§ 1467a. — Regulation of holding companies.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 12USC1467a]
TITLE 12--BANKS AND BANKING
CHAPTER 12--SAVINGS ASSOCIATIONS
Sec. 1467a. Regulation of holding companies
(a) Definitions
(1) In general
As used in this section, unless the context otherwise requires--
(A) Savings association
The term ``savings association'' includes a savings bank or
cooperative bank which is deemed by the Director to be a savings
association under subsection (l) of this section.
(B) Uninsured institution
The term ``uninsured institution'' means any depository
institution the deposits of which are not insured by the Federal
Deposit Insurance Corporation.
(C) Company
The term ``company'' means any corporation, partnership,
trust, joint-stock company, or similar organization, but does
not include the Federal Deposit Insurance Corporation, the
Resolution Trust Corporation, any Federal home loan bank, or any
company the majority of the shares of which is owned by the
United States or any State, or by an instrumentality of the
United States or any State.
(D) Savings and loan holding company
(i) In general
Except as provided in clause (ii), the term ``savings
and loan holding company'' means any company that directly
or indirectly controls a savings association or that
controls any other company that is a savings and loan
holding company.
(ii) Exclusion
The term ``savings and loan holding company'' does not
include a bank holding company that is registered under, and
subject to, the Bank Holding Company Act of 1956 [12 U.S.C.
1841 et seq.], or to any company directly or indirectly
controlled by such company (other than a savings
association).
(E) Multiple savings and loan holding company
The term ``multiple savings and loan holding company'' means
any savings and loan holding company which directly or
indirectly controls 2 or more savings associations.
(F) Diversified savings and loan holding company
The term ``diversified savings and loan holding company''
means any savings and loan holding company whose subsidiary
savings association and related activities as permitted under
paragraph (2) of subsection (c) of this section represented, on
either an actual or a pro forma basis, less than 50 percent of
its consolidated net worth at the close of its preceding fiscal
year and of its consolidated net earnings for such fiscal year,
as determined in accordance with regulations issued by the
Director.
(G) Subsidiary
The term ``subsidiary'' has the same meaning as in section 3
of the Federal Deposit Insurance Act [12 U.S.C. 1813].
(H) Affiliate
The term ``affiliate'' of a savings association means any
person which controls, is controlled by, or is under common
control with, such savings association.
(I) Bank holding company
The terms ``bank holding company'' and ``bank'' have the
meanings given to such terms in section 2 of the Bank Holding
Company Act of 1956 [12 U.S.C. 1841].
(J) Acquire
The term ``acquire'' has the meaning given to such term in
section 13(f)(8) of the Federal Deposit Insurance Act [12 U.S.C.
1823(f)(8)].
(2) Control
For purposes of this section, a person shall be deemed to have
control of--
(A) a savings association if the person directly or
indirectly or acting in concert with one or more other persons,
or through one or more subsidiaries, owns, controls, or holds
with power to vote, or holds proxies representing, more than 25
percent of the voting shares of such savings association, or
controls in any manner the election of a majority of the
directors of such association;
(B) any other company if the person directly or indirectly
or acting in concert with one or more other persons, or through
one or more subsidiaries, owns, controls, or holds with power to
vote, or holds proxies representing, more than 25 percent of the
voting shares or rights of such other company, or controls in
any manner the election or appointment of a majority of the
directors or trustees of such other company, or is a general
partner in or has contributed more than 25 percent of the
capital of such other company;
(C) a trust if the person is a trustee thereof; or
(D) a savings association or any other company if the
Director determines, after reasonable notice and opportunity for
hearing, that such person directly or indirectly exercises a
controlling influence over the management or policies of such
association or other company.
(3) Exclusions
Notwithstanding any other provision of this subsection, the term
``savings and loan holding company'' does not include--
(A) any company by virtue of its ownership or control of
voting shares of a savings association or a savings and loan
holding company acquired in connection with the underwriting of
securities if such shares are held only for such period of time
(not exceeding 120 days unless extended by the Director) as will
permit the sale thereof on a reasonable basis; and
(B) any trust (other than a pension, profit-sharing,
shareholders', voting, or business trust) which controls a
savings association or a savings and loan holding company if
such trust by its terms must terminate within 25 years or not
later than 21 years and 10 months after the death of individuals
living on the effective date of the trust, and is (i) in
existence on June 26, 1967, or (ii) a testamentary trust created
on or after June 26, 1967.
(4) Special rule relating to qualified stock issuance
No savings and loan holding company shall be deemed to control a
savings association solely by reason of the purchase by such savings
and loan holding company of shares issued by such savings
association, or issued by any savings and loan holding company
(other than a bank holding company) which controls such savings
association, in connection with a qualified stock issuance if such
purchase is approved by the Director under subsection (q)(1)(D) of
this section, unless the acquiring savings and loan holding company,
directly or indirectly, or acting in concert with 1 or more other
persons, or through 1 or more subsidiaries, owns, controls, or holds
with power to vote, or holds proxies representing, more than 15
percent of the voting shares of such savings association or holding
company.
(b) Registration and examination
(1) In general
Within 90 days after becoming a savings and loan holding
company, each savings and loan holding company shall register with
the Director on forms prescribed by the Director, which shall
include such information, under oath or otherwise, with respect to
the financial condition, ownership, operations, management, and
intercompany relationships of such holding company and its
subsidiaries, and related matters, as the Director may deem
necessary or appropriate to carry out the purposes of this section.
Upon application, the Director may extend the time within which a
savings and loan holding company shall register and file the
requisite information.
(2) Reports
Each savings and loan holding company and each subsidiary
thereof, other than a savings association, shall file with the
Director, and the regional office of the Director of the district in
which its principal office is located, such reports as may be
required by the Director. Such reports shall be made under oath or
otherwise, and shall be in such form and for such periods, as the
Director may prescribe. Each report shall contain such information
concerning the operations of such savings and loan holding company
and its subsidiaries as the Director may require.
(3) Books and records
Each savings and loan holding company shall maintain such books
and records as may be prescribed by the Director.
(4) Examinations
Each savings and loan holding company and each subsidiary
thereof (other than a bank) shall be subject to such examinations as
the Director may prescribe. The cost of such examinations shall be
assessed against and paid by such holding company. Examination and
other reports may be furnished by the Director to the appropriate
State supervisory authority. The Director shall, to the extent
deemed feasible, use for the purposes of this subsection reports
filed with or examinations made by other Federal agencies or the
appropriate State supervisory authority.
(5) Agent for service of process
The Director may require any savings and loan holding company,
or persons connected therewith if it is not a corporation, to
execute and file a prescribed form of irrevocable appointment of
agent for service of process.
(6) Release from registration
The Director may at any time, upon the Director's own motion or
upon application, release a registered savings and loan holding
company from any registration theretofore made by such company, if
the Director determines that such company no longer has control of
any savings association.
(c) Holding company activities
(1) Prohibited activities
Except as otherwise provided in this subsection, no savings and
loan holding company and no subsidiary which is not a savings
association shall--
(A) engage in any activity or render any service for or on
behalf of a savings association subsidiary for the purpose or
with the effect of evading any law or regulation applicable to
such savings association;
(B) commence any business activity, other than the
activities described in paragraph (2); or
(C) continue any business activity, other than the
activities described in paragraph (2), after the end of the 2-
year period beginning on the date on which such company received
approval under subsection (e) of this section to become a
savings and loan holding company subject to the limitations
contained in this subparagraph.
(2) Exempt activities
The prohibitions of subparagraphs (B) and (C) of paragraph (1)
shall not apply to the following business activities of any savings
and loan holding company or any subsidiary (of such company) which
is not a savings association:
(A) Furnishing or performing management services for a
savings association subsidiary of such company.
(B) Conducting an insurance agency or escrow business.
(C) Holding, managing, or liquidating assets owned or
acquired from a savings association subsidiary of such company.
(D) Holding or managing properties used or occupied by a
savings association subsidiary of such company.
(E) Acting as trustee under deed of trust.
(F) Any other activity--
(i) which the Board of Governors of the Federal Reserve
System, by regulation, has determined to be permissible for
bank holding companies under section 4(c) of the Bank
Holding Company Act of 1956 [12 U.S.C. 1843(c)], unless the
Director, by regulation, prohibits or limits any such
activity for savings and loan holding companies; or
(ii) in which multiple savings and loan holding
companies were authorized (by regulation) to directly engage
on March 5, 1987.
(G) In the case of a savings and loan holding company,
purchasing, holding, or disposing of stock acquired in
connection with a qualified stock issuance if the purchase of
such stock by such savings and loan holding company is approved
by the Director pursuant to subsection (q)(1)(D) of this
section.
(3) Certain limitations on activities not applicable to
certain holding companies
Notwithstanding paragraphs (4) and (6) of this subsection, the
limitations contained in subparagraphs (B) and (C) of paragraph (1)
shall not apply to any savings and loan holding company (or any
subsidiary of such company) which controls--
(A) only 1 savings association, if the savings association
subsidiary of such company is a qualified thrift lender (as
determined under subsection (m) of this section); or
(B) more than 1 savings association, if--
(i) all, or all but 1, of the savings association
subsidiaries of such company were initially acquired by the
company or by an individual who would be deemed to control
such company if such individual were a company--
(I) pursuant to an acquisition under section 13(c)
or 13(k) of the Federal Deposit Insurance Act [12 U.S.C.
1823(c) or (k)] or section 408(m) \1\ of the National
Housing Act [12 U.S.C. 1730a(m)]; or
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(II) pursuant to an acquisition in which assistance
was continued to a savings association under section
13(i) of the Federal Deposit Insurance Act; and
(ii) all of the savings association subsidiaries of such
company are qualified thrift lenders (as determined under
subsection (m) of this section).
(4) Prior approval of certain new activities required
(A) In general
No savings and loan holding company and no subsidiary which
is not a savings association shall commence, either de novo or
by an acquisition (in whole or in part) of a going concern, any
activity described in paragraph (2)(F)(i) of this subsection
without the prior approval of the Director.
(B) Factors to be considered by Director
In considering any application under subparagraph (A) by any
savings and loan holding company or any subsidiary of any such
company which is not a savings association, the Director shall
consider--
(i) whether the performance of the activity described in
such application by the company or the subsidiary can
reasonably be expected to produce benefits to the public
(such as greater convenience, increased competition, or
gains in efficiency) that outweigh possible adverse effects
of such activity (such as undue concentration of resources,
decreased or unfair competition, conflicts of interest, or
unsound financial practices);
(ii) the managerial resources of the companies involved;
and
(iii) the adequacy of the financial resources, including
capital, of the companies involved.
(C) Director may differentiate between new and ongoing
activities
In prescribing any regulation or considering any application
under this paragraph, the Director may differentiate between
activities commenced de novo and activities commenced by the
acquisition, in whole or in part, of a going concern.
(D) Approval or disapproval by order
The approval or disapproval of any application under this
paragraph by the Director shall be made in an order issued by
the Director containing the reasons for such approval or
disapproval.
(5) Grace period to achieve compliance
If any savings association referred to in paragraph (3) fails to
maintain the status of such association as a qualified thrift
lender, the Director may allow, for good cause shown, any company
that controls such association (or any subsidiary of such company
which is not a savings association) up to 3 years to comply with the
limitations contained in paragraph (1)(C).
