loan holding company controlling insured institutions in more than one State, unless— "(A) such company, or an insured institution subsidiary of such company, is authorized to acquire control of an insured institution subsidiary, or to operate a home or branch office, in the additional State or States pursuant to subsection (m); "(B) such company controls an insured institution subsidiary which operated a home or branch office in the additional State or States as of March 5, 1987; or "(C) the statute laws of the State in which the insured institution, control of which is to be acquired, is located are such that an insured institution chartered by such State could be acquired by an insured institution chartered by the State where the acquiring insured institution or savings and loan holding company is located (or by a holding company that controls such a State-chartered insured institution), and such statute laws specifically authorize such an acquisition by language to that effect and not merely by implication.". (h) EMERGENCY ACQUISITIONS.—Section 408(m)(l)(A)(i) of the National Housing Act (12 U.S.C. 1730a(m)(l)(A)(i)) is amended by inserting "(c)," before "(e)(2)".

.. ... ^

SEC. 105. AMENDMENT TO THE FEDERAL HOME LOAN BANK ACT.

Section 10 of the Federal Home Loan Bank Act (12 U.S.C. 1430) is amended by adding at the end thereof the following: "(e) REDUCED ELIGIBILITY FOR ADVANCES FOR CERTAIN MEMBERS WHICH ARE NOT QUALIFIED THRIFT LENDERS.—

J

"(1) IN GENERAL.—Except as the Board may prescribe, a member that is not a qualified thrift lender may not receive advances in excess of the amount determined by multiplying— "(A) the total amount of advances that such member would be eligible to receive in the absence of this subsection; by "(B) such member's actual thrift investment percentage, "(2) EXCEPTIONS.—Paragraph (1) does not apply to— "(A) a savings bank as defined in section 3(g) of the Federal Deposit Insurance Act; "(B) an insured institution which was chartered prior to October 15, 1982, as a savings bank under State law; or "(C) an insured institution which acquired its principal assets from an institution which was chartered prior to October 15, 1982, as a savings bank under State law. "(3) DEFINITIONS.—As used in this subsection— "(A) INSURED INSTITUTION.—The term 'insured institution' has the same meaning as in section 408(a)(1)(A) of the National Housing Act. "(B) QUALIFIED THRIFT LENDER.—The term 'qualified thrift lender' has the same meaning as in section 408(o) of the National Housing Act. "(C) ACTUAL THRIFT INVESTMENT PERCENTAGE.—The term 'actual thrift investment percentage' has the same meaning as in section 408(o)(5)(A) of the National Housing Act.".

Post, p. 601. >

^

Ante, p. 563.

'Ante, p. 594. Ante, p. 571.

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license: Creative Commons - Attribution Share-Alike - https://creativecommons.org/licenses/by-sa/4.0/


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Page:United States Statutes at Large Volume 101 Part 1.djvu/606

 101 STAT. 576

PUBLIC LAW 100-86—AUG. 10, 1987

SEC. 106. SECURITIES AFFILIATIONS OF FSLIC INSURED INSTITUTIONS.

(a) IN GENERAL.—Section 408 of the National Housing Act (12 U.S.C. 1730a) is amended by inserting after subsection (q) (as added by section 104(e) of this title) the following new subsection: "(r) SECURITIES AFFIUATIONS.— 12 USC 377. 12 USC 78.

Washington.

Ante, p. 566. Minnesota.

"(1) IN GENERAL.—The provisions of section 20 of the Banking Act of 1933 (relating to affiliations between member banks and organizations engaged principally in certain securities activities) and the provisions of section 32 of the Banking Act of 1933 (relating to certain officer, director, or employee relationships involving a member bank and a person or organization primarily engaged in certain securities activities) shall be applicable to every insured institution in the same manner and to the same extent as if such insured institution were a member bank. "(2) EXCEPTIONS.—This subsection does not prohibit— "(A) the continuation of such an affiliation or relationship which commenced prior to March 5, 1987, or the .' establishment of such an officer, director, or employee relationship in connection with any affiliation established before such date; "(B) the Washington Mutual Savings Bank, located in the State of Washington, from acquiring control of one or more insured institutions or establishing an officer, director, or employee relationship between such an insured institution <'i ''• and any affiliate of the savings bank referred to in section 18(j)(3)(B) of the Federal Deposit Insurance Act; p.a3P "(C) the acquisition of Peoples Savings and Loan Association of Owatonna, Minnesota, by Miller and Schroeder Holdings, Inc. (or any affiliate of such company), or the establishment of any officer, director, or employee relationship between such association and such company or any affiliate of such company, including Miller and Schroeder < J2 Financial, Inc.; or "(D) such an affiliation or officer, director, or employee ^g,:^^ relationship which results from the acquisition by an organization described in paragraph (1) of an insured ,, i f institution under subsection (m) of this section, if such institution has total assets of $500,000,000 or more at the .y time of such acquisition. "(3) TWO-YEAR PERIOD.—An affiliation or an officer, director, or employee relationship that becomes unlawful as a result of the enactment of this subsection may continue for a period of 2 years after the date of the enactment of this subsection. "(4) EXEMPT ACTIVITIES OF CERTAIN INSTITUTIONS.—Nothing in

Real property.

.R'.'

.ji'

this subsection or section 18(j)(3) of the Federal Deposit Insurance Act prohibits an affiliation or an officer, director, or employee relationship between an insured institution or an institution which is eligible to become a member of a Federal Home Loan Bank, and an organization engaged principally in the issuance, sale, underwriting, or distribution, at wholesale or retail, or through syndicate participation, of— «^^) securities representing or secured by interests in real estate or real estate loans or pools of real estate loans; "(B) interests in partnerships formed primarily to own, operate, manage, or invest in real estate;

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text: Dictionary of National Biography, 1885-1900/Patterson, John Brown


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Page:United States Statutes at Large Volume 101 Part 1.djvu/607

 PUBLIC LAW 100-86—AUG. 10, 1987

i. i.

101 STAT. 577

"(C) insurance products deemed to be securities, including without limitation variable annuities and variable life insurance; "(D) securities of an investment company, as such term is defined in the Investment Company Act of 1940; and "(E) any securities to the extent such issuance, sale, underwriting, or distribution is permitted for national banks.

15 USC 80a-l.

"(5) REGULATIONS.—

•i' •

"(A) IN GENERAL.—The Corporation is authorized to issue rules and regulations and to publish interpretations governing the implementation of this subsection, and shall enforce the provisions of this subsection. "(B) FEDERAL DEPOSIT INSURANCE CORPORATION AUTHOR-

^' '

ITY.—For the purpose of paragraph (4), the Federal Deposit Insurance Corporation is authorized to issue rules and regulations and publish interpretations with respect to savings banks and other institutions subject to section 18(j)(3) of the Federal Deposit Insurance Act.". Ante, p. 566. (b) EXPIRATION DATE.—The amendment made by subsection (a) 12 USC I730a shall cease to be effective on March 1, 1988. note. SEC. 107. MUTUAL HOLDING COMPANY AMENDMENTS.

(a) IN GENERAL.—Section 408 of the National Housing Act (12 U.S.C. 1730a) is amended by inserting after subsection (r) (as added by section 106(a) of this title) the following new subsection:

"(s) MUTUAL HOLDING COMPANIES.—

"(1) IN GENERAL.—Notwithstanding any provision of Federal law other than this title, an insured institution operating in mutual form may reorganize so as to become a holding company by— "(A) chartering an interim savings institution, the stock of which is to be wholly owned by the mutual institution; and "(B) transferring the substantial part of its assets and liabilities, including all of its insured liabilities, to the interim savings institution. "(2) DIRECTORS AND CERTAIN ACCOUNT HOLDERS' APPROVAL OF

PLAN REQUIRED.—A reorganization is not authorized under this subsection unless— "(A) a plan providing for such reorganization has been approved by a majority of the board of directors of the mutual savings institution; and "(B) in the case of an institution in which holders of » accounts and obligors exercise voting rights, such plan has been submitted to and approved by a majority of such individuals at a meeting held at the call of the directors in accordance with the procedures prescribed by the institution's charter and bylaws. "(3) NOTICE TO THE CORPORATION; DISAPPROVAL PERIOD.— "(A) NOTICE REQUIRED.—At least 60 days prior to taking

any action described in paragraph (1), an insured institution seeking to establish a mutual holding company shall provide written notice to the Corporation. The notice shall contain such relevant information as the Corporation shall require by regulation or by specific request in connection with any particular notice.

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Page:United States Statutes at Large Volume 101 Part 1.djvu/608

 101 STAT. 578

PUBLIC LAW 100-86—AUG. 10, 1987 "(B) TRANSACTION ALLOWED IF NOT DISAPPROVED.—Unless

vf

12 USC 1726.

12 USC 1464.

it

the Corporation within such 60-day notice period disapproves the proposed holding company formation, or extends for another 30 days the period during which such disapproval may be issued, the insured institution providing such notice may proceed with the transaction, if the requirements of paragraph (2) have been met. "(C) GROUNDS FOR DISAPPROVAL.—The Corporation may disapprove any proposed holding company formation only i^"(i) such disapproval is necessary to prevent unsafe or unsound practices; "(ii) the financial or management resources of the insured institution involved warrant disapproval; "(iii) the insured institution fails to furnish the information required under subparagraph (A); or "(iv) the insured institution fails to comply with the, requirement of paragraph (2). "(D) RETENTION OF CAPITAL ASSETS.—In connection with the transaction described in paragraph (1), an insured institution may, subject to the approval of the Corporation, retain capital assets at the holding company level to the extent that such capital exceeds adequate reserves as prescribed pursuant to section 403(b) or the comparable provisions of State or Federal law. "(4) OWNERSHIP.—Persons having ownership rights in the mutual institution pursuant to section 5G3)(1)(B) of the Home Owners' Loan Act of 1933 or State law shall have the same ownership rights with respect to the mutual holding company. "(5) PERMITTED ACTIVITIES.—A mutual holding company may engage only in the following activities: "(A) Investing in the stock of an insured institution. "(B) Acquiring a mutual institution through the merger of such institution into an insured institution subsidiary of such holding company or an interim savings institution subsidiary of such holding company. "(C) Subject to paragraph (6), merging with or acquiring another holding company, one of whose subsidiaries is an insured institution. "(D) Investing in a corporation the capital stock of which is available for purchase by an insured institution under Federal law or under the law of any State where the subsidiary insured institution or institutions have their home offices. "(E) Engaging in the activities described in subsection (c)(2), except subparagraph (B). "(6) LIMITATIONS ON CERTAIN ACTIVITIES OF ACQUIRED HOLDING COMPANIES.—

"(A) NEW ACTIVITIES.—If a mutual holding company acquires or merges with another holding company under paragraph (5)(C), the holding company acquired or the holding company resulting from such merger or acquisition may only invest in assets and engage in activities which are authorized under paragraph (5). "(B) GRACE PERIOD FOR DIVESTING PROHIBITED ASSETS OR DISCONTINUING PROHIBITED ACTIVITIES.—Not later than 2

years following a merger or acquisition described in para-

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text: Dictionary of National Biography, 1885-1900/Patterson, Robert (1802-1872)


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Page:United States Statutes at Large Volume 101 Part 1.djvu/609

 PUBLIC LAW 100-86—AUG. 10, 1987

101 STAT. 579

graph (5)(C), the acquired holding company or the holding company resulting from such merger or acquisition shall— "(i) dispose of any asset which is an asset in which a mutual holding company may not invest under paragraph (5); and "(ii) cease any activity which is an activity in which a mutual holding company may not engage under paragraph (5). "(7) REGULATION.—Unless the context otherwise requires, a mutual holding company shall be subject to the other requirements of this section regarding regulation of holding companies. "(8) DEFINITIONS.—For purposes of this subsection— "(A) MUTUAL HOLDING COMPANY.—The term 'mutual holding company' means a corporation organized as a holding company under this subsection. "(B) MUTUAL INSTITUTION.—The term 'mutual institution' means— "(i) an insured institution; or "(ii) a savings bank (as defined in section 3(g) of the Federal Deposit Insurance Act), which is operating in mutual form.",

 * >t:j J:

Ante, p. 563.

