Dodd-Frank Wall Street Reform and Consumer Protection Act

Text from govinfo.gov (text as enacted). Retrieved 2026-10-25.

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

Public Law 111-203
111th Congress

An Act

To promote the financial stability of the United States by improving accountability and transparency in the financial system, to end “too big to fail”, to protect the American taxpayer by ending bailouts, to protect consumers from abusive financial services practices, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) Short Title.--This Act may be cited as the “Dodd-Frank Wall Street Reform and Consumer Protection Act”.

(b) Table of Contents.--The table of contents for this Act is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. Severability.
Sec. 4. Effective date.
Sec. 5. Budgetary effects.
Sec. 6. Antitrust savings clause.

TITLE I--FINANCIAL STABILITY

Sec. 101. Short title.
Sec. 102. Definitions.

Subtitle A--Financial Stability Oversight Council

Sec. 111. Financial Stability Oversight Council established. Sec. 112. Council authority. Sec. 113. Authority to require supervision and regulation of certain nonbank financial companies. Sec. 114. Registration of nonbank financial companies supervised by the Board of Governors. Sec. 115. Enhanced supervision and prudential standards for nonbank financial companies supervised by the Board of Governors and certain bank holding companies. Sec. 116. Reports. Sec. 117. Treatment of certain companies that cease to be bank holding companies. Sec. 118. Council funding. Sec. 119. Resolution of supervisory jurisdictional disputes among member agencies. Sec. 120. Additional standards applicable to activities or practices for financial stability purposes. Sec. 121. Mitigation of risks to financial stability. Sec. 122. GAO Audit of Council. Sec. 123. Study of the effects of size and complexity of financial institutions on capital market efficiency and economic growth.

Subtitle B--Office of Financial Research

Sec. 151. Definitions.
Sec. 152. Office of Financial Research established. Sec. 153. Purpose and duties of the Office. Sec. 154. Organizational structure; responsibilities of primary programmatic units. Sec. 155. Funding. Sec. 156. Transition oversight.

Subtitle C--Additional Board of Governors Authority for Certain Nonbank Financial Companies and Bank Holding Companies

Sec. 161. Reports by and examinations of nonbank financial companies by the Board of Governors. Sec. 162. Enforcement. Sec. 163. Acquisitions. Sec. 164. Prohibition against management interlocks between certain financial companies. Sec. 165. Enhanced supervision and prudential standards for nonbank financial companies supervised by the Board of Governors and certain bank holding companies. Sec. 166. Early remediation requirements. Sec. 167. Affiliations. Sec. 168. Regulations. Sec. 169. Avoiding duplication. Sec. 170. Safe harbor. Sec. 171. Leverage and risk-based capital requirements. Sec. 172. Examination and enforcement actions for insurance and orderly liquidation purposes. Sec. 173. Access to United States financial market by foreign institutions. Sec. 174. Studies and reports on holding company capital requirements. Sec. 175. International policy coordination. Sec. 176. Rule of construction.

TITLE II--ORDERLY LIQUIDATION AUTHORITY

Sec. 201. Definitions.
Sec. 202. Judicial review.
Sec. 203. Systemic risk determination.
Sec. 204. Orderly liquidation of covered financial companies. Sec. 205. Orderly liquidation of covered brokers and dealers. Sec. 206. Mandatory terms and conditions for all orderly liquidation actions. Sec. 207. Directors not liable for acquiescing in appointment of receiver. Sec. 208. Dismissal and exclusion of other actions. Sec. 209. Rulemaking; non-conflicting law. Sec. 210. Powers and duties of the Corporation. Sec. 211. Miscellaneous provisions. Sec. 212. Prohibition of circumvention and prevention of conflicts of interest. Sec. 213. Ban on certain activities by senior executives and directors. Sec. 214. Prohibition on taxpayer funding. Sec. 215. Study on secured creditor haircuts. Sec. 216. Study on bankruptcy process for financial and nonbank financial institutions Sec. 217. Study on international coordination relating to bankruptcy process for nonbank financial institutions

TITLE III--TRANSFER OF POWERS TO THE COMPTROLLER OF THE CURRENCY, THE CORPORATION, AND THE BOARD OF GOVERNORS

Sec. 300. Short title.
Sec. 301. Purposes.
Sec. 302. Definition.

Subtitle A--Transfer of Powers and Duties

Sec. 311. Transfer date.
Sec. 312. Powers and duties transferred.
Sec. 313. Abolishment.
Sec. 314. Amendments to the Revised Statutes.
Sec. 315. Federal information policy.
Sec. 316. Savings provisions.
Sec. 317. References in Federal law to Federal banking agencies. Sec. 318. Funding. Sec. 319. Contracting and leasing authority.

Subtitle B--Transitional Provisions

Sec. 321. Interim use of funds, personnel, and property of the Office of Thrift Supervision. Sec. 322. Transfer of employees. Sec. 323. Property transferred. Sec. 324. Funds transferred. Sec. 325. Disposition of affairs. Sec. 326. Continuation of services.

Sec. 327. Implementation plan and reports.

Subtitle C--Federal Deposit Insurance Corporation

Sec. 331. Deposit insurance reforms.
Sec. 332. Elimination of procyclical assessments. Sec. 333. Enhanced access to information for deposit insurance purposes. Sec. 334. Transition reserve ratio requirements to reflect new assessment base. Sec. 335. Permanent increase in deposit and share insurance. Sec. 336. Management of the Federal Deposit Insurance Corporation.

Subtitle D--Other Matters

Sec. 341. Branching.
Sec. 342. Office of Minority and Women Inclusion. Sec. 343. Insurance of transaction accounts.

Subtitle E--Technical and Conforming Amendments

Sec. 351. Effective date.
Sec. 352. Balanced Budget and Emergency Deficit Control Act of 1985. Sec. 353. Bank Enterprise Act of 1991. Sec. 354. Bank Holding Company Act of 1956. Sec. 355. Bank Holding Company Act Amendments of 1970. Sec. 356. Bank Protection Act of 1968. Sec. 357. Bank Service Company Act. Sec. 358. Community Reinvestment Act of 1977. Sec. 359. Crime Control Act of 1990. Sec. 360. Depository Institution Management Interlocks Act. Sec. 361. Emergency Homeowners' Relief Act. Sec. 362. Federal Credit Union Act. Sec. 363. Federal Deposit Insurance Act. Sec. 364. Federal Home Loan Bank Act. Sec. 365. Federal Housing Enterprises Financial Safety and Soundness Act of 1992. Sec. 366. Federal Reserve Act. Sec. 367. Financial Institutions Reform, Recovery, and Enforcement Act of 1989. Sec. 368. Flood Disaster Protection Act of 1973. Sec. 369. Home Owners' Loan Act. Sec. 370. Housing Act of 1948. Sec. 371. Housing and Community Development Act of 1992. Sec. 372. Housing and Urban-Rural Recovery Act of 1983. Sec. 373. National Housing Act. Sec. 374. Neighborhood Reinvestment Corporation Act. Sec. 375. Public Law 93-100. Sec. 376. Securities Exchange Act of 1934. Sec. 377. Title 18, United States Code. Sec. 378. Title 31, United States Code.

TITLE IV--REGULATION OF ADVISERS TO HEDGE FUNDS AND OTHERS

Sec. 401. Short title.
Sec. 402. Definitions.
Sec. 403. Elimination of private adviser exemption; limited exemption for foreign private advisers; limited intrastate exemption. Sec. 404. Collection of systemic risk data; reports; examinations; disclosures. Sec. 405. Disclosure provision amendment. Sec. 406. Clarification of rulemaking authority. Sec. 407. Exemption of venture capital fund advisers. Sec. 408. Exemption of and record keeping by private equity fund advisers. Sec. 409. Family offices. Sec. 410. State and Federal responsibilities; asset threshold for Federal registration of investment advisers. Sec. 411. Custody of client assets. Sec. 412. Adjusting the accredited investor standard. Sec. 413. GAO study and report on accredited investors. Sec. 414. GAO study on self-regulatory organization for private funds. Sec. 415. Commission study and report on short selling. Sec. 416. Transition period.

TITLE V--INSURANCE

Subtitle A--Office of National Insurance

Sec. 501. Short title.
Sec. 502. Federal Insurance Office.

Subtitle B--State-Based Insurance Reform

Sec. 511. Short title.

Sec. 512. Effective date.

PART I--Nonadmitted Insurance

Sec. 521. Reporting, payment, and allocation of premium taxes. Sec. 522. Regulation of nonadmitted insurance by insured's home State. Sec. 523. Participation in national producer database. Sec. 524. Uniform standards for surplus lines eligibility. Sec. 525. Streamlined application for commercial purchasers. Sec. 526. GAO study of nonadmitted insurance market. Sec. 527. Definitions.

PART II--Reinsurance

Sec. 531. Regulation of credit for reinsurance and reinsurance agreements. Sec. 532. Regulation of reinsurer solvency. Sec. 533. Definitions.

PART III--Rule of Construction

Sec. 541. Rule of construction.
Sec. 542. Severability.

TITLE VI--IMPROVEMENTS TO REGULATION OF BANK AND SAVINGS ASSOCIATION HOLDING COMPANIES AND DEPOSITORY INSTITUTIONS

Sec. 601. Short title.
Sec. 602. Definition.
Sec. 603. Moratorium and study on treatment of credit card banks, industrial loan companies, and certain other companies under the Bank Holding Company Act of 1956. Sec. 604. Reports and examinations of holding companies; regulation of functionally regulated subsidiaries. Sec. 605. Assuring consistent oversight of permissible activities of depository institution subsidiaries of holding companies. Sec. 606. Requirements for financial holding companies to remain well capitalized and well managed. Sec. 607. Standards for interstate acquisitions. Sec. 608. Enhancing existing restrictions on bank transactions with affiliates. Sec. 609. Eliminating exceptions for transactions with financial subsidiaries. Sec. 610. Lending limits applicable to credit exposure on derivative transactions, repurchase agreements, reverse repurchase agreements, and securities lending and borrowing transactions. Sec. 611. Consistent treatment of derivative transactions in lending limits. Sec. 612. Restriction on conversions of troubled banks. Sec. 613. De novo branching into States. Sec. 614. Lending limits to insiders. Sec. 615. Limitations on purchases of assets from insiders. Sec. 616. Regulations regarding capital levels. Sec. 617. Elimination of elective investment bank holding company framework. Sec. 618. Securities holding companies. Sec. 619. Prohibitions on proprietary trading and certain relationships with hedge funds and private equity funds. Sec. 620. Study of bank investment activities. Sec. 621. Conflicts of interest. Sec. 622. Concentration limits on large financial firms. Sec. 623. Interstate merger transactions. Sec. 624. Qualified thrift lenders. Sec. 625. Treatment of dividends by certain mutual holding companies. Sec. 626. Intermediate holding companies. Sec. 627. Interest-bearing transaction accounts authorized. Sec. 628. Credit card bank small business lending.

TITLE VII--WALL STREET TRANSPARENCY AND ACCOUNTABILITY

Sec. 701. Short title.

Subtitle A--Regulation of Over-the-Counter Swaps Markets

PART I--Regulatory Authority

Sec. 711. Definitions.
Sec. 712. Review of regulatory authority.
Sec. 713. Portfolio margining conforming changes. Sec. 714. Abusive swaps. Sec. 715. Authority to prohibit participation in swap activities.

Sec. 716. Prohibition against Federal Government bailouts of swaps entities. Sec. 717. New product approval CFTC--SEC process. Sec. 718. Determining status of novel derivative products. Sec. 719. Studies. Sec. 720. Memorandum.

PART II--Regulation of Swap Markets

Sec. 721. Definitions.
Sec. 722. Jurisdiction.
Sec. 723. Clearing.
Sec. 724. Swaps; segregation and bankruptcy treatment. Sec. 725. Derivatives clearing organizations. Sec. 726. Rulemaking on conflict of interest. Sec. 727. Public reporting of swap transaction data. Sec. 728. Swap data repositories. Sec. 729. Reporting and recordkeeping. Sec. 730. Large swap trader reporting. Sec. 731. Registration and regulation of swap dealers and major swap participants. Sec. 732. Conflicts of interest. Sec. 733. Swap execution facilities. Sec. 734. Derivatives transaction execution facilities and exempt boards of trade. Sec. 735. Designated contract markets. Sec. 736. Margin. Sec. 737. Position limits. Sec. 738. Foreign boards of trade. Sec. 739. Legal certainty for swaps. Sec. 740. Multilateral clearing organizations. Sec. 741. Enforcement. Sec. 742. Retail commodity transactions. Sec. 743. Other authority. Sec. 744. Restitution remedies. Sec. 745. Enhanced compliance by registered entities. Sec. 746. Insider trading. Sec. 747. Antidisruptive practices authority. Sec. 748. Commodity whistleblower incentives and protection. Sec. 749. Conforming amendments. Sec. 750. Study on oversight of carbon markets. Sec. 751. Energy and environmental markets advisory committee. Sec. 752. International harmonization. Sec. 753. Anti-manipulation authority. Sec. 754. Effective date.

Subtitle B--Regulation of Security-Based Swap Markets

Sec. 761. Definitions under the Securities Exchange Act of 1934. Sec. 762. Repeal of prohibition on regulation of security-based swap agreements. Sec. 763. Amendments to the Securities Exchange Act of 1934. Sec. 764. Registration and regulation of security-based swap dealers and major security-based swap participants. Sec. 765. Rulemaking on conflict of interest. Sec. 766. Reporting and recordkeeping. Sec. 767. State gaming and bucket shop laws. Sec. 768. Amendments to the Securities Act of 1933; treatment of security-based swaps. Sec. 769. Definitions under the Investment Company Act of 1940. Sec. 770. Definitions under the Investment Advisers Act of 1940. Sec. 771. Other authority. Sec. 772. Jurisdiction. Sec. 773. Civil penalties. Sec. 774. Effective date.

TITLE VIII--PAYMENT, CLEARING, AND SETTLEMENT SUPERVISION

Sec. 801. Short title.
Sec. 802. Findings and purposes.
Sec. 803. Definitions.
Sec. 804. Designation of systemic importance.
Sec. 805. Standards for systemically important financial market utilities and payment, clearing, or settlement activities. Sec. 806. Operations of designated financial market utilities. Sec. 807. Examination of and enforcement actions against designated financial market utilities. Sec. 808. Examination of and enforcement actions against financial institutions subject to standards for designated activities.

Sec. 809. Requests for information, reports, or records. Sec. 810. Rulemaking. Sec. 811. Other authority. Sec. 812. Consultation. Sec. 813. Common framework for designated clearing entity risk management. Sec. 814. Effective date.

TITLE IX--INVESTOR PROTECTIONS AND IMPROVEMENTS TO THE REGULATION OF SECURITIES

Sec. 901. Short title.

Subtitle A--Increasing Investor Protection

Sec. 911. Investor Advisory Committee established. Sec. 912. Clarification of authority of the Commission to engage in investor testing. Sec. 913. Study and rulemaking regarding obligations of brokers, dealers, and investment advisers. Sec. 914. Study on enhancing investment adviser examinations. Sec. 915. Office of the Investor Advocate. Sec. 916. Streamlining of filing procedures for self-regulatory organizations. Sec. 917. Study regarding financial literacy among investors. Sec. 918. Study regarding mutual fund advertising. Sec. 919. Clarification of Commission authority to require investor disclosures before purchase of investment products and services. Sec. 919A. Study on conflicts of interest. Sec. 919B. Study on improved investor access to information on investment advisers and broker-dealers. Sec. 919C. Study on financial planners and the use of financial designations. Sec. 919D. Ombudsman.

Subtitle B--Increasing Regulatory Enforcement and Remedies

Sec. 921. Authority to restrict mandatory pre-dispute arbitration. Sec. 922. Whistleblower protection. Sec. 923. Conforming amendments for whistleblower protection. Sec. 924. Implementation and transition provisions for whistleblower protection. Sec. 925. Collateral bars. Sec. 926. Disqualifying felons and other “bad actors” from Regulation D offerings. Sec. 927. Equal treatment of self-regulatory organization rules. Sec. 928. Clarification that section 205 of the Investment Advisers Act of 1940 does not apply to State-registered advisers. Sec. 929. Unlawful margin lending. Sec. 929A. Protection for employees of subsidiaries and affiliates of publicly traded companies. Sec. 929B. Fair Fund amendments. Sec. 929C. Increasing the borrowing limit on Treasury loans. Sec. 929D. Lost and stolen securities. Sec. 929E. Nationwide service of subpoenas. Sec. 929F. Formerly associated persons. Sec. 929G. Streamlined hiring authority for market specialists. Sec. 929H. SIPC Reforms. Sec. 929I. Protecting confidentiality of materials submitted to the Commission. Sec. 929J. Expansion of audit information to be produced and exchanged. Sec. 929K. Sharing privileged information with other authorities. Sec. 929L. Enhanced application of antifraud provisions. Sec. 929M. Aiding and abetting authority under the Securities Act and the Investment Company Act. Sec. 929N. Authority to impose penalties for aiding and abetting violations of the Investment Advisers Act. Sec. 929O. Aiding and abetting standard of knowledge satisfied by recklessness. Sec. 929P. Strengthening enforcement by the Commission. Sec. 929Q. Revision to recordkeeping rule. Sec. 929R. Beneficial ownership and short-swing profit reporting. Sec. 929S. Fingerprinting. Sec. 929T. Equal treatment of self-regulatory organization rules. Sec. 929U. Deadline for completing examinations, inspections and enforcement actions. Sec. 929V. Security Investor Protection Act amendments. Sec. 929W. Notice to missing security holders. Sec. 929X. Short sale reforms. Sec. 929Y. Study on extraterritorial private rights of action. Sec. 929Z. GAO study on securities litigation.

Subtitle C--Improvements to the Regulation of Credit Rating Agencies

Sec. 931. Findings.

Sec. 932. Enhanced regulation, accountability, and transparency of nationally recognized statistical rating organizations. Sec. 933. State of mind in private actions. Sec. 934. Referring tips to law enforcement or regulatory authorities. Sec. 935. Consideration of information from sources other than the issuer in rating decisions. Sec. 936. Qualification standards for credit rating analysts. Sec. 937. Timing of regulations. Sec. 938. Universal ratings symbols. Sec. 939. Removal of statutory references to credit ratings. Sec. 939A. Review of reliance on ratings. Sec. 939B. Elimination of exemption from fair disclosure rule. Sec. 939C. Securities and Exchange Commission study on strengthening credit rating agency independence. Sec. 939D. Government Accountability Office study on alternative business models. Sec. 939E. Government Accountability Office study on the creation of an independent professional analyst organization. Sec. 939F. Study and rulemaking on assigned credit ratings. Sec. 939G. Effect of Rule 436(g). Sec. 939H. Sense of Congress.

Subtitle D--Improvements to the Asset-Backed Securitization Process

Sec. 941. Regulation of credit risk retention.
Sec. 942. Disclosures and reporting for asset-backed securities. Sec. 943. Representations and warranties in asset-backed offerings. Sec. 944. Exempted transactions under the Securities Act of 1933. Sec. 945. Due diligence analysis and disclosure in asset-backed securities issues. Sec. 946. Study on the macroeconomic effects of risk retention requirements.

Subtitle E--Accountability and Executive Compensation

Sec. 951. Shareholder vote on executive compensation disclosures. Sec. 952. Compensation committee independence. Sec. 953. Executive compensation disclosures. Sec. 954. Recovery of erroneously awarded compensation. Sec. 955. Disclosure regarding employee and director hedging. Sec. 956. Enhanced compensation structure reporting. Sec. 957. Voting by brokers.

Subtitle F--Improvements to the Management of the Securities and Exchange Commission

Sec. 961. Report and certification of internal supervisory controls. Sec. 962. Triennial report on personnel management. Sec. 963. Annual financial controls audit. Sec. 964. Report on oversight of national securities associations. Sec. 965. Compliance examiners. Sec. 966. Suggestion program for employees of the Commission. Sec. 967. Commission organizational study and reform. Sec. 968. Study on SEC revolving door.

Subtitle G--Strengthening Corporate Governance

Sec. 971. Proxy access.
Sec. 972. Disclosures regarding chairman and CEO structures.

Subtitle H--Municipal Securities

Sec. 975. Regulation of municipal securities and changes to the board of the MSRB. Sec. 976. Government Accountability Office study of increased disclosure to investors. Sec. 977. Government Accountability Office study on the municipal securities markets. Sec. 978. Funding for Governmental Accounting Standards Board. Sec. 979. Commission Office of Municipal Securities.

Subtitle I--Public Company Accounting Oversight Board, Portfolio Margining, and Other Matters

Sec. 981. Authority to share certain information with foreign authorities. Sec. 982. Oversight of brokers and dealers. Sec. 983. Portfolio margining. Sec. 984. Loan or borrowing of securities. Sec. 985. Technical corrections to Federal securities laws. Sec. 986. Conforming amendments relating to repeal of the Public Utility Holding Company Act of 1935.

Sec. 987. Amendment to definition of material loss and nonmaterial losses to the Deposit Insurance Fund for purposes of Inspector General reviews. Sec. 988. Amendment to definition of material loss and nonmaterial losses to the National Credit Union Share Insurance Fund for purposes of Inspector General reviews. Sec. 989. Government Accountability Office study on proprietary trading. Sec. 989A. Senior investor protections. Sec. 989B. Designated Federal entity inspectors general independence. Sec. 989C. Strengthening Inspector General accountability. Sec. 989D. Removal of Inspectors General of designated Federal entities. Sec. 989E. Additional oversight of financial regulatory system. Sec. 989F. GAO study of person to person lending. Sec. 989G. Exemption for nonaccelerated filers. Sec. 989H. Corrective responses by heads of certain establishments to deficiencies identified by Inspectors General. Sec. 989I. GAO study regarding exemption for smaller issuers. Sec. 989J. Further promoting the adoption of the NAIC Model Regulations that enhance protection of seniors and other consumers.

Subtitle J--Securities and Exchange Commission Match Funding

Sec. 991. Securities and Exchange Commission match funding.

TITLE X--BUREAU OF CONSUMER FINANCIAL PROTECTION

Sec. 1001. Short title.
Sec. 1002. Definitions.

Subtitle A--Bureau of Consumer Financial Protection

Sec. 1011. Establishment of the Bureau of Consumer Financial Protection. Sec. 1012. Executive and administrative powers. Sec. 1013. Administration. Sec. 1014. Consumer Advisory Board. Sec. 1015. Coordination. Sec. 1016. Appearances before and reports to Congress. Sec. 1017. Funding; penalties and fines. Sec. 1018. Effective date.

Subtitle B--General Powers of the Bureau

Sec. 1021. Purpose, objectives, and functions.
Sec. 1022. Rulemaking authority.
Sec. 1023. Review of Bureau regulations.
Sec. 1024. Supervision of nondepository covered persons. Sec. 1025. Supervision of very large banks, savings associations, and credit unions. Sec. 1026. Other banks, savings associations, and credit unions. Sec. 1027. Limitations on authorities of the Bureau; preservation of authorities. Sec. 1028. Authority to restrict mandatory pre-dispute arbitration. Sec. 1029. Exclusion for auto dealers. Sec. 1029A. Effective date.

Subtitle C--Specific Bureau Authorities

Sec. 1031. Prohibiting unfair, deceptive, or abusive acts or practices. Sec. 1032. Disclosures. Sec. 1033. Consumer rights to access information. Sec. 1034. Response to consumer complaints and inquiries. Sec. 1035. Private education loan ombudsman. Sec. 1036. Prohibited acts. Sec. 1037. Effective date.

Subtitle D--Preservation of State Law

Sec. 1041. Relation to State law.
Sec. 1042. Preservation of enforcement powers of States. Sec. 1043. Preservation of existing contracts. Sec. 1044. State law preemption standards for national banks and subsidiaries clarified. Sec. 1045. Clarification of law applicable to nondepository institution subsidiaries. Sec. 1046. State law preemption standards for Federal savings associations and subsidiaries clarified. Sec. 1047. Visitorial standards for national banks and savings associations. Sec. 1048. Effective date.

Subtitle E--Enforcement Powers

Sec. 1051. Definitions.

Sec. 1052. Investigations and administrative discovery. Sec. 1053. Hearings and adjudication proceedings. Sec. 1054. Litigation authority. Sec. 1055. Relief available. Sec. 1056. Referrals for criminal proceedings. Sec. 1057. Employee protection. Sec. 1058. Effective date.

Subtitle F--Transfer of Functions and Personnel; Transitional Provisions

Sec. 1061. Transfer of consumer financial protection functions. Sec. 1062. Designated transfer date. Sec. 1063. Savings provisions. Sec. 1064. Transfer of certain personnel. Sec. 1065. Incidental transfers. Sec. 1066. Interim authority of the Secretary. Sec. 1067. Transition oversight.

Subtitle G--Regulatory Improvements

Sec. 1071. Small business data collection.
Sec. 1072. Assistance for economically vulnerable individuals and families. Sec. 1073. Remittance transfers. Sec. 1074. Department of the Treasury study on ending the conservatorship of Fannie Mae, Freddie Mac, and reforming the housing finance system. Sec. 1075. Reasonable fees and rules for payment card transactions. Sec. 1076. Reverse mortgage study and regulations. Sec. 1077. Report on private education loans and private educational lenders. Sec. 1078. Study and report on credit scores. Sec. 1079. Review, report, and program with respect to exchange facilitators. Sec. 1079A. Financial fraud provisions.

Subtitle H--Conforming Amendments

Sec. 1081. Amendments to the Inspector General Act. Sec. 1082. Amendments to the Privacy Act of 1974. Sec. 1083. Amendments to the Alternative Mortgage Transaction Parity Act of 1982. Sec. 1084. Amendments to the Electronic Fund Transfer Act. Sec. 1085. Amendments to the Equal Credit Opportunity Act. Sec. 1086. Amendments to the Expedited Funds Availability Act. Sec. 1087. Amendments to the Fair Credit Billing Act. Sec. 1088. Amendments to the Fair Credit Reporting Act and the Fair and Accurate Credit Transactions Act of 2003. Sec. 1089. Amendments to the Fair Debt Collection Practices Act. Sec. 1090. Amendments to the Federal Deposit Insurance Act. Sec. 1091. Amendment to Federal Financial Institutions Examination Council Act of 1978. Sec. 1092. Amendments to the Federal Trade Commission Act. Sec. 1093. Amendments to the Gramm-Leach-Bliley Act. Sec. 1094. Amendments to the Home Mortgage Disclosure Act of 1975. Sec. 1095. Amendments to the Homeowners Protection Act of 1998. Sec. 1096. Amendments to the Home Ownership and Equity Protection Act of 1994. Sec. 1097. Amendments to the Omnibus Appropriations Act, 2009. Sec. 1098. Amendments to the Real Estate Settlement Procedures Act of 1974. Sec. 1098A. Amendments to the Interstate Land Sales Full Disclosure Act. Sec. 1099. Amendments to the Right to Financial Privacy Act of 1978. Sec. 1100. Amendments to the Secure and Fair Enforcement for Mortgage Licensing Act of 2008. Sec. 1100A. Amendments to the Truth in Lending Act. Sec. 1100B. Amendments to the Truth in Savings Act. Sec. 1100C. Amendments to the Telemarketing and Consumer Fraud and Abuse Prevention Act. Sec. 1100D. Amendments to the Paperwork Reduction Act. Sec. 1100E. Adjustments for inflation in the Truth in Lending Act. Sec. 1100F. Use of consumer reports. Sec. 1100G. Small business fairness and regulatory transparency. Sec. 1100H. Effective date.

TITLE XI--FEDERAL RESERVE SYSTEM PROVISIONS

Sec. 1101. Federal Reserve Act amendments on emergency lending authority. Sec. 1102. Reviews of special Federal reserve credit facilities. Sec. 1103. Public access to information. Sec. 1104. Liquidity event determination.

Sec. 1105. Emergency financial stabilization.
Sec. 1106. Additional related amendments.
Sec. 1107. Federal Reserve Act amendments on Federal reserve bank governance. Sec. 1108. Federal Reserve Act amendments on supervision and regulation policy. Sec. 1109. GAO audit of the Federal Reserve facilities; publication of Board actions.

TITLE XII--IMPROVING ACCESS TO MAINSTREAM FINANCIAL INSTITUTIONS

Sec. 1201. Short title.
Sec. 1202. Purpose.
Sec. 1203. Definitions.
Sec. 1204. Expanded access to mainstream financial institutions. Sec. 1205. Low-cost alternatives to payday loans. Sec. 1206. Grants to establish loan-loss reserve funds. Sec. 1207. Procedural provisions. Sec. 1208. Authorization of appropriations. Sec. 1209. Regulations. Sec. 1210. Evaluation and reports to Congress.

TITLE XIII--PAY IT BACK ACT

Sec. 1301. Short title.
Sec. 1302. Amendment to reduce TARP authorization. Sec. 1303. Report. Sec. 1304. Amendments to Housing and Economic Recovery Act of 2008. Sec. 1305. Federal Housing Finance Agency report. Sec. 1306. Repayment of unobligated ARRA funds.

TITLE XIV--MORTGAGE REFORM AND ANTI-PREDATORY LENDING ACT

Sec. 1400. Short title; designation as enumerated consumer law.

Subtitle A--Residential Mortgage Loan Origination Standards

Sec. 1401. Definitions.
Sec. 1402. Residential mortgage loan origination. Sec. 1403. Prohibition on steering incentives. Sec. 1404. Liability. Sec. 1405. Regulations. Sec. 1406. Study of shared appreciation mortgages.

Subtitle B--Minimum Standards For Mortgages

Sec. 1411. Ability to repay.
Sec. 1412. Safe harbor and rebuttable presumption. Sec. 1413. Defense to foreclosure. Sec. 1414. Additional standards and requirements. Sec. 1415. Rule of construction. Sec. 1416. Amendments to civil liability provisions. Sec. 1417. Lender rights in the context of borrower deception. Sec. 1418. Six-month notice required before reset of hybrid adjustable rate mortgages. Sec. 1419. Required disclosures. Sec. 1420. Disclosures required in monthly statements for residential mortgage loans. Sec. 1421. Report by the GAO. Sec. 1422. State attorney general enforcement authority.

Subtitle C--High-Cost Mortgages

Sec. 1431. Definitions relating to high-cost mortgages. Sec. 1432. Amendments to existing requirements for certain mortgages. Sec. 1433. Additional requirements for certain mortgages.

Subtitle D--Office of Housing Counseling

Sec. 1441. Short title.
Sec. 1442. Establishment of Office of Housing Counseling. Sec. 1443. Counseling procedures. Sec. 1444. Grants for housing counseling assistance. Sec. 1445. Requirements to use HUD-certified counselors under HUD programs. Sec. 1446. Study of defaults and foreclosures. Sec. 1447. Default and foreclosure database. Sec. 1448. Definitions for counseling-related programs. Sec. 1449. Accountability and transparency for grant recipients. Sec. 1450. Updating and simplification of mortgage information booklet.

Sec. 1451. Home inspection counseling.
Sec. 1452. Warnings to homeowners of foreclosure rescue scams.

Subtitle E--Mortgage Servicing

Sec. 1461. Escrow and impound accounts relating to certain consumer credit transactions. Sec. 1462. Disclosure notice required for consumers who waive escrow services. Sec. 1463. Real Estate Settlement Procedures Act of 1974 amendments. Sec. 1464. Truth in Lending Act amendments. Sec. 1465. Escrows included in repayment analysis.

Subtitle F--Appraisal Activities

Sec. 1471. Property appraisal requirements.
Sec. 1472. Appraisal independence requirements.
Sec. 1473. Amendments relating to Appraisal Subcommittee of FFIEC, Appraiser Independence Monitoring, Approved Appraiser Education, Appraisal Management Companies, Appraiser Complaint Hotline, Automated Valuation Models, and Broker Price Opinions. Sec. 1474. Equal Credit Opportunity Act amendment. Sec. 1475. Real Estate Settlement Procedures Act of 1974 amendment relating to certain appraisal fees. Sec. 1476. GAO study on the effectiveness and impact of various appraisal methods, valuation models and distributions channels, and on the Home Valuation Code of conduct and the Appraisal Subcommittee.

Subtitle G--Mortgage Resolution and Modification

Sec. 1481. Multifamily mortgage resolution program. Sec. 1482. Home Affordable Modification Program guidelines. Sec. 1483. Public availability of information of Making Home Affordable Program. Sec. 1484. Protecting tenants at foreclosure extension and clarification.

Subtitle H--Miscellaneous Provisions

Sec. 1491. Sense of Congress regarding the importance of government- sponsored enterprises reform to enhance the protection, limitation, and regulation of the terms of residential mortgage credit. Sec. 1492. GAO study report on government efforts to combat mortgage foreclosure rescue scams and loan modification fraud. Sec. 1493. Reporting of mortgage data by State. Sec. 1494. Study of effect of drywall presence on foreclosures. Sec. 1495. Definition. Sec. 1496. Emergency mortgage relief. Sec. 1497. Additional assistance for Neighborhood Stabilization Program. Sec. 1498. Legal assistance for foreclosure-related issues.

TITLE XV--MISCELLANEOUS PROVISIONS

Sec. 1501. Restrictions on use of United States funds for foreign governments; protection of American taxpayers. Sec. 1502. Conflict minerals. Sec. 1503. Reporting requirements regarding coal or other mine safety. Sec. 1504. Disclosure of payments by resource extraction issuers. Sec. 1505. Study by the Comptroller General. Sec. 1506. Study on core deposits and brokered deposits.

TITLE XVI--SECTION 1256 CONTRACTS

Sec. 1601. Certain swaps, etc., not treated as section 1256 contracts.

SEC. 2. DEFINITIONS.

As used in this Act, the following definitions shall apply, except as the context otherwise requires or as otherwise specifically provided in this Act:
(1) Affiliate.--The term “affiliate” has the same meaning as in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813). (2) Appropriate federal banking agency.--On and after the transfer date, the term “appropriate Federal banking agency” has the same meaning as in section 3(q) of the Federal Deposit Insurance Act (12 U.S.C. 1813(q)), as amended by title III.

(3) Board of governors.--The term “Board of Governors” means the Board of Governors of the Federal Reserve System. (4) Bureau.--The term “Bureau” means the Bureau of Consumer Financial Protection established under title X. (5) Commission.--The term “Commission” means the Securities and Exchange Commission, except in the context of the Commodity Futures Trading Commission. (6) Commodity futures terms.--The terms “futures commission merchant”, “swap”, “swap dealer”, “swap execution facility”, “derivatives clearing organization”, “board of trade”, “commodity trading advisor”, “commodity pool”, and “commodity pool operator” have the same meanings as given the terms in section 1a of the Commodity Exchange Act (7 U.S.C. 1 et seq.). (7) Corporation.--The term “Corporation” means the Federal Deposit Insurance Corporation. (8) Council.--The term “Council” means the Financial Stability Oversight Council established under title I. (9) Credit union.--The term “credit union” means a Federal credit union, State credit union, or State-chartered credit union, as those terms are defined in section 101 of the Federal Credit Union Act (12 U.S.C. 1752). (10) Federal banking agency.--The term-- (A) “Federal banking agency” means, individually, the Board of Governors, the Office of the Comptroller of the Currency, and the Corporation; and (B) “Federal banking agencies” means all of the agencies referred to in subparagraph (A), collectively. (11) Functionally regulated subsidiary.--The term “functionally regulated subsidiary” has the same meaning as in
section 5(c)(5) of the Bank Holding Company Act of 1956 (12
U.S.C. 1844(c)(5)).
(12) Primary financial regulatory agency.--The term “primary financial regulatory agency” means-- (A) the appropriate Federal banking agency, with respect to institutions described in section 3(q) of the Federal Deposit Insurance Act, except to the extent that an institution is or the activities of an institution are otherwise described in subparagraph (B), (C), (D), or (E); (B) the Securities and Exchange Commission, with respect to-- (i) any broker or dealer that is registered with the Commission under the Securities Exchange Act of 1934, with respect to the activities of the broker or dealer that require the broker or dealer to be registered under that Act; (ii) any investment company that is registered with the Commission under the Investment Company Act of 1940, with respect to the activities of the investment company that require the investment company to be registered under that Act; (iii) any investment adviser that is registered with the Commission under the Investment Advisers Act of 1940, with respect to the investment advisory activities of such company and activities that are incidental to such advisory activities;

(iv) any clearing agency registered with the Commission under the Securities Exchange Act of 1934, with respect to the activities of the clearing agency that require the agency to be registered under such Act; (v) any nationally recognized statistical rating organization registered with the Commission under the Securities Exchange Act of 1934; (vi) any transfer agent registered with the Commission under the Securities Exchange Act of 1934; (vii) any exchange registered as a national securities exchange with the Commission under the Securities Exchange Act of 1934; (viii) any national securities association registered with the Commission under the Securities Exchange Act of 1934; (ix) any securities information processor registered with the Commission under the Securities Exchange Act of 1934; (x) the Municipal Securities Rulemaking Board established under the Securities Exchange Act of 1934; (xi) the Public Company Accounting Oversight Board established under the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7211 et seq.); (xii) the Securities Investor Protection Corporation established under the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.); and (xiii) any security-based swap execution facility, security-based swap data repository, security-based swap dealer or major security-based swap participant registered with the Commission under the Securities Exchange Act of 1934, with respect to the security-based swap activities of the person that require such person to be registered under such Act; (C) the Commodity Futures Trading Commission, with respect to-- (i) any futures commission merchant registered with the Commodity Futures Trading Commission under the Commodity Exchange Act (7 U.S.C. 1 et seq.), with respect to the activities of the futures commission merchant that require the futures commission merchant to be registered under that Act; (ii) any commodity pool operator registered with the Commodity Futures Trading Commission under the Commodity Exchange Act (7 U.S.C. 1 et seq.), with respect to the activities of the commodity pool operator that require the commodity pool operator to be registered under that Act, or a commodity pool, as defined in that Act; (iii) any commodity trading advisor or introducing broker registered with the Commodity Futures Trading Commission under the Commodity Exchange Act (7 U.S.C. 1 et seq.), with respect to the activities of the commodity trading advisor or introducing broker that require the commodity trading adviser or introducing broker to be registered under that Act;

(iv) any derivatives clearing organization registered with the Commodity Futures Trading Commission under the Commodity Exchange Act (7 U.S.C. 1 et seq.), with respect to the activities of the derivatives clearing organization that require the derivatives clearing organization to be registered under that Act; (v) any board of trade designated as a contract market by the Commodity Futures Trading Commission under the Commodity Exchange Act (7 U.S.C. 1 et seq.); (vi) any futures association registered with the Commodity Futures Trading Commission under the Commodity Exchange Act (7 U.S.C. 1 et seq.); (vii) any retail foreign exchange dealer registered with the Commodity Futures Trading Commission under the Commodity Exchange Act (7 U.S.C. 1 et seq.), with respect to the activities of the retail foreign exchange dealer that require the retail foreign exchange dealer to be registered under that Act; (viii) any swap execution facility, swap data repository, swap dealer, or major swap participant registered with the Commodity Futures Trading Commission under the Commodity Exchange Act (7 U.S.C. 1 et seq.) with respect to the swap activities of the person that require such person to be registered under that Act; and (ix) any registered entity under the Commodity Exchange Act (7 U.S.C. 1 et seq.), with respect to the activities of the registered entity that require the registered entity to be registered under that Act; (D) the State insurance authority of the State in which an insurance company is domiciled, with respect to the insurance activities and activities that are incidental to such insurance activities of an insurance company that is subject to supervision by the State insurance authority under State insurance law; and (E) the Federal Housing Finance Agency, with respect to Federal Home Loan Banks or the Federal Home Loan Bank System, and with respect to the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation. (13) Prudential standards.--The term “prudential standards” means enhanced supervision and regulatory standards developed by the Board of Governors under section 165. (14) Secretary.--The term “Secretary” means the Secretary of the Treasury. (15) Securities terms.--The-- (A) terms “broker”, “dealer”, “issuer”, “nationally recognized statistical rating organization”, “security”, and “securities laws” have the same meanings as in section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c); (B) term “investment adviser” has the same meaning as in section 202 of the Investment Advisers Act of 1940 (15 U.S.C. 80b-2); and (C) term “investment company” has the same meaning as in section 3 of the Investment Company Act of 1940 (15 U.S.C. 80a-3).

(16) State.--The term “State” means any State, commonwealth, territory, or possession of the United States, the District of Columbia, the Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana Islands, American Samoa, Guam, or the United States Virgin Islands. (17) Transfer date.--The term “transfer date” means the date established under section 311. (18) Other incorporated definitions.-- (A) Federal deposit insurance act.--The terms “bank”, “bank holding company”, “control”, “deposit”, “depository institution”, “Federal depository institution”, “Federal savings association”, “foreign bank”, “including”, “insured branch”, “insured depository institution”, “national member bank”, “national nonmember bank”, “savings association”, “State bank”, “State depository institution”, “State member bank”, “State nonmember bank”, “State savings association”, and “subsidiary” have the same meanings as in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813). (B) Holding companies.--The term-- (i) “bank holding company” has the same meaning as in section 2 of the Bank Holding Company Act of 1956 (12 U.S.C. 1841); (ii) “financial holding company” has the same meaning as in section 2(p) of the Bank Holding Company Act of 1956 (12 U.S.C. 1841(p)); and (iii) “savings and loan holding company” has the same meaning as in section 10 of the Home Owners' Loan Act (12 U.S.C. 1467a(a)). SEC. 3. SEVERABILITY.

If any provision of this Act, an amendment made by this Act, or the application of such provision or amendment to any person or circumstance is held to be unconstitutional, the remainder of this Act, the amendments made by this Act, and the application of the provisions of such to any person or circumstance shall not be affected thereby. SEC. 4. EFFECTIVE DATE.

Except as otherwise specifically provided in this Act or the amendments made by this Act, this Act and such amendments shall take effect 1 day after the date of enactment of this Act. SEC. 5. BUDGETARY EFFECTS.

The budgetary effects of this Act, for the purpose of complying with the Statutory Pay-As-You-Go-Act of 2010, shall be determined by reference to the latest statement titled “Budgetary Effects of PAYGO Legislation” for this Act, jointly submitted for printing in the Congressional Record by the Chairmen of the House and Senate Budget Committees, provided that such statement has been submitted prior to the vote on passage in the House acting first on this conference report or amendment between the Houses. SEC. 6. ANTITRUST SAVINGS CLAUSE.

Nothing in this Act, or any amendment made by this Act, shall be construed to modify, impair, or supersede the operation of any of the antitrust laws, unless otherwise specified. For purposes of this section, the term “antitrust laws” has the same meaning

as in subsection (a) of the first section of the Clayton Act, except that such term includes section 5 of the Federal Trade Commission Act, to the extent that such section 5 applies to unfair methods of competition.

TITLE I-- FINANCIAL STABILITY
SEC. 101. SHORT TITLE.

This title may be cited as the “Financial Stability Act of 2010”. SEC. 102. DEFINITIONS.

(a) In General.--For purposes of this title, unless the context otherwise requires, the following definitions shall apply:
(1) Bank holding company.--The term “bank holding company” has the same meaning as in section 2 of the Bank Holding Company Act of 1956 (12 U.S.C. 1841). A foreign bank or company that is treated as a bank holding company for purposes of the Bank Holding Company Act of 1956, pursuant to section 8(a) of the International Banking Act of 1978 (12 U.S.C. 3106(a)), shall be treated as a bank holding company for purposes of this title. (2) Chairperson.--The term “Chairperson” means the Chairperson of the Council. (3) Member agency.--The term “member agency” means an agency represented by a voting member of the Council. (4) Nonbank financial company definitions.-- (A) Foreign nonbank financial company.--The term “foreign nonbank financial company” means a company (other than a company that is, or is treated in the United States as, a bank holding company) that is-- (i) incorporated or organized in a country other than the United States; and (ii) predominantly engaged in, including through a branch in the United States, financial activities, as defined in paragraph (6). (B) U.S. nonbank financial company.--The term “U.S. nonbank financial company” means a company (other than a bank holding company, a Farm Credit System institution chartered and subject to the provisions of the Farm Credit Act of 1971 (12 U.S.C. 2001 et seq.), or a national securities exchange (or parent thereof), clearing agency (or parent thereof, unless the parent is a bank holding company), security-based swap execution facility, or security-based swap data repository registered with the Commission, or a board of trade designated as a contract market (or parent thereof), or a derivatives clearing organization (or parent thereof, unless the parent is a bank holding company), swap execution facility or a swap data repository registered with the Commodity Futures Trading Commission), that is-- (i) incorporated or organized under the laws of the United States or any State; and (ii) predominantly engaged in financial activities, as defined in paragraph (6).

(C) Nonbank financial company.--The term “nonbank financial company” means a U.S. nonbank financial company and a foreign nonbank financial company. (D) Nonbank financial company supervised by the board of governors.--The term “nonbank financial company supervised by the Board of Governors” means a nonbank financial company that the Council has determined under section 113 shall be supervised by the Board of Governors. (5) Office of financial research.--The term “Office of Financial Research” means the office established under section 152. (6) Predominantly engaged.--A company is “predominantly engaged in financial activities” if-- (A) the annual gross revenues derived by the company and all of its subsidiaries from activities that are financial in nature (as defined in section 4(k) of the Bank Holding Company Act of 1956) and, if applicable, from the ownership or control of one or more insured depository institutions, represents 85 percent or more of the consolidated annual gross revenues of the company; or (B) the consolidated assets of the company and all of its subsidiaries related to activities that are financial in nature (as defined in section 4(k) of the Bank Holding Company Act of 1956) and, if applicable, related to the ownership or control of one or more insured depository institutions, represents 85 percent or more of the consolidated assets of the company. (7) Significant institutions.--The terms “significant nonbank financial company” and “significant bank holding company” have the meanings given those terms by rule of the Board of Governors, but in no instance shall the term “significant nonbank financial company” include those entities that are excluded under paragraph (4)(B).

(b) Definitional Criteria.--The Board of Governors shall establish, by regulation, the requirements for determining if a company is predominantly engaged in financial activities, as defined in subsection (a)(6).

(c) Foreign Nonbank Financial Companies.--For purposes of the application of subtitles A and C (other than section 113(b)) with respect to a foreign nonbank financial company, references in this title to “company” or “subsidiary” include only the United States activities and subsidiaries of such foreign company, except as otherwise provided.

Subtitle A--Financial Stability Oversight Council

SEC. 111. FINANCIAL STABILITY OVERSIGHT COUNCIL ESTABLISHED.

(a) Establishment.--Effective on the date of enactment of this Act, there is established the Financial Stability Oversight Council.

(b) Membership.--The Council shall consist of the following members:
(1) Voting members.--The voting members, who shall each have 1 vote on the Council shall be--

(A) the Secretary of the Treasury, who shall serve as Chairperson of the Council; (B) the Chairman of the Board of Governors; (C) the Comptroller of the Currency; (D) the Director of the Bureau; (E) the Chairman of the Commission; (F) the Chairperson of the Corporation; (G) the Chairperson of the Commodity Futures Trading Commission; (H) the Director of the Federal Housing Finance Agency; (I) the Chairman of the National Credit Union Administration Board; and (J) an independent member appointed by the President, by and with the advice and consent of the Senate, having insurance expertise. (2) Nonvoting members.--The nonvoting members, who shall serve in an advisory capacity as a nonvoting member of the Council, shall be-- (A) the Director of the Office of Financial Research; (B) the Director of the Federal Insurance Office; (C) a State insurance commissioner, to be designated by a selection process determined by the State insurance commissioners; (D) a State banking supervisor, to be designated by a selection process determined by the State banking supervisors; and (E) a State securities commissioner (or an officer performing like functions), to be designated by a selection process determined by such State securities commissioners. (3) Nonvoting member participation.--The nonvoting members of the Council shall not be excluded from any of the proceedings, meetings, discussions, or deliberations of the Council, except that the Chairperson may, upon an affirmative vote of the member agencies, exclude the nonvoting members from any of the proceedings, meetings, discussions, or deliberations of the Council when necessary to safeguard and promote the free exchange of confidential supervisory information.

(c) Terms; Vacancy.--
(1) Terms.--The independent member of the Council shall serve for a term of 6 years, and each nonvoting member described in subparagraphs (C), (D), and (E) of subsection (b)(2) shall serve for a term of 2 years. (2) Vacancy.--Any vacancy on the Council shall be filled in the manner in which the original appointment was made. (3) Acting officials may serve.--In the event of a vacancy in the office of the head of a member agency or department, and pending the appointment of a successor, or during the absence or disability of the head of a member agency or department, the acting head of the member agency or department shall serve as a member of the Council in the place of that agency or department head.

(d) Technical and Professional Advisory Committees.--The Council may appoint such special advisory, technical, or professional committees as may be useful in carrying out the functions of the Council, including an advisory committee consisting of State

regulators, and the members of such committees may be members of the Council, or other persons, or both. (e) Meetings.-- (1) Timing.--The Council shall meet at the call of the Chairperson or a majority of the members then serving, but not less frequently than quarterly. (2) Rules for conducting business.--The Council shall adopt such rules as may be necessary for the conduct of the business of the Council. Such rules shall be rules of agency organization, procedure, or practice for purposes of section 553 of title 5, United States Code.

(f) Voting.--Unless otherwise specified, the Council shall make all decisions that it is authorized or required to make by a majority vote of the voting members then serving. (g) Nonapplicability of FACA.-- The Federal Advisory Committee Act (5 U.S.C. App.) shall not apply to the Council, or to any special advisory, technical, or professional committee appointed by the Council, except that, if an advisory, technical, or professional committee has one or more members who are not employees of or affiliated with the United States Government, the Council shall publish a list of the names of the members of such committee.

(h) Assistance From Federal Agencies.--Any department or agency of the United States may provide to the Council and any special advisory, technical, or professional committee appointed by the Council, such services, funds, facilities, staff, and other support services as the Council may determine advisable. (i) Compensation of Members.-- (1) Federal employee members.--All members of the Council who are officers or employees of the United States shall serve without compensation in addition to that received for their services as officers or employees of the United States. (2) Compensation for non-federal member.--Section 5314 of title 5, United States Code, is amended by adding at the end the following:
“Independent Member of the Financial Stability Oversight Council (1).”.

(j) Detail of Government Employees.--Any employee of the Federal Government may be detailed to the Council without reimbursement, and such detail shall be without interruption or loss of civil service status or privilege. An employee of the Federal Government detailed to the Council shall report to and be subject to oversight by the Council during the assignment to the Council, and shall be compensated by the department or agency from which the employee was detailed. SEC. 112. COUNCIL AUTHORITY.

(a) Purposes and Duties of the Council.-- (1) In general.--The purposes of the Council are-- (A) to identify risks to the financial stability of the United States that could arise from the material financial distress or failure, or ongoing activities, of large, interconnected bank holding companies or nonbank financial companies, or that could arise outside the financial services marketplace; (B) to promote market discipline, by eliminating expectations on the part of shareholders, creditors, and

counterparties of such companies that the Government will shield them from losses in the event of failure; and (C) to respond to emerging threats to the stability of the United States financial system. (2) Duties.--The Council shall, in accordance with this title-- (A) collect information from member agencies, other Federal and State financial regulatory agencies, the Federal Insurance Office and, if necessary to assess risks to the United States financial system, direct the Office of Financial Research to collect information from bank holding companies and nonbank financial companies; (B) provide direction to, and request data and analyses from, the Office of Financial Research to support the work of the Council; (C) monitor the financial services marketplace in order to identify potential threats to the financial stability of the United States; (D) to monitor domestic and international financial regulatory proposals and developments, including insurance and accounting issues, and to advise Congress and make recommendations in such areas that will enhance the integrity, efficiency, competitiveness, and stability of the U.S. financial markets; (E) facilitate information sharing and coordination among the member agencies and other Federal and State agencies regarding domestic financial services policy development, rulemaking, examinations, reporting requirements, and enforcement actions; (F) recommend to the member agencies general supervisory priorities and principles reflecting the outcome of discussions among the member agencies; (G) identify gaps in regulation that could pose risks to the financial stability of the United States; (H) require supervision by the Board of Governors for nonbank financial companies that may pose risks to the financial stability of the United States in the event of their material financial distress or failure, or because of their activities pursuant to section 113; (I) make recommendations to the Board of Governors concerning the establishment of heightened prudential standards for risk-based capital, leverage, liquidity, contingent capital, resolution plans and credit exposure reports, concentration limits, enhanced public disclosures, and overall risk management for nonbank financial companies and large, interconnected bank holding companies supervised by the Board of Governors; (J) identify systemically important financial market utilities and payment, clearing, and settlement activities (as that term is defined in title VIII); (K) make recommendations to primary financial regulatory agencies to apply new or heightened standards and safeguards for financial activities or practices that could create or increase risks of significant liquidity, credit, or other problems spreading among bank holding companies, nonbank financial companies, and United States financial markets;

(L) review and, as appropriate, may submit comments to the Commission and any standard-setting body with respect to an existing or proposed accounting principle, standard, or procedure; (M) provide a forum for-- (i) discussion and analysis of emerging market developments and financial regulatory issues; and (ii) resolution of jurisdictional disputes among the members of the Council; and (N) annually report to and testify before Congress on-- (i) the activities of the Council; (ii) significant financial market and regulatory developments, including insurance and accounting regulations and standards, along with an assessment of those developments on the stability of the financial system; (iii) potential emerging threats to the financial stability of the United States; (iv) all determinations made under section 113 or title VIII, and the basis for such determinations; (v) all recommendations made under section 119 and the result of such recommendations; and (vi) recommendations-- (I) to enhance the integrity, efficiency, competitiveness, and stability of United States financial markets; (II) to promote market discipline; and (III) to maintain investor confidence.

(b) Statements by Voting Members of the Council.--At the time at which each report is submitted under subsection (a), each voting member of the Council shall-- (1) if such member believes that the Council, the Government, and the private sector are taking all reasonable steps to ensure financial stability and to mitigate systemic risk that would negatively affect the economy, submit a signed statement to Congress stating such belief; or (2) if such member does not believe that all reasonable steps described under paragraph (1) are being taken, submit a signed statement to Congress stating what actions such member believes need to be taken in order to ensure that all reasonable steps described under paragraph (1) are taken.

(c) Testimony by the Chairperson.--The Chairperson shall appear before the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate at an annual hearing, after the report is submitted under subsection (a)-- (1) to discuss the efforts, activities, objectives, and plans of the Council; and (2) to discuss and answer questions concerning such report.

(d) Authority To Obtain Information.-- (1) In general.--The Council may receive, and may request the submission of, any data or information from the Office of Financial Research, member agencies, and the Federal Insurance Office, as necessary-- (A) to monitor the financial services marketplace to identify potential risks to the financial stability of the United States; or

(B) to otherwise carry out any of the provisions of this title. (2) Submissions by the office and member agencies.-- Notwithstanding any other provision of law, the Office of Financial Research, any member agency, and the Federal Insurance Office, are authorized to submit information to the Council. (3) Financial data collection.-- (A) In general.--The Council, acting through the Office of Financial Research, may require the submission of periodic and other reports from any nonbank financial company or bank holding company for the purpose of assessing the extent to which a financial activity or financial market in which the nonbank financial company or bank holding company participates, or the nonbank financial company or bank holding company itself, poses a threat to the financial stability of the United States. (B) Mitigation of report burden.--Before requiring the submission of reports from any nonbank financial company or bank holding company that is regulated by a member agency or any primary financial regulatory agency, the Council, acting through the Office of Financial Research, shall coordinate with such agencies and shall, whenever possible, rely on information available from the Office of Financial Research or such agencies. (C) Mitigation in case of foreign financial companies.--Before requiring the submission of reports from a company that is a foreign nonbank financial company or foreign-based bank holding company, the Council shall, acting through the Office of Financial Research, to the extent appropriate, consult with the appropriate foreign regulator of such company and, whenever possible, rely on information already being collected by such foreign regulator, with English translation. (4) Back-up examination by the board of governors.--If the Council is unable to determine whether the financial activities of a U.S. nonbank financial company pose a threat to the financial stability of the United States, based on information or reports obtained under paragraphs (1) and (3), discussions with management, and publicly available information, the Council may request the Board of Governors, and the Board of Governors is authorized, to conduct an examination of the U.S. nonbank financial company for the sole purpose of determining whether the nonbank financial company should be supervised by the Board of Governors for purposes of this title. (5) Confidentiality.-- (A) In general.--The Council, the Office of Financial Research, and the other member agencies shall maintain the confidentiality of any data, information, and reports submitted under this title. (B) Retention of privilege.--The submission of any nonpublicly available data or information under this subsection and subtitle B shall not constitute a waiver of, or otherwise affect, any privilege arising under Federal or State law (including the rules of any Federal or State court) to which the data or information is otherwise subject.

(C) Freedom of information act.--
Section 552 of title 5, United
States Code, including the exceptions thereunder, shall apply to any data or information submitted under this subsection and subtitle B. SEC. 113. AUTHORITY TO REQUIRE SUPERVISION AND REGULATION OF CERTAIN NONBANK FINANCIAL COMPANIES.