(6) Special provisions relating to certain companies
affected by 1987 amendments
(A) Exception to 2-year grace period for achieving compliance
Notwithstanding paragraph (1)(C), any company which received
approval under subsection (e) of this section to acquire control
of a savings association between March 5, 1987, and August 10,
1987, shall not continue any business activity other than an
activity described in paragraph (2) after August 10, 1987.
(B) Exemption for activities lawfully engaged in before March 5,
1987
Notwithstanding paragraph (1)(C) and subject to
subparagraphs (C) and (D), any savings and loan holding company
which received approval, before March 5, 1987, under subsection
(e) of this section to acquire control of a savings association
may engage, directly or through any subsidiary (other than a
savings association subsidiary of such company), in any activity
in which such company or such subsidiary was lawfully engaged on
such date.
(C) Termination of subparagraph (B) exemption
The exemption provided under subparagraph (B) for activities
engaged in by any savings and loan holding company or a
subsidiary of such company (which is not a savings association)
which would otherwise be prohibited under paragraph (1)(C) shall
terminate with respect to such activities of such company or
subsidiary upon the occurrence (after August 10, 1987) of any of
the following:
(i) The savings and loan holding company acquires
control of a bank or an additional savings association
(other than a savings association acquired pursuant to
section 13(c) or 13(k) of the Federal Deposit Insurance Act
[12 U.S.C. 1823(c) or (k)] or section 406(f) or 408(m) \1\
of the National Housing Act [12 U.S.C. 1729(f) or
1730a(m)]).
(ii) Any savings association subsidiary of the savings
and loan holding company fails to qualify as a domestic
building and loan association under section 7701(a)(19) of
the Internal Revenue Code of 1986 [26 U.S.C. 7701(a)(19)].
(iii) The savings and loan holding company engages in
any business activity--
(I) which is not described in paragraph (2); and
(II) in which it was not engaged on March 5, 1987.
(iv) Any savings association subsidiary of the savings
and loan holding company increases the number of locations
from which such savings association conducts business after
March 5, 1987 (other than an increase which occurs in
connection with a transaction under section 13(c) or (k) of
the Federal Deposit Insurance Act or section 408(m) \2\ of
the National Housing Act.
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(v) Any savings association subsidiary of the savings
and loan holding company permits any overdraft (including an
intraday overdraft), or incurs any such overdraft in its
account at a Federal Reserve bank, on behalf of an
affiliate, unless such overdraft is the result of an
inadvertent computer or accounting error that is beyond the
control of both the savings association subsidiary and the
affiliate.
(D) Order by Director to terminate subparagraph (B) activity
Any activity described in subparagraph (B) may also be
terminated by the Director, after opportunity for hearing, if
the Director determines, having due regard for the purposes of
this title,\3\ that such action is necessary to prevent
conflicts of interest or unsound practices or is in the public
interest.
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\3\ So in original. Act June 13, 1933, which is classified to this
chapter, does not contain titles.
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(7) Foreign savings and loan holding company
Notwithstanding any other provision of this section, any savings
and loan holding company organized under the laws of a foreign
country as of June 1, 1984 (including any subsidiary thereof which
is not a savings association), which controls a single savings
association on August 10, 1987, shall not be subject to this
subsection with respect to any activities of such holding company
which are conducted exclusively in a foreign country.
(8) Exemption for bank holding companies
Except for paragraph (1)(A), this subsection shall not apply to
any company that is treated as a bank holding company for purposes
of section 4 of the Bank Holding Company Act of 1956 [12 U.S.C.
1843], or any of its subsidiaries.
(9) Prevention of new affiliations between S&L holding
companies and commercial firms
(A) In general
Notwithstanding paragraph (3), no company may directly or
indirectly, including through any merger, consolidation, or
other type of business combination, acquire control of a savings
association after May 4, 1999, unless the company is engaged,
directly or indirectly (including through a subsidiary other
than a savings association), only in activities that are
permitted--
(i) under paragraph (1)(C) or (2) of this subsection; or
(ii) for financial holding companies under section 4(k)
of the Bank Holding Company Act of 1956 [12 U.S.C. 1843(k)].
(B) Prevention of new commercial affiliations
Notwithstanding paragraph (3), no savings and loan holding
company may engage directly or indirectly (including through a
subsidiary other than a savings association) in any activity
other than as described in clauses (i) and (ii) of subparagraph
(A).
(C) Preservation of authority of existing unitary S&L holding
companies
Subparagraphs (A) and (B) do not apply with respect to any
company that was a savings and loan holding company on May 4,
1999, or that becomes a savings and loan holding company
pursuant to an application pending before the Office on or
before that date, and that--
(i) meets and continues to meet the requirements of
paragraph (3); and
(ii) continues to control not fewer than 1 savings
association that it controlled on May 4, 1999, or that it
acquired pursuant to an application pending before the
Office on or before that date, or the successor to such
savings association.
(D) Corporate reorganizations permitted
This paragraph does not prevent a transaction that--
(i) involves solely a company under common control with
a savings and loan holding company from acquiring, directly
or indirectly, control of the savings and loan holding
company or any savings association that is already a
subsidiary of the savings and loan holding company; or
(ii) involves solely a merger, consolidation, or other
type of business combination as a result of which a company
under common control with the savings and loan holding
company acquires, directly or indirectly, control of the
savings and loan holding company or any savings association
that is already a subsidiary of the savings and loan holding
company.
(E) Authority to prevent evasions
The Director may issue interpretations, regulations, or
orders that the Director determines necessary to administer and
carry out the purpose and prevent evasions of this paragraph,
including a determination that, notwithstanding the form of a
transaction, the transaction would in substance result in a
company acquiring control of a savings association.
(F) Preservation of authority for family trusts
Subparagraphs (A) and (B) do not apply with respect to any
trust that becomes a savings and loan holding company with
respect to a savings association, if--
(i) not less than 85 percent of the beneficial ownership
interests in the trust are continuously owned, directly or
indirectly, by or for the benefit of members of the same
family, or their spouses, who are lineal descendants of
common ancestors who controlled, directly or indirectly,
such savings association on May 4, 1999, or a subsequent
date, pursuant to an application pending before the Office
on or before May 4, 1999; and
(ii) at the time at which such trust becomes a savings
and loan holding company, such ancestors or lineal
descendants, or spouses of such descendants, have directly
or indirectly controlled the savings association
continuously since May 4, 1999, or a subsequent date,
pursuant to an application pending before the Office on or
before May 4, 1999.
(d) Transactions with affiliates
Transactions between any subsidiary savings association of a savings
and loan holding company and any affiliate (of such savings association
subsidiary) shall be subject to the limitations and prohibitions
specified in section 1468 of this title.
(e) Acquisitions
(1) In general
It shall be unlawful for--
(A) any savings and loan holding company directly or
indirectly, or through one or more subsidiaries or through one
or more transactions--
(i) to acquire, except with the prior written approval
of the Director, the control of a savings association or a
savings and loan holding company, or to retain the control
of such an association or holding company acquired or
retained in violation of this section as heretofore or
hereafter in effect;
(ii) to acquire, except with the prior written approval
of the Director, by the process of merger, consolidation, or
purchase of assets, another savings association or a savings
and loan holding company, or all or substantially all of the
assets of any such association or holding company;
(iii) to acquire, by purchase or otherwise, or to
retain, except with the prior written approval of the
Director, more than 5 percent of the voting shares of a
savings association not a subsidiary, or of a savings and
loan holding company not a subsidiary, or in the case of a
multiple savings and loan holding company (other than a
company described in subsection (c)(8) of this section), to
acquire or retain, and the Director may not authorize
acquisition or retention of, more than 5 percent of the
voting shares of any company not a subsidiary which is
engaged in any business activity other than the activities
specified in subsection (c)(2) of this section. This clause
shall not apply to shares of a savings association or of a
savings and loan holding company--
(I) held as a bona fide fiduciary (whether with or
without the sole discretion to vote such shares);
(II) held temporarily pursuant to an underwriting
commitment in the normal course of an underwriting
business;
(III) held in an account solely for trading
purposes;
(IV) over which no control is held other than
control of voting rights acquired in the normal course
of a proxy solicitation;
(V) acquired in securing or collecting a debt
previously contracted in good faith, during the 2-year
period beginning on the date of such acquisition or for
such additional time (not exceeding 3 years) as the
Director may permit if the Director determines that such
an extension will not be detrimental to the public
interest;
(VI) acquired under section 408(m) \4\ of the
National Housing Act [12 U.S.C. 1730a(m)] or section
13(k) of the Federal Deposit Insurance Act [12 U.S.C.
1823(k)];
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(VII) held by any insurance company, as defined in
section 2(a)(17) of the Investment Company Act of 1940
[15 U.S.C. 80a-2(a)(17)], except as provided in
paragraph (6); or
(VIII) acquired pursuant to a qualified stock
issuance if such purchase is approved by the Director
under subsection (q)(1)(D) of this section;
except that the aggregate amount of shares held under this
clause (other than under subclauses (I), (II), (III), (IV),
and (VI)) may not exceed 15 percent of all outstanding
shares or of the voting power of a savings association or
savings and loan holding company; or
(iv) to acquire the control of an uninsured institution,
or to retain for more than one year after February 14, 1968,
or from the date on which such control was acquired,
whichever is later, except that the Director may upon
application by such company extend such one-year period from
year to year, for an additional period not exceeding 3
years, if the Director finds such extension is warranted and
is not detrimental to the public interest; and
(B) any other company, without the prior written approval of
the Director, directly or indirectly, or through one or more
subsidiaries or through one or more transactions, to acquire the
control of one or more savings associations, except that such
approval shall not be required in connection with the control of
a savings association, (i) acquired by devise under the terms of
a will creating a trust which is excluded from the definition of
``savings and loan holding company'' under subsection (a) of
this section, (ii) acquired in connection with a reorganization
in which a person or group of persons, having had control of a
savings association for more than 3 years, vests control of that
association in a newly formed holding company subject to the
control of the same person or group of persons, or (iii)
acquired by a bank holding company that is registered under, and
subject to, the Bank Holding Company Act of 1956 [12 U.S.C. 1841
et seq.], or any company controlled by such bank holding
company. The Director shall approve an acquisition of a savings
association under this subparagraph unless the Director finds
the financial and managerial resources and future prospects of
the company and association involved to be such that the
acquisition would be detrimental to the association or the
insurance risk of the Savings Association Insurance Fund or Bank
Insurance Fund, and shall render a decision within 90 days after
submission to the Director of the complete record on the
application.
Consideration of the managerial resources of a company or savings
association under subparagraph (B) shall include consideration of
the competence, experience, and integrity of the officers,
directors, and principal shareholders of the company or association.
