§ 1815. — Deposit insurance.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 12USC1815]
TITLE 12--BANKS AND BANKING
CHAPTER 16--FEDERAL DEPOSIT INSURANCE CORPORATION
Sec. 1815. Deposit insurance
(a) Application to Corporation required
(1) In general
Except as provided in paragraphs (2) and (3), any depository
institution which is engaged in the business of receiving deposits
other than trust funds (as defined in section 1813(p) of this
title), upon application to and examination by the Corporation and
approval by the Board of Directors, may become an insured depository
institution.
(2) Interim depository institutions
In the case of any interim Federal depository institution that
is chartered by the appropriate Federal banking agency and will not
open for business, the depository institution shall be an insured
depository institution upon the issuance of the institution's
charter by the agency.
(3) Application and approval not required in cases of
continued insurance
Paragraph (1) shall not apply in the case of any depository
institution whose insured status is continued pursuant to section
1814 of this title.
(4) Review requirements
In reviewing any application under this subsection, the Board of
Directors shall consider the factors described in section 1816 of
this title in determining whether to approve the application for
insurance.
(5) Notice of denial of application for insurance
If the Board of Directors votes to deny any application for
insurance by any depository institution, the Board of Directors
shall promptly notify the appropriate Federal banking agency and, in
the case of any State depository institution, the appropriate State
banking supervisor of the denial of such application, giving
specific reasons in writing for the Board of Directors'
determination with reference to the factors described in section
1816 of this title.
(6) Nondelegation requirement
The authority of the Board of Directors to make any
determination to deny any application under this subsection may not
be delegated by the Board of Directors.
(b) Foreign branch nonmember banks; matters considered
Subject to the provisions of this chapter and to such terms and
conditions as the Board of Directors may impose, any branch of a foreign
bank, upon application by the bank to the Corporation, and examination
by the Corporation of the branch, and approval by the Board of
Directors, may become an insured branch. Before approving any such
application, the Board of Directors shall give consideration to--
(1) the financial history and condition of the bank,
(2) the adequacy of its capital structure,
(3) its future earnings prospects,
(4) the general character and fitness of its management,
including but not limited to the management of the branch proposed
to be insured,
(5) the risk presented to the Bank Insurance Fund or the Savings
Association Insurance Fund,
(6) the convenience and needs of the community to be served by
the branch,
(7) whether or not its corporate powers, insofar as they will be
exercised through the proposed insured branch, are consistent with
the purposes of this chapter, and
(8) the probable adequacy and reliability of information
supplied and to be supplied by the bank to the Corporation to enable
it to carry out its functions under this chapter.
(c) Protection to deposit insurance fund; surety bond, pledge of assets,
etc.; injunction
(1) Before any branch of a foreign bank becomes an insured branch,
the bank shall deliver to the Corporation or as the Corporation may
direct a surety bond, a pledge of assets, or both, in such amounts and
of such types as the Corporation may require or approve, for the purpose
set forth in paragraph (4) of this subsection.
(2) After any branch of a foreign bank becomes an insured branch,
the bank shall maintain on deposit with the Corporation, or as the
Corporation may direct, surety bonds or assets or both, in such amounts
and of such types as shall be determined from time to time in accordance
with such regulations as the Board of Directors may prescribe. Such
regulations may impose differing requirements on the basis of any
factors which in the judgment of the Board of Directors are reasonably
related to the purpose set forth in paragraph (4).
(3) The Corporation may require of any given bank larger deposits of
bonds and assets than required under paragraph (2) of this subsection
if, in the judgment of the Corporation, the situation of that bank or
any branch thereof is or becomes such that the deposits of bonds and
assets otherwise required under this section would not adequately
fulfill the purpose set forth in paragraph (4). The imposition of any
such additional requirements may be without notice or opportunity for
hearing, but the Corporation shall afford an opportunity to any such
bank to apply for a reduction or removal of any such additional
requirements so imposed.
(4) The purpose of the surety bonds and pledges of assets required
under this subsection is to provide protection to the deposit insurance
fund against the risks entailed in insuring the domestic deposits of a
foreign bank whose activities, assets, and personnel are in large part
outside the jurisdiction of the United States. In the implementation of
its authority under this subsection, however, the Corporation shall
endeavor to avoid imposing requirements on such banks which would
unnecessarily place them at a competitive disadvantage in relation to
domestically incorporated banks.
(5) In the case of any failure or threatened failure of a foreign
bank to comply with any requirement imposed under this subsection (c),
the Corporation, in addition to all other administrative and judicial
remedies, may apply to any United States district court, or United
States court of any territory, within the jurisdiction of which any
branch of the bank is located, for an injunction to compel such bank and
any officer, employee, or agent thereof, or any other person having
custody or control of any of its assets, to deliver to the Corporation
such assets as may be necessary to meet such requirement, and to take
any other action necessary to vest the Corporation with control of
assets so delivered. If the court shall determine that there has been
any such failure or threatened failure to comply with any such
requirement, it shall be the duty of the court to issue such injunction.
The propriety of the requirement may be litigated only as provided in
chapter 7 of title 5, and may not be made an issue in an action for an
injunction under this paragraph.