(a) U.S. Nonbank Financial Companies Supervised by the Board of Governors.-- (1) Determination.--The Council, on a nondelegable basis and by a vote of not fewer than \2/3\ of the voting members then serving, including an affirmative vote by the Chairperson, may determine that a U.S. nonbank financial company shall be supervised by the Board of Governors and shall be subject to prudential standards, in accordance with this title, if the Council determines that material financial distress at the U.S. nonbank financial company, or the nature, scope, size, scale, concentration, interconnectedness, or mix of the activities of the U.S. nonbank financial company, could pose a threat to the financial stability of the United States. (2) Considerations.--In making a determination under paragraph (1), the Council shall consider-- (A) the extent of the leverage of the company; (B) the extent and nature of the off-balance-sheet exposures of the company; (C) the extent and nature of the transactions and relationships of the company with other significant nonbank financial companies and significant bank holding companies; (D) the importance of the company as a source of credit for households, businesses, and State and local governments and as a source of liquidity for the United States financial system; (E) the importance of the company as a source of credit for low-income, minority, or underserved communities, and the impact that the failure of such company would have on the availability of credit in such communities; (F) the extent to which assets are managed rather than owned by the company, and the extent to which ownership of assets under management is diffuse; (G) the nature, scope, size, scale, concentration, interconnectedness, and mix of the activities of the company; (H) the degree to which the company is already regulated by 1 or more primary financial regulatory agencies; (I) the amount and nature of the financial assets of the company; (J) the amount and types of the liabilities of the company, including the degree of reliance on short-term funding; and (K) any other risk-related factors that the Council deems appropriate.

(b) Foreign Nonbank Financial Companies Supervised by the Board of Governors.-- (1) Determination.--The Council, on a nondelegable basis and by a vote of not fewer than \2/3\ of the voting members then serving, including an affirmative vote by the Chairperson,

may determine that a foreign nonbank financial company shall be supervised by the Board of Governors and shall be subject to prudential standards, in accordance with this title, if the Council determines that material financial distress at the foreign nonbank financial company, or the nature, scope, size, scale, concentration, interconnectedness, or mix of the activities of the foreign nonbank financial company, could pose a threat to the financial stability of the United States. (2) Considerations.--In making a determination under paragraph (1), the Council shall consider-- (A) the extent of the leverage of the company; (B) the extent and nature of the United States related off-balance-sheet exposures of the company; (C) the extent and nature of the transactions and relationships of the company with other significant nonbank financial companies and significant bank holding companies; (D) the importance of the company as a source of credit for United States households, businesses, and State and local governments and as a source of liquidity for the United States financial system; (E) the importance of the company as a source of credit for low-income, minority, or underserved communities in the United States, and the impact that the failure of such company would have on the availability of credit in such communities; (F) the extent to which assets are managed rather than owned by the company and the extent to which ownership of assets under management is diffuse; (G) the nature, scope, size, scale, concentration, interconnectedness, and mix of the activities of the company; (H) the extent to which the company is subject to prudential standards on a consolidated basis in its home country that are administered and enforced by a comparable foreign supervisory authority; (I) the amount and nature of the United States financial assets of the company; (J) the amount and nature of the liabilities of the company used to fund activities and operations in the United States, including the degree of reliance on short-term funding; and (K) any other risk-related factors that the Council deems appropriate.

(c) Antievasion.--
(1) Determinations.--In order to avoid evasion of this title, the Council, on its own initiative or at the request of the Board of Governors, may determine, on a nondelegable basis and by a vote of not fewer than \2/3\ of the voting members then serving, including an affirmative vote by the Chairperson, that-- (A) material financial distress related to, or the nature, scope, size, scale, concentration, interconnectedness, or mix of, the financial activities conducted directly or indirectly by a company incorporated or organized under the laws of the United States or any State or the financial activities in the United States of a company incorporated or organized in a country other than the United States would

pose a threat to the financial stability of the United States, based on consideration of the factors in subsection (a)(2) or (b)(2), as applicable; (B) the company is organized or operates in such a manner as to evade the application of this title; and (C) such financial activities of the company shall be supervised by the Board of Governors and subject to prudential standards in accordance with this title, consistent with paragraph (3). (2) Report.--Upon making a determination under paragraph (1), the Council shall submit a report to the appropriate committees of Congress detailing the reasons for making such determination. (3) Consolidated supervision of only financial activities; establishment of an intermediate holding company.-- (A) Establishment of an intermediate holding company.--Upon a determination under paragraph (1), the company that is the subject of the determination may establish an intermediate holding company in which the financial activities of such company and its subsidiaries shall be conducted (other than the activities described in section 167(b)(2)) in compliance with any regulations or guidance provided by the Board of Governors. Such intermediate holding company shall be subject to the supervision of the Board of Governors and to prudential standards under this title as if the intermediate holding company were a nonbank financial company supervised by the Board of Governors. (B) Action of the board of governors.--To facilitate the supervision of the financial activities subject to the determination in paragraph (1), the Board of Governors may require a company to establish an intermediate holding company, as provided for in section 167, which would be subject to the supervision of the Board of Governors and to prudential standards under this title, as if the intermediate holding company were a nonbank financial company supervised by the Board of Governors. (4) Notice and opportunity for hearing and final determination; judicial review.-- Subsections (d) through (h) shall apply to determinations made by the Council pursuant to paragraph (1) in the same manner as such subsections apply to nonbank financial companies. (5) Covered financial activities.--For purposes of this subsection, the term “financial activities”-- (A) means activities that are financial in nature (as defined in section 4(k) of the Bank Holding Company Act of 1956); (B) includes the ownership or control of one or more insured depository institutions; and (C) does not include internal financial activities conducted for the company or any affiliate thereof, including internal treasury, investment, and employee benefit functions. (6) Only financial activities subject to prudential supervision.--Nonfinancial activities of the company shall not

be subject to supervision by the Board of Governors and prudential standards of the Board. For purposes of this Act, the financial activities that are the subject of the determination in paragraph (1) shall be subject to the same requirements as a nonbank financial company supervised by the Board of Governors. Nothing in this paragraph shall prohibit or limit the authority of the Board of Governors to apply prudential standards under this title to the financial activities that are subject to the determination in paragraph (1).

(d) Reevaluation and Rescission.--The Council shall-- (1) not less frequently than annually, reevaluate each determination made under subsections (a) and (b) with respect to such nonbank financial company supervised by the Board of Governors; and (2) rescind any such determination, if the Council, by a vote of not fewer than \2/3\ of the voting members then serving, including an affirmative vote by the Chairperson, determines that the nonbank financial company no longer meets the standards under subsection (a) or (b), as applicable.

(e) Notice and Opportunity for Hearing and Final Determination.-- (1) In general.--The Council shall provide to a nonbank financial company written notice of a proposed determination of the Council, including an explanation of the basis of the proposed determination of the Council, that a nonbank financial company shall be supervised by the Board of Governors and shall be subject to prudential standards in accordance with this title. (2) Hearing.--Not later than 30 days after the date of receipt of any notice of a proposed determination under paragraph (1), the nonbank financial company may request, in writing, an opportunity for a written or oral hearing before the Council to contest the proposed determination. Upon receipt of a timely request, the Council shall fix a time (not later than 30 days after the date of receipt of the request) and place at which such company may appear, personally or through counsel, to submit written materials (or, at the sole discretion of the Council, oral testimony and oral argument). (3) Final determination.--Not later than 60 days after the date of a hearing under paragraph (2), the Council shall notify the nonbank financial company of the final determination of the Council, which shall contain a statement of the basis for the decision of the Council. (4) No hearing requested.--If a nonbank financial company does not make a timely request for a hearing, the Council shall notify the nonbank financial company, in writing, of the final determination of the Council under subsection (a) or (b), as applicable, not later than 10 days after the date by which the company may request a hearing under paragraph (2).

(f) Emergency Exception.--
(1) In general.--The Council may waive or modify the requirements of subsection (e) with respect to a nonbank financial company, if the Council determines, by a vote of not fewer than \2/3\ of the voting members then serving, including an affirmative vote by the Chairperson, that such waiver or modification is necessary or appropriate to prevent or mitigate

threats posed by the nonbank financial company to the financial stability of the United States. (2) Notice.--The Council shall provide notice of a waiver or modification under this subsection to the nonbank financial company concerned as soon as practicable, but not later than 24 hours after the waiver or modification is granted. (3) International coordination.-- In making a determination under paragraph (1), the Council shall consult with the appropriate home country supervisor, if any, of the foreign nonbank financial company that is being considered for such a determination. (4) Opportunity for hearing.--The Council shall allow a nonbank financial company to request, in writing, an opportunity for a written or oral hearing before the Council to contest a waiver or modification under this subsection, not later than 10 days after the date of receipt of notice of the waiver or modification by the company. Upon receipt of a timely request, the Council shall fix a time (not later than 15 days after the date of receipt of the request) and place at which the nonbank financial company may appear, personally or through counsel, to submit written materials (or, at the sole discretion of the Council, oral testimony and oral argument). (5) Notice of final determination.--Not later than 30 days after the date of any hearing under paragraph (4), the Council shall notify the subject nonbank financial company of the final determination of the Council under this subsection, which shall contain a statement of the basis for the decision of the Council.

(g) Consultation.--The Council shall consult with the primary financial regulatory agency, if any, for each nonbank financial company or subsidiary of a nonbank financial company that is being considered for supervision by the Board of Governors under this section before the Council makes any final determination with respect to such nonbank financial company under subsection (a), (b), or (c). (h) Judicial Review.--If the Council makes a final determination under this section with respect to a nonbank financial company, such nonbank financial company may, not later than 30 days after the date of receipt of the notice of final determination under subsection (d)(2), (e)(3), or (f)(5), bring an action in the United States district court for the judicial district in which the home office of such nonbank financial company is located, or in the United States District Court for the District of Columbia, for an order requiring that the final determination be rescinded, and the court shall, upon review, dismiss such action or direct the final determination to be rescinded. Review of such an action shall be limited to whether the final determination made under this section was arbitrary and capricious.

(i) International Coordination.-- In exercising its duties under this title with respect to foreign nonbank financial companies, foreign-based bank holding companies, and cross-border activities and markets, the Council shall consult with appropriate foreign regulatory authorities, to the extent appropriate.

SEC. 114. REGISTRATION OF NONBANK FINANCIAL COMPANIES SUPERVISED BY THE BOARD OF GOVERNORS.

Not later than 180 days after the date of a final Council determination under section 113 that a nonbank financial company is to be supervised by the Board of Governors, such company shall register with the Board of Governors, on forms prescribed by the Board of Governors, which shall include such information as the Board of Governors, in consultation with the Council, may deem necessary or appropriate to carry out this title. SEC. 115. ENHANCED SUPERVISION AND PRUDENTIAL STANDARDS FOR NONBANK FINANCIAL COMPANIES SUPERVISED BY THE BOARD OF GOVERNORS AND CERTAIN BANK HOLDING COMPANIES.

(a) In General.--
(1) Purpose.--In order to prevent or mitigate risks to the financial stability of the United States that could arise from the material financial distress, failure, or ongoing activities of large, interconnected financial institutions, the Council may make recommendations to the Board of Governors concerning the establishment and refinement of prudential standards and reporting and disclosure requirements applicable to nonbank financial companies supervised by the Board of Governors and large, interconnected bank holding companies, that-- (A) are more stringent than those applicable to other nonbank financial companies and bank holding companies that do not present similar risks to the financial stability of the United States; and (B) increase in stringency, based on the considerations identified in subsection (b)(3). (2) Recommended application of required standards.--In making recommendations under this section, the Council may-- (A) differentiate among companies that are subject to heightened standards on an individual basis or by category, taking into consideration their capital structure, riskiness, complexity, financial activities (including the financial activities of their subsidiaries), size, and any other risk-related factors that the Council deems appropriate; or (B) recommend an asset threshold that is higher than $50,000,000,000 for the application of any standard described in subsections (c) through (g).

(b) Development of Prudential Standards.-- (1) In general.--The recommendations of the Council under subsection (a) may include-- (A) risk-based capital requirements; (B) leverage limits; (C) liquidity requirements; (D) resolution plan and credit exposure report requirements; (E) concentration limits; (F) a contingent capital requirement; (G) enhanced public disclosures; (H) short-term debt limits; and (I) overall risk management requirements.

(2) Prudential standards for foreign financial companies.-- In making recommendations concerning the standards set forth in paragraph (1) that would apply to foreign nonbank financial companies supervised by the Board of Governors or foreign-based bank holding companies, the Council shall-- (A) give due regard to the principle of national treatment and equality of competitive opportunity; and (B) take into account the extent to which the foreign nonbank financial company or foreign-based bank holding company is subject on a consolidated basis to home country standards that are comparable to those applied to financial companies in the United States. (3) Considerations.--In making recommendations concerning prudential standards under paragraph (1), the Council shall-- (A) take into account differences among nonbank financial companies supervised by the Board of Governors and bank holding companies described in subsection (a), based on-- (i) the factors described in subsections (a) and (b) of section 113; (ii) whether the company owns an insured depository institution; (iii) nonfinancial activities and affiliations of the company; and (iv) any other factors that the Council determines appropriate; (B) to the extent possible, ensure that small changes in the factors listed in subsections (a) and (b) of section 113 would not result in sharp, discontinuous changes in the prudential standards established under
section 165; and
(C) adapt its recommendations as appropriate in light of any predominant line of business of such company, including assets under management or other activities for which particular standards may not be appropriate.

(c) Contingent Capital.--
(1) Study required.--The Council shall conduct a study of the feasibility, benefits, costs, and structure of a contingent capital requirement for nonbank financial companies supervised by the Board of Governors and bank holding companies described in subsection (a), which study shall include-- (A) an evaluation of the degree to which such requirement would enhance the safety and soundness of companies subject to the requirement, promote the financial stability of the United States, and reduce risks to United States taxpayers; (B) an evaluation of the characteristics and amounts of contingent capital that should be required; (C) an analysis of potential prudential standards that should be used to determine whether the contingent capital of a company would be converted to equity in times of financial stress; (D) an evaluation of the costs to companies, the effects on the structure and operation of credit and other financial markets, and other economic effects of requiring contingent capital;

(E) an evaluation of the effects of such requirement on the international competitiveness of companies subject to the requirement and the prospects for international coordination in establishing such requirement; and (F) recommendations for implementing regulations. (2) Report.--The Council shall submit a report to Congress regarding the study required by paragraph (1) not later than 2 years after the date of enactment of this Act. (3) Recommendations.-- (A) In general.--Subsequent to submitting a report to Congress under paragraph (2), the Council may make recommendations to the Board of Governors to require any nonbank financial company supervised by the Board of Governors and any bank holding company described in subsection (a) to maintain a minimum amount of contingent capital that is convertible to equity in times of financial stress. (B) Factors to consider.--In making recommendations under this subsection, the Council shall consider-- (i) an appropriate transition period for implementation of a conversion under this subsection; (ii) the factors described in subsection (b)(3); (iii) capital requirements applicable to a nonbank financial company supervised by the Board of Governors or a bank holding company described in subsection (a), and subsidiaries thereof; (iv) results of the study required by paragraph (1); and (v) any other factor that the Council deems appropriate.

(d) Resolution Plan and Credit Exposure Reports.-- (1) Resolution plan.--The Council may make recommendations to the Board of Governors concerning the requirement that each nonbank financial company supervised by the Board of Governors and each bank holding company described in subsection (a) report periodically to the Council, the Board of Governors, and the Corporation, the plan of such company for rapid and orderly resolution in the event of material financial distress or failure. (2) Credit exposure report.--The Council may make recommendations to the Board of Governors concerning the advisability of requiring each nonbank financial company supervised by the Board of Governors and bank holding company described in subsection (a) to report periodically to the Council, the Board of Governors, and the Corporation on-- (A) the nature and extent to which the company has credit exposure to other significant nonbank financial companies and significant bank holding companies; and (B) the nature and extent to which other such significant nonbank financial companies and significant bank holding companies have credit exposure to that company.

(e) Concentration Limits.--In order to limit the risks that the failure of any individual company could pose to nonbank financial companies supervised by the Board of Governors or bank holding companies described in subsection (a), the Council may make recommendations to the Board of Governors to prescribe standards to limit such risks, as set forth in section 165.

(f) Enhanced Public Disclosures.--The Council may make recommendations to the Board of Governors to require periodic public disclosures by bank holding companies described in subsection (a) and by nonbank financial companies supervised by the Board of Governors, in order to support market evaluation of the risk profile, capital adequacy, and risk management capabilities thereof. (g) Short-term Debt Limits.--The Council may make recommendations to the Board of Governors to require short-term debt limits to mitigate the risks that an over-accumulation of such debt could pose to bank holding companies described in subsection (a), nonbank financial companies supervised by the Board of Governors, or the financial system. SEC. 116. REPORTS.

(a) In General.--Subject to subsection (b), the Council, acting through the Office of Financial Research, may require a bank holding company with total consolidated assets of $50,000,000,000 or greater or a nonbank financial company supervised by the Board of Governors, and any subsidiary thereof, to submit certified reports to keep the Council informed as to-- (1) the financial condition of the company; (2) systems for monitoring and controlling financial, operating, and other risks; (3) transactions with any subsidiary that is a depository institution; and (4) the extent to which the activities and operations of the company and any subsidiary thereof, could, under adverse circumstances, have the potential to disrupt financial markets or affect the overall financial stability of the United States.

(b) Use of Existing Reports.--
(1) In general.--For purposes of compliance with subsection (a), the Council, acting through the Office of Financial Research, shall, to the fullest extent possible, use-- (A) reports that a bank holding company, nonbank financial company supervised by the Board of Governors, or any functionally regulated subsidiary of such company has been required to provide to other Federal or State regulatory agencies or to a relevant foreign supervisory authority; (B) information that is otherwise required to be reported publicly; and (C) externally audited financial statements. (2) Availability.--Each bank holding company described in subsection (a) and nonbank financial company supervised by the Board of Governors, and any subsidiary thereof, shall provide to the Council, at the request of the Council, copies of all reports referred to in paragraph (1). (3) Confidentiality.--The Council shall maintain the confidentiality of the reports obtained under subsection (a) and paragraph (1)(A) of this subsection. SEC. 117. TREATMENT OF CERTAIN COMPANIES THAT CEASE TO BE BANK HOLDING COMPANIES.

(a) Applicability.--This section shall apply to-- (1) any entity that--

(A) was a bank holding company having total consolidated assets equal to or greater than $50,000,000,000 as of January 1, 2010; and (B) received financial assistance under or participated in the Capital Purchase Program established under the Troubled Asset Relief Program authorized by the Emergency Economic Stabilization Act of 2008; and (2) any successor entity (as defined by the Board of Governors, in consultation with the Council) to an entity described in paragraph (1).

(b) Treatment.--If an entity described in subsection (a) ceases to be a bank holding company at any time after January 1, 2010, then such entity shall be treated as a nonbank financial company supervised by the Board of Governors, as if the Council had made a determination under
section 113 with respect to that entity.
(c) Appeal.--
(1) Request for hearing.--An entity may request, in writing, an opportunity for a written or oral hearing before the Council to appeal its treatment as a nonbank financial company supervised by the Board of Governors in accordance with this
section. Upon receipt of the request, the Council shall fix a
time (not later than 30 days after the date of receipt of the request) and place at which such entity may appear, personally or through counsel, to submit written materials (or, at the sole discretion of the Council, oral testimony and oral argument). (2) Decision.-- (A) Proposed decision.--A Council decision to grant an appeal under this subsection shall be made by a vote of not fewer than \2/3\ of the voting members then serving, including an affirmative vote by the Chairperson. Not later than 60 days after the date of a hearing under paragraph (1), the Council shall submit a report to, and may testify before, the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives on the proposed decision of the Council regarding an appeal under paragraph (1), which report shall include a statement of the basis for the proposed decision of the Council. (B) Notice of final decision.--The Council shall notify the subject entity of the final decision of the Council regarding an appeal under paragraph (1), which notice shall contain a statement of the basis for the final decision of the Council, not later than 60 days after the later of-- (i) the date of the submission of the report under subparagraph (A); or (ii) if, not later than 1 year after the date of submission of the report under subparagraph (A), the Committee on Banking, Housing, and Urban Affairs of the Senate or the Committee on Financial Services of the House of Representatives holds one or more hearings regarding such report, the date of the last such hearing. (C) Considerations.--In making a decision regarding an appeal under paragraph (1), the Council shall consider whether the company meets the standards under
section 113(a) or 113(b), as applicable, and the
definition of the

term “nonbank financial company” under section 102. The decision of the Council shall be final, subject to the review under paragraph (3). (3) Review.--If the Council denies an appeal under this subsection, the Council shall, not less frequently than annually, review and reevaluate the decision. SEC. 118. COUNCIL FUNDING.

Any expenses of the Council shall be treated as expenses of, and paid by, the Office of Financial Research. SEC. 119. RESOLUTION OF SUPERVISORY JURISDICTIONAL DISPUTES AMONG MEMBER AGENCIES.

(a) Request for Council Recommendation.--The Council shall seek to resolve a dispute among 2 or more member agencies, if-- (1) a member agency has a dispute with another member agency about the respective jurisdiction over a particular bank holding company, nonbank financial company, or financial activity or product (excluding matters for which another dispute mechanism specifically has been provided under title X); (2) the Council determines that the disputing agencies cannot, after a demonstrated good faith effort, resolve the dispute without the intervention of the Council; and (3) any of the member agencies involved in the dispute-- (A) provides all other disputants prior notice of the intent to request dispute resolution by the Council; and (B) requests in writing, not earlier than 14 days after providing the notice described in subparagraph (A), that the Council seek to resolve the dispute.

(b) Council Recommendation.--The Council shall seek to resolve each dispute described in subsection (a)-- (1) within a reasonable time after receiving the dispute resolution request; (2) after consideration of relevant information provided by each agency party to the dispute; and (3) by agreeing with 1 of the disputants regarding the entirety of the matter, or by determining a compromise position.

(c) Form of Recommendation.--Any Council recommendation under this
section shall--
(1) be in writing;
(2) include an explanation of the reasons therefor; and (3) be approved by the affirmative vote of \2/3\ of the voting members of the Council then serving.

(d) Nonbinding Effect.--Any recommendation made by the Council under subsection (c) shall not be binding on the Federal agencies that are parties to the dispute. SEC. 120. ADDITIONAL STANDARDS APPLICABLE TO ACTIVITIES OR PRACTICES FOR FINANCIAL STABILITY PURPOSES.

(a) In General.--The Council may provide for more stringent regulation of a financial activity by issuing recommendations to the primary financial regulatory agencies to apply new or heightened standards and safeguards, including standards enumerated in section 115, for a financial activity or practice conducted by bank holding companies or nonbank financial companies under their respective jurisdictions, if the Council determines that the

conduct, scope, nature, size, scale, concentration, or interconnectedness of such activity or practice could create or increase the risk of significant liquidity, credit, or other problems spreading among bank holding companies and nonbank financial companies, financial markets of the United States, or low-income, minority, or underserved communities. (b) Procedure for Recommendations to Regulators.-- (1) Notice and opportunity for comment.-- The Council shall consult with the primary financial regulatory agencies and provide notice to the public and opportunity for comment for any proposed recommendation that the primary financial regulatory agencies apply new or heightened standards and safeguards for a financial activity or practice. (2) Criteria.--The new or heightened standards and safeguards for a financial activity or practice recommended under paragraph (1)-- (A) shall take costs to long-term economic growth into account; and (B) may include prescribing the conduct of the activity or practice in specific ways (such as by limiting its scope, or applying particular capital or risk management requirements to the conduct of the activity) or prohibiting the activity or practice.

(c) Implementation of Recommended Standards.-- (1) Role of primary financial regulatory agency.-- (A) In general.--Each primary financial regulatory agency may impose, require reports regarding, examine for compliance with, and enforce standards in accordance with this section with respect to those entities for which it is the primary financial regulatory agency. (B) Rule of construction.--The authority under this paragraph is in addition to, and does not limit, any other authority of a primary financial regulatory agency. Compliance by an entity with actions taken by a primary financial regulatory agency under this section shall be enforceable in accordance with the statutes governing the respective jurisdiction of the primary financial regulatory agency over the entity, as if the agency action were taken under those statutes. (2) Imposition of standards.-- The primary financial regulatory agency shall impose the standards recommended by the Council in accordance with subsection (a), or similar standards that the Council deems acceptable, or shall explain in writing to the Council, not later than 90 days after the date on which the Council issues the recommendation, why the agency has determined not to follow the recommendation of the Council.

(d) Report to Congress.--The Council shall report to Congress on-- (1) any recommendations issued by the Council under this
section;
(2) the implementation of, or failure to implement, such recommendation on the part of a primary financial regulatory agency; and (3) in any case in which no primary financial regulatory agency exists for the nonbank financial company conducting financial activities or practices referred to in subsection (a),

recommendations for legislation that would prevent such activities or practices from threatening the stability of the financial system of the United States.

(e) Effect of Rescission of Identification.-- (1) Notice.--The Council may recommend to the relevant primary financial regulatory agency that a financial activity or practice no longer requires any standards or safeguards implemented under this section. (2) Determination of primary financial regulatory agency to continue.-- (A) In general.--Upon receipt of a recommendation under paragraph (1), a primary financial regulatory agency that has imposed standards under this section shall determine whether such standards should remain in effect. (B) Appeal process.-- Each primary financial regulatory agency that has imposed standards under this section shall promulgate regulations to establish a procedure under which entities under its jurisdiction may appeal a determination by such agency under this paragraph that standards imposed under this section should remain in effect. SEC. 121. MITIGATION OF RISKS TO FINANCIAL STABILITY.

(a) Mitigatory Actions.--If the Board of Governors determines that a bank holding company with total consolidated assets of $50,000,000,000 or more, or a nonbank financial company supervised by the Board of Governors, poses a grave threat to the financial stability of the United States, the Board of Governors, upon an affirmative vote of not fewer than \2/3\ of the voting members of the Council then serving, shall-- (1) limit the ability of the company to merge with, acquire, consolidate with, or otherwise become affiliated with another company; (2) restrict the ability of the company to offer a financial product or products; (3) require the company to terminate one or more activities; (4) impose conditions on the manner in which the company conducts 1 or more activities; or (5) if the Board of Governors determines that the actions described in paragraphs (1) through (4) are inadequate to mitigate a threat to the financial stability of the United States in its recommendation, require the company to sell or otherwise transfer assets or off-balance-sheet items to unaffiliated entities.

(b) Notice and Hearing.--
(1) In general.--The Board of Governors, in consultation with the Council, shall provide to a company described in subsection (a) written notice that such company is being considered for mitigatory action pursuant to this section, including an explanation of the basis for, and description of, the proposed mitigatory action. (2) Hearing.--Not later than 30 days after the date of receipt of notice under paragraph (1), the company may request, in writing, an opportunity for a written or oral hearing before the Board of Governors to contest the proposed mitigatory action. Upon receipt of a timely request, the Board of Governors shall fix a time (not later than 30 days after the date of

receipt of the request) and place at which such company may appear, personally or through counsel, to submit written materials (or, at the discretion of the Board of Governors, in consultation with the Council, oral testimony and oral argument). (3) Decision.--Not later than 60 days after the date of a hearing under paragraph (2), or not later than 60 days after the provision of a notice under paragraph (1) if no hearing was held, the Board of Governors shall notify the company of the final decision of the Board of Governors, including the results of the vote of the Council, as described in subsection (a).

(c) Factors for Consideration.--The Board of Governors and the Council shall take into consideration the factors set forth in subsection (a) or (b) of section 113, as applicable, in making any determination under subsection (a). (d) Application to Foreign Financial Companies.--The Board of Governors may prescribe regulations regarding the application of this
section to foreign nonbank financial companies supervised by the Board
of Governors and foreign-based bank holding companies-- (1) giving due regard to the principle of national treatment and equality of competitive opportunity; and (2) taking into account the extent to which the foreign nonbank financial company or foreign-based bank holding company is subject on a consolidated basis to home country standards that are comparable to those applied to financial companies in the United States. SEC. 122. GAO AUDIT OF COUNCIL.

(a) Authority To Audit.--The Comptroller General of the United States may audit the activities of-- (1) the Council; and (2) any person or entity acting on behalf of or under the authority of the Council, to the extent that such activities relate to work for the Council by such person or entity.

(b) Access to Information.--
(1) In general.--Notwithstanding any other provision of law, the Comptroller General shall, upon request and at such reasonable time and in such reasonable form as the Comptroller General may request, have access to-- (A) any records or other information under the control of or used by the Council; (B) any records or other information under the control of a person or entity acting on behalf of or under the authority of the Council, to the extent that such records or other information is relevant to an audit under subsection (a); and (C) the officers, directors, employees, financial advisors, staff, working groups, and agents and representatives of the Council (as related to the activities on behalf of the Council of such agent or representative), at such reasonable times as the Comptroller General may request. (2) Copies.--The Comptroller General may make and retain copies of such books, accounts, and other records, access to which is granted under this section, as the Comptroller General considers appropriate.

SEC. 123. STUDY OF THE EFFECTS OF SIZE AND COMPLEXITY OF FINANCIAL INSTITUTIONS ON CAPITAL MARKET EFFICIENCY AND ECONOMIC GROWTH.

(a) Study Required.--
(1) In general.--The Chairperson of the Council shall carry out a study of the economic impact of possible financial services regulatory limitations intended to reduce systemic risk. Such study shall estimate the benefits and costs on the efficiency of capital markets, on the financial sector, and on national economic growth, of-- (A) explicit or implicit limits on the maximum size of banks, bank holding companies, and other large financial institutions; (B) limits on the organizational complexity and diversification of large financial institutions; (C) requirements for operational separation between business units of large financial institutions in order to expedite resolution in case of failure; (D) limits on risk transfer between business units of large financial institutions; (E) requirements to carry contingent capital or similar mechanisms; (F) limits on commingling of commercial and financial activities by large financial institutions; (G) segregation requirements between traditional financial activities and trading or other high-risk operations in large financial institutions; and (H) other limitations on the activities or structure of large financial institutions that may be useful to limit systemic risk. (2) Recommendations.--The study required by this section shall include recommendations for the optimal structure of any limits considered in subparagraphs (A) through (E), in order to maximize their effectiveness and minimize their economic impact.

(b) Report.--Not later than the end of the 180-day period beginning on the date of enactment of this title, and not later than every 5 years thereafter, the Chairperson shall issue a report to the Congress containing any findings and determinations made in carrying out the study required under subsection (a).

Subtitle B--Office of Financial Research

SEC. 151. DEFINITIONS.

For purposes of this subtitle--
(1) the terms “Office” and “Director” mean the Office of Financial Research established under this subtitle and the Director thereof, respectively; (2) the term “financial company” has the same meaning as in title II, and includes an insured depository institution and an insurance company; (3) the term “Data Center” means the data center established under section 154; (4) the term “Research and Analysis Center” means the research and analysis center established under section 154;

(5) the term “financial transaction data” means the structure and legal description of a financial contract, with sufficient detail to describe the rights and obligations between counterparties and make possible an independent valuation; (6) the term “position data”-- (A) means data on financial assets or liabilities held on the balance sheet of a financial company, where positions are created or changed by the execution of a financial transaction; and (B) includes information that identifies counterparties, the valuation by the financial company of the position, and information that makes possible an independent valuation of the position; (7) the term “financial contract” means a legally binding agreement between 2 or more counterparties, describing rights and obligations relating to the future delivery of items of intrinsic or extrinsic value among the counterparties; and (8) the term “financial instrument” means a financial contract in which the terms and conditions are publicly available, and the roles of one or more of the counterparties are assignable without the consent of any of the other counterparties (including common stock of a publicly traded company, government bonds, or exchange traded futures and options contracts). SEC. 152. OFFICE OF FINANCIAL RESEARCH ESTABLISHED.

(a) Establishment.--There is established within the Department of the Treasury the Office of Financial Research. (b) Director.-- (1) In general.-- The Office shall be headed by a Director, who shall be appointed by the President, by and with the advice and consent of the Senate. (2) Term of service.--The Director shall serve for a term of 6 years, except that, in the event that a successor is not nominated and confirmed by the end of the term of service of a Director, the Director may continue to serve until such time as the next Director is appointed and confirmed. (3) Executive level.--The Director shall be compensated at Level III of the Executive Schedule. (4) Prohibition on dual service.--The individual serving in the position of Director may not, during such service, also serve as the head of any financial regulatory agency. (5) Responsibilities, duties, and authority.--The Director shall have sole discretion in the manner in which the Director fulfills the responsibilities and duties and exercises the authorities described in this subtitle.

(c) Budget.--The Director, in consultation with the Chairperson, shall establish the annual budget of the Office. (d) Office Personnel.-- (1) In general.--The Director, in consultation with the Chairperson, may fix the number of, and appoint and direct, all employees of the Office. (2) Compensation.--The Director, in consultation with the Chairperson, shall fix, adjust, and administer the pay for all employees of the Office, without regard to chapter 51 or subchapter III of chapter 53 of title 5, United States Code, relating to classification of positions and General Schedule pay rates.

(3) Comparability.--Section 1206(a) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1833b(a)) is amended-- (A) by striking “Finance Board,” and inserting “Finance Board, the Office of Financial Research, and the Bureau of Consumer Financial Protection”; and (B) by striking “and the Office of Thrift Supervision,”. (4) Senior executives.--Section 3132(a)(1)(D) of title 5, United States Code, is amended by striking “and the National Credit Union Administration;” and inserting “the National Credit Union Administration, the Bureau of Consumer Financial Protection, and the Office of Financial Research;”.

(e) Assistance From Federal Agencies.--Any department or agency of the United States may provide to the Office and any special advisory, technical, or professional committees appointed by the Office, such services, funds, facilities, staff, and other support services as the Office may determine advisable. Any Federal Government employee may be detailed to the Office without reimbursement, and such detail shall be without interruption or loss of civil service status or privilege. (f) Procurement of Temporary and Intermittent Services.--The Director may procure temporary and intermittent services under section 3109(b) of title 5, United States Code, at rates for individuals which do not exceed the daily equivalent of the annual rate of basic pay prescribed for Level V of the Executive Schedule under section 5316 of such title. (g) Post-employment Prohibitions.-- The Secretary, with the concurrence of the Director of the Office of Government Ethics, shall issue regulations prohibiting the Director and any employee of the Office who has had access to the transaction or position data maintained by the Data Center or other business confidential information about financial entities required to report to the Office from being employed by or providing advice or consulting services to a financial company, for a period of 1 year after last having had access in the course of official duties to such transaction or position data or business confidential information, regardless of whether that entity is required to report to the Office. For employees whose access to business confidential information was limited, the regulations may provide, on a case-by-case basis, for a shorter period of post-employment prohibition, provided that the shorter period does not compromise business confidential information.

(h) Technical and Professional Advisory Committees.--The Office, in consultation with the Chairperson, may appoint such special advisory, technical, or professional committees as may be useful in carrying out the functions of the Office, and the members of such committees may be staff of the Office, or other persons, or both. (i) Fellowship Program.--The Office, in consultation with the Chairperson, may establish and maintain an academic and professional fellowship program, under which qualified academics and professionals shall be invited to spend not longer than 2 years at the Office, to perform research and to provide advanced training for Office personnel. (j) Executive Schedule Compensation.--Section 5314 of title 5, United States Code, is amended by adding at the end the following new item:
“Director of the Office of Financial Research.”.

SEC. 153. PURPOSE AND DUTIES OF THE OFFICE.

(a) Purpose and Duties.--The purpose of the Office is to support the Council in fulfilling the purposes and duties of the Council, as set forth in subtitle A, and to support member agencies, by-- (1) collecting data on behalf of the Council, and providing such data to the Council and member agencies; (2) standardizing the types and formats of data reported and collected; (3) performing applied research and essential long-term research; (4) developing tools for risk measurement and monitoring; (5) performing other related services; (6) making the results of the activities of the Office available to financial regulatory agencies; and (7) assisting such member agencies in determining the types and formats of data authorized by this Act to be collected by such member agencies.

(b) Administrative Authority.--The Office may-- (1) share data and information, including software developed by the Office, with the Council, member agencies, and the Bureau of Economic Analysis, which shared data, information, and software-- (A) shall be maintained with at least the same level of security as is used by the Office; and (B) may not be shared with any individual or entity without the permission of the Council; (2) sponsor and conduct research projects; and (3) assist, on a reimbursable basis, with financial analyses undertaken at the request of other Federal agencies that are not member agencies.

(c) Rulemaking Authority.--
(1) Scope.--The Office, in consultation with the Chairperson, shall issue rules, regulations, and orders only to the extent necessary to carry out the purposes and duties described in paragraphs (1), (2), and (7) of subsection (a). (2) Standardization.--Member agencies, in consultation with the Office, shall implement regulations promulgated by the Office under paragraph (1) to standardize the types and formats of data reported and collected on behalf of the Council, as described in subsection (a)(2). If a member agency fails to implement such regulations prior to the expiration of the 3-year period following the date of publication of final regulations, the Office, in consultation with the Chairperson, may implement such regulations with respect to the financial entities under the jurisdiction of the member agency. This paragraph shall not supersede or interfere with the independent authority of a member agency under other law to collect data, in such format and manner as the member agency requires.

(d) Testimony.--
(1) In general.--The Director of the Office shall report to and testify before the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives annually on the activities of the Office, including the work of the Data Center and the Research and Analysis Center, and the assessment of the

Office of significant financial market developments and potential emerging threats to the financial stability of the United States. (2) No prior review.--No officer or agency of the United States shall have any authority to require the Director to submit the testimony required under paragraph (1) or other congressional testimony to any officer or agency of the United States for approval, comment, or review prior to the submission of such testimony. Any such testimony to Congress shall include a statement that the views expressed therein are those of the Director and do not necessarily represent the views of the President.

(e) Additional Reports.--The Director may provide additional reports to Congress concerning the financial stability of the United States. The Director shall notify the Council of any such additional reports provided to Congress.

(f) Subpoena.--
(1) In general.--The Director may require from a financial company, by subpoena, the production of the data requested under subsection (a)(1) and section 154(b)(1), but only upon a written finding by the Director that-- (A) such data is required to carry out the functions described under this subtitle; and (B) the Office has coordinated with the relevant primary financial regulatory agency, as required under
section 154(b)(1)(B)(ii).
(2) Format.--Subpoenas under paragraph (1) shall bear the signature of the Director, and shall be served by any person or class of persons designated by the Director for that purpose. (3) Enforcement.--In the case of contumacy or failure to obey a subpoena, the subpoena shall be enforceable by order of any appropriate district court of the United States. Any failure to obey the order of the court may be punished by the court as a contempt of court. SEC. 154. ORGANIZATIONAL STRUCTURE; RESPONSIBILITIES OF PRIMARY PROGRAMMATIC UNITS.

(a) In General.--There are established within the Office, to carry out the programmatic responsibilities of the Office-- (1) the Data Center; and (2) the Research and Analysis Center.

(b) Data Center.--
(1) General duties.--
(A) Data collection.--The Data Center, on behalf of the Council, shall collect, validate, and maintain all data necessary to carry out the duties of the Data Center, as described in this subtitle. The data assembled shall be obtained from member agencies, commercial data providers, publicly available data sources, and financial entities under subparagraph (B). (B) Authority.-- (i) In general.--The Office may, as determined by the Council or by the Director in consultation with the Council, require the submission of periodic and other reports from any financial company for the purpose of assessing the extent to which a financial

activity or financial market in which the financial company participates, or the financial company itself, poses a threat to the financial stability of the United States. (ii) Mitigation of report burden.--Before requiring the submission of a report from any financial company that is regulated by a member agency, any primary financial regulatory agency, a foreign supervisory authority, or the Office shall coordinate with such agencies or authority, and shall, whenever possible, rely on information available from such agencies or authority. (iii) Collection of financial transaction and position data.--The Office shall collect, on a
schedule determined by the Director, in
consultation with the Council, financial transaction data and position data from financial companies. (C) Rulemaking.--The Office shall promulgate regulations pursuant to subsections (a)(1), (a)(2), (a)(7), and (c)(1) of section 153 regarding the type and scope of the data to be collected by the Data Center under this paragraph. (2) Responsibilities.-- (A) Publication.--The Data Center shall prepare and publish, in a manner that is easily accessible to the public-- (i) a financial company reference database; (ii) a financial instrument reference database; and (iii) formats and standards for Office data, including standards for reporting financial transaction and position data to the Office. (B) Confidentiality.--The Data Center shall not publish any confidential data under subparagraph (A). (3) Information security.--The Director shall ensure that data collected and maintained by the Data Center are kept secure and protected against unauthorized disclosure. (4) Catalog of financial entities and instruments.--The Data Center shall maintain a catalog of the financial entities and instruments reported to the Office. (5) Availability to the council and member agencies.--The Data Center shall make data collected and maintained by the Data Center available to the Council and member agencies, as necessary to support their regulatory responsibilities. (6) Other authority.--The Office shall, after consultation with the member agencies, provide certain data to financial industry participants and to the general public to increase market transparency and facilitate research on the financial system, to the extent that intellectual property rights are not violated, business confidential information is properly protected, and the sharing of such information poses no significant threats to the financial system of the United States.

(c) Research and Analysis Center.-- (1) General duties.--The Research and Analysis Center, on behalf of the Council, shall develop and maintain independent analytical capabilities and computing resources-- (A) to develop and maintain metrics and reporting systems for risks to the financial stability of the United States;

(B) to monitor, investigate, and report on changes in systemwide risk levels and patterns to the Council and Congress; (C) to conduct, coordinate, and sponsor research to support and improve regulation of financial entities and markets; (D) to evaluate and report on stress tests or other stability-related evaluations of financial entities overseen by the member agencies; (E) to maintain expertise in such areas as may be necessary to support specific requests for advice and assistance from financial regulators; (F) to investigate disruptions and failures in the financial markets, report findings, and make recommendations to the Council based on those findings; (G) to conduct studies and provide advice on the impact of policies related to systemic risk; and (H) to promote best practices for financial risk management.

(d) Reporting Responsibilities.-- (1) Required reports.--Not later than 2 years after the date of enactment of this Act, and not later than 120 days after the end of each fiscal year thereafter, the Office shall prepare and submit a report to Congress. (2) Content.--Each report required by this subsection shall assess the state of the United States financial system, including-- (A) an analysis of any threats to the financial stability of the United States; (B) the status of the efforts of the Office in meeting the mission of the Office; and (C) key findings from the research and analysis of the financial system by the Office. SEC. 155. FUNDING.

(a) Financial Research Fund.--
(1) Fund established.--There is established in the Treasury of the United States a separate fund to be known as the “Financial Research Fund”. (2) Fund receipts.--All amounts provided to the Office under subsection (c), and all assessments that the Office receives under subsection (d) shall be deposited into the Financial Research Fund. (3) Investments authorized.-- (A) Amounts in fund may be invested.--The Director may request the Secretary to invest the portion of the Financial Research Fund that is not, in the judgment of the Director, required to meet the needs of the Office. (B) Eligible investments.--Investments shall be made by the Secretary in obligations of the United States or obligations that are guaranteed as to principal and interest by the United States, with maturities suitable to the needs of the Financial Research Fund, as determined by the Director. (4) Interest and proceeds credited.--The interest on, and the proceeds from the sale or redemption of, any obligations

held in the Financial Research Fund shall be credited to and form a part of the Financial Research Fund.

(b) Use of Funds.--
(1) In general.--Funds obtained by, transferred to, or credited to the Financial Research Fund shall be immediately available to the Office, and shall remain available until expended, to pay the expenses of the Office in carrying out the duties and responsibilities of the Office. (2) Fees, assessments, and other funds not government funds.--Funds obtained by, transferred to, or credited to the Financial Research Fund shall not be construed to be Government funds or appropriated moneys. (3) Amounts not subject to apportionment.--Notwithstanding any other provision of law, amounts in the Financial Research Fund shall not be subject to apportionment for purposes of
chapter 15 of title 31, United States Code, or under any other
authority, or for any other purpose.

(c) Interim Funding.--During the 2-year period following the date of enactment of this Act, the Board of Governors shall provide to the Office an amount sufficient to cover the expenses of the Office.

(d) Permanent Self-funding.--Beginning 2 years after the date of enactment of this Act, the Secretary shall establish, by regulation, and with the approval of the Council, an assessment schedule, including the assessment base and rates, applicable to bank holding companies with total consolidated assets of 50,000,000,000 or greater and nonbank financial companies supervised by the Board of Governors, that takes into account differences among such companies, based on the considerations for establishing the prudential standards under section 115, to collect assessments equal to the total expenses of the Office. SEC. 156. TRANSITION OVERSIGHT.

(a) Purpose.--The purpose of this section is to ensure that the Office-- (1) has an orderly and organized startup; (2) attracts and retains a qualified workforce; and (3) establishes comprehensive employee training and benefits programs.

(b) Reporting Requirement.--
(1) In general.--The Office shall submit an annual report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives that includes the plans described in paragraph (2). (2) Plans.--The plans described in this paragraph are as follows:
(A) Training and workforce development plan.--The Office shall submit a training and workforce development plan that includes, to the extent practicable-- (i) identification of skill and technical expertise needs and actions taken to meet those requirements; (ii) steps taken to foster innovation and creativity; (iii) leadership development and succession planning; and (iv) effective use of technology by employees.

(B) Workplace flexibility plan.--The Office shall submit a workforce flexibility plan that includes, to the extent practicable-- (i) telework; (ii) flexible work schedules; (iii) phased retirement; (iv) reemployed annuitants; (v) part-time work; (vi) job sharing; (vii) parental leave benefits and childcare assistance; (viii) domestic partner benefits; (ix) other workplace flexibilities; or (x) any combination of the items described in clauses (i) through (ix). (C) Recruitment and retention plan.--The Office shall submit a recruitment and retention plan that includes, to the extent practicable, provisions relating to-- (i) the steps necessary to target highly qualified applicant pools with diverse backgrounds; (ii) streamlined employment application processes; (iii) the provision of timely notification of the status of employment applications to applicants; and (iv) the collection of information to measure indicators of hiring effectiveness.

(c) Expiration.--The reporting requirement under subsection (b) shall terminate 5 years after the date of enactment of this Act. (d) Rule of Construction.--Nothing in this section may be construed to affect-- (1) a collective bargaining agreement, as that term is defined in section 7103(a)(8) of title 5, United States Code, that is in effect on the date of enactment of this Act; or (2) the rights of employees under chapter 71 of title 5, United States Code.

Subtitle C--Additional Board of Governors Authority for Certain Nonbank Financial Companies and Bank Holding Companies

SEC. 161. REPORTS BY AND EXAMINATIONS OF NONBANK FINANCIAL COMPANIES BY THE BOARD OF GOVERNORS.

(a) Reports.--
(1) In general.--The Board of Governors may require each nonbank financial company supervised by the Board of Governors, and any subsidiary thereof, to submit reports under oath, to keep the Board of Governors informed as to-- (A) the financial condition of the company or subsidiary, systems of the company or subsidiary for monitoring and controlling financial, operating, and other risks, and the extent to which the activities and operations of the company or subsidiary pose a threat to the financial stability of the United States; and (B) compliance by the company or subsidiary with the requirements of this title.

(2) Use of existing reports and information.--In carrying out subsection (a), the Board of Governors shall, to the fullest extent possible, use-- (A) reports and supervisory information that a nonbank financial company or subsidiary thereof has been required to provide to other Federal or State regulatory agencies; (B) information otherwise obtainable from Federal or State regulatory agencies; (C) information that is otherwise required to be reported publicly; and (D) externally audited financial statements of such company or subsidiary. (3) Availability.--Upon the request of the Board of Governors, a nonbank financial company supervised by the Board of Governors, or a subsidiary thereof, shall promptly provide to the Board of Governors any information described in paragraph (2).

(b) Examinations.--
(1) In general.--Subject to paragraph (2), the Board of Governors may examine any nonbank financial company supervised by the Board of Governors and any subsidiary of such company, to inform the Board of Governors of-- (A) the nature of the operations and financial condition of the company and such subsidiary; (B) the financial, operational, and other risks of the company or such subsidiary that may pose a threat to the safety and soundness of such company or subsidiary or to the financial stability of the United States; (C) the systems for monitoring and controlling such risks; and (D) compliance by the company or such subsidiary with the requirements of this title. (2) Use of examination reports and information.--For purposes of this subsection, the Board of Governors shall, to the fullest extent possible, rely on reports of examination of any subsidiary depository institution or functionally regulated subsidiary made by the primary financial regulatory agency for that subsidiary, and on information described in subsection (a)(2).

(c) Coordination With Primary Financial Regulatory Agency.--The Board of Governors shall-- (1) provide reasonable notice to, and consult with, the primary financial regulatory agency for any subsidiary before requiring a report or commencing an examination of such subsidiary under this section; and (2) avoid duplication of examination activities, reporting requirements, and requests for information, to the fullest extent possible. SEC. 162. ENFORCEMENT.

(a) In General.--Except as provided in subsection (b), a nonbank financial company supervised by the Board of Governors and any subsidiaries of such company (other than any depository institution subsidiary) shall be subject to the provisions of subsections (b) through (n) of section 8 of the Federal Deposit Insurance Act (12 U.S.C. 1818), in the same manner and to the same extent as if the company were a bank holding company, as provided

in section 8(b)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1818(b)(3)). (b) Enforcement Authority for Functionally Regulated Subsidiaries.-- (1) Referral.--If the Board of Governors determines that a condition, practice, or activity of a depository institution subsidiary or functionally regulated subsidiary of a nonbank financial company supervised by the Board of Governors does not comply with the regulations or orders prescribed by the Board of Governors under this Act, or otherwise poses a threat to the financial stability of the United States, the Board of Governors may recommend, in writing, to the primary financial regulatory agency for the subsidiary that such agency initiate a supervisory action or enforcement proceeding. The recommendation shall be accompanied by a written explanation of the concerns giving rise to the recommendation. (2) Back-up authority of the board of governors.--If, during the 60-day period beginning on the date on which the primary financial regulatory agency receives a recommendation under paragraph (1), the primary financial regulatory agency does not take supervisory or enforcement action against a subsidiary that is acceptable to the Board of Governors, the Board of Governors (upon a vote of its members) may take the recommended supervisory or enforcement action, as if the subsidiary were a bank holding company subject to supervision by the Board of Governors. SEC. 163. ACQUISITIONS.

(a) Acquisitions of Banks; Treatment as a Bank Holding Company.--For purposes of section 3 of the Bank Holding Company Act of 1956 (12 U.S.C. 1842), a nonbank financial company supervised by the Board of Governors shall be deemed to be, and shall be treated as, a bank holding company. (b) Acquisition of Nonbank Companies.-- (1) Prior notice for large acquisitions.--Notwithstanding
section 4(k)(6)(B) of the Bank Holding Company Act of 1956 (12
U.S.C. 1843(k)(6)(B)), a bank holding company with total consolidated assets equal to or greater than $50,000,000,000 or a nonbank financial company supervised by the Board of Governors shall not acquire direct or indirect ownership or control of any voting shares of any company (other than an insured depository institution) that is engaged in activities described in section 4(k) of the Bank Holding Company Act of 1956 having total consolidated assets of $10,000,000,000 or more, without providing written notice to the Board of Governors in advance of the transaction. (2) Exemptions.--The prior notice requirement in paragraph (1) shall not apply with regard to the acquisition of shares that would qualify for the exemptions in section 4(c) or section 4(k)(4)(E) of the Bank Holding Company Act of 1956 (12 U.S.C. 1843(c) and (k)(4)(E)). (3) Notice procedures.--The notice procedures set forth in section 4(j)(1) of the Bank Holding Company Act of 1956 (12 U.S.C. 1843(j)(1)), without regard to
section 4(j)(3) of that Act, shall apply to an acquisition of
any company (other than an insured depository institution) by a bank holding company with total consolidated assets equal to or greater than

$50,000,000,000 or a nonbank financial company supervised by the Board of Governors, as described in paragraph (1), including any such company engaged in activities described in section 4(k) of that Act. (4) Standards for review.--In addition to the standards provided in section 4(j)(2) of the Bank Holding Company Act of 1956 (12 U.S.C. 1843(j)(2)), the Board of Governors shall consider the extent to which the proposed acquisition would result in greater or more concentrated risks to global or United States financial stability or the United States economy. (5) Hart-Scott-Rodino filing requirement.--Solely for purposes of section 7A(c)(8) of the Clayton Act (15 U.S.C. 18a(c)(8)), the transactions subject to the requirements of paragraph (1) shall be treated as if Board of Governors approval is not required. SEC. 164. PROHIBITION AGAINST MANAGEMENT INTERLOCKS BETWEEN CERTAIN FINANCIAL COMPANIES.

A nonbank financial company supervised by the Board of Governors shall be treated as a bank holding company for purposes of the Depository Institutions Management Interlocks Act (12 U.S.C. 3201 et seq.), except that the Board of Governors shall not exercise the authority provided in section 7 of that Act (12 U.S.C. 3207) to permit service by a management official of a nonbank financial company supervised by the Board of Governors as a management official of any bank holding company with total consolidated assets equal to or greater than $50,000,000,000, or other nonaffiliated nonbank financial company supervised by the Board of Governors (other than to provide a temporary exemption for interlocks resulting from a merger, acquisition, or consolidation). SEC. 165. ENHANCED SUPERVISION AND PRUDENTIAL STANDARDS FOR NONBANK FINANCIAL COMPANIES SUPERVISED BY THE BOARD OF GOVERNORS AND CERTAIN BANK HOLDING COMPANIES.

(a) In General.--
(1) Purpose.--In order to prevent or mitigate risks to the financial stability of the United States that could arise from the material financial distress or failure, or ongoing activities, of large, interconnected financial institutions, the Board of Governors shall, on its own or pursuant to recommendations by the Council under section 115, establish prudential standards for nonbank financial companies supervised by the Board of Governors and bank holding companies with total consolidated assets equal to or greater than $50,000,000,000 that-- (A) are more stringent than the standards and requirements applicable to nonbank financial companies and bank holding companies that do not present similar risks to the financial stability of the United States; and (B) increase in stringency, based on the considerations identified in subsection (b)(3). (2) Tailored application.-- (A) In general.--In prescribing more stringent prudential standards under this section, the Board of Governors may, on its own or pursuant to a recommendation by the Council in accordance with section 115, differentiate among companies on an individual basis or by category, taking into consideration their capital structure, riskiness,

complexity, financial activities (including the financial activities of their subsidiaries), size, and any other risk-related factors that the Board of Governors deems appropriate. (B) Adjustment of threshold for application of certain standards.--The Board of Governors may, pursuant to a recommendation by the Council in accordance with
section 115, establish an asset threshold above
$50,000,000,000 for the application of any standard established under subsections (c) through (g).

(b) Development of Prudential Standards.-- (1) In general.-- (A) Required standards.--The Board of Governors shall establish prudential standards for nonbank financial companies supervised by the Board of Governors and bank holding companies described in subsection (a), that shall include-- (i) risk-based capital requirements and leverage limits, unless the Board of Governors, in consultation with the Council, determines that such requirements are not appropriate for a company subject to more stringent prudential standards because of the activities of such company (such as investment company activities or assets under management) or structure, in which case, the Board of Governors shall apply other standards that result in similarly stringent risk controls; (ii) liquidity requirements; (iii) overall risk management requirements; (iv) resolution plan and credit exposure report requirements; and (v) concentration limits. (B) Additional standards authorized.--The Board of Governors may establish additional prudential standards for nonbank financial companies supervised by the Board of Governors and bank holding companies described in subsection (a), that include-- (i) a contingent capital requirement; (ii) enhanced public disclosures; (iii) short-term debt limits; and (iv) such other prudential standards as the Board or Governors, on its own or pursuant to a recommendation made by the Council in accordance with section 115, determines are appropriate. (2) Standards for foreign financial companies.--In applying the standards set forth in paragraph (1) to any foreign nonbank financial company supervised by the Board of Governors or foreign-based bank holding company, the Board of Governors shall-- (A) give due regard to the principle of national treatment and equality of competitive opportunity; and (B) take into account the extent to which the foreign financial company is subject on a consolidated basis to home country standards that are comparable to those applied to financial companies in the United States. (3) Considerations.--In prescribing prudential standards under paragraph (1), the Board of Governors shall--

(A) take into account differences among nonbank financial companies supervised by the Board of Governors and bank holding companies described in subsection (a), based on-- (i) the factors described in subsections (a) and (b) of section 113; (ii) whether the company owns an insured depository institution; (iii) nonfinancial activities and affiliations of the company; and (iv) any other risk-related factors that the Board of Governors determines appropriate; (B) to the extent possible, ensure that small changes in the factors listed in subsections (a) and (b) of section 113 would not result in sharp, discontinuous changes in the prudential standards established under paragraph (1) of this subsection; (C) take into account any recommendations of the Council under section 115; and (D) adapt the required standards as appropriate in light of any predominant line of business of such company, including assets under management or other activities for which particular standards may not be appropriate. (4) Consultation.--Before imposing prudential standards or any other requirements pursuant to this section, including notices of deficiencies in resolution plans and more stringent requirements or divestiture orders resulting from such notices, that are likely to have a significant impact on a functionally regulated subsidiary or depository institution subsidiary of a nonbank financial company supervised by the Board of Governors or a bank holding company described in subsection (a), the Board of Governors shall consult with each Council member that primarily supervises any such subsidiary with respect to any such standard or requirement. (5) Report.--The Board of Governors shall submit an annual report to Congress regarding the implementation of the prudential standards required pursuant to paragraph (1), including the use of such standards to mitigate risks to the financial stability of the United States.

(c) Contingent Capital.--
(1) In general.--Subsequent to submission by the Council of a report to Congress under section 115(c), the Board of Governors may issue regulations that require each nonbank financial company supervised by the Board of Governors and bank holding companies described in subsection (a) to maintain a minimum amount of contingent capital that is convertible to equity in times of financial stress. (2) Factors to consider.--In issuing regulations under this subsection, the Board of Governors shall consider-- (A) the results of the study undertaken by the Council, and any recommendations of the Council, under
section 115(c);
(B) an appropriate transition period for implementation of contingent capital under this subsection; (C) the factors described in subsection (b)(3)(A); (D) capital requirements applicable to the nonbank financial company supervised by the Board of Governors

or a bank holding company described in subsection (a), and subsidiaries thereof; and (E) any other factor that the Board of Governors deems appropriate.