(2) Factors to be considered
The Director shall not approve any acquisition under
subparagraph (A)(i) or (A)(ii), or of more than one savings
association under subparagraph (B) of paragraph (1) of this
subsection, any acquisition of stock in connection with a qualified
stock issuance, any acquisition under paragraph (4)(A), or any
transaction under section 13(k) of the Federal Deposit Insurance Act
[12 U.S.C. 1823(k)], except in accordance with this paragraph. In
every case, the Director shall take into consideration the financial
and managerial resources and future prospects of the company and
association involved, the effect of the acquisition on the
association, the insurance risk to the Savings Association Insurance
Fund or the Bank Insurance Fund, and the convenience and needs of
the community to be served, and shall render a decision within 90
days after submission to the Director of the complete record on the
application. Consideration of the managerial resources of a company
or savings association shall include consideration of the
competence, experience, and integrity of the officers, directors,
and principal shareholders of the company or association. Before
approving any such acquisition, except a transaction under section
13(k) of the Federal Deposit Insurance Act, the Director shall
request from the Attorney General and consider any report rendered
within 30 days on the competitive factors involved. The Director
shall not approve any proposed acquisition--
(A) which would result in a monopoly, or which would be in
furtherance of any combination or conspiracy to monopolize or to
attempt to monopolize the savings and loan business in any part
of the United States,
(B) the effect of which in any section of the country may be
substantially to lessen competition, or tend to create a
monopoly, or which in any other manner would be in restraint of
trade, unless it finds that the anticompetitive effects of the
proposed acquisition are clearly outweighed in the public
interest by the probable effect of the acquisition in meeting
the convenience and needs of the community to be served,
(C) if the company fails to provide adequate assurances to
the Director that the company will make available to the
Director such information on the operations or activities of the
company, and any affiliate of the company, as the Director
determines to be appropriate to determine and enforce compliance
with this chapter, or
(D) in the case of an application involving a foreign bank,
if the foreign bank is not subject to comprehensive supervision
or regulation on a consolidated basis by the appropriate
authorities in the bank's home country.
(3) Interstate acquisitions
No acquisition shall be approved by the Director under this
subsection which will result in the formation by any company,
through one or more subsidiaries or through one or more
transactions, of a multiple savings and loan holding company
controlling savings associations in more than one State, unless--
(A) such company, or a savings association subsidiary of
such company, is authorized to acquire control of a savings
association subsidiary, or to operate a home or branch office,
in the additional State or States pursuant to section 13(k) of
the Federal Deposit Insurance Act [12 U.S.C. 1823(k)];
(B) such company controls a savings association subsidiary
which operated a home or branch office in the additional State
or States as of March 5, 1987; or
(C) the statutes of the State in which the savings
association to be acquired is located permit a savings
association chartered by such State to be acquired by a savings
association chartered by the State where the acquiring savings
association or savings and loan holding company is located or by
a holding company that controls such a State chartered savings
association, and such statutes specifically authorize such an
acquisition by language to that effect and not merely by
implication.
(4) Acquisitions by certain individuals
(A) In general
Notwithstanding subsection (h)(2) of this section, any
director or officer of a savings and loan holding company, or
any individual who owns, controls, or holds with power to vote
(or holds proxies representing) more than 25 percent of the
voting shares of such holding company, may acquire control of
any savings association not a subsidiary of such savings and
loan holding company with the prior written approval of the
Director.
(B) Treatment of certain holding companies
If any individual referred to in subparagraph (A) controls
more than 1 savings and loan holding company or more than 1
savings association, any savings and loan holding company
controlled by such individual shall be subject to the activities
limitations contained in subsection (c) of this section to the
same extent such limitations apply to multiple savings and loan
holding companies, unless all or all but 1 of the savings
associations (including any institution deemed to be a savings
association under subsection (1) \5\ of this section) controlled
directly or indirectly by such individual was acquired pursuant
to an acquisition described in subclause (I) or (II) of
subsection (c)(3)(B)(i) of this section.
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\5\ So in original. Probably should be subsection ``(l)''.
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(5) Acquisitions pursuant to certain security interests
This subsection and subsection (c)(2) of this section do not
apply to any savings and loan holding company which acquired the
control of a savings association or of a savings and loan holding
company pursuant to a pledge or hypothecation to secure a loan, or
in connection with the liquidation of a loan, made in the ordinary
course of business. It shall be unlawful for any such company to
retain such control for more than one year after February 14, 1968,
or from the date on which such control was acquired, whichever is
later, except that the Director may upon application by such company
extend such one-year period from year to year, for an additional
period not exceeding 3 years, if the Director finds such extension
is warranted and would not be detrimental to the public interest.
(6) Shares held by insurance affiliates
Shares described in clause (iii)(VII) of paragraph (1)(A) shall
not be excluded for purposes of clause (iii) of such paragraph if--
(A) all shares held under such clause (iii)(VII) by all
insurance company affiliates of such savings association or
savings and loan holding company in the aggregate exceed 5
percent of all outstanding shares or of the voting power of the
savings association or savings and loan holding company; or
(B) such shares are acquired or retained with a view to
acquiring, exercising, or transferring control of the savings
association or savings and loan holding company.
(f) Declaration of dividend
Every subsidiary savings association of a savings and loan holding
company shall give the Director not less than 30 days' advance notice of
the proposed declaration by its directors of any dividend on its
guaranty, permanent, or other nonwithdrawable stock. Such notice period
shall commence to run from the date of receipt of such notice by the
Director. Any such dividend declared within such period, or without the
giving of such notice to the Director, shall be invalid and shall confer
no rights or benefits upon the holder of any such stock.
(g) Administration and enforcement
(1) In general
The Director is authorized to issue such regulations and orders
as the Director deems necessary or appropriate to enable the
Director to administer and carry out the purposes of this section,
and to require compliance therewith and prevent evasions thereof.
(2) Investigations
The Director may make such investigations as the Director deems
necessary or appropriate to determine whether the provisions of this
section, and regulations and orders thereunder, are being and have
been complied with by savings and loan holding companies and
subsidiaries and affiliates thereof. For the purpose of any
investigation under this section, the Director may administer oaths
and affirmations, issue subpenas, take evidence, and require the
production of any books, papers, correspondence, memorandums, or
other records which may be relevant or material to the inquiry. The
attendance of witnesses and the production of any such records may
be required from any place in any State. The Director may apply to
the United States district court for the judicial district (or the
United States court in any territory) in which any witness or
company subpenaed resides or carries on business, for enforcement of
any subpena issued pursuant to this paragraph, and such courts shall
have jurisdiction and power to order and require compliance.
(3) Proceedings
(A) In any proceeding under subsection (a)(2)(D) of this section
or under paragraph (5) of this section,\6\ the Director may
administer oaths and affirmations, take or cause to be taken
depositions, and issue subpenas. The Director may make regulations
with respect to any such proceedings. The attendance of witnesses
and the production of documents provided for in this paragraph may
be required from any place in any State or in any territory at any
designated place where such proceeding is being conducted. Any party
to such proceedings may apply to the United States District Court
for the District of Columbia, or the United States district court
for the judicial district or the United States court in any
territory in which such proceeding is being conducted, or where the
witness resides or carries on business, for enforcement of any
subpena issued pursuant to this paragraph, and such courts shall
have jurisdiction and power to order and require compliance
therewith. Witnesses subpenaed under this section shall be paid the
same fees and mileage that are paid witnesses in the district courts
of the United States.
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\6\ So in original. Probably should be ``subsection,''.
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(B) Any hearing provided for in subsection (a)(2)(D) of this
section or under paragraph (5) of this section \7\ shall be held in
the Federal judicial district or in the territory in which the
principal office of the association or other company is located
unless the party afforded the hearing consents to another place, and
shall be conducted in accordance with the provisions of chapter 5 of
title 5.
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\7\ So in original. Probably should be ``subsection''.
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(4) Injunctions
Whenever it appears to the Director that any person is engaged
or has engaged or is about to engage in any acts or practices which
constitute or will constitute a violation of the provisions of this
section or of any regulation or order thereunder, the Director may
bring an action in the proper United States district court, or the
United States court of any territory or other place subject to the
jurisdiction of the United States, to enjoin such acts or practices,
to enforce compliance with this section or any regulation or order,
or to require the divestiture of any acquisition in violation of
this section, or for any combination of the foregoing, and such
courts shall have jurisdiction of such actions. Upon a proper
showing an injunction, decree, restraining order, order of
divestiture, or other appropriate order shall be granted without
bond.
(5) Cease and desist orders
(A) Notwithstanding any other provision of this section, the
Director may, whenever the Director has reasonable cause to believe
that the continuation by a savings and loan holding company of any
activity or of ownership or control of any of its noninsured
subsidiaries constitutes a serious risk to the financial safety,
soundness, or stability of a savings and loan holding company's
subsidiary savings association and is inconsistent with the sound
operation of a savings association or with the purposes of this
section or section 8 of the Federal Deposit Insurance Act [12 U.S.C.
1818], order the savings and loan holding company or any of its
subsidiaries, after due notice and opportunity for hearing, to
terminate such activities or to terminate (within 120 days or such
longer period as the Director directs in unusual circumstances) its
ownership or control of any such noninsured subsidiary either by
sale or by distribution of the shares of the subsidiary to the
shareholders of the savings and loan holding company. Such
distribution shall be pro rata with respect to all of the
shareholders of the distributing savings and loan holding company,
and the holding company shall not make any charge to its
shareholders arising out of such a distribution.
(B) The Director may in the Director's discretion apply to the
United States district court within the jurisdiction of which the
principal office of the company is located, for the enforcement of
any effective and outstanding order issued under this section, and
such court shall have jurisdiction and power to order and require
compliance therewith. Except as provided in subsection (j) of this
section, no court shall have jurisdiction to affect by injunction or
otherwise the issuance or enforcement of any notice or order under
this section, or to review, modify, suspend, terminate, or set aside
any such notice or order.
(h) Prohibited acts
It shall be unlawful for--
(1) any savings and loan holding company or subsidiary thereof,
or any director, officer, employee, or person owning, controlling,
or holding with power to vote, or holding proxies representing, more
than 25 percent of the voting shares, of such holding company or
subsidiary, to hold, solicit, or exercise any proxies in respect of
any voting rights in a savings association which is a mutual
association;
(2) any director or officer of a savings and loan holding
company, or any individual who owns, controls, or holds with power
to vote (or holds proxies representing) more than 25 percent of the
voting shares of such holding company, to acquire control of any
savings association not a subsidiary of such savings and loan
holding company, unless such acquisition is approved by the Director
pursuant to subsection (e)(4) of this section; or
(3) any individual, except with the prior approval of the
Director, to serve or act as a director, officer, or trustee of, or
become a partner in, any savings and loan holding company after
having been convicted of any criminal offense involving dishonesty
or breach of trust.
(i) Penalties
(1) Criminal penalty
(A) Whoever knowingly violates any provision of this section or
being a company, violates any regulation or order issued by the
Director under this section, shall be imprisoned not more than 1
year, fined not more than $100,000 per day for each day during which
the violation continues, or both.
(B) Whoever, with the intent to deceive, defraud, or profit
significantly, knowingly violates any provision of this section
shall be fined not more than $1,000,000 per day for each day during
which the violation continues, imprisoned not more than 5 years, or
both.
(2) \8\ Civil money penalty
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\8\ See Codification note below.