(d) Insurance fees
(1) Uninsured institutions
(A) In general
Any institution that becomes insured by the Corporation, and
any noninsured branch that becomes insured by the Corporation,
shall pay the Corporation any fee which the Corporation may by
regulation prescribe, after giving due consideration to the need
to establish and maintain reserve ratios in the Bank Insurance
Fund and the Savings Association Insurance Fund as required by
section 1817 of this title.
(B) Fee credited to appropriate fund
The fee paid by the depository institution shall be credited
to the Bank Insurance Fund if the depository institution becomes
a Bank Insurance Fund member, and to the Savings Association
Insurance Fund if the depository institution becomes a Savings
Association Insurance Fund member.
(C) Exception for certain depository institutions
Any depository institution that becomes an insured
depository institution by operation of section 1814(a) of this
title shall not pay any fee.
(2) Conversions
(A) In general
(i) Prior approval required
No insured depository institution may participate in a
conversion transaction without the prior approval of the
Corporation.
(ii) 5-year moratorium on conversions
Except as provided in subparagraph (C), the Corporation
may not approve any conversion transaction before the later
of the end of the 5-year period beginning on August 9, 1989,
or the date on which the Savings Association Insurance Fund
first meets or exceeds the designated reserve ratio for such
fund.
(B) ``Conversion transaction'' defined
For purposes of this paragraph, the term ``conversion
transaction'' means--
(i) the change of status of an insured depository
institution from a Bank Insurance Fund member to a Savings
Association Insurance Fund member or from a Savings
Association Insurance Fund member to a Bank Insurance Fund
member;
(ii) the merger or consolidation of a Bank Insurance
Fund member with a Savings Association Insurance Fund
member;
(iii) the assumption of any liability by--
(I) any Bank Insurance Fund member to pay any
deposits of a Savings Association Insurance Fund member;
or
(II) any Savings Association Insurance Fund member
to pay any deposits of a Bank Insurance Fund member;
(iv) the transfer of assets of--
(I) any Bank Insurance Fund member to any Savings
Association Insurance Fund member in consideration of
the assumption of liabilities for any portion of the
deposits of such Bank Insurance Fund member; or
(II) any Savings Association Insurance Fund member
to any Bank Insurance Fund member in consideration of
the assumption of liabilities for any portion of the
deposits of such Savings Association Insurance Fund
member; and
(v) the transfer of deposits--
(I) from a Bank Insurance Fund member to a Savings
Association Insurance Fund member; or
(II) from a Savings Association Insurance Fund
member to a Bank Insurance Fund member;
in a transaction in which the deposit is received from a
depositor at an insured depository institution for which a
receiver has been appointed and the receiving insured
depository institution is acting as agent for the
Corporation in connection with the payment of such deposit
to the depositor at the institution for which a receiver has
been appointed.
(C) Approval during moratorium
The Corporation may approve a conversion transaction at any
time if--
(i) the conversion transaction affects an insubstantial
portion, as determined by the Corporation, of the total
deposits of each depository institution participating in the
conversion transaction;
(ii) the conversion occurs in connection with the
acquisition of a Savings Association Insurance Fund member
in default or in danger of default, and the Corporation
determines that the estimated financial benefits to the
Savings Association Insurance Fund or Resolution Trust
Corporation equal or exceed the Corporation's estimate of
loss of assessment income to such insurance fund over the
remaining balance of the moratorium period established by
subparagraph (A), and the Resolution Trust Corporation
concurs in the Corporation's determination; or
(iii) the conversion occurs in connection with the
acquisition of a Bank Insurance Fund member in default or in
danger of default and the Corporation determines that the
estimated financial benefits to the Bank Insurance Fund
equal or exceed the Corporation's estimate of the loss of
assessment income to the insurance fund over the remaining
balance of the moratorium period established by subparagraph
(A).
(D) Certain transfers deemed to affect insubstantial portion of
total deposits
For purposes of subparagraph (C)(i), any conversion
transaction shall be deemed to affect an insubstantial portion
of the total deposits of an insured depository institution, to
the extent the aggregate amount of the total deposits
transferred in such transaction and in all conversion
transactions occurring after August 9, 1989, does not exceed 35
percent of the lesser of--
(i) the amount which is equal to the sum of--
(I) the total deposits of such insured depository
institution on May 1, 1989; and
(II) the total amount of net interest credited to
the depository institution's deposits during the period
beginning on May 1, 1989, and ending on the date of the
transfer of deposits in connection with such
transaction; or
(ii) the amount which is equal to the total deposits of
such insured depository institution on the date of the
transfer of deposits in connection with such transaction.