(d) Resolution Plan and Credit Exposure Reports.-- (1) Resolution plan.--The Board of Governors shall require each nonbank financial company supervised by the Board of Governors and bank holding companies described in subsection (a) to report periodically to the Board of Governors, the Council, and the Corporation the plan of such company for rapid and orderly resolution in the event of material financial distress or failure, which shall include-- (A) information regarding the manner and extent to which any insured depository institution affiliated with the company is adequately protected from risks arising from the activities of any nonbank subsidiaries of the company; (B) full descriptions of the ownership structure, assets, liabilities, and contractual obligations of the company; (C) identification of the cross-guarantees tied to different securities, identification of major counterparties, and a process for determining to whom the collateral of the company is pledged; and (D) any other information that the Board of Governors and the Corporation jointly require by rule or order. (2) Credit exposure report.--The Board of Governors shall require each nonbank financial company supervised by the Board of Governors and bank holding companies described in subsection (a) to report periodically to the Board of Governors, the Council, and the Corporation on-- (A) the nature and extent to which the company has credit exposure to other significant nonbank financial companies and significant bank holding companies; and (B) the nature and extent to which other significant nonbank financial companies and significant bank holding companies have credit exposure to that company. (3) Review.--The Board of Governors and the Corporation shall review the information provided in accordance with this subsection by each nonbank financial company supervised by the Board of Governors and bank holding company described in subsection (a). (4) Notice of deficiencies.--If the Board of Governors and the Corporation jointly determine, based on their review under paragraph (3), that the resolution plan of a nonbank financial company supervised by the Board of Governors or a bank holding company described in subsection (a) is not credible or would not facilitate an orderly resolution of the company under title 11, United States Code-- (A) the Board of Governors and the Corporation shall notify the company of the deficiencies in the resolution plan; and (B) the company shall resubmit the resolution plan within a timeframe determined by the Board of Governors and the Corporation, with revisions demonstrating that the plan is credible and would result in an orderly resolution under title 11, United States Code, including any

proposed changes in business operations and corporate structure to facilitate implementation of the plan. (5) Failure to resubmit credible plan.-- (A) In general.--If a nonbank financial company supervised by the Board of Governors or a bank holding company described in subsection (a) fails to timely resubmit the resolution plan as required under paragraph (4), with such revisions as are required under subparagraph (B), the Board of Governors and the Corporation may jointly impose more stringent capital, leverage, or liquidity requirements, or restrictions on the growth, activities, or operations of the company, or any subsidiary thereof, until such time as the company resubmits a plan that remedies the deficiencies. (B) Divestiture.--The Board of Governors and the Corporation, in consultation with the Council, may jointly direct a nonbank financial company supervised by the Board of Governors or a bank holding company described in subsection (a), by order, to divest certain assets or operations identified by the Board of Governors and the Corporation, to facilitate an orderly resolution of such company under title 11, United States Code, in the event of the failure of such company, in any case in which-- (i) the Board of Governors and the Corporation have jointly imposed more stringent requirements on the company pursuant to subparagraph (A); and (ii) the company has failed, within the 2-year period beginning on the date of the imposition of such requirements under subparagraph (A), to resubmit the resolution plan with such revisions as were required under paragraph (4)(B). (6) No limiting effect.--A resolution plan submitted in accordance with this subsection shall not be binding on a bankruptcy court, a receiver appointed under title II, or any other authority that is authorized or required to resolve the nonbank financial company supervised by the Board, any bank holding company, or any subsidiary or affiliate of the foregoing. (7) No private right of action.--No private right of action may be based on any resolution plan submitted in accordance with this subsection. (8) Rules.--Not later than 18 months after the date of enactment of this Act, the Board of Governors and the Corporation shall jointly issue final rules implementing this subsection.

(e) Concentration Limits.--
(1) Standards.--In order to limit the risks that the failure of any individual company could pose to a nonbank financial company supervised by the Board of Governors or a bank holding company described in subsection (a), the Board of Governors, by regulation, shall prescribe standards that limit such risks. (2) Limitation on credit exposure.--The regulations prescribed by the Board of Governors under paragraph (1) shall prohibit each nonbank financial company supervised by the Board of Governors and bank holding company described in subsection (a) from having credit exposure to any unaffiliated company that exceeds 25 percent of the capital stock and surplus (or such lower amount as the Board of Governors may

determine by regulation to be necessary to mitigate risks to the financial stability of the United States) of the company. (3) Credit exposure.--For purposes of paragraph (2), “credit exposure” to a company means-- (A) all extensions of credit to the company, including loans, deposits, and lines of credit; (B) all repurchase agreements and reverse repurchase agreements with the company, and all securities borrowing and lending transactions with the company, to the extent that such transactions create credit exposure for the nonbank financial company supervised by the Board of Governors or a bank holding company described in subsection (a); (C) all guarantees, acceptances, or letters of credit (including endorsement or standby letters of credit) issued on behalf of the company; (D) all purchases of or investment in securities issued by the company; (E) counterparty credit exposure to the company in connection with a derivative transaction between the nonbank financial company supervised by the Board of Governors or a bank holding company described in subsection (a) and the company; and (F) any other similar transactions that the Board of Governors, by regulation, determines to be a credit exposure for purposes of this section. (4) Attribution rule.--For purposes of this subsection, any transaction by a nonbank financial company supervised by the Board of Governors or a bank holding company described in subsection (a) with any person is a transaction with a company, to the extent that the proceeds of the transaction are used for the benefit of, or transferred to, that company. (5) Rulemaking.--The Board of Governors may issue such regulations and orders, including definitions consistent with this section, as may be necessary to administer and carry out this subsection. (6) Exemptions.--This subsection shall not apply to any Federal home loan bank. The Board of Governors may, by regulation or order, exempt transactions, in whole or in part, from the definition of the term “credit exposure” for purposes of this subsection, if the Board of Governors finds that the exemption is in the public interest and is consistent with the purpose of this subsection. (7) Transition period.-- (A) In general.--This subsection and any regulations and orders of the Board of Governors under this subsection shall not be effective until 3 years after the date of enactment of this Act. (B) Extension authorized.--The Board of Governors may extend the period specified in subparagraph (A) for not longer than an additional 2 years.

(f) Enhanced Public Disclosures.--The Board of Governors may prescribe, by regulation, periodic public disclosures by nonbank financial companies supervised by the Board of Governors and bank holding companies described in subsection (a) in order to support market evaluation of the risk profile, capital adequacy, and risk management capabilities thereof.

(g) Short-term Debt Limits.--
(1) In general.--In order to mitigate the risks that an over-accumulation of short-term debt could pose to financial companies and to the stability of the United States financial system, the Board of Governors may, by regulation, prescribe a limit on the amount of short-term debt, including off-balance sheet exposures, that may be accumulated by any bank holding company described in subsection (a) and any nonbank financial company supervised by the Board of Governors. (2) Basis of limit.--Any limit prescribed under paragraph (1) shall be based on the short-term debt of the company described in paragraph (1) as a percentage of capital stock and surplus of the company or on such other measure as the Board of Governors considers appropriate. (3) Short-term debt defined.--For purposes of this subsection, the term “short-term debt” means such liabilities with short-dated maturity that the Board of Governors identifies, by regulation, except that such term does not include insured deposits. (4) Rulemaking authority.--In addition to prescribing regulations under paragraphs (1) and (3), the Board of Governors may prescribe such regulations, including definitions consistent with this subsection, and issue such orders, as may be necessary to carry out this subsection. (5) Authority to issue exemptions and adjustments.-- Notwithstanding the Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.), the Board of Governors may, if it determines such action is necessary to ensure appropriate heightened prudential supervision, with respect to a company described in paragraph (1) that does not control an insured depository institution, issue to such company an exemption from or adjustment to the limit prescribed under paragraph (1).

(h) Risk Committee.--
(1) Nonbank financial companies supervised by the board of governors.--The Board of Governors shall require each nonbank financial company supervised by the Board of Governors that is a publicly traded company to establish a risk committee, as set forth in paragraph (3), not later than 1 year after the date of receipt of a notice of final determination under section 113(e)(3) with respect to such nonbank financial company supervised by the Board of Governors. (2) Certain bank holding companies.-- (A) Mandatory regulations.--The Board of Governors shall issue regulations requiring each bank holding company that is a publicly traded company and that has total consolidated assets of not less than $10,000,000,000 to establish a risk committee, as set forth in paragraph (3). (B) Permissive regulations.--The Board of Governors may require each bank holding company that is a publicly traded company and that has total consolidated assets of less than $10,000,000,000 to establish a risk committee, as set forth in paragraph (3), as determined necessary or appropriate by the Board of Governors to promote sound risk management practices. (3) Risk committee.--A risk committee required by this subsection shall--

(A) be responsible for the oversight of the enterprise-wide risk management practices of the nonbank financial company supervised by the Board of Governors or bank holding company described in subsection (a), as applicable; (B) include such number of independent directors as the Board of Governors may determine appropriate, based on the nature of operations, size of assets, and other appropriate criteria related to the nonbank financial company supervised by the Board of Governors or a bank holding company described in subsection (a), as applicable; and (C) include at least 1 risk management expert having experience in identifying, assessing, and managing risk exposures of large, complex firms. (4) Rulemaking.--The Board of Governors shall issue final rules to carry out this subsection, not later than 1 year after the transfer date, to take effect not later than 15 months after the transfer date.

(i) Stress Tests.--
(1) By the board of governors.--
(A) Annual tests required.--The Board of Governors, in coordination with the appropriate primary financial regulatory agencies and the Federal Insurance Office, shall conduct annual analyses in which nonbank financial companies supervised by the Board of Governors and bank holding companies described in subsection (a) are subject to evaluation of whether such companies have the capital, on a total consolidated basis, necessary to absorb losses as a result of adverse economic conditions. (B) Test parameters and consequences.--The Board of Governors-- (i) shall provide for at least 3 different sets of conditions under which the evaluation required by this subsection shall be conducted, including baseline, adverse, and severely adverse; (ii) may require the tests described in subparagraph (A) at bank holding companies and nonbank financial companies, in addition to those for which annual tests are required under subparagraph (A); (iii) may develop and apply such other analytic techniques as are necessary to identify, measure, and monitor risks to the financial stability of the United States; (iv) shall require the companies described in subparagraph (A) to update their resolution plans required under subsection (d)(1), as the Board of Governors determines appropriate, based on the results of the analyses; and (v) shall publish a summary of the results of the tests required under subparagraph (A) or clause (ii) of this subparagraph. (2) By the company.-- (A) Requirement.--A nonbank financial company supervised by the Board of Governors and a bank holding company described in subsection (a) shall conduct semiannual stress tests. All other financial companies that have total consolidated assets of more than $10,000,000,000 and are regulated by a primary Federal financial regulatory

agency shall conduct annual stress tests. The tests required under this subparagraph shall be conducted in accordance with the regulations prescribed under subparagraph (C). (B) Report.--A company required to conduct stress tests under subparagraph (A) shall submit a report to the Board of Governors and to its primary financial regulatory agency at such time, in such form, and containing such information as the primary financial regulatory agency shall require. (C) Regulations.--Each Federal primary financial regulatory agency, in coordination with the Board of Governors and the Federal Insurance Office, shall issue consistent and comparable regulations to implement this paragraph that shall-- (i) define the term “stress test” for purposes of this paragraph; (ii) establish methodologies for the conduct of stress tests required by this paragraph that shall provide for at least 3 different sets of conditions, including baseline, adverse, and severely adverse; (iii) establish the form and content of the report required by subparagraph (B); and (iv) require companies subject to this paragraph to publish a summary of the results of the required stress tests.

(j) Leverage Limitation.--
(1) Requirement.--The Board of Governors shall require a bank holding company with total consolidated assets equal to or greater than $50,000,000,000 or a nonbank financial company supervised by the Board of Governors to maintain a debt to equity ratio of no more than 15 to 1, upon a determination by the Council that such company poses a grave threat to the financial stability of the United States and that the imposition of such requirement is necessary to mitigate the risk that such company poses to the financial stability of the United States. Nothing in this paragraph shall apply to a Federal home loan bank. (2) Considerations.--In making a determination under this subsection, the Council shall consider the factors described in subsections (a) and (b) of section 113 and any other risk- related factors that the Council deems appropriate. (3) Regulations.--The Board of Governors shall promulgate regulations to establish procedures and timelines for complying with the requirements of this subsection.

(k) Inclusion of Off-balance-sheet Activities in Computing Capital Requirements.-- (1) In general.--In the case of any bank holding company described in subsection (a) or nonbank financial company supervised by the Board of Governors, the computation of capital for purposes of meeting capital requirements shall take into account any off-balance-sheet activities of the company. (2) Exemptions.--If the Board of Governors determines that an exemption from the requirement under paragraph (1) is appropriate, the Board of Governors may exempt a company, or any transaction or transactions engaged in by such company, from the requirements of paragraph (1).

(3) Off-balance-sheet activities defined.--For purposes of this subsection, the term “off-balance-sheet activities” means an existing liability of a company that is not currently a balance sheet liability, but may become one upon the happening of some future event, including the following transactions, to the extent that they may create a liability:
(A) Direct credit substitutes in which a bank substitutes its own credit for a third party, including standby letters of credit. (B) Irrevocable letters of credit that guarantee repayment of commercial paper or tax-exempt securities. (C) Risk participations in bankers' acceptances. (D) Sale and repurchase agreements. (E) Asset sales with recourse against the seller. (F) Interest rate swaps. (G) Credit swaps. (H) Commodities contracts. (I) Forward contracts. (J) Securities contracts. (K) Such other activities or transactions as the Board of Governors may, by rule, define. SEC. 166. EARLY REMEDIATION REQUIREMENTS.

(a) In General.--The Board of Governors, in consultation with the Council and the Corporation, shall prescribe regulations establishing requirements to provide for the early remediation of financial distress of a nonbank financial company supervised by the Board of Governors or a bank holding company described in section 165(a), except that nothing in this subsection authorizes the provision of financial assistance from the Federal Government.

(b) Purpose of the Early Remediation Requirements.--The purpose of the early remediation requirements under subsection (a) shall be to establish a series of specific remedial actions to be taken by a nonbank financial company supervised by the Board of Governors or a bank holding company described in section 165(a) that is experiencing increasing financial distress, in order to minimize the probability that the company will become insolvent and the potential harm of such insolvency to the financial stability of the United States. (c) Remediation Requirements.--The regulations prescribed by the Board of Governors under subsection (a) shall-- (1) define measures of the financial condition of the company, including regulatory capital, liquidity measures, and other forward-looking indicators; and (2) establish requirements that increase in stringency as the financial condition of the company declines, including-- (A) requirements in the initial stages of financial decline, including limits on capital distributions, acquisitions, and asset growth; and (B) requirements at later stages of financial decline, including a capital restoration plan and capital-raising requirements, limits on transactions with affiliates, management changes, and asset sales. SEC. 167. AFFILIATIONS.

(a) Affiliations.--Nothing in this subtitle shall be construed to require a nonbank financial company supervised by the Board

of Governors, or a company that controls a nonbank financial company supervised by the Board of Governors, to conform the activities thereof to the requirements of section 4 of the Bank Holding Company Act of 1956 (12 U.S.C. 1843). (b) Requirement.-- (1) In general.-- (A) Board authority.--If a nonbank financial company supervised by the Board of Governors conducts activities other than those that are determined to be financial in nature or incidental thereto under section 4(k) of the Bank Holding Company Act of 1956, the Board of Governors may require such company to establish and conduct all or a portion of such activities that are determined to be financial in nature or incidental thereto in or through an intermediate holding company established pursuant to regulation of the Board of Governors, not later than 90 days (or such longer period as the Board of Governors may deem appropriate) after the date on which the nonbank financial company supervised by the Board of Governors is notified of the determination of the Board of Governors under this section. (B) Necessary actions.--Notwithstanding subparagraph (A), the Board of Governors shall require a nonbank financial company supervised by the Board of Governors to establish an intermediate holding company if the Board of Governors makes a determination that the establishment of such intermediate holding company is necessary to-- (i) appropriately supervise activities that are determined to be financial in nature or incidental thereto; or (ii) to ensure that supervision by the Board of Governors does not extend to the commercial activities of such nonbank financial company. (2) Internal financial activities.--For purposes of this subsection, activities that are determined to be financial in nature or incidental thereto under section 4(k) of the Bank Holding Company Act of 1956, as described in paragraph (1), shall not include internal financial activities, including internal treasury, investment, and employee benefit functions. With respect to any internal financial activity engaged in for the company or an affiliate and a non-affiliate of such company during the year prior to the date of enactment of this Act, such company (or an affiliate that is not an intermediate holding company or subsidiary of an intermediate holding company) may continue to engage in such activity, as long as not less than 2/ 3 of the assets or 2/3 of the revenues generated from the activity are from or attributable to such company or an affiliate, subject to review by the Board of Governors, to determine whether engaging in such activity presents undue risk to such company or to the financial stability of the United States. (3) Source of strength.--A company that directly or indirectly controls an intermediate holding company established under this section shall serve as a source of strength to its subsidiary intermediate holding company. (4) Parent company reports.--The Board of Governors may, from time to time,
require reports under oath from a

company that controls an intermediate holding company, and from the appropriate officers or directors of such company, solely for purposes of ensuring compliance with the provisions of this
section, including assessing the ability of the company to serve
as a source of strength to its subsidiary intermediate holding company pursuant to paragraph (3) and enforcing such compliance. (5) Limited parent company enforcement.-- (A) In general.--In addition to any other authority of the Board of Governors, the Board of Governors may enforce compliance with the provisions of this subsection that are applicable to any company described in paragraph (1) that controls an intermediate holding company under section 8 of the Federal Deposit Insurance Act, and such company shall be subject to such section (solely for such purposes) in the same manner and to the same extent as if such company were a bank holding company. (B) Application of other act.--Any violation of this subsection by any company that controls an intermediate holding company may also be treated as a violation of the Federal Deposit Insurance Act for purposes of subparagraph (A). (C) No effect on other authority.--No provision of this paragraph shall be construed as limiting any authority of the Board of Governors or any other Federal agency under any other provision of law.

(c) Regulations.--The Board of Governors-- (1) shall promulgate regulations to establish the criteria for determining whether to require a nonbank financial company supervised by the Board of Governors to establish an intermediate holding company under subsection (b); and (2) may promulgate regulations to establish any restrictions or limitations on transactions between an intermediate holding company or a nonbank financial company supervised by the Board of Governors and its affiliates, as necessary to prevent unsafe and unsound practices in connection with transactions between such company, or any subsidiary thereof, and its parent company or affiliates that are not subsidiaries of such company, except that such regulations shall not restrict or limit any transaction in connection with the bona fide acquisition or lease by an unaffiliated person of assets, goods, or services. SEC. 168. REGULATIONS.

The Board of Governors shall have authority to issue regulations to implement subtitles A and C and the amendments made thereunder. Except as otherwise specified in subtitle A or C, not later than 18 months after the effective date of this Act, the Board of Governors shall issue final regulations to implement subtitles A and C, and the amendments made thereunder. SEC. 169. AVOIDING DUPLICATION.

The Board of Governors shall take any action that the Board of Governors deems appropriate to avoid imposing requirements under this subtitle that are duplicative of requirements applicable to bank holding companies and nonbank financial companies under other provisions of law.

SEC. 170. SAFE HARBOR.

(a) Regulations.--The Board of Governors shall promulgate regulations on behalf of, and in consultation with, the Council setting forth the criteria for exempting certain types or classes of U.S. nonbank financial companies or foreign nonbank financial companies from supervision by the Board of Governors.

(b) Considerations.--In developing the criteria under subsection (a), the Board of Governors shall take into account the factors for consideration described in subsections (a) and (b) of section 113 in determining whether a U.S. nonbank financial company or foreign nonbank financial company shall be supervised by the Board of Governors. (c) Rule of Construction.--Nothing in this section shall be construed to require supervision by the Board of Governors of a U.S. nonbank financial company or foreign nonbank financial company, if such company does not meet the criteria for exemption established under subsection (a). (d) Revisions.-- (1) In general.--The Board of Governors shall, in consultation with the Council, review the regulations promulgated under subsection (a), not less frequently than every 5 years, and based upon the review, the Board of Governors may revise such regulations on behalf of, and in consultation with, the Council to update as necessary the criteria set forth in such regulations. (2) Transition period.--No revisions under paragraph (1) shall take effect before the end of the 2-year period after the date of publication of such revisions in final form.

(e) Report.--The Chairman of the Board of Governors and the Chairperson of the Council shall submit a joint report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives not later than 30 days after the date of the issuance in final form of regulations under subsection (a), or any subsequent revision to such regulations under subsection (d), as applicable. Such report shall include, at a minimum, the rationale for exemption and empirical evidence to support the criteria for exemption. SEC. 171. LEVERAGE AND RISK-BASED CAPITAL REQUIREMENTS.

(a) Definitions.--For purposes of this section, the following definitions shall apply:
(1) Generally applicable leverage capital requirements.--The term “generally applicable leverage capital requirements” means-- (A) the minimum ratios of tier 1 capital to average total assets, as established by the appropriate Federal banking agencies to apply to insured depository institutions under the prompt corrective action regulations implementing section 38 of the Federal Deposit Insurance Act, regardless of total consolidated asset size or foreign financial exposure; and (B) includes the regulatory capital components in the numerator of that capital requirement, average total assets in the denominator of that capital requirement, and the required ratio of the numerator to the denominator.

(2) Generally applicable risk-based capital requirements.-- The term “generally applicable risk-based capital requirements” means-- (A) the risk-based capital requirements, as established by the appropriate Federal banking agencies to apply to insured depository institutions under the prompt corrective action regulations implementing
section 38 of the Federal Deposit Insurance Act,
regardless of total consolidated asset size or foreign financial exposure; and (B) includes the regulatory capital components in the numerator of those capital requirements, the risk- weighted assets in the denominator of those capital requirements, and the required ratio of the numerator to the denominator. (3) Definition of depository institution holding company.-- The term “depository institution holding company” means a bank holding company or a savings and loan holding company (as those terms are defined in section 3 of the Federal Deposit Insurance Act) that is organized in the United States, including any bank or savings and loan holding company that is owned or controlled by a foreign organization, but does not include the foreign organization.

(b) Minimum Capital Requirements.-- (1) Minimum leverage capital requirements.--The appropriate Federal banking agencies shall establish minimum leverage capital requirements on a consolidated basis for insured depository institutions, depository institution holding companies, and nonbank financial companies supervised by the Board of Governors. The minimum leverage capital requirements established under this paragraph shall not be less than the generally applicable leverage capital requirements, which shall serve as a floor for any capital requirements that the agency may require, nor quantitatively lower than the generally applicable leverage capital requirements that were in effect for insured depository institutions as of the date of enactment of this Act. (2) Minimum risk-based capital requirements.--The appropriate Federal banking agencies shall establish minimum risk-based capital requirements on a consolidated basis for insured depository institutions, depository institution holding companies, and nonbank financial companies supervised by the Board of Governors. The minimum risk-based capital requirements established under this paragraph shall not be less than the generally applicable risk-based capital requirements, which shall serve as a floor for any capital requirements that the agency may require, nor quantitatively lower than the generally applicable risk-based capital requirements that were in effect for insured depository institutions as of the date of enactment of this Act. (3) Investments in financial subsidiaries.--For purposes of this section, investments in financial subsidiaries that insured depository institutions are required to deduct from regulatory capital under section 5136A of the Revised Statutes of the United States or section 46(a)(2) of the Federal Deposit Insurance Act need not be deducted from regulatory capital by depository institution holding companies or nonbank financial companies supervised by the Board of Governors, unless such capital deduction is required by the Board of Governors

or the primary financial regulatory agency in the case of nonbank financial companies supervised by the Board of Governors. (4) Effective dates and phase-in periods.-- (A) Debt or equity instruments on or after may 19, 2010.--For debt or equity instruments issued on or after May 19, 2010, by depository institution holding companies or by nonbank financial companies supervised by the Board of Governors, this section shall be deemed to have become effective as of May 19, 2010. (B) Debt or equity instruments issued before may 19, 2010.--For debt or equity instruments issued before May 19, 2010, by depository institution holding companies or by nonbank financial companies supervised by the Board of Governors, any regulatory capital deductions required under this section shall be phased in incrementally over a period of 3 years, with the phase-in period to begin on January 1, 2013, except as set forth in subparagraph (C). (C) Debt or equity instruments of smaller institutions.--For debt or equity instruments issued before May 19, 2010, by depository institution holding companies with total consolidated assets of less than $15,000,000,000 as of December 31, 2009, and by organizations that were mutual holding companies on May 19, 2010, the capital deductions that would be required for other institutions under this section are not required as a result of this section. (D) Depository institution holding companies not previously supervised by the board of governors.--For any depository institution holding company that was not supervised by the Board of Governors as of May 19, 2010, the requirements of this section, except as set forth in subparagraphs (A) and (B), shall be effective 5 years after the date of enactment of this Act (E) Certain bank holding company subsidiaries of foreign banking organizations.--For bank holding company subsidiaries of foreign banking organizations that have relied on Supervision and Regulation Letter SR-01-1 issued by the Board of Governors (as in effect on May 19, 2010), the requirements of this section, except as set forth in subparagraph (A), shall be effective 5 years after the date of enactment of this Act. (5) Exceptions.--This section shall not apply to-- (A) debt or equity instruments issued to the United States or any agency or instrumentality thereof pursuant to the Emergency Economic Stabilization Act of 2008, and prior to October 4, 2010; (B) any Federal home loan bank; or (C) any small bank holding company that is subject to the Small Bank Holding Company Policy Statement of the Board of Governors, as in effect on May 19, 2010. (6) Study and report on small institution access to capital.-- (A) Study required.--The Comptroller General of the United States, after consultation with the Federal banking

agencies, shall conduct a study of access to capital by smaller insured depository institutions. (B) Scope.--For purposes of this study required by subparagraph (A), the term “smaller insured depository institution” means an insured depository institution with total consolidated assets of $5,000,000,000 or less. (C) Report to congress.--Not later than 18 months after the date of enactment of this Act, the Comptroller General of the United States shall submit to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives a report summarizing the results of the study conducted under subparagraph (A), together with any recommendations for legislative or regulatory action that would enhance the access to capital of smaller insured depository institutions, in a manner that is consistent with safe and sound banking operations. (7) Capital requirements to address activities that pose risks to the financial system.-- (A) In general.--Subject to the recommendations of the Council, in accordance with section 120, the Federal banking agencies shall develop capital requirements applicable to insured depository institutions, depository institution holding companies, and nonbank financial companies supervised by the Board of Governors that address the risks that the activities of such institutions pose, not only to the institution engaging in the activity, but to other public and private stakeholders in the event of adverse performance, disruption, or failure of the institution or the activity. (B) Content.--Such rules shall address, at a minimum, the risks arising from-- (i) significant volumes of activity in derivatives, securitized products purchased and sold, financial guarantees purchased and sold, securities borrowing and lending, and repurchase agreements and reverse repurchase agreements; (ii) concentrations in assets for which the values presented in financial reports are based on models rather than historical cost or prices deriving from deep and liquid 2-way markets; and (iii) concentrations in market share for any activity that would substantially disrupt financial markets if the institution is forced to unexpectedly cease the activity. SEC. 172. EXAMINATION AND ENFORCEMENT ACTIONS FOR INSURANCE AND ORDERLY LIQUIDATION PURPOSES.

(a) Examinations for Insurance and Resolution Purposes.--Section 10(b)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1820(b)(3)) is amended-- (1) by striking “In addition” and inserting the following:
“(A) In general.--In addition”; and (2) by striking “whenever the board of directors determines” and all that follows through the period and inserting the following: “or nonbank financial company supervised by the Board of Governors or a bank holding company described in section

165(a) of the Financial Stability Act of 2010, whenever the Board of Directors determines that a special examination of any such depository institution is necessary to determine the condition of such depository institution for insurance purposes, or of such nonbank financial company supervised by the Board of Governors or bank holding company described in section 165(a) of the Financial Stability Act of 2010, for the purpose of implementing its authority to provide for orderly liquidation of any such company under title II of that Act, provided that such authority may not be used with respect to any such company that is in a generally sound condition. “(B) Limitation.-- Before conducting a special examination of a nonbank financial company supervised by the Board of Governors or a bank holding company described in section 165(a) of the Financial Stability Act of 2010, the Corporation shall review any available and acceptable resolution plan that the company has submitted in accordance with section 165(d) of that Act, consistent with the nonbinding effect of such plan, and available reports of examination, and shall coordinate to the maximum extent practicable with the Board of Governors, in order to minimize duplicative or conflicting examinations.”.

(b) Enforcement Authority.--Section 8(t) of the Federal Deposit Insurance Act (12 U.S.C. 1818(t)) is amended-- (1) in paragraph (1), by inserting “, any depository institution holding company,” before “or any institution- affiliated party”; (2) in paragraph (2)-- (A) by striking “or” at the end of subparagraph (B); (B) at the end of subparagraph (C), by striking the period and inserting “or”; and (C) by inserting at the end the following new subparagraph:
“(D) the conduct or threatened conduct (including any acts or omissions) of the depository institution holding company poses a risk to the Deposit Insurance Fund, provided that such authority may not be used with respect to a depository institution holding company that is in generally sound condition and whose conduct does not pose a foreseeable and material risk of loss to the Deposit Insurance Fund;”; and (3) by adding at the end the following:
“(6) Powers and duties with respect to depository institution holding companies.--For purposes of exercising the backup authority provided in this subsection-- “(A) the Corporation shall have the same powers with respect to a depository institution holding company and its affiliates as the appropriate Federal banking agency has with respect to the holding company and its affiliates; and “(B) the holding company and its affiliates shall have the same duties and obligations with respect to the Corporation as the holding company and its affiliates have with respect to the appropriate Federal banking agency.”.

(c) Rule of Construction.--Nothing in this Act shall be construed to limit or curtail the Corporation's current authority to

examine or bring enforcement actions with respect to any insured depository institution or institution-affiliated party. SEC. 173. ACCESS TO UNITED STATES FINANCIAL MARKET BY FOREIGN INSTITUTIONS.

(a) Establishment of Foreign Bank Offices in the United States.--
Section 7(d)(3) of the International Banking Act of 1978 (12 U.S.C.
3105(d)(3)) is amended--
(1) in subparagraph (C), by striking “and” at the end; (2) in subparagraph (D), by striking the period at the end of and inserting “; and”; and (3) by adding at the end the following new subparagraph:
“(E) for a foreign bank that presents a risk to the stability of United States financial system, whether the home country of the foreign bank has adopted, or is making demonstrable progress toward adopting, an appropriate system of financial regulation for the financial system of such home country to mitigate such risk.”.

(b) Termination of Foreign Bank Offices in the United States.--
Section 7(e)(1) of the International Banking Act of 1978 (12 U.S.C.
3105(e)(1)) is amended--
(1) in subparagraph (A), by striking “or” at the end; (2) in subparagraph (B), by striking the period at the end of and inserting “; or”; and (3) by inserting after subparagraph (B), the following new subparagraph:
“(C) for a foreign bank that presents a risk to the stability of the United States financial system, the home country of the foreign bank has not adopted, or made demonstrable progress toward adopting, an appropriate system of financial regulation to mitigate such risk.”.

(c) Registration or Succession to a United States Broker or Dealer and Termination of Such Registration.--Section 15 of the Securities Exchange Act of 1934 (15 U.S.C. 78o) is amended by adding at the end the following new subsections:
“(k) Registration or Succession to a United States Broker or Dealer.--In determining whether to permit a foreign person or an affiliate of a foreign person to register as a United States broker or dealer, or succeed to the registration of a United States broker or dealer, the Commission may consider whether, for a foreign person, or an affiliate of a foreign person that presents a risk to the stability of the United States financial system, the home country of the foreign person has adopted, or made demonstrable progress toward adopting, an appropriate system of financial regulation to mitigate such risk. “(l) Termination of a United States Broker or Dealer.--For a foreign person or an affiliate of a foreign person that presents such a risk to the stability of the United States financial system, the Commission may determine to terminate the registration of such foreign person or an affiliate of such foreign person as a broker or dealer in the United States, if the Commission determines that the home country of the foreign person has not adopted, or made demonstrable progress toward adopting, an appropriate system of financial regulation to mitigate such risk.”.

SEC. 174. STUDIES AND REPORTS ON HOLDING COMPANY CAPITAL REQUIREMENTS.

(a) Study of Hybrid Capital Instruments.--The Comptroller General of the United States, in consultation with the Board of Governors, the Comptroller of the Currency, and the Corporation, shall conduct a study of the use of hybrid capital instruments as a component of Tier 1 capital for banking institutions and bank holding companies. The study shall consider-- (1) the current use of hybrid capital instruments, such as trust preferred shares, as a component of Tier 1 capital; (2) the differences between the components of capital permitted for insured depository institutions and those permitted for companies that control insured depository institutions; (3) the benefits and risks of allowing such instruments to be used to comply with Tier 1 capital requirements; (4) the economic impact of prohibiting the use of such capital instruments for Tier 1; (5) a review of the consequences of disqualifying trust preferred instruments, and whether it could lead to the failure or undercapitalization of existing banking organizations; (6) the international competitive implications prohibiting hybrid capital instruments for Tier 1; (7) the impact on the cost and availability of credit in the United States from such a prohibition; (8) the availability of capital for financial institutions with less than $10,000,000,000 in total assets; and (9) any other relevant factors relating to the safety and soundness of our financial system and potential economic impact of such a prohibition.

(b) Study of Foreign Bank Intermediate Holding Company Capital Requirements.--The Comptroller General of the United States, in consultation with the Secretary, the Board of Governors, the Comptroller of the Currency, and the Corporation, shall conduct a study of capital requirements applicable to United States intermediate holding companies of foreign banks that are bank holding companies or savings and loan holding companies. The study shall consider-- (1) current Board of Governors policy regarding the treatment of intermediate holding companies; (2) the principle of national treatment and equality of competitive opportunity for foreign banks operating in the United States; (3) the extent to which foreign banks are subject on a consolidated basis to home country capital standards comparable to United States capital standards; (4) potential effects on United States banking organizations operating abroad of changes to United States policy regarding intermediate holding companies; (5) the impact on the cost and availability of credit in the United States from a change in United States policy regarding intermediate holding companies; and (6) any other relevant factors relating to the safety and soundness of our financial system and potential economic impact of such a prohibition.

(c) Report.--Not later than 18 months after the date of enactment of this Act, the Comptroller General of the United States shall submit reports to the Committee on Banking, Housing, and

Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives summarizing the results of the studies required under subsection (a). The reports shall include specific recommendations for legislative or regulatory action regarding the treatment of hybrid capital instruments, including trust preferred shares, and shall explain the basis for such recommendations. SEC. 175. INTERNATIONAL POLICY COORDINATION.

(a) By the President.--The President, or a designee of the President, may coordinate through all available international policy channels, similar policies as those found in United States law relating to limiting the scope, nature, size, scale, concentration, and interconnectedness of financial companies, in order to protect financial stability and the global economy. (b) By the Council.--The Chairperson of the Council, in consultation with the other members of the Council, shall regularly consult with the financial regulatory entities and other appropriate organizations of foreign governments or international organizations on matters relating to systemic risk to the international financial system. (c) By the Board of Governors and the Secretary.--The Board of Governors and the Secretary shall consult with their foreign counterparts and through appropriate multilateral organizations to encourage comprehensive and robust prudential supervision and regulation for all highly leveraged and interconnected financial companies. SEC. 176. RULE OF CONSTRUCTION.

No regulation or standard imposed under this title may be construed in a manner that would lessen the stringency of the requirements of any applicable primary financial regulatory agency or any other Federal or State agency that are otherwise applicable. This title, and the rules and regulations or orders prescribed pursuant to this title, do not divest any such agency of any authority derived from any other applicable law.

TITLE II--ORDERLY LIQUIDATION AUTHORITY

SEC. 201. DEFINITIONS.

(a) In General.--In this title, the following definitions shall apply:
(1) Administrative expenses of the receiver.--The term “administrative expenses of the receiver” includes-- (A) the actual, necessary costs and expenses incurred by the Corporation as receiver for a covered financial company in liquidating a covered financial company; and (B) any obligations that the Corporation as receiver for a covered financial company determines are necessary and appropriate to facilitate the smooth and orderly liquidation of the covered financial company. (2) Bankruptcy code.--The term “Bankruptcy Code” means title 11, United States Code. (3) Bridge financial company.--The term “bridge financial company” means a new financial company organized by

the Corporation in accordance with section 210(h) for the purpose of resolving a covered financial company. (4) Claim.--The term “claim” means any right to payment, whether or not such right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, or unsecured. (5) Company.--The term “company” has the same meaning as in section 2(b) of the Bank Holding Company Act of 1956 (12 U.S.C. 1841(b)), except that such term includes any company described in paragraph (11), the majority of the securities of which are owned by the United States or any State. (6) Court.--The term “Court” means the United States District Court for the District of Columbia, unless the context otherwise requires. (7) Covered broker or dealer.--The term “covered broker or dealer” means a covered financial company that is a broker or dealer that-- (A) is registered with the Commission under section 15(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78o(b)); and (B) is a member of SIPC. (8) Covered financial company.--The term “covered financial company”-- (A) means a financial company for which a determination has been made under section 203(b); and (B) does not include an insured depository institution. (9) Covered subsidiary.--The term “covered subsidiary” means a subsidiary of a covered financial company, other than-- (A) an insured depository institution; (B) an insurance company; or (C) a covered broker or dealer. (10) Definitions relating to covered brokers and dealers.-- The terms “customer”, “customer name securities”, “customer property”, and “net equity” in the context of a covered broker or dealer, have the same meanings as in section 16 of the Securities Investor Protection Act of 1970 (15 U.S.C. 78lll). (11) Financial company.--The term “financial company” means any company that-- (A) is incorporated or organized under any provision of Federal law or the laws of any State; (B) is-- (i) a bank holding company, as defined in
section 2(a) of the Bank Holding Company Act of
1956 (12 U.S.C. 1841(a));
(ii) a nonbank financial company supervised by the Board of Governors; (iii) any company that is predominantly engaged in activities that the Board of Governors has determined are financial in nature or incidental thereto for purposes of section 4(k) of the Bank Holding Company Act of 1956 (12 U.S.C. 1843(k)) other than a company described in clause (i) or (ii); or (iv) any subsidiary of any company described in any of clauses (i) through (iii) that is predominantly engaged in activities that the Board of Governors has

determined are financial in nature or incidental thereto for purposes of section 4(k) of the Bank Holding Company Act of 1956 (12 U.S.C. 1843(k)) (other than a subsidiary that is an insured depository institution or an insurance company); and (C) is not a Farm Credit System institution chartered under and subject to the provisions of the Farm Credit Act of 1971, as amended (12 U.S.C. 2001 et seq.), a governmental entity, or a regulated entity, as defined under section 1303(20) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4502(20)). (12) Fund.--The term “Fund” means the Orderly Liquidation Fund established under section 210(n). (13) Insurance company.--The term “insurance company” means any entity that is-- (A) engaged in the business of insurance; (B) subject to regulation by a State insurance regulator; and (C) covered by a State law that is designed to specifically deal with the rehabilitation, liquidation, or insolvency of an insurance company. (14) Nonbank financial company.--The term “nonbank financial company” has the same meaning as in section 102(a)(4)(C). (15) Nonbank financial company supervised by the board of governors.--The term “nonbank financial company supervised by the Board of Governors” has the same meaning as in section 102(a)(4)(D). (16) SIPC.--The term “SIPC” means the Securities Investor Protection Corporation.

(b) Definitional Criteria.--For purpose of the definition of the term “financial company” under subsection (a)(11), no company shall be deemed to be predominantly engaged in activities that the Board of Governors has determined are financial in nature or incidental thereto for purposes of section 4(k) of the Bank Holding Company Act of 1956 (12 U.S.C. 1843(k)), if the consolidated revenues of such company from such activities constitute less than 85 percent of the total consolidated revenues of such company, as the Corporation, in consultation with the Secretary, shall establish by regulation. In determining whether a company is a financial company under this title, the consolidated revenues derived from the ownership or control of a depository institution shall be included. SEC. 202. JUDICIAL REVIEW.

(a) Commencement of Orderly Liquidation.-- (1) Petition to district court.-- (A) District court review.-- (i) Petition to district court.-- Subsequent to a determination by the Secretary under section 203 that a financial company satisfies the criteria in
section 203(b), the Secretary shall notify the
Corporation and the covered financial company. If the board of directors (or body performing similar functions) of the covered financial company acquiesces or consents to the appointment of the Corporation as receiver, the Secretary shall appoint the Corporation as receiver. If

the board of directors (or body performing similar functions) of the covered financial company does not acquiesce or consent to the appointment of the Corporation as receiver, the Secretary shall petition the United States District Court for the District of Columbia for an order authorizing the Secretary to appoint the Corporation as receiver. (ii) Form and content of order.--The Secretary shall present all relevant findings and the recommendation made pursuant to section 203(a) to the Court. The petition shall be filed under seal. (iii) Determination.--On a strictly confidential basis, and without any prior public disclosure, the Court, after notice to the covered financial company and a hearing in which the covered financial company may oppose the petition, shall determine whether the determination of the Secretary that the covered financial company is in default or in danger of default and satisfies the definition of a financial company under section 201(a)(11) is arbitrary and capricious. (iv) Issuance of order.--If the Court determines that the determination of the Secretary that the covered financial company is in default or in danger of default and satisfies the definition of a financial company under section 201(a)(11)-- (I) is not arbitrary and capricious, the Court shall issue an order immediately authorizing the Secretary to appoint the Corporation as receiver of the covered financial company; or (II) is arbitrary and capricious, the Court shall immediately provide to the Secretary a written statement of each reason supporting its determination, and afford the Secretary an immediate opportunity to amend and refile the petition under clause (i). (v) Petition granted by operation of law.--If the Court does not make a determination within 24 hours of receipt of the petition-- (I) the petition shall be granted by operation of law; (II) the Secretary shall appoint the Corporation as receiver; and (III) liquidation under this title shall automatically and without further notice or action be commenced and the Corporation may immediately take all actions authorized under this title. (B) Effect of determination.--The determination of the Court under subparagraph (A) shall be final, and shall be subject to appeal only in accordance with paragraph (2). The decision shall not be subject to any stay or injunction pending appeal. Upon conclusion of its proceedings under subparagraph (A), the Court shall provide immediately for the record a written statement of each reason supporting the decision of the Court, and shall provide copies thereof to the Secretary and the covered financial company.

(C) Criminal penalties.--A person who recklessly discloses a determination of the Secretary under section 203(b) or a petition of the Secretary under subparagraph (A), or the pendency of court proceedings as provided for under subparagraph (A), shall be fined not more than 250,000, or imprisoned for not more than 5 years, or both. (2) Appeal of decisions of the district court.-- (A) Appeal to court of appeals.-- (i) In general.-- Subject to clause (ii), the United States Court of Appeals for the District of Columbia Circuit shall have jurisdiction of an appeal of a final decision of the Court filed by the Secretary or a covered financial company, through its board of directors, notwithstanding
section 210(a)(1)(A)(i), not later than 30 days
after the date on which the decision of the Court is rendered or deemed rendered under this subsection. (ii) Condition of jurisdiction.--The Court of Appeals shall have jurisdiction of an appeal by a covered financial company only if the covered financial company did not acquiesce or consent to the appointment of a receiver by the Secretary under paragraph (1)(A). (iii) Expedition.--The Court of Appeals shall consider any appeal under this subparagraph on an expedited basis. (iv) Scope of review.--For an appeal taken under this subparagraph, review shall be limited to whether the determination of the Secretary that a covered financial company is in default or in danger of default and satisfies the definition of a financial company under section 201(a)(11) is arbitrary and capricious. (B) Appeal to the supreme court.-- (i) In general.--A petition for a writ of certiorari to review a decision of the Court of Appeals under subparagraph (A) may be filed by the Secretary or the covered financial company, through its board of directors, notwithstanding section 210(a)(1)(A)(i), with the Supreme Court of the United States, not later than 30 days after the date of the final decision of the Court of Appeals, and the Supreme Court shall have discretionary jurisdiction to review such decision. (ii) Written statement.-- In the event of a petition under clause (i), the Court of Appeals shall immediately provide for the record a written statement of each reason for its decision. (iii) Expedition.--The Supreme Court shall consider any petition under this subparagraph on an expedited basis. (iv) Scope of review.--Review by the Supreme Court under this subparagraph shall be limited to whether the determination of the Secretary that the covered financial company is in default or in danger of default and satisfies the definition of a financial company under section 201(a)(11) is arbitrary and capricious.

(b) Establishment and Transmittal of Rules and Procedures.--

(1) In general.--Not later than 6 months after the date of enactment of this Act, the Court shall establish such rules and procedures as may be necessary to ensure the orderly conduct of proceedings, including rules and procedures to ensure that the 24-hour deadline is met and that the Secretary shall have an ongoing opportunity to amend and refile petitions under subsection (a)(1). (2) Publication of rules.--The rules and procedures established under paragraph (1), and any modifications of such rules and procedures, shall be recorded and shall be transmitted to-- (A) the Committee on the Judiciary of the Senate; (B) the Committee on Banking, Housing, and Urban Affairs of the Senate; (C) the Committee on the Judiciary of the House of Representatives; and (D) the Committee on Financial Services of the House of Representatives.

(c) Provisions Applicable to Financial Companies.-- (1) Bankruptcy code.--Except as provided in this subsection, the provisions of the Bankruptcy Code and rules issued thereunder or otherwise applicable insolvency law, and not the provisions of this title, shall apply to financial companies that are not covered financial companies for which the Corporation has been appointed as receiver. (2) This title.--The provisions of this title shall exclusively apply to and govern all matters relating to covered financial companies for which the Corporation is appointed as receiver, and no provisions of the Bankruptcy Code or the rules issued thereunder shall apply in such cases, except as expressly provided in this title.

(d) Time Limit on Receivership Authority.-- (1) Baseline period.--Any appointment of the Corporation as receiver under this section shall terminate at the end of the 3- year period beginning on the date on which such appointment is made. (2) Extension of time limit.-- The time limit established in paragraph (1) may be extended by the Corporation for up to 1 additional year, if the Chairperson of the Corporation determines and certifies in writing to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives that continuation of the receivership is necessary-- (A) to-- (i) maximize the net present value return from the sale or other disposition of the assets of the covered financial company; or (ii) minimize the amount of loss realized upon the sale or other disposition of the assets of the covered financial company; and (B) to protect the stability of the financial system of the United States. (3) Second extension of time limit.-- (A) In general.--The time limit under this subsection, as extended under paragraph (2), may be extended for

up to 1 additional year, if the Chairperson of the Corporation, with the concurrence of the Secretary, submits the certifications described in paragraph (2). (B) Additional report required.--Not later than 30 days after the date of commencement of the extension under subparagraph (A), the Corporation shall submit a report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives describing the need for the extension and the specific plan of the Corporation to conclude the receivership before the end of the second extension. (4) Ongoing litigation.--The time limit under this subsection, as extended under paragraph (3), may be further extended solely for the purpose of completing ongoing litigation in which the Corporation as receiver is a party, provided that the appointment of the Corporation as receiver shall terminate not later than 90 days after the date of completion of such litigation, if-- (A) the Council determines that the Corporation used its best efforts to conclude the receivership in accordance with its plan before the end of the time limit described in paragraph (3); (B) the Council determines that the completion of longer-term responsibilities in the form of ongoing litigation justifies the need for an extension; and (C) the Corporation submits a report approved by the Council not later than 30 days after the date of the determinations by the Council under subparagraphs (A) and (B) to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives, describing-- (i) the ongoing litigation justifying the need for an extension; and (ii) the specific plan of the Corporation to complete the litigation and conclude the receivership. (5) Regulations.--The Corporation may issue regulations governing the termination of receiverships under this title. (6) No liability.--The Corporation and the Deposit Insurance Fund shall not be liable for unresolved claims arising from the receivership after the termination of the receivership.

(e) Study of Bankruptcy and Orderly Liquidation Process for Financial Companies.-- (1) Study.-- (A) In general.--The Administrative Office of the United States Courts and the Comptroller General of the United States shall each monitor the activities of the Court, and each such Office shall conduct separate studies regarding the bankruptcy and orderly liquidation process for financial companies under the Bankruptcy Code. (B) Issues to be studied.-- In conducting the study under subparagraph (A), the Administrative Office of the United States Courts and the Comptroller General of the United States each shall evaluate-- (i) the effectiveness of chapter 7 or chapter 11 of the Bankruptcy Code in facilitating the orderly liquidation or reorganization of financial companies;

(ii) ways to maximize the efficiency and effectiveness of the Court; and (iii) ways to make the orderly liquidation process under the Bankruptcy Code for financial companies more effective. (2) Reports.--Not later than 1 year after the date of enactment of this Act, in each successive year until the third year, and every fifth year after that date of enactment, the Administrative Office of the United States Courts and the Comptroller General of the United States shall submit to the Committee on Banking, Housing, and Urban Affairs and the Committee on the Judiciary of the Senate and the Committee on Financial Services and the Committee on the Judiciary of the House of Representatives separate reports summarizing the results of the studies conducted under paragraph (1).

(f) Study of International Coordination Relating to Bankruptcy Process for Financial Companies.-- (1) Study.-- (A) In general.--The Comptroller General of the United States shall conduct a study regarding international coordination relating to the orderly liquidation of financial companies under the Bankruptcy Code. (B) Issues to be studied.--In conducting the study under subparagraph (A), the Comptroller General of the United States shall evaluate, with respect to the bankruptcy process for financial companies-- (i) the extent to which international coordination currently exists; (ii) current mechanisms and structures for facilitating international cooperation; (iii) barriers to effective international coordination; and (iv) ways to increase and make more effective international coordination. (2) Report.--Not later than 1 year after the date of enactment of this Act, the Comptroller General of the United States shall submit to the Committee on Banking, Housing, and Urban Affairs and the Committee on the Judiciary of the Senate and the Committee on Financial Services and the Committee on the Judiciary of the House of Representatives and the Secretary a report summarizing the results of the study conducted under paragraph (1).

(g) Study of Prompt Corrective Action Implementation by the Appropriate Federal Agencies.-- (1) Study.--The Comptroller General of the United States shall conduct a study regarding the implementation of prompt corrective action by the appropriate Federal banking agencies. (2) Issues to be studied.-- In conducting the study under paragraph (1), the Comptroller General shall evaluate-- (A) the effectiveness of implementation of prompt corrective action by the appropriate Federal banking agencies and the resolution of insured depository institutions by the Corporation; and (B) ways to make prompt corrective action a more effective tool to resolve the insured depository institutions at the least possible long-term cost to the Deposit Insurance Fund.

(3) Report to council.--Not later than 1 year after the date of enactment of this Act, the Comptroller General shall submit a report to the Council on the results of the study conducted under this subsection. (4) Council report of action.--Not later than 6 months after the date of receipt of the report from the Comptroller General under paragraph (3), the Council shall submit a report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives on actions taken in response to the report, including any recommendations made to the Federal primary financial regulatory agencies under section 120. SEC. 203. SYSTEMIC RISK DETERMINATION.

(a) Written Recommendation and Determination.-- (1) Vote required.-- (A) In general.--On their own initiative, or at the request of the Secretary, the Corporation and the Board of Governors shall consider whether to make a written recommendation described in paragraph (2) with respect to whether the Secretary should appoint the Corporation as receiver for a financial company. Such recommendation shall be made upon a vote of not fewer than \2/3\ of the members of the Board of Governors then serving and \2/3\ of the members of the board of directors of the Corporation then serving. (B) Cases involving brokers or dealers.--In the case of a broker or dealer, or in which the largest United States subsidiary (as measured by total assets as of the end of the previous calendar quarter) of a financial company is a broker or dealer, the Commission and the Board of Governors, at the request of the Secretary, or on their own initiative, shall consider whether to make the written recommendation described in paragraph (2) with respect to the financial company. Subject to the requirements in paragraph (2), such recommendation shall be made upon a vote of not fewer than \2/3\ of the members of the Board of Governors then serving and \2/3\ of the members of the Commission then serving, and in consultation with the Corporation. (C) Cases involving insurance companies.--In the case of an insurance company, or in which the largest United States subsidiary (as measured by total assets as of the end of the previous calendar quarter) of a financial company is an insurance company, the Director of the Federal Insurance Office and the Board of Governors, at the request of the Secretary or on their own initiative, shall consider whether to make the written recommendation described in paragraph (2) with respect to the financial company. Subject to the requirements in paragraph (2), such recommendation shall be made upon a vote of not fewer than \2/3\ of the Board of Governors then serving and the affirmative approval of the Director of the Federal Insurance Office, and in consultation with the Corporation. (2) Recommendation required.--Any written recommendation pursuant to paragraph (1) shall contain--

(A) an evaluation of whether the financial company is in default or in danger of default; (B) a description of the effect that the default of the financial company would have on financial stability in the United States; (C) a description of the effect that the default of the financial company would have on economic conditions or financial stability for low income, minority, or underserved communities; (D) a recommendation regarding the nature and the extent of actions to be taken under this title regarding the financial company; (E) an evaluation of the likelihood of a private sector alternative to prevent the default of the financial company; (F) an evaluation of why a case under the Bankruptcy Code is not appropriate for the financial company; (G) an evaluation of the effects on creditors, counterparties, and shareholders of the financial company and other market participants; and (H) an evaluation of whether the company satisfies the definition of a financial company under section 201.

(b) Determination by the Secretary.--Notwithstanding any other provision of Federal or State law, the Secretary shall take action in accordance with section 202(a)(1)(A), if, upon the written recommendation under subsection (a), the Secretary (in consultation with the President) determines that-- (1) the financial company is in default or in danger of default; (2) the failure of the financial company and its resolution under otherwise applicable Federal or State law would have serious adverse effects on financial stability in the United States; (3) no viable private sector alternative is available to prevent the default of the financial company; (4) any effect on the claims or interests of creditors, counterparties, and shareholders of the financial company and other market participants as a result of actions to be taken under this title is appropriate, given the impact that any action taken under this title would have on financial stability in the United States; (5) any action under section 204 would avoid or mitigate such adverse effects, taking into consideration the effectiveness of the action in mitigating potential adverse effects on the financial system, the cost to the general fund of the Treasury, and the potential to increase excessive risk taking on the part of creditors, counterparties, and shareholders in the financial company; (6) a Federal regulatory agency has ordered the financial company to convert all of its convertible debt instruments that are subject to the regulatory order; and (7) the company satisfies the definition of a financial company under section 201.

(c) Documentation and Review.--
(1) In general.--The Secretary shall-- (A) document any determination under subsection (b); (B) retain the documentation for review under paragraph (2); and

(C) notify the covered financial company and the Corporation of such determination. (2) Report to congress.--Not later than 24 hours after the date of appointment of the Corporation as receiver for a covered financial company, the Secretary shall provide written notice of the recommendations and determinations reached in accordance with subsections (a) and (b) to the Majority Leader and the Minority Leader of the Senate and the Speaker and the Minority Leader of the House of Representatives, the Committee on Banking, Housing, and Urban Affairs of the Senate, and the Committee on Financial Services of the House of Representatives, which shall consist of a summary of the basis for the determination, including, to the extent available at the time of the determination-- (A) the size and financial condition of the covered financial company; (B) the sources of capital and credit support that were available to the covered financial company; (C) the operations of the covered financial company that could have had a significant impact on financial stability, markets, or both; (D) identification of the banks and financial companies which may be able to provide the services offered by the covered financial company; (E) any potential international ramifications of resolution of the covered financial company under other applicable insolvency law; (F) an estimate of the potential effect of the resolution of the covered financial company under other applicable insolvency law on the financial stability of the United States; (G) the potential effect of the appointment of a receiver by the Secretary on consumers; (H) the potential effect of the appointment of a receiver by the Secretary on the financial system, financial markets, and banks and other financial companies; and (I) whether resolution of the covered financial company under other applicable insolvency law would cause banks or other financial companies to experience severe liquidity distress. (3) Reports to congress and the public.-- (A) In general.--Not later than 60 days after the date of appointment of the Corporation as receiver for a covered financial company, the Corporation shall file a report with the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives-- (i) setting forth information on the financial condition of the covered financial company as of the date of the appointment, including a description of its assets and liabilities; (ii) describing the plan of, and actions taken by, the Corporation to wind down the covered financial company; (iii) explaining each instance in which the Corporation waived any applicable requirements of
part 366

of title 12, Code of Federal Regulations (or any successor thereto) with respect to conflicts of interest by any person in the private sector who was retained to provide services to the Corporation in connection with such receivership; (iv) describing the reasons for the provision of any funding to the receivership out of the Fund; (v) setting forth the expected costs of the orderly liquidation of the covered financial company; (vi) setting forth the identity of any claimant that is treated in a manner different from other similarly situated claimants under subsection (b)(4), (d)(4), or (h)(5)(E), the amount of any additional payment to such claimant under subsection (d)(4), and the reason for any such action; and (vii) which report the Corporation shall publish on an online website maintained by the Corporation, subject to maintaining appropriate confidentiality. (B) Amendments.--The Corporation shall, on a timely basis, not less frequently than quarterly, amend or revise and resubmit the reports prepared under this paragraph, as necessary. (C) Congressional testimony.-- The Corporation and the primary financial regulatory agency, if any, of the financial company for which the Corporation was appointed receiver under this title shall appear before Congress, if requested, not later than 30 days after the date on which the Corporation first files the reports required under subparagraph (A). (4) Default or in danger of default.--For purposes of this title, a financial company shall be considered to be in default or in danger of default if, as determined in accordance with subsection (b)-- (A) a case has been, or likely will promptly be, commenced with respect to the financial company under the Bankruptcy Code; (B) the financial company has incurred, or is likely to incur, losses that will deplete all or substantially all of its capital, and there is no reasonable prospect for the company to avoid such depletion; (C) the assets of the financial company are, or are likely to be, less than its obligations to creditors and others; or (D) the financial company is, or is likely to be, unable to pay its obligations (other than those subject to a bona fide dispute) in the normal course of business. (5) GAO review.--The Comptroller General of the United States shall review and report to Congress on any determination under subsection (b), that results in the appointment of the Corporation as receiver, including-- (A) the basis for the determination; (B) the purpose for which any action was taken pursuant thereto; (C) the likely effect of the determination and such action on the incentives and conduct of financial companies and their creditors, counterparties, and shareholders; and

(D) the likely disruptive effect of the determination and such action on the reasonable expectations of creditors, counterparties, and shareholders, taking into account the impact any action under this title would have on financial stability in the United States, including whether the rights of such parties will be disrupted.