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(A) Penalty
Any company which violates, and any person who participates
in a violation of, any provision of this section, or any
regulation or order issued pursuant thereto, shall forfeit and
pay a civil penalty of not more than $25,000 for each day during
which such violation continues.
(B) Assessment
Any penalty imposed under subparagraph (A) may be assessed
and collected by the Director in the manner provided in
subparagraphs (E), (F), (G), and (I) of section 8(i)(2) of the
Federal Deposit Insurance Act [12 U.S.C. 1818(i)(2)(E), (F),
(G), (I)] for penalties imposed (under such section) and any
such assessment shall be subject to the provisions of such
section.
(C) Hearing
The company or other person against whom any civil penalty
is assessed under this paragraph shall be afforded a hearing if
such company or person submits a request for such hearing within
20 days after the issuance of the notice of assessment. Section
8(h) of the Federal Deposit Insurance Act shall apply to any
proceeding under this paragraph.
(D) Disbursement
All penalties collected under authority of this paragraph
shall be deposited into the Treasury.
(E) ``Violate'' defined
For purposes of this section, the term ``violate'' includes
any action (alone or with another or others) for or toward
causing, bringing about, participating in, counseling, or aiding
or abetting a violation.
(F) Regulations
The Director shall prescribe regulations establishing such
procedures as may be necessary to carry out this paragraph.
(3) \8\ Civil money penalty
(A) Penalty
Any company which violates, and any person who participates
in a violation of, any provision of this section, or any
regulation or order issued pursuant thereto, shall forfeit and
pay a civil penalty of not more than $25,000 for each day during
which such violation continues.
(B) Assessment; etc.
Any penalty imposed under subparagraph (A) may be assessed
and collected by the Director in the manner provided in
subparagraphs (E), (F), (G), and (I) of section 8(i)(2) of the
Federal Deposit Insurance Act [12 U.S.C. 1818(i)(2)(E), (F),
(G), (I)] for penalties imposed (under such section) and any
such assessment shall be subject to the provisions of such
section.
(C) Hearing
The company or other person against whom any penalty is
assessed under this paragraph shall be afforded an agency
hearing if such company or person submits a request for such
hearing within 20 days after the issuance of the notice of
assessment. Section 8(h) of the Federal Deposit Insurance Act
shall apply to any proceeding under this paragraph.
(D) Disbursement
All penalties collected under authority of this paragraph
shall be deposited into the Treasury.
(E) ``Violate'' defined
For purposes of this section, the term ``violate'' includes
any action (alone or with another or others) for or toward
causing, bringing about, participating in, counseling, or aiding
or abetting a violation.
(F) Regulations
The Director shall prescribe regulations establishing such
procedures as may be necessary to carry out this paragraph.
(4) Redesignated (3)
(5) Notice under this section after separation from service
The resignation, termination of employment or participation, or
separation of an institution-affiliated party (within the meaning of
section 3(u) of the Federal Deposit Insurance Act [12 U.S.C.
1813(u)]) with respect to a savings and loan holding company or
subsidiary thereof (including a separation caused by the
deregistration of such a company or such a subsidiary) shall not
affect the jurisdiction and authority of the Director to issue any
notice and proceed under this section against any such party, if
such notice is served before the end of the 6-year period beginning
on the date such party ceased to be such a party with respect to
such holding company or its subsidiary (whether such date occurs
before, on, or after August 9, 1989).
(j) Judicial review
Any party aggrieved by an order of the Director under this section
may obtain a review of such order by filing in the court of appeals of
the United States for the circuit in which the principal office of such
party is located, or in the United States Court of Appeals for the
District of Columbia Circuit, within 30 days after the date of service
of such order, a written petition praying that the order of the Director
be modified, terminated, or set aside. A copy of the petition shall be
forthwith transmitted by the clerk of the court to the Director, and
thereupon the Director shall file in the court the record in the
proceeding, as provided in section 2112 of title 28. Upon the filing of
such petition, such court shall have jurisdiction, which upon the filing
of the record shall be exclusive, to affirm, modify, terminate, or set
aside, in whole or in part, the order of the Director. Review of such
proceedings shall be had as provided in chapter 7 of title 5. The
judgment and decree of the court shall be final, except that the same
shall be subject to review by the Supreme Court upon certiorari as
provided in section 1254 of title 28.
(k) Savings clause
Nothing contained in this section, other than any transaction
approved under subsection (e)(2) of this section or section 13 of the
Federal Deposit Insurance Act [12 U.S.C. 1823], shall be interpreted or
construed as approving any act, action, or conduct which is or has been
or may be in violation of existing law, nor shall anything herein
contained constitute a defense to any action, suit, or proceeding
pending or hereafter instituted on account of any act, action, or
conduct in violation of the antitrust laws.
(l) Treatment of FDIC insured State savings banks and cooperative banks
as savings associations
(1) In general
Notwithstanding any other provision of law, a savings bank (as
defined in section 3(g) of the Federal Deposit Insurance Act [12
U.S.C. 1813(g)]) and a cooperative bank that is an insured bank (as
defined in section 3(h) of the Federal Deposit Insurance Act) upon
application shall be deemed to be a savings association for the
purpose of this section, if the Director determines that such bank
is a qualified thrift lender (as determined under subsection (m) of
this section).
(2) Failure to maintain qualified thrift lender status
If any savings bank which is deemed to be a savings association
under paragraph (1) subsequently fails to maintain its status as a
qualified thrift lender, as determined by the Director, such bank
may not thereafter be a qualified thrift lender for a period of 5
years.
(m) Qualified thrift lender test
(1) In general
Except as provided in paragraphs (2) and (7), any savings
association is a qualified thrift lender if--
(A) the savings association qualifies as a domestic building
and loan association, as such term is defined in section
7701(a)(19) of title 26; or
(B)(i) the savings association's qualified thrift
investments equal or exceed 65 percent of the savings
association's portfolio assets; and
(ii) the savings association's qualified thrift investments
continue to equal or exceed 65 percent of the savings
association's portfolio assets on a monthly average basis in 9
out of every 12 months.
(2) Exceptions granted by Director
Notwithstanding paragraph (1), the Director may grant such
temporary and limited exceptions from the minimum actual thrift
investment percentage requirement contained in such paragraph as the
Director deems necessary if--
(A) the Director determines that extraordinary circumstances
exist, such as when the effects of high interest rates reduce
mortgage demand to such a degree that an insufficient
opportunity exists for a savings association to meet such
investment requirements; or
(B) the Director determines that--
(i) the grant of any such exception will significantly
facilitate an acquisition under section 13(c) or 13(k) of
the Federal Deposit Insurance Act [12 U.S.C. 1823(c) or
(k)];
(ii) the acquired association will comply with the
transition requirements of paragraph (7)(B), as if the date
of the exemption were the starting date for the transition
period described in that paragraph; and
(iii) the Director determines that the exemption will
not have an undue adverse effect on competing savings
associations in the relevant market and will further the
purposes of this subsection.
(3) Failure to become and remain a qualified thrift lender
(A) In general
A savings association that fails to become or remain a
qualified thrift lender shall either become one or more banks
(other than a savings bank) or be subject to subparagraph (B),
except as provided in subparagraph (D).
(B) Restrictions applicable to savings associations that are not
qualified thrift lenders
(i) Restrictions effective immediately
The following restrictions shall apply to a savings
association beginning on the date on which the savings
association should have become or ceases to be a qualified
thrift lender:
(I) Activities
The savings association shall not make any new
investment (including an investment in a subsidiary) or
engage, directly or indirectly, in any other new
activity unless that investment or activity would be
permissible for the savings association if it were a
national bank, and is also permissible for the savings
association as a savings association.
(II) Branching
The savings association shall not establish any new
branch office at any location at which a national bank
located in the savings association's home State may not
establish a branch office. For purposes of this
subclause, a savings association's home State is the
State in which the savings association's total deposits
were largest on the date on which the savings
association should have become or ceased to be a
qualified thrift lender.
(III) Dividends
The savings association shall be subject to all
statutes and regulations governing the payment of
dividends by a national bank in the same manner and to
the same extent as if the savings association were a
national bank.
(ii) Additional restrictions effective after 3 years
Beginning 3 years after the date on which a savings
association should have become a qualified thrift lender, or
the date on which the savings association ceases to be a
qualified thrift lender, as applicable, the savings
association shall not retain any investment (including an
investment in any subsidiary) or engage, directly or
indirectly, in any activity, unless that investment or
activity--
(I) would be permissible for the savings association
if it were a national bank; and
(II) is permissible for the savings association as a
savings association.
(C) Holding company regulation
Any company that controls a savings association that is
subject to any provision of subparagraph (B) shall, within one
year after the date on which the savings association should have
become or ceases to be a qualified thrift lender, register as
and be deemed to be a bank holding company subject to all of the
provisions of the Bank Holding Company Act of 1956 [12 U.S.C.
1841 et seq.], section 8 of the Federal Deposit Insurance Act
[12 U.S.C. 1818], and other statutes applicable to bank holding
companies, in the same manner and to the same extent as if the
company were a bank holding company and the savings association
were a bank, as those terms are defined in the Bank Holding
Company Act of 1956.
(D) Requalification
A savings association that should have become or ceases to
be a qualified thrift lender shall not be subject to
subparagraph (B) or (C) if the savings association becomes a
qualified thrift lender by meeting the qualified thrift lender
requirement in paragraph (1) on a monthly average basis in 9 out
of the preceding 12 months and remains a qualified thrift
lender. If the savings association (or any savings association
that acquired all or substantially all of its assets from that
savings association) at any time thereafter ceases to be a
qualified thrift lender, it shall immediately be subject to all
provisions of subparagraphs (B) and (C) as if all the periods
described in subparagraphs (B)(ii) and (C) had expired.
(E) Deposit insurance assessments
Any bank chartered as a result of the requirements of this
section shall be obligated until December 31, 1993, to pay to
the Savings Association Insurance Fund the assessments assessed
on savings associations under the Federal Deposit Insurance Act
[12 U.S.C. 1811 et seq.]. Such association shall also be
assessed, on the date of its change of status from a Savings
Association Insurance Fund member, the exit fee and entrance fee
provided in section 5(d) of the Federal Deposit Insurance Act
[12 U.S.C. 1815(d)]. Such institution shall not be obligated to
pay the assessments assessed on banks under the Federal Deposit
Insurance Act until--
(i) December 31, 1993, or
(ii) the institution's change of status from a Savings
Association Insurance Fund member to a Bank Insurance Fund
member,
whichever is later.
(F) Exemption for specialized savings associations serving
certain military personnel
Subparagraph (A) shall not apply to a savings association
subsidiary of a savings and loan holding company if at least 90
percent of the customers of the savings and loan holding company
and its subsidiaries and affiliates are active or former members
in the United States military services or the widows, widowers,
divorced spouses, or current or former dependents of such
members.
(G) Exemption for certain Federal savings associations
This paragraph shall not apply to any Federal savings
association in existence as a Federal savings association on
August 9, 1989--
(i) that was chartered before October 15, 1982, as a
savings bank or a cooperative bank under State law; or
(ii) that acquired its principal assets from an
association that was chartered before October 15, 1982, as a
savings bank or a cooperative bank under State law.
