Economic Growth and Regulatory Paperwork Reduction Act of 1995

Summary

TABLE OF CONTENTS: Title I: Reductions in Government Overregulation Subtitle A: The Home Mortgage Process Subtitle B: Amendments to the Community Reinvestment Act of 1977 Subtitle C: Payment of Interest Act Title II: Streamlining Government Regulation Subtitle A: Eliminating Unnecessary Regulatory Requirements and Procedures Subtitle B: Eliminating Unnecessary Costs and Paperwork Burdens Subtitle C: Eliminating Unnecessary Reporting Requirements Subtitle D: Regulatory Micromanagement Title III: Regulatory Impact on Cost of Credit and Credit Availability Subtitle A: Lowering Compliance Costs to Promote Credit Availability Subtitle B: Disincentives to Risk-Taking Subtitle C: Miscellaneous Nonsupervisory Reforms Economic Growth and Regulatory Paperwork Reduction Act of 1995 - Title I: Reductions in Government Overregulation - Subtitle A: The Home Mortgage Process - Part I: Regulatory Simplification and Uniformity - Amends the Truth in Lending Act (TLA) and the Real Estate Settlement Procedures Act (RESPA) to require the Board of Governors of the Federal Reserve System (the Board) to: (1) eliminate, modify, or simplify disclosure requirements if such action results in uniformity with other statutory disclosure requirements relating to credit transactions; and (2) proscribe imposition of any disclosure requirement unless its effect is to eliminate, modify, or simplify any disclosure required under this Act. (Sec. 103) Exempts from TLA disclosure requirements transactions that the Board determines: (1) are not necessary to effectuate its purposes; or (2) do not provide a measurable benefit in the form of useful information or consumer protection. (Sec. 104) Amends RESPA to repeal requirements that: (1) a federally related mortgage lender disclose to a mortgage loan applicant the servicing of any such mortgages the lender has assigned, sold or transferred during the most recent three calendar years; and (2) a lender that does not service federally related loans similarly disclose any intention to assign, sell or transfer such servicing. Repeals the mandate for model disclosure statements. Excises from the definition of "federally related mortgage loan" any loan secured by a subordinate lien on residential real property (thereby removing second mortgages from RESPA requirements). Directs the Board to ensure that regulations pertaining to the business credit exemption from RESPA jurisdiction include all business credit exempted from the TLA. Part II: Clarifications to Reduce Costs and Regulatory Burdens - Amends the TLA to exempt from its disclosure requirements any credit transactions involving consumers with an annual earned income of more than $200,000 or having net assets in excess of $1,000,000 at the time of the transaction. (Sec. 112) Revises disclosure requirements for adjustable rate home mortgages to permit as an alternative to the currently required table illustration, a statement that a monthly payment may increase or decrease significantly due to annual percentage rate increases. Grants creditors the option of disclosing, in any variable interest rate residential mortgage transaction that is not an open end credit plan, either a statement that the monthly payment may change substantially, or an historical example illustrating the effects of interest rate changes implemented according to the loan program. (Sec. 113) Excludes from the determination of the finance charge for any consumer credit transaction fees imposed by third party closing agents (including settlement agents, attorneys, escrow and title companies) that are neither expressly required nor retained by the creditor (thereby exempting such amounts from TLA disclosure requirements). Exempts from the computation of a finance charge, if they are otherwise itemized and disclosed, certain: (1) taxes on security instruments or evidences of indebtedness; and (2) fees for preparation of loan-related documents and attending or conducting settlement. (Sec. 114) Exempts from the right of rescission certain refinancings or consolidations of debt that are secured by a lien on a consumer's principal dwelling. (Sec. 115) Permits finance charge disclosures for certain consumer credit transactions secured by real property or a dwelling to vary within an accuracy tolerance range of $100. Sets guidelines for per diem interest rate disclosures consumer credit transactions. (Sec. 116) Shields a creditor or assignee from liability in connection with disclosures of: (1) certain fees and charges; and (2) finance charges that fall within certain statutory tolerance limits. (Sec. 117) Modifies the guidelines delimiting an obligor's period of rescission to preclude a consumer from asserting rescission in any action after the earlier of: (1) expiration of the three-year period beginning on the transaction consummation date; or (2) the date of the sale of the property securing an extension of credit. (Sec. 118) Modifies assignee liability guidelines to provide that a violation is apparent on the face of the disclosure statement if the disclosure does not use the format required by law. Prescribes guidelines under which the servicer of a consumer obligation arising from a