(E) Exit and entrance fees
Each insured depository institution participating in a
conversion transaction shall pay--
(i) in the case of a conversion transaction in which the
resulting or acquiring depository institution is not a
Savings Association Insurance Fund member, an exit fee (in
an amount to be determined and assessed in accordance with
subparagraph (F)) which--
(I) shall be deposited in the Savings Association
Insurance Fund; or
(II) shall be paid to the Financing Corporation, if
the Secretary of the Treasury determines that the
Financing Corporation has exhausted all other sources of
funding for interest payments on the obligations of the
Financing Corporation and orders that such fees be paid
to the Financing Corporation;
(ii) in the case of a conversion transaction in which
the resulting or acquiring depository institution is not a
Bank Insurance Fund member, an exit fee in an amount to be
determined by the Corporation (and assessed in accordance
with subparagraph (F)(ii)) which shall be deposited in the
Bank Insurance Fund; and
(iii) an entrance fee in an amount to be determined by
the Corporation (and assessed in accordance with
subparagraph (F)(ii)), except that--
(I) in the case of a conversion transaction in which
the resulting or acquiring depository institution is a
Bank Insurance Fund member, the fee shall be the
approximate amount which the Corporation calculates as
necessary to prevent dilution of the Bank Insurance
Fund, and shall be paid to the Bank Insurance Fund; and
(II) in the case of a conversion transaction in
which the resulting or acquiring depository institution
is a Savings Association Insurance Fund member, the fee
shall be the approximate amount which the Corporation
calculates as necessary to prevent dilution of the
Savings Association Insurance Fund, and shall be paid to
the Savings Association Insurance Fund.
(F) Assessment of exit and entrance fees
(i) Determination of amount of exit fees
(I) Conversions before January 1, 1997
In the case of any exit fee assessed under
subparagraph (E)(i) for any conversion transaction
consummated before January 1, 1997, the amount of such
fee shall be determined jointly by the Corporation and
the Secretary of the Treasury.
(II) Assessments after December 31, 1996
In the case of any exit fee assessed under
subparagraph (E)(i) for any conversion transaction
consummated after December 31, 1996, the amount of such
fee shall be determined by the Corporation.
(ii) Procedures
The Corporation shall prescribe, by regulation,
procedures for assessing any exit or entrance fee under
subparagraph (E).
(G) Charter conversion of SAIF members
This subsection shall not be construed as prohibiting any
savings association which is a Savings Association Insurance
Fund member from converting to a bank charter during the period
described in subparagraph (A)(ii) if the resulting bank remains
a Savings Association Insurance Fund member.
(3) Optional conversions subject to special rules on deposit
insurance payments
(A) Conversions allowed
Notwithstanding paragraph (2)(A), and subject to the
requirements of this paragraph, any insured depository
institution may participate in a transaction described in clause
(ii), (iii), or (iv) of paragraph (2)(B) if the transaction is
approved by the responsible agency under section 1828(c)(2) of
this title.
(B) Assessments on deposits attributable to former depository
institution
(i) Assessments by SAIF
In the case of any acquiring, assuming, or resulting
depository institution which is a Bank Insurance Fund
member, that portion of the deposits of such member for any
semiannual period which is equal to the adjusted
attributable deposit amount (determined under subparagraph
(C) with respect to the transaction) shall be treated as
deposits which are insured by the Savings Association
Insurance Fund.
(ii) Assessments by BIF
In the case of any acquiring, assuming, or resulting
depository institution which is a Savings Association
Insurance Fund member, that portion of the deposits of such
member for any semiannual period which is equal to the
adjusted attributable deposit amount (determined under
subparagraph (C) with respect to the transaction) shall be
treated as deposits which are insured by the Bank Insurance
Fund.
(C) Determination of adjusted attributable deposit amount
Except as provided in subparagraph (K), the adjusted
attributable deposit amount which shall be taken into account
for purposes of determining the amount of the assessment under
subparagraph (B) for any semiannual period by any acquiring,
assuming, or resulting depository institution in connection with
a transaction under subparagraph (A) is the amount which is
equal to the sum of--
(i) the amount of any deposits acquired by the
institution in connection with the transaction (as
determined at the time of such transaction);
(ii) the total of the amounts determined under clause
(iii) for semiannual periods preceding the semiannual period
for which the determination is being made under this
subparagraph; and
(iii) the amount by which the sum of the amounts
described in clauses (i) and (ii) would have increased
during the preceding semiannual period (other than any
semiannual period beginning before the date of such
transaction) if such increase occurred at a rate equal to
the annual rate of growth of deposits of the acquiring,
assuming, or resulting depository institution minus the
amount of any deposits acquired through the acquisition, in
whole or in part, of another insured depository institution.
(D) Deposit of assessment
That portion of any assessment under section 1817 of this
title which--
(i) is determined in accordance with subparagraph (B)(i)
shall be deposited in the Savings Association Insurance
Fund; and
(ii) is determined in accordance with subparagraph
(B)(ii) shall be deposited in the Bank Insurance Fund.
(E) Conditions for approval, generally
(i) Information required
An application to engage in any transaction under this
paragraph shall contain such information relating to the
factors to be considered for approval as the responsible
agency may require, by regulation or by specific request, in
connection with any particular application.
(ii) No transfer of deposit insurance permitted
This paragraph shall not be construed as authorizing
transactions which result in the transfer of any insured
depository institution's Federal deposit insurance from 1
Federal deposit insurance fund to the other Federal deposit
insurance fund.
(iii) Capital requirements
A transaction described in this paragraph shall not be
approved under section 1828(c)(2) of this title unless the
acquiring, assuming, or resulting depository institution
will meet all applicable capital requirements upon
consummation of the transaction.
(F) Certain interstate transactions
A Bank Insurance Fund member which is a subsidiary of a bank
holding company may not be the acquiring, assuming, or resulting
depository institution in a transaction under subparagraph (A)
unless the transaction would comply with the requirements of
section 1842(d) of this title if, at the time of such
transaction, the Savings Association Insurance Fund member
involved in such transaction was a State bank that the bank
holding company was applying to acquire.