(H) No circumvention of exit moratorium
Subparagraph (A) of this paragraph shall not be construed as
permitting any insured depository institution to engage in any
conversion transaction prohibited under section 5(d) of the
Federal Deposit Insurance Act [12 U.S.C. 1815(d)].
(4) Definitions
For purposes of this subsection, the following definitions shall
apply:
(A) Actual thrift investment percentage
The term ``actual thrift investment percentage'' means the
percentage determined by dividing--
(i) the amount of a savings association's qualified
thrift investments, by
(ii) the amount of the savings association's portfolio
assets.
(B) Portfolio assets
The term ``portfolio assets'' means, with respect to any
savings association, the total assets of the savings
association, minus the sum of--
(i) goodwill and other intangible assets;
(ii) the value of property used by the savings
association to conduct its business; and
(iii) liquid assets of the type required to be
maintained under section 1465 of this title, as in effect on
the day before December 27, 2000, in an amount not exceeding
the amount equal to 20 percent of the savings association's
total assets.
(C) Qualified thrift investments
(i) In general
The term ``qualified thrift investments'' means, with
respect to any savings association, the assets of the
savings association that are described in clauses (ii) and
(iii).
(ii) Assets includible without limit
The following assets are described in this clause for
purposes of clause (i):
(I) The aggregate amount of loans held by the
savings association that were made to purchase,
refinance, construct, improve, or repair domestic
residential housing or manufactured housing.
(II) Home-equity loans.
(III) Securities backed by or representing an
interest in mortgages on domestic residential housing or
manufactured housing.
(IV) Existing obligations of deposit insurance
agencies.--Direct or indirect obligations of the Federal
Deposit Insurance Corporation or the Federal Savings and
Loan Insurance Corporation issued in accordance with the
terms of agreements entered into prior to July 1, 1989,
for the 10-year period beginning on the date of issuance
of such obligations.
(V) New obligations of deposit insurance agencies.--
Obligations of the Federal Deposit Insurance
Corporation, the Federal Savings and Loan Insurance
Corporation, the FSLIC Resolution Fund, and the
Resolution Trust Corporation issued in accordance with
the terms of agreements entered into on or after July 1,
1989, for the 5-year period beginning on the date of
issuance of such obligations.
(VI) Shares of stock issued by any Federal home loan
bank.
(VII) Loans for educational purposes, loans to small
businesses, and loans made through credit cards or
credit card accounts.
(iii) Assets includible subject to percentage
restriction
The following assets are described in this clause for
purposes of clause (i):
(I) 50 percent of the dollar amount of the
residential mortgage loans originated by such savings
association and sold within 90 days of origination.
(II) Investments in the capital stock or obligations
of, and any other security issued by, any service
corporation if such service corporation derives at least
80 percent of its annual gross revenues from activities
directly related to purchasing, refinancing,
constructing, improving, or repairing domestic
residential real estate or manufactured housing.
(III) 200 percent of the dollar amount of loans and
investments made to acquire, develop, and construct 1-
to 4-family residences the purchase price of which is or
is guaranteed to be not greater than 60 percent of the
median value of comparable newly constructed 1- to 4-
family residences within the local community in which
such real estate is located, except that not more than
25 percent of the amount included under this subclause
may consist of commercial properties related to the
development if those properties are directly related to
providing services to residents of the development.
(IV) 200 percent of the dollar amount of loans for
the acquisition or improvement of residential real
property, churches, schools, and nursing homes located
within, and loans for any other purpose to any small
businesses located within any area which has been
identified by the Director, in connection with any
review or examination of community reinvestment
practices, as a geographic area or neighborhood in which
the credit needs of the low- and moderate-income
residents of such area or neighborhood are not being
adequately met.
(V) Loans for the purchase or construction of
churches, schools, nursing homes, and hospitals, other
than those qualifying under clause (IV), and loans for
the improvement and upkeep of such properties.
(VI) Loans for personal, family, or household
purposes (other than loans for personal, family, or
household purposes described in clause (ii)(VII)).
(VII) Shares of stock issued by the Federal Home
Loan Mortgage Corporation or the Federal National
Mortgage Association.
(iv) Percentage restriction applicable to certain
assets
The aggregate amount of the assets described in clause
(iii) which may be taken into account in determining the
amount of the qualified thrift investments of any savings
association shall not exceed the amount which is equal to 20
percent of a savings association's portfolio assets.
(v) Qualified thrift investments
The term ``qualified thrift investments'' excludes--
(I) except for home equity loans, that portion of
any loan or investment that is used for any purpose
other than those expressly qualifying under any
subparagraph of clause (ii) or (iii); or
(II) goodwill or any other intangible asset.
(D) Credit card
The Director shall issue such regulations as may be
necessary to define the term ``credit card''.
(E) Small business
The Director shall issue such regulations as may be
necessary to define the term ``small business''.
(5) Consistent accounting required
(A) In determining the amount of a savings association's
portfolio assets, the assets of any subsidiary of the savings
association shall be consolidated with the assets of the savings
association if--
(i) Assets of the subsidiary are consolidated with the
assets of the savings association in determining the savings
association's qualified thrift investments; or
(ii) Residential mortgage loans originated by the subsidiary
are included pursuant to paragraph (4)(C)(iii)(I) in determining
the savings association's qualified thrift investments.
(B) In determining the amount of a savings association's
portfolio assets and qualified thrift investments, consistent
accounting principles shall be applied.
(6) Special rules for Puerto Rico and Virgin Islands savings
associations
(A) Puerto Rico savings associations
With respect to any savings association headquartered and
operating primarily in Puerto Rico--
(i) the term ``qualified thrift investments'' includes,
in addition to the items specified in paragraph (4)--
(I) the aggregate amount of loans for personal,
family, educational, or household purposes made to
persons residing or domiciled in the Commonwealth of
Puerto Rico; and
(II) the aggregate amount of loans for the
acquisition or improvement of churches, schools, or
nursing homes, and of loans to small businesses, located
within the Commonwealth of Puerto Rico; and
(ii) the aggregate amount of loans related to the
purchase, acquisition, development and construction of 1- to
4-family residential real estate--
(I) which is located within the Commonwealth of
Puerto Rico; and
(II) the value of which (at the time of acquisition
or upon completion of the development and construction)
is below the median value of newly constructed 1- to 4-
family residences in the Commonwealth of Puerto Rico,
which may be taken into account in determining the
amount of the qualified thrift investments and of such
savings association shall be doubled.
(B) Virgin Islands savings associations
With respect to any savings association headquartered and
operating primarily in the Virgin Islands--
(i) the term ``qualified thrift investments'' includes,
in addition to the items specified in paragraph (4)--
(I) the aggregate amount of loans for personal,
family, educational, or household purposes made to
persons residing or domiciled in the Virgin Islands; and
(II) the aggregate amount of loans for the
acquisition or improvement of churches, schools, or
nursing homes, and of loans to small businesses, located
within the Virgin Islands; and
(ii) the aggregate amount of loans related to the
purchase, acquisition, development and construction of 1- to
4-family residential real estate--
(I) which is located within the Virgin Islands; and
(II) the value of which (at the time of acquisition
or upon completion of the development and construction)
is below the median value of newly constructed 1- to 4-
family residences in the Virgin Islands, which may be
taken into account in determining the amount of the
qualified thrift investments and of such savings
association shall be doubled.
(7) Transitional rule for certain savings associations
(A) In general
If any Federal savings association in existence as a Federal
savings association on August 9, 1989--
(i) that was chartered as a savings bank or a
cooperative bank under State law before October 15, 1982; or
(ii) that acquired its principal assets from an
association that was chartered before October 15, 1982, as a
savings bank or a cooperative bank under State law,
meets the requirements of subparagraph (B), such savings
association shall be treated as a qualified thrift lender during
period \9\ ending on September 30, 1995.
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\9\ So in original. Probably should be ``the period''.
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(B) Subparagraph (B) requirements
A savings association meets the requirements of this
subparagraph if, in the determination of the Director--
(i) the actual thrift investment percentage of such
association does not, after August 9, 1989, decrease below
the actual thrift investment percentage of such association
on July 15, 1989; and
(ii) the amount by which--
(I) the actual thrift investment percentage of such
association at the end of each period described in the
following table, exceeds
(II) the actual thrift investment percentage of such
association on July 15, 1989,
is equal to or greater than the applicable percentage (as
determined under the following table) of the amount by which
70 percent exceeds the actual thrift investment percentage
of such association on August 9, 1989:
For the followingThe applicable
period:percentage is:
July 1, 1991-September 30, 1992....................... 25 percent
October 1, 1992-March 31, 1994........................ 50 percent
April 1, 1994-September 30, 1995...................... 75 percent
Thereafter............................................ 100 percent
(C) Actual thrift investment percentage
For purposes of this paragraph, the actual thrift investment
percentage of an association on July 15, 1989, shall be
determined by applying the definition of ``actual thrift
investment percentage'' that takes effect on July 1, 1991.
(n) Tying restrictions
A savings and loan holding company and any of its affiliates shall
be subject to section 1464(q) of this title and regulations prescribed
under such section, in connection with transactions involving the
products or services of such company or affiliate and those of an
affiliated savings association as if such company or affiliate were a
savings association.
(o) Mutual holding companies
(1) In general
A savings association operating in mutual form may reorganize so
as to become a holding company by--
(A) chartering an interim savings association, the stock of
which is to be wholly owned, except as otherwise provided in
this section, by the mutual association; and
(B) transferring the substantial part of its assets and
liabilities, including all of its insured liabilities, to the
interim savings association.
(2) Directors and certain account holders' approval of plan
required
A reorganization is not authorized under this subsection
unless--
(A) a plan providing for such reorganization has been
approved by a majority of the board of directors of the mutual
savings association; and
(B) in the case of an association in which holders of
accounts and obligors exercise voting rights, such plan has been
submitted to and approved by a majority of such individuals at a
meeting held at the call of the directors in accordance with the
procedures prescribed by the association's charter and bylaws.
(3) Notice to the Director; disapproval period
(A) Notice required
At least 60 days prior to taking any action described in
paragraph (1), a savings association seeking to establish a
mutual holding company shall provide written notice to the
Director. The notice shall contain such relevant information as
the Director shall require by regulation or by specific request
in connection with any particular notice.
(B) Transaction allowed if not disapproved
Unless the Director within such 60-day notice period
disapproves the proposed holding company formation, or extends
for another 30 days the period during which such disapproval may
be issued, the savings association providing such notice may
proceed with the transaction, if the requirements of paragraph
(2) have been met.
(C) Grounds for disapproval
The Director may disapprove any proposed holding company
formation only if--
(i) such disapproval is necessary to prevent unsafe or
unsound practices;
(ii) the financial or management resources of the
savings association involved warrant disapproval;
(iii) the savings association fails to furnish the
information required under subparagraph (A); or
(iv) the savings association fails to comply with the
requirement of paragraph (2).
(D) Retention of capital assets
In connection with the transaction described in paragraph
(1), a savings association may, subject to the approval of the
Director, retain capital assets at the holding company level to
the extent that such capital exceeds the association's capital
requirement established by the Director pursuant to sections
\10\ 1464(s) and (t) of this title.