consumer credit transaction shall not be treated as the assignee of such obligation. (Sec. 119) Repeals the bona fide personal financial emergency condition placed upon exercise of the Board's authority to modify or waive rescission rights arising from a consumer credit transaction. Subtitle B: Amendments to the Community Reinvestment Act of 1977 - Amends the Community Reinvestment Act of 1977 (CRA) to prohibit the appropriate Federal regulatory agency, in the course of examining a financial institution, from imposing recordkeeping or reporting requirements that do not have the effect of eliminating, streamlining, or reducing regulatory burdens upon such institution. (Sec. 132) Exempts small-sized banks with total assets under $250 million from CRA jurisdiction. (Sec. 133) Prescribes guidelines under which each appropriate Federal regulatory agency shall: (1) publish its examination schedule; and (2) provide opportunity for community comment. Authorizes the agency to reconsider, upon request, the rating of an institution. (Sec. 134) Defines a "special purpose bank" as one that does not generally accept deposits from the public in amounts less than $100,000, such as a credit card bank or a trust bank. Mandates that, in assessing the record of special purpose banks in meeting community credit needs, the appropriate Federal regulatory agency: (1) take into consideration the nature of the businesses of such banks; and (2) develop standards under which they may be deemed to comply with CRA requirements consistent with the specific nature of such businesses. Requires the agency, in assessing any financial institution, to give positive consideration to investments and loans made by such institutions that provide benefits to distressed communities, regardless of whether or not the communities are located within the service area of the financial institution. Subtitle C: Payment of Interest Act - Amends the Federal Deposit Insurance Corporation Improvement Act of 1991 to retitle the Truth in Savings Act as the "Payment of Interest Act". Repeals: (1) the finding of the Congress that uniform disclosure of interest and fees charged on consumer deposit accounts strengthens consumer ability to make informed decisions and verify deposit accounts; and (2) the stated purpose of the Truth in Savings Act requiring clear, uniform disclosure of interest rates payable on deposit accounts and the fees assessable against them. Declares instead that: (1) the Truth in Savings Act created unnecessary paperwork, compliance, and liability burdens for depository institutions without enhancing consumer ability to make informed decisions; and (2) the purpose of the Payment of Interest Act is to repeal unnecessary disclosure requirements while retaining the requirement that interest be paid on the full amount of principal in the account for each day of the stated calculation period at the interest rate disclosed by the depository institution. Repeals: (1) the uniform disclosure requirements for interest rates and fees, including annual percentage yields, minimum account and time requirements, and interest penalties; and (2) the proscription against misleading descriptions of free or no-cost accounts, and misleading or inaccurate advertisements. Repeals current law that a depository institution: (1) maintain and distribute a schedule of fees, interest rates, and account restrictions written in readily understood format for each class of accounts being offered; (2) notify account holders of any changes in the schedule; and (3) clearly and conspicuously disclose with each periodic statement to account holders the annual percentage yield earned, the amount of interest earned, the amount of fees or charges imposed, and the number of days in the reporting period. Repeals civil liability guidelines governing class actions. Modifies depository institution liability regarding: (1) notification and adjustment for errors; and (2) continuing and subsequent depository institution failure to pay interest. Title II: Streamlining Government Regulation - Subtitle A: Eliminating Unnecessary Regulatory Requirements and Procedures - Amends the Bank Holding Company Act of 1956 (BHCA) to set forth financial and managerial criteria under which an acquisition of shares by a bank holding company, or a merger or consolidation between registered bank holding companies, shall be deemed to be approved. (Current law requires prior Board approval). (Sec. 202) Amends the Federal Deposit Insurance Act (FDIA) to set forth conditions under which prior approval is not required for any merger, consolidation, asset acquisition, or liabilities assumption, involving only insured depository institutions subsidiaries of the same depository institution holding company. (Sec. 203) Permits any insured depository institution to participate in optional conversion transactions between members of the Bank Insurance Fund and the Savings Association Insurance Fund without the prior written approval of the responsible agency. Repeals: (1) agency guidelines for approval; and (2) the prohibition against transactions which result in the transfer from one Federal deposit insurance fund to the other. Makes the sole criterion for authorization of a conversion transaction