(G) Allocation of costs in event of default
If any acquiring, assuming, or resulting depository
institution is in default or danger of default at any time
before this paragraph ceases to apply, any loss incurred by the
Corporation shall be allocated between the Bank Insurance Fund
and the Savings Association Insurance Fund, in amounts
reflecting the amount of insured deposits of such acquiring,
assuming, or resulting depository institution assessed by the
Bank Insurance Fund and the Savings Association Insurance Fund,
respectively, under subparagraph (B).
(H) Subsequent approval of conversion transaction
This paragraph shall cease to apply if--
(i) after the end of the moratorium period established
by paragraph (2)(A), the Corporation approves an application
by any acquiring, assuming, or resulting depository
institution to treat the transaction described in
subparagraph (A) as a conversion transaction; and
(ii) the acquiring, assuming, or resulting depository
institution pays the amount of any exit and entrance fee
assessed by the Corporation under subparagraph (E) of
paragraph (2) with respect to such transaction.
(I) ``Acquiring, assuming, or resulting depository institution''
defined
For purposes of this paragraph, the term ``acquiring,
assuming, or resulting depository institution'' means any
insured depository institution which--
(i) results from any transaction described in paragraph
(2)(B)(ii) and approved under this paragraph;
(ii) in connection with a transaction described in
paragraph (2)(B)(iii) and approved under this paragraph,
assumes any liability to pay deposits of another insured
depository institution; or
(iii) in connection with a transaction described in
paragraph (2)(B)(iv) and approved under this paragraph,
acquires assets from any insured depository institution in
consideration of the assumption of liability for any
deposits of such institution.
(J) Redesignated (I)
(K) Adjustment of adjusted attributable deposit amount
The amount determined under subparagraph (C)(i) for deposits
acquired by March 31, 1995, shall be reduced by 20 percent for
purposes of computing the adjusted attributable deposit amount
for the payment of any assessment for any semiannual period that
begins after September 30, 1996 (other than the special
assessment imposed under section 2702(a) of such Act), for a
Bank Insurance Fund member bank that, as of June 30, 1995--
(i) had an adjusted attributable deposit amount that was
less than 50 percent of the total deposits of that member
bank; or
(ii)(I) had an adjusted attributable deposit amount
equal to less than 75 percent of the total assessable
deposits of that member bank;
(II) had total assessable deposits greater than
$5,000,000,000; and
(III) was owned or controlled by a bank holding company
that owned or controlled insured depository institutions
having an aggregate amount of deposits insured or treated as
insured by the Bank Insurance Fund greater than the
aggregate amount of deposits insured or treated as insured
by the Savings Association Insurance Fund.
(e) Liability of commonly controlled depository institutions
(1) In general
(A) Liability established
Any insured depository institution shall be liable for any
loss incurred by the Corporation, or any loss which the
Corporation reasonably anticipates incurring, after August 9,
1989, in connection with--
(i) the default of a commonly controlled insured
depository institution; or
(ii) any assistance provided by the Corporation to any
commonly controlled insured depository institution in danger
of default.
(B) Payment upon notice
An insured depository institution shall pay the amount of
any liability to the Corporation under subparagraph (A) upon
receipt of written notice by the Corporation in accordance with
this subsection.
(C) Notice required to be provided within 2 years of loss
No insured depository institution shall be liable to the
Corporation under subparagraph (A) if written notice with
respect to such liability is not received by such institution
before the end of the 2-year period beginning on the date the
Corporation incurred the loss.
(2) Amount of compensation; procedures
(A) Use of estimates
When an insured depository institution is in default or
requires assistance to prevent default, the Corporation shall--
(i) in good faith, estimate the amount of the loss the
Corporation will incur from such default or assistance;
(ii) if, with respect to such insured depository
institution, there is more than 1 commonly controlled
insured depository institution, estimate the amount of each
such commonly controlled depository institution's share of
such liability; and
(iii) advise each commonly controlled depository
institution of the Corporation's estimate of the amount of
such institution's liability for such losses.
(B) Procedures; immediate payment
The Corporation, after consultation with the appropriate
Federal banking agency and the appropriate State chartering
agency, shall--
(i) on a case-by-case basis, establish the procedures
and schedule under which any insured depository institution
shall reimburse the Corporation for such institution's
liability under paragraph (1) in connection with any
commonly controlled insured depository institution; or
(ii) require any insured depository institution to make
immediate payment of the amount of such institution's
liability under paragraph (1) in connection with any
commonly controlled insured depository institution.
(C) Priority
The liability of any insured depository institution under
this subsection shall have priority with respect to other
obligations and liabilities as follows:
(i) Superiority
The liability shall be superior to the following
obligations and liabilities of the depository institution:
(I) Any obligation to shareholders arising as a
result of their status as shareholders (including any
depository institution holding company or any
shareholder or creditor of such company).
(II) Any obligation or liability owed to any
affiliate of the depository institution (including any
other insured depository institution), other than any
secured obligation which was secured as of May 1, 1989.
(ii) Subordination
The liability shall be subordinate in right and payment
to the following obligations and liabilities of the
depository institution:
(I) Any deposit liability (which is not a liability
described in clause (i)(II)).