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\10\ So in original. Probably should be ``section''.
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(4) Ownership
(A) In general
Persons having ownership rights in the mutual association
pursuant to section 1464(b)(1)(B) of this title or State law
shall have the same ownership rights with respect to the mutual
holding company.
(B) Holders of certain accounts
Holders of savings, demand or other accounts of--
(i) a savings association chartered as part of a
transaction described in paragraph (1); or
(ii) a mutual savings association acquired pursuant to
paragraph (5)(B),
shall have the same ownership rights with respect to the mutual
holding company as persons described in subparagraph (A) of this
paragraph.
(5) Permitted activities
A mutual holding company may engage only in the following
activities:
(A) Investing in the stock of a savings association.
(B) Acquiring a mutual association through the merger of
such association into a savings association subsidiary of such
holding company or an interim savings association subsidiary of
such holding company.
(C) Subject to paragraph (6), merging with or acquiring
another holding company, one of whose subsidiaries is a savings
association.
(D) Investing in a corporation the capital stock of which is
available for purchase by a savings association under Federal
law or under the law of any State where the subsidiary savings
association or associations have their home offices.
(E) Engaging in the activities described in subsection
(c)(2) or (c)(9)(A)(ii) of this section.
(6) Limitations on certain activities of acquired holding
companies
(A) New activities
If a mutual holding company acquires or merges with another
holding company under paragraph (5)(C), the holding company
acquired or the holding company resulting from such merger or
acquisition may only invest in assets and engage in activities
which are authorized under paragraph (5).
(B) Grace period for divesting prohibited assets or
discontinuing prohibited activities
Not later than 2 years following a merger or acquisition
described in paragraph (5)(C), the acquired holding company or
the holding company resulting from such merger or acquisition
shall--
(i) dispose of any asset which is an asset in which a
mutual holding company may not invest under paragraph (5);
and
(ii) cease any activity which is an activity in which a
mutual holding company may not engage under paragraph (5).
(7) Regulation
A mutual holding company shall be chartered by the Director and
shall be subject to such regulations as the Director may prescribe.
Unless the context otherwise requires, a mutual holding company
shall be subject to the other requirements of this section regarding
regulation of holding companies.
(8) Capital improvement
(A) Pledge of stock of savings association subsidiary
This section shall not prohibit a mutual holding company
from pledging all or a portion of the stock of a savings
association chartered as part of a transaction described in
paragraph (1) to raise capital for such savings association.
(B) Issuance of nonvoting shares
This section shall not prohibit a savings association
chartered as part of a transaction described in paragraph (1)
from issuing any nonvoting shares or less than 50 percent of the
voting shares of such association to any person other than the
mutual holding company.
(9) Insolvency and liquidation
(A) In general
Notwithstanding any provision of law, upon--
(i) the default of any savings association--
(I) the stock of which is owned by any mutual
holding company; and
(II) which was chartered in a transaction described
in paragraph (1);
(ii) the default of a mutual holding company; or
(iii) a foreclosure on a pledge by a mutual holding
company described in paragraph (8)(A),
a trustee shall be appointed receiver of such mutual holding
company and such trustee shall have the authority to liquidate
the assets of, and satisfy the liabilities of, such mutual
holding company pursuant to title 11.
(B) Distribution of net proceeds
Except as provided in subparagraph (C), the net proceeds of
any liquidation of any mutual holding company pursuant to
subparagraph (A) shall be transferred to persons who hold
ownership interests in such mutual holding company.
(C) Recovery by Corporation
If the Corporation incurs a loss as a result of the default
of any savings association subsidiary of a mutual holding
company which is liquidated pursuant to subparagraph (A), the
Corporation shall succeed to the ownership interests of the
depositors of such savings association in the mutual holding
company, to the extent of the Corporation's loss.
(10) Definitions
For purposes of this subsection--
(A) Mutual holding company
The term ``mutual holding company'' means a corporation
organized as a holding company under this subsection.
(B) Mutual association
The term ``mutual association'' means a savings association
which is operating in mutual form.
(C) Default
The term ``default'' means an adjudication or other official
determination of a court of competent jurisdiction or other
public authority pursuant to which a conservator, receiver, or
other legal custodian is appointed.
(p) Holding company activities constituting serious risk to subsidiary
savings association
(1) Determination and imposition of restrictions
If the Director determines that there is reasonable cause to
believe that the continuation by a savings and loan holding company
of any activity constitutes a serious risk to the financial safety,
soundness, or stability of a savings and loan holding company's
subsidiary savings association, the Director may impose such
restrictions as the Director determines to be necessary to address
such risk. Such restrictions shall be issued in the form of a
directive to the holding company and any of its subsidiaries,
limiting--
(A) the payment of dividends by the savings association;
(B) transactions between the savings association, the
holding company, and the subsidiaries or affiliates of either;
and
(C) any activities of the savings association that might
create a serious risk that the liabilities of the holding
company and its other affiliates may be imposed on the savings
association.
Such directive shall be effective as a cease and desist order that
has become final.
(2) Review of directive
(A) Administrative review
After a directive referred to in paragraph (1) is issued,
the savings and loan holding company, or any subsidiary of such
holding company subject to the directive, may object and present
in writing its reasons why the directive should be modified or
rescinded. Unless within 10 days after receipt of such response
the Director affirms, modifies, or rescinds the directive, such
directive shall automatically lapse.
(B) Judicial review
If the Director affirms or modifies a directive pursuant to
subparagraph (A), any affected party may immediately thereafter
petition the United States district court for the district in
which the savings and loan holding company has its main office
or in the United States District Court for the District of
Columbia to stay, modify, terminate or set aside the directive.
Upon a showing of extraordinary cause, the savings and loan
holding company, or any subsidiary of such holding company
subject to a directive, may petition a United States district
court for relief without first pursuing or exhausting the
administrative remedies set forth in this paragraph.
(q) Qualified stock issuance by undercapitalized savings associations or
holding companies
(1) In general
For purposes of this section, any issue of shares of stock shall
be treated as a qualified stock issuance if the following conditions
are met:
(A) The shares of stock are issued by--
(i) an undercapitalized savings association; or
(ii) a savings and loan holding company which is not a
bank holding company but which controls an undercapitalized
savings association if, at the time of issuance, the savings
and loan holding company is legally obligated to contribute
the net proceeds from the issuance of such stock to the
capital of an undercapitalized savings association
subsidiary of such holding company.
(B) All shares of stock issued consist of previously
unissued stock or treasury shares.
(C) All shares of stock issued are purchased by a savings
and loan holding company that is registered, as of the date of
purchase, with the Director in accordance with the provisions of
subsection (b)(1) of this section.
(D) Subject to paragraph (2), the Director approved the
purchase of the shares of stock by the acquiring savings and
loan holding company.
(E) The entire consideration for the stock issued is paid in
cash by the acquiring savings and loan holding company.
(F) At the time of the stock issuance, each savings
association subsidiary of the acquiring savings and loan holding
company (other than an association acquired in a transaction
pursuant to subsection (c) or (k) of section 13 of the Federal
Deposit Insurance Act [12 U.S.C. 1823(c) or (k)] or section
408(m) \11\ of the National Housing Act [12 U.S.C. 1730a(m)])
has capital (after deducting any subordinated debt, intangible
assets, and deferred, unamortized gains or losses) of not less
than 6\1/2\ percent of the total assets of such savings
association.
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\11\ See References in Text note below.
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(G) Immediately after the stock issuance, the acquiring
savings and loan holding company holds not more than 15 percent
of the outstanding voting stock of the issuing undercapitalized
savings association or savings and loan holding company.
(H) Not more than one of the directors of the issuing
association or company is an officer, director, employee, or
other representative of the acquiring company or any of its
affiliates.
(I) Transactions between the savings association or savings
and loan holding company that issues the shares pursuant to this
section and the acquiring company and any of its affiliates
shall be subject to the provisions of section 1468 of this
title.
(2) Approval of acquisitions
(A) Additional capital commitments not required
The Director shall not disapprove any application for the
purchase of stock in connection with a qualified stock issuance
on the grounds that the acquiring savings and loan holding
company has failed to undertake to make subsequent additional
capital contributions to maintain the capital of the
undercapitalized savings association at or above the minimum
level required by the Director or any other Federal agency
having jurisdiction.
(B) Other conditions
Notwithstanding subsection (a)(4) of this section, the
Director may impose such conditions on any approval of an
application for the purchase of stock in connection with a
qualified stock issuance as the Director determines to be
appropriate, including--
(i) a requirement that any savings association
subsidiary of the acquiring savings and loan holding company
limit dividends paid to such holding company for such period
of time as the Director may require; and
(ii) such other conditions as the Director deems
necessary or appropriate to prevent evasions of this
section.
(C) Application deemed approved if not disapproved within 90
days
An application for approval of a purchase of stock in
connection with a qualified stock issuance shall be deemed to
have been approved by the Director if such application has not
been disapproved by the Director before the end of the 90-day
period beginning on the date such application has been deemed
sufficient under regulations issued by the Director.
(3) No limitation on class of stock issued
The shares of stock issued in connection with a qualified stock
issuance may be shares of any class.
(4) ``Undercapitalized savings association'' defined
For purposes of this subsection, the term ``undercapitalized
savings association'' means any savings association--
(A) the assets of which exceed the liabilities of such
association; and
(B) which does not comply with one or more of the capital
standards in effect under section 1464(t) of this title.
(r) Penalty for failure to provide timely and accurate reports
(1) First tier
Any savings and loan holding company, and any subsidiary of such
holding company, which--
(A) maintains procedures reasonably adapted to avoid any
inadvertent and unintentional error and, as a result of such an
error--
(i) fails to submit or publish any report or information
required under this section or regulations prescribed by the
Director, within the period of time specified by the
Director; or
(ii) submits or publishes any false or misleading report
or information; or
(B) inadvertently transmits or publishes any report which is
minimally late,
shall be subject to a penalty of not more than $2,000 for each day
during which such failure continues or such false or misleading
information is not corrected. Such holding company or subsidiary
shall have the burden of proving by a preponderence \12\ of the
evidence that an error was inadvertent and unintentional and that a
report was inadvertently transmitted or published late.
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\12\ So in original. Probably should be ``preponderance''.
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(2) Second tier
Any savings and loan holding company, and any subsidiary of such
holding company, which--
(A) fails to submit or publish any report or information
required under this section or under regulations prescribed by
the Director, within the period of time specified by the
Director; or
(B) submits or publishes any false or misleading report or
information,
in a manner not described in paragraph (1) shall be subject to a
penalty of not more than $20,000 for each day during which such
failure continues or such false or misleading information is not
corrected.
(3) Third tier
If any savings and loan holding company or any subsidiary of
such a holding company knowingly or with reckless disregard for the
accuracy of any information or report described in paragraph (2)
submits or publishes any false or misleading report or information,
the Director may assess a penalty of not more than $1,000,000 or 1
percent of total assets of such company or subsidiary, whichever is
less, per day for each day during which such failure continues or
such false or misleading information is not corrected.