(b) AMENDMENT TO THE BANK HOLDING COMPANY ACT.—Section 3

of the Bank Holding Company Act of 1956 (12 U.S.C. 1842) is amended by adding at the end thereof the following:

Ante, p. 561.

"(g) MUTUAL BANK HOLDING COMPANY.—

"(1) ESTABLISHMENT.—Notwithstanding any provision of Federal law other than this Act, a savings bank or cooperative bank operating in mutual form may reorganize so as to form a holding company. "(2) REGULATION.—A corporation organized as a holding company under this subsection shall be regulated on the same terms and be subject to the same limitations as any other holding company which controls a savings bank.". SEC. 108. LEASING AUTHORITY OF NATIONAL BANKS.

Section 5136 of the Revised Statutes (12 U.S.C. 24) is amended by adding at the end thereof the following: "Tenth. To invest in tangible personal property, including, without limitation, vehicles, manufactured homes, machinery, equipment, or furniture, for lease financing transactions on a net lease basis, but such investment may not exceed 10 percent of the assets of the association.".

Real property.

SEC.109. NOW ACCOUNTS.

Section 2(a)(2) of Public Law 93-100 (12 U.S.C. 1832(a)(2)) is amended by inserting the term "political," immediately after "educational,". SEC. 110. EXEMPTION FROM AFFILIATE TRANSACTION RESTRICTIONS.

Section 408 of the National Housing Act (12 U.S.C. 1730a) is amended by inserting after subsection (s) (as added by section 107(a) of this title) the following new subsection: "(t) EXEMPTION.—

"(1) IN GENERAL.—Subject to paragraph (2), but notwithstanding any other provision of law, an insured institution that is a subsidiary of an insured institution or insured institutions the

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Page:United States Statutes at Large Volume 101 Part 1.djvu/610

 101 STAT. 580

PUBLIC LAW 100-86—AUG. 10, 1987

voting stock of which is 80 percent owned by the same company shall not be subject— "(A) to the provisions of subsection (d) of this section as to transactions with such parent insured institution or aifiliate insured institutions (and their subsidiaries), or "(B) to the provisions of subsections (f) and (g). "(2) Low QUAUTY ASSETS.—An insured institution (or its subsidiary) may not purchase a low quality asset, as such term 12 USC 371c. is defined in section 23A of the Federal Reserve Act, from another insured institution (or its subsidiary) in a transaction exempted by this subsection and any transaction with another insured institution (or its subsidiary) under this subsection shall be on terms and conditions that are consistent with safe and sound financial practices. "(3) DEFINITION.—For purposes of this subsection, an 'insured r.^ institution' includes an institution that was chartered prior to October 15, 1982, as a savings bank or cooperative bank under State law and that is or becomes a savings and loan holding ^ company or is or becomes a subsidiary of a savings and loan sm ^.v, i ri^ holding company.".

Ante, p. 574.

26 USC 382.

SEC. 111. CONSIDERATION OF CERTAIN ACQUISITIONS. (a) AMENDMENT TO SECTION 408.—Section 408(e) of the National Housing Act (12 U.S.C. 1730a(e)) is amended— (1) by redesignating paragraph (4) as paragraph (5); (2) by inserting a new paragraph (4) to read as follows: "(4) CONSIDERATION OF LOSS OF CERTAIN TAX BENEFITS.— "(A) IN GENERAL.—In each case in which a filing of any type is required by this section, or regulations prescribed under this section, before the acquisition of stock of an insured institution, the Corporation, in evaluating such filing, may consider the likelihood that the proposed acquisition will result in the loss or reduction of the tax benefits of the insured institution's net operating loss carryforwards under section 382 of the Internal Revenue . 5,; f. Code of 1986.

100 Stat. 2095.

..a';,

"(g) REQUIRED CONSIDERATION IN CERTAIN CASES.—The

u3.i

Post, p. 613.

g| -L'i

Corporation shall, with respect to any acquisition, give consideration to the likelihood of future loss or reduction of the tax benefits of an insured institution's net operating loss carryforwards under section 382 of the Internal Revenue Code of 1986 if such net operating loss carryforwards result from the insured institution's acquisition of one or more insured institutions under subsection (m) of this sec» tion or section 406(f) or pursuant to acquisitions that are otherwise deemed to be supervisory cases by the Corporation. "(C) PERMITTED TRANSACTIONS.—Notwithstanding subparagraph (A) or (B), the Corporation may permit— "(i) acquisitions in which the proposed acquirer commits itself in writing to maintain the ratio of tangible equity capital to liabilities of the insured institution to be acquired, as determined in accordance with generally accepted accounting principles, in an amount equal to the ratio in existence at the time of filing with the Corporation,

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Page:United States Statutes at Large Volume 101 Part 1.djvu/611

 PUBLIC LAW 100-86—AUG. 10, 1987

101 STAT. 581

"(ii) acquisitions which are approved by the holders of a majority of the voting stock of the institution to be acquired, or "(iii) acquisitions pursuant to subsection (m) of this section or section 406(f) or pursuant to acquisitions that Post, p. 613. are otherwise deemed to be supervisory cases by the Corporation.", (b) AMENDMENT TO SECTION 407.—Section 407(q) of the National Housing Act (12 U.S.C. 1730(q)) is amended— (1) by redesignating paragraphs (8) through (18) as paragraphs (9) through (19), respectively; (2) by inserting a new paragraph (8) to read as follows: "(8) CONSIDERATION OF LOSS OP CERTAIN TAX BENEFITS.—

"(A) IN GENERAL.—In each case in which a filing of any type is made under this subsection, or regulations prescribed under this section, before the acquisition of stock of an insured institution, the Corporation, in evaluating such filing, may consider the likelihood that the proposed acquisition will result in the loss or reduction of the tax benefits of an insured institution's net operating loss carryforwards under section 382 of the Internal Revenue Code of 1986. 26 USC 382. xr _j "(B) REQUIRED CONSIDERATION IN CERTAIN CASES.—The l O Stat. 2095. O Corporation shall, with respect to any acquisition, give -n consideration to the likelihood of future loss or reduction of the tax benefits of an insured institution's net operating loss carryforwards under section 382 of the Internal Revenue Code of 1986 if such net operating loss carry forwards result from the insured institution's acquisition of one or more insured institutions under section 406(f) or 408(m) or 12 USC I730a. pursuant to acquisitions that are otherwise deemed to be supervisory cases by the Corporation. '(C) PERMITTED TRANSACTIONS.—Notwithstanding subparagraph (A) or (B), the Corporation may permit— "(i) acquisitions in which the proposed acquirer commits itself in writing to maintain the ratio of tangible equity capital to liabilities of the insured institutions to be acquired, as determined in accordance with generally accepted accounting principles, in an amount equal to the ratio in existence at the time of filing with the Corporation, "(ii) acquisitions which are approved by the holders of a majority of the voting stock of the institution to be acquired, or (iii) acquisitions under section 406(f) or 408(m), or are acquisitions that are otherwise deemed to be supervisory cases by the Corporation.".

TITLE II—MORATORIUM ON CERTAIN NONBANKING ACTIVITIES SEC. 20L MORATORIUM ON CERTAIN NONBANKING ACTIVITIES.

12 USC 1841

(a) APPLICABILITY.—The provisions of this section shall apply "°*® during the period beginning on March 6, 1987, and ending on March 1, 1988.

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Page:United States Statutes at Large Volume 101 Part 1.djvu/612

 101 STAT. 582

PUBLIC LAW 100-86—AUG. 10, 1987

 * (b) MORATORIUM.—

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(1) A foreign bank or other company covered by subsection (c) of section 8 of the International Banking Act of 1978 (12 U.S.C. 3106(c)) shall not, under any provision of law which is not applicable to domestic bank holding companies, expand any activity in which it is engaged pursuant to that subsection by acquiring an interest in, or the assets of, a going concern. This paragraph shall not apply to any "domestically-controlled affiliate covered in 1978" as defined in that subsection. (2) A Federal banking agency may not authorize or allow by action, inaction, or otherwise any bank holding company or subsidiary or affiliate thereof, any foreign bank or other company subject to the Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.) under section 8(a) of the International Banking Act of 1978 (12 U.S.C. 3106(a)), or any insured bank or subsidiary or affiliate thereof to engage in the United States to any extent whatever— (A) in the flotation, underwriting, public sale, dealing in, or distribution of securities if that approval would require the agency to determine that the entity which would conduct such activities would not be engeiged principally in such activities, (B) in any securities activity not legally authorized in writing prior to March 5, 1987, or (C) in the operation of a nondealer marketplace in options. Subparagraph (B) shall not affect (i) activities in which any bank holding company or subsidiary or affiliate thereof, any foreign bank or other company subject to the Bank Holding Company Act of 1956 under section 8(a) of the International Banking Act of 1978, or any insured bank or subsidiary or affiliate thereof acts only as an agent; (ii) activities which had been lawfully engaged in prior to March 5, 1987; or (iii) sales or transactions closed on or before June 30, 1987. (3) A Federal banking agency may not issue any rule, regulation, or order that would have the effect of increasing the insurance powers of banks, bank holding companies, foreign banks or other companies subject to the Bank Holding Company Act of 1956 under section 8(a) of the International Banking Act of 1978, or banking or nonbanking subsidiaries thereof with respect to any activities in the United States, either with respect to specific banks or bank holding companies or subsidiaries thereof or generally beyond those expressly authorized for bank holding companies under subparagraphs (A) through (G) of section 4(c)(8) of the Bank Holding Company Act of 1956 (12 U.S.C. 1843(c)(8)(A) through (G)). (4) Except as provided in section 3(f) of the Bank Holding Company Act of 1956 (12 U.S.C. 1842(f)), as added by section 101(d) of this Act, the Board of Governors of the Federal Reserve System may not approve the acquisition by a bank holding company or by a foreign bank or other company subject to the Bank Holding Company Act of 1956 under section 8(a) of the International Banking Act of 1978, of any company, including a State-chartered bank, unless the bank holding company, foreign bank, or other company has agreed to limit the insurance activities in the United States of the company to be acquired to