(II) Any secured obligation, other than any
obligation owed to any affiliate of the depository
institution (including any other insured depository
institution) which was secured after May 1, 1989.
(III) Any other general or senior liability (which
is not a liability described in clause (i)).
(IV) Any obligation subordinated to depositors or
other general creditors (which is not an obligation
described in clause (i)).
(D) Adjustment of estimated payment
(i) Overpayment
If the amount of compensation estimated by and paid to
the Corporation by 1 or more such commonly controlled
depository institutions is greater than the actual loss
incurred by the Corporation, the Corporation shall reimburse
each such commonly controlled depository institution its pro
rata share of any overpayment.
(ii) Underpayment
If the amount of compensation estimated by and paid to
the Corporation by 1 or more such commonly controlled
depository institutions is less than the actual loss
incurred by the Corporation, the Corporation shall
redetermine in its discretion the liability of each such
commonly controlled depository institution to the
Corporation and shall require each such commonly controlled
depository institution to make payment of any additional
liability to the Corporation.
(3) Review
(A) Judicial
Actions of the Corporation shall be reviewable pursuant to
chapter 7 of title 5.
(B) Administrative
The Corporation shall prescribe regulations and establish
administrative procedures which provide for a hearing on the
record for the review of--
(i) the amount of any loss incurred by the Corporation
in connection with any insured depository institution;
(ii) the liability of individual commonly controlled
depository institutions for the amount of such loss; and
(iii) the schedule of payments to be made by such
commonly controlled depository institutions.
(4) Limitation on rights of private parties
To the extent the exercise of any right or power of any person
would impair the ability of any insured depository institution to
perform such institution's obligations under this subsection--
(A) the obligations of such insured depository institution
shall supersede such right or power; and
(B) no court may give effect to such right or power with
respect to such insured depository institution.
(5) Waiver authority
(A) In general
The Corporation, in its discretion, may exempt any insured
depository institution from the provisions of this subsection if
the Corporation determines that such exemption is in the best
interests of the Bank Insurance Fund or the Savings Association
Insurance Fund.
(B) Condition
During the period any exemption granted to any insured
depository institution under subparagraph (A) or (C) is in
effect, such insured depository institution and all other
insured depository institution affiliates of such depository
institution shall comply fully with the restrictions of sections
371c and 371c-1 of this title without regard to section
371c(d)(1) of this title.
(C) Limited partnerships
(i) In general
The Corporation may, in its discretion, exempt any
limited partnership and any affiliate of any limited
partnership (other than any insured depository institution
which is a majority owned subsidiary of such partnership)
from the provisions of this subsection if such limited
partnership or affiliate has filed a registration statement
with the Securities and Exchange Commission on or before
April 10, 1989, indicating that as of the date of such
filing such partnership intended to acquire 1 or more
insured depository institutions.
(ii) Review and notice
Within 10 business days after the date of submission of
any request for an exemption under this subparagraph
together with such information as shall be reasonably
requested by the Corporation, the Corporation shall make a
determination on the request and shall so advise the
applicant.
(6) 5-year transition rule
During the 5-year period beginning on August 9, 1989--
(A) no Savings Association Insurance Fund member shall have
any liability to the Corporation under this subsection arising
out of assistance provided by the Corporation or any loss
incurred by the Corporation as a result of the default of a Bank
Insurance Fund member which was acquired by such Savings
Association Insurance Fund member or any affiliate of such
member before August 9, 1989; and
(B) no Bank Insurance Fund member shall have such liability
with respect to assistance provided by or loss incurred by the
Corporation as a result of the default of a Savings Association
Insurance Fund member which was acquired by such Bank Insurance
Fund member or any affiliate of such member before August 9,
1989.
(7) Exclusion for institutions acquired in debt collections
Any depository institution shall not be treated as commonly
controlled, for purposes of this subsection, during the 5-year
period beginning on the date of an acquisition described in
subparagraph (A) or such longer period as the Corporation may
determine after written application by the acquirer, if--
(A) 1 depository institution controls another by virtue of
ownership of voting shares acquired in securing or collecting a
debt previously contracted in good faith; and
(B) during the period beginning on August 9, 1989, and
ending upon the expiration of the exclusion, the controlling
bank and all other insured depository institution affiliates of
such controlling bank comply fully with the restrictions of
sections 371c and 371c-1 of this title, without regard to
section 371c(d)(1) of this title, in transactions with the
acquired insured depository institution.
(8) Exception for certain FSLIC assisted institutions
No depository institution shall have any liability to the
Corporation under this subsection as the result of the default of,
or assistance provided with respect to, an insured depository
institution which is an affiliate of such depository institution
if--
(A) such affiliate was receiving cash payments from the
Federal Savings and Loan Insurance Corporation under an
assistance agreement or note entered into before August 9, 1989;
(B) the Federal Savings and Loan Insurance Corporation, or
such other entity which has succeeded to the payment obligations
of such Corporation with respect to such assistance agreement or
note, is unable to continue such payments; and
(C) such affiliate--
(i) is in default or in need of assistance solely as a
result of the failure to meet the payment obligations
referred to in subparagraph (B); and
(ii) is not otherwise in breach of the terms of any
assistance agreement or note which would authorize the
Federal Savings and Loan Insurance Corporation or such other
successor entity, pursuant to the terms of such assistance
agreement or note, to refuse to make such payments.