without approval that the acquiring, assuming, or resulting depository institution will meet all applicable capital requirements upon consummation of the transaction. (Sec. 204) Amends the Revised Statutes, the Federal Reserve Act (FRA), and the FDIA to delineate conditions under which prior approval is not required for banks under their purview to establish and operate a branch or seasonal agency. (Sec. 205) Amends the Home Owners' Loan Act to remove from its regulatory purview a bank holding company subject to the BHCA. Revises the definition of "savings and loan holding company" to exclude a bank holding company under BHCA jurisdiction. Provides that acquisition of a savings association by a bank holding company under BHCA jurisdiction obviates approval by the Director of the Office of Thrift Supervision. (Sec. 206) Amends the Revised Statutes to repeal the aggregate minimum capital requirements imposed upon a national banking association and its branches. (Sec. 207) Amends the Revised Statutes and the FDIA to exclude from the definition of "branch" an automated teller machine or remote service unit (thus exempting those entities from the approval requirements of such Acts). (Sec. 208) Amends the FRA to prescribe regulatory approval guidelines for investments in bank premises by well capitalized and well managed banks. (Sec. 209) Amends the BHCA to repeal the provision that shares transferred by a bank holding company to a transferee under its control are deemed to be under the holding company's control (thus subject to specified approval requirements). (Sec. 210) Amends the FDIA to repeal the requirement that the appropriate Federal banking agency be notified prior to the appointment or addition of a new director or senior executive officer if the affected insured depository institution or depository institution holding company: (1) has been chartered less than two years; or (2) has undergone a change in control within the preceding two years. Retains such prior notice requirement for troubled insured depository institutions or depository institution holding companies only if the agency determines that prior notice is appropriate. Extends from 30 days up to 90 days the period during which, following notice, the agency may disapprove board of directors or senior executive officer appointments by such institutions or companies. (Sec. 211) Amends the Depository Institutions Management Interlocks Act to revise the prohibition on dual service of management officials to raise the asset-size thresholds of the depository institutions or depository holding companies to which the prohibition applies. Authorizes Federal banking regulatory agencies to adjust such thresholds for inflation. Repeals the 20-year exemption from the dual service prohibition for certain grandfathered directors and management officials (thus permitting them to continue their dual service permanently). Repeals the requirement that each appropriate Federal depository institutions regulatory agency: (1) review according to prescribed criteria the petition of a management official to serve in more than one position (interlocking directorate); and (2) determine whether continuation of such dual service produces an anti-competitive effect. Repeals the criteria governing regulatory approval of management interlocks. (Sec. 212) Amends the FRA to exempt from its proscription against preferential terms in credit extensions to executive officers, directors, or principal shareholders (insider lending) any credit extensions made pursuant to a benefit or compensation program widely available to employees of the member bank. Includes such credit extensions in the Board's authority to waive the proscription against such preferential terms for certain executive officers and directors of controlling nonbank affiliates. Repeals the reporting requirement that: (1) an executive officer of a member bank indebted to another bank submit a written report of such debt to the member bank's board of directors; and (2) a member bank include in its statutory condition of report all loans made since its previous report. Amends the FDIA to repeal Federal banking agency authority to require banks to disclose credit extensions made to their executive officers or principal shareholders. Amends the Bank Holding Company Act Amendments of 1970 to repeal the requirement that bank executive officers and stockholders who own more than a ten percent controlling interest report to the bank's board of directors regarding any credit extensions made to them by a bank maintaining a correspondent account. (Sec. 213) Amends the Federal Financial Institutions Examination Council Act of 1978 to abolish the Appraisal Subcommittee. Amends the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 to transfer the functions of the Appraisal Subcommittee to the Federal Financial Institutions Examination Council. (Sec. 214) Amends the FDIA to exclude automated teller machines and specified bank branches from the definition of "banking branch" (thus exempting them from Federal bank closure notification requirements). Makes such exemption retroactive to the effective date of the Federal Deposit Insurance Corporation Improvement Act of 1991. (Sec. 215) Amends the