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Page:United States Statutes at Large Volume 101 Part 1.djvu/613

 PUBLIC LAW 100-86—AUG. 10, 1987 those permissible under section 4(c)(8) of the Bank Holding Company Act of 1956. This paragraph shall not apply to the acquisition of a State-chartered bank that upon acquisition would be subject to the Bank Holding Company Act of 1956, pursuant to a reorganization plan under which the stockholders of the bank exchange their shares for shares in a newly created bank holding company which is not a subsidiary of any other company or to the acquisition of a State-chartered bank by a bank holding company that on March 6, 1987, controlled one or more State-chartered banks that have engaged in insurance activities identical to those of the newly acquired institution so long as the bank holding company agrees that it will— (A) within 2 years of the consummation of its acquisition of the State-chartered bank, divest or terminate that bank's impermissible insurance activities, and (B) limit the bank's insurance activities during that 2year period to the renewal of existing policies. (5) A national bank or a Federal branch or agency of a foreign bank may not expand its insurance agency activities pursuant to the Act of September 7, 1916 (12 U.S.C. 92), into places where it was not conducting such activities as of March 5, 1987. (6) A Federal banking agency may not issue any rule, regulation, or order that would have the effect of increasing real estate powers in the United States of banks, bank holding companies, foreign banks or other companies subject to the Bank Holding Company Act of 1956 under section 8(a) of the International Banking Act of 1978, or of any banking or nonbanking subsidiaries of any such banks or companies. (c) DEFINITIONS.—As used in this section and section 202— (1) the term "affiliate" has the same meaning as in section 2(j)(2) of the Bank Holding Company Act of 1956 (12 U.S.C. 1841(j)(2)), as added by section 101(a) of this Act; (2) the term "bank holding company" has the same meaning as in section 2(a) of the Bank Holding Company Act of 1956 (12 U.S.C. 1841(a)); (3) the term "Federal banking agency" has the same meaning as the term "appropriate Federal banking agency" has in section 3(q) of the Federal Deposit Insurance Act (12 U.S.C. 1813(q)); and (4) the term "insured bank" has the same meaning as in section 3(h) of the Federal Deposit Insurance Act (12 U.S.C. 1813(h)). (d) INSURANCE AUTHORITY OF BANKING ORGANIZATIONS.—Nothing

in this section may be construed to increase or reduce the insurance authority of bank holding companies or banking or nonbanking subsidiaries thereof or of national banks under current law. (e) INSURANCE AUTHORITY OF CERTAIN STATE-CHARTERED BANKS.— (1) FREESTANDING STATE-CHARTERED BANKS.—Nothing in this

section shall be construed to deny any State the authority to permit its State-chartered banks that are not controlled by bank holding companies from engaging in any insurance activity. (2) STATE-CHARTERED SUBSIDIARIES OF BANK HOLDING COMPA-

NIES.—In addition, neither the existence of the moratorium nor its expiration shall be construed to increase, decrease, or affect in any way the authority of State-chartered bank subsidiaries of bank holding companies with respect to insurance activities.

101 STAT. 583 12 USC 1843.

i

12 USC 1841 ^* ^ c ° vV

12 USC 3106.

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Page:United States Statutes at Large Volume 101 Part 1.djvu/614

 101 STAT. 584 12 USC 1841

PUBLIC LAW 100-86—AUG. 10, 1987

SEC. 202. AUTHORITY OF FEDERAL BANKING AGENCIES.

Nothing in section 201 may be construed to prevent a Federal banking agency from issuing any rule, regulation, or order pursuant to its legal authority in existence on the day preceding the date of enactment of this Act to expand the securities, insurance, or real estate powers of banks or bank holding companies that are subject to the moratorium established under section 201 if the effective date of such rule, regulation, or order is delayed until the expiration of such moratorium. 12 USC 1841
 * F >

SEC. 203. INTENT OF CONGRESS. (a) COMPREHENSIVE CONGRESSIONAL REVIEW OF BANKING AND FINANCIAL LAWS.—It is the intent of the Congress, through the

Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Banking, Finance and Urban Affairs of the House of Representatives, to conduct a comprehensive review of our banking and financial laws and to make decisions on the need for financial restructuring legislation in the light of today's changing financial environment both domestic and international before the expiration of such moratorium. (b) CONGRESSIONAL INTENT NOT TO RENEW OR EXTEND MORATO-

RIUM.—It is the intent of the Congress not to renew or extend the moratorium established under section 201 whether or not subsequent banking legislation is passed by the Congress. SEC. 204. AMENDMENTS TO THE INTERNATIONAL BANKING ACT OF 1978. (a) TERMINATION OF CERTAIN NONBANKING ACTIVITIES.—Section

,.. ^ ^ V 8(c) of the International Banking Act of 1978 (12 U.S.C. 3106(c)) is amended by adding at the end thereof the following new paragraph: "(2) The authority conferred by this subsection on a foreign bank or other company shall terminate 2 years after the date on which such foreign bank or other company becomes a 'bank holding company' as defined in section 2(a) of the Bank Holding Company Act of 1956 (12 U.S.C. 1841(a)); except that the Board may, upon application of such foreign bank or other company, extend the 2-year period for not more than one year at a time, if, in its judgment, such an extension would not be detrimental to the public interest, but no such extensions shall exceed 3 years in the aggregate.". (b) CLERICAL AMENDMENT.—Section 8 of the International Banking Act of 1978 is amended by striking out "(c) After" and inserting in lieu thereof "(c)(1) After". SEC. 205. AMENDMENTS TO THE BANK HOLDING COMPANY ACT OF 1956. (a) EXCEPTION TO NONBANKING PROHIBITIONS.—Section 2(h) of the

Bank Holding Company Act of 1956 (12 U.S.C. 1841(h)) is amended by striking out paragraph (2) and by adding after paragraph (1) the following new paragraphs: "(2) Except as provided in paragraph (3), the prohibitions of section 4 of this Act shall not apply to shares of any company organized under the laws of a foreign country (or to shares held by such company in any company engaged in the same general line of business as the investor company or in a business related to the business of the investor company) that is principally engaged in business outside the United States if such shares are held or acquired by a bank holding company organized under the laws of a foreign country that is principally engaged in the banking business outside the United States. For the purpose of this subsection, the

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101 STAT. 585

term 'section 2(h)(2) company' means any company whose shares are held pursuant to this paragraph. "(3) Nothing in paragraph (2) authorizes a section 2(h)(2) company to engage in (or acquire or hold more than 5 percent of the outstanding shares of any class of voting securities of a company engaged in) any banking, securities, insurance, or other financial activities, as defined by the Board, in the United States. This paragraph does not prohibit a section 2(h)(2) company from holding shares that were lawfully acquired before the date of enactment of the Competitive Equality Banking Act of 1987. (4) No domestic office or subsidiary of a bank holding company or subsidiary thereof holding shares of a section 2(h)(2) company may extend credit to a domestic office or subsidiary of such section 2(h)(2) company on terms more favorable than those afforded similar borrowers in the United States. "(5) No domestic banking office or bank subsidiary of a bank holding company that controls a section 2(h)(2) company may offer or market products or services of such section 2(h)(2) company, or permit its products or services to be offered or marketed by or through such section 2(h)(2) company, unless such products or services were being so offered or marketed as of March 5, 1987, and then only in the same manner in which they were being offered or marketed as of that date.".

TITLE III—FSLIC RECAPITALIZATION SEC. 301. SHORT TITLE.

This title may be cited as the "Federal Savings and Loan Insurance Corporation Recapitalization Act of 1987".

Federal Savings and Loan Insurance Corporation Recapitalization Act of 1987. 12 USC 226 note.

SEC. 302. FINANCING CORPORATION ESTABLISHED.

The Federal Home Loan Bank Act (12 U.S.C. 1421 et seq.) is amended by inserting after section 20 the following new section: "SEC. 21. FINANCING CORPORATION. "(a) ESTABLISHMENT.—Notwithstanding any other provision of law, the Board shall charter a corporation to be known as the Financing Corporation. "(b) MANAGEMENT OF FINANCING CORPORATION.—

"(1) DIRECTORATE.—The Financing Corporation shall be under the management of a directorate composed of 3 members as follows: "(A) The Director of the Office of Finance of the Federal -, H Home Loan Banks (or the head of any successor to such office). "(B) 2 members selected by the Federal Home Loan Bank .}, Board from among the presidents of the Federal Home Loan Banks. "(2) TERMS.—Each member appointed under paragraph (1)(B) shall be appointed for a term of 1 year. "(3) VACANCY.—If any member leaves the office in which such member was serving when appointed to the Directorate— "(A) such member's service on the Directorate shall terminate on the date such member leaves such office; and "(B) the successor to the office of such member shall serve the remainder of such member's term.

12 USC 1441.

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Page:United States Statutes at Large Volume 101 Part 1.djvu/616

 101 STAT. 586

PUBLIC LAW 100-86—AUG. 10, 1987 ^

"(4) EQUAL REPRESENTATION OF BANKS.—No president of a

Federal Home Loan Bank may be appointed to serve an addi'0 tional term on the Directorate until such time as the presidents ''•• of each of the other Federal Home Loan Banks have served as '^ many terms on the Directorate as the president of such bank • (before the appointment of such president to such additional ^^ term). J" "(5) CHAIRPERSON.—The Chairman of the Federal Home Loan ^ Bank Board shall select the chairperson of the Directorate from among the 3 members of the Directorate.

"(6) STAFF.—

'S, ^ ,; ^^}!. ^^_ ^

"(A) No PAID EMPLOYEES.—The Financing Corporation shall have no paid employees. "(B) POWERS.—The Directorate may, with the approval of the Board, authorize the officers, employees, or agents of the Federal Home Loan Banks to act for and on behalf of the Financing Corporation in such manner as may be necessary to carry out the functions of the Financing Corporation. "(7) ADMINISTRATIVE EXPENSES.—

.