(9) Commonly controlled defined
For purposes of this subsection, depository institutions are
commonly controlled if--
(A) such institutions are controlled by the same depository
institution holding company (including any company required to
file reports pursuant to section 1843(f)(6) of this title); or
(B) 1 depository institution is controlled by another
depository institution.
(Sept. 21, 1950, ch. 967, Sec. 2[5], 64 Stat. 876; Pub. L. 95-369,
Sec. 6(c)(7), Sept. 17, 1978, 92 Stat. 616; Pub. L. 97-320, title VII,
Sec. 703(c), Oct. 15, 1982, 96 Stat. 1539; Pub. L. 101-73, title II,
Secs. 201(a), 206(a), Aug. 9, 1989, 103 Stat. 187, 195; Pub. L. 102-242,
title I, Sec. 115(a), title III, Sec. 302(e)(1), (2), title V,
Sec. 501(a), Dec. 19, 1991, 105 Stat. 2249, 2349, 2388; Pub. L. 102-550,
title XVI, Secs. 1605(a)(5)(B), 1607(a), Oct. 28, 1992, 106 Stat. 4085,
4089; Pub. L. 102-558, title III, Secs. 303(b)(6)(B), 305, Oct. 28,
1992, 106 Stat. 4225, 4226; Pub. L. 103-204, Sec. 9, Dec. 17, 1993, 107
Stat. 2388; Pub. L. 103-325, title III, Sec. 319(b), title VI,
Sec. 602(a)(2), (3), Sept. 23, 1994, 108 Stat. 2225, 2288; Pub. L. 104-
208, div. A, title II, Secs. 2201(a), 2702(i), 2704(d)(14)(B)-(E), Sept.
30, 1996, 110 Stat. 3009-403, 3009-483, 3009-491.)
References in Text
Section 2702(a) of the Deposit Insurance Funds Act of 1996, referred
to in subsec. (d)(3)(K), is section 2702(a) of Pub. L. 104-208, which is
set out as a note under section 1817 of this title.
Prior Provisions
Section is derived from subsec. (f)(2) of former section 264 of this
title. See Codification note set out under section 1811 of this title.
Amendments
1996--Subsec. (b)(5). Pub. L. 104-208, Sec. 2704(d)(14)(B), which
directed substitution of ``Deposit Insurance Fund,'' for ``the Bank
Insurance Fund or the Savings Association Insurance Fund;'', was not
executed. See Effective Date of 1996 Amendment note below.
Subsec. (d). Pub. L. 104-208, Sec. 2704(d)(14)(C) and (D), which
directed the amendment of subsec. (d) by striking out par. (1)
designation and heading, redesignating subpar. (A) of par. (1) as par.
(1), realigning margin, and substituting ``the reserve ratio of the
Deposit Insurance Fund'' for ``reserve ratios in the Bank Insurance Fund
and the Savings Association Insurance Fund'', striking out subpar. (B)
of par. (1) and pars. (2) and (3) and adding new par. (2), and
redesignating subpar. (C) of par. (1) as par. (3) and realigning margin,
was not executed. See Effective Date of 1996 Amendment note below.
Subsec. (d)(3)(A). Pub. L. 104-208, Sec. 2201(a)(1), substituted
``if the transaction is approved by'' for ``with the prior written
approval of''.
Subsec. (d)(3)(C). Pub. L. 104-208, Sec. 2702(i)(1), substituted
``Except as provided in subparagraph (K), the adjusted attributable
deposit amount'' for ``The adjusted attributable deposit amount'' in
introductory provisions.
Subsec. (d)(3)(E). Pub. L. 104-208, Sec. 2201(a)(2), added cl.
(iii), redesignated former cls. (ii) and (iii) as (i) and (ii),
respectively, and struck out former cls. (i) and (iv), which directed
review of any application under the procedures and factors set forth in
section 1828(c) of this title and disapproval of any application unless
depository institution met all applicable capital requirements,
respectively.
Subsec. (d)(3)(G) to (J). Pub. L. 104-208, Sec. 2201(a)(3), (4),
redesignated subpars. (H) to (J) as (G) to (I), respectively and struck
out former subpar. (G) which related to expedited approval of
acquisitions.
Subsec. (d)(3)(K). Pub. L. 104-208, Sec. 2702(i)(2), added subpar.
(K).
Subsec. (e)(5)(A). Pub. L. 104-208, Sec. 2704(d)(14)(E)(i), which
directed substitution of ``Deposit Insurance Fund'' for ``Bank Insurance
Fund or the Savings Association Insurance Fund'', was not executed. See
Effective Date of 1996 Amendment note below.
Subsec. (e)(6) to (9). Pub. L. 104-208, Sec. 2704(d)(14)(E)(ii),
(iii), which directed striking out par. (6) and redesignating pars. (7)
to (9) as (6) to (8), respectively, was not executed. See Effective Date
of 1996 Amendment note below.
1994--Subsec. (b)(5). Pub. L. 103-325, Sec. 602(a)(2), substituted
comma for semicolon at end.
Subsec. (d)(3)(A). Pub. L. 103-325, Sec. 319(b)(1), redesignated cl.