(4) Assessment
Any penalty imposed under paragraph (1), (2), or (3) shall be
assessed and collected by the Director in the manner provided in
subparagraphs (E), (F), (G), and (I) of section 8(i)(2) of the
Federal Deposit Insurance Act [12 U.S.C. 1818(i)(2)(E), (F), (G),
(I)] (for penalties imposed under such section) and any such
assessment (including the determination of the amount of the
penalty) shall be subject to the provisions of such subsection.
(5) Hearing
Any savings and loan holding company or any subsidiary of such a
holding company against which any penalty is assessed under this
subsection shall be afforded a hearing if such savings and loan
holding company or such subsidiary, as the case may be, submits a
request for such hearing within 20 days after the issuance of the
notice of assessment. Section 8(h) of the Federal Deposit Insurance
Act [12 U.S.C. 1818(h)] shall apply to any proceeding under this
subsection.
(s) Mergers, consolidations, and other acquisitions authorized
(1) In general
Subject to sections 5(d)(3) and 18(c) of the Federal Deposit
Insurance Act [12 U.S.C. 1815(d)(3), 1828(c)] and all other
applicable laws, any Federal savings association may acquire or be
acquired by any insured depository institution.
(2) Expedited approval of acquisitions
(A) In general
Any application by a savings association to acquire or be
acquired by another insured depository institution which is
required to be filed with the Director under any applicable law
or regulation shall be approved or disapproved in writing by the
Director before the end of the 60-day period beginning on the
date such application is filed with the agency.
(B) Extension of period
The period for approval or disapproval referred to in
subparagraph (A) may be extended for an additional 30-day period
if the Director determines that--
(i) an applicant has not furnished all of the
information required to be submitted; or
(ii) in the Director's judgment, any material
information submitted is substantially inaccurate or
incomplete.
(3) ``Acquire'' defined
For purposes of this subsection, the term ``acquire'' means to
acquire, directly or indirectly, ownership or control through a
merger or consolidation or an acquisition of assets or assumption of
liabilities, provided that following such merger, consolidation, or
acquisition, an acquiring insured depository institution may not own
the shares of the acquired insured depository institution.
(4) Regulations
(A) Required
The Director shall prescribe such regulations as may be
necessary to carry out paragraph (1).
(B) Effective date
The regulations required under subparagraph (A) shall--
(i) be prescribed in final form before the end of the
90-day period beginning on December 19, 1991; and
(ii) take effect before the end of the 120-day period
beginning on December 19, 1991.
(5) Limitation
No provision of this section shall be construed to authorize a
national bank or any subsidiary thereof to engage in any activity
not otherwise authorized under the National Bank Act [12 U.S.C. 21
et seq.] or any other law governing the powers of a national bank.
(t) Exemption for bank holding companies
This section shall not apply to a bank holding company that is
subject to the Bank Holding Company Act of 1956 [12 U.S.C. 1841 et
seq.], or any company controlled by such bank holding company.
(June 13, 1933, ch. 64, Sec. 10, as added Pub. L. 100-86, title IV,
Sec. 404(a), Aug. 10, 1987, 101 Stat. 609; amended Pub. L. 101-73, title
III, Secs. 301, 303(a), title IX, Secs. 905(j), 907(k), Aug. 9, 1989,
103 Stat. 318, 343, 462, 475; Pub. L. 102-242, title II, Sec. 211, title
IV, Secs. 437-440, title V, Sec. 502(a), Dec. 19, 1991, 105 Stat. 2298,
2381, 2392; Pub. L. 102-550, title XVI, Secs. 1606(f)(4), 1607(b), Oct.
28, 1992, 106 Stat. 4088, 4089; Pub. L. 104-201, div. A, title X,
Sec. 1077, Sept. 23, 1996, 110 Stat. 2664; Pub. L. 104-208, div. A,
title II, Secs. 2201(b)(2), 2203(a)-(c), 2303(e), (g), 2704(d)(12)(B),
Sept. 30, 1996, 110 Stat. 3009-403, 3009-404, 3009-424, 3009-425, 3009-
490; Pub. L. 106-102, title IV, Sec. 401(a), (b), title VI, Sec. 604(d),
Nov. 12, 1999, 113 Stat. 1434, 1436, 1452; Pub. L. 106-569, title XII,
Secs. 1201(b)(2), 1202, Dec. 27, 2000, 114 Stat. 3032.)
References in Text
Sections 406 and 408 of the National Housing Act, referred to in
subsecs. (c)(3)(B)(i)(I), (6)(C)(i), (iv), (e)(1)(A)(iii)(VI), and
(q)(1)(F), which were classified to sections 1729 and 1730a of this
title, respectively, were repealed by Pub. L. 101-73, title IV,
Sec. 407, Aug. 9, 1989, 103 Stat. 363.
The antitrust laws, referred to in subsec. (k), are classified
generally to chapter 1 (Sec. 1 et seq.) of Title 15, Commerce and Trade.
The Bank Holding Company Act of 1956, referred to in subsecs.
(a)(1)(D)(ii), (e)(1)(B)(iii), (m)(3)(C), and (t), is act May 9, 1956,
ch. 240, 70 Stat. 133, as amended, which is classified principally to
chapter 17 (Sec. 1841 et seq.) of this title. For complete
classification of this Act to the Code, see Short Title note set out
under section 1841 of this title and Tables.
The Federal Deposit Insurance Act, referred to in subsec. (m)(3)(E),
is act Sept. 21, 1950, ch. 967, Sec. 2, 64 Stat. 873, as amended, which
is classified generally to chapter 16 (Sec. 1811 et seq.) of this title.
For complete classification of this Act to the Code, see Short Title
note set out under section 1811 of this title and Tables.
Section 1465 of this title, referred to in subsec. (m)(4)(B)(iii),
was repealed by Pub. L. 106-569, title XII, Sec. 1201(a), Dec. 27, 2000,
114 Stat. 3032.
The National Bank Act, referred to in subsec. (s)(5), is act June 3,
1864, ch. 106, 13 Stat. 99, as amended, which is classified principally
to chapter 2 (Sec. 21 et seq.) of this title. For complete
classification of this Act to the Code, see References in Text note set
out under section 38 of this title.
Codification
The directory language of sections 905(j) and 907(k) of Pub. L. 101-
73 amending subsec. (i) of this section resulted in the enactment of two
virtually identical pars. (2) and (3) both relating to civil money
penalties and a par. (5) identical to former par. (4). See 1989
Amendment notes below.
Amendments
2000--Subsec. (e)(1)(A)(iii). Pub. L. 106-569, Sec. 1202, in
introductory provisions, inserted ``, except with the prior written
approval of the Director,'' after ``to acquire, by purchase or
otherwise, or to retain'' and substituted ``acquire or retain, and the
Director may not authorize acquisition or retention of,'' for ``so
acquire or retain''.
Subsec. (m)(4)(B)(iii). Pub. L. 106-569, Sec. 1201(b)(2), inserted
``as in effect on the day before December 27, 2000,'' after ``section
1465 of this title,''.
1999--Subsec. (c)(9). Pub. L. 106-102, Sec. 401(a), added par. (9).
Subsec. (m)(3)(B)(i)(III), (IV). Pub. L. 106-102, Sec. 604(d)(1),
redesignated subcl. (IV) as (III) and struck out heading and text of
former subcl. (III). Text read as follows: ``The savings association
shall not be eligible to obtain new advances from any Federal home loan
bank.''
Subsec. (m)(3)(B)(ii). Pub. L. 106-102, Sec. 604(d)(2), added cl.
(ii) and struck out heading and text of former cl. (ii). Text read as
follows: ``The following additional restrictions shall apply to a
savings association beginning 3 years after the date on which the
savings association should have become or ceases to be a qualified
thrift lender:
``(I) Activities.--The savings association shall not retain any
investment (including an investment in any subsidiary) or engage,
directly or indirectly, in any activity unless that investment or
activity would be permissible for the savings association if it were a
national bank, and is also permissible for the savings association as a
savings association.
``(II) Advances.--The savings association shall repay any
outstanding advances from any Federal home loan bank as promptly as can
be prudently done consistent with the safe and sound operation of the
savings association.''
Subsec. (o)(5)(E). Pub. L. 106-102, Sec. 401(b), substituted
``subsection (c)(2) or (c)(9)(A)(ii) of this section'' for ``subsection
(c)(2) of this section, except subparagraph (B)''.
1996--Subsec. (a)(1)(D). Pub. L. 104-208, Sec. 2203(b), amended
heading and text of subpar. (D) generally. Prior to amendment, text read
as follows: ``The term `savings and loan holding company' means any
company which directly or indirectly controls a savings association or
controls any other company which is a savings and loan holding
company.''
Subsec. (e)(1)(A)(iii)(VII). Pub. L. 104-208,
Sec. 2704(d)(12)(B)(i), which directed insertion of ``or'' at end, was
not executed. See Effective Date of 1996 Amendment note below.
Pub. L. 104-208, Sec. 2203(c)(1), inserted ``or'' at end.
Subsec. (e)(1)(A)(iv). Pub. L. 104-208, Sec. 2704(d)(12)(B)(ii),
which directed insertion of ``and'' at end, was not executed. See
Effective Date of 1996 Amendment note below.
Pub. L. 104-208, Sec. 2203(c)(2), inserted ``and'' at end.
Subsec. (e)(1)(B). Pub. L. 104-208, Sec. 2704(d)(12)(B)(iii), which
directed substitution of ``Deposit Insurance Fund'' for ``Savings
Association Insurance Fund or Bank Insurance Fund'', was not executed.
See Effective Date of 1996 Amendment note below.
Subsec. (e)(1)(B)(iii). Pub. L. 104-208, Sec. 2203(c)(3), added cl.
(iii).
Subsec. (e)(2). Pub. L. 104-208, Sec. 2704(d)(12)(B)(iv), which
directed substitution of ``Deposit Insurance Fund'' for ``Savings
Association Insurance Fund or the Bank Insurance Fund'', was not
executed. See Effective Date of 1996 Amendment note below.
Subsec. (m)(1). Pub. L. 104-208, Sec. 2203(e)(3), added subpar. (A),
redesignated existing provisions as subpar. (B), and redesignated former
subpars. (A) and (B) as cls. (i) and (ii), respectively, of subpar. (B).
Subsec. (m)(3)(E). Pub. L. 104-208, Sec. 2704(d)(12)(B)(v), which
directed the amendment of par. (3) by striking subpar. (E) and
redesignating subpar. (F) as (E), was not executed. See Effective Date
of 1996 Amendment note below.
Subsec. (m)(3)(F). Pub. L. 104-208, Sec. 2704(d)(12)(B)(v), which
directed the amendment of par. (3) by redesignating subpar. (F) as (E),
was not executed. See Effective Date of 1996 Amendment note below.
Pub. L. 104-201 substituted ``associations serving certain'' for
``association serving transient'' in heading, substituted ``company if''
for ``company if--'' and cl. (i), struck out cl. (ii) designation before
``at least 90'', and substituted ``members'' for ``officers'' in two
places. Prior to amendment, cl. (i) read as follows: ``the savings and
loan holding company is a reciprocal interinsurance exchange that
acquired control of the insured institution before January 1, 1984;
and''.