"(A) IN GENERAL.—All administrative expenses of the Financing Corporation shall be paid by the Federal Home Loan Banks. "(B) PRO RATA DISTRIBUTION.—The amount each Federal • Home Loan Bank shall pay shall be determined by the Board by multiplying the total administrative expenses for any period by the percentage arrived at by dividing— ,^ "(i) the aggregate amount the Board required such bank to invest in the Financing Corporation (as of the time of such determination) under paragraphs (4) and (5) of subsection (d) (as computed without regard to ^( paragraph (3) or (6) of such subsection); by ', "(ii) the aggregate amount the Board required all Federal Home Loan Banks to invest (as of the time of such determination) under such paragraphs. > ^

"(C) ADMINISTRATIVE EXPENSES DEFINED.—For purposes of

this paragraph, the term 'administrative expenses' does not include— "(i) issuance costs (as such term is defined in subsec.A; tion (g)(5)(A)); V '.%<,.... "(ii) any interest on (and any redemption premium with respect to) any obligation of the Financing Cor'- >•• poration; or "(iii) custodian fees (as such term is defined in subsection (g)(5)(B)). "(8) REGULATION BY BOARD.—The Directorate shall be subject to such regulations, orders, and directions as the Board may prescribe. ^

"(9) No COMPENSATION FROM FINANCING CORPORATION.—Mem-

bers of the Directorate shall receive no pay, allowances, or 'i benefits from the Financing Corporation by reason of their service on the Directorate. "(c) POWERS OF FINANCING CORPORATION.—The Financing Corporation shall have only the following powers, subject to the other provisions of this section and such regulations, orders, and directions as the Board may prescribe:

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Page:United States Statutes at Large Volume 101 Part 1.djvu/617

 PUBLIC LAW 100-86—AUG. 10, 1987

101 STAT. 587

"(1) To issue nonvoting capital stock to the Federal Home Loan Banks. "(2) To invest in any security issued by the Federal Savings and Loan Insurance Corporation under section 402(b) of the National Housing Act. "(3) To issue debentures, bonds, or other obligations and to borrow, to give security for any amount borrowed, and to pay interest on (and any redemption premium with respect to) any such obligation or amount. "(4) To impose assessments in accordance with subsection (f). "(5) To adopt, alter, and use a corporate seal. "(6) To have succession until dissolved. "(7) To enter into contracts. "(8) To sue and be sued in its corporate capacity, and to complain and defend in any action brought by or against the Financing Corporation in any State or Federal court of competent jurisdiction. "(9) To exercise such incidental powers not inconsistent with the provisions of this section or section 402(b) of the National Housing Act as are necessary or appropriate to carry out the provisions of this section. '(d) CAPITALIZATION OF FINANCING CORPORATION.— "(1) PURCHASE OF CAPITAL STOCK BY FEDERAL HOME LOAN BANKS.—

"(A) IN GENERAL.—Each Federal Home Loan Bank shall invest in nonvoting capital stock of the Financing Corporation at such times and in such amounts as the Board may prescribe under this subsection. "(B) PAR VALUE; TRANSFERABILITY.—Each share of stock issued by the Financing Corporation to a Federal Home Loan Bank shall have par value in an amount determined by the Board and shall be transferable only among the Federal Home Loan Banks in the manner and to the extent prescribed by the Board at not less than par value. "(2) AGGREGATE DOLLAR AMOUNT LIMITATION ON ALL INVEST-

MENTS.—The aggregate amount of funds invested by all Federal Home Loan Banks in nonvoting capital stock of the Financing Corporation shall not exceed $3,000,000,000. "(3) MAXIMUM INVESTMENT AMOUNT LIMITATION FOR EACH FEDERAL HOME LOAN BANK.—The cumulative amount of funds in-

vested in nonvoting capital stock of the Financing Corporation by each Federal Home Loan Bank shall not exceed the aggregate amount of— "(A) the sum of— "(i) the reserves maintained by such bank on December 31, 1985, pursuant to the requirement contained in the first 2 sentences of section 16; and "(ii) the undivided profits (as defined in paragraph (7)) of such bank on such date; and "(B) the sum of— "(i) the amounts added to reserves after December 31, 1985, pursuant to the requirement contained in the first 2 sentences of section 16; and "(ii) the undivided profits of such bank accruing after such date. "(4) PRO RATA DISTRIBUTION OF IST $1,000,000,000 INVESTED IN FINANCING CORPORATION BY HOME LOAN BANKS.—With respcct to

Post, p. 597.

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Page:United States Statutes at Large Volume 101 Part 1.djvu/618

 101 STAT. 588

"fi"; q,ss/^

PUBLIC LAW 100-86—AUG. 10, 1987

 * , T. the first $1,000,000,000 which the Board may require the Federal Home Loan Banks to invest in capital stock of the Financ^o,.' ing Corporation under this subsection, the amount which each

9ri Federal Home Loan Bank (or any successor to such bank) shall invest shall be determined by the Board by applying to the total - amount of such investment by all such banks the percentage appearing in the following table for each such bank: "Bank Federal Federal Federal Federal Federal Federal Federal Federal Federal Federal Federal Federal ^'

_^

, ' ^* sJ'jo

"(5)

Home Loan Home Loan Home Loan Home Loan Home Loan Home Loan Home Loan Home Loan Home Loan Home Loan Home Loan Home Loan

Bank Bank Bank Bank Bank Bank Bank Bank Bank Bank Bank Bank

of Boston of New York of Pittsburgh of Atlanta of Cincinnati of Indianapolis of Chicago of Des Moines of Dallas of Topeka of San Francisco of Seattle

Percentage 1.8629 9.1006 4.2702 14.4007 8.2653 5.2863 9.6886 6.9301 8.8181 5.2706 19.9644 6.1422

PRO RATA DISTRIBUTION OF AMOUNTS REQUIRED TO BE

INVESTED IN EXCESS OF $1,000,000,000.—With rcspect to any amount in excess of $1,000,000,000 which the Board may require the Federal Home Loan Banks to invest in capital stock of the Financing Corporation under this subsection, the amount which each Federal Home Loan Bank (or any successor to such bank) shall invest shall be determined by the Board by multiplying such excess amount by the percentage arrived at by dividing— "(A) the sum of the total assets (as of the most recent ' December 31) held by all insured institutions which are members of such bank; by "(B) the sum of the total assets (as of such date) held by all insured institutions which are members of any Federal Home Loan Bank.

"(6) SPECIAL PROVISIONS RELATING TO MAXIMUM AMOUNT ,-^^ LIMITATIONS.—

"(A) IN GENERAL.—If the amount any Federal Home Loan Bank is required to invest in capital stock of the Financing Corporation pursuant to a determination by the Board .,,, under paragraph (5) (or under subparagraph (B) of this paragraph) exceeds the maximum investment amount applicable with respect to such bank under paragraph (3) at ,:,..,.^^ the time of such determination (hereinafter in this para*""" graph referred to as the 'excess amount')— "(i) the Board shall require each remaining Federal ,' ^^.y": Home Loan Bank to invest (in addition to the amount ,. r, determined under paragraph (5) for such remaining bank and subject to the maximum investment amount .•;, 4 '. applicable with respect to such remaining bank under paragraph (3) at the time of such determination) in such capital stock on behalf of the bank in the amount . i, determined under subparagraph (B); "(ii) the Board shall require the bank to subsequently purchase the excess amount of capital stock from the ,'//£., K "(iii) the requirements contained in subparagraphs ),;.A,?, (D) and (E) relating to the use of net earnings available
 * , ', ^,,. remaining banks in the manner described in subparagraph (C); and

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101 STAT. 589

for dividends shall apply to such bank until the bank has purchased all of the excess amount of capital stock. "(B) ALLOCATION OF EXCESS AMOUNT AMONG REMAINING

HOME LOAN BANKS,—The amount each remaining Federal Home Loan Bank shall be required to invest under subparagraph (A)(i) is the amount determined by the Board by multiplying the excess amount by the percentage arrived at by dividing— "(i) the amount of capital stock of the Financing Corporation held by such remaining bank a t the time of such determination; by "(ii) the aggregate amount of such stock held by all remaining banks at such time. "(C) PURCHASE PROCEDURE.—The bank on whose behalf an investment in capital stock is made under subparagraph (A)(i) shall purchase, annually and a t the issuance price, from each remaining bank an amount of such stock determined by the Board by multipl3ring the amount available for such purchases (at the time of such determination) by the percentage determined under subparagraph (B) with respect to such remaining bank until the aggregate amount of such capital stock has been purchased by the bank. "(D) LIMITATION ON DIVIDENDS.—The amount of dividends

which may be paid for any year by a bank on whose behalf an investment is made under subparagraph (A)(i) shall not exceed an amount equal to ¥2 of the net earnings available for dividends of the bank for the year. "(E) TRANSFER TO ACCOUNT FOR PURCHASE OF STOCK RE-

QUIRED.—Of the net earnings available for dividends for any year of a bank on whose behalf an investment is made under subparagraph (A)(i), such amount as is necessary to make the purchases of stock required under subparagraph (A)(ii) shall be placed in a reserve account (established in such manner as the Board shall prescribe by regulations) the balance in which shall be available only for such purchases. "(F) N E T EARNINGS AVAILABLE FOR DIVIDENDS DEFINED.—

For purposes of this paragraph, the term 'net earnings available for dividends means the net earnings of a bank for any period as computed after reducing the amount of earnings for such period by the amount required to be carried (for such period) to reserves maintained by such bank pursuant to the first two sentences of section 16 of this Act. "(7) UNDIVIDED PROFITS DEFINED.—For

purposes of paragraph (3), the term 'undivided profits' means retained earnings minus the sum of— "(A) that portion required to be added to reserves maintained pursuant to the first two sentences of section 16 of this Act; and "(B) the dollar amounts held by the respective Federal Home Loan Banks in special dividend stabilization reserves on December 31, 1985, as determined under the following table:

12 USC 1436.

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Page:United States Statutes at Large Volume 101 Part 1.djvu/620

 101 STAT. 590

PUBLIC LAW 100-86—AUG. 10, 1987

"Bank Federal Federal Federal Federal Federal Federal Federal Federal Federal Federal Federal Federal

Home Loan Home Loan Home Loan Home Loan Home Loan Home Loan Home Loan Home Loan Home Loan Home Loan Home Loan Home Loan

Bank Bank Bank Bank Bank Bank Bank Bank Bank Bank Bank Bank

of Boston of New York of Pittsburgh of Atlanta of Cincinnati of Indianapolis of Chicago of Des Moines of Dallas of Topeka of San Francisco of Seattle

Dollar amount $3.2 million 7.7 million 5.2 million 12.3 million 5.9 million 37.4 million 6.0 million 32.7 million 45.0 million 13.7 million 21.9 million 33.6 million

"(e) OBLIGATIONS OF THE FINANCING CORPORATION.— "(1) LIMITATION ON AMOUNT OF OUTSTANDING OBLIGATIONS.—

The aggregate amount of obligations of the Financing Corporation which may be outstanding at any time (as determined by the Board) shall not exceed the lesser of^ "(A) an amount equal to the greater of— "(i) 5 times the amount of the nonvoting capital stock of the Financing Corporation which is outstanding at such time; or "(ii) the sum of the face amounts (the amount of principal payable at maturity) of securities described in subsection (g)(2) which are held at such time in the segregated account established pursuant to such subsection; or "(B) $10,825,000,000. "(2) ANNUAL LIMITATION ON NET NEW BORROWING.—Net new

borrowing by the Financing Corporation— "(A) shall not exceed an amount equal to $3,750,000,000 in the 1-year period beginning on the date of the enactment of the Federal Savings and Loan Insurance Corporation Recapitalization Act of 1987; and "(B) shall not exceed an amount equal to $3,750,000,000 in each 1-year period beginning after the 1-year period described in subparagraph (A). "(3) N E T PROCEEDS TO BE INVESTED IN CAPITAL OF FSUC.—