(i) formerly entitled ``In general'' as subpar. (A), inserted comma
after ``Notwithstanding paragraph (2)(A)'', and struck out heading and
text of cl. (ii). Text read as follows: ``If, in connection with any
transaction referred to in clause (i), the acquiring, assuming, or
resulting depository institution is a Bank Insurance Fund member which
is a subsidiary of a bank holding company, the prior written approval of
the Board shall be required for such transaction in addition to the
approval of any agency referred to in clause (i).''
Subsec. (d)(3)(E)(i). Pub. L. 103-325, Sec. 319(b)(2)(A), struck out
``(and, in the event the acquiring, assuming, or resulting depository
institution is a Bank Insurance Fund member which is a subsidiary of a
bank holding company, the Board)'' after ``responsible agency''.
Subsec. (d)(3)(E)(ii). Pub. L. 103-325, Sec. 319(b)(2)(B), struck
out ``or Board'' after ``responsible agency''.
Subsec. (d)(3)(E)(iv). Pub. L. 103-325, Sec. 319(b)(2)(C), struck
out ``, and the appropriate Federal banking agency for any depository
institution holding company,'' after ``responsible agency'', ``each''
before ``such agency determines'', and ``, and any depository
institution holding company which controls such institution,'' after
``resulting depository institution''.
Subsec. (d)(3)(F). Pub. L. 103-325, Sec. 319(b)(3), substituted ``A
Bank'' for ``The Board may not approve any transaction under
subparagraph (A) in which the acquiring, assuming, or resulting
depository institution is a Bank'' and ``may not be the acquiring,
assuming, or resulting depository institution in a transaction under
subparagraph (A) unless'' for ``unless the Board determines that''.
Subsec. (d)(3)(K). Pub. L. 103-325, Sec. 319(b)(4), struck out
heading and text of subpar. (K). Text read as follows: ``For purposes of
this paragraph, the term `Board' (other than when such term appears in
connection with a reference to the Board of Directors) means the Board
of Governors of the Federal Reserve System.''
Subsec. (e)(4). Pub. L. 103-325, Sec. 602(a)(3), redesignated cls.
(i) and (ii) as subpars. (A) and (B), respectively, and realigned
margins.
1993--Subsec. (d)(2)(A)(ii). Pub. L. 103-204, Sec. 9(a), substituted
``before the later of the end'' for ``before the end'' and inserted
before period at end ``or the date on which the Savings Association
Insurance Fund first meets or exceeds the designated reserve ratio for
such fund''.
Subsec. (d)(2)(B)(v). Pub. L. 103-204, Sec. 9(b), added cl. (v).
Subsec. (d)(2)(C)(ii), (iii), (3)(I)(i). Pub. L. 103-204, Sec. 9(c),
substituted ``moratorium period established by'' for ``5-year period
referred to in''.
1992--Subsec. (d)(3)(B). Pub. L. 102-558, Sec. 303(b)(6)(B), amended
directory language of Pub. L. 102-242, Sec. 302(e). See 1991 amendment
note below. Pub. L. 102-550, Sec. 1605(a)(5)(B), which contained an
identical amendment, was repealed, effective Oct. 28, 1992, by Pub. L.
102-558, Sec. 305, set out as a Repeal of Duplicative Provisions note
below.
Subsec. (d)(3)(K). Pub. L. 102-550, Sec. 1607(a), added subpar. (K).
1991--Pub. L. 102-242, Sec. 115(a), amended section catchline.
Subsec. (a). Pub. L. 102-242, Sec. 115(a), added subsec. (a)
consisting of pars. (1) to (6) and struck out former subsec. (a)
relating to application for insurance, which consisted of pars. (1) to
(7).
Subsec. (d)(3). Pub. L. 102-242, Sec. 501(a), amended par. (3)
generally, substituting present provisions consisting of subpars. (A) to
(J) for provisions related to optional conversion through merger, which
consisted of subpars. (A) to (G).
Subsec. (d)(3)(B)(i). Pub. L. 102-242, Sec. 302(e)(1), as amended by
Pub. L. 102-558, Sec. 303(b)(6)(B), substituted ``deposits'' for
``average assessment base'' and ``shall be treated as deposits which are
insured by the Savings Association Insurance Fund.'' for ``shall--
``(I) be subject to assessment at the assessment rate applicable
under section 1817 of this title for Savings Association Insurance
Fund members;
``(II) not be taken into account for purposes of any assessment
under section 1817 of this title for Bank Insurance Fund members;
and
``(III) be treated as deposits which are insured by the Savings
Association Insurance Fund.''
Subsec. (d)(3)(B)(ii). Pub. L. 102-242, Sec. 302(e)(2), as added by
Pub. L. 102-558, Sec. 303(b)(6)(B), substituted ``deposits'' for
``average assessment base'' and ``shall be treated as deposits which are
insured by the Bank Insurance Fund.'' for ``shall--
``(I) be subject to assessment at the assessment rate applicable
under section 1817 of this title for Bank Insurance Fund members;
``(II) not be taken into account for purposes of any assessment
under section 1817 of this title for Savings Association Insurance
Fund members; and
``(III) be treated as deposits which are insured by the Bank
Insurance Fund.''
1989--Pub. L. 101-73, Sec. 201(a), substituted references to insured
depository institutions for references to insured banks wherever
appearing.