(d) Corporation Policies and Procedures.--As soon as is practicable after the date of enactment of this Act, the Corporation shall establish policies and procedures that are acceptable to the Secretary governing the use of funds available to the Corporation to carry out this title, including the terms and conditions for the provision and use of funds under sections 204(d), 210(h)(2)(G)(iv), and 210(h)(9). (e) Treatment of Insurance Companies and Insurance Company Subsidiaries.-- (1) In general.--Notwithstanding subsection (b), if an insurance company is a covered financial company or a subsidiary or affiliate of a covered financial company, the liquidation or rehabilitation of such insurance company, and any subsidiary or affiliate of such company that is not excepted under paragraph (2), shall be conducted as provided under applicable State law. (2) Exception for subsidiaries and affiliates.--The requirement of paragraph (1) shall not apply with respect to any subsidiary or affiliate of an insurance company that is not itself an insurance company. (3) Backup authority.-- Notwithstanding paragraph (1), with respect to a covered financial company described in paragraph (1), if, after the end of the 60-day period beginning on the date on which a determination is made under section 202(a) with respect to such company, the appropriate regulatory agency has not filed the appropriate judicial action in the appropriate State court to place such company into orderly liquidation under the laws and requirements of the State, the Corporation shall have the authority to stand in the place of the appropriate regulatory agency and file the appropriate judicial action in the appropriate State court to place such company into orderly liquidation under the laws and requirements of the State. SEC. 204. ORDERLY LIQUIDATION OF COVERED FINANCIAL COMPANIES.

(a) Purpose of Orderly Liquidation Authority.--It is the purpose of this title to provide the necessary authority to liquidate failing financial companies that pose a significant risk to the financial stability of the United States in a manner that mitigates such risk and minimizes moral hazard. The authority provided in this title shall be exercised in the manner that best fulfills such purpose, so that-- (1) creditors and shareholders will bear the losses of the financial company; (2) management responsible for the condition of the financial company will not be retained; and (3) the Corporation and other appropriate agencies will take all steps necessary and appropriate to assure that all parties, including management, directors, and third parties, having responsibility for the condition of the financial company

bear losses consistent with their responsibility, including actions for damages, restitution, and recoupment of compensation and other gains not compatible with such responsibility.

(b) Corporation as Receiver.--Upon the appointment of the Corporation under section 202, the Corporation shall act as the receiver for the covered financial company, with all of the rights and obligations set forth in this title. (c) Consultation.--The Corporation, as receiver-- (1) shall consult with the primary financial regulatory agency or agencies of the covered financial company and its covered subsidiaries for purposes of ensuring an orderly liquidation of the covered financial company; (2) may consult with, or under subsection (a)(1)(B)(v) or (a)(1)(L) of section 210, acquire the services of, any outside experts, as appropriate to inform and aid the Corporation in the orderly liquidation process; (3) shall consult with the primary financial regulatory agency or agencies of any subsidiaries of the covered financial company that are not covered subsidiaries, and coordinate with such regulators regarding the treatment of such solvent subsidiaries and the separate resolution of any such insolvent subsidiaries under other governmental authority, as appropriate; and (4) shall consult with the Commission and the Securities Investor Protection Corporation in the case of any covered financial company for which the Corporation has been appointed as receiver that is a broker or dealer registered with the Commission under section 15(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78o(b)) and is a member of the Securities Investor Protection Corporation, for the purpose of determining whether to transfer to a bridge financial company organized by the Corporation as receiver, without consent of any customer, customer accounts of the covered financial company.

(d) Funding for Orderly Liquidation.--Upon its appointment as receiver for a covered financial company, and thereafter as the Corporation may, in its discretion, determine to be necessary or appropriate, the Corporation may make available to the receivership, subject to the conditions set forth in section 206 and subject to the plan described in section 210(n)(9), funds for the orderly liquidation of the covered financial company. All funds provided by the Corporation under this subsection shall have a priority of claims under subparagraph (A) or (B) of section 210(b)(1), as applicable, including funds used for-- (1) making loans to, or purchasing any debt obligation of, the covered financial company or any covered subsidiary; (2) purchasing or guaranteeing against loss the assets of the covered financial company or any covered subsidiary, directly or through an entity established by the Corporation for such purpose; (3) assuming or guaranteeing the obligations of the covered financial company or any covered subsidiary to 1 or more third parties; (4) taking a lien on any or all assets of the covered financial company or any covered subsidiary, including a first priority lien on all unencumbered assets of the covered financial company or any covered subsidiary to secure repayment of any transactions conducted under this subsection;

(5) selling or transferring all, or any part, of such acquired assets, liabilities, or obligations of the covered financial company or any covered subsidiary; and (6) making payments pursuant to subsections (b)(4), (d)(4), and (h)(5)(E) of section 210. SEC. 205. ORDERLY LIQUIDATION OF COVERED BROKERS AND DEALERS.

(a) Appointment of SIPC as Trustee.-- (1) Appointment.--Upon the appointment of the Corporation as receiver for any covered broker or dealer, the Corporation shall appoint, without any need for court approval, the Securities Investor Protection Corporation to act as trustee for the liquidation under the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.) of the covered broker or dealer. (2) Actions by sipc.-- (A) Filing.--Upon appointment of SIPC under paragraph (1), SIPC shall promptly file with any Federal district court of competent jurisdiction specified in
section 21 or 27 of the Securities Exchange Act of 1934
(15 U.S.C. 78u, 78aa), an application for a protective decree under the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.) as to the covered broker or dealer. The Federal district court shall accept and approve the filing, including outside of normal business hours, and shall immediately issue the protective decree as to the covered broker or dealer. (B) Administration by sipc.--Following entry of the protective decree, and except as otherwise provided in this section, the determination of claims and the liquidation of assets retained in the receivership of the covered broker or dealer and not transferred to the bridge financial company shall be administered under the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.) by SIPC, as trustee for the covered broker or dealer. (C) Definition of filing date.--For purposes of the liquidation proceeding, the term “filing date” means the date on which the Corporation is appointed as receiver of the covered broker or dealer. (D) Determination of claims.--As trustee for the covered broker or dealer, SIPC shall determine and satisfy, consistent with this title and with the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.), all claims against the covered broker or dealer arising on or before the filing date.

(b) Powers and Duties of SIPC.--
(1) In general.--Except as provided in this section, upon its appointment as trustee for the liquidation of a covered broker or dealer, SIPC shall have all of the powers and duties provided by the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.), including, without limitation, all rights of action against third parties, and shall conduct such liquidation in accordance with the terms of the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.), except that SIPC shall have no powers or duties with respect to assets and liabilities transferred by the Corporation from the covered

broker or dealer to any bridge financial company established in accordance with this title. (2) Limitation of powers.--The exercise by SIPC of powers and functions as trustee under subsection (a) shall not impair or impede the exercise of the powers and duties of the Corporation with regard to-- (A) any action, except as otherwise provided in this title-- (i) to make funds available under section 204(d); (ii) to organize, establish, operate, or terminate any bridge financial company; (iii) to transfer assets and liabilities; (iv) to enforce or repudiate contracts; or (v) to take any other action relating to such bridge financial company under section 210; or (B) determining claims under subsection (e). (3) Protective decree.--SIPC and the Corporation, in consultation with the Commission, shall jointly determine the terms of the protective decree to be filed by SIPC with any court of competent jurisdiction under section 21 or 27 of the Securities Exchange Act of 1934 (15 U.S.C. 78u, 78aa), as required by subsection (a). (4) Qualified financial contracts.--Notwithstanding any provision of the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.) to the contrary (including section 5(b)(2)(C) of that Act (15 U.S.C. 78eee(b)(2)(C))), the rights and obligations of any party to a qualified financial contract (as that term is defined in section 210(c)(8)) to which a covered broker or dealer for which the Corporation has been appointed receiver is a party shall be governed exclusively by
section 210, including the limitations and restrictions
contained in section 210(c)(10)(B).

(c) Limitation on Court Action.--Except as otherwise provided in this title, no court may take any action, including any action pursuant to the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.) or the Bankruptcy Code, to restrain or affect the exercise of powers or functions of the Corporation as receiver for a covered broker or dealer and any claims against the Corporation as such receiver shall be determined in accordance with subsection (e) and such claims shall be limited to money damages. (d) Actions by Corporation as Receiver.-- (1) In general.--Notwithstanding any other provision of this title, no action taken by the Corporation as receiver with respect to a covered broker or dealer shall-- (A) adversely affect the rights of a customer to customer property or customer name securities; (B) diminish the amount or timely payment of net equity claims of customers; or (C) otherwise impair the recoveries provided to a customer under the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.). (2) Net proceeds.--The net proceeds from any transfer, sale, or disposition of assets of the covered broker or dealer, or proceeds thereof by the Corporation as receiver for the covered broker or dealer shall be for the benefit of the estate of the covered broker or dealer, as provided in this title.

(e) Claims Against the Corporation as Receiver.--Any claim against the Corporation as receiver for a covered broker or dealer for assets transferred to a bridge financial company established with respect to such covered broker or dealer-- (1) shall be determined in accordance with section 210(a)(2); and (2) may be reviewed by the appropriate district or territorial court of the United States in accordance with
section 210(a)(5).

(f) Satisfaction of Customer Claims.-- (1) Obligations to customers.--Notwithstanding any other provision of this title, all obligations of a covered broker or dealer or of any bridge financial company established with respect to such covered broker or dealer to a customer relating to, or net equity claims based upon, customer property or customer name securities shall be promptly discharged by SIPC, the Corporation, or the bridge financial company, as applicable, by the delivery of securities or the making of payments to or for the account of such customer, in a manner and in an amount at least as beneficial to the customer as would have been the case had the actual proceeds realized from the liquidation of the covered broker or dealer under this title been distributed in a proceeding under the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.) without the appointment of the Corporation as receiver and without any transfer of assets or liabilities to a bridge financial company, and with a filing date as of the date on which the Corporation is appointed as receiver. (2) Satisfaction of claims by sipc.--SIPC, as trustee for a covered broker or dealer, shall satisfy customer claims in the manner and amount provided under the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.), as if the appointment of the Corporation as receiver had not occurred, and with a filing date as of the date on which the Corporation is appointed as receiver. The Corporation shall satisfy customer claims, to the extent that a customer would have received more securities or cash with respect to the allocation of customer property had the covered financial company been subject to a proceeding under the Securities Investor Protection Act (15 U.S.C. 78aaa et seq.) without the appointment of the Corporation as receiver, and with a filing date as of the date on which the Corporation is appointed as receiver.

(g) Priorities.--
(1) Customer property.--As trustee for a covered broker or dealer, SIPC shall allocate customer property and deliver customer name securities in accordance with section 8(c) of the Securities Investor Protection Act of 1970 (15 U.S.C. 78fff- 2(c)). (2) Other claims.--All claims other than those described in paragraph (1) (including any unpaid claim by a customer for the allowed net equity claim of such customer from customer property) shall be paid in accordance with the priorities in
section 210(b).

(h) Rulemaking.--The Commission and the Corporation, after consultation with SIPC, shall jointly issue rules to implement this
section.

SEC. 206. MANDATORY TERMS AND CONDITIONS FOR ALL ORDERLY LIQUIDATION ACTIONS.

In taking action under this title, the Corporation shall-- (1) determine that such action is necessary for purposes of the financial stability of the United States, and not for the purpose of preserving the covered financial company; (2) ensure that the shareholders of a covered financial company do not receive payment until after all other claims and the Fund are fully paid; (3) ensure that unsecured creditors bear losses in accordance with the priority of claim provisions in section 210; (4) ensure that management responsible for the failed condition of the covered financial company is removed (if such management has not already been removed at the time at which the Corporation is appointed receiver); (5) ensure that the members of the board of directors (or body performing similar functions) responsible for the failed condition of the covered financial company are removed, if such members have not already been removed at the time the Corporation is appointed as receiver; and (6) not take an equity interest in or become a shareholder of any covered financial company or any covered subsidiary. SEC. 207. DIRECTORS NOT LIABLE FOR ACQUIESCING IN APPOINTMENT OF RECEIVER.

The members of the board of directors (or body performing similar functions) of a covered financial company shall not be liable to the shareholders or creditors thereof for acquiescing in or consenting in good faith to the appointment of the Corporation as receiver for the covered financial company under section 203. SEC. 208. DISMISSAL AND EXCLUSION OF OTHER ACTIONS.

(a) In General.--Effective as of the date of the appointment of the Corporation as receiver for the covered financial company under section 202 or the appointment of SIPC as trustee for a covered broker or dealer under section 205, as applicable, any case or proceeding commenced with respect to the covered financial company under the Bankruptcy Code or the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.) shall be dismissed, upon notice to the bankruptcy court (with respect to a case commenced under the Bankruptcy Code), and upon notice to SIPC (with respect to a covered broker or dealer) and no such case or proceeding may be commenced with respect to a covered financial company at any time while the orderly liquidation is pending. (b) Revesting of Assets.--Effective as of the date of appointment of the Corporation as receiver, the assets of a covered financial company shall, to the extent they have vested in any entity other than the covered financial company as a result of any case or proceeding commenced with respect to the covered financial company under the Bankruptcy Code, the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.), or any similar provision of State liquidation or insolvency law applicable to the covered financial company, revest in the covered financial company. (c) Limitation.--Notwithstanding subsections (a) and (b), any order entered or other relief granted by a bankruptcy court prior to the date of appointment of the Corporation as receiver shall

continue with the same validity as if an orderly liquidation had not been commenced. SEC. 209. RULEMAKING; NON-CONFLICTING LAW.

The Corporation shall, in consultation with the Council, prescribe such rules or regulations as the Corporation considers necessary or appropriate to implement this title, including rules and regulations with respect to the rights, interests, and priorities of creditors, counterparties, security entitlement holders, or other persons with respect to any covered financial company or any assets or other property of or held by such covered financial company, and address the potential for conflicts of interest between or among individual receiverships established under this title or under the Federal Deposit Insurance Act. To the extent possible, the Corporation shall seek to harmonize applicable rules and regulations promulgated under this section with the insolvency laws that would otherwise apply to a covered financial company. SEC. 210. POWERS AND DUTIES OF THE CORPORATION.

(a) Powers and Authorities.--
(1) General powers.--
(A) Successor to covered financial company.--The Corporation shall, upon appointment as receiver for a covered financial company under this title, succeed to-- (i) all rights, titles, powers, and privileges of the covered financial company and its assets, and of any stockholder, member, officer, or director of such company; and (ii) title to the books, records, and assets of any previous receiver or other legal custodian of such covered financial company. (B) Operation of the covered financial company during the period of orderly liquidation.--The Corporation, as receiver for a covered financial company, may-- (i) take over the assets of and operate the covered financial company with all of the powers of the members or shareholders, the directors, and the officers of the covered financial company, and conduct all business of the covered financial company; (ii) collect all obligations and money owed to the covered financial company; (iii) perform all functions of the covered financial company, in the name of the covered financial company; (iv) manage the assets and property of the covered financial company, consistent with maximization of the value of the assets in the context of the orderly liquidation; and (v) provide by contract for assistance in fulfilling any function, activity, action, or duty of the Corporation as receiver. (C) Functions of covered financial company officers, directors, and shareholders.--The Corporation may provide for the exercise of any function by any member or stockholder, director, or officer of any covered financial company for which the Corporation has been appointed as receiver under this title.

(D) Additional powers as receiver.--The Corporation shall, as receiver for a covered financial company, and subject to all legally enforceable and perfected security interests and all legally enforceable security entitlements in respect of assets held by the covered financial company, liquidate, and wind-up the affairs of a covered financial company, including taking steps to realize upon the assets of the covered financial company, in such manner as the Corporation deems appropriate, including through the sale of assets, the transfer of assets to a bridge financial company established under subsection (h), or the exercise of any other rights or privileges granted to the receiver under this section. (E) Additional powers with respect to failing subsidiaries of a covered financial company.-- (i) In general.--In any case in which a receiver is appointed for a covered financial company under section 202, the Corporation may appoint itself as receiver of any covered subsidiary of the covered financial company that is organized under Federal law or the laws of any State, if the Corporation and the Secretary jointly determine that-- (I) the covered subsidiary is in default or in danger of default; (II) such action would avoid or mitigate serious adverse effects on the financial stability or economic conditions of the United States; and (III) such action would facilitate the orderly liquidation of the covered financial company. (ii) Treatment as covered financial company.-- If the Corporation is appointed as receiver of a covered subsidiary of a covered financial company under clause (i), the covered subsidiary shall thereafter be considered a covered financial company under this title, and the Corporation shall thereafter have all the powers and rights with respect to that covered subsidiary as it has with respect to a covered financial company under this title. (F) Organization of bridge companies.--The Corporation, as receiver for a covered financial company, may organize a bridge financial company under subsection (h). (G) Merger; transfer of assets and liabilities.-- (i) In general.--Subject to clauses (ii) and (iii), the Corporation, as receiver for a covered financial company, may-- (I) merge the covered financial company with another company; or (II) transfer any asset or liability of the covered financial company (including any assets and liabilities held by the covered financial company for security entitlement holders, any customer property, or any assets and liabilities associated with any trust or custody business) without obtaining any approval, assignment, or consent with respect to such transfer. (ii) Federal agency approval; antitrust review.--With respect to a transaction described in

clause (i)(I) that requires approval by a Federal agency-- (I) the transaction may not be consummated before the 5th calendar day after the date of approval by the Federal agency responsible for such approval; (II) if, in connection with any such approval, a report on competitive factors is required, the Federal agency responsible for such approval shall promptly notify the Attorney General of the United States of the proposed transaction, and the Attorney General shall provide the required report not later than 10 days after the date of the request; and (III) if notification under section 7A of the Clayton Act is required with respect to such transaction, then the required waiting period shall end on the 15th day after the date on which the Attorney General and the Federal Trade Commission receive such notification, unless the waiting period is terminated earlier under subsection (b)(2) of such section 7A, or is extended pursuant to subsection (e)(2) of such section 7A. (iii) Setoff.--Subject to the other provisions of this title, any transferee of assets from a receiver, including a bridge financial company, shall be subject to such claims or rights as would prevail over the rights of such transferee in such assets under applicable noninsolvency law. (H) Payment of valid obligations.--The Corporation, as receiver for a covered financial company, shall, to the extent that funds are available, pay all valid obligations of the covered financial company that are due and payable at the time of the appointment of the Corporation as receiver, in accordance with the prescriptions and limitations of this title. (I) Applicable noninsolvency law.--Except as may otherwise be provided in this title, the applicable noninsolvency law shall be determined by the noninsolvency choice of law rules otherwise applicable to the claims, rights, titles, persons, or entities at issue. (J) Subpoena authority.-- (i) In general.--The Corporation, as receiver for a covered financial company, may, for purposes of carrying out any power, authority, or duty with respect to the covered financial company (including determining any claim against the covered financial company and determining and realizing upon any asset of any person in the course of collecting money due the covered financial company), exercise any power established under section 8(n) of the Federal Deposit Insurance Act, as if the Corporation were the appropriate Federal banking agency for the covered financial company, and the covered financial company were an insured depository institution. (ii) Rule of construction.--This subparagraph may not be construed as limiting any rights that the

Corporation, in any capacity, might otherwise have to exercise any powers described in clause (i) or under any other provision of law. (K) Incidental powers.--The Corporation, as receiver for a covered financial company, may exercise all powers and authorities specifically granted to receivers under this title, and such incidental powers as shall be necessary to carry out such powers under this title. (L) Utilization of private sector.--In carrying out its responsibilities in the management and disposition of assets from the covered financial company, the Corporation, as receiver for a covered financial company, may utilize the services of private persons, including real estate and loan portfolio asset management, property management, auction marketing, legal, and brokerage services, if such services are available in the private sector, and the Corporation determines that utilization of such services is practicable, efficient, and cost effective. (M) Shareholders and creditors of covered financial company.--Notwithstanding any other provision of law, the Corporation, as receiver for a covered financial company, shall succeed by operation of law to the rights, titles, powers, and privileges described in subparagraph (A), and shall terminate all rights and claims that the stockholders and creditors of the covered financial company may have against the assets of the covered financial company or the Corporation arising out of their status as stockholders or creditors, except for their right to payment, resolution, or other satisfaction of their claims, as permitted under this
section. The Corporation shall ensure that shareholders
and unsecured creditors bear losses, consistent with the priority of claims provisions under this section. (N) Coordination with foreign financial authorities.--The Corporation, as receiver for a covered financial company, shall coordinate, to the maximum extent possible, with the appropriate foreign financial authorities regarding the orderly liquidation of any covered financial company that has assets or operations in a country other than the United States. (O) Restriction on transfers.-- (i) Selection of accounts for transfer.--If the Corporation establishes one or more bridge financial companies with respect to a covered broker or dealer, the Corporation shall transfer to one of such bridge financial companies, all customer accounts of the covered broker or dealer, and all associated customer name securities and customer property, unless the Corporation, after consulting with the Commission and SIPC, determines that-- (I) the customer accounts, customer name securities, and customer property are likely to be promptly transferred to another broker or dealer that is registered with the Commission under
section 15(b) of the Securities Exchange
Act of 1934 (15 U.S.C. 73o(b)) and is a member of SIPC; or (II) the transfer of the accounts to a bridge financial company would materially interfere with

the ability of the Corporation to avoid or mitigate serious adverse effects on financial stability or economic conditions in the United States. (ii) Transfer of property.--SIPC, as trustee for the liquidation of the covered broker or dealer, and the Commission shall provide any and all reasonable assistance necessary to complete such transfers by the Corporation. (iii) Customer consent and court approval not required.--Neither customer consent nor court approval shall be required to transfer any customer accounts or associated customer name securities or customer property to a bridge financial company in accordance with this section. (iv) Notification of sipc and sharing of information.--The Corporation shall identify to SIPC the customer accounts and associated customer name securities and customer property transferred to the bridge financial company. The Corporation and SIPC shall cooperate in the sharing of any information necessary for each entity to discharge its obligations under this title and under the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.) including by providing access to the books and records of the covered financial company and any bridge financial company established in accordance with this title. (2) Determination of claims.-- (A) In general.--The Corporation, as receiver for a covered financial company, shall report on claims, as set forth in section 203(c)(3). Subject to paragraph (4) of this subsection, the Corporation, as receiver for a covered financial company, shall determine claims in accordance with the requirements of this subsection and regulations prescribed under section 209. (B) Notice requirements.-- The Corporation, as receiver for a covered financial company, in any case involving the liquidation or winding up of the affairs of a covered financial company, shall-- (i) promptly publish a notice to the creditors of the covered financial company to present their claims, together with proof, to the receiver by a date specified in the notice, which shall be not earlier than 90 days after the date of publication of such notice; and (ii) republish such notice 1 month and 2 months, respectively, after the date of publication under clause (i). (C) Mailing required.--The Corporation as receiver shall mail a notice similar to the notice published under clause (i) or (ii) of subparagraph (B), at the time of such publication, to any creditor shown on the books and records of the covered financial company-- (i) at the last address of the creditor appearing in such books; (ii) in any claim filed by the claimant; or (iii) upon discovery of the name and address of a claimant not appearing on the books and records of the covered financial company, not later than 30

days after the date of the discovery of such name and address. (3) Procedures for resolution of claims.-- (A) Decision period.-- (i) In general.--Prior to the 180th day after the date on which a claim against a covered financial company is filed with the Corporation as receiver, or such later date as may be agreed as provided in clause (ii), the Corporation shall notify the claimant whether it allows or disallows the claim, in accordance with subparagraphs (B), (C), and (D). (ii) Extension of time.-- By written agreement executed not later than 180 days after the date on which a claim against a covered financial company is filed with the Corporation, the period described in clause (i) may be extended by written agreement between the claimant and the Corporation. Failure to notify the claimant of any disallowance within the time period set forth in clause (i), as it may be extended by agreement under this clause, shall be deemed to be a disallowance of such claim, and the claimant may file or continue an action in court, as provided in paragraph (4). (iii) Mailing of notice sufficient.--The requirements of clause (i) shall be deemed to be satisfied if the notice of any decision with respect to any claim is mailed to the last address of the claimant which appears-- (I) on the books, records, or both of the covered financial company; (II) in the claim filed by the claimant; or (III) in documents submitted in proof of the claim. (iv) Contents of notice of disallowance.--If the Corporation as receiver disallows any claim filed under clause (i), the notice to the claimant shall contain-- (I) a statement of each reason for the disallowance; and (II) the procedures required to file or continue an action in court, as provided in paragraph (4). (B) Allowance of proven claim.--The receiver shall allow any claim received by the receiver on or before the date specified in the notice under paragraph (2)(B)(i), which is proved to the satisfaction of the receiver. (C) Disallowance of claims filed after end of filing period.-- (i) In general.--Except as provided in clause (ii), claims filed after the date specified in the notice published under paragraph (2)(B)(i) shall be disallowed, and such disallowance shall be final. (ii) Certain exceptions.--Clause (i) shall not apply with respect to any claim filed by a claimant after the date specified in the notice published under paragraph (2)(B)(i), and such claim may be considered by the receiver under subparagraph (B), if--

(I) the claimant did not receive notice of the appointment of the receiver in time to file such claim before such date; and (II) such claim is filed in time to permit payment of such claim. (D) Authority to disallow claims.-- (i) In general.--The Corporation may disallow any portion of any claim by a creditor or claim of a security, preference, setoff, or priority which is not proved to the satisfaction of the Corporation. (ii) Payments to undersecured creditors.--In the case of a claim against a covered financial company that is secured by any property or other asset of such covered financial company, the receiver-- (I) may treat the portion of such claim which exceeds an amount equal to the fair market value of such property or other asset as an unsecured claim; and (II) may not make any payment with respect to such unsecured portion of the claim, other than in connection with the disposition of all claims of unsecured creditors of the covered financial company. (iii) Exceptions.--No provision of this paragraph shall apply with respect to-- (I) any extension of credit from any Federal reserve bank, or the Corporation, to any covered financial company; or (II) subject to clause (ii), any legally enforceable and perfected security interest in the assets of the covered financial company securing any such extension of credit. (E) Legal effect of filing.-- (i) Statute of limitations tolled.--For purposes of any applicable statute of limitations, the filing of a claim with the receiver shall constitute a commencement of an action. (ii) No prejudice to other actions.--Subject to paragraph (8), the filing of a claim with the receiver shall not prejudice any right of the claimant to continue any action which was filed before the date of appointment of the receiver for the covered financial company. (4) Judicial determination of claims.-- (A) In general.--Subject to subparagraph (B), a claimant may file suit on a claim (or continue an action commenced before the date of appointment of the Corporation as receiver) in the district or territorial court of the United States for the district within which the principal place of business of the covered financial company is located (and such court shall have jurisdiction to hear such claim). (B) Timing.--A claim under subparagraph (A) may be filed before the end of the 60-day period beginning on the earlier of-- (i) the end of the period described in paragraph (3)(A)(i) (or, if extended by agreement of the Corporation and the claimant, the period described in paragraph (3)(A)(ii)) with respect to any claim against a

covered financial company for which the Corporation is receiver; or (ii) the date of any notice of disallowance of such claim pursuant to paragraph (3)(A)(i). (C) Statute of limitations.--If any claimant fails to file suit on such claim (or to continue an action on such claim commenced before the date of appointment of the Corporation as receiver) prior to the end of the 60- day period described in subparagraph (B), the claim shall be deemed to be disallowed (other than any portion of such claim which was allowed by the receiver) as of the end of such period, such disallowance shall be final, and the claimant shall have no further rights or remedies with respect to such claim. (5) Expedited determination of claims.-- (A) Procedure required.--The Corporation shall establish a procedure for expedited relief outside of the claims process established under paragraph (3), for any claimant that alleges-- (i) having a legally valid and enforceable or perfected security interest in property of a covered financial company or control of any legally valid and enforceable security entitlement in respect of any asset held by the covered financial company for which the Corporation has been appointed receiver; and (ii) that irreparable injury will occur if the claims procedure established under paragraph (3) is followed. (B) Determination period.--Prior to the end of the 90-day period beginning on the date on which a claim is filed in accordance with the procedures established pursuant to subparagraph (A), the Corporation shall-- (i) determine-- (I) whether to allow or disallow such claim, or any portion thereof; or (II) whether such claim should be determined pursuant to the procedures established pursuant to paragraph (3); (ii) notify the claimant of the determination; and (iii) if the claim is disallowed, provide a statement of each reason for the disallowance and the procedure for obtaining a judicial determination. (C) Period for filing or renewing suit.--Any claimant who files a request for expedited relief shall be permitted to file suit (or continue a suit filed before the date of appointment of the Corporation as receiver seeking a determination of the rights of the claimant with respect to such security interest (or such security entitlement) after the earlier of-- (i) the end of the 90-day period beginning on the date of the filing of a request for expedited relief; or (ii) the date on which the Corporation denies the claim or a portion thereof. (D) Statute of limitations.-- If an action described in subparagraph (C) is not filed, or the motion to renew a previously filed suit is not made, before the end of the 30-day period beginning on the date on which such action

or motion may be filed in accordance with subparagraph (C), the claim shall be deemed to be disallowed as of the end of such period (other than any portion of such claim which was allowed by the receiver), such disallowance shall be final, and the claimant shall have no further rights or remedies with respect to such claim. (E) Legal effect of filing.-- (i) Statute of limitations tolled.--For purposes of any applicable statute of limitations, the filing of a claim with the receiver shall constitute a commencement of an action. (ii) No prejudice to other actions.--Subject to paragraph (8), the filing of a claim with the receiver shall not prejudice any right of the claimant to continue any action which was filed before the appointment of the Corporation as receiver for the covered financial company. (6) Agreements against interest of the receiver.--No agreement that tends to diminish or defeat the interest of the Corporation as receiver in any asset acquired by the receiver under this section shall be valid against the receiver, unless such agreement-- (A) is in writing; (B) was executed by an authorized officer or representative of the covered financial company, or confirmed in the ordinary course of business by the covered financial company; and (C) has been, since the time of its execution, an official record of the company or the party claiming under the agreement provides documentation, acceptable to the receiver, of such agreement and its authorized execution or confirmation by the covered financial company. (7) Payment of claims.-- (A) In general.--Subject to subparagraph (B), the Corporation as receiver may, in its discretion and to the extent that funds are available, pay creditor claims, in such manner and amounts as are authorized under this section, which are-- (i) allowed by the receiver; (ii) approved by the receiver pursuant to a final determination pursuant to paragraph (3) or (5), as applicable; or (iii) determined by the final judgment of a court of competent jurisdiction. (B) Limitation.--A creditor shall, in no event, receive less than the amount that the creditor is entitled to receive under paragraphs (2) and (3) of subsection (d), as applicable. (C) Payment of dividends on claims.--The Corporation as receiver may, in its sole discretion, and to the extent otherwise permitted by this section, pay dividends on proven claims at any time, and no liability shall attach to the Corporation as receiver, by reason of any such payment or for failure to pay dividends to a claimant whose claim is not proved at the time of any such payment. (D) Rulemaking by the corporation.--The Corporation may prescribe such rules, including definitions of

terms, as the Corporation deems appropriate to establish an interest rate for or to make payments of post- insolvency interest to creditors holding proven claims against the receivership estate of a covered financial company, except that no such interest shall be paid until the Corporation as receiver has satisfied the principal amount of all creditor claims. (8) Suspension of legal actions.-- (A) In general.--After the appointment of the Corporation as receiver for a covered financial company, the Corporation may request a stay in any judicial action or proceeding in which such covered financial company is or becomes a party, for a period of not to exceed 90 days. (B) Grant of stay by all courts required.--Upon receipt of a request by the Corporation pursuant to subparagraph (A), the court shall grant such stay as to all parties. (9) Additional rights and duties.-- (A) Prior final adjudication.--The Corporation shall abide by any final, non-appealable judgment of any court of competent jurisdiction that was rendered before the appointment of the Corporation as receiver. (B) Rights and remedies of receiver.--In the event of any appealable judgment, the Corporation as receiver shall-- (i) have all the rights and remedies available to the covered financial company (before the date of appointment of the Corporation as receiver under section 202) and the Corporation, including removal to Federal court and all appellate rights; and (ii) not be required to post any bond in order to pursue such remedies. (C) No attachment or execution.--No attachment or execution may be issued by any court upon assets in the possession of the Corporation as receiver for a covered financial company. (D) Limitation on judicial review.--Except as otherwise provided in this title, no court shall have jurisdiction over-- (i) any claim or action for payment from, or any action seeking a determination of rights with respect to, the assets of any covered financial company for which the Corporation has been appointed receiver, including any assets which the Corporation may acquire from itself as such receiver; or (ii) any claim relating to any act or omission of such covered financial company or the Corporation as receiver. (E) Disposition of assets.--In exercising any right, power, privilege, or authority as receiver in connection with any covered financial company for which the Corporation is acting as receiver under this section, the Corporation shall, to the greatest extent practicable, conduct its operations in a manner that-- (i) maximizes the net present value return from the sale or disposition of such assets;

(ii) minimizes the amount of any loss realized in the resolution of cases; (iii) mitigates the potential for serious adverse effects to the financial system; (iv) ensures timely and adequate competition and fair and consistent treatment of offerors; and (v) prohibits discrimination on the basis of race, sex, or ethnic group in the solicitation and consideration of offers. (10) Statute of limitations for actions brought by receiver. -- (A) In general.--Notwithstanding any provision of any contract, the applicable statute of limitations with regard to any action brought by the Corporation as receiver for a covered financial company shall be-- (i) in the case of any contract claim, the longer of-- (I) the 6-year period beginning on the date on which the claim accrues; or (II) the period applicable under State law; and (ii) in the case of any tort claim, the longer of-- (I) the 3-year period beginning on the date on which the claim accrues; or (II) the period applicable under State law. (B) Date on which a claim accrues.--For purposes of subparagraph (A), the date on which the statute of limitations begins to run on any claim described in subparagraph (A) shall be the later of-- (i) the date of the appointment of the Corporation as receiver under this title; or (ii) the date on which the cause of action accrues. (C) Revival of expired state causes of action.-- (i) In general.--In the case of any tort claim described in clause (ii) for which the applicable statute of limitations under State law has expired not more than 5 years before the date of appointment of the Corporation as receiver for a covered financial company, the Corporation may bring an action as receiver on such claim without regard to the expiration of the statute of limitations. (ii) Claims described.--A tort claim referred to in clause (i) is a claim arising from fraud, intentional misconduct resulting in unjust enrichment, or intentional misconduct resulting in substantial loss to the covered financial company. (11) Avoidable transfers.-- (A) Fraudulent transfers.--The Corporation, as receiver for any covered financial company, may avoid a transfer of any interest of the covered financial company in property, or any obligation incurred by the covered financial company, that was made or incurred at or within 2 years before the date on which the Corporation was appointed receiver, if-- (i) the covered financial company voluntarily or involuntarily-- (I) made such transfer or incurred such obligation with actual intent to hinder, delay, or defraud

any entity to which the covered financial company was or became, on or after the date on which such transfer was made or such obligation was incurred, indebted; or (II) received less than a reasonably equivalent value in exchange for such transferor obligation; and (ii) the covered financial company voluntarily or involuntarily-- (I) was insolvent on the date that such transfer was made or such obligation was incurred, or became insolvent as a result of such transfer or obligation; (II) was engaged in business or a transaction, or was about to engage in business or a transaction, for which any property remaining with the covered financial company was an unreasonably small capital; (III) intended to incur, or believed that the covered financial company would incur, debts that would be beyond the ability of the covered financial company to pay as such debts matured; or (IV) made such transfer to or for the benefit of an insider, or incurred such obligation to or for the benefit of an insider, under an employment contract and not in the ordinary course of business. (B) Preferential transfers.--The Corporation as receiver for any covered financial company may avoid a transfer of an interest of the covered financial company in property-- (i) to or for the benefit of a creditor; (ii) for or on account of an antecedent debt that was owed by the covered financial company before the transfer was made; (iii) that was made while the covered financial company was insolvent; (iv) that was made-- (I) 90 days or less before the date on which the Corporation was appointed receiver; or (II) more than 90 days, but less than 1 year before the date on which the Corporation was appointed receiver, if such creditor at the time of the transfer was an insider; and (v) that enables the creditor to receive more than the creditor would receive if-- (I) the covered financial company had been liquidated under chapter 7 of the Bankruptcy Code; (II) the transfer had not been made; and (III) the creditor received payment of such debt to the extent provided by the provisions of chapter 7 of the Bankruptcy Code. (C) Post-receivership transactions.--The Corporation as receiver for any covered financial company may avoid a transfer of property of the receivership that occurred after the Corporation was appointed receiver that

was not authorized under this title by the Corporation as receiver. (D) Right of recovery.--To the extent that a transfer is avoided under subparagraph (A), (B), or (C), the Corporation may recover, for the benefit of the covered financial company, the property transferred or, if a court so orders, the value of such property (at the time of such transfer) from-- (i) the initial transferee of such transfer or the person for whose benefit such transfer was made; or (ii) any immediate or mediate transferee of any such initial transferee. (E) Rights of transferee or obligee.--The Corporation may not recover under subparagraph (D)(ii) from-- (i) any transferee that takes for value, including in satisfaction of or to secure a present or antecedent debt, in good faith, and without knowledge of the voidability of the transfer avoided; or (ii) any immediate or mediate good faith transferee of such transferee. (F) Defenses.--Subject to the other provisions of this title-- (i) a transferee or obligee from which the Corporation seeks to recover a transfer or to avoid an obligation under subparagraph (A), (B), (C), or (D) shall have the same defenses available to a transferee or obligee from which a trustee seeks to recover a transfer or avoid an obligation under sections 547, 548, and 549 of the Bankruptcy Code; and (ii) the authority of the Corporation to recover a transfer or avoid an obligation shall be subject to subsections (b) and (c) of section 546,
section 547(c), and section 548(c) of the
Bankruptcy Code.
(G) Rights under this section.--The rights of the Corporation as receiver under this section shall be superior to any rights of a trustee or any other party (other than a Federal agency) under the Bankruptcy Code. (H) Rules of construction; definitions.--For purposes of-- (i) subparagraphs (A) and (B)-- (I) the term “insider” has the same meaning as in section 101(31) of the Bankruptcy Code; (II) a transfer is made when such transfer is so perfected that a bona fide purchaser from the covered financial company against whom applicable law permits such transfer to be perfected cannot acquire an interest in the property transferred that is superior to the interest in such property of the transferee, but if such transfer is not so perfected before the date on which the Corporation is appointed as receiver for the covered financial company, such transfer is made immediately before the date of such appointment; and (III) the term “value” means property, or satisfaction or securing of a present or antecedent debt of the covered financial company, but does not

include an unperformed promise to furnish support to the covered financial company; and (ii) subparagraph (B)-- (I) the covered financial company is presumed to have been insolvent on and during the 90-day period immediately preceding the date of appointment of the Corporation as receiver; and (II) the term “insolvent” has the same meaning as in section 101(32) of the Bankruptcy Code. (12) Setoff.-- (A) Generally.--Except as otherwise provided in this title, any right of a creditor to offset a mutual debt owed by the creditor to any covered financial company that arose before the Corporation was appointed as receiver for the covered financial company against a claim of such creditor may be asserted if enforceable under applicable noninsolvency law, except to the extent that-- (i) the claim of the creditor against the covered financial company is disallowed; (ii) the claim was transferred, by an entity other than the covered financial company, to the creditor-- (I) after the Corporation was appointed as receiver of the covered financial company; or (II)(aa) after the 90-day period preceding the date on which the Corporation was appointed as receiver for the covered financial company; and (bb) while the covered financial company was insolvent (except for a setoff in connection with a qualified financial contract); or (iii) the debt owed to the covered financial company was incurred by the covered financial company-- (I) after the 90-day period preceding the date on which the Corporation was appointed as receiver for the covered financial company; (II) while the covered financial company was insolvent; and (III) for the purpose of obtaining a right of setoff against the covered financial company (except for a setoff in connection with a qualified financial contract). (B) Insufficiency.-- (i) In general.--Except with respect to a setoff in connection with a qualified financial contract, if a creditor offsets a mutual debt owed to the covered financial company against a claim of the covered financial company on or within the 90-day period preceding the date on which the Corporation is appointed as receiver for the covered financial company, the Corporation may recover from the creditor the amount so offset, to the extent that any insufficiency on the date of such setoff is less than the insufficiency on the later of-- (I) the date that is 90 days before the date on which the Corporation is appointed as receiver for the covered financial company; or (II) the first day on which there is an insufficiency during the 90-day period preceding the date

on which the Corporation is appointed as receiver for the covered financial company. (ii) Definition of insufficiency.--In this subparagraph, the term “insufficiency” means the amount, if any, by which a claim against the covered financial company exceeds a mutual debt owed to the covered financial company by the holder of such claim. (C) Insolvency.--The term “insolvent” has the same meaning as in section 101(32) of the Bankruptcy Code. (D) Presumption of insolvency.--For purposes of this paragraph, the covered financial company is presumed to have been insolvent on and during the 90-day period preceding the date of appointment of the Corporation as receiver. (E) Limitation.--Nothing in this paragraph (12) shall be the basis for any right of setoff where no such right exists under applicable noninsolvency law. (F) Priority claim.--Except as otherwise provided in this title, the Corporation as receiver for the covered financial company may sell or transfer any assets free and clear of the setoff rights of any party, except that such party shall be entitled to a claim, subordinate to the claims payable under subparagraphs (A), (B), (C), and (D) of subsection (b)(1), but senior to all other unsecured liabilities defined in subsection (b)(1)(E), in an amount equal to the value of such setoff rights. (13) Attachment of assets and other injunctive relief.-- Subject to paragraph (14), any court of competent jurisdiction may, at the request of the Corporation as receiver for a covered financial company, issue an order in accordance with Rule 65 of the Federal Rules of Civil Procedure, including an order placing the assets of any person designated by the Corporation under the control of the court and appointing a trustee to hold such assets. (14) Standards.-- (A) Showing.--Rule 65 of the Federal Rules of Civil Procedure shall apply with respect to any proceeding under paragraph (13), without regard to the requirement that the applicant show that the injury, loss, or damage is irreparable and immediate. (B) State proceeding.--If, in the case of any proceeding in a State court, the court determines that rules of civil procedure available under the laws of the State provide substantially similar protections of the right of the parties to due process as provided under Rule 65 (as modified with respect to such proceeding by subparagraph (A)), the relief sought by the Corporation pursuant to paragraph (14) may be requested under the laws of such State. (15) Treatment of claims arising from breach of contracts executed by the corporation as receiver.--Notwithstanding any other provision of this title, any final and non-appealable judgment for monetary damages entered against the Corporation as receiver for a covered financial company for the breach of an agreement executed or approved by the Corporation after the date of its appointment shall be paid as an administrative expense of the receiver. Nothing in this paragraph shall be construed to limit the power of
a receiver

to exercise any rights under contract or law, including to terminate, breach, cancel, or otherwise discontinue such agreement. (16) Accounting and recordkeeping requirements.-- (A) In general.--The Corporation as receiver for a covered financial company shall, consistent with the accounting and reporting practices and procedures established by the Corporation, maintain a full accounting of each receivership or other disposition of any covered financial company. (B) Annual accounting or report.--With respect to each receivership to which the Corporation is appointed, the Corporation shall make an annual accounting or report, as appropriate, available to the Secretary and the Comptroller General of the United States. (C) Availability of reports.--Any report prepared pursuant to subparagraph (B) and section 203(c)(3) shall be made available to the public by the Corporation. (D) Recordkeeping requirement.-- (i) In general.-- The Corporation shall prescribe such regulations and establish such retention schedules as are necessary to maintain the documents and records of the Corporation generated in exercising the authorities of this title and the records of a covered financial company for which the Corporation is appointed receiver, with due regard for-- (I) the avoidance of duplicative record retention; and (II) the expected evidentiary needs of the Corporation as receiver for a covered financial company and the public regarding the records of covered financial companies. (ii) Retention of records.--Unless otherwise required by applicable Federal law or court order, the Corporation may not, at any time, destroy any records that are subject to clause (i). (iii) Records defined.--As used in this subparagraph, the terms “records” and “records of a covered financial company” mean any document, book, paper, map, photograph, microfiche, microfilm, computer or electronically- created record generated or maintained by the covered financial company in the course of and necessary to its transaction of business.

(b) Priority of Expenses and Unsecured Claims.-- (1) In general.--Unsecured claims against a covered financial company, or the Corporation as receiver for such covered financial company under this section, that are proven to the satisfaction of the receiver shall have priority in the following order:
(A) Administrative expenses of the receiver.
(B) Any amounts owed to the United States, unless the United States agrees or consents otherwise. (C) Wages, salaries, or commissions, including vacation, severance, and sick leave pay earned by an individual (other than an individual described in subparagraph (G)), but only to the extent of 11,725 for each individual (as indexed for inflation, by regulation of the Corporation)

earned not later than 180 days before the date of appointment of the Corporation as receiver. (D) Contributions owed to employee benefit plans arising from services rendered not later than 180 days before the date of appointment of the Corporation as receiver, to the extent of the number of employees covered by each such plan, multiplied by 11,725 (as indexed for inflation, by regulation of the Corporation), less the aggregate amount paid to such employees under subparagraph (C), plus the aggregate amount paid by the receivership on behalf of such employees to any other employee benefit plan. (E) Any other general or senior liability of the covered financial company (which is not a liability described under subparagraph (F), (G), or (H)). (F) Any obligation subordinated to general creditors (which is not an obligation described under subparagraph (G) or (H)). (G) Any wages, salaries, or commissions, including vacation, severance, and sick leave pay earned, owed to senior executives and directors of the covered financial company. (H) Any obligation to shareholders, members, general partners, limited partners, or other persons, with interests in the equity of the covered financial company arising as a result of their status as shareholders, members, general partners, limited partners, or other persons with interests in the equity of the covered financial company. (2) Post-receivership financing priority.--In the event that the Corporation, as receiver for a covered financial company, is unable to obtain unsecured credit for the covered financial company from commercial sources, the Corporation as receiver may obtain credit or incur debt on the part of the covered financial company, which shall have priority over any or all administrative expenses of the receiver under paragraph (1)(A). (3) Claims of the united states.--Unsecured claims of the United States shall, at a minimum, have a higher priority than liabilities of the covered financial company that count as regulatory capital. (4) Creditors similarly situated.--All claimants of a covered financial company that are similarly situated under paragraph (1) shall be treated in a similar manner, except that the Corporation may take any action (including making payments, subject to subsection (o)(1)(D)(i)) that does not comply with this subsection, if-- (A) the Corporation determines that such action is necessary-- (i) to maximize the value of the assets of the covered financial company; (ii) to initiate and continue operations essential to implementation of the receivership or any bridge financial company; (iii) to maximize the present value return from the sale or other disposition of the assets of the covered financial company; or

(iv) to minimize the amount of any loss realized upon the sale or other disposition of the assets of the covered financial company; and (B) all claimants that are similarly situated under paragraph (1) receive not less than the amount provided in paragraphs (2) and (3) of subsection (d). (5) Secured claims unaffected.--This section shall not affect secured claims or security entitlements in respect of assets or property held by the covered financial company, except to the extent that the security is insufficient to satisfy the claim, and then only with regard to the difference between the claim and the amount realized from the security. (6) Priority of expenses and unsecured claims in the orderly liquidation of sipc member.--Where the Corporation is appointed as receiver for a covered broker or dealer, unsecured claims against such covered broker or dealer, or the Corporation as receiver for such covered broker or dealer under this section, that are proven to the satisfaction of the receiver under
section 205(e), shall have the priority prescribed in paragraph
(1), except that--
(A) SIPC shall be entitled to recover administrative expenses incurred in performing its responsibilities under section 205 on an equal basis with the Corporation, in accordance with paragraph (1)(A); (B) the Corporation shall be entitled to recover any amounts paid to customers or to SIPC pursuant to section 205(f), in accordance with paragraph (1)(B); (C) SIPC shall be entitled to recover any amounts paid out of the SIPC Fund to meet its obligations under
section 205 and under the Securities Investor Protection
Act of 1970 (15 U.S.C. 78aaa et seq.), which claim shall be subordinate to the claims payable under subparagraphs (A) and (B) of paragraph (1), but senior to all other claims; and (D) the Corporation may, after paying any proven claims to customers under section 205 and the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.), and as provided above, pay dividends on other proven claims, in its discretion, and to the extent that funds are available, in accordance with the priorities set forth in paragraph (1).

(c) Provisions Relating to Contracts Entered Into Before Appointment of Receiver.-- (1) Authority to repudiate contracts.--In addition to any other rights that a receiver may have, the Corporation as receiver for any covered financial company may disaffirm or repudiate any contract or lease-- (A) to which the covered financial company is a party; (B) the performance of which the Corporation as receiver, in the discretion of the Corporation, determines to be burdensome; and (C) the disaffirmance or repudiation of which the Corporation as receiver determines, in the discretion of the Corporation, will promote the orderly administration of the affairs of the covered financial company. (2) Timing of repudiation.--The Corporation, as receiver for any covered financial company, shall determine whether

or not to exercise the rights of repudiation under this section within a reasonable period of time. (3) Claims for damages for repudiation.-- (A) In general.--Except as provided in paragraphs (4), (5), and (6) and in subparagraphs (C), (D), and (E) of this paragraph, the liability of the Corporation as receiver for a covered financial company for the disaffirmance or repudiation of any contract pursuant to paragraph (1) shall be-- (i) limited to actual direct compensatory damages; and (ii) determined as of-- (I) the date of the appointment of the Corporation as receiver; or (II) in the case of any contract or agreement referred to in paragraph (8), the date of the disaffirmance or repudiation of such contract or agreement. (B) No liability for other damages.--For purposes of subparagraph (A), the term “actual direct compensatory damages” does not include-- (i) punitive or exemplary damages; (ii) damages for lost profits or opportunity; or (iii) damages for pain and suffering. (C) Measure of damages for repudiation of qualified financial contracts.--In the case of any qualified financial contract or agreement to which paragraph (8) applies, compensatory damages shall be-- (i) deemed to include normal and reasonable costs of cover or other reasonable measures of damages utilized in the industries for such contract and agreement claims; and (ii) paid in accordance with this paragraph and subsection (d), except as otherwise specifically provided in this subsection. (D) Measure of damages for repudiation or disaffirmance of debt obligation.--In the case of any debt for borrowed money or evidenced by a security, actual direct compensatory damages shall be no less than the amount lent plus accrued interest plus any accreted original issue discount as of the date the Corporation was appointed receiver of the covered financial company and, to the extent that an allowed secured claim is secured by property the value of which is greater than the amount of such claim and any accrued interest through the date of repudiation or disaffirmance, such accrued interest pursuant to paragraph (1). (E) Measure of damages for repudiation or disaffirmance of contingent obligation.--In the case of any contingent obligation of a covered financial company consisting of any obligation under a guarantee, letter of credit, loan commitment, or similar credit obligation, the Corporation may, by rule or regulation, prescribe that actual direct compensatory damages shall be no less than the estimated value of the claim as of the date the Corporation was appointed receiver of the covered financial company, as such value is measured based on the likelihood

that such contingent claim would become fixed and the probable magnitude thereof. (4) Leases under which the covered financial company is the lessee.-- (A) In general.--If the Corporation as receiver disaffirms or repudiates a lease under which the covered financial company is the lessee, the receiver shall not be liable for any damages (other than damages determined pursuant to subparagraph (B)) for the disaffirmance or repudiation of such lease. (B) Payments of rent.--Notwithstanding subparagraph (A), the lessor under a lease to which subparagraph (A) would otherwise apply shall-- (i) be entitled to the contractual rent accruing before the later of the date on which-- (I) the notice of disaffirmance or repudiation is mailed; or (II) the disaffirmance or repudiation becomes effective, unless the lessor is in default or breach of the terms of the lease; (ii) have no claim for damages under any acceleration clause or other penalty provision in the lease; and (iii) have a claim for any unpaid rent, subject to all appropriate offsets and defenses, due as of the date of the appointment which shall be paid in accordance with this paragraph and subsection (d). (5) Leases under which the covered financial company is the lessor.-- (A) In general.--If the Corporation as receiver for a covered financial company repudiates an unexpired written lease of real property of the covered financial company under which the covered financial company is the lessor and the lessee is not, as of the date of such repudiation, in default, the lessee under such lease may either-- (i) treat the lease as terminated by such repudiation; or (ii) remain in possession of the leasehold interest for the balance of the term of the lease, unless the lessee defaults under the terms of the lease after the date of such repudiation. (B) Provisions applicable to lessee remaining in possession.--If any lessee under a lease described in subparagraph (A) remains in possession of a leasehold interest pursuant to clause (ii) of subparagraph (A)-- (i) the lessee-- (I) shall continue to pay the contractual rent pursuant to the terms of the lease after the date of the repudiation of such lease; and (II) may offset against any rent payment which accrues after the date of the repudiation of the lease, any damages which accrue after such date due to the nonperformance of any obligation of the covered financial company under the lease after such date; and (ii) the Corporation as receiver shall not be liable to the lessee for any damages arising after such date

as a result of the repudiation, other than the amount of any offset allowed under clause (i)(II). (6) Contracts for the sale of real property.-- (A) In general.--If the receiver repudiates any contract (which meets the requirements of subsection (a)(6)) for the sale of real property, and the purchaser of such real property under such contract is in possession and is not, as of the date of such repudiation, in default, such purchaser may either-- (i) treat the contract as terminated by such repudiation; or (ii) remain in possession of such real property. (B) Provisions applicable to purchaser remaining in possession.--If any purchaser of real property under any contract described in subparagraph (A) remains in possession of such property pursuant to clause (ii) of subparagraph (A)-- (i) the purchaser-- (I) shall continue to make all payments due under the contract after the date of the repudiation of the contract; and (II) may offset against any such payments any damages which accrue after such date due to the nonperformance (after such date) of any obligation of the covered financial company under the contract; and (ii) the Corporation as receiver shall-- (I) not be liable to the purchaser for any damages arising after such date as a result of the repudiation, other than the amount of any offset allowed under clause (i)(II); (II) deliver title to the purchaser in accordance with the provisions of the contract; and (III) have no obligation under the contract other than the performance required under subclause (II). (C) Assignment and sale allowed.-- (i) In general.--No provision of this paragraph shall be construed as limiting the right of the Corporation as receiver to assign the contract described in subparagraph (A) and sell the property, subject to the contract and the provisions of this paragraph. (ii) No liability after assignment and sale.-- If an assignment and sale described in clause (i) is consummated, the Corporation as receiver shall have no further liability under the contract described in subparagraph (A) or with respect to the real property which was the subject of such contract. (7) Provisions applicable to service contracts.-- (A) Services performed before appointment.--In the case of any contract for services between any person and any covered financial company for which the Corporation has been appointed receiver, any claim of such person for services performed before the date of appointment shall be-- (i) a claim to be paid in accordance with subsections (a), (b), and (d); and