Post, p. 597. S;:M.;: I

Subject to such terms and conditions as may be approved by the Board, the net proceeds of any obligation issued by the Financing Corporation shall be used to— "(A) purchase capiteil certificates or capital stock issued by the Federal Savings and Loan Insurance Corporation under section 4020t))(l)(A) of the National Housing Act; or "(B) refund any previously issued obligation the net proceeds of which were invested in the manner described in subparagraph (A). "(4) LIMITATION ON TERM OF OBLIGATIONS.—NO obligation of the Financing Corporation may be issued which matures— "(A) more than 30 years after the date of issue; or "(B) after December 31, 2026. "(5) INVESTMENT OF UNITED STATES FUNDS IN OBLIGATIONS.—

Obligations issued under this section by the Financing Corporation with the approval of the Board shall be lawful investments, and may be accepted as security, for all fiduciary, trust, and public funds the investment or deposit of which shall be under the authority or control of the United States or any officer of the United States. "(6) MARKET FOR OBLIGATIONS.—All persons having the power to invest in, sell, underwrite, purchase for their own accounts, accept as security, or otherwise deal in obligations of the Fed-

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 PUBLIC LAW 100-86—AUG. 10, 1987

101 STAT. 591

eral Home Loan Banks shall also have the power to do so with respect to obligations of the Financing Corporation. "(7) N o FULL FAITH AND CREDIT OF THE UNITED STATES.—

Obligations of the Financing Corporation and the interest payable on such obligations shall not be obligations of, or guaranteed as to principal or interest by, the Federal Home Loan Banks, the United States, or the Federal Savings and Loan Insurance Corporation and the obligations shall so plainly state. "(8) TAX EXEMPT STATUS.—

"(A) IN GENERAL.—Except as provided in subparagraph (B), obligations of the Financing Corporation shall be exempt from tax both as to principal and interest to the same extent as any obligation of a Federal Home Loan Bank is exempt from tax under section 13. "(B) EXCEPTION.—The Financing Corporation, like the Federal Home Loan Banks, shall be treated as an agency of the United States for purposes of the first sentence of section 3124(b) of title 31, United States Code (relating to determination of tax status of interest on obligations).

12 USC 1433.

"(9) OBLIGATIONS ARE EXEMPT SECURITIES.—Notwithstanding

paragraph (7), obligations of the Financing Corporation shall be deemed to be exempt securities (within the meaning of laws administered by the Securities and Exchange Commission) to the same extent as securities which are direct obligations of the United States or are guaranteed as to principal or interest by the United States. "(10)

MINORITY PARTICIPATION IN PUBLIC OFFERINGS.—The

Chairman of the Board and the Directorate shall ensure that minority owned or controlled commercial banks, investment banking firms, underwriters, and bond counsels throughout the United States have an opportunity to participate to a significant degree in any public offering of obligations issued under this section. '(f) ASSESSMENT AUTHORITY OF THE FINANCING CORPORATION.—

"(1) IN GENERAL.—The Financing Corporation may, with the approval of the Board, assess on each insured institution an assessment, except that the aggregate amount assessed under this paragraph on any insured institution for any year may not exceed an amount equal to Vi2th of 1 percent of the aggregate amount of all accounts of insured members of such insured institution. "(2)

>_v, •

SUPPLEMENTAL

ASSESSMENT

AUTHORIZED.—Upon

the

unanimous vote of the Directorate that additional funds are needed to pay the interest on the obligations of the Financing Corporation because no other funds are available, the Financing Corporation may, with the approval of the Board and in addition to any assessment assessed under paragraph (1), assess on each insured institution an assessment, except that the aggregate amount assessed under this paragraph on any insured institution for any year may not exceed an amount equal to Vsth of 1 percent of the aggregate amount of all accounts of insured members of such insured institution. "(3) TOTAL AMOUNT OF ASSESSMENTS MAY NOT EXCEED INTEREST AND FINANCING COSTS.—The aggregate amount of all assess-

ments assessed under paragraphs (1) and (2) for any year may not exceed— "(A) the aggregate amount of—

..

^.*•

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Page:United States Statutes at Large Volume 101 Part 1.djvu/622

 101 STAT. 592

PUBLIC LAW 100-86—AUG. 10, 1987
 * .«w?

 * 4.

"(i) issuance costs (as such term is defined in subsection (g)(5)(A)) incurred with respect to obligations issued during such year; "(ii) interest paid on (and any redemption p r e m i u m paid with respect to) obhgations of the Financing Corporation during such year; and "(iii) custodian fees (as such term is defined in subsection (g)(5)(B)) incurred during such year; m i n u s "(B) the aggregate a m o u n t of any payments under subsection (g)(4) during such year.

y. K

"(4) TERMINATION ASSESSMENTS.— "(A) ASSESSMENT AUTHORIZED.—The F i n a n c i n g Corpora-

^

. V.

tion shall, with the approval of the Board, assess a termi• &^i 5 ^^-J y:t nation assessment on any insured institution which ceases j-> to be an insured institution. "(B) MAXIMUM AMOUNT OF ASSESSMENT.—The amount of i' the assessment on any institution under subparagraph (A) J -i shall be the amount which is equal to the sum of— "(i) the amount which is equal to 2 times the last annual insurance premium payable by such institution 12 USC 1727. under section 404(b) of the National Housing Act (including the amount of any assessment imposed under paragraph (1) of this subsection in lieu of any such premium); and "(ii) the amount which is the product of— "(I) the aggregate amount of all accounts of in^ ^ ^ ^ '• ' sured members of such institution (as of the date the institution ceases to be an insured institution); ^ and "(II) 2 times the rate (expressed as an annual rate) at which the supplemental assessment under Post, p. 601. Rtoi - :pin x section 404(c) of the National Housing Act was assessed against insured institutions by the Fed'^^ eral Savings and Loan Insurance Corporation in > ^ 1986. "(C) REDUCTION IN ASSESSMENT ALLOWED FOR WEAKENED

tKti

INSTITUTIONS.—The amount of any assessment which the Financing Corporation may otherwise impose under this paragraph on an institution (which ceases to be an insured institution) may be reduced by such amount as the Financing Corporation, with the approval of the Board, may deem appropriate when— "(i) the institution poses a substantial risk to the assets of the Federal Savings and Loan Insurance Corporation; and "(ii) such reduction is necessary to assist in the sale or other disposition of the institution. "(D) TIME FOR PAYING ASSESSMENT.— "(i) DUE WITHIN 30 DAYS.—If an

to.. i t,.

Yi©rti »f \

assessment is imposed on an institution under subparagraph (A), the institution shall be obligated to pay such assessment before the end of the 30-day period beginning on the date on which such institution ceases to be an insured institution. "(ii)

SEMIANNUAL INSTALLMENTS WITH INTEREST.—

Notwithstanding the requirement of clause (i), an institution may elect to pay the amount of any assess-

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text: Dictionary of National Biography, 1885-1900/Patterson, Robert Hogarth


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-Ar €;

101 STAT. 593

ment imposed under subparagraph (A) in semiannual installments during the period beginning no later than the end of the 30-day period referred to in clause (i) and ending no later than the end of the 2-year period beginning on the date such assessment is imposed, together with interest accruing on the unpaid balance of such amount at a variable rate equal to the sum of^ "(I) the bond equivalent yield on 6-month United States Treasury bills; and "(II) 100 basis points. "(E) EXIT FEE EQUAUZATION.—If any institution described

in subparagraph (F) paid any exit fee, or the equivalent thereof (as determined by the Corporation), on or before the date of the enactment of the Federal Savings and Loan Insurance Corporation Recapitalization Act of 1987, the Corporation shall repay to such institution an amount equal to the amount by which the amount of such fee exceeds the amount which such institution would be required to pay if the amount of such fee were determined under this paragraph as of the date of the enactment of this Act.

. ^. ^ '"

"(F) PROVISIONS APPLICABLE TO CERTAIN INSTITUTIONS.—

t" ' d. Oif «. a

^, tjf/t '

Except as provided in subparagraph (E), no assessment under this paragraph or insurance premium under section 407(d) of the National Housing Act may be imposed on an Post, p. 602. insured institution which, on or before March 31, 1987, had— "(i) its status as an insured institution terminated voluntarily, involuntarily, or by operation of law in connection with a conversion into, merger with, acquisition by, consolidation with, reorganization into, or combination by any means with, an institution the deposits of which are insured by the Federal Deposit Insurance Corporation; "(ii) filed an application or notice with any State banking agency or authority, or with the Comptroller of the Currency, the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System, the Corporation or the Federeil Home Loan Bank Board pursuant to a transaction which, upon consummation thereof, will result in the termination of the institution's status as an insured institution in connection with its conversion into, merger with, acquisition by, consolidation with, reorganization into, or combination by any means with, an institution the deposits of which are insured by the Federal Deposit Insurance Corporation; or "(iii) entered into a letter of intent or a written memorandum of understanding, pursuant to a transaction which will result in the termination of the institution's status as an insured institution in connection with its conversion into, merger with, acquisition by consolidation with, reorganization into, or combination by any means with, an institution the deposits of which are insured by the Federal Deposit Insurance Corporation.

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 101 STAT. 594

PUBLIC LAW 100-86—AUG. 10, 1987

Michigan.

"(G) ADDITIONAL PROVISION.—Notwithstanding any other provision of law, the Federal Savings and Loan Insurance Corporation shall repay to Comerica, Inc. of Detroit, Michigan, an amount equal to any exit fee or equivalent thereof paid by Comerica, Inc. "(5) PAYMENT TO FINANCING CORPORATION.—All assessments assessed by the Financing Corporation under paragraph (1), (2), or (4) shall be paid to the Financing Corporation. "(g) USE AND DISPOSITION OF ASSETS OF THE FINANCING CORPORATION NOT INVESTED IN F S L I C —

Post, p. 597.

