Financial Regulatory Relief and Economic Efficiency Act of 1998

Summary

TABLE OF CONTENTS: Title I: Improving Monetary Policy and Financial Institution Management Practices Title II: Streamlining Activities of Institutions Title III: Streamlining Agency Actions Title IV: Disclosure Simplification Title V: Miscellaneous Title VI: Technical Corrections Financial Regulatory Relief and Economic Efficiency Act of 1997 - Title I: Improving Monetary Policy and Financial Institution Management Practices - Amends the Federal Reserve Act (FRA) to permit interest payments on reserves maintained at a Federal reserve bank to meet depository institution reserve requirements. (Sec. 102) Repeals the limitation on the authority of a depository institution to permit the owner of any deposit or account to make withdrawals by negotiable or transferable instruments for transfers to third parties. (Currently, such authority may be applied only with respect to the accounts of charitable, religious, and other nonprofit organizations, as well as to Federal, State, and local governments.) Amends the FRA, the Home Owners' Loan Act (HOLA), and the Federal Deposit Insurance Act (FDIA) to repeal the prohibition against interest or dividend payments on demand deposits. (Sec. 103) Amends HOLA to: (1) repeal savings association liquid asset and dividend notice requirements; (2) provide for examination of savings association companies; (3) repeal certain restrictions on interstate acquisitions that result in the formation of a multiple savings and loan holding company which controls savings and loan associations in more than one State; and (4) permit a savings and loan holding company, with the prior approval by the Director of the Office of Thrift Supervision, to acquire more than five percent of the voting shares of a non-subsidiary savings association or non-subsidiary savings and loan holding company. (Sec. 108) Amends the FDIA to repeal deposit broker notification and recordkeeping requirements. (Sec. 109) Amends the FRA to reserve to the Board of Governors of the Federal Reserve System (the Board) (currently, the appropriate Federal banking agency) the authority to promulgate regulations on extensions of credit to executive officers of member banks. (Sec. 110) Amends the National Bank Consolidation and Merger Act to prescribe expedited procedures permitting a national banking association to: (1) reorganize as either a bank holding company, or as a bank holding company subsidiary; or (2) merge with subsidiaries or nonbank affiliates. (Sec. 111) Amends Federal banking law to increase from one year to three years the term of the national bank director. Amends the Banking Act of 1933 to authorize the Comptroller of the Currency to exempt a national banking association from the 25-member limit on the number of members of an association's governing body. (Sec. 113) Amends Federal banking law and the FDIA to exclude from the prohibition against loans or discounts on the security of the shares of its own capital stock any such loan or discount if a national banking association or depository institution acquires the stock in order to prevent loss upon a debt contracted for in good faith before the discount transaction or loan date. Removes the prohibition against depository institution affiliation with a Government-sponsored enterprise. (Sec. 116) Amends the Bank Holding Company Act of 1956 (BHCA) to: (1) repeal certain cross-marketing restrictions placed upon banks controlled by certain companies that are not treated as bank holding companies; (2) preserve the exemption from bank holding company treatment of certain companies whose limited purpose bank subsidiary may have permitted overdrafts resulting from an inadvertent computer or accounting error beyond the control of both the bank and the affiliate (daylight overdrafts); and (3) authorize actions which specified banks may take to avoid divestiture following loss of exemption from treatment as bank holding companies. (Sec. 118) Amends the FRA to mandate inclusion of net debit caps and daylight overdraft fees (as well as exemption from such caps and fees) within any FRA policy or regulation governing payment system or intraday credit. (Sec. 119) Amends the Federal Home Loan Bank Act (FHLBA) to: (1) repeal the requirement of Board approval for certain internal bank management practices; (2) provide that a Federal Home Loan Bank (FHLB) shall not be required to submit budget, business, or strategic plans to its board of directors for approval; and (3) revise guidelines for secured advances to FHLB members to include federally insured or guaranteed mortgages as collateral eligible for such advances. Title II: Streamlining Activities of Institutions - Amends the HOLA to permit community development investments for the primary purpose of promoting the public welfare, including housing, services, and jobs for low- and moderate-income communities. (Sec. 202) Amends the FDIA to repeal the restriction on the interest rate paid by an adequately- but not well-capitalized insured depository institution, or by an insured depository institution in conservatorship, that accepts deposits from a deposit broker. Applies the prohibition on deposit solicitation to adequately- but not well-capitalized insured depository institutions and insured depository institutions in conservatorship. (Sec. 203) Amends the FRA to terminate the power of the Board to set lending limitations upon member banks' extension of loans that are collateralized by stocks and bonds (thus eliminating the Board's duty to prevent undue use of bank loans for the speculative carrying