(ii) deemed to have arisen as of the date on which the receiver was appointed. (B) Services performed after appointment and prior to repudiation.--If, in the case of any contract for services described in subparagraph (A), the Corporation as receiver accepts performance by the other person before making any determination to exercise the right of repudiation of such contract under this section-- (i) the other party shall be paid under the terms of the contract for the services performed; and (ii) the amount of such payment shall be treated as an administrative expense of the receivership. (C) Acceptance of performance no bar to subsequent repudiation.--The acceptance by the Corporation as receiver for services referred to in subparagraph (B) in connection with a contract described in subparagraph (B) shall not affect the right of the Corporation as receiver to repudiate such contract under this section at any time after such performance. (8) Certain qualified financial contracts.-- (A) Rights of parties to contracts.--Subject to subsection (a)(8) and paragraphs (9) and (10) of this subsection, and notwithstanding any other provision of this section, any other provision of Federal law, or the law of any State, no person shall be stayed or prohibited from exercising-- (i) any right that such person has to cause the termination, liquidation, or acceleration of any qualified financial contract with a covered financial company which arises upon the date of appointment of the Corporation as receiver for such covered financial company or at any time after such appointment; (ii) any right under any security agreement or arrangement or other credit enhancement related to one or more qualified financial contracts described in clause (i); or (iii) any right to offset or net out any termination value, payment amount, or other transfer obligation arising under or in connection with 1 or more contracts or agreements described in clause (i), including any master agreement for such contracts or agreements. (B) Applicability of other provisions.--Subsection (a)(8) shall apply in the case of any judicial action or proceeding brought against the Corporation as receiver referred to in subparagraph (A), or the subject covered financial company, by any party to a contract or agreement described in subparagraph (A)(i) with such covered financial company. (C) Certain transfers not avoidable.-- (i) In general.--Notwithstanding subsection (a)(11), (a)(12), or (c)(12), section 5242 of the Revised Statutes of the United States, or any other provision of Federal or State law relating to the avoidance of preferential or fraudulent transfers, the Corporation, whether acting as the Corporation or as receiver for a covered financial company, may not avoid any transfer of money or other property in connection with

any qualified financial contract with a covered financial company. (ii) Exception for certain transfers.--Clause (i) shall not apply to any transfer of money or other property in connection with any qualified financial contract with a covered financial company if the transferee had actual intent to hinder, delay, or defraud such company, the creditors of such company, or the Corporation as receiver appointed for such company. (D) Certain contracts and agreements defined.--For purposes of this subsection, the following definitions shall apply:
(i) Qualified financial contract.--The term “qualified financial contract” means any securities contract, commodity contract, forward contract, repurchase agreement, swap agreement, and any similar agreement that the Corporation determines by regulation, resolution, or order to be a qualified financial contract for purposes of this paragraph. (ii) Securities contract.--The term “securities contract”-- (I) means a contract for the purchase, sale, or loan of a security, a certificate of deposit, a mortgage loan, any interest in a mortgage loan, a group or index of securities, certificates of deposit, or mortgage loans or interests therein (including any interest therein or based on the value thereof), or any option on any of the foregoing, including any option to purchase or sell any such security, certificate of deposit, mortgage loan, interest, group or index, or option, and including any repurchase or reverse repurchase transaction on any such security, certificate of deposit, mortgage loan, interest, group or index, or option (whether or not such repurchase or reverse repurchase transaction is a “repurchase agreement”, as defined in clause (v)); (II) does not include any purchase, sale, or repurchase obligation under a participation in a commercial mortgage loan unless the Corporation determines by regulation, resolution, or order to include any such agreement within the meaning of such term; (III) means any option entered into on a national securities exchange relating to foreign currencies; (IV) means the guarantee (including by novation) by or to any securities clearing agency of any settlement of cash, securities, certificates of deposit, mortgage loans or interests therein, group or index of securities, certificates of deposit or mortgage loans or interests therein (including any interest therein or based on the value thereof) or an option on any of the foregoing, including any option to purchase or sell any such security, certificate of deposit, mortgage loan, interest, group or index, or option (whether or not such

settlement is in connection with any agreement or transaction referred to in subclauses (I) through (XII) (other than subclause (II))); (V) means any margin loan; (VI) means any extension of credit for the clearance or settlement of securities transactions; (VII) means any loan transaction coupled with a securities collar transaction, any prepaid securities forward transaction, or any total return swap transaction coupled with a securities sale transaction; (VIII) means any other agreement or transaction that is similar to any agreement or transaction referred to in this clause; (IX) means any combination of the agreements or transactions referred to in this clause; (X) means any option to enter into any agreement or transaction referred to in this clause; (XI) means a master agreement that provides for an agreement or transaction referred to in any of subclauses (I) through (X), other than subclause (II), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a securities contract under this clause, except that the master agreement shall be considered to be a securities contract under this clause only with respect to each agreement or transaction under the master agreement that is referred to in any of subclauses (I) through (X), other than subclause (II); and (XII) means any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in this clause, including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in this clause. (iii) Commodity contract.--The term “commodity contract” means-- (I) with respect to a futures commission merchant, a contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a contract market or board of trade; (II) with respect to a foreign futures commission merchant, a foreign future; (III) with respect to a leverage transaction merchant, a leverage transaction; (IV) with respect to a clearing organization, a contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a contract market or board of trade that is cleared by such clearing organization, or commodity option traded on, or subject to the rules of, a contract market or board of trade that is cleared by such clearing organization; (V) with respect to a commodity options dealer, a commodity option;

(VI) any other agreement or transaction that is similar to any agreement or transaction referred to in this clause; (VII) any combination of the agreements or transactions referred to in this clause; (VIII) any option to enter into any agreement or transaction referred to in this clause; (IX) a master agreement that provides for an agreement or transaction referred to in any of subclauses (I) through (VIII), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a commodity contract under this clause, except that the master agreement shall be considered to be a commodity contract under this clause only with respect to each agreement or transaction under the master agreement that is referred to in any of subclauses (I) through (VIII); or (X) any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in this clause, including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in this clause. (iv) Forward contract.--The term “forward contract” means-- (I) a contract (other than a commodity contract) for the purchase, sale, or transfer of a commodity or any similar good, article, service, right, or interest which is presently or in the future becomes the subject of dealing in the forward contract trade, or product or byproduct thereof, with a maturity date that is more than 2 days after the date on which the contract is entered into, including a repurchase or reverse repurchase transaction (whether or not such repurchase or reverse repurchase transaction is a “repurchase agreement”, as defined in clause (v)), consignment, lease, swap, hedge transaction, deposit, loan, option, allocated transaction, unallocated transaction, or any other similar agreement; (II) any combination of agreements or transactions referred to in subclauses (I) and (III); (III) any option to enter into any agreement or transaction referred to in subclause (I) or (II); (IV) a master agreement that provides for an agreement or transaction referred to in subclause (I), (II), or (III), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a forward contract under this clause, except that the master agreement shall be considered to be a forward contract under this clause only with respect to each agreement or transaction under the master

agreement that is referred to in subclause (I), (II), or (III); or (V) any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in subclause (I), (II), (III), or (IV), including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in any such subclause. (v) Repurchase agreement.--The term “repurchase agreement” (which definition also applies to a reverse repurchase agreement)-- (I) means an agreement, including related terms, which provides for the transfer of one or more certificates of deposit, mortgage related securities (as such term is defined in section 3 of the Securities Exchange Act of 1934), mortgage loans, interests in mortgage- related securities or mortgage loans, eligible bankers' acceptances, qualified foreign government securities (which, for purposes of this clause, means a security that is a direct obligation of, or that is fully guaranteed by, the central government of a member of the Organization for Economic Cooperation and Development, as determined by regulation or order adopted by the Board of Governors), or securities that are direct obligations of, or that are fully guaranteed by, the United States or any agency of the United States against the transfer of funds by the transferee of such certificates of deposit, eligible bankers' acceptances, securities, mortgage loans, or interests with a simultaneous agreement by such transferee to transfer to the transferor thereof certificates of deposit, eligible bankers' acceptances, securities, mortgage loans, or interests as described above, at a date certain not later than 1 year after such transfers or on demand, against the transfer of funds, or any other similar agreement; (II) does not include any repurchase obligation under a participation in a commercial mortgage loan, unless the Corporation determines, by regulation, resolution, or order to include any such participation within the meaning of such term; (III) means any combination of agreements or transactions referred to in subclauses (I) and (IV); (IV) means any option to enter into any agreement or transaction referred to in subclause (I) or (III); (V) means a master agreement that provides for an agreement or transaction referred to in subclause (I), (III), or (IV), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a repurchase agreement under this clause, except

that the master agreement shall be considered to be a repurchase agreement under this subclause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (III), or (IV); and (VI) means any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in subclause (I), (III), (IV), or (V), including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in any such subclause. (vi) Swap agreement.--The term “swap agreement” means-- (I) any agreement, including the terms and conditions incorporated by reference in any such agreement, which is an interest rate swap, option, future, or forward agreement, including a rate floor, rate cap, rate collar, cross-currency rate swap, and basis swap; a spot, same day-tomorrow, tomorrow-next, forward, or other foreign exchange, precious metals, or other commodity agreement; a currency swap, option, future, or forward agreement; an equity index or equity swap, option, future, or forward agreement; a debt index or debt swap, option, future, or forward agreement; a total return, credit spread or credit swap, option, future, or forward agreement; a commodity index or commodity swap, option, future, or forward agreement; weather swap, option, future, or forward agreement; an emissions swap, option, future, or forward agreement; or an inflation swap, option, future, or forward agreement; (II) any agreement or transaction that is similar to any other agreement or transaction referred to in this clause and that is of a type that has been, is presently, or in the future becomes, the subject of recurrent dealings in the swap or other derivatives markets (including terms and conditions incorporated by reference in such agreement) and that is a forward, swap, future, option, or spot transaction on one or more rates, currencies, commodities, equity securities or other equity instruments, debt securities or other debt instruments, quantitative measures associated with an occurrence, extent of an occurrence, or contingency associated with a financial, commercial, or economic consequence, or economic or financial indices or measures of economic or financial risk or value; (III) any combination of agreements or transactions referred to in this clause; (IV) any option to enter into any agreement or transaction referred to in this clause; (V) a master agreement that provides for an agreement or transaction referred to in subclause (I), (II), (III), or (IV), together with all supplements

to any such master agreement, without regard to whether the master agreement contains an agreement or transaction that is not a swap agreement under this clause, except that the master agreement shall be considered to be a swap agreement under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (II), (III), or (IV); and (VI) any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in any of subclauses (I) through (V), including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in any such clause. (vii) Definitions relating to default.--When used in this paragraph and paragraphs (9) and (10)-- (I) the term “default” means, with respect to a covered financial company, any adjudication or other official decision by any court of competent jurisdiction, or other public authority pursuant to which the Corporation has been appointed receiver; and (II) the term “in danger of default” means a covered financial company with respect to which the Corporation or appropriate State authority has determined that-- (aa) in the opinion of the Corporation or such authority-- (AA) the covered financial company is not likely to be able to pay its obligations in the normal course of business; and (BB) there is no reasonable prospect that the covered financial company will be able to pay such obligations without Federal assistance; or (bb) in the opinion of the Corporation or such authority-- (AA) the covered financial company has incurred or is likely to incur losses that will deplete all or substantially all of its capital; and (BB) there is no reasonable prospect that the capital will be replenished without Federal assistance. (viii) Treatment of master agreement as one agreement.--Any master agreement for any contract or agreement described in any of clauses (i) through (vi) (or any master agreement for such master agreement or agreements), together with all supplements to such master agreement, shall be treated as a single agreement and a single qualified financial contact. If a master agreement contains provisions relating to agreements or transactions that are not themselves qualified financial contracts, the master agreement

shall be deemed to be a qualified financial contract only with respect to those transactions that are themselves qualified financial contracts. (ix) Transfer.--The term “transfer” means every mode, direct or indirect, absolute or conditional, voluntary or involuntary, of disposing of or parting with property or with an interest in property, including retention of title as a security interest and foreclosure of the equity of redemption of the covered financial company. (x) Person.--The term “person” includes any governmental entity in addition to any entity included in the definition of such term in section 1, title 1, United States Code. (E) Clarification.--No provision of law shall be construed as limiting the right or power of the Corporation, or authorizing any court or agency to limit or delay, in any manner, the right or power of the Corporation to transfer any qualified financial contract or to disaffirm or repudiate any such contract in accordance with this subsection. (F) Walkaway clauses not effective.-- (i) In general.--Notwithstanding the provisions of subparagraph (A) of this paragraph and sections 403 and 404 of the Federal Deposit Insurance Corporation Improvement Act of 1991, no walkaway clause shall be enforceable in a qualified financial contract of a covered financial company in default. (ii) Limited suspension of certain obligations.--In the case of a qualified financial contract referred to in clause (i), any payment or delivery obligations otherwise due from a party pursuant to the qualified financial contract shall be suspended from the time at which the Corporation is appointed as receiver until the earlier of-- (I) the time at which such party receives notice that such contract has been transferred pursuant to paragraph (10)(A); or (II) 5:00 p.m. (eastern time) on the business day following the date of the appointment of the Corporation as receiver. (iii) Walkaway clause defined.--For purposes of this subparagraph, the term “walkaway clause” means any provision in a qualified financial contract that suspends, conditions, or extinguishes a payment obligation of a party, in whole or in part, or does not create a payment obligation of a party that would otherwise exist, solely because of the status of such party as a nondefaulting party in connection with the insolvency of a covered financial company that is a party to the contract or the appointment of or the exercise of rights or powers by the Corporation as receiver for such covered financial company, and not as a result of the exercise by a party of any right to offset, setoff, or net obligations that exist under the contract, any other contract between those parties, or applicable law.

(G) Certain obligations to clearing organizations.-- In the event that the Corporation has been appointed as receiver for a covered financial company which is a party to any qualified financial contract cleared by or subject to the rules of a clearing organization (as defined in paragraph (9)(D)), the receiver shall use its best efforts to meet all margin, collateral, and settlement obligations of the covered financial company that arise under qualified financial contracts (other than any margin, collateral, or settlement obligation that is not enforceable against the receiver under paragraph (8)(F)(i) or paragraph (10)(B)), as required by the rules of the clearing organization when due. Notwithstanding any other provision of this title, if the receiver fails to satisfy any such margin, collateral, or settlement obligations under the rules of the clearing organization, the clearing organization shall have the immediate right to exercise, and shall not be stayed from exercising, all of its rights and remedies under its rules and applicable law with respect to any qualified financial contract of the covered financial company, including, without limitation, the right to liquidate all positions and collateral of such covered financial company under the company's qualified financial contracts, and suspend or cease to act for such covered financial company, all in accordance with the rules of the clearing organization. (H) Recordkeeping.-- (i) Joint rulemaking.--The Federal primary financial regulatory agencies shall jointly prescribe regulations requiring that financial companies maintain such records with respect to qualified financial contracts (including market valuations) that the Federal primary financial regulatory agencies determine to be necessary or appropriate in order to assist the Corporation as receiver for a covered financial company in being able to exercise its rights and fulfill its obligations under this paragraph or paragraph (9) or (10). (ii) Time frame.--The Federal primary financial regulatory agencies shall prescribe joint final or interim final regulations not later than 24 months after the date of enactment of this Act. (iii) Back-up rulemaking authority.--If the Federal primary financial regulatory agencies do not prescribe joint final or interim final regulations within the time frame in clause (ii), the Chairperson of the Council shall prescribe, in consultation with the Corporation, the regulations required by clause (i). (iv) Categorization and tiering.--The joint regulations prescribed under clause (i) shall, as appropriate, differentiate among financial companies by taking into consideration their size, risk, complexity, leverage, frequency and dollar amount of qualified financial contracts, interconnectedness to the financial system, and any other factors deemed appropriate. (9) Transfer of qualified financial contracts.-- (A) In general.--In making any transfer of assets or liabilities of a covered financial company
in default,

which includes any qualified financial contract, the Corporation as receiver for such covered financial company shall either-- (i) transfer to one financial institution, other than a financial institution for which a conservator, receiver, trustee in bankruptcy, or other legal custodian has been appointed or which is otherwise the subject of a bankruptcy or insolvency proceeding-- (I) all qualified financial contracts between any person or any affiliate of such person and the covered financial company in default; (II) all claims of such person or any affiliate of such person against such covered financial company under any such contract (other than any claim which, under the terms of any such contract, is subordinated to the claims of general unsecured creditors of such company); (III) all claims of such covered financial company against such person or any affiliate of such person under any such contract; and (IV) all property securing or any other credit enhancement for any contract described in subclause (I) or any claim described in subclause (II) or (III) under any such contract; or (ii) transfer none of the qualified financial contracts, claims, property or other credit enhancement referred to in clause (i) (with respect to such person and any affiliate of such person). (B) Transfer to foreign bank, financial institution, or branch or agency thereof.--In transferring any qualified financial contracts and related claims and property under subparagraph (A)(i), the Corporation as receiver for the covered financial company shall not make such transfer to a foreign bank, financial institution organized under the laws of a foreign country, or a branch or agency of a foreign bank or financial institution unless, under the law applicable to such bank, financial institution, branch or agency, to the qualified financial contracts, and to any netting contract, any security agreement or arrangement or other credit enhancement related to one or more qualified financial contracts, the contractual rights of the parties to such qualified financial contracts, netting contracts, security agreements or arrangements, or other credit enhancements are enforceable substantially to the same extent as permitted under this section. (C) Transfer of contracts subject to the rules of a clearing organization.--In the event that the Corporation as receiver for a financial institution transfers any qualified financial contract and related claims, property, or credit enhancement pursuant to subparagraph (A)(i) and such contract is cleared by or subject to the rules of a clearing organization, the clearing organization shall not be required to accept the transferee as a member by virtue of the transfer. (D) Definitions.--For purposes of this paragraph--

(i) the term “financial institution” means a broker or dealer, a depository institution, a futures commission merchant, a bridge financial company, or any other institution determined by the Corporation, by regulation, to be a financial institution; and (ii) the term “clearing organization” has the same meaning as in section 402 of the Federal Deposit Insurance Corporation Improvement Act of 1991. (10) Notification of transfer.-- (A) In general.-- (i) Notice.--The Corporation shall provide notice in accordance with clause (ii), if-- (I) the Corporation as receiver for a covered financial company in default or in danger of default transfers any assets or liabilities of the covered financial company; and (II) the transfer includes any qualified financial contract. (ii) Timing.--The Corporation as receiver for a covered financial company shall notify any person who is a party to any contract described in clause (i) of such transfer not later than 5:00 p.m. (eastern time) on the business day following the date of the appointment of the Corporation as receiver. (B) Certain rights not enforceable.-- (i) Receivership.--A person who is a party to a qualified financial contract with a covered financial company may not exercise any right that such person has to terminate, liquidate, or net such contract under paragraph (8)(A) solely by reason of or incidental to the appointment under this
section of the Corporation as receiver for the
covered financial company (or the insolvency or financial condition of the covered financial company for which the Corporation has been appointed as receiver)-- (I) until 5:00 p.m. (eastern time) on the business day following the date of the appointment; or (II) after the person has received notice that the contract has been transferred pursuant to paragraph (9)(A). (ii) Notice.--For purposes of this paragraph, the Corporation as receiver for a covered financial company shall be deemed to have notified a person who is a party to a qualified financial contract with such covered financial company, if the Corporation has taken steps reasonably calculated to provide notice to such person by the time specified in subparagraph (A). (C) Treatment of bridge financial company.--For purposes of paragraph (9), a bridge financial company shall not be considered to be a financial institution for which a conservator, receiver, trustee in bankruptcy, or other legal custodian has been appointed, or which is otherwise the subject of a bankruptcy or insolvency proceeding. (D) Business day defined.--For purposes of this paragraph, the term “business day” means any day other than any Saturday, Sunday, or any day on which either the

New York Stock Exchange or the Federal Reserve Bank of New York is closed. (11) Disaffirmance or repudiation of qualified financial contracts.--In exercising the rights of disaffirmance or repudiation of the Corporation as receiver with respect to any qualified financial contract to which a covered financial company is a party, the Corporation shall either-- (A) disaffirm or repudiate all qualified financial contracts between-- (i) any person or any affiliate of such person; and (ii) the covered financial company in default; or (B) disaffirm or repudiate none of the qualified financial contracts referred to in subparagraph (A) (with respect to such person or any affiliate of such person). (12) Certain security and customer interests not avoidable.--No provision of this subsection shall be construed as permitting the avoidance of any-- (A) legally enforceable or perfected security interest in any of the assets of any covered financial company, except in accordance with subsection (a)(11); or (B) legally enforceable interest in customer property, security entitlements in respect of assets or property held by the covered financial company for any security entitlement holder. (13) Authority to enforce contracts.-- (A) In general.--The Corporation, as receiver for a covered financial company, may enforce any contract, other than a liability insurance contract of a director or officer, a financial institution bond entered into by the covered financial company, notwithstanding any provision of the contract providing for termination, default, acceleration, or exercise of rights upon, or solely by reason of, insolvency, the appointment of or the exercise of rights or powers by the Corporation as receiver, the filing of the petition pursuant to section 202(a)(1), or the issuance of the recommendations or determination, or any actions or events occurring in connection therewith or as a result thereof, pursuant to
section 203.
(B) Certain rights not affected.--No provision of this paragraph may be construed as impairing or affecting any right of the Corporation as receiver to enforce or recover under a liability insurance contract of a director or officer or financial institution bond under other applicable law. (C) Consent requirement and ipso facto clauses.-- (i) In general.--Except as otherwise provided by this section, no person may exercise any right or power to terminate, accelerate, or declare a default under any contract to which the covered financial company is a party (and no provision in any such contract providing for such default, termination, or acceleration shall be enforceable), or to obtain possession of or exercise control over any property of the covered financial company or affect any contractual rights of the covered financial company, without the consent of the

Corporation as receiver for the covered financial company during the 90 day period beginning from the appointment of the Corporation as receiver. (ii) Exceptions.--No provision of this subparagraph shall apply to a director or officer liability insurance contract or a financial institution bond, to the rights of parties to certain qualified financial contracts pursuant to paragraph (8), or to the rights of parties to netting contracts pursuant to subtitle A of title IV of the Federal Deposit Insurance Corporation Improvement Act of 1991 (12 U.S.C. 4401 et seq.), or shall be construed as permitting the Corporation as receiver to fail to comply with otherwise enforceable provisions of such contract. (D) Contracts to extend credit.--Notwithstanding any other provision in this title, if the Corporation as receiver enforces any contract to extend credit to the covered financial company or bridge financial company, any valid and enforceable obligation to repay such debt shall be paid by the Corporation as receiver, as an administrative expense of the receivership. (14) Exception for federal reserve banks and corporation security interest.--No provision of this subsection shall apply with respect to-- (A) any extension of credit from any Federal reserve bank or the Corporation to any covered financial company; or (B) any security interest in the assets of the covered financial company securing any such extension of credit. (15) Savings clause.--The meanings of terms used in this subsection are applicable for purposes of this subsection only, and shall not be construed or applied so as to challenge or affect the characterization, definition, or treatment of any similar terms under any other statute, regulation, or rule, including the Gramm-Leach-Bliley Act, the Legal Certainty for Bank Products Act of 2000, the securities laws (as that term is defined in section 3(a)(47) of the Securities Exchange Act of 1934), and the Commodity Exchange Act. (16) Enforcement of contracts guaranteed by the covered financial company.-- (A) In general.--The Corporation, as receiver for a covered financial company or as receiver for a subsidiary of a covered financial company (including an insured depository institution) shall have the power to enforce contracts of subsidiaries or affiliates of the covered financial company, the obligations under which are guaranteed or otherwise supported by or linked to the covered financial company, notwithstanding any contractual right to cause the termination, liquidation, or acceleration of such contracts based solely on the insolvency, financial condition, or receivership of the covered financial company, if-- (i) such guaranty or other support and all related assets and liabilities are transferred to and assumed by a bridge financial company or a third party (other than a third party for which a conservator, receiver, trustee in bankruptcy, or other legal custodian has been appointed, or which is otherwise the subject of

a bankruptcy or insolvency proceeding) within the same period of time as the Corporation is entitled to transfer the qualified financial contracts of such covered financial company; or (ii) the Corporation, as receiver, otherwise provides adequate protection with respect to such obligations. (B) Rule of construction.--For purposes of this paragraph, a bridge financial company shall not be considered to be a third party for which a conservator, receiver, trustee in bankruptcy, or other legal custodian has been appointed, or which is otherwise the subject of a bankruptcy or insolvency proceeding.

(d) Valuation of Claims in Default.-- (1) In general.--Notwithstanding any other provision of Federal law or the law of any State, and regardless of the method utilized by the Corporation for a covered financial company, including transactions authorized under subsection (h), this subsection shall govern the rights of the creditors of any such covered financial company. (2) Maximum liability.--The maximum liability of the Corporation, acting as receiver for a covered financial company or in any other capacity, to any person having a claim against the Corporation as receiver or the covered financial company for which the Corporation is appointed shall equal the amount that such claimant would have received if-- (A) the Corporation had not been appointed receiver with respect to the covered financial company; and (B) the covered financial company had been liquidated under chapter 7 of the Bankruptcy Code, or any similar provision of State insolvency law applicable to the covered financial company. (3) Special provision for orderly liquidation by sipc.--The maximum liability of the Corporation, acting as receiver or in its corporate capacity for any covered broker or dealer to any customer of such covered broker or dealer, with respect to customer property of such customer, shall be-- (A) equal to the amount that such customer would have received with respect to such customer property in a case initiated by SIPC under the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.); and (B) determined as of the close of business on the date on which the Corporation is appointed as receiver. (4) Additional payments authorized.-- (A) In general.--Subject to subsection (o)(1)(D)(i), the Corporation, with the approval of the Secretary, may make additional payments or credit additional amounts to or with respect to or for the account of any claimant or category of claimants of the covered financial company, if the Corporation determines that such payments or credits are necessary or appropriate to minimize losses to the Corporation as receiver from the orderly liquidation of the covered financial company under this
section.
(B) Limitations.--
(i) Prohibition.--The Corporation shall not make any payments or credit amounts to any claimant or category of claimants that would result in any claimant receiving more than the face value amount of any

claim that is proven to the satisfaction of the Corporation. (ii) No obligation.--Notwithstanding any other provision of Federal or State law, or the Constitution of any State, the Corporation shall not be obligated, as a result of having made any payment under subparagraph (A) or credited any amount described in subparagraph (A) to or with respect to, or for the account, of any claimant or category of claimants, to make payments to any other claimant or category of claimants. (C) Manner of payment.--The Corporation may make payments or credit amounts under subparagraph (A) directly to the claimants or may make such payments or credit such amounts to a company other than a covered financial company or a bridge financial company established with respect thereto in order to induce such other company to accept liability for such claims.

(e) Limitation on Court Action.--Except as provided in this title, no court may take any action to restrain or affect the exercise of powers or functions of the receiver hereunder, and any remedy against the Corporation or receiver shall be limited to money damages determined in accordance with this title. (f) Liability of Directors and Officers.-- (1) In general.--A director or officer of a covered financial company may be held personally liable for monetary damages in any civil action described in paragraph (2) by, on behalf of, or at the request or direction of the Corporation, which action is prosecuted wholly or partially for the benefit of the Corporation-- (A) acting as receiver for such covered financial company; (B) acting based upon a suit, claim, or cause of action purchased from, assigned by, or otherwise conveyed by the Corporation as receiver; or (C) acting based upon a suit, claim, or cause of action purchased from, assigned by, or otherwise conveyed in whole or in part by a covered financial company or its affiliate in connection with assistance provided under this title. (2) Actions covered.--Paragraph (1) shall apply with respect to actions for gross negligence, including any similar conduct or conduct that demonstrates a greater disregard of a duty of care (than gross negligence) including intentional tortious conduct, as such terms are defined and determined under applicable State law. (3) Savings clause.--Nothing in this subsection shall impair or affect any right of the Corporation under other applicable law.

(g) Damages.--In any proceeding related to any claim against a director, officer, employee, agent, attorney, accountant, or appraiser of a covered financial company, or any other party employed by or providing services to a covered financial company, recoverable damages determined to result from the improvident or otherwise improper use or investment of any assets of the covered financial company shall include principal losses and appropriate interest.

(h) Bridge Financial Companies.-- (1) Organization.-- (A) Purpose.--The Corporation, as receiver for one or more covered financial companies or in anticipation of being appointed receiver for one or more covered financial companies, may organize one or more bridge financial companies in accordance with this subsection. (B) Authorities.--Upon the creation of a bridge financial company under subparagraph (A) with respect to a covered financial company, such bridge financial company may-- (i) assume such liabilities (including liabilities associated with any trust or custody business, but excluding any liabilities that count as regulatory capital) of such covered financial company as the Corporation may, in its discretion, determine to be appropriate; (ii) purchase such assets (including assets associated with any trust or custody business) of such covered financial company as the Corporation may, in its discretion, determine to be appropriate; and (iii) perform any other temporary function which the Corporation may, in its discretion, prescribe in accordance with this section. (2) Charter and establishment.-- (A) Establishment.--Except as provided in subparagraph (H), where the covered financial company is a covered broker or dealer, the Corporation, as receiver for a covered financial company, may grant a Federal charter to and approve articles of association for one or more bridge financial company or companies, with respect to such covered financial company which shall, by operation of law and immediately upon issuance of its charter and approval of its articles of association, be established and operate in accordance with, and subject to, such charter, articles, and this section. (B) Management.--Upon its establishment, a bridge financial company shall be under the management of a board of directors appointed by the Corporation. (C) Articles of association.--The articles of association and organization certificate of a bridge financial company shall have such terms as the Corporation may provide, and shall be executed by such representatives as the Corporation may designate. (D) Terms of charter; rights and privileges.-- Subject to and in accordance with the provisions of this subsection, the Corporation shall-- (i) establish the terms of the charter of a bridge financial company and the rights, powers, authorities, and privileges of a bridge financial company granted by the charter or as an incident thereto; and (ii) provide for, and establish the terms and conditions governing, the management (including the bylaws and the number of directors of the board of directors) and operations of the bridge financial company. (E) Transfer of rights and privileges of covered financial company.--

(i) In general.--Notwithstanding any other provision of Federal or State law, the Corporation may provide for a bridge financial company to succeed to and assume any rights, powers, authorities, or privileges of the covered financial company with respect to which the bridge financial company was established and, upon such determination by the Corporation, the bridge financial company shall immediately and by operation of law succeed to and assume such rights, powers, authorities, and privileges. (ii) Effective without approval.--Any succession to or assumption by a bridge financial company of rights, powers, authorities, or privileges of a covered financial company under clause (i) or otherwise shall be effective without any further approval under Federal or State law, assignment, or consent with respect thereto. (F) Corporate governance and election and designation of body of law.--To the extent permitted by the Corporation and consistent with this section and any rules, regulations, or directives issued by the Corporation under this section, a bridge financial company may elect to follow the corporate governance practices and procedures that are applicable to a corporation incorporated under the general corporation law of the State of Delaware, or the State of incorporation or organization of the covered financial company with respect to which the bridge financial company was established, as such law may be amended from time to time. (G) Capital.-- (i) Capital not required.--Notwithstanding any other provision of Federal or State law, a bridge financial company may, if permitted by the Corporation, operate without any capital or surplus, or with such capital or surplus as the Corporation may in its discretion determine to be appropriate. (ii) No contribution by the corporation required.--The Corporation is not required to pay capital into a bridge financial company or to issue any capital stock on behalf of a bridge financial company established under this subsection. (iii) Authority.--If the Corporation determines that such action is advisable, the Corporation may cause capital stock or other securities of a bridge financial company established with respect to a covered financial company to be issued and offered for sale in such amounts and on such terms and conditions as the Corporation may, in its discretion, determine. (iv) Operating funds in lieu of capital and implementation plan.--Upon the organization of a bridge financial company, and thereafter as the Corporation may, in its discretion, determine to be necessary or advisable, the Corporation may make available to the bridge financial company, subject to the plan described in subsection (n)(9), funds for the operation of the bridge financial company in lieu of capital. (H) Bridge brokers or dealers.--

(i) In general.--The Corporation, as receiver for a covered broker or dealer, may approve articles of association for one or more bridge financial companies with respect to such covered broker or dealer, which bridge financial company or companies shall, by operation of law and immediately upon approval of its articles of association-- (I) be established and deemed registered with the Commission under the Securities Exchange Act of 1934 and a member of SIPC; (II) operate in accordance with such articles and this section; and (III) succeed to any and all registrations and memberships of the covered financial company with or in any self-regulatory organizations. (ii) Other requirements.--Except as provided in clause (i), and notwithstanding any other provision of this section, the bridge financial company shall be subject to the Federal securities laws and all requirements with respect to being a member of a self-regulatory organization, unless exempted from any such requirements by the Commission, as is necessary or appropriate in the public interest or for the protection of investors. (iii) Treatment of customers.--Except as otherwise provided by this title, any customer of the covered broker or dealer whose account is transferred to a bridge financial company shall have all the rights, privileges, and protections under section 205(f) and under the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.), that such customer would have had if the account were not transferred from the covered financial company under this subparagraph. (iv) Operation of bridge brokers or dealers.-- Notwithstanding any other provision of this title, the Corporation shall not operate any bridge financial company created by the Corporation under this title with respect to a covered broker or dealer in such a manner as to adversely affect the ability of customers to promptly access their customer property in accordance with applicable law. (3) Interests in and assets and obligations of covered financial company.--Notwithstanding paragraph (1) or (2) or any other provision of law-- (A) a bridge financial company shall assume, acquire, or succeed to the assets or liabilities of a covered financial company (including the assets or liabilities associated with any trust or custody business) only to the extent that such assets or liabilities are transferred by the Corporation to the bridge financial company in accordance with, and subject to the restrictions set forth in, paragraph (1)(B); and (B) a bridge financial company shall not assume, acquire, or succeed to any obligation that a covered financial company for which the Corporation has been appointed receiver may have to any shareholder, member, general

partner, limited partner, or other person with an interest in the equity of the covered financial company that arises as a result of the status of that person having an equity claim in the covered financial company. (4) Bridge financial company treated as being in default for certain purposes.--A bridge financial company shall be treated as a covered financial company in default at such times and for such purposes as the Corporation may, in its discretion, determine. (5) Transfer of assets and liabilities.-- (A) Authority of corporation.--The Corporation, as receiver for a covered financial company, may transfer any assets and liabilities of a covered financial company (including any assets or liabilities associated with any trust or custody business) to one or more bridge financial companies, in accordance with and subject to the restrictions of paragraph (1). (B) Subsequent transfers.--At any time after the establishment of a bridge financial company with respect to a covered financial company, the Corporation, as receiver, may transfer any assets and liabilities of such covered financial company as the Corporation may, in its discretion, determine to be appropriate in accordance with and subject to the restrictions of paragraph (1). (C) Treatment of trust or custody business.--For purposes of this paragraph, the trust or custody business, including fiduciary appointments, held by any covered financial company is included among its assets and liabilities. (D) Effective without approval.--The transfer of any assets or liabilities, including those associated with any trust or custody business of a covered financial company, to a bridge financial company shall be effective without any further approval under Federal or State law, assignment, or consent with respect thereto. (E) Equitable treatment of similarly situated creditors.--The Corporation shall treat all creditors of a covered financial company that are similarly situated under subsection (b)(1), in a similar manner in exercising the authority of the Corporation under this subsection to transfer any assets or liabilities of the covered financial company to one or more bridge financial companies established with respect to such covered financial company, except that the Corporation may take any action (including making payments, subject to subsection (o)(1)(D)(i)) that does not comply with this subparagraph, if-- (i) the Corporation determines that such action is necessary-- (I) to maximize the value of the assets of the covered financial company; (II) to maximize the present value return from the sale or other disposition of the assets of the covered financial company; or (III) to minimize the amount of any loss realized upon the sale or other disposition of the assets of the covered financial company; and

(ii) all creditors that are similarly situated under subsection (b)(1) receive not less than the amount provided under paragraphs (2) and (3) of subsection (d). (F) Limitation on transfer of liabilities.-- Notwithstanding any other provision of law, the aggregate amount of liabilities of a covered financial company that are transferred to, or assumed by, a bridge financial company from a covered financial company may not exceed the aggregate amount of the assets of the covered financial company that are transferred to, or purchased by, the bridge financial company from the covered financial company. (6) Stay of judicial action.--Any judicial action to which a bridge financial company becomes a party by virtue of its acquisition of any assets or assumption of any liabilities of a covered financial company shall be stayed from further proceedings for a period of not longer than 45 days (or such longer period as may be agreed to upon the consent of all parties) at the request of the bridge financial company. (7) Agreements against interest of the bridge financial company.--No agreement that tends to diminish or defeat the interest of the bridge financial company in any asset of a covered financial company acquired by the bridge financial company shall be valid against the bridge financial company, unless such agreement-- (A) is in writing; (B) was executed by an authorized officer or representative of the covered financial company or confirmed in the ordinary course of business by the covered financial company; and (C) has been on the official record of the company, since the time of its execution, or with which, the party claiming under the agreement provides documentation of such agreement and its authorized execution or confirmation by the covered financial company that is acceptable to the receiver. (8) No federal status.-- (A) Agency status.--A bridge financial company is not an agency, establishment, or instrumentality of the United States. (B) Employee status.--Representatives for purposes of paragraph (1)(B), directors, officers, employees, or agents of a bridge financial company are not, solely by virtue of service in any such capacity, officers or employees of the United States. Any employee of the Corporation or of any Federal instrumentality who serves at the request of the Corporation as a representative for purposes of paragraph (1)(B), director, officer, employee, or agent of a bridge financial company shall not-- (i) solely by virtue of service in any such capacity lose any existing status as an officer or employee of the United States for purposes of title 5, United States Code, or any other provision of law; or (ii) receive any salary or benefits for service in any such capacity with respect to a bridge financial company in addition to such salary or benefits as are obtained through employment with the Corporation or such Federal instrumentality.

(9) Funding authorized.--The Corporation may, subject to the plan described in subsection (n)(9), provide funding to facilitate any transaction described in subparagraph (A), (B), (C), or (D) of paragraph (13) with respect to any bridge financial company, or facilitate the acquisition by a bridge financial company of any assets, or the assumption of any liabilities, of a covered financial company for which the Corporation has been appointed receiver. (10) Exempt tax status.--Notwithstanding any other provision of Federal or State law, a bridge financial company, its franchise, property, and income shall be exempt from all taxation now or hereafter imposed by the United States, by any territory, dependency, or possession thereof, or by any State, county, municipality, or local taxing authority. (11) Federal agency approval; antitrust review.--If a transaction involving the merger or sale of a bridge financial company requires approval by a Federal agency, the transaction may not be consummated before the 5th calendar day after the date of approval by the Federal agency responsible for such approval with respect thereto. If, in connection with any such approval a report on competitive factors from the Attorney General is required, the Federal agency responsible for such approval shall promptly notify the Attorney General of the proposed transaction and the Attorney General shall provide the required report within 10 days of the request. If a notification is required under
section 7A of the Clayton Act with respect to such transaction,
the required waiting period shall end on the 15th day after the date on which the Attorney General and the Federal Trade Commission receive such notification, unless the waiting period is terminated earlier under section 7A(b)(2) of the Clayton Act, or extended under section 7A(e)(2) of that Act. (12) Duration of bridge financial company.--Subject to paragraphs (13) and (14), the status of a bridge financial company as such shall terminate at the end of the 2-year period following the date on which it was granted a charter. The Corporation may, in its discretion, extend the status of the bridge financial company as such for no more than 3 additional 1-year periods. (13) Termination of bridge financial company status.--The status of any bridge financial company as such shall terminate upon the earliest of-- (A) the date of the merger or consolidation of the bridge financial company with a company that is not a bridge financial company; (B) at the election of the Corporation, the sale of a majority of the capital stock of the bridge financial company to a company other than the Corporation and other than another bridge financial company; (C) the sale of 80 percent, or more, of the capital stock of the bridge financial company to a person other than the Corporation and other than another bridge financial company; (D) at the election of the Corporation, either the assumption of all or substantially all of the liabilities of the bridge financial company by a company that is not a bridge financial company, or the acquisition of all or

substantially all of the assets of the bridge financial company by a company that is not a bridge financial company, or other entity as permitted under applicable law; and (E) the expiration of the period provided in paragraph (12), or the earlier dissolution of the bridge financial company, as provided in paragraph (15). (14) Effect of termination events.-- (A) Merger or consolidation.--A merger or consolidation, described in paragraph (13)(A) shall be conducted in accordance with, and shall have the effect provided in, the provisions of applicable law. For the purpose of effecting such a merger or consolidation, the bridge financial company shall be treated as a corporation organized under the laws of the State of Delaware (unless the law of another State has been selected by the bridge financial company in accordance with paragraph (2)(F)), and the Corporation shall be treated as the sole shareholder thereof, notwithstanding any other provision of State or Federal law. (B) Charter conversion.--Following the sale of a majority of the capital stock of the bridge financial company, as provided in paragraph (13)(B), the Corporation may amend the charter of the bridge financial company to reflect the termination of the status of the bridge financial company as such, whereupon the company shall have all of the rights, powers, and privileges under its constituent documents and applicable Federal or State law. In connection therewith, the Corporation may take such steps as may be necessary or convenient to reincorporate the bridge financial company under the laws of a State and, notwithstanding any provisions of Federal or State law, such State-chartered corporation shall be deemed to succeed by operation of law to such rights, titles, powers, and interests of the bridge financial company as the Corporation may provide, with the same effect as if the bridge financial company had merged with the State- chartered corporation under provisions of the corporate laws of such State. (C) Sale of stock.--Following the sale of 80 percent or more of the capital stock of a bridge financial company, as provided in paragraph (13)(C), the company shall have all of the rights, powers, and privileges under its constituent documents and applicable Federal or State law. In connection therewith, the Corporation may take such steps as may be necessary or convenient to reincorporate the bridge financial company under the laws of a State and, notwithstanding any provisions of Federal or State law, the State-chartered corporation shall be deemed to succeed by operation of law to such rights, titles, powers and interests of the bridge financial company as the Corporation may provide, with the same effect as if the bridge financial company had merged with the State-chartered corporation under provisions of the corporate laws of such State. (D) Assumption of liabilities and sale of assets.-- Following the assumption of all or substantially all of the liabilities of the bridge
financial company, or the sale of

all or substantially all of the assets of the bridge financial company, as provided in paragraph (13)(D), at the election of the Corporation, the bridge financial company may retain its status as such for the period provided in paragraph (12) or may be dissolved at the election of the Corporation. (E) Amendments to charter.--Following the consummation of a transaction described in subparagraph (A), (B), (C), or (D) of paragraph (13), the charter of the resulting company shall be amended to reflect the termination of bridge financial company status, if appropriate. (15) Dissolution of bridge financial company.-- (A) In general.--Notwithstanding any other provision of Federal or State law, if the status of a bridge financial company as such has not previously been terminated by the occurrence of an event specified in subparagraph (A), (B), (C), or (D) of paragraph (13)-- (i) the Corporation may, in its discretion, dissolve the bridge financial company in accordance with this paragraph at any time; and (ii) the Corporation shall promptly commence dissolution proceedings in accordance with this paragraph upon the expiration of the 2-year period following the date on which the bridge financial company was chartered, or any extension thereof, as provided in paragraph (12). (B) Procedures.--The Corporation shall remain the receiver for a bridge financial company for the purpose of dissolving the bridge financial company. The Corporation as receiver for a bridge financial company shall wind up the affairs of the bridge financial company in conformity with the provisions of law relating to the liquidation of covered financial companies under this title. With respect to any such bridge financial company, the Corporation as receiver shall have all the rights, powers, and privileges and shall perform the duties related to the exercise of such rights, powers, or privileges granted by law to the Corporation as receiver for a covered financial company under this title and, notwithstanding any other provision of law, in the exercise of such rights, powers, and privileges, the Corporation shall not be subject to the direction or supervision of any State agency or other Federal agency. (16) Authority to obtain credit.-- (A) In general.--A bridge financial company may obtain unsecured credit and issue unsecured debt. (B) Inability to obtain credit.--If a bridge financial company is unable to obtain unsecured credit or issue unsecured debt, the Corporation may authorize the obtaining of credit or the issuance of debt by the bridge financial company-- (i) with priority over any or all of the obligations of the bridge financial company; (ii) secured by a lien on property of the bridge financial company that is not otherwise subject to a lien; or (iii) secured by a junior lien on property of the bridge financial company that is subject to a lien. (C) Limitations.--

(i) In general.--The Corporation, after notice and a hearing, may authorize the obtaining of credit or the issuance of debt by a bridge financial company that is secured by a senior or equal lien on property of the bridge financial company that is subject to a lien, only if-- (I) the bridge financial company is unable to otherwise obtain such credit or issue such debt; and (II) there is adequate protection of the interest of the holder of the lien on the property with respect to which such senior or equal lien is proposed to be granted. (ii) Hearing.--The hearing required pursuant to this subparagraph shall be before a court of the United States, which shall have jurisdiction to conduct such hearing and to authorize a bridge financial company to obtain secured credit under clause (i). (D) Burden of proof.--In any hearing under this paragraph, the Corporation has the burden of proof on the issue of adequate protection. (E) Qualified financial contracts.--No credit or debt obtained or issued by a bridge financial company may contain terms that impair the rights of a counterparty to a qualified financial contract upon a default by the bridge financial company, other than the priority of such counterparty's unsecured claim (after the exercise of rights) relative to the priority of the bridge financial company's obligations in respect of such credit or debt, unless such counterparty consents in writing to any such impairment. (17) Effect on debts and liens.--The reversal or modification on appeal of an authorization under this subsection to obtain credit or issue debt, or of a grant under this section of a priority or a lien, does not affect the validity of any debt so issued, or any priority or lien so granted, to an entity that extended such credit in good faith, whether or not such entity knew of the pendency of the appeal, unless such authorization and the issuance of such debt, or the granting of such priority or lien, were stayed pending appeal.

(i) Sharing Records.--If the Corporation has been appointed as receiver for a covered financial company, other Federal regulators shall make all records relating to the covered financial company available to the Corporation, which may be used by the Corporation in any manner that the Corporation determines to be appropriate. (j) Expedited Procedures for Certain Claims.-- (1) Time for filing notice of appeal.-- The notice of appeal of any order, whether interlocutory or final, entered in any case brought by the Corporation against a director, officer, employee, agent, attorney, accountant, or appraiser of the covered financial company, or any other person employed by or providing services to a covered financial company, shall be filed not later than 30 days after the date of entry of the order. The hearing of the appeal shall be held not later than 120 days after the date of the notice of appeal. The appeal shall be decided not later than 180 days after the date of the notice of appeal.

(2) Scheduling.--The court shall expedite the consideration of any case brought by the Corporation against a director, officer, employee, agent, attorney, accountant, or appraiser of a covered financial company or any other person employed by or providing services to a covered financial company. As far as practicable, the court shall give such case priority on its docket. (3) Judicial discretion.--The court may modify the schedule and limitations stated in paragraphs (1) and (2) in a particular case, based on a specific finding that the ends of justice that would be served by making such a modification would outweigh the best interest of the public in having the case resolved expeditiously.

(k) Foreign Investigations.--The Corporation, as receiver for any covered financial company, and for purposes of carrying out any power, authority, or duty with respect to a covered financial company-- (1) may request the assistance of any foreign financial authority and provide assistance to any foreign financial authority in accordance with section 8(v) of the Federal Deposit Insurance Act, as if the covered financial company were an insured depository institution, the Corporation were the appropriate Federal banking agency for the company, and any foreign financial authority were the foreign banking authority; and (2) may maintain an office to coordinate foreign investigations or investigations on behalf of foreign financial authorities.

(l) Prohibition on Entering Secrecy Agreements and Protective Orders.--The Corporation may not enter into any agreement or approve any protective order which prohibits the Corporation from disclosing the terms of any settlement of an administrative or other action for damages or restitution brought by the Corporation in its capacity as receiver for a covered financial company. (m) Liquidation of Certain Covered Financial Companies or Bridge Financial Companies.-- (1) In general.--Except as specifically provided in this section, and notwithstanding any other provision of law, the Corporation, in connection with the liquidation of any covered financial company or bridge financial company with respect to which the Corporation has been appointed as receiver, shall-- (A) in the case of any covered financial company or bridge financial company that is a stockbroker, but is not a member of the Securities Investor Protection Corporation, apply the provisions of subchapter III of
chapter 7 of the Bankruptcy Code, in respect of the
distribution to any customer of all customer name security and customer property and member property, as if such covered financial company or bridge financial company were a debtor for purposes of such subchapter; or (B) in the case of any covered financial company or bridge financial company that is a commodity broker, apply the provisions of subchapter IV of chapter 7 the Bankruptcy Code, in respect of the distribution to any customer of all customer property and member property, as if such covered financial company or bridge financial company were a debtor for purposes of such subchapter. (2) Definitions.--For purposes of this subsection--

(A) the terms “customer”, “customer name security”, and “customer property and member property” have the same meanings as in sections 741 and 761 of title 11, United States Code; and (B) the terms “commodity broker” and “stockbroker” have the same meanings as in section 101 of the Bankruptcy Code.

(n) Orderly Liquidation Fund.--
(1) Establishment.--There is established in the Treasury of the United States a separate fund to be known as the “Orderly Liquidation Fund”, which shall be available to the Corporation to carry out the authorities contained in this title, for the cost of actions authorized by this title, including the orderly liquidation of covered financial companies, payment of administrative expenses, the payment of principal and interest by the Corporation on obligations issued under paragraph (5), and the exercise of the authorities of the Corporation under this title. (2) Proceeds.--Amounts received by the Corporation, including assessments received under subsection (o), proceeds of obligations issued under paragraph (5), interest and other earnings from investments, and repayments to the Corporation by covered financial companies, shall be deposited into the Fund. (3) Management.--The Corporation shall manage the Fund in accordance with this subsection and the policies and procedures established under section 203(d). (4) Investments.--At the request of the Corporation, the Secretary may invest such portion of amounts held in the Fund that are not, in the judgment of the Corporation, required to meet the current needs of the Corporation, in obligations of the United States having suitable maturities, as determined by the Corporation. The interest on and the proceeds from the sale or redemption of such obligations shall be credited to the Fund. (5) Authority to issue obligations.-- (A) Corporation authorized to issue obligations.-- Upon appointment by the Secretary of the Corporation as receiver for a covered financial company, the Corporation is authorized to issue obligations to the Secretary. (B) Secretary authorized to purchase obligations.-- The Secretary may, under such terms and conditions as the Secretary may require, purchase or agree to purchase any obligations issued under subparagraph (A), and for such purpose, the Secretary is authorized to use as a public debt transaction the proceeds of the sale of any securities issued under chapter 31 of title 31, United States Code, and the purposes for which securities may be issued under chapter 31 of title 31, United States Code, are extended to include such purchases. (C) Interest rate.--Each purchase of obligations by the Secretary under this paragraph shall be upon such terms and conditions as to yield a return at a rate determined by the Secretary, taking into consideration the current average yield on outstanding marketable obligations of the United States of comparable maturity, plus an

interest rate surcharge to be determined by the Secretary, which shall be greater than the difference between-- (i) the current average rate on an index of corporate obligations of comparable maturity; and (ii) the current average rate on outstanding marketable obligations of the United States of comparable maturity. (D) Secretary authorized to sell obligations.--The Secretary may sell, upon such terms and conditions as the Secretary shall determine, any of the obligations acquired under this paragraph. (E) Public debt transactions.--All purchases and sales by the Secretary of such obligations under this paragraph shall be treated as public debt transactions of the United States, and the proceeds from the sale of any obligations acquired by the Secretary under this paragraph shall be deposited into the Treasury of the United States as miscellaneous receipts. (6) Maximum obligation limitation.--The Corporation may not, in connection with the orderly liquidation of a covered financial company, issue or incur any obligation, if, after issuing or incurring the obligation, the aggregate amount of such obligations outstanding under this subsection for each covered financial company would exceed-- (A) an amount that is equal to 10 percent of the total consolidated assets of the covered financial company, based on the most recent financial statement available, during the 30-day period immediately following the date of appointment of the Corporation as receiver (or a shorter time period if the Corporation has calculated the amount described under subparagraph (B)); and (B) the amount that is equal to 90 percent of the fair value of the total consolidated assets of each covered financial company that are available for repayment, after the time period described in subparagraph (A). (7) Rulemaking.--The Corporation and the Secretary shall jointly, in consultation with the Council, prescribe regulations governing the calculation of the maximum obligation limitation defined in this paragraph. (8) Rule of construction.-- (A) In general.--Nothing in this section shall be construed to affect the authority of the Corporation under subsection (a) or (b) of section 14 or section 15(c)(5) of the Federal Deposit Insurance Act (12 U.S.C. 1824, 1825(c)(5)), the management of the Deposit Insurance Fund by the Corporation, or the resolution of insured depository institutions, provided that-- (i) the authorities of the Corporation contained in this title shall not be used to assist the Deposit Insurance Fund or to assist any financial company under applicable law other than this Act; (ii) the authorities of the Corporation relating to the Deposit Insurance Fund, or any other responsibilities of the Corporation under applicable law other than this title, shall not be used to assist a covered financial company pursuant to this title; and

(iii) the Deposit Insurance Fund may not be used in any manner to otherwise circumvent the purposes of this title. (B) Valuation.--For purposes of determining the amount of obligations under this subsection-- (i) the Corporation shall include as an obligation any contingent liability of the Corporation pursuant to this title; and (ii) the Corporation shall value any contingent liability at its expected cost to the Corporation. (9) Orderly liquidation and repayment plans.-- (A) Orderly liquidation plan.--Amounts in the Fund shall be available to the Corporation with regard to a covered financial company for which the Corporation is appointed receiver after the Corporation has developed an orderly liquidation plan that is acceptable to the Secretary with regard to such covered financial company, including the provision and use of funds, including taking any actions specified under section 204(d) and subsection (h)(2)(G)(iv) and (h)(9) of this section, and payments to third parties. The orderly liquidation plan shall take into account actions to avoid or mitigate potential adverse effects on low income, minority, or underserved communities affected by the failure of the covered financial company, and shall provide for coordination with the primary financial regulatory agencies, as appropriate, to ensure that such actions are taken. The Corporation may, at any time, amend any orderly liquidation plan approved by the Secretary with the concurrence of the Secretary. (B) Mandatory repayment plan.-- (i) In general.-- No amount authorized under paragraph (6)(B) may be provided by the Secretary to the Corporation under paragraph (5), unless an agreement is in effect between the Secretary and the Corporation that-- (I) provides a specific plan and
schedule to achieve the repayment of the
outstanding amount of any borrowing under paragraph (5); and (II) demonstrates that income to the Corporation from the liquidated assets of the covered financial company and assessments under subsection (o) will be sufficient to amortize the outstanding balance within the period established in the repayment schedule and pay the interest accruing on such balance within the time provided in subsection (o)(1)(B). (ii) Consultation with and report to congress.--The Secretary and the Corporation shall-- (I) consult with the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives on the terms of any repayment schedule agreement; and (II) submit a copy of the repayment
schedule agreement to the Committees
described in subclause (I) before the end of the 30-day period beginning on the date on which any amount is provided

by the Secretary to the Corporation under paragraph (5). (10) Implementation expenses.-- (A) In general.--Reasonable implementation expenses of the Corporation incurred after the date of enactment of this Act shall be treated as expenses of the Council. (B) Requests for reimbursement.--The Corporation shall periodically submit a request for reimbursement for implementation expenses to the Chairperson of the Council, who shall arrange for prompt reimbursement to the Corporation of reasonable implementation expenses. (C) Definition.--As used in this paragraph, the term “implementation expenses”-- (i) means costs incurred by the Corporation beginning on the date of enactment of this Act, as
part of its efforts to implement this title that
do not relate to a particular covered financial company; and (ii) includes the costs incurred in connection with the development of policies, procedures, rules, and regulations and other planning activities of the Corporation consistent with carrying out this title.

(o) Assessments.--
(1) Risk-based assessments.--
(A) Eligible financial companies defined.--For purposes of this subsection, the term “eligible financial company” means any bank holding company with total consolidated assets equal to or greater than $50,000,000,000 and any nonbank financial company supervised by the Board of Governors. (B) Assessments.-- The Corporation shall charge one or more risk-based assessments in accordance with the provisions of subparagraph (D), if such assessments are necessary to pay in full the obligations issued by the Corporation to the Secretary under this title within 60 months of the date of issuance of such obligations. (C) Extensions authorized.--The Corporation may, with the approval of the Secretary, extend the time period under subparagraph (B), if the Corporation determines that an extension is necessary to avoid a serious adverse effect on the financial system of the United States. (D) Application of assessments.--To meet the requirements of subparagraph (B), the Corporation shall-- (i) impose assessments, as soon as practicable, on any claimant that received additional payments or amounts from the Corporation pursuant to subsection (b)(4), (d)(4), or (h)(5)(E), except for payments or amounts necessary to initiate and continue operations essential to implementation of the receivership or any bridge financial company, to recover on a cumulative basis, the entire difference between-- (I) the aggregate value the claimant received from the Corporation on a claim pursuant to this title (including pursuant to subsection (b)(4), (d)(4), and (h)(5)(E)), as of the date on which such value was received; and (II) the value the claimant was entitled to receive from the Corporation on such claim solely

from the proceeds of the liquidation of the covered financial company under this title; and (ii) if the amounts to be recovered on a cumulative basis under clause (i) are insufficient to meet the requirements of subparagraph (B), after taking into account the considerations set forth in paragraph (4), impose assessments on-- (I) eligible financial companies; and (II) financial companies with total consolidated assets equal to or greater than $50,000,000,000 that are not eligible financial companies. (E) Provision of financing.--Payments or amounts necessary to initiate and continue operations essential to implementation of the receivership or any bridge financial company described in subparagraph (D)(i) shall not include the provision of financing, as defined by rule of the Corporation, to third parties. (2) Graduated assessment rate.--The Corporation shall impose assessments on a graduated basis, with financial companies having greater assets and risk being assessed at a higher rate. (3) Notification and payment.--The Corporation shall notify each financial company of that company's assessment under this subsection. Any financial company subject to assessment under this subsection shall pay such assessment in accordance with the regulations prescribed pursuant to paragraph (6). (4) Risk-based assessment considerations.-- In imposing assessments under paragraph (1)(D)(ii), the Corporation shall use a risk matrix. The Council shall make a recommendation to the Corporation on the risk matrix to be used in imposing such assessments, and the Corporation shall take into account any such recommendation in the establishment of the risk matrix to be used to impose such assessments. In recommending or establishing such risk matrix, the Council and the Corporation, respectively, shall take into account-- (A) economic conditions generally affecting financial companies so as to allow assessments to increase during more favorable economic conditions and to decrease during less favorable economic conditions; (B) any assessments imposed on a financial company or an affiliate of a financial company that-- (i) is an insured depository institution, assessed pursuant to section 7 or 13(c)(4)(G) of the Federal Deposit Insurance Act; (ii) is a member of the Securities Investor Protection Corporation, assessed pursuant to
section 4 of the Securities Investor Protection
Act of 1970 (15 U.S.C. 78ddd);
(iii) is an insured credit union, assessed pursuant to section 202(c)(1)(A)(i) of the Federal Credit Union Act (12 U.S.C. 1782(c)(1)(A)(i)); or (iv) is an insurance company, assessed pursuant to applicable State law to cover (or reimburse payments made to cover) the costs of the rehabilitation, liquidation, or other State insolvency proceeding with respect to 1 or more insurance companies;

(C) the risks presented by the financial company to the financial system and the extent to which the financial company has benefitted, or likely would benefit, from the orderly liquidation of a financial company under this title, including-- (i) the amount, different categories, and concentrations of assets of the financial company and its affiliates, including both on-balance sheet and off-balance sheet assets; (ii) the activities of the financial company and its affiliates; (iii) the relevant market share of the financial company and its affiliates; (iv) the extent to which the financial company is leveraged; (v) the potential exposure to sudden calls on liquidity precipitated by economic distress; (vi) the amount, maturity, volatility, and stability of the company's financial obligations to, and relationship with, other financial companies; (vii) the amount, maturity, volatility, and stability of the liabilities of the company, including the degree of reliance on short-term funding, taking into consideration existing systems for measuring a company's risk-based capital; (viii) the stability and variety of the company's sources of funding; (ix) the company's importance as a source of credit for households, businesses, and State and local governments and as a source of liquidity for the financial system; (x) the extent to which assets are simply managed and not owned by the financial company and the extent to which ownership of assets under management is diffuse; and (xi) the amount, different categories, and concentrations of liabilities, both insured and uninsured, contingent and noncontingent, including both on-balance sheet and off-balance sheet liabilities, of the financial company and its affiliates; (D) any risks presented by the financial company during the 10-year period immediately prior to the appointment of the Corporation as receiver for the covered financial company that contributed to the failure of the covered financial company; and (E) such other risk-related factors as the Corporation, or the Council, as applicable, may determine to be appropriate. (5) Collection of information.--The Corporation may impose on covered financial companies such collection of information requirements as the Corporation deems necessary to carry out this subsection after the appointment of the Corporation as receiver under this title. (6) Rulemaking.-- (A) In general.-- The Corporation shall prescribe regulations to carry out this subsection. The Corporation shall

consult with the Secretary in the development and finalization of such regulations. (B) Equitable treatment.--The regulations prescribed under subparagraph (A) shall take into account the differences in risks posed to the financial stability of the United States by financial companies, the differences in the liability structures of financial companies, and the different bases for other assessments that such financial companies may be required to pay, to ensure that assessed financial companies are treated equitably and that assessments under this subsection reflect such differences.