12 USC 1454, 1455.

"(1) IN GENERAL.—Subject to such regulations, restrictions, and limitations as may be prescribed by the Board, assets of the Financing Corporation, which are not invested in capital certificates or capital stock issued by the Federal Savings and Loan Insurance Corporation under section 402(b)(1)(A) of the National Housing Act, shall be invested in— "(A) direct obligations of the United States; -rt «(g) obligations, participations, or other instruments of, or issued by, the Federal National Mortgage Association or the Government National Mortgage Association; "(C) mortgages, obligations, or other securities for sale by, ^ ' ' or which have been disposed of by, the Federal Home Loan Mortgage Corporation under section 305 or 306 of the Federal Home Loan Mortgage Corporation Act; or "(D) any other security in which it is lawful for fiduciary and trust funds to be invested under the laws of any State. ^

"(2) SEGREGATED ACCOUNT FOR ZERO COUPON INSTRUMENTS HELD TO ASSURE PAYMENT OF PRINCIPAL.—The Financing Cor-

poration shall invest in, and hold in a segregated account, noninterest bearing instruments— "(A) which are securities described in paragraph (1); and " "(B) the total of the face amounts (the amount of principal payable at maturity) of which is approximately equal ^^^,,, to the aggregate amount of principal on the obligations of ^•>x-. i ^jjg Financing Corporation, to assure the repayment of principal on obligations of the Financing Corporation. "(3)

DOLLAR AMOUNT LIMITATION ON INVESTMENT IN ZERO

COUPON INSTRUMENTS FOR SEGREGATED ACCOUNT.—The aggregate amount invested by the Financing Corporation under paragraph (2) shall not exceed $2,200,000,000 (as determined on the basis of the purcheise price). "(4) EXCEPTION FOR PAYMENT OF ISSUANCE COSTS, INTEREST,

AND CUSTODIAN FEES.—Notwithstanding the requirements of I paragraph (1), the assets of the Financing Corporation referred to in paragraph (1) which are not invested under paragraph (2) may be used to pay— "(A) issuance costs; "(B) any interest on (and any redemption premium with respect to) any obligation of the Financing Corporation; and "(C) custodian fees. "(5) DEFINITIONS.—For purposes of this subsection— "(A) ISSUANCE COSTS.—The term 'issuance costs'— "(i) means issuance fees and commissions incurred by the Financing Corporation in connection with the issu-

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 PUBLIC LAW 100-86—AUG. 10, 1987 i %. i

101 STAT. 595

ance or servicing of any obligation of the Financing Corporation; and "(ii) includes legal and accounting expenses, trustee and fiscal and paying agent charges, costs incurred in connection with preparing and printing offering materials, and advertising expenses, to the extent that any such cost or expense is incurred by the Financing Corporation in connection with issuing any obligation. "(B) CUSTODIAN FEES.—The term 'custodian fee' means— "(i) any fee incurred by the Financing Corporation in connection with the transfer of any security to, or the maintenance of any security in, the segregated account established under paragraph (2); and "(ii) any other expense incurred by the Financing Corporation in connection with the establishment or maintenance of such account.

L" '.u'"

fi -'

"(h) MISCELLANEOUS PROVISIONS RELATING TO FINANCING CORPORATION.— "(1) TREATMENT FOR CERTAIN PURPOSES.—Except as provided

•

in subsection (e)(8)(B), the Financing Corporation shall be treated as a Federal Home Loan Bank for purposes of sections " '^ 13 and 23. 12 USC 1433, "(2) FEDERAL RESERVE BANKS AS DEPOSITARIES AND FISCAL 1443.

AGENTS.—The Federal Reserve banks are authorized to act as depositaries for or fiscal agents or custodians of the Financing Corporation. "(3)

APPLICABILITY OF CERTAIN PROVISIONS RELATING TO

GOVERNMENT CORPORATION.—Notwithstanding the fact that no Government funds may be invested in the Financing Corporation, the Financing Corporation shall be treated, for purposes of sections 9105, 9107, and 9108 of title 31, United States Code, as a mixed-ownership Government corporation which has capital of the Government, "(i) FEDERAL SAVINGS AND LOAN INSURANCE CORPORATION INDUSTRY ADVISORY COMMITTEE.—

"(1) ESTABLISHMENT.—There is hereby established the Federal Savings and Loan Insurance Corporation Industry Advisory Committee (hereinafter in this subsection referred to as the 'Committee'). "(2) MEMBERSHIP.—

. j^

-,...

"(A) APPOINTMENT.—The Committee shall consist of 13 members selected as follows: "(i) 1 member appointed by the Chairman of the Board from among individuals who are officers of insured institutions and who are not members of the Board or employees of the Board, the Federal Savings and Loan Insurance Corporation, or the Board of Directors of any Federal Home Loan Bank. "(ii) 1 member elected from each Federal Home Loan Bank district (by the members of the Board of Directors of each such bank who were elected by the members of such bank) from among individuals who are officers of insured institutions. "(B) TERMS.—Members shall be appointed or elected for terms of 1 year.

.

�


text:
Page:United States Statutes at Large Volume 101 Part 1.djvu/626

 101 STAT. 596

PUBLIC LAW 100-86—AUG. 10, 1987

3Jli:>

Reports.

Post, p. 603. .AD

OJ

"(C) CHAIRPERSON.—The member appointed under subparagraph (A)(i) shall be the chairperson of the Committee. "(D) VACANCIES.—Any vacancy on the Committee shall be filled in the manner in which the original appointment was made. "(E) PAY AND EXPENSES.—Members of the Committee shall serve without pay but each member of the Committee shall be reimbursed, in such manner as the Board may prescribe by regulation, by the Federal Home Loan Bank which elected such member (and, in the case of the member appointed by the Chairman of the Board, by the Board) for expenses incurred in connection with attendance of such members at meetings of the Committee. "(F) MEETINGS.—The Committee shall meet from time to time at the call of the chairperson or a majority of the members. "(3) DUTIES OF THE COMMITTEE.—The duties of the Committee

are as follows: "(A) To review the reports and budgets prepared pursuant to section 402(k) of the National Housing Act and any other matter which the Board may present for the Committee's consideration. "(B) To confer with the Board on the reports, budgets, and other matters reviewed under subparagraph (A). "(C) To prepare written comments and recommendations for the Board and the Federal Savings and Loan Insurance Corporation with respect to the reports, budgets, and other matters reviewed under subparagraph (A) (which shall be submitted to the Board in a timely manner after each meeting). "(4) ANNUAL REPORT.—

"(A) REQUIRED.—Not later than January 15 of each year, the Committee shall submit a report to the Committee on i'Ci Banking, Finance and Urban Affairs of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate. "(B) (CONTENTS.—The report required under subparagraph (A) shall describe the activities of the Committee during the preceding year and the reports and rec„ ommendations made by the Committee to the Board and '^ the Federal Savings and Loan Insurance Corporation during such year. "(5) REGULATIONS.—The Board shall prescribe such regulations as the Board determines to be appropriate to avoid conflicts of interest with respect to the disclosure to and use by members of the Committee of information relating to the Board, the Federal Savings and Loan Insurance Corporation, the Federal Home Loan Banks, and the Federal Asset Disposition Association. "(6) FEDERAL ADVISORY COMMITTEE ACT DOES NOT APPLY.—The 5 USC app.

Federal Advisory Committee Act shall not apply to the Committee. "(7) TERMINATION.—The Committee shall terminate when the Financing Corporation terminates under subsection (j). "(j) TERMINATION OF THE FINANCING CORPORATION.—

�


text: Dictionary of National Biography, 1885-1900/Patteson, John (1790-1861)


text:
Page:United States Statutes at Large Volume 101 Part 1.djvu/627

 PUBLIC LAW 100-86—AUG. 10, 1987

101 STAT. 597

"(1) IN GENERAL.—The Financing Corporation shall be dissolved, as soon as practicable, after the earlier of— "(A) the date by which all stock purchased by the Financing Corporation in the Federal Savings and Loan Insurance Corporation has been retired; or .,,, "(B) December 31, 2026. "(2) BOARD AUTHORITY TO CONCLUDE THE AFFAIRS OF FINANCING

CORPORATION.—Effective on the date of the dissolution of the Financing Corporation under paragraph (1), the Board may exercise, on behalf of the Financing Corporation, any power of the Financing Corporation which the Board determines to be necessary to settle and conclude the affairs of the Financing Corporation. "(k) REGULATIONS.—The Board may prescribe such regulations as may be necessary to carry out the provisions of this section, including regulations defining terms used in this section. (1) DEFINITIONS.—For purposes of this section— "(1) INSURED INSTITUTION.—The term 'insured institution' has ^ the meaning given to such term by section 401(a) of the National Housing Act. 12 USC 1724. "(2) INSURED MEMBER.—The term 'insured member' has the meaning given to such term by section 401(b) of the National Housing Act. "(3) DIRECTORATE.—The term 'Directorate' means the direc, torate established in the manner provided in subsection (b)(1) to manage the Financing Corporation.". SEC. 303. MIXED OWNERSHIP GOVERNMENT CORPORATION.

Section 9101(2) of title 31, United States Code, is amended by adding at the end thereof the following new subparagraph: "(K) ThelFinancing Corporation.". SEC. 304. RECAPITALIZATION OF FSLIC.

Section 402(b) of the National Housing Act (12 U.S.C. 1725(b)) is amended to read as follows: "(b) ISSUANCE AND SALE OF CAPITAL CERTIFICATES AND STOCK TO FINANCING CORPORATION.— "(1) AUTHORIZATION TO ISSUE.—

.,,

"(A) IN GENERAL.—Notwithstanding any other provision of law, the Corporation may issue— "(i) nonredeemable capital certificates; and "(ii) redeemable nonvoting capital stock.

^

"(B) REQUIREMENT RELATING TO AMOUNT OF STOCK.—The

^j ^

,

aggregate amount of stock issued by the Corporation under subparagraph (A)(ii) shall be equal to the aggregate amount of the investments made by the Federal Home Loan Banks in the capital stock of the Financing Corporation under section 21 of the Federal Home Loan Bank Act. Ante, p. 585. "(C)

^ "s.>^

CERTIFICATES AND STOCK MAY BE SOLD ONLY TO

FINANCING CORPORATION.—Capital certificates and stock issued under subparagraph (A) may be sold only to the Financing Corporation in the manner and to the extent provided in section 21 of the Federal Home Loan Bank Act and this subsection. "(D) PROCEEDS OF SALE ARE PART OF PRIMARY RESERVE.—

The proceeds of any sale of capital certificates or stock under this paragraph shall Be considered part of the pri-

�


text:
Page:United States Statutes at Large Volume 101 Part 1.djvu/628

 101 STAT. 598

PUBLIC LAW 100-86—AUG. 10, 1987 mary reserve established by the Corporation pursuant to section 404(a). "(E) No DIVIDENDS.—The Corporation shall pay no dividends on any capital certificates or stock issued under this paragraph.

12 USC 1727.

"(2) EQUITY RETURN ACCOUNT.—

"(A) IN GENERAL.—The Corporation shall establish and maintain (until all capital stock issued under subparagraph (A)(ii) of paragraph (1) has been paid off and retired) an equity return account— "(i) which shall consist only of amounts contributed in accordance with the requirements of subparagraph t^--— (B); "(ii) which shall not be treated as reserves of the " Corporation; and "(iii) the earnings accruing in which shall be transferred in the manner provided in subparagraph (D). "(B) CONTRIBUTIONS TO ACCOUNT.— "(i) No CONTRIBUTION IF RESERVES-TO-ACCOUNTS RATIO

^,.. -*'

_,^,^,,

IS LESS THAN 0.5 PERCENT.—No Contribution shall be made to the equity reserve account established pursuant to subparagraph (A) in any year in which the reserves-to-accounts ratio is less than 0.5 percent. "(ii)

ANNUAL CONTRIBUTIONS REQUIRED.—Except

as

provided in clause (i), the Corporation shall make contributions to the equity reserve account established pursuant to subparagraph (A)— "(I) at the end of each year beginning after 1996 . - ,,«., through the final payoff year (as defined in clause ' -• >:\ (vii)); and "(II) in amounts determined under clauses (iii), (iv), (v), and (vi) of this subparagraph, "(iii) AMOUNT OF PRIMARY CONTRIBUTION.—The pri.,. mary contribution to the equity return account for any year for which a contribution is required to be made shall be the amount determined by dividing— ' "' "(I) the aggregate amount of capital stock issued by the Corporation and purchased by the Financing Corporation under paragraph (1)(A); by •>••••'.•• "(II) the number of years between the first year beginning after 1996 in which the reserves-toaccounts ratio is equal to or greater than 0.5 percent and the final payoff year (taking into account the first and last year described). "(iv) AMOUNT OF ADDITIONAL CONTRIBUTION ALLOWED IF RESERVES-TO-ACCOUNTS RATIO DOES NOT EXCEED 1.25

'"*' '•''

^

.