International Banking Act of 1978 to replace the Board's authority to order a foreign bank to terminate its branch activities in the United States with authority to recommend to the appropriate Federal or State bank official that such branch's license be terminated. Revises the examination guidelines for foreign banks to: (1) direct the Board to rely upon reports of examinations made by the Comptroller of the Currency, the Federal Deposit Insurance Corporation (FDIC), and State bank supervisors (currently the Board coordinates such examinations); and (2) subject a foreign bank to the same on-site examination schedules and cost-of-examination assessments as are imposed upon U.S. banks. Modifies procedural guidelines for Board review of foreign bank applications to establish a U.S. presence. Subtitle B: Eliminating Unnecessary Costs and Paperwork Burdens - Amends the FDIA to: (1) expand from 18 months to 24 months the discretionary timeframe for mandatory on-site examinations of certain small-sized depository institutions; and (2) increase from $175 million to $250 million the asset-size ceiling on the meaning of "small depository institution" which Federal banking agencies may in their discretion determine for examination purposes. (Sec. 222) Amends the Right to Financial Privacy Act to require a Government authority to reimburse a financial institution for assembling or providing financial records pertaining to corporate customers. (Sec. 223) Directs the Federal Financial Institutions Examinations Council, and each Federal banking agency represented on it, to review and report to the Congress on Federal banking regulations at least every ten years to identify unnecessary regulatory requirements imposed upon insured depository institutions.Requires the Council or the pertinent banking agency to eliminate unnecessary regulations to the extent appropriate. Subtitle C: Eliminating Unnecessary Reporting Requirements - Amends the Community Reinvestment Act of 1977 (CRA) to prohibit the imposition upon financial institutions of: (1) recordkeeping requirements that do not result in eliminating, streamlining or reducing regulatory burdens upon the institutions; or (2) loan data collection and reporting requirements. Prohibits public disclosure of loan data by any Federal financial supervisory agency. (Sec. 232) Amends the Federal Home Loan Bank Act (FHLBA) to exempt financial institutions meeting specified criteria from its community support requirements. (Sec. 233) Amends Federal monetary law to: (1) reduce mandatory identification procedures for monetary transactions; and (2) repeal identification reporting requirements regarding certain financial institution customers of depository institutions. (Sec. 235) Amends the Federal Deposit Insurance Corporation Improvement Act of 1991 to repeal the mandate that: (1) insured depository institutions include information on small businesses and small farm lending in their annual reports of condition; and (2) the Board publish annually information on credit availability to small businesses. (Sec. 236) Amends the Home Mortgage Disclosure Act of 1975 to increase from $10 million to $50 million the maximum asset-size of institutions exempt from its purview. Authorizes the Board to exempt from the Act's disclosure requirements institutions whose asset-size is at least $50,000000 if the burden of compliance outweighs the usefulness of the requisite information. Declares that a depository institution shall be deemed to have satisfied the public availability requirements with respect to its mortgage loan transactions if its branch offices provide notice of the availability upon request of such information from the home office. (Sec. 237) Amends FDIA guidelines governing a change in control of insured depository institutions to repeal mandatory reporting by financial institutions (or affiliates) of any loans secured by 25 percent or more of any class of shares of an insured depository institution (stock loans). Subtitle D: Regulatory Micromanagement - Amends the Revised Statutes regarding national banking association director qualifications to extend to all such associations the Comptroller of the Currency's authority to waive citizenship requirements for a minority of the association's directors. Allows the Comptroller to waive State residency requirements. (Sec. 242) Sets a deadline by which each Federal banking agency and the National Credit Union Administration Board must eliminate regulations which require insured depository institutions and credit unions to produce unnecessary internal written policies. (Sec. 243) Amends the FDIA to increase the number of members of the FDIC Board of Directors from five to six. Mandates that one director be appointed from among individuals serving as State bank commissioners or supervisors. Limits such appointment to a single two-year term served without compensation. Limits eligibility to serve as Chairperson or Vice Chairperson of the FDIC Board to residentially appointed directors. Title III: Regulatory Impact on Cost of Credit and Credit Availability - Subtitle A: Lowering Compliance Costs to Promote Credit Availability - Amends FDIA guidelines for improved accountability in financial management to: (1) eliminate the