Subsec. (a). Pub. L. 101-73, Sec. 206(a)(1)-(4), inserted heading,
designated existing provisions as par. (1), inserted par. (1) heading,
and substituted ``Any'' for ``Subject to the provisions of this chapter,
any'', inserted ``and State savings association'' after ``any State
nonmember bank'' and after ``such State nonmember bank'', ``or savings
association'' after ``such bank'', and ``or savings association, and in
the case of an application by a State savings association, the
Corporation shall notify the Director of the Office of Thrift
Supervision of the Corporation's approval of such application'' after
``books of the bank'', and added pars. (2) to (7).
Subsec. (b)(4). Pub. L. 101-73, Sec. 206(a)(5), inserted ``and
fitness'' after ``character''.
Subsec. (b)(5) to (8). Pub. L. 101-73, Sec. 206(a)(6), added par.
(5) and redesignated former pars. (5) to (7) as (6) to (8),
respectively.
Subsecs. (d), (e). Pub. L. 101-73, Sec. 206(a)(7), added subsecs.
(d) and (e).
1982--Subsec. (a). Pub. L. 97-320 inserted provision relating to the
determination before the application of an industrial bank or similar
institution is approved that it is chartered and operating under
provisions substantially comparable to those applicable to banks
operating in the same State.
1978--Pub. L. 95-369 designated existing provision as subsec. (a)
and added subsecs. (b) and (c).
Effective Date of 1996 Amendment
Amendment by section 2704(d)(14)(B)-(E) 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 Amendments
Amendment by section 303(b)(6)(B) of Pub. L. 102-558 deemed to have
become effective Mar. 1, 1992, see section 304 of Pub. L. 102-558, set
out as a note under section 2062 of Title 50, Appendix, War and National
Defense.
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, except that where amendment is to any provision of
law added or amended by Pub. L. 102-242 effective after Dec. 19, 1992,
then amendment by Pub. L. 102-550 effective on effective date of
amendment by Pub. L. 102-242, see section 1609 of Pub. L. 102-550, set
out as a note under section 191 of this title.
Effective Date of 1991 Amendment
Amendment by section 302(e)(1), (2) of Pub. L. 102-242 effective on
earlier of 180 days after date on which final regulations promulgated in
accordance with section 302(c) of Pub. L. 102-242, set out as a note
under section 1817 of this title, become effective or Jan. 1, 1994, see
section 302(g) of Pub. L. 102-242, set out as a note under section 1817
of this title.
Section 501(b) of Pub. L. 102-242 provided that: ``The amendment
made by subsection (a) to section 5(d)(3)(C) of the Federal Deposit
Insurance Act [12 U.S.C. 1815(d)(3)(C)] shall apply with respect to
semiannual periods beginning after the date of the enactment of this Act
[Dec. 19, 1991].''
Repeal of Duplicative Provisions
Section 305 of Pub. L. 102-558 provided that: ``In the event of the
enactment of H.R. 5334 (An Act to amend and extend certain laws relating
to housing and community development, and for other purposes) [enacted
as Pub. L. 102-550], the following provisions of that Act, and the
amendments made by such provisions, are repealed, effective on the date
of enactment of this Act [Oct. 28, 1992]:
``(1) Section 1603(a)(3) of such Act [amending section 1817 of
this title and enacting provisions set out as a note under section
1817 of this title].
``(2) Section 1604(a)(11) of such Act [amending section 3104 of
this title].
``(3) Paragraphs (1), (2), and (3) of section 1604(b) of such
Act [amending sections 1817, 1834, and 1834a of this title].
``(3) [sic] Paragraphs (2) through (7) of section 1605(a) of
such Act [amending sections 1815, 1817, 1818, 1820, 1834, and 1834a
of this title and enacting provisions set out as notes under
sections 1817, 1834, and 1834a of this title].''
Newly Insured Thrift Provision
Section 206(b) of Pub. L. 101-73 provided that: ``Any insured
depository institution (as defined in section 3(c)(2) of the Federal
Deposit Insurance Act [12 U.S.C. 1813(c)(2)], as added by section 204(c)
of this Act)--
``(1) which was an insured institution (as defined in section
401(a) of the National Housing Act [12 U.S.C. 1724(a)], as in effect
before the date of the enactment of this Act [Aug. 9, 1989]) on the
day before the date of the enactment of this Act;
``(2) the board of directors of which determined, before April
1, 1987, to terminate such association's status as an insured
institution (as so defined) as evidenced in sworn minutes of the
board of directors meeting held before such date;
``(3) had insured deposits of less than $11,000,000 on April 1,
1987; and
``(4) was an insured institution (as so defined) for less than 1
year as of April 1, 1987,
may cease to be a Savings Association Insurance Fund member and become a
Bank Insurance Fund member at any time during the 2-year period
beginning on the date of the enactment of this Act without the approval
of the Federal Deposit Insurance Corporation under section 5(d)(2) of
the Federal Deposit Insurance Act [12 U.S.C. 1815(d)(2)] (as added by
subsection (a) of this section) and without incurring any liability for
any exit or entrance fee imposed under such section 5(d)(2).''
Section Referred to in Other Sections
This section is referred to in sections 215c, 461, 1441, 1464,
1467a, 1814, 1816, 1821, 3104 of this title; title 26 section 593.