' ,

"^'

PERCENT.—In any year in which the reserves-to-accounts ratio is equal to or greater than 1 percent but less than 1.25 percent, the Federal Home Loan Bank Board may require the Corporation to make an additional contribution of an amount not to exceed the amount determined by dividing— "(I) the investment return amount (as defined in clause (viii)) computed at an annual compound rate not to exceed 6 percent; by "(II) the number of years between the first year beginning after 1996 in which the reserves-to-

�


text: Dictionary of National Biography, 1885-1900/Patteson, John Coleridge


text:
Page:United States Statutes at Large Volume 101 Part 1.djvu/629

 PUBLIC LAW 100-86—AUG. 10, 1987

101 STAT. 599

accounts ratio was equal to or greater than 1 percent and the final payoff year (taking into account the first and last year described).

ri't;

"(v) AMOUNT OF ADDITIONAL CONTRIBUTION ALLOWED IF RESERVES-TO-ACCOUNTS RATIO DOES NOT EXCEED 1.75

v;

fe, ^ r

PERCENT.—In any year in which the reserves-to-accounts ratio is equal to or greater than 1.25 percent but less than 1.75 percent, the Federal Home Loan Bank Board may require the Corporation to make an additional contribution of an amount not to exceed the amount determined by dividing— "(I) the investment return amount computed at an annual compound rate not to exceed 8 percent, minus the sum of any amounts contributed under clause (iv); by "(II) the number of years between the first year beginning after 1996 in which the reserves-toaccounts ratio was equal to or greater than 1.25 percent and the final payoff year (taking into account the first and last year described), "(vi) AMOUNT OF ADDITIONAL CONTRIBUTION ALLOWED IF RESERVES-TO-ACCOUNTS RATIO EXCEEDS 1.75 PERCENT.—

„

'^

i '

In any year in which the reserves-to-accounts ratio is equal to or greater than 1.75 percent, the Federal Home Loan Bank Board may require the Corporation to make an additional contribution of an amount not to exceed the amount determined by dividing— "(I) the investment return amount computed at an annual compound rate not to exceed 10 percent, minus the sum of any amounts contributed under clause (iv) or (v); by "(II) the number of years between the first year beginning after 1996 in which the reserves-toaccounts ratio was equal to or greater than 1.75 percent and the final payoff year (taking into account the first and last year described).

 * '. i -3 J si

"(vii) FINAL PAYOFF YEAR DEFINED.—For purposes of

this subparagraph, the term 'final payoff year means the year of maturity of the last maturing obligation of the Financing Corporation (which was issued under section 21 of the Federal Home Loan Bank Act and Ante, p. 585. matures before January 1, 2027). "(viii) INVESTMENT RETURN AMOUNT.—For purposes

art J -K!A

If;»

I

of clauses (iv), (v), and (vi), the term 'investment return amount' means the amount which would be realized on the aggregate amount invested by the Financing Corporation in capital stock issued by the Corporation under paragraph (1) over the period of the investment if the return on the investment is computed at the rate described in subclause (I) of the respective clauses. " (C) INVESTMENT OF AMOUNTS IN ACCOUNT.—Amounts

accumulating in the equity return account may be invested in such manner as the Corporation determines. "(D) TRANSFER OF EARNINGS TO PRIMARY RESERVE.—Earn-

r

ings accruing on any investment (under subparagraph (O) of amounts in the equity return account shall be transferred to the primary reserve account of the Corporation

�


text:
Page:United States Statutes at Large Volume 101 Part 1.djvu/630

 101 STAT. 600 12 USC 1727.

PUBLIC LAW 100-86—AUG. 10, 1987 \^^'' '^'

uM

'. Ante, p. 585. ,,,

established pursuant to section 404(aj as such earnings are realized by the Corporation and shall not be treated as amounts in the account. «^g^ RETIREMENT OF CAPITAL STOCK USING BALANCE IN

ACCOUNT.—Upon maturity of all obligations of the Financing Corporation under section 21 of the Federal Home Loan Bank Act, the Corporation shall pay off and retire any capital stock issued under paragraph (IXAXii) using only amounts accumulated in the equity return account. "(F) RESERVES-TO-ACCOUNTS RATIO DEFINED.—For purposes

l«

of this paragraph, the term 'reserves-to-accounts ratio' means, with respect to any year, the amount determined by dividing— "(i) the amount of reserves of the Corporation (deter-•i;/ *' mined as of December 31 of the preceding year); by "(ii) the aggregate amount of all accounts of all of its insured members (determined as of such date). "(3) FINANCING CORPORATION DEFINED.—For purposes of this subsection, the term 'Financing Corporation' means the Financing Corporation established under section 21 of the FedereJ Home Loan Bank Act. "(4) No REDUCTION OR SUSPENSION OF INSURANCE PREMIUMS

WHILE STOCK IS OUTSTANDING.—Notwithstanding any other provision of law, the provisions of subsections (b)(2) and (g) of section 404 shall not apply as long as any share of capital stock issued under paragraph (IXAXii) is outstanding.". 12 USC 1727.

SEC. 305. FSLIC AUTHORITY TO CHARGE PREMIUMS REDUCED BY AMOUNT OF FINANCING CORPORATION ASSESSMENTS. Section 404 of the National Housing Act is amended by adding at the end thereof the following new subsection: "(j) AUTHORITY TO CHARGE PREMIUMS REDUCED BY AMOUNT OF FINANCING CORPORATION ASSESSMENTS.—Notwithstanding any other

., ^,,

provision of this section, the sum of— "(1) the amount of any premium required to be paid by any insured institution under subsection (b)(D; and "(2) the amount of any premium authorized to be assessed by the Corporation under subsection (c) with respect to such institution, for any period shall be reduced by the amount of any assessment paid for such period by such insured institution to the Financing Corporation pursuant to section 21(f) of the Federal Home Loan Bank Act.". SEC. 306. MISCELLANEOUS PROVISIONS. (a) FEDERAL HOME LOAN BANK DIVIDENDS.—Section 16 of

the

Federal Home Loan Bank Act (12 U.S.C. 1436) is amended by adding at the end thereof the following new subsection: "(c) EXCEPTION IN CASE OF LOSSES IN CONNECTION WITH FINANCING CORPORATION STOCK.—

"(1) IN GENERAL.—Notwithstanding subsection (a) of this section, if— "(A) a Federal Home Loan Bank incurs a chargeoff or an • ^ expense in connection with such bank's investment in the JW L stockof the Financing Corporation under section 21;

�


text:
Page:United States Statutes at Large Volume 101 Part 1.djvu/631

 PUBLIC LAW 100-86—AUG. 10, 1987

101 STAT. 601

"(B) the Board determines there is an extraordinary need for the member institutions of the bank to receive dividends; and "(C) the bank has reduced all reserves (other than the reserve account required by the first 2 sentences of subsection (a)) to zero, the Board may authorize such bank to declare and pay dividends out of undivided profits (as such term is defined in section 21(d)(7)) or the reserve account required by the first 2 sentences of subsection (a).

Ante, p. 585.

"(2) REQUIREMENTS OF SECTION 21 NOT AFFECTED.—Notwith-

standing any payment of dividends by any Federal Home Loan Bank pursuant to an authorization by the Board under paragraph (1), the applicable provisions of section 21 shall continue to apply with respect to such bank, and to such bank's investment in the Financing Corporation, in the same manner and to the same extent as if such payment had not been made.". (b) CONFORMING AMENDMENT.—Section 402(h) of the National

Housing Act (12 U.S.C. 1725(h)) is amended— (1) by striking out "After the effective date" and inserting in lieu thereof "(1) After the effective date"; and (2) by adding at the end thereof the following new paragraph: "(2) The first three sentences of paragraph (1) shall not apply to stock issued by the Corporation to the Financing Corporation under subsection (b)(l)(A).". (c) LIMITATION ON SPECIAL ASSESSMENT.—Section 404(c) of the National Housing Act (12 U.S.C. 1727(c)) is amended— (1) by striking out "(c) The Corporation" and inserting in lieu thereof "(c)(1) SPECIAL ASSESSMENT.—Subject to paragraph (2),

the Corporation"; and (2) by adding at the end thereof the following new paragraph: "(2) LIMITATIONS ON AMOUNT OP ASSESSMENT.—The amount of any

additional premium assessed by the Corporation against any insured institution under paragraph (1) in any of the following years shall not exceed the amount listed in connection with each such year in the following table (unless the Federal Home Loan Board determines that severe pressures on the Corporation exist which necessitate an infusion of additional funds): The amount of the additional premium "For yean may not exceed: 1987 %8 of 1 percent of the total amount of the accounts of the insured members of such institution; 1988 yi2 of 1 percent of the total amount of the accounts of the insured members of such institution; 1989 Vie of 1 percent of the total amount of the accounts of the insured members of such institution; 1990 V 4 of 1 percent of the total amount of 4 the accounts of the insured members of such institution; 1991 Vis of 1 percent of the total amount of the accounts of the insured members of such institution.". (d) PRIORFTY OF SECURED INTERESTS.—Section 10 of the Federal

Home Loan Bank Act (12 U.S.C. 1430) is amended by adding at the end thereof the following new subsection:

, A

�


text: Dictionary of National Biography, 1885-1900/Patti, Carlotta


text:
Page:United States Statutes at Large Volume 101 Part 1.djvu/632

 101 STAT. 602

PUBLIC LAW 100-86—AUG. 10, 1987 "(e) PRIORITY OF CERTAIN SECURED INTERESTS.—Notwithstanding

?^ 1.: s

any other provision of law, any security interest granted to a Federal Home Loan Bank by any member of any Federal Home Loan Bank or any affiliate of any such member shall be entitled to priority over the claims and rights of any party (including any receiver, conservator, trustee, or similar party having rights of a lien creditor) other than claims and rights that— "(1) would be entitled to priority under otherwise applicable law; and "(2) are held by actual bona fide purchasers for value or by actual secured parties that are secured by actual perfected security interests.". (e) COORDINATION OF TERMINATION ASSESSMENT WITH FINAL INSURANCE PREMIUM.—Section 407(d) of the National Housing Act