(p) Unenforceability of Certain Agreements.-- (1) In general.--No provision described in paragraph (2) shall be enforceable against or impose any liability on any person, as such enforcement or liability shall be contrary to public policy. (2) Prohibited provisions.--A provision described in this paragraph is any term contained in any existing or future standstill, confidentiality, or other agreement that, directly or indirectly-- (A) affects, restricts, or limits the ability of any person to offer to acquire or acquire; (B) prohibits any person from offering to acquire or acquiring; or (C) prohibits any person from using any previously disclosed information in connection with any such offer to acquire or acquisition of, all or part of any covered financial company, including any liabilities, assets, or interest therein, in connection with any transaction in which the Corporation exercises its authority under this title.

(q) Other Exemptions.--
(1) In general.--When acting as a receiver under this title-- (A) the Corporation, including its franchise, its capital, reserves and surplus, and its income, shall be exempt from all taxation imposed by any State, county, municipality, or local taxing authority, except that any real property of the Corporation shall be subject to State, territorial, county, municipal, or local taxation to the same extent according to its value as other real property is taxed, except that, notwithstanding the failure of any person to challenge an assessment under State law of the value of such property, such value, and the tax thereon, shall be determined as of the period for which such tax is imposed; (B) no property of the Corporation shall be subject to levy, attachment, garnishment, foreclosure, or sale without the consent of the Corporation, nor shall any involuntary lien attach to the property of the Corporation; and (C) the Corporation shall not be liable for any amounts in the nature of penalties or fines, including those arising from the failure of any person to pay any real property, personal property, probate, or recording tax or any recording or filing fees when due; and (D) the Corporation shall be exempt from all prosecution by the United States or any State, county, municipality, or local authority for any criminal offense arising

under Federal, State, county, municipal, or local law, which was allegedly committed by the covered financial company, or persons acting on behalf of the covered financial company, prior to the appointment of the Corporation as receiver. (2) Limitation.--Paragraph (1) shall not apply with respect to any tax imposed (or other amount arising) under the Internal Revenue Code of 1986.

(r) Certain Sales of Assets Prohibited.-- (1) Persons who engaged in improper conduct with, or caused losses to, covered financial companies.-- The Corporation shall prescribe regulations which, at a minimum, shall prohibit the sale of assets of a covered financial company by the Corporation to-- (A) any person who-- (i) has defaulted, or was a member of a partnership or an officer or director of a corporation that has defaulted, on 1 or more obligations, the aggregate amount of which exceeds $1,000,000, to such covered financial company; (ii) has been found to have engaged in fraudulent activity in connection with any obligation referred to in clause (i); and (iii) proposes to purchase any such asset in whole or in part through the use of the proceeds of a loan or advance of credit from the Corporation or from any covered financial company; (B) any person who participated, as an officer or director of such covered financial company or of any affiliate of such company, in a material way in any transaction that resulted in a substantial loss to such covered financial company; or (C) any person who has demonstrated a pattern or practice of defalcation regarding obligations to such covered financial company. (2) Convicted debtors.--Except as provided in paragraph (3), a person may not purchase any asset of such institution from the receiver, if that person-- (A) has been convicted of an offense under section 215, 656, 657, 1005, 1006, 1007, 1008, 1014, 1032, 1341, 1343, or 1344 of title 18, United States Code, or of conspiring to commit such an offense, affecting any covered financial company; and (B) is in default on any loan or other extension of credit from such covered financial company which, if not paid, will cause substantial loss to the Fund or the Corporation. (3) Settlement of claims.--Paragraphs (1) and (2) shall not apply to the sale or transfer by the Corporation of any asset of any covered financial company to any person, if the sale or transfer of the asset resolves or settles, or is part of the resolution or settlement, of 1 or more claims that have been, or could have been, asserted by the Corporation against the person. (4) Definition of default.--For purposes of this subsection, the term “default” means a failure to comply with

the terms of a loan or other obligation to such an extent that the property securing the obligation is foreclosed upon.

(s) Recoupment of Compensation From Senior Executives and Directors.-- (1) In general.--The Corporation, as receiver of a covered financial company, may recover from any current or former senior executive or director substantially responsible for the failed condition of the covered financial company any compensation received during the 2-year period preceding the date on which the Corporation was appointed as the receiver of the covered financial company, except that, in the case of fraud, no time limit shall apply. (2) Cost considerations.--In seeking to recover any such compensation, the Corporation shall weigh the financial and deterrent benefits of such recovery against the cost of executing the recovery. (3) Rulemaking.--The Corporation shall promulgate regulations to implement the requirements of this subsection, including defining the term “compensation” to mean any financial remuneration, including salary, bonuses, incentives, benefits, severance, deferred compensation, or golden parachute benefits, and any profits realized from the sale of the securities of the covered financial company. SEC. 211. MISCELLANEOUS PROVISIONS.

(a) Clarification of Prohibition Regarding Concealment of Assets From Receiver or Liquidating Agent.--Section 1032(1) of title 18, United States Code, is amended by inserting “the Federal Deposit Insurance Corporation acting as receiver for a covered financial company, in accordance with title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act,” before “or the National Credit”. (b) Conforming Amendment.--Section 1032 of title 18, United States Code, is amended in the section heading, by striking “of financial institution”. (c) Federal Deposit Insurance Corporation Improvement Act of 1991.--
Section 403(a) of the Federal Deposit Insurance Corporation Improvement
Act of 1991 (12 U.S.C. 4403(a)) is amended by inserting “section 210(c) of the Dodd-Frank Wall Street Reform and Consumer Protection Act,
section 1367 of the Federal Housing Enterprises Financial Safety and
Soundness Act of 1992 (12 U.S.C. 4617(d)),” after “section 11(e) of the Federal Deposit Insurance Act,”. (d) FDIC Inspector General Reviews.-- (1) Scope.--The Inspector General of the Corporation shall conduct, supervise, and coordinate audits and investigations of the liquidation of any covered financial company by the Corporation as receiver under this title, including collecting and summarizing-- (A) a description of actions taken by the Corporation as receiver; (B) a description of any material sales, transfers, mergers, obligations, purchases, and other material transactions entered into by the Corporation; (C) an evaluation of the adequacy of the policies and procedures of the Corporation under section 203(d) and orderly liquidation plan under section 210(n)(14);

(D) an evaluation of the utilization by the Corporation of the private sector in carrying out its functions, including the adequacy of any conflict-of- interest reviews; and (E) an evaluation of the overall performance of the Corporation in liquidating the covered financial company, including administrative costs, timeliness of liquidation process, and impact on the financial system. (2) Frequency.--Not later than 6 months after the date of appointment of the Corporation as receiver under this title and every 6 months thereafter, the Inspector General of the Corporation shall conduct the audit and investigation described in paragraph (1). (3) Reports and testimony.--The Inspector General of the Corporation shall include in the semiannual reports required by
section 5(a) of the Inspector General Act of 1978 (5 U.S.C.
App.), a summary of the findings and evaluations under paragraph (1), and shall appear before the appropriate committees of Congress, if requested, to present each such report. (4) Funding.-- (A) Initial funding.--The expenses of the Inspector General of the Corporation in carrying out this subsection shall be considered administrative expenses of the receivership. (B) Additional funding.--If the maximum amount available to the Corporation as receiver under this title is insufficient to enable the Inspector General of the Corporation to carry out the duties under this subsection, the Corporation shall pay such additional amounts from assessments imposed under section 210. (5) Termination of responsibilities.--The duties and responsibilities of the Inspector General of the Corporation under this subsection shall terminate 1 year after the date of termination of the receivership under this title.

(e) Treasury Inspector General Reviews.-- (1) Scope.--The Inspector General of the Department of the Treasury shall conduct, supervise, and coordinate audits and investigations of actions taken by the Secretary related to the liquidation of any covered financial company under this title, including collecting and summarizing-- (A) a description of actions taken by the Secretary under this title; (B) an analysis of the approval by the Secretary of the policies and procedures of the Corporation under
section 203 and acceptance of the orderly liquidation
plan of the Corporation under section 210; and (C) an assessment of the terms and conditions underlying the purchase by the Secretary of obligations of the Corporation under section 210. (2) Frequency.--Not later than 6 months after the date of appointment of the Corporation as receiver under this title and every 6 months thereafter, the Inspector General of the Department of the Treasury shall conduct the audit and investigation described in paragraph (1). (3) Reports and testimony.--The Inspector General of the Department of the Treasury shall include in the semiannual reports required by section 5(a) of the Inspector General Act

of 1978 (5 U.S.C. App.), a summary of the findings and assessments under paragraph (1), and shall appear before the appropriate committees of Congress, if requested, to present each such report. (4) Termination of responsibilities.--The duties and responsibilities of the Inspector General of the Department of the Treasury under this subsection shall terminate 1 year after the date on which the obligations purchased by the Secretary from the Corporation under section 210 are fully redeemed.

(f) Primary Financial Regulatory Agency Inspector General Reviews.-- (1) Scope.--Upon the appointment of the Corporation as receiver for a covered financial company supervised by a Federal primary financial regulatory agency or the Board of Governors under section 165, the Inspector General of the agency or the Board of Governors shall make a written report reviewing the supervision by the agency or the Board of Governors of the covered financial company, which shall-- (A) evaluate the effectiveness of the agency or the Board of Governors in carrying out its supervisory responsibilities with respect to the covered financial company; (B) identify any acts or omissions on the part of agency or Board of Governors officials that contributed to the covered financial company being in default or in danger of default; (C) identify any actions that could have been taken by the agency or the Board of Governors that would have prevented the company from being in default or in danger of default; and (D) recommend appropriate administrative or legislative action. (2) Reports and testimony.--Not later than 1 year after the date of appointment of the Corporation as receiver under this title, the Inspector General of the Federal primary financial regulatory agency or the Board of Governors shall provide the report required by paragraph (1) to such agency or the Board of Governors, and along with such agency or the Board of Governors, as applicable, shall appear before the appropriate committees of Congress, if requested, to present the report required by paragraph (1). Not later than 90 days after the date of receipt of the report required by paragraph (1), such agency or the Board of Governors, as applicable, shall provide a written report to Congress describing any actions taken in response to the recommendations in the report, and if no such actions were taken, describing the reasons why no actions were taken. SEC. 212. PROHIBITION OF CIRCUMVENTION AND PREVENTION OF CONFLICTS OF INTEREST.

(a) No Other Funding.--Funds for the orderly liquidation of any covered financial company under this title shall only be provided as specified under this title. (b) Limit on Governmental Actions.--No governmental entity may take any action to circumvent the purposes of this title.

(c) Conflict of Interest.--In the event that the Corporation is appointed receiver for more than 1 covered financial company or is appointed receiver for a covered financial company and receiver for any insured depository institution that is an affiliate of such covered financial company, the Corporation shall take appropriate action, as necessary to avoid any conflicts of interest that may arise in connection with multiple receiverships. SEC. 213. BAN ON CERTAIN ACTIVITIES BY SENIOR EXECUTIVES AND DIRECTORS.

(a) Prohibition Authority.--The Board of Governors or, if the covered financial company was not supervised by the Board of Governors, the Corporation, may exercise the authority provided by this section. (b) Authority To Issue Order.--The appropriate agency described in subsection (a) may take any action authorized by subsection (c), if the agency determines that-- (1) a senior executive or a director of the covered financial company, prior to the appointment of the Corporation as receiver, has, directly or indirectly-- (A) violated-- (i) any law or regulation; (ii) any cease-and-desist order which has become final; (iii) any condition imposed in writing by a Federal agency in connection with any action on any application, notice, or request by such company or senior executive; or (iv) any written agreement between such company and such agency; (B) engaged or participated in any unsafe or unsound practice in connection with any financial company; or (C) committed or engaged in any act, omission, or practice which constitutes a breach of the fiduciary duty of such senior executive or director; (2) by reason of the violation, practice, or breach described in any subparagraph of paragraph (1), such senior executive or director has received financial gain or other benefit by reason of such violation, practice, or breach and such violation, practice, or breach contributed to the failure of the company; and (3) such violation, practice, or breach-- (A) involves personal dishonesty on the part of such senior executive or director; or (B) demonstrates willful or continuing disregard by such senior executive or director for the safety or soundness of such company.

(c) Authorized Actions.--
(1) In general.--The appropriate agency for a financial company, as described in subsection (a), may serve upon a senior executive or director described in subsection (b) a written notice of the intention of the agency to prohibit any further participation by such person, in any manner, in the conduct of the affairs of any financial company for a period of time determined by the appropriate agency to be commensurate with such violation, practice, or breach, provided such period shall be not less than 2 years.

(2) Procedures.--The due process requirements and other procedures under section 8(e) of the Federal Deposit Insurance Act (12 U.S.C. 1818(e)) shall apply to actions under this section as if the covered financial company were an insured depository institution and the senior executive or director were an institution-affiliated party, as those terms are defined in that Act.

(d) Regulations.--The Corporation and the Board of Governors, in consultation with the Council, shall jointly prescribe rules or regulations to administer and carry out this section, including rules, regulations, or guidelines to further define the term senior executive for the purposes of this section. SEC. 214. PROHIBITION ON TAXPAYER FUNDING.

(a) Liquidation Required.--All financial companies put into receivership under this title shall be liquidated. No taxpayer funds shall be used to prevent the liquidation of any financial company under this title. (b) Recovery of Funds.--All funds expended in the liquidation of a financial company under this title shall be recovered from the disposition of assets of such financial company, or shall be the responsibility of the financial sector, through assessments. (c) No Losses to Taxpayers.--Taxpayers shall bear no losses from the exercise of any authority under this title. SEC. 215. STUDY ON SECURED CREDITOR HAIRCUTS.

(a) Study Required.--The Council shall conduct a study evaluating the importance of maximizing United States taxpayer protections and promoting market discipline with respect to the treatment of fully secured creditors in the utilization of the orderly liquidation authority authorized by this Act. In carrying out such study, the Council shall-- (1) not be prejudicial to current or past laws or regulations with respect to secured creditor treatment in a resolution process; (2) study the similarities and differences between the resolution mechanisms authorized by the Bankruptcy Code, the Federal Deposit Insurance Corporation Improvement Act of 1991, and the orderly liquidation authority authorized by this Act; (3) determine how various secured creditors are treated in such resolution mechanisms and examine how a haircut (of various degrees) on secured creditors could improve market discipline and protect taxpayers; (4) compare the benefits and dynamics of prudent lending practices by depository institutions in secured loans for consumers and small businesses to the lending practices of secured creditors to large, interconnected financial firms; (5) consider whether credit differs according to different types of collateral and different terms and timing of the extension of credit; amd (6) include an examination of stakeholders who were unsecured or under-collateralized and seek collateral when a firm is failing, and the impact that such behavior has on financial stability and an orderly resolution that protects taxpayers if the firm fails.

(b) Report.--Not later than the end of the 1-year period beginning on the date of enactment of this Act, the Council shall issue a report to the Congress containing all findings and conclusions

made by the Council in carrying out the study required under subsection (a). SEC. 216. STUDY ON BANKRUPTCY PROCESS FOR FINANCIAL AND NONBANK FINANCIAL INSTITUTIONS.

(a) Study.--
(1) In general.--Upon enactment of this Act, the Board of Governors, in consultation with the Administrative Office of the United States Courts, shall conduct a study regarding the resolution of financial companies under the Bankruptcy Code, under chapter 7 or 11 thereof . (2) Issues to be studied.--Issues to be studied under this
section include--
(A) the effectiveness of chapter 7 and chapter 11 of the Bankruptcy Code in facilitating the orderly resolution or reorganization of systemic financial companies; (B) whether a special financial resolution court or panel of special masters or judges should be established to oversee cases involving financial companies to provide for the resolution of such companies under the Bankruptcy Code, in a manner that minimizes adverse impacts on financial markets without creating moral hazard; (C) whether amendments to the Bankruptcy Code should be adopted to enhance the ability of the Code to resolve financial companies in a manner that minimizes adverse impacts on financial markets without creating moral hazard; (D) whether amendments should be made to the Bankruptcy Code, the Federal Deposit Insurance Act, and other insolvency laws to address the manner in which qualified financial contracts of financial companies are treated; and (E) the implications, challenges, and benefits to creating a new chapter or subchapter of the Bankruptcy Code to deal with financial companies.

(b) Reports to Congress.--Not later than 1 year after the date of enactment of this Act, and in each successive year until the fifth year after the date of enactment of this Act, the Administrative Office of the United States courts shall submit to the Committees on Banking, Housing, and Urban Affairs and the Judiciary of the Senate and the Committees on Financial Services and the Judiciary of the House of Representatives a report summarizing the results of the study conducted under subsection (a). SEC. 217. STUDY ON INTERNATIONAL COORDINATION RELATING TO BANKRUPTCY PROCESS FOR NONBANK FINANCIAL INSTITUTIONS.

(a) Study.--
(1) In general.--The Board of Governors, in consultation with the Administrative Office of the United States Courts, shall conduct a study regarding international coordination relating to the resolution of systemic financial companies under the United States Bankruptcy Code and applicable foreign law. (2) Issues to be studied.--With respect to the bankruptcy process for financial companies, issues to be studied under this
section include--
(A) the extent to which international coordination currently exists;

(B) current mechanisms and structures for facilitating international cooperation; (C) barriers to effective international coordination; and (D) ways to increase and make more effective international coordination of the resolution of financial companies, so as to minimize the impact on the financial system without creating moral hazard.

(b) Report to Congress.--Not later than 1 year after the date of enactment of this Act, the Administrative office of the United States Courts shall submit to the Committees on Banking, Housing, and Urban Affairs and the Judiciary of the Senate and the Committees on Financial Services and the Judiciary of the House of Representatives a report summarizing the results of the study conducted under subsection (a).

TITLE III--TRANSFER OF POWERS TO THE COMPTROLLER OF THE CURRENCY, THE CORPORATION, AND THE BOARD OF GOVERNORS SEC. 300. SHORT TITLE.

This title may be cited as the “Enhancing Financial Institution Safety and Soundness Act of 2010”. SEC. 301. PURPOSES.

The purposes of this title are--
(1) to provide for the safe and sound operation of the banking system of the United States; (2) to preserve and protect the dual system of Federal and State-chartered depository institutions; (3) to ensure the fair and appropriate supervision of each depository institution, regardless of the size or type of charter of the depository institution; and (4) to streamline and rationalize the supervision of depository institutions and the holding companies of depository institutions. SEC. 302. DEFINITION.

In this title, the term “transferred employee” means, as the context requires, an employee transferred to the Office of the Comptroller of the Currency or the Corporation under section 322.

Subtitle A--Transfer of Powers and Duties

SEC. 311. TRANSFER DATE.

(a) Transfer Date.--Except as provided in subsection (b), the term “transfer date” means the date that is 1 year after the date of enactment of this Act.

(b) Extension Permitted.--
(1) Notice required.--The Secretary, in consultation with the Comptroller of the Currency, the Director of the Office of Thrift Supervision, the Chairman of the Board of Governors, and the Chairperson of the Corporation, may extend the period under subsection (a) and designate a transfer date that is

not later than 18 months after the date of enactment of this Act, if the Secretary transmits to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives-- (A) a written determination that commencement of the orderly process to implement this title is not feasible by the date that is 1 year after the date of enactment of this Act; (B) an explanation of why an extension is necessary to commence the process of orderly implementation of this title; (C) the transfer date designated under this subsection; and (D) a description of the steps that will be taken to initiate the process of an orderly and timely implementation of this title within the extended time period. (2) Publication of notice.--Not later than 270 days after the date of enactment of this Act, the Secretary shall publish in the Federal Register notice of any transfer date designated under paragraph (1). SEC. 312. POWERS AND DUTIES TRANSFERRED.

(a) Effective Date.--This section, and the amendments made by this
section, shall take effect on the transfer date.
(b) Functions of the Office of Thrift Supervision.-- (1) Savings and loan holding company functions transferred.-- (A) Transfer of functions.--There are transferred to the Board of Governors all functions of the Office of Thrift Supervision and the Director of the Office of Thrift Supervision (including the authority to issue orders) relating to-- (i) the supervision of-- (I) any savings and loan holding company; and (II) any subsidiary (other than a depository institution) of a savings and loan holding company; and (ii) all rulemaking authority of the Office of Thrift Supervision and the Director of the Office of Thrift Supervision relating to savings and loan holding companies. (B) Powers, authorities, rights, and duties.--The Board of Governors shall succeed to all powers, authorities, rights, and duties that were vested in the Office of Thrift Supervision and the Director of the Office of Thrift Supervision on the day before the transfer date relating to the functions and authority transferred under subparagraph (A). (2) All other functions transferred.-- (A) Board of governors.--All rulemaking authority of the Office of Thrift Supervision and the Director of the Office of Thrift Supervision under section 11 of the Home Owners' Loan Act (12 U.S.C. 1468) relating to transactions with affiliates and extensions of credit to executive officers, directors, and principal shareholders and under section 5(q) of such Act relating to tying arrangements is transferred to the Board of Governors.

(B) Comptroller of the currency.--Except as provided in paragraph (1) and subparagraph (A)-- (i) there are transferred to the Office of the Comptroller of the Currency and the Comptroller of the Currency-- (I) all functions of the Office of Thrift Supervision and the Director of the Office of Thrift Supervision, respectively, relating to Federal savings associations; and (II) all rulemaking authority of the Office of Thrift Supervision and the Director of the Office of Thrift Supervision, respectively, relating to savings associations; and (ii) the Office of the Comptroller of the Currency and the Comptroller of the Currency shall succeed to all powers, authorities, rights, and duties that were vested in the Office of Thrift Supervision and the Director of the Office of Thrift Supervision, respectively, on the day before the transfer date relating to the functions and authority transferred under clause (i). (C) Corporation.--Except as provided in paragraph (1) and subparagraphs (A) and (B)-- (i) all functions of the Office of Thrift Supervision and the Director of the Office of Thrift Supervision relating to State savings associations are transferred to the Corporation; and (ii) the Corporation shall succeed to all powers, authorities, rights, and duties that were vested in the Office of Thrift Supervision and the Director of the Office of Thrift Supervision on the day before the transfer date relating to the functions transferred under clause (i).

(c) Conforming Amendments.--Section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813) is amended-- (1) in subsection (q), by striking paragraphs (1) through (4) and inserting the following:
“(1) the Office of the Comptroller of the Currency, in the case of-- “(A) any national banking association; “(B) any Federal branch or agency of a foreign bank; and “(C) any Federal savings association; “(2) the Federal Deposit Insurance Corporation, in the case of-- “(A) any State nonmember insured bank; “(B) any foreign bank having an insured branch; and “(C) any State savings association; “(3) the Board of Governors of the Federal Reserve System, in the case of-- “(A) any State member bank; “(B) any branch or agency of a foreign bank with respect to any provision of the Federal Reserve Act which is made applicable under the International Banking Act of 1978; “(C) any foreign bank which does not operate an insured branch;

“(D) any agency or commercial lending company other than a Federal agency; “(E) supervisory or regulatory proceedings arising from the authority given to the Board of Governors under
section 7(c)(1) of the International Banking Act of
1978, including such proceedings under the Financial Institutions Supervisory Act of 1966; “(F) any bank holding company and any subsidiary (other than a depository institution) of a bank holding company; and “(G) any savings and loan holding company and any subsidiary (other than a depository institution) of a savings and loan holding company.”; and (2) in paragraphs (1) and (3) of subsection (u), by striking “(other than a bank holding company” and inserting “(other than a bank holding company or savings and loan holding company”.

(d) Consumer Protection.--Nothing in this section may be construed to limit or otherwise affect the transfer of powers under title X. SEC. 313. ABOLISHMENT.

Effective 90 days after the transfer date, the Office of Thrift Supervision and the position of Director of the Office of Thrift Supervision are abolished. SEC. 314. AMENDMENTS TO THE REVISED STATUTES.

(a) Amendment to Section 324.--Section 324 of the Revised Statutes of the United States (12 U.S.C. 1) is amended to read as follows:
“SEC. 324. COMPTROLLER OF THE CURRENCY.

“(a) Office of the Comptroller of the Currency Established.--There is established in the Department of the Treasury a bureau to be known as the `Office of the Comptroller of the Currency' which is charged with assuring the safety and soundness of, and compliance with laws and regulations, fair access to financial services, and fair treatment of customers by, the institutions and other persons subject to its jurisdiction. “(b) Comptroller of the Currency.-- “(1) In general.--The chief officer of the Office of the Comptroller of the Currency shall be known as the Comptroller of the Currency. The Comptroller of the Currency shall perform the duties of the Comptroller of the Currency under the general direction of the Secretary of the Treasury. The Secretary of the Treasury may not delay or prevent the issuance of any rule or the promulgation of any regulation by the Comptroller of the Currency, and may not intervene in any matter or proceeding before the Comptroller of the Currency (including agency enforcement actions), unless otherwise specifically provided by law. “(2) Additional authority.--The Comptroller of the Currency shall have the same authority with respect to functions transferred to the Comptroller of the Currency under the Enhancing Financial Institution Safety and Soundness Act of 2010 as was vested in the Director of the Office of Thrift Supervision on the transfer date, as defined in section 311 of that Act.”.

(b) Supervision of Federal Savings Associations.--Chapter 9 of title VII of the Revised Statutes of the United States (12 U.S.C. 1 et seq.) is amended by inserting after section 327A (12 U.S.C. 4a) the following:
“SEC. 327B. DEPUTY COMPTROLLER FOR THE SUPERVISION AND EXAMINATION OF FEDERAL SAVINGS ASSOCIATIONS.

“The Comptroller of the Currency shall designate a Deputy Comptroller, who shall be responsible for the supervision and examination of Federal savings associations.”.

(c) Amendment to Section 329.--Section 329 of the Revised Statutes of the United States (12 U.S.C. 11) is amended by inserting before the period at the end the following: “or any Federal savings association”. (d) Effective Date.--This section, and the amendments made by this section, shall take effect on the transfer date. SEC. 315. FEDERAL INFORMATION POLICY.

Section 3502(5) of title 44, United States Code, is amended by
inserting “Office of the Comptroller of the Currency,” after “the Securities and Exchange Commission,”. SEC. 316. SAVINGS PROVISIONS.

(a) Office of Thrift Supervision.-- (1) Existing rights, duties, and obligations not affected.-- Sections 312(b) and 313 shall not affect the validity of any right, duty, or obligation of the United States, the Director of the Office of Thrift Supervision, the Office of Thrift Supervision, or any other person, that existed on the day before the transfer date. (2) Continuation of suits.--This title shall not abate any action or proceeding commenced by or against the Director of the Office of Thrift Supervision or the Office of Thrift Supervision before the transfer date, except that-- (A) for any action or proceeding arising out of a function of the Office of Thrift Supervision or the Director of the Office of Thrift Supervision transferred to the Board of Governors by this title, the Board of Governors shall be substituted for the Office of Thrift Supervision or the Director of the Office of Thrift Supervision as a party to the action or proceeding on and after the transfer date; (B) for any action or proceeding arising out of a function of the Office of Thrift Supervision or the Director of the Office of Thrift Supervision transferred to the Office of the Comptroller of the Currency or the Comptroller of the Currency by this title, the Office of the Comptroller of the Currency or the Comptroller of the Currency shall be substituted for the Office of Thrift Supervision or the Director of the Office of Thrift Supervision, as the case may be, as a party to the action or proceeding on and after the transfer date; and (C) for any action or proceeding arising out of a function of the Office of Thrift Supervision or the Director of the Office of Thrift Supervision transferred to the Corporation by this title, the Corporation shall be substituted for the Office of Thrift Supervision or the Director of the Office of Thrift Supervision as a party to the action or proceeding on and after the transfer date.

(b) Continuation of Existing OTS Orders, Resolutions, Determinations, Agreements, Regulations, etc.--All orders, resolutions, determinations, agreements, and regulations, interpretative rules, other interpretations, guidelines, procedures, and other advisory materials, that have been issued, made, prescribed, or allowed to become effective by the Office of Thrift Supervision or the Director of the Office of Thrift Supervision, or by a court of competent jurisdiction, in the performance of functions that are transferred by this title and that are in effect on the day before the transfer date, shall continue in effect according to the terms of such orders, resolutions, determinations, agreements, and regulations, interpretative rules, other interpretations, guidelines, procedures, and other advisory materials, and shall be enforceable by or against-- (1) the Board of Governors, in the case of a function of the Office of Thrift Supervision or the Director of the Office of Thrift Supervision transferred to the Board of Governors, until modified, terminated, set aside, or superseded in accordance with applicable law by the Board of Governors, by any court of competent jurisdiction, or by operation of law; (2) the Office of the Comptroller of the Currency or the Comptroller of the Currency, in the case of a function of the Office of Thrift Supervision or the Director of the Office of Thrift Supervision transferred to the Office of the Comptroller of the Currency or the Comptroller of the Currency, respectively, until modified, terminated, set aside, or superseded in accordance with applicable law by the Office of the Comptroller of the Currency or the Comptroller of the Currency, by any court of competent jurisdiction, or by operation of law; and (3) the Corporation, in the case of a function of the Office of Thrift Supervision or the Director of the Office of Thrift Supervision transferred to the Corporation, until modified, terminated, set aside, or superseded in accordance with applicable law by the Corporation, by any court of competent jurisdiction, or by operation of law.

(c) Identification of Regulations Continued.-- (1) By the board of governors.--Not later than the transfer date, the Board of Governors shall-- (A) identify the regulations continued under subsection (b) that will be enforced by the Board of Governors; and (B) publish a list of the regulations identified under subparagraph (A) in the Federal Register. (2) By office of the comptroller of the currency.--Not later than the transfer date, the Office of the Comptroller of the Currency shall-- (A) after consultation with the Corporation, identify the regulations continued under subsection (b) that will be enforced by the Office of the Comptroller of the Currency; and (B) publish a list of the regulations identified under subparagraph (A) in the Federal Register. (3) By the corporation.--Not later than the transfer date, the Corporation shall-- (A) after consultation with the Office of the Comptroller of the Currency, identify the regulations continued under subsection (b) that will be enforced by the Corporation; and

(B) publish a list of the regulations identified under subparagraph (A) in the Federal Register.

(d) Status of Regulations Proposed or Not Yet Effective.-- (1) Proposed regulations.--Any proposed regulation of the Office of Thrift Supervision, which the Office of Thrift Supervision in performing functions transferred by this title, has proposed before the transfer date but has not published as a final regulation before such date, shall be deemed to be a proposed regulation of the Office of the Comptroller of the Currency or the Board of Governors, as appropriate, according to the terms of the proposed regulation. (2) Regulations not yet effective.--Any interim or final regulation of the Office of Thrift Supervision, which the Office of Thrift Supervision, in performing functions transferred by this title, has published before the transfer date but which has not become effective before that date, shall become effective as a regulation of the Office of the Comptroller of the Currency or the Board of Governors, as appropriate, according to the terms of the interim or final regulation, unless modified, terminated, set aside, or superseded in accordance with applicable law by the Office of the Comptroller of the Currency or the Board of Governors, as appropriate, by any court of competent jurisdiction, or by operation of law. SEC. 317. REFERENCES IN FEDERAL LAW TO FEDERAL BANKING AGENCIES.

On and after the transfer date, any reference in Federal law to the Director of the Office of Thrift Supervision or the Office of Thrift Supervision, in connection with any function of the Director of the Office of Thrift Supervision or the Office of Thrift Supervision transferred under section 312(b) or any other provision of this subtitle, shall be deemed to be a reference to the Comptroller of the Currency, the Office of the Comptroller of the Currency, the Chairperson of the Corporation, the Corporation, the Chairman of the Board of Governors, or the Board of Governors, as appropriate and consistent with the amendments made in subtitle E. SEC. 318. FUNDING.

(a) Compensation of Examiners.--Section 5240 of the Revised Statutes of the United States (12 U.S.C. 481 et seq.) is amended-- (1) in the second undesignated paragraph (12 U.S.C. 481), in the fourth sentence, by striking “without regard to the provisions of other laws applicable to officers or employees of the United States” and inserting the following: “set and adjusted subject to chapter 71 of title 5, United States Code, and without regard to the provisions of other laws applicable to officers or employees of the United States”; and (2) in the third undesignated paragraph (12 U.S.C. 482), in the first sentence, by striking “shall fix” and inserting “shall, subject to chapter 71 of title 5, United States Code, fix”.

(b) Funding of Office of the Comptroller of the Currency.--Chapter 4 of title LXII of the Revised Statutes is amended by inserting after
section 5240 (12 U.S.C. 481, 482) the following:
“Sec. 5240A. The Comptroller of the Currency may collect an assessment, fee, or other charge from any entity described in section 3(q)(1) of the Federal Deposit Insurance Act (12 U.S.C.

1813(q)(1)), as the Comptroller determines is necessary or appropriate to carry out the responsibilities of the Office of the Comptroller of the Currency. In establishing the amount of an assessment, fee, or charge collected from an entity under this section, the Comptroller of the Currency may take into account the nature and scope of the activities of the entity, the amount and type of assets that the entity holds, the financial and managerial condition of the entity, and any other factor, as the Comptroller of the Currency determines is appropriate. Funds derived from any assessment, fee, or charge collected or payment made pursuant to this section may be deposited by the Comptroller of the Currency in accordance with the provisions of section
5234. Such funds shall not be construed to be Government funds or
appropriated monies, and shall not be subject to apportionment for purposes of chapter 15 of title 31, United States Code, or any other provision of law. The authority of the Comptroller of the Currency under this section shall be in addition to the authority under section 5240.

“The Comptroller of the Currency shall have sole authority to determine the manner in which the obligations of the Office of the Comptroller of the Currency shall be incurred and its disbursements and expenses allowed and paid, in accordance with this section, except as provided in chapter 71 of title 5, United States Code (with respect to compensation).”. (c) Funding of Board of Governors.--Section 11 of the Federal Reserve Act (12 U.S.C. 248) is amended by adding at the end the following:
“(s) Assessments, Fees, and Other Charges for Certain Companies.-- “(1) In general.--The Board shall collect a total amount of assessments, fees, or other charges from the companies described in paragraph (2) that is equal to the total expenses the Board estimates are necessary or appropriate to carry out the supervisory and regulatory responsibilities of the Board with respect to such companies. “(2) Companies.--The companies described in this paragraph are-- “(A) all bank holding companies having total consolidated assets of $50,000,000,000 or more; “(B) all savings and loan holding companies having total consolidated assets of $50,000,000,000 or more; and “(C) all nonbank financial companies supervised by the Board under section 113 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.”.

(d) Corporation Examination Fees.--Section 10(e) of the Federal Deposit Insurance Act (12 U.S.C. 1820(e)) is amended by striking paragraph (1) and inserting the following:
“(1) Regular and special examinations of depository institutions.--The cost of conducting any regular examination or special examination of any depository institution under subsection (b)(2), (b)(3), or (d) or of any entity described in
section 3(q)(2) may be assessed by the Corporation against the
institution or entity to meet the expenses of the Corporation in carrying out such examinations.”.

(e) Effective Date.--This section, and the amendments made by this section, shall take effect on the transfer date.

SEC. 319. CONTRACTING AND LEASING AUTHORITY.

Notwithstanding the Federal Property and Administrative Services Act of 1949 (41 U.S.C. 251 et seq.) or any other provision of law (except the full and open competition requirements of the Competition in Contracting Act), the Office of the Comptroller of the Currency may-- (1) enter into and perform contracts, execute instruments, and acquire real property (or property interest) as the Comptroller deems necessary to carry out the duties and responsibilities of the Office of the Comptroller of the Currency; and (2) hold, maintain, sell, lease, or otherwise dispose of the property (or property interest) acquired under paragraph (1).

Subtitle B--Transitional Provisions

SEC. 321. INTERIM USE OF FUNDS, PERSONNEL, AND PROPERTY OF THE OFFICE OF THRIFT SUPERVISION.

(a) In General.--Before the transfer date, the Office of the Comptroller of the Currency, the Corporation, and the Board of Governors shall-- (1) consult and cooperate with the Office of Thrift Supervision to facilitate the orderly transfer of functions to the Office of the Comptroller of the Currency, the Corporation, and the Board of Governors in accordance with this title; (2) determine jointly, from time to time-- (A) the amount of funds necessary to pay any expenses associated with the transfer of functions (including expenses for personnel, property, and administrative services) during the period beginning on the date of enactment of this Act and ending on the transfer date; (B) which personnel are appropriate to facilitate the orderly transfer of functions by this title; and (C) what property and administrative services are necessary to support the Office of the Comptroller of the Currency, the Corporation, and the Board of Governors during the period beginning on the date of enactment of this Act and ending on the transfer date; and (3) take such actions as may be necessary to provide for the orderly implementation of this title.

(b) Agency Consultation.--When requested jointly by the Office of the Comptroller of the Currency, the Corporation, and the Board of Governors to do so before the transfer date, the Office of Thrift Supervision shall-- (1) pay to the Office of the Comptroller of the Currency, the Corporation, or the Board of Governors, as applicable, from funds obtained by the Office of Thrift Supervision through assessments, fees, or other charges that the Office of Thrift Supervision is authorized by law to impose, such amounts as the Office of the Comptroller of the Currency, the Corporation, and the Board of Governors jointly determine to be necessary under subsection (a); (2) detail to the Office of the Comptroller of the Currency, the Corporation, or the Board of Governors, as applicable, such personnel as the Office of the Comptroller of the Currency, the Corporation, and the Board of Governors jointly determine to be appropriate under subsection (a); and

(3) make available to the Office of the Comptroller of the Currency, the Corporation, or the Board of Governors, as applicable, such property and provide to the Office of the Comptroller of the Currency, the Corporation, or the Board of Governors, as applicable, such administrative services as the Office of the Comptroller of the Currency, the Corporation, and the Board of Governors jointly determine to be necessary under subsection (a).

(c) Notice Required.--The Office of the Comptroller of the Currency, the Corporation, and the Board of Governors shall jointly give the Office of Thrift Supervision reasonable prior notice of any request that the Office of the Comptroller of the Currency, the Corporation, and the Board of Governors jointly intend to make under subsection (b). SEC. 322. TRANSFER OF EMPLOYEES.

(a) In General.--
(1) Office of thrift supervision employees.-- (A) In general.--Except as provided in section 1064, all employees of the Office of Thrift Supervision shall be transferred to the Office of the Comptroller of the Currency or the Corporation for employment in accordance with this section. (B) Allocating employees for transfer to receiving agencies.--The Director of the Office of Thrift Supervision, the Comptroller of the Currency, and the Chairperson of the Corporation shall-- (i) jointly determine the number of employees of the Office of Thrift Supervision necessary to perform or support the functions that are transferred to the Office of the Comptroller of the Currency or the Corporation by this title; and (ii) consistent with the determination under clause (i), jointly identify employees of the Office of Thrift Supervision for transfer to the Office of the Comptroller of the Currency or the Corporation. (2) Employees transferred; service periods credited.--For purposes of this section, periods of service with a Federal home loan bank, a joint office of Federal home loan banks, or a Federal reserve bank shall be credited as periods of service with a Federal agency. (3) Appointment authority for excepted service transferred.-- (A) In general.--Except as provided in subparagraph (B), any appointment authority of the Office of Thrift Supervision under Federal law that relates to the functions transferred under section 312, including the regulations of the Office of Personnel Management, for filling the positions of employees in the excepted service shall be transferred to the Comptroller of the Currency or the Chairperson of the Corporation, as appropriate. (B) Declining transfers allowed.--The Comptroller of the Currency or the Chairperson of the Corporation may decline to accept a transfer of authority under subparagraph (A) (and the employees appointed under that authority) to the extent that such authority relates to positions excepted from the competitive service because of their

confidential, policy-making, policy-determining, or policy-advocating character. (4) Additional appointment authority.--Notwithstanding any other provision of law, the Office of the Comptroller of the Currency and the Corporation may appoint transferred employees to positions in the Office of the Comptroller of the Currency or the Corporation, respectively.

(b) Timing of Transfers and Position Assignments.--Each employee to be transferred under subsection (a)(1) shall-- (1) be transferred not later than 90 days after the transfer date; and (2) receive notice of the position assignment of the employee not later than 120 days after the effective date of the transfer of the employee.

(c) Transfer of Functions.--
(1) In general.--Notwithstanding any other provision of law, the transfer of employees under this subtitle shall be deemed a transfer of functions for the purpose of section 3503 of title 5, United States Code. (2) Priority.--If any provision of this subtitle conflicts with any protection provided to a transferred employee under
section 3503 of title 5, United States Code, the provisions of
this subtitle shall control.

(d) Employee Status and Eligibility.--The transfer of functions and employees under this subtitle, and the abolishment of the Office of Thrift Supervision under section 313, shall not affect the status of the transferred employees as employees of an agency of the United States under any provision of law. (e) Equal Status and Tenure Positions.-- (1) Status and tenure.--Each transferred employee from the Office of Thrift Supervision shall be placed in a position at the Office of the Comptroller of the Currency or the Corporation with the same status and tenure as the transferred employee held on the day before the date on which the employee was transferred. (2) Functions.--To the extent practicable, each transferred employee shall be placed in a position at the Office of the Comptroller of the Currency or the Corporation, as applicable, responsible for the same functions and duties as the transferred employee had on the day before the date on which the employee was transferred, in accordance with the expertise and preferences of the transferred employee.

(f) No Additional Certification Requirements.--An examiner who is a transferred employee shall not be subject to any additional certification requirements before being placed in a comparable position at the Office of the Comptroller of the Currency or the Corporation, if the examiner carries out examinations of the same type of institutions as an employee of the Office of the Comptroller of the Currency or the Corporation as the employee was responsible for carrying out before the date on which the employee was transferred. (g) Personnel Actions Limited.-- (1) Protection.-- (A) In general.--Except as provided in paragraph (2), each affected employee shall not, during the 30-month period beginning on the transfer date, be involuntarily

separated, or involuntarily reassigned outside his or her locality pay area. (B) Affected employees.-- For purposes of this paragraph, the term “affected employee” means-- (i) an employee transferred from the Office of Thrift Supervision holding a permanent position on the day before the transfer date; and (ii) an employee of the Office of the Comptroller of the Currency or the Corporation holding a permanent position on the day before the transfer date. (2) Exceptions.--Paragraph (1) does not limit the right of the Office of the Comptroller of the Currency or the Corporation to-- (A) separate an employee for cause or for unacceptable performance; (B) terminate an appointment to a position excepted from the competitive service because of its confidential policy-making, policy-determining, or policy-advocating character; or (C) reassign an employee outside such employee's locality pay area when the Office of the Comptroller of the Currency or the Corporation determines that the reassignment is necessary for the efficient operation of the agency.

(h) Pay.--
(1) 30-month protection.--Except as provided in paragraph (2), during the 30-month period beginning on the date on which the employee was transferred under this subtitle, a transferred employee shall be paid at a rate that is not less than the basic rate of pay, including any geographic differential, that the transferred employee received during the pay period immediately preceding the date on which the employee was transferred. Notwithstanding the preceding sentence, if the employee was receiving a higher rate of basic pay on a temporary basis (because of a temporary assignment, temporary promotion, or other temporary action) immediately before the transfer, the Agency may reduce the rate of basic pay on the date the rate would have been reduced but for the transfer, and the protected rate for the remainder of the 30-month period will be the reduced rate that would have applied but for the transfer. (2) Exceptions.--The Comptroller of the Currency or the Corporation may reduce the rate of basic pay of a transferred employee-- (A) for cause, including for unacceptable performance; or (B) with the consent of the transferred employee. (3) Protection only while employed.-- This subsection shall apply to a transferred employee only during the period that the transferred employee remains employed by Office of the Comptroller of the Currency or the Corporation. (4) Pay increases permitted.--Nothing in this subsection shall limit the authority of the Comptroller of the Currency or the Chairperson of the Corporation to increase the pay of a transferred employee.

(i) Benefits.--
(1) Retirement benefits for transferred employees.--

(A) In general.--
(i) Continuation of existing retirement plan.--Each transferred employee shall remain enrolled in the retirement plan of the transferred employee, for as long as the transferred employee is employed by the Office of the Comptroller of the Currency or the Corporation. (ii) Employer's contribution.--The Comptroller of the Currency or the Chairperson of the Corporation, as appropriate, shall pay any employer contributions to the existing retirement plan of each transferred employee, as required under each such existing retirement plan. (B) Definition.--In this paragraph, the term “existing retirement plan” means, with respect to a transferred employee, the retirement plan (including the Financial Institutions Retirement Fund), and any associated thrift savings plan, of the agency from which the employee was transferred in which the employee was enrolled on the day before the date on which the employee was transferred. (2) Benefits other than retirement benefits.-- (A) During first year.-- (i) Existing plans continue.--During the 1-year period following the transfer date, each transferred employee may retain membership in any employee benefit program (other than a retirement benefit program) of the agency from which the employee was transferred under this title, including any dental, vision, long term care, or life insurance program to which the employee belonged on the day before the transfer date. (ii) Employer's contribution.--The Office of the Comptroller of the Currency or the Corporation, as appropriate, shall pay any employer cost required to extend coverage in the benefit program to the transferred employee as required under that program or negotiated agreements. (B) Dental, vision, or life insurance after first year.--If, after the 1-year period beginning on the transfer date, the Office of the Comptroller of the Currency or the Corporation determines that the Office of the Comptroller of the Currency or the Corporation, as the case may be, will not continue to participate in any dental, vision, or life insurance program of an agency from which an employee was transferred, a transferred employee who is a member of the program may, before the decision takes effect and without regard to any regularly scheduled open season, elect to enroll in-- (i) the enhanced dental benefits program established under chapter 89A of title 5, United States Code; (ii) the enhanced vision benefits established under chapter 89B of title 5, United States Code; and (iii) the Federal Employees' Group Life Insurance Program established under chapter 87 of title 5, United States Code, without regard to any requirement of insurability.

(C) Long term care insurance after 1st year.-- If, after the 1-year period beginning on the transfer date, the Office of the Comptroller of the Currency or the Corporation determines that the Office of the Comptroller of the Currency or the Corporation, as appropriate, will not continue to participate in any long term care insurance program of an agency from which an employee transferred, a transferred employee who is a member of such a program may, before the decision takes effect, elect to apply for coverage under the Federal Long Term Care Insurance Program established under chapter 90 of title 5, United States Code, under the underwriting requirements applicable to a new active workforce member, as described in part 875 of title 5, Code of Federal Regulations (or any successor thereto). (D) Contribution of transferred employee.-- (i) In general.--Subject to clause (ii), a transferred employee who is enrolled in a plan under the Federal Employees Health Benefits Program shall pay any employee contribution required under the plan. (ii) Cost differential.--The Office of the Comptroller of the Currency or the Corporation, as applicable, shall pay any difference in cost between the employee contribution required under the plan provided to transferred employees by the agency from which the employee transferred on the date of enactment of this Act and the plan provided by the Office of the Comptroller of the Currency or the Corporation, as the case may be, under this section. (iii) Funds transfer.--The Office of the Comptroller of the Currency or the Corporation, as the case may be, shall transfer to the Employees Health Benefits Fund established under section 8909 of title 5, United States Code, an amount determined by the Director of the Office of Personnel Management, after consultation with the Comptroller of the Currency or the Chairperson of the Corporation, as the case may be, and the Office of Management and Budget, to be necessary to reimburse the Fund for the cost to the Fund of providing any benefits under this subparagraph that are not otherwise paid for by a transferred employee under clause (i). (E) Special provisions to ensure continuation of life insurance benefits.-- (i) In general.--An annuitant, as defined in
section 8901 of title 5, United States Code, who
is enrolled in a life insurance plan administered by an agency from which employees are transferred under this title on the day before the transfer date shall be eligible for coverage by a life insurance plan under sections 8706(b), 8714a, 8714b, or 8714c of title 5, United States Code, or by a life insurance plan established by the Office of the Comptroller of the Currency or the Corporation, as applicable, without regard to any regularly scheduled open season or any requirement of insurability. (ii) Contribution of transferred employee.--

(I) In general.--Subject to subclause (II), a transferred employee enrolled in a life insurance plan under this subparagraph shall pay any employee contribution required by the plan. (II) Cost differential.--The Office of the Comptroller of the Currency or the Corporation, as the case may be, shall pay any difference in cost between the benefits provided by the agency from which the employee transferred on the date of enactment of this Act and the benefits provided under this section. (III) Funds transfer.--The Office of the Comptroller of the Currency or the Corporation, as the case may be, shall transfer to the Federal Employees' Group Life Insurance Fund established under
section 8714 of title 5, United States
Code, an amount determined by the Director of the Office of Personnel Management, after consultation with the Comptroller of the Currency or the Chairperson of the Corporation, as the case may be, and the Office of Management and Budget, to be necessary to reimburse the Federal Employees' Group Life Insurance Fund for the cost to the Federal Employees' Group Life Insurance Fund of providing benefits under this subparagraph not otherwise paid for by a transferred employee under subclause (I). (IV) Credit for time enrolled in other plans.--For any transferred employee, enrollment in a life insurance plan administered by the agency from which the employee transferred, immediately before enrollment in a life insurance plan under chapter 87 of title 5, United States Code, shall be considered as enrollment in a life insurance plan under that chapter for purposes of section 8706(b)(1)(A) of title 5, United States Code.

(j) Incorporation Into Agency Pay System.-- Not later than 30 months after the transfer date, the Comptroller of the Currency and the Chairperson of the Corporation shall place each transferred employee into the established pay system and structure of the appropriate employing agency.

(k) Equitable Treatment.--In administering the provisions of this
section, the Comptroller of the Currency and the Chairperson of the
Corporation--
(1) may not take any action that would unfairly disadvantage a transferred employee relative to any other employee of the Office of the Comptroller of the Currency or the Corporation on the basis of prior employment by the Office of Thrift Supervision; (2) may take such action as is appropriate in an individual case to ensure that a transferred employee receives equitable treatment, with respect to the status, tenure, pay, benefits (other than benefits under programs administered by the Office of Personnel Management), and accrued leave or vacation time for prior periods of service with any Federal agency of the transferred employee;

(3) shall, jointly with the Director of the Office of Thrift Supervision, develop and adopt procedures and safeguards designed to ensure that the requirements of this subsection are met; and (4) shall conduct a study detailing the position assignments of all employees transferred pursuant to subsection (a), describing the procedures and safeguards adopted pursuant to paragraph (3), and demonstrating that the requirements of this subsection have been met; and shall, not later than 365 days after the transfer date, submit a copy of such study to Congress.

(l) Reorganization.--
(1) In general.--If the Comptroller of the Currency or the Chairperson of the Corporation determines, during the 2-year period beginning 1 year after the transfer date, that a reorganization of the staff of the Office of the Comptroller of the Currency or the Corporation, respectively, is required, the reorganization shall be deemed a “major reorganization” for purposes of affording affected employees retirement under section 8336(d)(2) or 8414(b)(1)(B) of title 5, United States Code. (2) Service credit.--For purposes of this subsection, periods of service with a Federal home loan bank or a joint office of Federal home loan banks shall be credited as periods of service with a Federal agency. SEC. 323. PROPERTY TRANSFERRED.

(a) Property Defined.--For purposes of this section, the term “property” includes all real property (including leaseholds) and all personal property, including computers, furniture, fixtures, equipment, books, accounts, records, reports, files, memoranda, paper, reports of examination, work papers, and correspondence related to such reports, and any other information or materials. (b) Property of the Office of Thrift Supervision.-- (1) In general.--No later than 90 days after the transfer date, all property of the Office of Thrift Supervision (other than property described under paragraph (b)(2)) that the Comptroller of the Currency and the Chairperson of the Corporation jointly determine is used, on the day before the transfer date, to perform or support the functions of the Office of Thrift Supervision transferred to the Office of the Comptroller of the Currency or the Corporation under this title, shall be transferred to the Office of the Comptroller of the Currency or the Corporation in a manner consistent with the transfer of employees under this subtitle. (2) Personal property.--All books, accounts, records, reports, files, memoranda, papers, documents, reports of examination, work papers, and correspondence of the Office of Thrift Supervision that the Comptroller of the Currency, the Chairperson of the Corporation, and the Chairman of the Board of Governors jointly determine is used, on the day before the transfer date, to perform or support the functions of the Office of Thrift Supervision transferred to the Board of Governors under this title shall be transferred to the Board of Governors in a manner consistent with the purposes of this title.

(c) Contracts Related to Property Transferred.--Each contract, agreement, lease, license, permit, and similar arrangement

relating to property transferred to the Office of the Comptroller of the Currency or the Corporation by this section shall be transferred to the Office of the Comptroller of the Currency or the Corporation, as appropriate, together with the property to which it relates. (d) Preservation of Property.--Property identified for transfer under this section shall not be altered, destroyed, or deleted before transfer under this section. SEC. 324. FUNDS TRANSFERRED.

The funds that, on the day before the transfer date, the Director of the Office of Thrift Supervision (in consultation with the Comptroller of the Currency, the Chairperson of the Corporation, and the Chairman of the Board of Governors) determines are not necessary to dispose of the affairs of the Office of Thrift Supervision under section 325 and are available to the Office of Thrift Supervision to pay the expenses of the Office of Thrift Supervision-- (1) relating to the functions of the Office of Thrift Supervision transferred under section 312(b)(2)(B), shall be transferred to the Office of the Comptroller of the Currency on the transfer date; (2) relating to the functions of the Office of Thrift Supervision transferred under section 312(b)(2)(C), shall be transferred to the Corporation on the transfer date; and (3) relating to the functions of the Office of Thrift Supervision transferred under section 312(b)(1)(A), shall be transferred to the Board of Governors on the transfer date. SEC. 325. DISPOSITION OF AFFAIRS.

(a) Authority of Director.--During the 90-day period beginning on the transfer date, the Director of the Office of Thrift Supervision-- (1) shall, solely for the purpose of winding up the affairs of the Office of Thrift Supervision relating to any function transferred to the Office of the Comptroller of the Currency, the Corporation, or the Board of Governors under this title-- (A) manage the employees of the Office of Thrift Supervision who have not yet been transferred and provide for the payment of the compensation and benefits of the employees that accrue before the date on which the employees are transferred under this title; and (B) manage any property of the Office of Thrift Supervision, until the date on which the property is transferred under section 323; and (2) may take any other action necessary to wind up the affairs of the Office of Thrift Supervision.

(b) Status of Director.--
(1) In general.--Notwithstanding the transfer of functions under this subtitle, during the 90-day period beginning on the transfer date, the Director of the Office of Thrift Supervision shall retain and may exercise any authority vested in the Director of the Office of Thrift Supervision on the day before the transfer date, only to the extent necessary-- (A) to wind up the Office of Thrift Supervision; and (B) to carry out the transfer under this subtitle during such 90-day period.

(2) Other provisions.--For purposes of paragraph (1), the Director of the Office of Thrift Supervision shall, during the 90-day period beginning on the transfer date, continue to be-- (A) treated as an officer of the United States; and (B) entitled to receive compensation at the same annual rate of basic pay that the Director of the Office of Thrift Supervision received on the day before the transfer date. SEC. 326. CONTINUATION OF SERVICES.

Any agency, department, or other instrumentality of the United States, and any successor to any such agency, department, or instrumentality, that was, before the transfer date, providing support services to the Office of Thrift Supervision in connection with functions transferred to the Office of the Comptroller of the Currency, the Corporation or the Board of Governors under this title, shall-- (1) continue to provide such services, subject to reimbursement by the Office of the Comptroller of the Currency, the Corporation, or the Board of Governors, until the transfer of functions under this title is complete; and (2) consult with the Comptroller of the Currency, the Chairperson of the Corporation, or the Chairman of the Board of Governors, as appropriate, to coordinate and facilitate a prompt and orderly transition. SEC. 327. IMPLEMENTATION PLAN AND REPORTS.