use of an independent public accountant to detect and report violations of law by an insured depository institution or depository institution holding company; (2) alter independent audit committee composition from one composed entirely of outside directors independent of institution management, to one composed of a majority of such independent directors; and (3) require each appropriate Federal banking agency to exempt from the independent audit committee requirement any insured depository institution that has encountered hardships in retaining competent directors on such committee. (Sec. 302) Amends the Equal Credit Opportunity Act and the Fair Housing Act to prohibit an enforcing agency from acquiring or using reports generated by any creditor-conducted review of lending operations to determine compliance with such Acts (thereby encouraging creditors to self-test for compliance with the Acts). (Sec. 303) Amends the Home Owners' Loan Act to revise the exemption from certain non-qualified thrift lender restrictions of specialized savings associations serving transient military personnel to repeal a specified requirement with respect to the association's savings and loan holding company. (Sec. 304) Repeals Federal savings association (association) authority to issue credit cards or engage in credit card operations. Permits an association to deal in credit card loans or education loans without being subject to a percentage-of-assets limitation. Raises from ten percent to 20 percent the percentage-of-assets-limitations ceiling placed upon commercial and agricultural loans offered by an association. Restricts loan amounts exceeding ten percent of an association's total assets to loans made to small businesses. Repeals the five-percent-of-assets loan restriction upon education loans offered by an association. Expands the scope of "qualified thrift lender" to include a domestic building and loan association. Redefines "qualified thrift investment" to cover, as assets includible without limit, educational loans, small business loans, and loans made through credit cards or credit card accounts. Removes the ten-percent-of-assets loan restriction placed upon certain personal, family, household or education loans. (Sec. 305) Amends the FRA, with respect to regulations governing payment system risk or intraday credit, to: (1) require them to include net debit caps appropriate to the credit quality of each Federal Home Loan (FHL) Bank (together with normal fees for daylight overdrafts); or (2) exempt FHL Banks from such regulations. (Sec. 306) Amends the FHLBA to: (1) revise the location requirements for FHL Banks to provide for membership-based-on-convenience; (2) mandate that the FHL Banks contract annually for an annual audit with a single auditor; and (3) preclude the Board from participation in any audit or audit contracting process (other than to establish contract and accounting requirements). (Sec. 308) Amends the BHCA to lift the growth cap restrictions placed upon banks controlled by certain bank holding companies not statutorily treated as bank holding companies. Subtitle B: Disincentives to Risk-Taking - Amends the FDIA and the Federal Credit Union Act to: (1) reinstate the requirement of a showing of irreparable and immediate harm as a prerequisite to attachment of assets and other injunctive relief when the FDIC or the National Credit Union Administration Board acts as conservator or receiver; and (2) confer oversight authority to prohibit removal of assets in cease and desist proceedings if it results in immediate and irreparable harm. Subtitle C: Miscellaneous Nonsupervisory Reforms - Amends the TLA to hold a cardholder liable for unauthorized use of a credit card if the liability exceeds $50 and the cardholder fails to timely notify the card issuer of any unauthorized transaction that appears on the account statement. Amends the Electronic Fund Transfer Act to raise from $50 to $500 a cardholder's liability for unauthorized electronic fund transfers if the cardholder substantially contributed to the unauthorized transfer, including writing on or keeping with the card or other means of access a personal identification or other security code.

This text is taken from the official record. PoliticalRepo does not editorialize.

Timeline

No timeline events have been ingested for this record yet.

Votes

No vote records are attached yet.

Versions

No version snapshots stored. Document URLs remain at the source.

Documents

6 official files

• Reported to Senate (text)

  Reported to Senate · EN · 14 December 1995

  ViewDownloadOpen at official source

• Reported to Senate (PDF)

  Reported to Senate · EN · 14 December 1995

  ViewDownloadOpen at official source

• Reported to Senate with amendment(s)

  summary · EN · 14 December 1995

  Open at official source

• Introduced in Senate (text)

  Introduced in Senate · EN · 30 March 1995

  ViewDownloadOpen at official source

• Introduced in Senate (PDF)

  Introduced in Senate · EN · 30 March 1995

  ViewDownloadOpen at official source

• Introduced in Senate

  summary · EN · 30 March 1995

  Open at official source

Sponsors

No sponsors or actors listed by the source.

Related records

No cross-record relationships stored yet.