(12 U.S.C. 1730(d)) is amended— (1) by striking out "(d)" and inserting in lieu thereof "(d)(1) FINAL INSURANCE PREMIUM"; and

(2) by adding at the end thereof the following new paragraph: "(2) EXCEPTION RELATING TO FINAL INSURANCE PREMIUM.—If an

Ante, p. 585.

institution (whose status as an insured institution is terminated) pays an assessment to the Financing Corporation under section 21(f)(4) of the Federal Home Loan Bank Act with respect to such termination, the institution shall not be obligated to pay the final insurance premium described in the third sentence of paragraph (1).". (f) SECTION 404(f) DOES NOT APPLY TO INSTITUTIONS WHICH CEASE TO BE FSLIC INSURED.—Section 404(f) of the National Housing Act (12 U.S.C. 1727(f)) is amended— (1) by striking out "(f) I f and inserting in lieu thereof "(f)(1) PRO RATA DISTRIBUTION ON TERMINATION OF INSURED STATUS.—

12 USC 1730

I f; and (2) by adding at the end thereof the following new paragraph: "(2) EXCEPTION.—In the case of an institution which— "(A) ceases to be an insured institution; and "(B) is required to pay an assessment to the Financing Corporation under section 21(f)(4) of the Federal Home Loan Bank Act with respect to the termination of such insured status, paragraph (1), the last sentence of subsection (e)(D, and subsection (i)(4) shall not apply with respect to such institution.". (g) SECONDARY RESERVE.—Section 404 of the National Housing Act (12 U.S.C. 1727) is amended by striking out subsection (h). (h) 1-YEAR PROHIBITION ON TERMINATION OF FSLIC INSURED

note.

STATUS.—

(1) IN GENERAL.—No association or insured institution may take any action which would result in the voluntary termination of its status as an insured institution during the 1-year period beginning on the date of the enactment of this Act. (2) EXCEPTION.—Paragraph (1) shall not apply with respect to any association or institution described in section 21(f)(4)(F) of the Federal Home Loan Bank Act (as added by section 302 of this title). (3) AUTHORITY OF FSLIC TO ARRANGE EMERGENCY ACQUISITIONS

12 USC 1729 1730a.

NOT AFFECTED.—Paragraph (1) shall not affect the authority of the Federal Savings and Loan Insurance Corporation to arrange for the acquisition of an association or insured institution under section 406(f) or 408(m) of the National Housing Act.

�


text:
Page:United States Statutes at Large Volume 101 Part 1.djvu/633

 PUBLIC LAW 100-86—AUG. 10, 1987

101 STAT. 603

(4) DEFINITIONS.—For purposes of this subsection— (A) ASSOCIATION.—The term "association" has the meaning given to such term under section 2(d) of the Home Owners' Loan Act of 1933. 12 USC 1462. (B) INSURED INSTITUTION.—The term "insured institution" has the meaning given to such term in section 401(a) of the National Housing Act. 12 USC 1724. (i) FSLIC REPORT REQUIREMENTS.—Section 402 of the National Housing Act is amended by adding at the end thereof the following 12 USC 1725. new subsection: "(k) REPORTS AND BUDGETS REQUIRED.— "(1) QUARTERLY REPORTS AND BUDGETS.—Before the end of the

2-week period beginning on the first day of each calendar quarter, the Corporation shall complete a detailed written report and budget describing and explaining— "(A) planned or anticipated activities and estimates of receipts and expenditures for such calendar quarter; and "(B) the activities, receipts, and expenditures for the preceding calendar quarter. j.

"(2) SEMIANNUAL REPORT.—Before the end of the 30-day

period beginning on the first day of each semiannual period, the Corporation shall complete a detailed written report and budget describing and explaining the activities, receipts, and expenditures for the preceding semiannual period. "(3) SUBMISSION OF SEMIANNUAL REPORT TO CONGRESS.—The

Corporation shall submit a copy of each semiannual report required under paragraph (2) to the Committee on Banlang, Finance and Urban Affairs of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate. "(4) ACTIVITIES, ETC., OF FEDERAL ASSET DISPOSITION ASSOCIA-

TION.—Activities, receipts, and expenditures of the Federal Asset Disposition Association (or any successor thereto) shall be included in any report or budget required under this subsection. "(5) DEFINITIONS.—For purposes of this subsection— "(A) ACTIVITIES.—The term 'activities' includes any activity engaged in with respect to any insured institution in financial difficulty. "(B) SEMIANNUAL PERIOD.—The term 'semiannual period' X):x',; ' means— "(i) the period beginning on January 1 of any cal-ijni. 2i endar year and ending June 30 of such year; and "(ii) the period beginning on July 1 of any calendar year and ending December 31 of such year.". SEC. 307. SECONDARY RESERVE PROVISIONS. (a) OFFSETS AGAINST PREMIUMS AUTHORIZED.—Section 404(e) of the National Housing Act (12 U.S.C. 1727(e)) is amended— (1) by striking out "(e) The Corporation" and inserting in lieu thereof "(e)(1) The Corporation"; and (2) by adding at the end thereof the following new paragraph: "(2) SECONDARY RESERVE OFFSETS AGAINST PREMIUMS.— "(A) OFFSETS IN PREMIUM YEARS BEGINNING BEFORE 1993.—

Subject to the maximum amount limitation contained in subparagraph (B) and notwithstanding any other provision of ,, law, an insured institution may offset such institution's pro rata share of the statutorily prescribed amount against any pre-

)

\

�


text: Dictionary of National Biography, 1885-1900/Pattinson, Hugh Lee


text:
Page:United States Statutes at Large Volume 101 Part 1.djvu/634

 PUBLIC LAW 100-86—AUG. 10, 1987

101 STAT. 604

mium assessed against such insured institution under subsection (c) for any premium year beginning after 1987 and before 1993. "(B) ANNUAL MAXIMUM AMOUNT LIMITATION.—The amount of any offset allowed for any insured institution under subparagraph (A) for any premium year referred to in subparagraph (A) shall not exceed an amount which is equal to 20 percent of such institution's pro rata share of the statutorily prescribed amount (as computed for the calendar year in which such premium year begins). "(C) OFFSETS IN PREMIUM YEARS BEGINNING AFTER 1992.— Notwithstanding any other provision of law, an insured institution may offset such institution's pro rata share of the statutorily prescribed amount against any premium assessed against such insured institution under this section for any premium year beginning after 1992.

•* j' ''

'' "^

•

"(D) STATUTORILY PRESCRIBED AMOUNT DEFINED.—For purposes

of this paragraph, the term 'statutorily prescribed amount' means— "(i) with respect to calendar year 1988, the sum of $823,705,000; and "(ii) with respect to any calendar year beginning after 1988, the sum contained in clause (i) minus the aggregate amount of offsets made by all insured institutions before the beginning of the calendar year for which such computation is being made.

^

"(E) INSURED INSTITUTION'S PRO RATA AMOUNT.—For purposes

"

of this paragraph, an insured institution's pro rata share of the statutorily prescribed amount is the percentage which is equal to such institution's pro rata share of the secondary reserve as determined under this subsection on the day before the date on which the Corporation ceased to recognize the secondary reserve. "(F) PREMIUM YEAR DEFINED.—For purposes of this paragraph, the term 'premium year' means, with respect to any insured institution, the 1-year period for which a premium is assessed against such insured institution under subsection (b) or (c).".

I -

(b) TECHNICAL AND CONFORMING AMENDMENTS.—

(1) Section 404(d)(l) of the National Housing Act (12 U.S.C. 1727(d)) is amended— (A) by striking out the second sentence of subparagraph (A); (B) by striking out paragraph (B); and "'' (C) by striking out "(1)(A)" and inserting in lieu thereof

I

,,,:

•

"(1)".

(2) Section 404(g) of the National Housing Act (12 U.S.C. 1727(g)) is amended by striking out the second sentence.

Thrift Industry Recovery Act

TITLE IV—THRIFT INDUSTRY RECOVERY PROVISIONS

12 USC 226 note. SEC. 401. SHORT TITLE. This title may be cited as the "Thrift Industry Recovery Act".

�


text:
Page:United States Statutes at Large Volume 101 Part 1.djvu/635

 PUBLIC LAW 100-86—AUG. 10, 1987

101 STAT. 605

SEC. 402. THRIFT INSTITUTION ACCOUNTING, APPRAISAL, AND RESERVE STANDARDS.

(a) FEDERALLY CHARTERED THRIFTS.—The Home Owners' Loan Act 12 USC 1468. of 1933 (12 U.S.C. 1461 et seq.) is amended by redesignating section 9 as section 11 and by inserting after section 8 the following new section: "SEC. 9. ACCOUNTING PRINCIPLES REQUIREMENTS.

AND

OTHER

STANDARDS

AND

12 USC 1467.

"(a) IN GENERAL.—The Board shall prescribe regulations which Regulations. make the following provisions applicable to associations for regulatory purposes: "(1) ASSET CLASSIFICATION SYSTEM.—An asset classification system shall be established which is consistent with the asset classification system established by the Federal banking agencies, except that such system shall provide that the principal supervisory agent of the Board for each Federal home losm bank district may, in such agent's discretion— "(A) require an association to create additional general loss reserves on the basis of an evaluation of such institution's assets; or L>.M"(B) determine whether a restructured loan gisset which is in a nonperforming status or with respect to which the borrowers have otherwise failed to remain in compliance with the repayment terms at the time of such restructuring shall be classified. "(2) APPRAISAL STANDARD.—An appraisal standard shall be established which is consistent with the appraisal standard established by the Federal banking agencies. "(3) REAPPRAISAL UPON FORECLOSURE.—Generally accepted Real property. accounting principles shall apply to any reappraisal of the value of property securing any loan or other extension of credit upon any foreclosure on such property by an association (or any other action by the association in lieu of foreclosure). "(4) AUTHORIZING USE OF FASB RESTRUCTURING.—If—

15

FOR TROUBLED DEBT

"(A) an association engages in troubled debt restructuring with respect to any loan by the association; and "(B) the troubled debt restructuring complies with Statement of Financial Accounting Standards Numbered 5 and Statement of Financial Accounting Standards Numbered 15 (as issued by the Financial Accounting Standards Board), regulatory accounting principles shall allow the association to account for the effects of the troubled debt restructuring and to account for such association's investment in the original debt f./ instrument (or other agreement which is subject to such restructuring) in the manner provided in such statements. Vj

"(5) CERTAIN LOAN LOSS RESERVES TREATED AS CAPITAL FOR

x^

CERTAIN PURPOSES.—Any amount which an association holds in any account as a general loss reserve may be treated, at the option of the association, as capital of the sissociation for purposes of determining regulatory capital or regulatory net worth with respect to such association, to the extent such treatment is consistent with the procedures established by the Federal banking agencies, (b) UNIFORM GAAP ACCOUNTING STANDARDS REQUIRED.—

ili^

'•^' '

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