(a) Plan Submission.--Within 180 days of the enactment of the Dodd- Frank Wall Street Reform and Consumer Protection Act, the Board of Governors, the Corporation, the Office of the Comptroller of the Currency, and the Office of Thrift Supervision, shall jointly submit a plan to the Committee on Banking, Housing, and Urban Affairs of the Senate, the Committee on Financial Services of the House of Representatives, and the Inspectors General of the Department of the Treasury, the Corporation, and the Board of Governors detailing the steps the Board of Governors, the Corporation, the Office of the Comptroller of the Currency, and the Office of Thrift Supervision will take to implement the provisions of sections 301 through 326, and the provisions of the amendments made by such sections. (b) Inspectors General Review of the Plan.--Within 60 days of receiving the plan required under subsection (a), the Inspectors General of the Department of the Treasury, the Corporation, and the Board of Governors shall jointly provide a written report to the Board of Governors, the Corporation, the Office of the Comptroller of the Currency, and the Office of Thrift Supervision and shall submit a copy to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives detailing whether the plan conforms with the provisions of sections 301 through 326, and the provisions of the amendments made by such sections, including-- (1) whether the plan sufficiently takes into consideration the orderly transfer of personnel; (2) whether the plan describes procedures and safeguards to ensure that the Office of Thrift Supervision employees are not unfairly disadvantaged relative to employees of the Office of the Comptroller of the Currency and the Corporation;

(3) whether the plan sufficiently takes into consideration the orderly transfer of authority and responsibilities; (4) whether the plan sufficiently takes into consideration the effective transfer of funds; (5) whether the plan sufficiently takes in consideration the orderly transfer of property; and (6) any additional recommendations for an orderly and effective process.

(c) Implementation Reports.--Not later than 6 months after the date on which the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives receives the report required under subsection (b), and every 6 months thereafter until all aspects of the plan have been implemented, the Inspectors General of the Department of the Treasury, the Corporation, and the Board of Governors shall jointly provide a written report on the status of the implementation of the plan to the Board of Governors, the Corporation, the Office of the Comptroller of the Currency, and the Office of Thrift Supervision and shall submit a copy to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives.

Subtitle C--Federal Deposit Insurance Corporation

SEC. 331. DEPOSIT INSURANCE REFORMS.

(a) Size Distinctions.--Section 7(b)(2) of the Federal Deposit Insurance Act (12 U.S.C. 1817(b)(2)) is amended-- (1) by striking subparagraph (D); and (2) by redesignating subparagraph (C) as subparagraph (D).

(b) Assessment Base.--The Corporation shall amend the regulations issued by the Corporation under section 7(b)(2) of the Federal Deposit Insurance Act (12 U.S.C. 1817(b)(2)) to define the term “assessment base” with respect to an insured depository institution for purposes of that section 7(b)(2), as an amount equal to-- (1) the average consolidated total assets of the insured depository institution during the assessment period; minus (2) the sum of-- (A) the average tangible equity of the insured depository institution during the assessment period; and (B) in the case of an insured depository institution that is a custodial bank (as defined by the Corporation, based on factors including the percentage of total revenues generated by custodial businesses and the level of assets under custody) or a banker's bank (as that term is used in section 5136 of the Revised Statutes (12 U.S.C. 24)), an amount that the Corporation determines is necessary to establish assessments consistent with the definition under section 7(b)(1) of the Federal Deposit Insurance Act (12 U.S.C. 1817(b)(1)) for a custodial bank or a banker's bank.

SEC. 332. ELIMINATION OF PROCYCLICAL ASSESSMENTS.

Section 7(e) of the Federal Deposit Insurance Act is amended--
(1) in paragraph (2)--
(A) by amending subparagraph (B) to read as follows:
“(B) Limitation.--The Board of Directors may, in its sole discretion, suspend or limit the declaration of payment of dividends under subparagraph (A).”; (B) by amending subparagraph (C) to read as follows:
“(C) Notice and opportunity for comment.--The Corporation shall prescribe, by regulation, after notice and opportunity for comment, the method for the declaration, calculation, distribution, and payment of dividends under this paragraph”; and (C) by striking subparagraphs (D) through (G); and (2) in paragraph (4)(A) by striking “paragraphs (2)(D) and” and inserting “paragraphs (2) and”. SEC. 333. ENHANCED ACCESS TO INFORMATION FOR DEPOSIT INSURANCE PURPOSES.

(a) Section 7(a)(2)(B) of the Federal Deposit Insurance Act is amended by striking “agreement” and inserting “consultation”. (b) Section 7(b)(1)(E) of the Federal Deposit Insurance Act is amended-- (1) in clause (i), by striking “such as” and inserting “including”; and (2) in clause (iii), by striking “Corporation” and inserting “Corporation, except as provided in section 7(a)(2)(B)”. SEC. 334. TRANSITION RESERVE RATIO REQUIREMENTS TO REFLECT NEW ASSESSMENT BASE.

(a) Section 7(b)(3)(B) of the Federal Deposit Insurance Act is amended to read as follows:
“(B) Minimum reserve ratio.--The reserve ratio designated by the Board of Directors for any year may not be less than 1.35 percent of estimated insured deposits, or the comparable percentage of the assessment base set forth in paragraph (2)(C).”.

(b) Section 3(y)(3) of the Federal Deposit Insurance Act is amended by inserting “, or such comparable percentage of the assessment base set forth in section 7(b)(2)(C)” before the period.

(c) For a period of not less than 5 years after the date of the enactment of this title, the Federal Deposit Insurance Corporation shall make available to the public the reserve ratio and the designated reserve ratio using both estimated insured deposits and the assessment base under section 7(b)(2)(C) of the Federal Deposit Insurance Act.

(d) Reserve Ratio.--Notwithstanding the timing requirements of
section 7(b)(3)(E)(ii) of the Federal Deposit Insurance Act, the
Corporation shall take such steps as may be necessary for the reserve ratio of the Deposit Insurance Fund to reach 1.35 percent of estimated insured deposits by September 30, 2020. (e) Offset.--In setting the assessments necessary to meet the requirements of subsection (d), the Corporation shall offset the effect of subsection (d) on insured depository institutions with total consolidated assets of less than $10,000,000,000.

SEC. 335. PERMANENT INCREASE IN DEPOSIT AND SHARE INSURANCE.

(a) Permanent Increase in Deposit Insurance.--Section 11(a)(1)(E) of the Federal Deposit Insurance Act (12 U.S.C. 1821(a)(1)(E)) is amended-- (1) by striking “$100,000” and inserting “$250,000”; and (2) by adding at the end the following new sentences:
“Notwithstanding any other provision of law, the increase in the standard maximum deposit insurance amount to $250,000 shall apply to depositors in any institution for which the Corporation was appointed as receiver or conservator on or after January 1, 2008, and before October 3, 2008. The Corporation shall take such actions as are necessary to carry out the requirements of this section with respect to such depositors, without regard to any time limitations under this Act. In implementing this and the preceding 2 sentences, any payment on a deposit claim made by the Corporation as receiver or conservator to a depositor above the standard maximum deposit insurance amount in effect at the time of the appointment of the Corporation as receiver or conservator shall be deemed to be part of the net amount due to the depositor under subparagraph (B).”

(b) Permanent Increase in Share Insurance.--Section 207(k)(5) of the Federal Credit Union Act (12 U.S.C. 1787(k)(5)) is amended by striking “$100,000” and inserting “$250,000”. SEC. 336. MANAGEMENT OF THE FEDERAL DEPOSIT INSURANCE CORPORATION.

(a) In General.--Section 2 of the Federal Deposit Insurance Act (12 U.S.C. 1812) is amended-- (1) in subsection (a)(1)(B), by striking “Director of the Office of Thrift Supervision” and inserting “Director of the Consumer Financial Protection Bureau”; (2) by amending subsection (d)(2) to read as follows:
“(2) Acting officials may serve.--In the event of a vacancy in the office of the Comptroller of the Currency or the office of Director of the Consumer Financial Protection Bureau and pending the appointment of a successor, or during the absence or disability of the Comptroller of the Currency or the Director of the Consumer Financial Protection Bureau, the acting Comptroller of the Currency or the acting Director of the Consumer Financial Protection Bureau, as the case may be, shall be a member of the Board of Directors in the place of the Comptroller or Director.”; and (3) in subsection (f)(2), by striking “Office of Thrift Supervision” and inserting “Consumer Financial Protection Bureau”.

(b) Effective Date.--This section, and the amendments made by this section, shall take effect on the transfer date.

Subtitle D--Other Matters

SEC. 341. BRANCHING.

Notwithstanding the Federal Deposit Insurance Act (12 U.S.C. 1811 et seq.), the Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.), or any other provision of Federal or State law, a savings association that becomes a bank may--

(1) continue to operate any branch or agency that the savings association operated immediately before the savings association became a bank; and (2) establish, acquire, and operate additional branches and agencies at any location within any State in which the savings association operated a branch immediately before the savings association became a bank, if the law of the State in which the branch is located, or is to be located, would permit establishment of the branch if the bank were a State bank chartered by such State. SEC. 342. OFFICE OF MINORITY AND WOMEN INCLUSION.

(a) Office of Minority and Women Inclusion.-- (1) Establishment.-- (A) In general.--Except as provided in subparagraph (B), not later than 6 months after the date of enactment of this Act, each agency shall establish an Office of Minority and Women Inclusion that shall be responsible for all matters of the agency relating to diversity in management, employment, and business activities. (B) Bureau.--The Bureau shall establish an Office of Minority and Women Inclusion not later than 6 months after the designated transfer date established under
section 1062.
(2) Transfer of responsibilities.--Each agency that, on the day before the date of enactment of this Act, assigned the responsibilities described in paragraph (1) (or comparable responsibilities) to another office of the agency shall ensure that such responsibilities are transferred to the Office. (3) Duties with respect to civil rights laws.--The responsibilities described in paragraph (1) do not include enforcement of statutes, regulations, or executive orders pertaining to civil rights, except each Director shall coordinate with the agency administrator, or the designee of the agency administrator, regarding the design and implementation of any remedies resulting from violations of such statutes, regulations, or executive orders.

(b) Director.--
(1) In general.--The Director of each Office shall be appointed by, and shall report to, the agency administrator. The position of Director shall be a career reserved position in the Senior Executive Service, as that position is defined in section 3132 of title 5, United States Code, or an equivalent designation. (2) Duties.--Each Director shall develop standards for-- (A) equal employment opportunity and the racial, ethnic, and gender diversity of the workforce and senior management of the agency; (B) increased participation of minority-owned and women-owned businesses in the programs and contracts of the agency, including standards for coordinating technical assistance to such businesses; and (C) assessing the diversity policies and practices of entities regulated by the agency. (3) Other duties.--Each Director shall advise the agency administrator on the impact of the policies and regulations of the agency on minority-owned and women-owned businesses.

(4) Rule of construction.--Nothing in paragraph (2)(C) may be construed to mandate any requirement on or otherwise affect the lending policies and practices of any regulated entity, or to require any specific action based on the findings of the assessment.

(c) Inclusion in All Levels of Business Activities.-- (1) In general.-- The Director of each Office shall develop and implement standards and procedures to ensure, to the maximum extent possible, the fair inclusion and utilization of minorities, women, and minority-owned and women- owned businesses in all business and activities of the agency at all levels, including in procurement, insurance, and all types of contracts. (2) Contracts.--The procedures established by each agency for review and evaluation of contract proposals and for hiring service providers shall include, to the extent consistent with applicable law, a component that gives consideration to the diversity of the applicant. Such procedure shall include a written statement, in a form and with such content as the Director shall prescribe, that a contractor shall ensure, to the maximum extent possible, the fair inclusion of women and minorities in the workforce of the contractor and, as applicable, subcontractors. (3) Termination.-- (A) Determination.--The standards and procedures developed and implemented under this subsection shall include a procedure for the Director to make a determination whether an agency contractor, and, as applicable, a subcontractor has failed to make a good faith effort to include minorities and women in their workforce. (B) Effect of determination.-- (i) Recommendation to agency administrator.-- Upon a determination described in subparagraph (A), the Director shall make a recommendation to the agency administrator that the contract be terminated. (ii) Action by agency administrator.--Upon receipt of a recommendation under clause (i), the agency administrator may-- (I) terminate the contract; (II) make a referral to the Office of Federal Contract Compliance Programs of the Department of Labor; or (III) take other appropriate action.

(d) Applicability.--This section shall apply to all contracts of an agency for services of any kind, including the services of financial institutions, investment banking firms, mortgage banking firms, asset management firms, brokers, dealers, financial services entities, underwriters, accountants, investment consultants, and providers of legal services. The contracts referred to in this subsection include all contracts for all business and activities of an agency, at all levels, including contracts for the issuance or guarantee of any debt, equity, or security, the sale of assets, the management of the assets of the agency, the making of equity investments by the agency, and the implementation by the agency of programs to address economic recovery.

(e) Reports.--Each Office shall submit to Congress an annual report regarding the actions taken by the agency and the Office pursuant to this section, which shall include-- (1) a statement of the total amounts paid by the agency to contractors since the previous report; (2) the percentage of the amounts described in paragraph (1) that were paid to contractors described in subsection (c)(1); (3) the successes achieved and challenges faced by the agency in operating minority and women outreach programs; (4) the challenges the agency may face in hiring qualified minority and women employees and contracting with qualified minority-owned and women-owned businesses; and (5) any other information, findings, conclusions, and recommendations for legislative or agency action, as the Director determines appropriate.

(f) Diversity in Agency Workforce.--Each agency shall take affirmative steps to seek diversity in the workforce of the agency at all levels of the agency in a manner consistent with applicable law. Such steps shall include-- (1) recruiting at historically black colleges and universities, Hispanic-serving institutions, women's colleges, and colleges that typically serve majority minority populations; (2) sponsoring and recruiting at job fairs in urban communities; (3) placing employment advertisements in newspapers and magazines oriented toward minorities and women; (4) partnering with organizations that are focused on developing opportunities for minorities and women to place talented young minorities and women in industry internships, summer employment, and full-time positions; (5) where feasible, partnering with inner-city high schools, girls' high schools, and high schools with majority minority populations to establish or enhance financial literacy programs and provide mentoring; and (6) any other mass media communications that the Office determines necessary.

(g) Definitions.--For purposes of this
section, the following definitions shall apply:
(1) Agency.--The term “agency” means-- (A) the Departmental Offices of the Department of the Treasury; (B) the Corporation; (C) the Federal Housing Finance Agency; (D) each of the Federal reserve banks; (E) the Board; (F) the National Credit Union Administration; (G) the Office of the Comptroller of the Currency; (H) the Commission; and (I) the Bureau. (2) Agency administrator.--The term “agency administrator” means the head of an agency. (3) Minority.--The term “minority” has the same meaning as in section 1204(c) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1811 note). (4) Minority-owned business.--The term “minority-owned business” has the same meaning as in section 21A(r)(4)(A)

of the Federal Home Loan Bank Act (12 U.S.C. 1441a(r)(4)(A)), as in effect on the day before the transfer date. (5) Office.--The term “Office” means the Office of Minority and Women Inclusion established by an agency under subsection (a). (6) Women-owned business.--The term “women-owned business” has the meaning given the term “women's business” in section 21A(r)(4)(B) of the Federal Home Loan Bank Act (12 U.S.C. 1441a(r)(4)(B)), as in effect on the day before the transfer date. SEC. 343. INSURANCE OF TRANSACTION ACCOUNTS.

(a) Banks and Savings Associations.-- (1) Amendments.--Section 11(a)(1) of the Federal Deposit Insurance Act (12 U.S.C. 1821(a)(1)) is amended-- (A) in subparagraph (B)-- (i) by striking “The net amount” and inserting the following:
“(i) In general.--Subject to clause (ii), the net amount”; and (ii) by adding at the end the following new clauses:
“(ii) Insurance for noninterest-bearing transaction accounts.--Notwithstanding clause (i), the Corporation shall fully insure the net amount that any depositor at an insured depository institution maintains in a noninterest-bearing transaction account. Such amount shall not be taken into account when computing the net amount due to such depositor under clause (i). “(iii) Noninterest-bearing transaction account defined.--For purposes of this subparagraph, the term `noninterest-bearing transaction account' means a deposit or account maintained at an insured depository institution-- “(I) with respect to which interest is neither accrued nor paid; “(II) on which the depositor or account holder is permitted to make withdrawals by negotiable or transferable instrument, payment orders of withdrawal, telephone or other electronic media transfers, or other similar items for the purpose of making payments or transfers to third parties or others; and “(III) on which the insured depository institution does not reserve the right to require advance notice of an intended withdrawal.”; and (B) in subparagraph (C), by striking “subparagraph (B)” and inserting “subparagraph (B)(i)”. (2) Effective date.--The amendments made by paragraph (1) shall take effect on December 31, 2010. (3) Prospective repeal.--Effective January 1, 2013, section 11(a)(1) of the Federal Deposit Insurance Act (12 U.S.C. 1821(a)(1)), as amended by paragraph (1), is amended-- (A) in subparagraph (B)-- (i) by striking “deposit.--” and all that follows through “clause (ii), the net amount” and insert “deposit.--The net amount”; and

(ii) by striking clauses (ii) and (iii); and (B) in subparagraph (C), by striking “subparagraph (B)(i)” and inserting “subparagraph (B)”.

(b) Credit Unions.--
(1) Amendments.--Section 207(k)(1) of the Federal Credit Union Act (12 U.S.C. 1787(k)(1)) is amended-- (A) in subparagraph (A)-- (i) by striking “Subject to the provisions of paragraph (2), the net amount” and inserting the following:
“(i) Net amount of insurance payable.-- Subject to clause (ii) and the provisions of paragraph (2), the net amount”; and (ii) by adding at the end the following new clauses:
“(ii) Insurance for noninterest-bearing transaction accounts.--Notwithstanding clause (i), the Board shall fully insure the net amount that any member or depositor at an insured credit union maintains in a noninterest-bearing transaction account. Such amount shall not be taken into account when computing the net amount due to such member or depositor under clause (i). “(iii) Noninterest-bearing transaction account defined.--For purposes of this subparagraph, the term `noninterest-bearing transaction account' means an account or deposit maintained at an insured credit union-- “(I) with respect to which interest is neither accrued nor paid; “(II) on which the account holder or depositor is permitted to make withdrawals by negotiable or transferable instrument, payment orders of withdrawal, telephone or other electronic media transfers, or other similar items for the purpose of making payments or transfers to third parties or others; and “(III) on which the insured credit union does not reserve the right to require advance notice of an intended withdrawal.”; and (B) in subparagraph (B), by striking “subparagraph (A)” and inserting “subparagraph (A)(i)”. (2) Effective date.--The amendments made by paragraph (1) shall take effect upon the date of the enactment of this Act (3) Prospective repeal.--Effective January 1, 2013, section 207(k)(1) of the Federal Credit Union Act (12 U.S.C. 1787(k)(1)), as amended by paragraph (1), is amended-- (A) in subparagraph (A)-- (i) by striking “(i) net amount of insurance payable.--” and all that follows through “paragraph (2), the net amount” and inserting “Subject to the provisions of paragraph (2), the net amount”; and (ii) by striking clauses (ii) and (iii); and (B) in subparagraph (B), by striking “subparagraph (A)(i)” and inserting “subparagraph (A)”.

Subtitle E--Technical and Conforming Amendments

SEC. 351. EFFECTIVE DATE.

Except as provided in section 364(a), the amendments made by this subtitle shall take effect on the transfer date. SEC. 352. BALANCED BUDGET AND EMERGENCY DEFICIT CONTROL ACT OF 1985.

Section 256(h) of the Balanced Budget and Emergency Deficit Control
Act of 1985 (2 U.S.C. 906(h)) is amended-- (1) in paragraph (4), by striking subparagraphs (C) and (G); and (2) by redesignating subparagraphs (D), (E), (F), and (H) as subparagraphs (C), (D), (E), and (F), respectively. SEC. 353. BANK ENTERPRISE ACT OF 1991.

Section 232(a) of the Bank Enterprise Act of 1991 (12 U.S.C.
1834(a)) is amended--
(1) in the subsection heading, by striking “by Federal Reserve Board”; (2) in paragraph (1)-- (A) by striking “The Board of Governors of the Federal Reserve System,” and inserting “The Comptroller of the Currency”; and (B) by striking “section 7(b)(2)(H)” and inserting “section 7(b)(2)(E)”; (3) in paragraph (2)(A), by striking “Board” and inserting “Comptroller”; and (4) in paragraph (3)-- (A) by redesignating subparagraphs (A) through (C) as subparagraphs (B) through (D), respectively; and (B) by inserting before subparagraph (B) the following:
“(A) Comptroller.--The term
`Comptroller' means the Comptroller of the Currency.”. SEC. 354. BANK HOLDING COMPANY ACT OF 1956.

The Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.) is amended-- (1) in section 2(j)(3) (12 U.S.C. 1841(j)(3)), strike “Director of the Office of Thrift Supervision” and inserting “appropriate Federal banking agency”; (2) in section 4 (12 U.S.C. 1843)-- (A) in subsection (i)-- (i) in paragraph (4)-- (I) in subparagraph (A)-- (aa) in the subparagraph heading, by striking “to director”; and (bb) by striking “Board” and all that follows through the end of the subparagraph and inserting “Board shall solicit comments and recommendations from-- “(i) the Comptroller of the Currency, with respect to the acquisition of a Federal savings association; and

“(ii) the Federal Deposit Insurance Corporation, with respect to the acquisition of a State savings association.”. (II) in subparagraph (B), by striking “Director” each place that term appears and inserting “Comptroller of the Currency or the Federal Deposit Insurance Corporation, as applicable,”; (ii) in paragraph (5)-- (I) in subparagraph (B), by striking “Director with” and inserting “Comptroller of the Currency or the Federal Deposit Insurance Corporation, as applicable, with”; and (II) by striking “Director” each place that term appears and inserting “Comptroller of the Currency or the Federal Deposit Insurance Corporation”; (iii) in paragraph (6), by striking “Director” and inserting “Comptroller of the Currency or the Federal Deposit Insurance Corporation, as applicable,”; and (iv) by striking paragraph (7); and (3) in section 5(f) (12 U.S.C. 1844(f))-- (A) by striking “subpena” each place that term appears and inserting “subpoena”; (B) by striking “subpenas” each place that term appears and inserting “subpoenas”; and (C) by striking “subpenaed” and inserting “subpoenaed”. SEC. 355. BANK HOLDING COMPANY ACT AMENDMENTS OF 1970.

Section 106(b)(1) of the Bank Holding Company Act Amendments of 1970
(12 U.S.C. 1972(1)) is amended in the undesignated matter following subparagraph (E) by inserting “issue such regulations as are necessary to carry out this section, and, in consultation with the Comptroller of the Currency and the Federal Deposit Insurance Company, may” after “The Board may”. SEC. 356. BANK PROTECTION ACT OF 1968.

The Bank Protection Act of 1968 (12 U.S.C. 1881 et seq.) is amended-- (1) in section 2 (12 U.S.C. 1881), by striking “the term” and all that follows through the end of the section and inserting “the term `Federal supervisory agency' means the appropriate Federal banking agency, as defined in section 3(q) of the Federal Deposit Insurance Act (12 U.S.C. 1813(q)).”; (2) in section 3 (12 U.S.C. 1882), by striking “and loan” each place that term appears; and (3) in section 5 (12 U.S.C. 1884), by striking “and loan”. SEC. 357. BANK SERVICE COMPANY ACT.

The Bank Service Company Act (12 U.S.C. 1861 et seq.) is amended-- (1) in section 1(b)(4) (12 U.S.C. 1861(b)(4))-- (A) by inserting after “an insured bank,” the following: “a savings association,”; (B) by striking “Director of the Office of Thrift Supervision” and inserting “appropriate Federal banking agency”; and

(C) by striking “, the Federal Savings and Loan Insurance Corporation,”; (2) in section 1(b)(5), by striking “term insured depository institution' has the same meaning as in section 3(c)” and inserting “terms depository institution' and `savings association' have the same meanings as in section 3”; and (3) in section 7(c)(2) (12 U.S.C. 1867(c)(2)), by inserting “each” after “notify”. SEC. 358. COMMUNITY REINVESTMENT ACT OF 1977.

The Community Reinvestment Act of 1977 (12 U.S.C. 2901 et seq.) is amended-- (1) in section 803 (12 U.S.C. 2902)-- (A) in paragraph (1)-- (i) in subparagraph (A), by inserting “and Federal savings associations (the deposits of which are insured by the Federal Deposit Insurance Corporation)” after “banks”; (ii) in subparagraph (B), by striking “and bank holding companies” and inserting “, bank holding companies, and savings and loan holding companies”; and (iii) in subparagraph (C), by striking “; and” and inserting “, and State savings associations (the deposits of which are insured by the Federal Deposit Insurance Corporation).”; and (B) by striking paragraph (2) (relating to the Office of Thrift Supervision), as added by section 744(q) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (Public Law 101-73; 103 Stat. 440); and (2) in section 806 (12 U.S.C. 2905), by inserting “, except that the Comptroller of the Currency shall prescribe regulations applicable to savings associations and the Board of Governors shall prescribe regulations applicable to insured State member banks, bank holding companies and savings and loan holding companies,” after “supervisory agency”. SEC. 359. CRIME CONTROL ACT OF 1990.

The Crime Control Act of 1990 is amended-- (1) in section 2539(c)(2) (28 U.S.C. 509 note)-- (A) by striking subparagraphs (C) and (D); and (B) by redesignating subparagraphs (E) through (H) as subparagraphs (C) through (G), respectively; and (2) in section 2554(b)(2) (Public Law 101-647; 104 Stat. 4890)-- (A) in subparagraph (A), by striking “, the Director of the Office of Thrift Supervision,” and inserting “the Comptroller of the Currency”; and (B) in subparagraph (B), by striking “, the Director” and all that follows through “Trust Corporation” and inserting “or the Federal Deposit Insurance Corporation”. SEC. 360. DEPOSITORY INSTITUTION MANAGEMENT INTERLOCKS ACT.

The Depository Institution Management Interlocks Act (12 U.S.C. 3201 et seq.) is amended-- (1) in section 207 (12 U.S.C. 3206)-- (A) in paragraph (1), by inserting before the comma at the end the following: “and Federal savings associations

(the deposits of which are insured by the Federal Deposit Insurance Corporation)”; (B) in paragraph (2), by striking “, and bank holding companies” and inserting “, bank holding companies, and savings and loan holding companies”; (C) in paragraph (3), by striking “Corporation,” and inserting “Corporation and State savings associations (the deposits of which are insured by the Federal Deposit Insurance Corporation),”; (D) by striking paragraph (4); (E) by redesignating paragraphs (5) and (6) as paragraphs (4) and (5), respectively; and (F) in paragraph (5), as so redesignated, by striking “through (5)” and inserting “through (4)”; (2) in section 209 (12 U.S.C. 3207)-- (A) in paragraph (1), by inserting before the comma at the end the following: “and Federal savings associations (the deposits of which are insured by the Federal Deposit Insurance Corporation)”; (B) in paragraph (2), by striking “, and bank holding companies” and inserting “, bank holding companies, and savings and loan holding companies”; (C) in paragraph (3), by striking “Corporation,” and inserting “Corporation and State savings associations (the deposits of which are insured by the Federal Deposit Insurance Corporation),”; (D) by striking paragraph (4); and (E) by redesignating paragraph (5) as paragraph (4); and (3) in section 210(a) (12 U.S.C. 3208(a))-- (A) by striking “his” and inserting “the”; and (B) by inserting “of the Attorney General” after “enforcement functions”. SEC. 361. EMERGENCY HOMEOWNERS' RELIEF ACT.

Section 110 of the Emergency Homeowners' Relief Act (12 U.S.C. 2709)
is amended in the second sentence, by striking “Home Loan Bank Board, the Federal Savings and Loan Insurance Corporation” and inserting “Housing Finance Agency”. SEC. 362. FEDERAL CREDIT UNION ACT.

The Federal Credit Union Act (12 U.S.C. 1751 et seq.) is amended-- (1) in section 107(8) (12 U.S.C. 1757(8)), by striking “or the Federal Savings and Loan Insurance Corporation”; (2) in section 205 (12 U.S.C. 1785)-- (A) in subsection (b)(2)(G)(i), by striking “the Office of Thrift Supervision and”; and (B) in subsection (i)(1), by striking “or the Federal Savings and Loan Insurance Corporation”; and (3) in section 206(g)(7) (12 U.S.C. 1786(g)(7))-- (A) in subparagraph (A)-- (i) in clause (ii), by striking “(b)(8)” and inserting “(b)(9)”; (ii) in clause (v)-- (I) by striking “depository” and inserting “financial”; and (II) by adding “and” at the end;

(iii) in clause (vi)--
(I) by striking “Board” and inserting “Agency”; and (II) by striking “; and” and inserting a period; and (iv) by striking clause (vii); and (B) in subparagraph (D)-- (i) in clause (iii), by adding “and” at the end; (ii) in clause (iv)-- (I) by striking “Board” and inserting “Agency”; and (II) by striking “and” at the end; and (iii) by striking clause (v). SEC. 363. FEDERAL DEPOSIT INSURANCE ACT.

The Federal Deposit Insurance Act (12 U.S.C. 1811 et seq.) is amended-- (1) in section 3 (12 U.S.C. 1813)-- (A) in subsection (b)(1)(C), by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency”; (B) in subsection (l)(5), in the matter preceding subparagraph (A), by striking “Director of the Office of Thrift Supervision,”; and (C) in subsection (z), by striking “the Director of the Office of Thrift Supervision,”; (2) in section 7 (12 U.S.C. 1817)-- (A) in subsection (a)-- (i) in paragraph (2)-- (I) in subparagraph (A)-- (aa) in the first sentence, by striking “the Director of the Office of Thrift Supervision,”; (bb) in the second sentence-- (AA) by striking “the Director of the Office of Thrift Supervision,” and inserting “to”; and (BB) by inserting “to” before “any Federal home”; and (cc) by striking “Finance Board” each place that term appears and inserting “Finance Agency”; and (II) in subparagraph (B), by striking “the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, and the Director of the Office of Thrift Supervision,” and inserting “the Comptroller of the Currency and the Board of Governors of the Federal Reserve System,”; (ii) in paragraph (3), in the first sentence, by striking “Comptroller of the Currency, the Chairman of the Board of Governors of the Federal Reserve System, and the Director of the Office of Thrift Supervision.” and inserting “Comptroller of the Currency, and the Chairman of the Board of Governors of the Federal Reserve System.”; (iii) in paragraph (6), by striking “section 232(a)(3)(C)” and inserting “section 232(a)(3)(D)”; and

(iv) in paragraph (7), by striking “, the Director of the Office of Thrift Supervision,”; and (B) in subsection (n)-- (i) in the heading, by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency”; (ii) in the first sentence-- (I) by striking “the Director of the Office of Thrift Supervision” and inserting “the Comptroller of the Currency”; and (II) by inserting “Federal” before “savings associations”; (iii) in the third sentence, by striking “, the Financing Corporation, and the Resolution Funding Corporation”; and (iv) by striking “the Director” each place that term appears and inserting “the Comptroller”; (3) in section 8 (12 U.S.C. 1818)-- (A) in subsection (a)(8)(B)(ii), in the last sentence, by striking “Director of the Office of Thrift Supervision” each place that term appears and inserting “Comptroller of the Currency”; (B) in subsection (b)(3)-- (i) by inserting “any savings and loan holding company and any subsidiary (other than a depository institution) of a savings and loan holding company (as such terms are defined in
section 10 of Home Owners' Loan Act)), any
noninsured State member bank” after “Bank Holding Company Act of 1956,”; and (ii) by inserting “or against a savings and loan holding company or any subsidiary thereof (other than a depository institution or a subsidiary of such depository institution)” before the period at the end; (C) by striking paragraph (9) of subsection (b) and inserting the following new paragraph:
“(9) [Repealed]”.
(D) in subsection (e)(7)--
(i) in subparagraph (A)--
(I) in clause (v), by inserting
“and” after the semicolon;
(II) in clause (vi)--
(aa) by striking “Board” and inserting “Agency”; and (bb) by striking “; and” and inserting a period; and (III) by striking clause (vii); and (ii) in subparagraph (D)-- (I) in clause (iii), by inserting “and” after the semicolon; (II) in clause (iv)-- (aa) by striking “Board” and inserting “Agency”; and (bb) by striking “; and” and inserting a period; and (III) by striking clause (v); (E) in subsection (j)--

(i) in paragraph (2), by striking “, or as a savings association under subsection (b)(9) of this section”; (ii) in paragraph (3), by inserting “or” after the semicolon; (iii) in paragraph (4), by striking “; or” and inserting a comma; and (iv) by striking paragraph (5); (F) in subsection (o), by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency”; and (G) in subsection (w)(3)(A), by striking “and the Office of Thrift Supervision”; (4) in section 10 (12 U.S.C. 1820)-- (A) in subsection (d)(5), by striking “or the Resolution Trust Corporation” each place that term appears; and (B) in subsection (k)(5)(B)-- (i) in clause (ii), by inserting “and” after the semicolon; (ii) in clause (iii), by striking “; and” and inserting a period; and (iii) by striking clause (iv); (5) in section 11 (12 U.S.C. 1821)-- (A) in subsection (c)-- (i) in paragraph (2)(A)(ii), by striking “(other than section 21A of the Federal Home Loan Bank Act)”; (ii) in paragraph (4), by striking “Except as otherwise provided in section 21A of the Federal Home Loan Bank Act and notwithstanding” and inserting “Notwithstanding”; (iii) in paragraph (6)-- (I) in the heading, by striking “Director of the office of thrift supervision” and inserting “Comptroller of the currency”; (II) in subparagraph (A)-- (aa) by striking “or the Resolution Trust Corporation”; and (bb) by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency”; and (III) by amending subparagraph (B) to read as follows:
“(B) Receiver.--The Corporation may, at the discretion of the Comptroller of the Currency, be appointed receiver and the Corporation may accept any such appointment.”; (iv) in paragraph (12)(A), by striking “or the Resolution Trust Corporation”; (B) in subsection (d)-- (i) in paragraph (17)(A), by striking “or the Director of the Office of Thrift Supervision”; and (ii) in paragraph (18)(B), by striking “or the Director of the Office of Thrift Supervision”; (C) in subsection (m)-- (i) in paragraph (9), by striking “or the Director of the Office of Thrift Supervision, as appropriate”;

(ii) in paragraph (16), by striking “or the Director of the Office of Thrift Supervision, as appropriate” each place that term appears; and (iii) in paragraph (18), by striking “or the Director of the Office of Thrift Supervision, as appropriate” each place that term appears; (D) in subsection (n)-- (i) in paragraph (1)(A)-- (I) by striking “, or the Director of the Office of Thrift Supervision, with respect to” and inserting “or”; and (II) by striking “applicable,,” and inserting “applicable,”; (ii) in paragraph (2)(A), by striking “or the Director of the Office of Thrift Supervision”; (iii) in paragraph (4)(D), by striking “and the Director of the Office of Thrift Supervision, as appropriate,”; (iv) in paragraph (4)(G), by striking “and the Director of the Office of Thrift Supervision, as appropriate,”; and (v) in paragraph (12)(B)-- (I) by inserting “as” after “shall appoint the Corporation”; (II) by striking “or the Director of the Office of Thrift Supervision, as appropriate,” each place such term appears; (E) in subsection (p)-- (i) in paragraph (2)(B), by striking “the Corporation, the FSLIC Resolution Fund, or the Resolution Trust Corporation,” and inserting “or the Corporation,”; and (ii) in paragraph (3)(B), by striking “, the FSLIC Resolution Fund, the Resolution Trust Corporation,”; and (F) in subsection (r), by striking “and the Resolution Trust Corporation”; (6) in section 13(k)(1)(A)(iv) (12 U.S.C. 1823(k)(1)(A)(iv)), by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency”; (7) in section 18 (12 U.S.C. 1828)-- (A) in subsection (c)(2)-- (i) in subparagraph (A), by inserting “or a Federal savings association” before the semicolon; (ii) in subparagraph (B), by adding “and” at the end; (iii) in subparagraph (C), by striking “(except” and all that follows through “; and” and inserting “or a State savings association.”; and (iv) by striking subparagraph (D); (B) in subsection (g)(1), by striking “the Director of the Office of Thrift Supervision”and inserting “the Comptroller of the Currency”; (C) in subsection (i)(2)(C), by striking “Director of the Office of Thrift Supervision” and inserting “Corporation”; and (D) in subsection (m)--

(i) in paragraph (1)--
(I) in subparagraph (A), by striking “and the Director of the Office of Thrift Supervision” and inserting “or the Comptroller of the Currency, as appropriate,”; and (II) in subparagraph (B), by striking “and orders of the Director of the Office of Thrift Supervision” and inserting “of the Comptroller of the Currency and orders of the Corporation and the Comptroller of the Currency”; (ii) in paragraph (2)-- (I) in subparagraph (A), by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency, as appropriate,”; and (II) in subparagraph (B)-- (aa) in the matter before clause (i), by striking “Director of the Office of Thrift Supervision” and inserting “Corporation or the Comptroller of the Currency, as appropriate,”; and (bb) in the matter following clause (ii)-- (AA) in the first sentence, by striking “Director of the Office of Thrift Supervision” and inserting “Office of the Comptroller of the Currency, as appropriate,”; and (BB) by striking the second sentence and inserting the following:
“The Corporation or the
Comptroller of the Currency, as appropriate, may take any other corrective measures with respect to the subsidiary, including the authority to require the subsidiary to terminate the activities or operations posing such risks, as the Corporation or the Comptroller of the Currency, respectively, may deem appropriate.”; and (iii) in paragraph (3)-- (I) in subparagraph (A), in the second sentence-- (aa) by inserting “, in the case of a Federal savings association,” before “consult with”; and (bb) by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency”; and (II) in subparagraph (B)-- (aa) in the subparagraph heading, by striking “Director” and inserting “Comptroller of the currency”; (bb) by striking “Office of Thrift Supervision” and inserting “Comptroller of the Currency”; (cc) by inserting a comma after “soundness”; and (dd) by inserting “as to Federal savings associations” after “compliance”; (8) in section 19(e) (12 U.S.C. 1829(e))--

(A) in paragraph (1), by striking “Director of the Office of Thrift Supervision” and inserting “Board of Governors of the Federal Reserve System”; and (B) in paragraph (2), by striking “Director of the Office of Thrift Supervision” and inserting “Board of Governors of the Federal Reserve System”; (9) in section 28 (12 U.S.C. 1831e)-- (A) in subsection (e)-- (i) in paragraph (2)-- (I) in subparagraph (A)(ii), by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency or the Corporation, as appropriate”; (II) in subparagraph (C), by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency or the Corporation, as appropriate,”; and (III) in subparagraph (F), by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency or the Corporation, as appropriate”; and (ii) in paragraph (3)-- (I) in subparagraph (A), by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency or the Corporation, as appropriate”; and (II) in subparagraph (B), by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency or the Corporation, as appropriate,”; and (B) in subsection (h)(2), by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency, of the Corporation,”; and (10) in section 33(e) (12 U.S.C. 1831j(e)), by striking “Federal Housing Finance Board, the Comptroller of the Currency, and the Director of the Office of Thrift Supervision” and inserting “Federal Housing Finance Agency and the Comptroller of the Currency”. SEC. 364. FEDERAL HOME LOAN BANK ACT.

(a) Repeal of Section
18(c).--Effective 90 days after the transfer date, section 18(c) of the Federal Home Loan Bank Act (12 U.S.C. 1438(c)) is repealed.

(b) Repeal of Section 21A.--Section 21A of the Federal Home Loan Bank Act (12 U.S.C. 1441a) is repealed. SEC. 365. FEDERAL HOUSING ENTERPRISES FINANCIAL SAFETY AND SOUNDNESS ACT OF 1992.

The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4501 et seq.) is amended-- (1) in section 1315(b) (12 U.S.C. 4515(b)), by striking “the Federal Deposit Insurance Corporation, and the Office of Thrift Supervision.” and inserting “and the Federal Deposit Insurance Corporation.”; and (2) in section 1317(c) (12 U.S.C. 4517(c)), by striking “the Federal Deposit Insurance Corporation, or the Director of the Office of Thrift Supervision” and inserting “or the Federal Deposit Insurance Corporation”.

SEC. 366. FEDERAL RESERVE ACT.

The Federal Reserve Act (12 U.S.C. 221 et seq.) is amended-- (1) in section 11(a)(2) (12 U.S.C. 248(a)(2))-- (A) by inserting “State savings associations that are insured depository institutions (as defined in
section 3 of the Federal Deposit Insurance Act),” after
“case of insured”;
(B) by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency”; (C) by inserting “Federal” before “savings association which”; and (D) by striking “savings and loan association” and inserting “savings association”; and (2) in section 19(b) (12 U.S.C. 461(b))-- (A) in paragraph (1)(F), by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency”; and (B) in paragraph (4)(B), by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency”. SEC. 367. FINANCIAL INSTITUTIONS REFORM, RECOVERY, AND ENFORCEMENT ACT OF 1989.

The Financial Institutions Reform, Recovery, and Enforcement Act of 1989 is amended-- (1) in section 203 (12 U.S.C. 1812 note), by striking subsection (b); (2) in section 302(1) (12 U.S.C. 1467a note), by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency”; (3) in section 305(12 U.S.C. 1464 note), by striking subsection (b); (4) in section 308 (12 U.S.C. 1463 note)-- (A) in subsection (a), by striking “Director of the Office of Thrift Supervision” and inserting “Chairman of the Board of Governors of the Federal Reserve System, the Comptroller of the Currency, the Chairman of the National Credit Union Administration,”; and (B) by adding at the end the following new subsection:

“(c) Reports.--The Secretary of the Treasury, the Chairman of the Board of Governors of the Federal Reserve System, the Comptroller of the Currency, the Chairman of the National Credit Union Administration, and the Chairperson of Board of Directors of the Federal Deposit Insurance Corporation shall each submit an annual report to the Congress containing a description of actions taken to carry out this section.”; (5) in section 402 (12 U.S.C. 1437 note)-- (A) in subsection (a), by striking “Director of the Office of Thrift Supervision” and inserting “Comptroller of the Currency”; (B) by striking subsection (b); (C) in subsection (e)-- (i) in paragraph (1), by striking “Office of Thrift Supervision” and inserting “Comptroller of the Currency”; and (ii) in each of paragraphs (2), (3), and (4), by striking “Director of the Office of Thrift Supervision”

each place that term appears and inserting “Comptroller of the Currency”; and (D) by striking “Federal Housing Finance Board” each place that term appears and inserting “Federal Housing Finance Agency”; (6) in section 1103(a) (12 U.S.C. 3332(a)), by striking “and the Resolution Trust Corporation”; (7) in section 1205(b) (12 U.S.C. 1818 note)-- (A) in paragraph (1)-- (i) by striking subparagraph (B); and (ii) by redesignating subparagraphs (C) through (F) as subparagraphs (B) through (E), respectively; and (B) in paragraph (2), by striking “paragraph (1)(F)” and inserting “paragraph (1)(E)”; (8) in section 1206 (12 U.S.C. 1833b)-- (A) by striking “Board, the Oversight Board of the Resolution Trust Corporation” and inserting “Agency, and”; and (B) by striking “, and the Office of Thrift Supervision”; (9) in section 1216 (12 U.S.C. 1833e)-- (A) in subsection (a)-- (i) in paragraph (3), by adding “and” at the end; (ii) in paragraph (4), by striking the semicolon at the end and inserting a period; (iii) by striking paragraphs (2), (5), and (6); and (iv) by redesignating paragraphs (3) and (4), as paragraphs (2) and (3), respectively; (B) in subsection (c)-- (i) by striking “the Director of the Office of Thrift Supervision,” and inserting “and”; and (ii) by striking “the Thrift Depositor Protection Oversight Board of the Resolution Trust Corporation, and the Resolution Trust Corporation”; and (C) in subsection (d)-- (i) by striking paragraphs (3), (5), and (6); and (ii) by redesignating paragraphs (4), (7), and (8) as paragraphs (3), (4), and (5), respectively. SEC. 368. FLOOD DISASTER PROTECTION ACT OF 1973.

Section 3(a)(5) of the Flood Disaster Protection Act of 1973 (42
U.S.C. 4003(a)(5)) is amended by striking “, the Office of Thrift Supervision”. SEC. 369. HOME OWNERS' LOAN ACT.

The Home Owners' Loan Act (12 U.S.C. 1461 et seq.) is amended-- (1) in section 1 (12 U.S.C. 1461), by striking the table of contents; (2) in section 2 (12 U.S.C. 1462), as amended by this Act-- (A) by striking paragraphs (1) and (3); (B) by redesignating paragraph (2) as paragraph (1); (C) by redesignating paragraphs (4) through (9) as paragraphs (2) through (7), respectively; and (D) by adding at the end the following:

“(8) Board.--The term Board', other than in the context of the Board of Directors of the Corporation, means the Board of Governors of the Federal Reserve System. “(9) Comptroller.--The term Comptroller' means the Comptroller of the Currency.”; (3) in section 3 (12 U.S.C. 1462a)-- (A) by striking the section heading and inserting the following:
“SEC. 3. ADMINISTRATIVE PROVISIONS.”; (B) by striking subsections (a), (b), (c), (d), (g), (h), (i), and (j); (C) by redesignating subsections (e) and (f) as subsections (a) and (b), respectively; (D) in subsection (a), as so redesignated-- (i) in the heading by striking “of the Director”; and (ii) in the matter preceding paragraph (1), by striking “The Director” and inserting “In accordance with subtitle A of title III of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the appropriate Federal banking agency”; and (E) in subsection (b), as so redesignated, by striking “Director” and inserting “appropriate Federal banking agency”; (4) in section 4 (12 U.S.C. 1463)-- (A) in subsection (a)-- (i) in the subsection heading, by striking “Federal”; (ii) by striking paragraphs (1) and (2) and inserting the following:
“(1) Examination and safe and sound operation.-- “(A) Federal savings associations.--The Comptroller shall provide for the examination and safe and sound operation of Federal savings associations. “(B) State savings associations.--The Corporation shall provide for the examination and safe and sound operation of State savings associations. “(2) Regulations for savings associations.--The Comptroller may prescribe regulations with respect to savings associations, as the Comptroller determines to be appropriate to carry out the purposes of this Act.”; and (iii) in paragraph (3), by striking “Director” each place that term appears and inserting “Comptroller and the Corporation”; (B) in subsection (b)-- (i) in paragraph (2)-- (I) in subparagraph (A), by adding “and” at the end; (II) in subparagraph (B), by striking “; and” and inserting a period; and (III) by striking subparagraph (C); and (ii) by striking “Director” each place that term appears and inserting “Comptroller”; (C) in subsection (c)--

(i) by striking “All regulations and policies of the Director” and inserting “The regulations of the Comptroller and the policies of the Comptroller and the Corporation”; and (ii) by striking “of the Currency”; (D) in subsection (e)(5), by striking “Director” and inserting “Comptroller”; (E) in subsection (f), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; and (F) in subsection (h), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (5) in section 5 (12 U.S.C. 1464)-- (A) in subsection (a), by striking “Director”, each place such term appears and inserting “Comptroller of the Currency”; (B) in subsection (b), by striking “Director”, each place such term appears and inserting “Comptroller of the Currency”; (C) in subsection (c)-- (i) in paragraph (5)-- (I) in subparagraph (A), by striking “Director” and inserting “appropriate Federal banking agency”; and (II) in subparagraph (B)-- (aa) by striking “The Director” and inserting “The appropriate Federal banking agency”; and (bb) by striking “the Director” and inserting “the appropriate Federal banking agency”; (D) in subsection (d)-- (i) in paragraph (1)-- (I) in subparagraph (A)-- (aa) in the first sentence, by striking “Director” and inserting “appropriate Federal banking agency”; (bb) in the second sentence-- (AA) by striking “Director's own name and through the Director's own attorneys” and inserting “name of the appropriate Federal banking agency and through the attorneys of the appropriate Federal banking agency”; and (BB) by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; and (cc) in the third sentence, by striking “Director” each place that term appears and inserting “Comptroller”; (II) in subparagraph (B)-- (aa) in clauses (i) through (iv), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (III) in clause (v)--

(aa) in the matter preceding subclause (I), by striking “Director” and inserting “appropriate Federal banking agency”; (bb) in subclause (II), by striking “subpenas” and inserting “subpoenas”; and (cc) in the matter following subclause (II), by striking “subpena” and inserting “subpoena”; (IV) in clause (vi)-- (aa) in the first sentence, by striking “Director” and inserting “appropriate Federal banking agency”; and (bb) in the second sentence, by striking “Director” and inserting “Comptroller”; (V) in clause (vii)-- (aa) in the first sentence, by striking “subpena” and inserting “subpoena”; (bb) in the second sentence, by striking “subpenaed” and inserting “subpoenaed”; and (cc) in the third sentence, by striking “Director” and inserting “appropriate Federal banking agency”; (ii) in paragraph (2)-- (I) in subparagraph (A)-- (aa) by striking “Director of the Office of Thrift Supervision” and inserting “appropriate Federal banking agency”; (bb) by striking “any insured savings association” and inserting “an insured savings association”; and (cc) by striking “Director determines, in the Director's discretion” and inserting “appropriate Federal banking agency determines, in the discretion of the appropriate Federal banking agency”; (II) in subparagraph (B), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (III) in subparagraphs (C) and (D), by striking “Director” and inserting “appropriate Federal banking agency”; (IV) in subparagraph (E)-- (aa) in clause (ii)-- (AA) in the clause heading, by striking “or rtc”; and (BB) by striking “or the Resolution Trust Corporation, as appropriate,” each place that term appears; and (bb) by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; and (iii) in paragraph (3)-- (I) in subparagraph (A), by striking “Director” each place that term appears and inserting “Comptroller”; and (II) in subparagraph (B)--

(aa) in the subparagraph heading, by striking “or rtc”; (bb) by striking “Corporation or the Resolution Trust”; and (cc) by striking “Director” and inserting “Comptroller”; (iv) in paragraph (4), by striking “Director” and inserting “appropriate Federal banking agency”; (v) in paragraph (6)-- (I) in subparagraph (A), by striking “Director” and inserting “Comptroller”; and (II) in subparagraphs (B) and (C), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (vi) in paragraph (7)-- (I) in subparagraphs (A), (B), and (D), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (II) in subparagraph (C), by striking “Director” and inserting “Federal Deposit Insurance Corporation or the Comptroller, as appropriate,”; and (III) by striking subparagraph (E) and inserting the following:
“(E) Administration by the comptroller and the corporation.--The Comptroller may issue such regulations, and the appropriate Federal banking agency may issue such orders, including those issued pursuant to section 8 of the Federal Deposit Insurance Act, as may be necessary to administer and carry out this paragraph and to prevent evasion of this paragraph.”; (E) in subsection (e)(2), strike “Director” and insert “Comptroller”; (F) in subsection (i)-- (i) by striking “Director”, each place such term appears, and inserting “Comptroller”; (ii) in paragraph (2), in the heading, by striking “director” and inserting “Comptroller”; (iii) in paragraph (5)(A), by striking “of the Currency”; and (iv) except as provided in clauses (i) through (iii), by striking “Director” each place such term appears and inserting “Comptroller”; (G) in subsection (o)-- (i) in paragraph (1), by striking “Director” and inserting “Comptroller”; and (ii) in paragraph (2)(B), by striking “Director's determination” and inserting “determination of the Comptroller”; (H) in subsections (m), (n), (o), and (p), by striking “Director”, each place such term appears, and inserting “Comptroller”; (I) in subsection (q)-- (i) in paragraph (6), by striking “of Governors of the Federal Reserve System”; (ii) by striking “Director” each place that term appears and inserting “Board”; and

(iii) by inserting “in consultation with the Comptroller and the Corporation,” before “considers”; (J) in subsection (r)(3), by striking “Director” and inserting “Comptroller of the Currency”; (K) in subsection (s)-- (i) in paragraph (1), strike “Director” and insert “Comptroller of the Currency”; (ii) in paragraph (2), strike “Director” and insert “Comptroller of the Currency”; (iii) in paragraph (3), by striking “Director's discretion, the Director” and inserting “discretion of the appropriate Federal banking agency, the appropriate Federal banking agency,”; (iv) in paragraph (4), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; and (v) in paragraph (5)-- (I) by striking “Director”, each place such term appears, and inserting “appropriate Federal banking agency”; and (II) by striking “Director's approval” and inserting “approval of the appropriate Federal banking agency”; (L) in subsection (t)-- (i) in paragraph (1), by striking subparagraph (D); (ii) by striking paragraph (3) and inserting the following:
“(3) [Repealed].”;
(iii) in paragraph (5)--
(I) in subparagraph (B), by striking “Corporation, in its sole discretion” and inserting “appropriate Federal banking agency, in the sole discretion of the appropriate Federal banking agency”; and (II) by striking subparagraph (D); (iv) in paragraph (6)-- (I) by striking subparagraph (A) and inserting the following:
“(A) [Reserved].”;
(II) in subparagraph (B), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (III) in subparagraph (C)-- (aa) in clause (i), by striking “Director's prior approval” and inserting “prior approval of the appropriate Federal banking agency”; (bb) in clause (ii), by striking “Director's discretion” and inserting “discretion of the appropriate Federal banking agency”; and (cc) by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (IV) in subparagraph (E), by striking “Director shall” and inserting “appropriate Federal banking agency may”; and (V) in subparagraph (F), by striking “Director” and all that follows through the end of the

subparagraph and inserting “appropriate Federal banking agency under this Act or any other provision of law.”; (v) in paragraph (7), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (vi) by striking paragraph (8) and inserting the following:
“(8) [Repealed].”;
(vii) in paragraph (9)--
(I) in subparagraph (A), by striking “Director” and inserting “Comptroller”; (II) in subparagraph (C), by striking “of the Currency”; and (III) by striking subparagraph (B) and redesignating subparagraphs (C) and (D) as subparagraphs (B) and (C), respectively; and (viii) except as provided in clauses (i) through (vii), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (M) in subsection (u), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (N) in subsection (v)-- (i) in paragraph (2), by striking “Director's determinations” and inserting “determinations of the appropriate Federal banking agency”; and (ii) by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (O) in subsection (w)(1)-- (i) in subparagraph (A)(II), by striking “Director's intention” and inserting “intention of the Comptroller”; and (ii) in subparagraph (B), by striking “Director's intention” and inserting “intention of the Comptroller”; and (P) except as provided in subparagraphs (A) through (J), by striking “Director” each place that term appears and inserting “Comptroller”; (6) in section 8 (12 U.S.C. 1466a), by striking “Director” each place that term appears and inserting “Comptroller”; (7) in section 9 (12 U.S.C. 1467)-- (A) in subsection (a), by striking “assessed by the Director” and all that follows through the end of the subsection and inserting the following: “assessed by-- “(1) the Comptroller, against each such Federal savings association, as the Comptroller deems necessary or appropriate; and “(2) the Corporation, against each such State savings association, as the Corporation deems necessary or appropriate.”; (B) in subsection (b), by striking “Director”, each place such term appears, and inserting “Comptroller or Corporation, as appropriate”; (C) in subsection (e)--

(i) by striking “Only the Director” and inserting “The Comptroller”; and (ii) by striking “Director's designee” and inserting “designee of the Comptroller”; (D) by striking subsection (f) and inserting the following:

“(f) [Reserved].”;
(E) in subsection (g)--
(i) in paragraph (1), by striking “Director” and inserting “appropriate Federal banking agency”; and (ii) in paragraph (2), by striking “Director, or the Corporation, as the case may be,” and inserting “appropriate Federal banking agency for the savings association”; (F) in subsection (i), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (G) in subsection (j), by striking “Director's sole discretion” and inserting “sole discretion of the appropriate Federal banking agency”; (H) in subsection (k), by striking “Director may assess against institutions for which the Director is the appropriate Federal banking agency, as defined in
section 3 of the Federal Deposit Insurance Act,” and
inserting “appropriate Federal banking agency may assess against an institution”; and (I) except as provided in subparagraphs (A) through (G), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (8) in section 10 (12 U.S.C. 1467a)-- (A) in subsection (a)(1), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (B) in subsection (b)-- (i) in paragraph (2), by striking “and the regional office of the Director of the district in which its principal office is located,”; and (ii) in paragraph (6), by striking “Director's own motion or application” and inserting “motion or application of the Board”; (C) in subsection (c)-- (i) in paragraph (2)(F), by striking “of Governors of the Federal Reserve System”; (ii) in paragraph (4)(B), in the subparagraph heading, by striking “by director”; (iii) in paragraph (6)(D), in the subparagraph heading, by striking “by director”; and (iv) in paragraph (9)(E), by inserting “(in consultation with the appropriate Federal banking agency)” after “including a determination”; (D) in subsection (g)(5)(B), by striking “the Director's discretion” and inserting “the discretion of the Board”; (E) in subsection (l), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (F) in subsection (m), by striking “Director” and inserting “appropriate Federal banking agency”;

(G) in subsection (p)--
(i) in paragraph (1)--
(I) by striking “Director determines” the 1st place such term appears and inserting “Board or the appropriate Federal banking agency for the savings association determines”; (II) by striking “Director may” and inserting “Board may”; and (III) by striking “Director determines” the 2nd place such term appears and inserting “Board, in consultation with the appropriate Federal banking agency for the savings association determines”; and (ii) in paragraph (2), by striking “Director”, each place such term appears, and inserting “Board”; (H) in subsection (q), by striking “Director”, each place such term appears, and inserting “Board”; (I) in subsection (r), by striking “Director”, each place such term appears, and inserting “Board or appropriate Federal banking agency”; (J) in subsection (s)-- (i) in paragraph (2)-- (I) in subparagraph (B)(ii), by striking “Director's judgment” and inserting “judgment of the appropriate Federal banking agency for the savings association”; and (II) by striking “Director” each place that term appears and inserting “appropriate Federal banking agency for the savings association”; and (ii) in paragraph (4), by striking “Director” and inserting “Comptroller”; and (K) except as provided in subparagraphs (A) through (J), by striking “Director” each place that term appears and inserting “Board”; (9) in section 11 (12 U.S.C. 1468), by striking “Director” each place that term appears and inserting “appropriate Federal banking agency”; (10) in section 12 (12 U.S.C. 1468a), by striking “the Director” and inserting “a Federal banking agency”; and (11) in section 13 (12 U.S.C. 1468a) is amended by striking “Director” and inserting “a Federal banking agency”. SEC. 370. HOUSING ACT OF 1948.