Subsec. (m)(3)(G), (H). Pub. L. 104-208, Sec. 2704(d)(12)(B)(v),
which directed the amendment of par. (3) by redesignating subpars. (G)
and (H) as (F) and (G), respectively, was not executed. See Effective
Date of 1996 Amendment note below.
Subsec. (m)(4). Pub. L. 104-208, Sec. 2303(g)(1), substituted
``subsection, the following definitions apply:'' for ``subsection--'' in
introductory provisions.
Subsec. (m)(4)(C)(ii)(VII). Pub. L. 104-208, Sec. 2303(g)(2)(A),
added subcl. (VII).
Subsec. (m)(4)(C)(iii)(VI). Pub. L. 104-208, Sec. 2303(g)(2)(B),
added cl. (VI) and struck out former cl. (VI) which read as follows:
``Loans for personal, family, household, or educational purposes, but
the dollar amount treated as qualified thrift investments under this
subclause may not exceed the amount which is equal to 10 percent of the
savings association's portfolio assets.''
Subsec. (m)(4)(D), (E). Pub. L. 104-208, Sec. 2303(g)(3), added
subpars. (D) and (E).
Subsec. (s)(2)(A). Pub. L. 104-208, Sec. 2201(b)(2), substituted
``under any'' for ``under section 5(d)(3) of the Federal Deposit
Insurance Act or any other''.
Subsec. (t). Pub. L. 104-208, Sec. 2203(a), added subsec. (t).
1992--Subsec. (m)(1), (3)(D). Pub. L. 102-550, Sec. 1606(f)(4),
amended Pub. L. 102-242, Sec. 437. See 1991 Amendment note below.
Subsecs. (s), (t). Pub. L. 102-550, Sec. 1607(b), redesignated
subsec. (t) as (s).
1991--Subsec. (e)(1). Pub. L. 102-242, Sec. 211(1), inserted after
subpar. (B) ``Consideration of the managerial resources of a company or
savings association under subparagraph (B) shall include consideration
of the competence, experience, and integrity of the officers, directors,
and principal shareholders of the company or association.''
Subsec. (e)(2). Pub. L. 102-242, Sec. 211(2)(A), inserted after
second sentence ``Consideration of the managerial resources of a company
or savings association shall include consideration of the competence,
experience, and integrity of the officers, directors, and principal
shareholders of the company or association.''
Subsec. (e)(2)(C), (D). Pub. L. 102-242, Sec. 211(2)(B)-(D), added
subpars. (C) and (D).
Subsec. (m)(1)(A). Pub. L. 102-242, Sec. 437(b)(1), as added by Pub.
L. 102-550, Sec. 1606(f)(4)(B), substituted ``65 percent'' for ``70
percent''.
Subsec. (m)(1)(B). Pub. L. 102-242, Sec. 437(a), as amended by Pub.
L. 102-550, Sec. 1606(f)(4)(A), amended subpar. (B) generally. Prior to
amendment, subpar. (B) read as follows: ``the savings association's
qualified thrift investments continue to equal or exceed 70 percent of
the savings association's portfolio assets, as measured by a daily or
weekly average of such qualified thrift investments and such portfolio
assets, for the 2-year period beginning on July 1, 1991, and for each 2-
year period thereafter.''
Subsec. (m)(3)(D). Pub. L. 102-242, Sec. 437(b)(2), as added by Pub.
L. 102-550, Sec. 1606(f)(4)(B), substituted ``on a monthly average basis
in 9 out of the preceding 12 months'' for ``for the preceding 2-year
period''.
Subsec. (m)(4)(B)(iii). Pub. L. 102-242, Sec. 438, substituted ``20
percent'' for ``10 percent''.
Subsec. (m)(4)(C)(ii). Pub. L. 102-242, Sec. 439(1), added subcl.
(VI).
Subsec. (m)(4)(C)(iii)(VI). Pub. L. 102-242, Sec. 440(a),
substituted ``10 percent'' for ``5 percent''.
Subsec. (m)(4)(C)(iii)(VII). Pub. L. 102-242, Sec. 439(2), added
subcl. (VII).
Subsec. (m)(4)(C)(iv). Pub. L. 102-242, Sec. 440(b), substituted
``20 percent'' for ``15 percent''.
Subsec. (t). Pub. L. 102-242, Sec. 502(a), added subsec. (t).
1989--Pub. L. 101-73, Sec. 301, amended section generally,
substituting subsecs. (a) to (r) relating to regulation of holding
companies for former subsecs. (a) to (d) relating to thrift industry
recovery regulations.
Subsec. (i)(1). Pub. L. 101-73, Sec. 907(k)(1), added par. (1) and
struck out former par. (1) which related to criminal penalties.
Subsec. (i)(2). Pub. L. 101-73, Sec. 907(k)(1), (2), redesignated
par. (3) as (2) and struck out former par. (2) which related to
penalties for making false entries.
Subsec. (i)(3), (4). Pub. L. 101-73, Sec. 907(k)(2), (3),
redesignated par. (4), relating to notice after separation from service,
as (3) and amended par. (3) generally, substituting provisions relating
to and penalties for provisions relating to notice after separation from
service. Former par. (3) redesignated (2). See Codification note above.
Subsec. (i)(5). Pub. L. 101-73, Sec. 905(j), added par. (5).
Subsec. (m). Pub. L. 101-73, Sec. 303(a), amended subsec. (m)
generally, revising and restating as pars. (1) to (7) provisions of
former pars. (1) to (6).
Effective Date of 1996 Amendment
Amendment by section 2704(d)(12)(B) of Pub. L. 104-208 effective
Jan. 1, 1999, if no insured depository institution is a savings
association on that date, see section 2704(c) of Pub. L. 104-208, set
out as a note under section 1821 of this title.
Effective Date of 1992 Amendment
Amendment by Pub. L. 102-550 effective as if included in the Federal
Deposit Insurance Corporation Improvement Act of 1991, Pub. L. 102-242,
as of Dec. 19, 1991, see section 1609(a) of Pub. L. 102-550, set out as
a note under section 191 of this title.
Effective Date of 1989 Amendment
Section 303(b) of Pub. L. 101-73 provided that: ``The amendment made
by subsection (a) [amending this section] shall take effect on July 1,
1991.''
Amendment by section 301 of Pub. L. 101-73 relating to civil
penalties applicable with respect to violations committed and activities
engaged in after Aug. 9, 1989, except that the increased maximum civil
penalties of $5,000 and $25,000 per violation or per day may apply to
such violations or activities committed or engaged in before such date
with respect to an institution if such violations or activities (1) are
not already subject to a notice issued by the appropriate Federal
banking agency or the Board (initiating an administrative proceeding);
and (2) occurred after the completion of the last report of examination
of the institution by the appropriate Federal banking agency (as defined
in section 1813 of this title) occurring before Aug. 9, 1989, see
section 305(c) of Pub. L. 101-73, set out as a note under section 1461
of this title.
Amendment by section 907(k) of Pub. L. 101-73 applicable to conduct
engaged in after Aug. 9, 1989, except that increased maximum penalties
of $5,000 and $25,000 may apply to conduct engaged in before such date
if such conduct is not already subject to a notice issued by the
appropriate agency and occurred after completion of the last report of
the examination of the institution by the appropriate agency occurring
before Aug. 9, 1989, see section 907(l) of Pub. L. 101-73, set out as a
note under section 93 of this title.
Savings Provision
Section 302 of title III of Pub. L. 101-73 provided that:
``Notwithstanding the amendment made by this title to section 10 of the
Home Owners' Loan Act [12 U.S.C. 1467a] and the repeal of section 416 of
the National Housing Act [12 U.S.C. 1730i]--
``(1) any plan approved by the Federal Home Loan Bank Board
under such section 10 for any Federal savings association shall
continue in effect as long as such association adheres to the plan
and continues to submit to the Director of the Office of Thrift
Supervision regular and complete reports on the association's
progress in meeting the association's goals under the plan; and
``(2) any plan approved by the Federal Savings and Loan
Insurance Corporation under such section 416 for any State savings
association shall continue in effect as long as such association
adheres to the plan and continues to submit to the Federal Deposit
Insurance Corporation regular and complete reports on the
association's progress in meeting the savings association's goals
under the plan.''
Rule of Construction for Certain Applications
Pub. L. 106-102, title IV, Sec. 401(c), Nov. 12, 1999, 113 Stat.
1436, provided that:
``(1) In general.--In the case of a company that--
``(A) submits an application with the Director of the Office of
Thrift Supervision before the date of the enactment of this Act
[Nov. 12, 1999] to convert a State-chartered trust company
controlled by such company on May 4, 1999, to a savings association;
and
``(B) controlled a subsidiary on May 4, 1999, that had submitted
an application to the Director on September 2, 1998;
the company (including any subsidiary controlled by such company as of
such date of enactment [Nov. 12, 1999]) shall be treated as having filed
such conversion application with the Director before May 4, 1999, for
purposes of section 10(c)(9)(C) of the Home Owners' Loan Act [12 U.S.C.
1467a(c)(9)(C)] (as added by subsection (a)).
``(2) Definitions.--For purposes of paragraph (1), the terms
`company', `control', `savings association', and `subsidiary' have the
meanings given those terms in section 10 of the Home Owners' Loan Act.''
Associations That Have Previously Failed to Remain Qualified Thrift
Lenders
Section 303(c) of Pub. L. 101-73 provided that: ``If, as of June 30,
1991, any savings association is subject to any provision of section
10(m)(3) of the Home Owners' Loan Act [12 U.S.C. 1467a(m)(3)] as in
effect on that date, the amendment to this subsection made by section
303 of the Financial Institutions Reform, Recovery, and Enforcement Act
of 1989 [Pub. L. 101-73], shall not be construed as reducing the period
specified in section 10(m)(3) of such Act.''
Capital Recovery; Submission of Proposed Regulations to Congress;
Effective Date; Study, Report, and Congressional Review
Section 404(c)-(e) of Pub. L. 100-86 required the Federal Home Loan
Bank Board and the Federal Savings and Loan Insurance Corporation to
each submit a report to Congress containing the proposed regulations
required to be prescribed under 12 U.S.C. 1467a and 1730i of this title
not later than the end of the 90-day period beginning on Aug. 10, 1987;
required the regulations to be implemented not later than the end of the
150-day period beginning on Aug. 10, 1987; and required, not later than
Jan. 31, 1989, a detailed evaluation of, and report the effectiveness
of, the regulations in achieving an increased level of capitalization
for thrift institutions.
Sunset and Savings Provision
Section ceases to be effective on date that notice of completion of
all net new borrowing by Financing Corporation is published in Federal
Register [Mar. 30, 1992, 57 F.R. 10763], with such termination not to be
construed to affect or limit any authority of Federal Home Loan Bank
Board or Federal Savings and Loan Insurance Corporation to prescribe any
regulation or engage in any activity with respect to any association or
insured institution under any other provision of law, see section 416 of
Pub. L. 100-86, set out as a note under section 1441 of this title.
Section Referred to in Other Sections
This section is referred to in sections 1462, 1464, 1467, 1468,
1813, 1817, 1820a, 1823, 1828b, 1841, 1843, 3204 of this title; title 7
section 6f; title 15 sections 18a, 77c, 78o-5, 78q.