of securities). (Sec. 204) Amends the Bank Holding Company Act Amendments of 1970 to repeal the prohibition against certain bank tying arrangements in connection with credit, leasing, or property sales transactions. (Sec. 205) Amends the BHCA to permit certain banks and bank holding companies to extend credit card accounts for business purposes, including the issuance of such accounts to small businesses. (Sec. 206) Makes it lawful for a real estate settlement services provider, upon clear disclosure to the consumer, to make payments to an unrelated affinity group in exchange for its endorsement of such provider's services or products. (Sec. 207) Amends the Fair Debt Collection Practices Act to exempt from its coverage: (1) communications involving legal proceedings or made to collect loans under the Higher Education Act of 1965; and (2) bank drafts payable on demand and signed by the maker. (Sec. 208) Amends BHCA to exempt from treatment as a bank holding company any company that acquires control from the Resolution Trust Corporation, the Federal Deposit Insurance Corporation, or the Director of the Office of Thrift Supervision of more than five percent of the shares of an undercapitalized bank, savings association, or other insured institution. (Sec. 209) Revises HOLA guidelines governing reorganization by a mutual savings association into a holding company. (Sec. 210) Mandates that the Federal banking agencies work jointly to develop: (1) electronic filing and public dissemination of depository institution status reports (call reports); and (2) uniform formats as well as simplified filing instructions for such reports. Title III: Streamlining Agency Actions - Amends the Resolution Trust Corporation Completion Act to reduce from four to two times a year the frequency of scheduled meetings of the Affordable Housing Advisory Board. (Sec. 302) Amends the FDIA to: (1) repeal the mandate for Federal banking agencies to jointly develop a method for supplemental disclosures in various required Federal filings of the estimated fair market value of depository institution assets and liabilities; (2) authorize the Federal Deposit Insurance Corporation (FDIC) to establish the interest rate for or make postinsolvency interest payments to creditors holding proven claims against the receivership estates of insured Federal or State depository institutions following satisfaction by the receiver of the principal amount of all creditor claims; and (3) repeal the mandate that Federal banking agencies file annual reports with certain congressional banking committees regarding differing accounting and capital standards used by other agencies. (Sec. 305) Requires the responsible agency, in its review of competitive factors in bank merger filings, to request a report from the Attorney General only (currently, from the Attorney General and the other Federal banking agencies). Amends the BHCA and the FDIA to require the Board and the responsible agency, respectively, before disapproving a bank merger transaction on the grounds of disproportionate anticompetitive effects, to consider specified criteria concerning competitive effects. (Sec. 306) Terminates the Thrift Depositor Protection Oversight Board. Title IV: Disclosure Simplification - Amends the Truth in Lending Act (TILA) disclosure requirements for open end consumer credit plans to permit, as an alternative to the currently required table illustration, a statement at the option of the creditor that periodic payments may increase or decrease substantially. (Sec. 402) Amends specified consumer protection disclosure requirements for advertisements for credit other than open end plans. Sets forth requirements for alternative compliance methods for advertising credit terms. Title V: Miscellaneous - Revises the positions of Board members on the Executive Schedule. (Sec. 502) Prescribes enrollment guidelines for certain enrollees in health plans administered by the Federal banking agencies. (Sec. 503) Amends the FHLBA to eliminate the position of consumer representative from mandatory membership on the board of directors of the Federal Housing Finance Board. Title VI: Technical Corrections - Makes technical corrections to related Acts. (Sec. 603) Amends Federal banking law to: (1) authorize the Comptroller of the Currency to waive the citizenship requirement for a minority of the total number of directors sitting on the board of a national bank; (2) declare it is unlawful for the Comptroller to hold an interest in any national bank; and (3) repeal specified capital and surplus requirements for national banking associations. (Sec. 604) Amends the International Bank Act of 1978 to modify examination requirements pertaining to establishment and operation by a foreign bank of Federal branches and agencies.

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6 official files

• Reported to Senate (text)

  Reported to Senate · EN · 24 September 1998

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• Reported to Senate (PDF)

  Reported to Senate · EN · 24 September 1998

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• Reported to Senate with amendment(s)

  summary · EN · 24 September 1998

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• Introduced in Senate (text)

  Introduced in Senate · EN · 7 November 1997

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• Introduced in Senate (PDF)

  Introduced in Senate · EN · 7 November 1997

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• Introduced in Senate

  summary · EN · 7 November 1997

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