Section 502(c) of the Housing Act of 1948 (12 U.S.C. 1701c(c)) is
amended--
(1) in the matter preceding paragraph (1), by striking “and the Director of the Office of Thrift Supervision” and inserting “, the Comptroller of the Currency, and the Federal Deposit Insurance Corporation”; and (2) in paragraph (3), by striking “Board” and inserting “Agency”. SEC. 371. HOUSING AND COMMUNITY DEVELOPMENT ACT OF 1992.

Section 543 of the Housing and Community Development Act of 1992
(Public Law 102-550; 106 Stat. 3798) is amended-- (1) in subsection (c)(1)-- (A) by striking subparagraphs (D) through (F); and

(B) by redesignating subparagraphs (G) and (H) as subparagraphs (D) and (E), respectively; and (2) in subsection (f)-- (A) in paragraph (2), by striking “the Office of Thrift Supervision,” each place that term appears; and (B) in paragraph (3)-- (i) in the matter preceding subparagraph (A), by striking “the Office of Thrift Supervision,”; and (ii) in subparagraph (D), by striking “Office of Thrift Supervision,”. SEC. 372. HOUSING AND URBAN-RURAL RECOVERY ACT OF 1983.

Section 469 of the Housing and Urban-Rural Recovery Act of 1983 (12
U.S.C. 1701p-1) is amended in the first sentence, by striking “Federal Home Loan Bank Board” and inserting “Federal Housing Finance Agency”. SEC. 373. NATIONAL HOUSING ACT.

Section 202(f) of the National Housing Act (12 U.S.C. 1708(f)) is
amended--
(1) by striking paragraph (5) and inserting the following:
“(5) if the mortgagee is a national bank, a subsidiary or affiliate of such bank, a Federal savings association or a subsidiary or affiliate of a savings association, the Comptroller of the Currency;”; (2) in paragraph (6), by adding “and” at the end; (3) in paragraph (7)-- (A) by inserting “or State savings association” after “State bank”; and (B) by striking “; and” and inserting a period; and (4) by striking paragraph (8). SEC. 374. NEIGHBORHOOD REINVESTMENT CORPORATION ACT.

Section 606(c)(3) of the Neighborhood Reinvestment Corporation Act
(42 U.S.C. 8105(c)(3)) is amended by striking “Federal Home Loan Bank Board” and inserting “Federal Housing Finance Agency”. SEC. 375. PUBLIC LAW 93-100.

Section 5(d) of Public Law 93-100 (12 U.S.C. 1470(a)) is amended--
(1) in paragraph (1), by striking “Federal Savings and Loan Insurance Corporation with respect to insured institutions, the Board of Governors of the Federal Reserve System with respect to State member insured banks, and the Federal Deposit Insurance Corporation with respect to State nonmember insured banks” and inserting “appropriate Federal banking agency, with respect to the institutions subject to the jurisdiction of each such agency,”; and (2) in paragraph (2), by striking “supervisory” and inserting “banking”. SEC. 376. SECURITIES EXCHANGE ACT OF 1934.

The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is amended-- (1) in section 3(a)(34) (15 U.S.C. 78c(a)(34))-- (A) in subparagraph (A)--

(i) in clause (i), by striking “or a subsidiary or a department or division of any such bank” and inserting “a subsidiary or a department or division of any such bank, a Federal savings association (as defined in section 3(b)(2) of the Federal Deposit Insurance Act (12 U.S.C. 1813(b)(2))), the deposits of which are insured by the Federal Deposit Insurance Corporation, or a subsidiary or department or division of any such Federal savings association”; (ii) in clause (ii), by striking “or a subsidiary or a department or division of such subsidiary” and inserting “a subsidiary or a department or division of such subsidiary, or a savings and loan holding company”; (iii) in clause (iii), by striking “or a subsidiary or department or division thereof;” and inserting “a subsidiary or department or division of any such bank, a State savings association (as defined in section 3(b)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1813(b)(3))), the deposits of which are insured by the Federal Deposit Insurance Corporation, or a subsidiary or a department or division of any such State savings association; and”; (iv) by striking clause (iv); and (v) by redesignating clause (v) as clause (iv); (B) in subparagraph (B)-- (i) in clause (i), by striking “or a subsidiary of any such bank” and inserting “a subsidiary of any such bank, a Federal savings association (as defined in section 3(b)(2) of the Federal Deposit Insurance Act (12 U.S.C. 1813(b)(2))), the deposits of which are insured by the Federal Deposit Insurance Corporation, or a subsidiary of any such Federal savings association”; (ii) in clause (ii), by striking “or a subsidiary of a bank holding company which is a bank other than a bank specified in clause (i), (iii), or (iv) of this subparagraph” and inserting “a subsidiary of a bank holding company that is a bank other than a bank specified in clause (i) or (iii) of this subparagraph, or a savings and loan holding company”; (iii) in clause (iii), by striking “or a subsidiary thereof;” and inserting “a subsidiary of any such bank, a State savings association (as defined in section 3(b)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1813(b)(3))), the deposits of which are insured by the Federal Deposit Insurance Corporation, or a subsidiary of any such State savings association; and”; (iv) by striking clause (iv); and (v) by redesignating clause (v) as clause (iv); (C) in subparagraph (C)-- (i) in clause (i), by striking “bank” and inserting “bank or a Federal savings association (as defined in section 3(b)(2) of the Federal Deposit Insurance Act (12 U.S.C. 1813(b)(2))), the deposits of which are insured by the Federal Deposit Insurance Corporation”;

(ii) in clause (ii), by striking “or a subsidiary of a bank holding company which is a bank other than a bank specified in clause (i), (iii), or (iv) of this subparagraph” and inserting “a subsidiary of a bank holding company that is a bank other than a bank specified in clause (i) or (iii) of this subparagraph, or a savings and loan holding company”; (iii) in clause (iii), by striking “System)” and inserting, “System) or a State savings association (as defined in section 3(b)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1813(b)(3))), the deposits of which are insured by the Federal Deposit Insurance Corporation; and”; (iv) by striking clause (iv); and (v) by redesignating clause (v) as clause (iv); (D) in subparagraph (D)-- (i) in clause (i), by inserting after “bank” the following: “or a Federal savings association (as defined in section 3(b)(2) of the Federal Deposit Insurance Act (12 U.S.C. 1813(b)(2))), the deposits of which are insured by the Federal Deposit Insurance Corporation”; (ii) in clause (ii), by adding “and” at the end; (iii) by striking clause (iii); (iv) by redesignating clause (iv) as clause (iii); and (v) in clause (iii), as so redesignated, by inserting after “bank” the following: “or a State savings association (as defined in section 3(b)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1813(b)(3))), the deposits of which are insured by the Federal Deposit Insurance Corporation”; (E) in subparagraph (F)-- (i) in clause (i), by inserting after “bank” the following: “or a Federal savings association (as defined in section 3(b)(2) of the Federal Deposit Insurance Act (12 U.S.C. 1813(b)(2))), the deposits of which are insured by the Federal Deposit Insurance Corporation”; (ii) by striking clause (ii); (iii) by redesignating clauses (iii), (iv), and (v) as clauses (ii), (iii), and (iv), respectively; and (iv) in clause (iii), as so redesignated, by inserting before the semicolon the following: “or a State savings association (as defined in section 3(b)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1813(b)(3))), the deposits of which are insured by the Federal Deposit Insurance Corporation”; (F) in subparagraph (G)-- (i) in clause (i), by inserting after “national bank” the following: “, a Federal savings association (as defined in section 3(b)(2) of the Federal Deposit Insurance Act), the deposits of which are insured by the Federal Deposit Insurance Corporation,”; (ii) in clause (iii)-- (I) by inserting after “bank)” the following: “, a State savings association (as defined in section 3(b)(3) of the Federal Deposit Insurance Act), the deposits of which are insured by the Federal Deposit Insurance Corporation,”; and

(II) by adding “and” at the end;
(iii) by striking clause (iv); and (iv) by redesignating clause (v) as clause (iv); and (G) in the undesignated matter following subparagraph (H), by striking “, and the term `District of Columbia savings and loan association' means any association subject to examination and supervision by the Office of Thrift Supervision under section 8 of the Home Owners' Loan Act of 1933”; (2) in section 12(i) (15 U.S.C. 78l(i))-- (A) in paragraph (1), by inserting after “national banks” the following: “and Federal savings associations, the accounts of which are insured by the Federal Deposit Insurance Corporation”; (B) by striking “(3)” and all that follows through “vested in the Office of Thrift Supervision” and inserting “and (3) with respect to all other insured banks and State savings associations, the accounts of which are insured by the Federal Deposit Insurance Corporation, are vested in the Federal Deposit Insurance Corporation”; and (C) in the second sentence, by striking “the Federal Deposit Insurance Corporation, and the Office of Thrift Supervision” and inserting “and the Federal Deposit Insurance Corporation”; (3) in section 15C(g)(1) (15 U.S.C. 78o-5(g)(1)), by striking “the Director of the Office of Thrift Supervision, the Federal Savings and Loan Insurance Corporation,”; and (4) in section 23(b)(1) (15 U.S.C. 78w(b)(1)), by striking “, other than the Office of Thrift Supervision,”. SEC. 377. TITLE 18, UNITED STATES CODE.

Title 18, United States Code, is amended-- (1) in section 212(c)(2)-- (A) by striking subparagraph (C); and (B) by redesignating subparagraphs (D) through (H) as subparagraphs (C) through (G), respectively; (2) in section 657, by striking “Office of Thrift Supervision, the Resolution Trust Corporation,”; (3) in section 981(a)(1)(D)-- (A) by striking “Resolution Trust Corporation,”; and (B) by striking “or the Office of Thrift Supervision”; (4) in section 982(a)(3)-- (A) by striking “Resolution Trust Corporation,”; and (B) by striking “or the Office of Thrift Supervision”; (5) in section 1006-- (A) by striking “Office of Thrift Supervision,”; and (B) by striking “the Resolution Trust Corporation,”; (6) in section 1014-- (A) by striking “the Office of Thrift Supervision”; and (B) by striking “the Resolution Trust Corporation,”; and (7) in section 1032(1)-- (A) by striking “the Resolution Trust Corporation,”; and (B) by striking “or the Director of the Office of Thrift Supervision”.

SEC. 378. TITLE 31, UNITED STATES CODE.

Title 31, United States Code, is amended-- (1) in section 321-- (A) in subsection (c)-- (i) in paragraph (1), by adding “and” at the end; (ii) in paragraph (2), by striking “; and” and inserting a period; and (iii) by striking paragraph (3); and (B) by striking subsection (e); and (2) in section 714(a), by striking “the Office of the Comptroller of the Currency, and the Office of Thrift Supervision.” and inserting “and the Office of the Comptroller of the Currency.”.

TITLE IV--REGULATION OF ADVISERS TO HEDGE FUNDS AND OTHERS SEC. 401. SHORT TITLE.

This title may be cited as the “Private Fund Investment Advisers Registration Act of 2010”. SEC. 402. DEFINITIONS.

(a) Investment Advisers Act of 1940 Definitions.--Section 202(a) of the Investment Advisers Act of 1940 (15 U.S.C. 80b-2(a)) is amended by adding at the end the following:
“(29) The term private fund' means an issuer that would be an investment company, as defined in section 3 of the Investment Company Act of 1940 (15 U.S.C. 80a-3), but for section 3(c)(1) or 3(c)(7) of that Act. “(30) The term foreign private adviser' means any investment adviser who-- “(A) has no place of business in the United States; “(B) has, in total, fewer than 15 clients and investors in the United States in private funds advised by the investment adviser; “(C) has aggregate assets under management attributable to clients in the United States and investors in the United States in private funds advised by the investment adviser of less than $25,000,000, or such higher amount as the Commission may, by rule, deem appropriate in accordance with the purposes of this title; and “(D) neither-- “(i) holds itself out generally to the public in the United States as an investment adviser; nor “(ii) acts as-- “(I) an investment adviser to any investment company registered under the Investment Company Act of 1940; or “(II) a company that has elected to be a business development company pursuant to section 54 of the Investment Company Act of 1940 (15 U.S.C. 80a-53), and has not withdrawn its election.”.

(b) Other Definitions.--As used in this title, the terms “investment adviser” and “private fund” have the same meanings as in section 202 of the Investment Advisers Act of 1940, as amended by this title.

SEC. 403. ELIMINATION OF PRIVATE ADVISER EXEMPTION; LIMITED EXEMPTION FOR FOREIGN PRIVATE ADVISERS; LIMITED INTRASTATE EXEMPTION.

Section 203(b) of the Investment Advisers Act of 1940 (15 U.S.C.
80b-3(b)) is amended--
(1) in paragraph (1), by inserting “, other than an investment adviser who acts as an investment adviser to any private fund,” before “all of whose”; (2) by striking paragraph (3) and inserting the following:
“(3) any investment adviser that is a foreign private adviser;”; and (3) in paragraph (5), by striking “or” at the end; (4) in paragraph (6)-- (A) by striking “any investment adviser” and inserting “(A) any investment adviser”; (B) by redesignating subparagraphs (A) and (B) as clauses (i) and (ii), respectively; and (C) in clause (ii) (as so redesignated), by striking the period at the end and inserting “; or”; and (D) by adding at the end the following:

“(B) any investment adviser that is registered with the Commodity Futures Trading Commission as a commodity trading advisor and advises a private fund, provided that, if after the date of enactment of the Private Fund Investment Advisers Registration Act of 2010, the business of the advisor should become predominately the provision of securities- related advice, then such adviser shall register with the Commission.”. (5) by adding at the end the following:
“(7) any investment adviser, other than any entity that has elected to be regulated or is regulated as a business development company pursuant to section 54 of the Investment Company Act of 1940 (15 U.S.C. 80a-54), who solely advises-- “(A) small business investment companies that are licensees under the Small Business Investment Act of 1958; “(B) entities that have received from the Small Business Administration notice to proceed to qualify for a license as a small business investment company under the Small Business Investment Act of 1958, which notice or license has not been revoked; or “(C) applicants that are affiliated with 1 or more licensed small business investment companies described in subparagraph (A) and that have applied for another license under the Small Business Investment Act of 1958, which application remains pending.”. SEC. 404. COLLECTION OF SYSTEMIC RISK DATA; REPORTS; EXAMINATIONS; DISCLOSURES.

Section 204 of the Investment Advisers Act of 1940 (15 U.S.C. 80b-4)
is amended--
(1) by redesignating subsections (b) and (c) as subsections (c) and (d), respectively; and (2) by inserting after subsection (a) the following:

“(b) Records and Reports of Private Funds.-- “(1) In general.--The Commission may require any investment adviser registered under this title-- “(A) to maintain such records of, and file with the Commission such reports regarding, private funds advised

by the investment adviser, as necessary and appropriate in the public interest and for the protection of investors, or for the assessment of systemic risk by the Financial Stability Oversight Council (in this subsection referred to as the `Council'); and “(B) to provide or make available to the Council those reports or records or the information contained therein. “(2) Treatment of records.--The records and reports of any private fund to which an investment adviser registered under this title provides investment advice shall be deemed to be the records and reports of the investment adviser. “(3) Required information.--The records and reports required to be maintained by an investment adviser and subject to inspection by the Commission under this subsection shall include, for each private fund advised by the investment adviser, a description of-- “(A) the amount of assets under management and use of leverage, including off-balance-sheet leverage; “(B) counterparty credit risk exposure; “(C) trading and investment positions; “(D) valuation policies and practices of the fund; “(E) types of assets held; “(F) side arrangements or side letters, whereby certain investors in a fund obtain more favorable rights or entitlements than other investors; “(G) trading practices; and “(H) such other information as the Commission, in consultation with the Council, determines is necessary and appropriate in the public interest and for the protection of investors or for the assessment of systemic risk, which may include the establishment of different reporting requirements for different classes of fund advisers, based on the type or size of private fund being advised. “(4) Maintenance of records.--An investment adviser registered under this title shall maintain such records of private funds advised by the investment adviser for such period or periods as the Commission, by rule, may prescribe as necessary and appropriate in the public interest and for the protection of investors, or for the assessment of systemic risk. “(5) Filing of records.--The Commission shall issue rules requiring each investment adviser to a private fund to file reports containing such information as the Commission deems necessary and appropriate in the public interest and for the protection of investors or for the assessment of systemic risk. “(6) Examination of records.-- “(A) Periodic and special examinations.--The Commission-- “(i) shall conduct periodic inspections of the records of private funds maintained by an investment adviser registered under this title in accordance with a schedule established by the Commission; and “(ii) may conduct at any time and from time to time such additional, special, and other examinations as the Commission may prescribe as necessary and appropriate in the public interest and for the protection of investors, or for the assessment of systemic risk.

“(B) Availability of records.--An investment adviser registered under this title shall make available to the Commission any copies or extracts from such records as may be prepared without undue effort, expense, or delay, as the Commission or its representatives may reasonably request. “(7) Information sharing.-- “(A) In general.--The Commission shall make available to the Council copies of all reports, documents, records, and information filed with or provided to the Commission by an investment adviser under this subsection as the Council may consider necessary for the purpose of assessing the systemic risk posed by a private fund. “(B) Confidentiality.--The Council shall maintain the confidentiality of information received under this paragraph in all such reports, documents, records, and information, in a manner consistent with the level of confidentiality established for the Commission pursuant to paragraph (8). The Council shall be exempt from
section 552 of title 5, United States Code, with respect
to any information in any report, document, record, or information made available, to the Council under this subsection.”. “(8) Commission confidentiality of reports.-- Notwithstanding any other provision of law, the Commission may not be compelled to disclose any report or information contained therein required to be filed with the Commission under this subsection, except that nothing in this subsection authorizes the Commission-- “(A) to withhold information from Congress, upon an agreement of confidentiality; or “(B) prevent the Commission from complying with-- “(i) a request for information from any other Federal department or agency or any self- regulatory organization requesting the report or information for purposes within the scope of its jurisdiction; or “(ii) an order of a court of the United States in an action brought by the United States or the Commission. “(9) Other recipients confidentiality.--Any department, agency, or self-regulatory organization that receives reports or information from the Commission under this subsection shall maintain the confidentiality of such reports, documents, records, and information in a manner consistent with the level of confidentiality established for the Commission under paragraph (8). “(10) Public information exception.-- “(A) In general.--The Commission, the Council, and any other department, agency, or self-regulatory organization that receives information, reports, documents, records, or information from the Commission under this subsection, shall be exempt from the provisions of section 552 of title 5, United States Code, with respect to any such report, document, record, or information. Any proprietary information of an investment adviser ascertained by the Commission from any report required to be filed with the Commission pursuant to this subsection shall be subject to the same limitations on public disclosure as any facts

ascertained during an examination, as provided by
section 210(b) of this title.
“(B) Proprietary information.--For purposes of this paragraph, proprietary information includes sensitive, non-public information regarding-- “(i) the investment or trading strategies of the investment adviser; “(ii) analytical or research methodologies; “(iii) trading data; “(iv) computer hardware or software containing intellectual property; and “(v) any additional information that the Commission determines to be proprietary. “(11) Annual report to congress.--The Commission shall report annually to Congress on how the Commission has used the data collected pursuant to this subsection to monitor the markets for the protection of investors and the integrity of the markets.”. SEC. 405. DISCLOSURE PROVISION AMENDMENT.

Section 210(c) of the Investment Advisers Act of 1940 (15 U.S.C.
80b-10(c)) is amended by inserting before the period at the end the following: “or for purposes of assessment of potential systemic risk”. SEC. 406. CLARIFICATION OF RULEMAKING AUTHORITY.

Section 211 of the Investment Advisers Act of 1940 (15 U.S.C. 80b-
11) is amended--
(1) in subsection (a), by inserting before the period at the end of the first sentence the following: “, including rules and regulations defining technical, trade, and other terms used in this title, except that the Commission may not define the term `client' for purposes of paragraphs (1) and (2) of section 206 to include an investor in a private fund managed by an investment adviser, if such private fund has entered into an advisory contract with such adviser”; and (2) by adding at the end the following:

“(e) Disclosure Rules on Private Funds.-- The Commission and the Commodity Futures Trading Commission shall, after consultation with the Council but not later than 12 months after the date of enactment of the Private Fund Investment Advisers Registration Act of 2010, jointly promulgate rules to establish the form and content of the reports required to be filed with the Commission under subsection 204(b) and with the Commodity Futures Trading Commission by investment advisers that are registered both under this title and the Commodity Exchange Act (7 U.S.C. 1a et seq.).”. SEC. 407. EXEMPTION OF AND REPORTING BY VENTURE CAPITAL FUND ADVISERS.

Section 203 of the Investment Advisers Act of 1940 (15 U.S.C. 80b-3)
is amended by adding at the end the following:
“(l) Exemption of Venture Capital Fund Advisers.--No investment adviser that acts as an investment adviser solely to 1 or more venture capital funds shall be subject to the registration requirements of this title with respect to the provision of investment advice relating to a venture capital fund. Not later than 1 year after the date of enactment of this subsection, the Commission

shall issue final rules to define the term `venture capital fund' for purposes of this subsection. The Commission shall require such advisers to maintain such records and provide to the Commission such annual or other reports as the Commission determines necessary or appropriate in the public interest or for the protection of investors.”. SEC. 408. EXEMPTION OF AND REPORTING BY CERTAIN PRIVATE FUND ADVISERS.

Section 203 of the Investment Advisers Act of 1940 (15 U.S.C. 80b-3)
is amended by adding at the end the following:
“(m) Exemption of and Reporting by Certain Private Fund Advisers.-- “(1) In general.--The Commission shall provide an exemption from the registration requirements under this section to any investment adviser of private funds, if each of such investment adviser acts solely as an adviser to private funds and has assets under management in the United States of less than $150,000,000. “(2) Reporting.--The Commission shall require investment advisers exempted by reason of this subsection to maintain such records and provide to the Commission such annual or other reports as the Commission determines necessary or appropriate in the public interest or for the protection of investors.

“(n) Registration and Examination of Mid-sized Private Fund Advisers.--In prescribing regulations to carry out the requirements of this section with respect to investment advisers acting as investment advisers to mid-sized private funds, the Commission shall take into account the size, governance, and investment strategy of such funds to determine whether they pose systemic risk, and shall provide for registration and examination procedures with respect to the investment advisers of such funds which reflect the level of systemic risk posed by such funds.”. SEC. 409. FAMILY OFFICES.

(a) In General.--Section 202(a)(11) of the Investment Advisers Act of 1940 (15 U.S.C. 80b-2(a)(11)) is amended by striking “or (G)” and inserting the following: “; (G) any family office, as defined by rule, regulation, or order of the Commission, in accordance with the purposes of this title; or (H)”. (b) Rulemaking.--The rules, regulations, or orders issued by the Commission pursuant to section 202(a)(11)(G) of the Investment Advisers Act of 1940, as added by this
section, regarding the definition of the term “family office” shall
provide for an exemption that--
(1) is consistent with the previous exemptive policy of the Commission, as reflected in exemptive orders for family offices in effect on the date of enactment of this Act, and the grandfathering provisions in paragraph (3); (2) recognizes the range of organizational, management, and employment structures and arrangements employed by family offices; and (3) does not exclude any person who was not registered or required to be registered under the Investment Advisers Act of 1940 on January 1, 2010 from the definition of the term “family office”, solely because such person provides investment advice to, and was engaged before January 1, 2010 in providing investment advice to--

(A) natural persons who, at the time of their applicable investment, are officers, directors, or employees of the family office who-- (i) have invested with the family office before January 1, 2010; and (ii) are accredited investors, as defined in Regulation D of the Commission (or any successor thereto) under the Securities Act of 1933, or, as the Commission may prescribe by rule, the successors-in-interest thereto; (B) any company owned exclusively and controlled by members of the family of the family office, or as the Commission may prescribe by rule; (C) any investment adviser registered under the Investment Adviser Act of 1940 that provides investment advice to the family office and who identifies investment opportunities to the family office, and invests in such transactions on substantially the same terms as the family office invests, but does not invest in other funds advised by the family office, and whose assets as to which the family office directly or indirectly provides investment advice represent, in the aggregate, not more than 5 percent of the value of the total assets as to which the family office provides investment advice.

(c) Antifraud Authority.--A family office that would not be a family office, but for subsection (b)(3), shall be deemed to be an investment adviser for the purposes of paragraphs (1), (2) and (4) of section 206 of the Investment Advisers Act of 1940. SEC. 410. STATE AND FEDERAL RESPONSIBILITIES; ASSET THRESHOLD FOR FEDERAL REGISTRATION OF INVESTMENT ADVISERS.

Section 203A(a) of the of the Investment Advisers Act of 1940 (15
U.S.C. 80b-3a(a)) is amended--
(1) by redesignating paragraph (2) as paragraph (3); and (2) by inserting after paragraph (1) the following:
“(2) Treatment of mid-sized investment advisers.-- “(A) In general.--No investment adviser described in subparagraph (B) shall register under section 203, unless the investment adviser is an adviser to an investment company registered under the Investment Company Act of 1940, or a company which has elected to be a business development company pursuant to section 54 of the Investment Company Act of 1940, and has not withdrawn the election, except that, if by effect of this paragraph an investment adviser would be required to register with 15 or more States, then the adviser may register under section 203. “(B) Covered persons.--An investment adviser described in this subparagraph is an investment adviser that-- “(i) is required to be registered as an investment adviser with the securities commissioner (or any agency or office performing like functions) of the State in which it maintains its principal office and place of business and, if registered, would be subject to examination as an investment adviser by any such commissioner, agency, or office; and

“(ii) has assets under management between-- “(I) the amount specified under subparagraph (A) of paragraph (1), as such amount may have been adjusted by the Commission pursuant to that subparagraph; and “(II) $100,000,000, or such higher amount as the Commission may, by rule, deem appropriate in accordance with the purposes of this title.”. SEC. 411. CUSTODY OF CLIENT ASSETS.

The Investment Advisers Act of 1940 (15 U.S.C. 80b-1 et seq.) is amended by adding at the end the following new section:
“SEC. 223. CUSTODY OF CLIENT ACCOUNTS.

“An investment adviser registered under this title shall take such steps to safeguard client assets over which such adviser has custody, including, without limitation, verification of such assets by an independent public accountant, as the Commission may, by rule, prescribe.”. SEC. 412. COMPTROLLER GENERAL STUDY ON CUSTODY RULE COSTS.

The Comptroller General of the United States shall-- (1) conduct a study of-- (A) the compliance costs associated with the current Securities and Exchange Commission rules 204-2 (17 C.F.R. Parts 275.204-2) and rule 206(4)-2 (17 C.F.R. 275.206(4)-2) under the Investment Advisers Act of 1940 regarding custody of funds or securities of clients by investment advisers; and (B) the additional costs if subsection (b)(6) of rule 206(4)-2 (17 C.F.R. 275.206(4)-2(b)(6)) relating to operational independence were eliminated; and (2) submit a report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives on the results of such study, not later than 3 years after the date of enactment of this Act. SEC. 413. ADJUSTING THE ACCREDITED INVESTOR STANDARD.

(a) In General.--The Commission shall adjust any net worth standard for an accredited investor, as set forth in the rules of the Commission under the Securities Act of 1933, so that the individual net worth of any natural person, or joint net worth with the spouse of that person, at the time of purchase, is more than $1,000,000 (as such amount is adjusted periodically by rule of the Commission), excluding the value of the primary residence of such natural person, except that during the 4- year period that begins on the date of enactment of this Act, any net worth standard shall be $1,000,000, excluding the value of the primary residence of such natural person. (b) Review and Adjustment.-- (1) Initial review and adjustment.-- (A) Initial review.--The Commission may undertake a review of the definition of the term “accredited investor”, as such term applies to natural persons, to determine whether the requirements of the definition, excluding the requirement relating to the net worth standard described in subsection (a), should be adjusted or modified for the

protection of investors, in the public interest, and in light of the economy. (B) Adjustment or modification.--Upon completion of a review under subparagraph (A), the Commission may, by notice and comment rulemaking, make such adjustments to the definition of the term “accredited investor”, excluding adjusting or modifying the requirement relating to the net worth standard described in subsection (a), as such term applies to natural persons, as the Commission may deem appropriate for the protection of investors, in the public interest, and in light of the economy. (2) Subsequent reviews and adjustment.-- (A) Subsequent reviews. --Not earlier than 4 years after the date of enactment of this Act, and not less frequently than once every 4 years thereafter, the Commission shall undertake a review of the definition, in its entirety, of the term “accredited investor”, as defined in section 230.215 of title 17, Code of Federal Regulations, or any successor thereto, as such term applies to natural persons, to determine whether the requirements of the definition should be adjusted or modified for the protection of investors, in the public interest, and in light of the economy. (B) Adjustment or modification.--Upon completion of a review under subparagraph (A), the Commission may, by notice and comment rulemaking, make such adjustments to the definition of the term “accredited investor”, as defined in section 230.215 of title 17, Code of Federal Regulations, or any successor thereto, as such term applies to natural persons, as the Commission may deem appropriate for the protection of investors, in the public interest, and in light of the economy. SEC. 414. RULE OF CONSTRUCTION RELATING TO THE COMMODITIES EXCHANGE ACT.

The Investment Advisers Act of 1940 (15 U.S.C. 80b-1 et seq.) is further amended by adding at the end the following new section:
“SEC. 224. RULE OF CONSTRUCTION
RELATING TO THE COMMODITIES EXCHANGE ACT.

“Nothing in this title shall relieve any person of any obligation or duty, or affect the availability of any right or remedy available to the Commodity Futures Trading Commission or any private party, arising under the Commodity Exchange Act (7 U.S.C. 1 et seq.) governing commodity pools, commodity pool operators, or commodity trading advisors.”. SEC. 415. GAO STUDY AND REPORT ON ACCREDITED INVESTORS.

The Comptroller General of the United States shall conduct a study on the appropriate criteria for determining the financial thresholds or other criteria needed to qualify for accredited investor status and eligibility to invest in private funds, and shall submit a report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives on the results of such study not later than 3 years after the date of enactment of this Act.

SEC. 416. GAO STUDY ON SELF-REGULATORY ORGANIZATION FOR PRIVATE FUNDS.

The Comptroller General of the United States shall-- (1) conduct a study of the feasibility of forming a self- regulatory organization to oversee private funds; and (2) submit a report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives on the results of such study, not later than 1 year after the date of enactment of this Act. SEC. 417. COMMISSION STUDY AND REPORT ON SHORT SELLING.

(a) Studies.--The Division of Risk, Strategy, and Financial Innovation of the Commission shall conduct-- (1) a study, taking into account current scholarship, on the state of short selling on national securities exchanges and in the over-the-counter markets, with particular attention to the impact of recent rule changes and the incidence of-- (A) the failure to deliver shares sold short; or (B) delivery of shares on the fourth day following the short sale transaction; and (2) a study of-- (A) the feasibility, benefits, and costs of requiring reporting publicly, in real time short sale positions of publicly listed securities, or, in the alternative, reporting such short positions in real time only to the Commission and the Financial Industry Regulatory Authority; and (B) the feasibility, benefits, and costs of conducting a voluntary pilot program in which public companies will agree to have all trades of their shares marked “short”, “market maker short”, “buy”, “buy-to-cover”, or “long”, and reported in real time through the Consolidated Tape.

(b) Reports.--The Commission shall submit a report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives-- (1) on the results of the study required under subsection (a)(1), including recommendations for market improvements, not later than 2 years after the date of enactment of this Act; and (2) on the results of the study required under subsection (a)(2), not later than 1 year after the date of enactment of this Act. SEC. 418. QUALIFIED CLIENT STANDARD.

Section 205(e) of the Investment Advisers Act of 1940 (15 U.S.C.
80b-5(e)) is amended by adding at the end the following: “With respect to any factor used in any rule or regulation by the Commission in making a determination under this subsection, if the Commission uses a dollar amount test in connection with such factor, such as a net asset threshold, the Commission shall, by order, not later than 1 year after the date of enactment of the Private Fund Investment Advisers Registration Act of 2010, and every 5 years thereafter, adjust for the effects of inflation on such test. Any such adjustment that is not a multiple of $100,000 shall be rounded to the nearest multiple of $100,000.”.

SEC. 419. TRANSITION
PERIOD.

Except as otherwise provided in this title, this title and the amendments made by this title shall become effective 1 year after the date of enactment of this Act, except that any investment adviser may, at the discretion of the investment adviser, register with the Commission under the Investment Advisers Act of 1940 during that 1-year period, subject to the rules of the Commission.

TITLE V--INSURANCE

Subtitle A--Federal Insurance Office SEC. 501. SHORT TITLE.

This subtitle may be cited as the “Federal Insurance Office Act of 2010”. SEC. 502. FEDERAL INSURANCE OFFICE.

(a) Establishment of Office.--Subchapter I of chapter 3 of subtitle I of title 31, United States Code, is amended-- (1) by redesignating section 312 as section 315; (2) by redesignating section 313 as section 312; and (3) by inserting after section 312 (as so redesignated) the following new sections:
“SEC. 313. FEDERAL INSURANCE OFFICE.

“(a) Establishment.--There is established within the Department of the Treasury the Federal Insurance Office. “(b) Leadership.--The Office shall be headed by a Director, who shall be appointed by the Secretary of the Treasury. The position of Director shall be a career reserved position in the Senior Executive Service, as that position is defined under section 3132 of title 5, United States Code. “(c) Functions.-- “(1) Authority pursuant to direction of secretary.--The Office, pursuant to the direction of the Secretary, shall have the authority-- “(A) to monitor all aspects of the insurance industry, including identifying issues or gaps in the regulation of insurers that could contribute to a systemic crisis in the insurance industry or the United States financial system; “(B) to monitor the extent to which traditionally underserved communities and consumers, minorities (as such term is defined in section 1204(c) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1811 note)), and low- and moderate- income persons have access to affordable insurance products regarding all lines of insurance, except health insurance; “(C) to recommend to the Financial Stability Oversight Council that it designate an insurer, including the affiliates of such insurer, as an entity subject to regulation as a nonbank financial company supervised by the Board of Governors pursuant to title I of the Dodd-Frank Wall Street Reform and Consumer Protection Act; “(D) to assist the Secretary in administering the Terrorism Insurance Program established in the Department

of the Treasury under the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note); “(E) to coordinate Federal efforts and develop Federal policy on prudential aspects of international insurance matters, including representing the United States, as appropriate, in the International Association of Insurance Supervisors (or a successor entity) and assisting the Secretary in negotiating covered agreements (as such term is defined in subsection (r)); “(F) to determine, in accordance with subsection (f), whether State insurance measures are preempted by covered agreements; “(G) to consult with the States (including State insurance regulators) regarding insurance matters of national importance and prudential insurance matters of international importance; and “(H) to perform such other related duties and authorities as may be assigned to the Office by the Secretary. “(2) Advisory functions.--The Office shall advise the Secretary on major domestic and prudential international insurance policy issues. “(3) Advisory capacity on council.--The Director shall serve in an advisory capacity on the Financial Stability Oversight Council established under the Financial Stability Act of 2010.

“(d) Scope.--The authority of the Office shall extend to all lines of insurance except-- “(1) health insurance, as determined by the Secretary in coordination with the Secretary of Health and Human Services based on section 2791 of the Public Health Service Act (42 U.S.C. 300gg-91); “(2) long-term care insurance, except long-term care insurance that is included with life or annuity insurance components, as determined by the Secretary in coordination with the Secretary of Health and Human Services, and in the case of long-term care insurance that is included with such components, the Secretary shall coordinate with the Secretary of Health and Human Services in performing the functions of the Office; and “(3) crop insurance, as established by the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.).

“(e) Gathering of Information.--
“(1) In general.--In carrying out the functions required under subsection (c), the Office may-- “(A) receive and collect data and information on and from the insurance industry and insurers; “(B) enter into information-sharing agreements; “(C) analyze and disseminate data and information; and “(D) issue reports regarding all lines of insurance except health insurance. “(2) Collection of information from insurers and affiliates.-- “(A) In general.--Except as provided in paragraph (3), the Office may require an insurer, or any affiliate of an insurer, to submit such data or information as the

Office may reasonably require in carrying out the functions described under subsection (c). “(B) Rule of construction.--Notwithstanding any other provision of this section, for purposes of subparagraph (A), the term `insurer' means any entity that writes insurance or reinsures risks and issues contracts or policies in 1 or more States. “(3) Exception for small insurers.--Paragraph (2) shall not apply with respect to any insurer or affiliate thereof that meets a minimum size threshold that the Office may establish, whether by order or rule. “(4) Advance coordination.--Before collecting any data or information under paragraph (2) from an insurer, or affiliate of an insurer, the Office shall coordinate with each relevant Federal agency and State insurance regulator (or other relevant Federal or State regulatory agency, if any, in the case of an affiliate of an insurer) and any publicly available sources to determine if the information to be collected is available from, and may be obtained in a timely manner by, such Federal agency or State insurance regulator, individually or collectively, other regulatory agency, or publicly available sources. If the Director determines that such data or information is available, and may be obtained in a timely manner, from such an agency, regulator, regulatory agency, or source, the Director shall obtain the data or information from such agency, regulator, regulatory agency, or source. If the Director determines that such data or information is not so available, the Director may collect such data or information from an insurer (or affiliate) only if the Director complies with the requirements of subchapter I of chapter 35 of title 44, United States Code (relating to Federal information policy; commonly known as the Paperwork Reduction Act), in collecting such data or information. Notwithstanding any other provision of law, each such relevant Federal agency and State insurance regulator or other Federal or State regulatory agency is authorized to provide to the Office such data or information. “(5) Confidentiality.-- “(A) Retention of privilege.--The submission of any nonpublicly available data and information to the Office under this subsection shall not constitute a waiver of, or otherwise affect, any privilege arising under Federal or State law (including the rules of any Federal or State court) to which the data or information is otherwise subject. “(B) Continued application of prior confidentiality agreements.--Any requirement under Federal or State law to the extent otherwise applicable, or any requirement pursuant to a written agreement in effect between the original source of any nonpublicly available data or information and the source of such data or information to the Office, regarding the privacy or confidentiality of any data or information in the possession of the source to the Office, shall continue to apply to such data or information after the data or information has been provided pursuant to this
subsection to the Office. “(C) Information-sharing agreement.--Any data or information obtained by the Office may be made available

to State insurance regulators, individually or collectively, through an information-sharing agreement that-- “(i) shall comply with applicable Federal law; and “(ii) shall not constitute a waiver of, or otherwise affect, any privilege under Federal or State law (including the rules of any Federal or State court) to which the data or information is otherwise subject. “(D) Agency disclosure requirements.--Section 552 of title 5, United States Code, shall apply to any data or information submitted to the Office by an insurer or an affiliate of an insurer. “(6) Subpoenas and enforcement.--The Director shall have the power to require by subpoena the production of the data or information requested under paragraph (2), but only upon a written finding by the Director that such data or information is required to carry out the functions described under subsection (c) and that the Office has coordinated with such regulator or agency as required under paragraph (4). Subpoenas shall bear the signature of the Director and shall be served by any person or class of persons designated by the Director for that purpose. In the case of contumacy or failure to obey a subpoena, the subpoena shall be enforceable by order of any appropriate district court of the United States. Any failure to obey the order of the court may be punished by the court as a contempt of court.

“(f) Preemption of State Insurance Measures.-- “(1) Standard.--A State insurance measure shall be preempted pursuant to this section or section 314 if, and only to the extent that the Director determines, in accordance with this subsection, that the measure-- “(A) results in less favorable treatment of a non- United States insurer domiciled in a foreign jurisdiction that is subject to a covered agreement than a United States insurer domiciled, licensed, or otherwise admitted in that State; and “(B) is inconsistent with a covered agreement. “(2) Determination.-- “(A) Notice of potential inconsistency.--Before making any determination under paragraph (1), the Director shall-- “(i) notify and consult with the appropriate State regarding any potential inconsistency or preemption; “(ii) notify and consult with the United States Trade Representative regarding any potential inconsistency or preemption; “(iii) cause to be published in the Federal Register notice of the issue regarding the potential inconsistency or preemption, including a description of each State insurance measure at issue and any applicable covered agreement; “(iv) provide interested parties a reasonable opportunity to submit written comments to the Office; and “(v) consider any comments received. “(B) Scope of review.--For purposes of this subsection, any determination of the Director regarding State insurance measures, and any preemption under paragraph (1) as a result of such determination, shall be limited

to the subject matter contained within the covered agreement involved and shall achieve a level of protection for insurance or reinsurance consumers that is substantially equivalent to the level of protection achieved under State insurance or reinsurance regulation. “(C) Notice of determination of inconsistency.-- Upon making any determination under paragraph (1), the Director shall-- “(i) notify the appropriate State of the determination and the extent of the inconsistency; “(ii) establish a reasonable period of time, which shall not be less than 30 days, before the determination shall become effective; and “(iii) notify the Committees on Financial Services and Ways and Means of the House of Representatives and the Committees on Banking, Housing, and Urban Affairs and Finance of the Senate. “(3) Notice of effectiveness.--Upon the conclusion of the period referred to in paragraph (2)(C)(ii), if the basis for such determination still exists, the determination shall become effective and the Director shall-- “(A) cause to be published a notice in the Federal Register that the preemption has become effective, as well as the effective date; and “(B) notify the appropriate State. “(4) Limitation.--No State may enforce a State insurance measure to the extent that such measure has been preempted under this subsection.

“(g) Applicability of Administrative Procedures Act.-- Determinations of inconsistency made pursuant to subsection (f)(2) shall be subject to the applicable provisions of subchapter II of chapter 5 of title 5, United States Code (relating to administrative procedure), and
chapter 7 of such title (relating to judicial review), except that in
any action for judicial review of a determination of inconsistency, the court shall determine the matter de novo. “(h) Regulations, Policies, and Procedures.--The Secretary may issue orders, regulations, policies, and procedures to implement this
section.
“(i) Consultation.--The Director shall consult with State insurance regulators, individually or collectively, to the extent the Director determines appropriate, in carrying out the functions of the Office. “(j) Savings Provisions.--Nothing in this section shall-- “(1) preempt-- “(A) any State insurance measure that governs any insurer's rates, premiums, underwriting, or sales practices; “(B) any State coverage requirements for insurance; “(C) the application of the antitrust laws of any State to the business of insurance; or “(D) any State insurance measure governing the capital or solvency of an insurer, except to the extent that such State insurance measure results in less favorable treatment of a non-United State insurer than a United States insurer; “(2) be construed to alter, amend, or limit any provision of the Consumer Financial Protection Agency Act of 2010; or “(3) affect the preemption of any State insurance measure otherwise inconsistent with and preempted by Federal law.

“(k) Retention of Existing State Regulatory Authority.--Nothing in this section or section 314 shall be construed to establish or provide the Office or the Department of the Treasury with general supervisory or regulatory authority over the business of insurance. “(l) Retention of Authority of Federal Financial Regulatory Agencies.--Nothing in this section or section 314 shall be construed to limit the authority of any Federal financial regulatory agency, including the authority to develop and coordinate policy, negotiate, and enter into agreements with foreign governments, authorities, regulators, and multinational regulatory committees and to preempt State measures to affect uniformity with international regulatory agreements. “(m) Retention of Authority of United States Trade Representative.--Nothing in this section or section 314 shall be construed to affect the authority of the Office of the United States Trade Representative pursuant to section 141 of the Trade Act of 1974 (19 U.S.C. 2171) or any other provision of law, including authority over the development and coordination of United States international trade policy and the administration of the United States trade agreements program. “(n) Annual Reports to Congress.-- “(1) Section 313(f) reports.--Beginning September 30, 2011, the Director shall submit a report on or before September 30 of each calendar year to the President and to the Committees on Financial Services and Ways and Means of the House of Representatives and the Committees on Banking, Housing, and Urban Affairs and Finance of the Senate on any actions taken by the Office pursuant to subsection (f) (regarding preemption of inconsistent State insurance measures). “(2) Insurance industry.--Beginning September 30, 2011, the Director shall submit a report on or before September 30 of each calendar year to the President and to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate on the insurance industry and any other information as deemed relevant by the Director or requested by such Committees.

“(o) Reports on U.S. and Global Reinsurance Market.--The Director shall submit to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate-- “(1) a report received not later than September 30, 2012, describing the breadth and scope of the global reinsurance market and the critical role such market plays in supporting insurance in the United States; and “(2) a report received not later than January 1, 2013, and updated not later than January 1, 2015, describing the impact of
part II of the Nonadmitted and Reinsurance Reform Act of 2010 on
the ability of State regulators to access reinsurance information for regulated companies in their jurisdictions.

“(p) Study and Report on Regulation of Insurance.-- “(1) In general.--Not later than 18 months after the date of enactment of this section, the Director shall conduct a study and submit a report to Congress on how to modernize and improve the system of insurance regulation in the United States.

“(2) Considerations.--The study and report required under paragraph (1) shall be based on and guided by the following considerations:
“(A) Systemic risk regulation with respect to insurance. “(B) Capital standards and the relationship between capital allocation and liabilities, including standards relating to liquidity and duration risk. “(C) Consumer protection for insurance products and practices, including gaps in State regulation. “(D) The degree of national uniformity of State insurance regulation. “(E) The regulation of insurance companies and affiliates on a consolidated basis. “(F) International coordination of insurance regulation. “(3) Additional factors.--The study and report required under paragraph (1) shall also examine the following factors:
“(A) The costs and benefits of potential Federal regulation of insurance across various lines of insurance (except health insurance). “(B) The feasibility of regulating only certain lines of insurance at the Federal level, while leaving other lines of insurance to be regulated at the State level. “(C) The ability of any potential Federal regulation or Federal regulators to eliminate or minimize regulatory arbitrage. “(D) The impact that developments in the regulation of insurance in foreign jurisdictions might have on the potential Federal regulation of insurance. “(E) The ability of any potential Federal regulation or Federal regulator to provide robust consumer protection for policyholders. “(F) The potential consequences of subjecting insurance companies to a Federal resolution authority, including the effects of any Federal resolution authority-- “(i) on the operation of State insurance guaranty fund systems, including the loss of guaranty fund coverage if an insurance company is subject to a Federal resolution authority; “(ii) on policyholder protection, including the loss of the priority status of policyholder claims over other unsecured general creditor claims; “(iii) in the case of life insurance companies, on the loss of the special status of separate account assets and separate account liabilities; and “(iv) on the international competitiveness of insurance companies. “(G) Such other factors as the Director determines necessary or appropriate, consistent with the principles set forth in paragraph (2). “(4) Required recommendations.--The study and report required under paragraph (1) shall also contain any legislative, administrative, or regulatory recommendations, as the Director determines appropriate, to carry out or effectuate the findings set forth in such report. “(5) Consultation.--With respect to the study and report required under paragraph (1), the Director shall consult with

the State insurance regulators, consumer organizations, representatives of the insurance industry and policyholders, and other organizations and experts, as appropriate.

“(q) Use of Existing Resources.--To carry out this section, the Office may employ personnel, facilities, and any other resource of the Department of the Treasury available to the Secretary and the Secretary shall dedicate specific personnel to the Office. “(r) Definitions.--In this section and section 314, the following definitions shall apply:
“(1) Affiliate.--The term affiliate' means, with respect to an insurer, any person who controls, is controlled by, or is under common control with the insurer. “(2) Covered agreement.--The term covered agreement' means a written bilateral or multilateral agreement regarding prudential measures with respect to the business of insurance or reinsurance that-- “(A) is entered into between the United States and one or more foreign governments, authorities, or regulatory entities; and “(B) relates to the recognition of prudential measures with respect to the business of insurance or reinsurance that achieves a level of protection for insurance or reinsurance consumers that is substantially equivalent to the level of protection achieved under State insurance or reinsurance regulation. “(3) Insurer.--The term insurer' means any person engaged in the business of insurance, including reinsurance. “(4) Federal financial regulatory agency.--The term Federal financial regulatory agency' means the Department of the Treasury, the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, the Office of Thrift Supervision, the Securities and Exchange Commission, the Commodity Futures Trading Commission, the Federal Deposit Insurance Corporation, the Federal Housing Finance Agency, or the National Credit Union Administration. “(5) Non-united states insurer.--The term non-United States insurer' means an insurer that is organized under the laws of a jurisdiction other than a State, but does not include any United States branch of such an insurer. “(6) Office.--The term Office' means the Federal Insurance Office established by this section. “(7) State insurance measure.--The term State insurance measure' means any State law, regulation, administrative ruling, bulletin, guideline, or practice relating to or affecting prudential measures applicable to insurance or reinsurance. “(8) State insurance regulator.--The term State insurance regulator' means any State regulatory authority responsible for the supervision of insurers. “(9) Substantially equivalent to the level of protection achieved.--The term substantially equivalent to the level of protection achieved' means the prudential measures of a foreign government, authority, or regulatory entity achieve a similar outcome in consumer protection as the outcome achieved under State insurance or reinsurance regulation. “(10) United states insurer.--The term United States insurer' means--

“(A) an insurer that is organized under the laws of a State; or “(B) a United States branch of a non-United States insurer.

“(s) Authorization of Appropriations.--There are authorized to be appropriated for the Office for each fiscal year such sums as may be necessary. “SEC. 314. COVERED AGREEMENTS.

“(a) Authority.--The Secretary and the United States Trade Representative are authorized, jointly, to negotiate and enter into covered agreements on behalf of the United States. “(b) Requirements for Consultation With Congress.-- “(1) In general.--Before initiating negotiations to enter into a covered agreement under subsection (a), during such negotiations, and before entering into any such agreement, the Secretary and the United States Trade Representative shall jointly consult with the Committee on Financial Services and the Committee on Ways and Means of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs and the Committee on Finance of the Senate. “(2) Scope.--The consultation described in paragraph (1) shall include consultation with respect to-- “(A) the nature of the agreement; “(B) how and to what extent the agreement will achieve the applicable purposes, policies, priorities, and objectives of section 313 and this section; and “(C) the implementation of the agreement, including the general effect of the agreement on existing State laws.

“(c) Submission and Layover Provisions.--A covered agreement under subsection (a) may enter into force with respect to the United States only if-- “(1) the Secretary and the United States Trade Representative jointly submit to the congressional committees specified in subsection (b)(1), on a day on which both Houses of Congress are in session, a copy of the final legal text of the agreement; and “(2) a period of 90 calendar days beginning on the date on which the copy of the final legal text of the agreement is submitted to the congressional committees under paragraph (1) has expired.”.

(b) Duties of Secretary.--Section 321(a) of title 31, United States Code, is amended-- (1) in paragraph (7), by striking “; and” and inserting a semicolon; (2) in paragraph (8)(C), by striking the period at the end and inserting “; and”; and (3) by adding at the end the following new paragraph:
“(9) advise the President on major domestic and international prudential policy issues in connection with all lines of insurance except health insurance.”.

(c) Clerical Amendment.--The table of sections for subchapter I of
chapter 3 of title 31, United States Code, is amended by striking the
item relating to section 312 and inserting the following new items:

“Sec. 312. Terrorism and financial intelligence. “Sec. 313. Federal Insurance Office.

“Sec. 314. Covered agreements.
“Sec. 315. Continuing in office.”.

Subtitle B--State-Based Insurance Reform SEC. 511. SHORT TITLE.

This subtitle may be cited as the “Nonadmitted and Reinsurance Reform Act of 2010”. SEC. 512. EFFECTIVE DATE.

Except as otherwise specifically provided in this subtitle, this subtitle shall take effect upon the expiration of the 12-month period beginning on the date of the enactment of this subtitle.

PART I--NONADMITTED INSURANCE

SEC. 521. REPORTING, PAYMENT, AND ALLOCATION OF PREMIUM TAXES.

(a) Home State's Exclusive Authority.--No State other than the home State of an insured may require any premium tax payment for nonadmitted insurance. (b) Allocation of Nonadmitted Premium Taxes.-- (1) In general.--The States may enter into a compact or otherwise establish procedures to allocate among the States the premium taxes paid to an insured's home State described in subsection (a). (2) Effective date.--Except as expressly otherwise provided in such compact or other procedures, any such compact or other procedures-- (A) if adopted on or before the expiration of the 330-day period that begins on the date of the enactment of this subtitle, shall apply to any premium taxes that, on or after such date of enactment, are required to be paid to any State that is subject to such compact or procedures; and (B) if adopted after the expiration of such 330-day period, shall apply to any premium taxes that, on or after January 1 of the first calendar year that begins after the expiration of such 330-day period, are required to be paid to any State that is subject to such compact or procedures. (3) Report.--Upon the expiration of the 330-day period referred to in paragraph (2), the NAIC may submit a report to the Committee on Financial Services and the Committee on the Judiciary of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate identifying and describing any compact or other procedures for allocation among the States of premium taxes that have been adopted during such period by any States. (4) Nationwide system.--The Congress intends that each State adopt nationwide uniform requirements, forms, and procedures, such as an interstate compact, that provide for the reporting, payment, collection, and allocation of premium taxes for nonadmitted insurance consistent with this section.

(c) Allocation Based on Tax Allocation Report.--To facilitate the payment of premium taxes among the States, an insured's home State may require surplus lines brokers and insureds who

have independently procured insurance to annually file tax allocation reports with the insured's home State detailing the portion of the nonadmitted insurance policy premium or premiums attributable to properties, risks, or exposures located in each State. The filing of a nonadmitted insurance tax allocation report and the payment of tax may be made by a person authorized by the insured to act as its agent. SEC. 522. REGULATION OF NONADMITTED INSURANCE BY INSURED'S HOME STATE.

(a) Home State Authority.--Except as otherwise provided in this
section, the placement of nonadmitted insurance shall be subject to the
statutory and regulatory requirements solely of the insured's home State. (b) Broker Licensing.--No State other than an insured's home State may require a surplus lines broker to be licensed in order to sell, solicit, or negotiate nonadmitted insurance with respect to such insured. (c) Enforcement Provision.--With respect to section 521 and subsections (a) and (b) of this section, any law, regulation, provision, or action of any State that applies or purports to apply to nonadmitted insurance sold to, solicited by, or negotiated with an insured whose home State is another State shall be preempted with respect to such application. (d) Workers' Compensation Exception.--This section may not be construed to preempt any State law, rule, or regulation that restricts the placement of workers' compensation insurance or excess insurance for self-funded workers' compensation plans with a nonadmitted insurer. SEC. 523. PARTICIPATION IN NATIONAL PRODUCER DATABASE.

After the expiration of the 2-year period beginning on the date of the enactment of this subtitle, a State may not collect any fees relating to licensing of an individual or entity as a surplus lines broker in the State unless the State has in effect at such time laws or regulations that provide for participation by the State in the national insurance producer database of the NAIC, or any other equivalent uniform national database, for the licensure of surplus lines brokers and the renewal of such licenses. SEC. 524. UNIFORM STANDARDS FOR SURPLUS LINES ELIGIBILITY.

A State may not--
(1) impose eligibility requirements on, or otherwise establish eligibility criteria for, nonadmitted insurers domiciled in a United States jurisdiction, except in conformance with such requirements and criteria in sections 5A(2) and 5C(2)(a) of the Non-Admitted Insurance Model Act, unless the State has adopted nationwide uniform requirements, forms, and procedures developed in accordance with section 521(b) of this subtitle that include alternative nationwide uniform eligibility requirements; or (2) prohibit a surplus lines broker from placing nonadmitted insurance with, or procuring nonadmitted insurance from, a nonadmitted insurer domiciled outside the United States that is listed on the Quarterly Listing of Alien Insurers maintained by the International Insurers Department of the NAIC.

SEC. 525. STREAMLINED APPLICATION FOR COMMERCIAL PURCHASERS.

A surplus lines broker seeking to procure or place nonadmitted insurance in a State for an exempt commercial purchaser shall not be required to satisfy any State requirement to make a due diligence search to determine whether the full amount or type of insurance sought by such exempt commercial purchaser can be obtained from admitted insurers if-- (1) the broker procuring or placing the surplus lines insurance has disclosed to the exempt commercial purchaser that such insurance may or may not be available from the admitted market that may provide greater protection with more regulatory oversight; and (2) the exempt commercial purchaser has subsequently requested in writing the broker to procure or place such insurance from a nonadmitted insurer. SEC. 526. GAO STUDY OF NONADMITTED INSURANCE MARKET.

(a) In General.--The Comptroller General of the United States shall conduct a study of the nonadmitted insurance market to determine the effect of the enactment of this part on the size and market share of the nonadmitted insurance market for providing coverage typically provided by the admitted insurance market. (b) Contents.--The study shall determine and analyze-- (1) the change in the size and market share of the nonadmitted insurance market and in the number of insurance companies and insurance holding companies providing such business in the 18-month period that begins upon the effective date of this subtitle; (2) the extent to which insurance coverage typically provided by the admitted insurance market has shifted to the nonadmitted insurance market; (3) the consequences of any change in the size and market share of the nonadmitted insurance market, including differences in the price and availability of coverage available in both the admitted and nonadmitted insurance markets; (4) the extent to which insurance companies and insurance holding companies that provide both admitted and nonadmitted insurance have experienced shifts in the volume of business between admitted and nonadmitted insurance; and (5) the extent to which there has been a change in the number of individuals who have nonadmitted insurance policies, the type of coverage provided under such policies, and whether such coverage is available in the admitted insurance market.

(c) Consultation With NAIC.--In conducting the study under this
section, the Comptroller General shall consult with the NAIC.
(d) Report.--The Comptroller General shall complete the study under this section and submit a report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives regarding the findings of the study not later than 30 months after the effective date of this subtitle. SEC. 527. DEFINITIONS.

For purposes of this part, the following definitions shall apply: