12 U.S.C. § 1811: Federal Deposit Insurance Corporation

There is hereby established a Federal Deposit Insurance Corporation (hereinafter referred to as the “Corporation”) which shall insure, as hereinafter provided, the deposits of all banks and savings associations which are entitled to the benefits of insurance under this chapter, and which shall have the powers hereinafter granted. The Corporation shall have a separate division of asset disposition. The division of asset disposition shall have an administrator who shall be appointed by the Board of Directors. The division of asset disposition shall carry out all of the responsibilities of the Corporation under this chapter relating to the liquidation of insured depository institutions and the disposition of assets of such institutions. the authority of any State or political subdivision of any State to adopt, apply, or administer any tax or method of taxation to any bank, bank holding company, or foreign bank, or any affiliate of any such bank, bank holding company, or foreign bank, to the extent that such tax or tax method is otherwise permissible by or under the Constitution of the United States or other Federal law; the right of any State, or any political subdivision of any State, to impose or maintain a nondiscriminatory franchise tax or other nonproperty tax instead of a franchise tax in accordance with section 3124 of title 31 , United States Code; or the applicability of section 5197 of the Revised Statutes [ section 85 of this title ] or section 27 of the Federal Deposit Insurance Act [ section 1831d of this title ].” efforts to deny access to or degrade, disrupt, or destroy any information and communications technology system or network, or exfiltrate information from such a system or network without authorization; destructive malware attacks; denial of service activities; and any other efforts that may threaten the functions of the banking regulator or entities overseen by the regulator by undermining cybersecurity and the resilience of the financial system; the appointment of qualified staff, the provision of staff training, the use of accountability measures to support staff performance, and the designation, if any, of senior appointed leadership to strengthen accountability for oversight of cybersecurity measures within each banking regulator and among regulated entities; deployment of adequate resources and technologies; efforts of the banking regulators to respond to cybersecurity-related findings and recommendations of the Inspector General of the banking regulator or the independent evaluation described under section 3555 of title 42 , United States Code; industry efforts to respond to cybersecurity-related findings and recommendations of the banking regulators; as appropriate, efforts to strengthen cybersecurity in coordination with other Federal departments and agencies, domestic and foreign financial institutions, and other partners, including the development and dissemination of best practices regarding cybersecurity and the sharing of threat information; and any current or emerging threats that are likely to pose a risk to the resilience of the financial system. The report required under subsection (a) shall be submitted in unclassified form, but may include a classified annex, if appropriate. the Chairman of the Board of Governors of the Federal Reserve System may designate another member of the Board of Governors of the Federal Reserve System to provide such briefing; the Chairperson of the Federal Deposit Insurance Corporation may designate another member of the Board of Directors of the Corporation to provide such briefing; and the Chairman of the National Credit Union Administration may designate another member of the National Credit Union Administration Board to provide such briefing. The Chairman and Ranking Member of the Committee on Financial Services of the House of Representatives. The Chairman and Ranking Member of the Committee on Banking, Housing, and Urban Affairs of the Senate. The term ‘banking regulator’ means the Board of Governors of the Federal Reserve System, the Comptroller of the Currency, the Federal Deposit Insurance Corporation, and the National Credit Union Administration. With respect to a banking regulator, the term ‘senior appointed leadership’ means a position that requires Senate confirmation. The provisions of this section shall have no force or effect on or after the date that is 7 years after the date of enactment of this Act [ Dec. 27, 2020 ].” the Year 2000 computer problem poses a serious challenge to the American economy, including the Nation’s banking and financial services industries; thousands of banks, savings associations, and credit unions rely heavily on internal information technology and computer systems, as well as outside service providers, for mission-critical functions, such as check clearing, direct deposit, accounting, automated teller machine networks, credit card processing, and data exchanges with domestic and international borrowers, customers, and other financial institutions; and Federal financial regulatory agencies must have sufficient examination authority to ensure that the safety and soundness of the Nation’s financial institutions will not be at risk. the terms ‘depository institution’ and ‘Federal banking agency’ have the same meanings as in section 3 of the Federal Deposit Insurance Act [ 12 U.S.C. 1813 ]; the term ‘Federal home loan bank’ has the same meaning as in section 2 of the Federal Home Loan Bank Act [ 12 U.S.C. 1422 ]; the term ‘Federal reserve bank’ means a reserve bank established under the Federal Reserve Act [ 12 U.S.C. 221 et seq.]; the term ‘insured credit union’ has the same meaning as in section 101 of the Federal Credit Union Act [ 12 U.S.C. 1752 ]; and the 20th and 21st centuries; or the years 1999 and 2000; or with regard to leap year calculations. the safe and sound operations of such depository institutions and credit unions; and transactions with other financial institutions, including Federal reserve banks and Federal home loan banks. The content and schedule of seminars offered pursuant to subparagraph (A) shall be determined by each Federal banking agency and the National Credit Union Administration Board taking into account the resources and examination priorities of such agency. Each Federal banking agency and the National Credit Union Administration Board shall make available to each depository institution and insured credit union under the jurisdiction of such agency model approaches to common Year 2000 computer problems, such as model approaches with regard to project management, vendor contracts, testing regimes, and business continuity planning. In developing model approaches to the Year 2000 computer problem pursuant to subparagraph (A), each Federal banking agency and the National Credit Union Administration Board shall take into account the need to develop a variety of approaches to correspond to the variety of depository institutions or credit unions within the jurisdiction of the agency. In carrying out this section, the Federal banking agencies and the National Credit Union Administration Board may cooperate and coordinate their activities with each other, the Financial Institutions Examination Council, and appropriate organizations representing depository institutions and credit unions.” individual consumers and households; communities; agriculture; small-, medium-, and large-sized businesses; governmental and nonprofit entities; and exporters and other users of international financial services. the changes underway in the national and international economies and the financial services industry, and how those changes affect the financial services system’s ability to efficiently meet the needs of the national economy and the system’s users during the next 10 years and beyond; and the adequacy of existing statutes and regulations, and the existing regulatory structure, to meet the needs of the financial services system’s users effectively, efficiently, and without unfair, anticompetitive, or discriminatory practices. the Board of Governors of the Federal Reserve System; the Commodity Futures Trading Commission; the Comptroller of the Currency; the Director of the Office of Thrift Supervision; the Federal Deposit Insurance Corporation; the Secretary of the Department of Housing and Urban Development; the Securities and Exchange Commission; the Director of the Congressional Budget Office; and the Comptroller General of the United States. There is established the Advisory Commission on Financial Services (hereafter in this section referred to as the ‘Advisory Commission’). users of the financial services system; or experts in finance or on the financial services system; and who are not employees of the Federal Government; and shall include representatives of business, agriculture, and consumers. The Secretary or the Secretary’s designee shall serve as Chairperson of the Advisory Commission. Members of the Advisory Commission shall be allowed travel expenses, including per diem in lieu of subsistence, at rates authorized for employees of agencies under subchapter I of chapter 57 of title 5, United States Code, while away from their homes or regular places of business in performing services for the Advisory Commission. The Advisory Commission shall terminate 30 days after the date of submission of the report required under subsection (d). meet the needs of, and assure access to the system for, current and potential users; promote economic growth; protect consumers; promote competition and efficiency; avoid risk to the taxpayers; control systemic risk; and eliminate discrimination. Not later than 15 months after the date of enactment of this Act [ Sept. 29, 1994 ], the Secretary shall submit to the President pro tempore of the Senate and the Speaker of the House of Representatives a report describing the study conducted under subsection (a) and any recommendations developed under subsection (c).” To promote, through regulatory reform, a safe and stable system of affordable housing finance. To improve the supervision of savings associations by strengthening capital, accounting, and other supervisory standards. To curtail investments and other activities of savings associations that pose unacceptable risks to the Federal deposit insurance funds. To promote the independence of the Federal Deposit Insurance Corporation from the institutions the deposits of which it insures, by providing an independent board of directors, adequate funding, and appropriate powers. To put the Federal deposit insurance funds on a sound financial footing. To establish an Office of Thrift Supervision in the Department of the Treasury, under the general oversight of the Secretary of the Treasury. To establish a new corporation, to be known as the Resolution Trust Corporation, to contain, manage, and resolve failed savings associations. To provide funds from public and private sources to deal expeditiously with failed depository institutions. To strengthen the enforcement powers of Federal regulators of depository institutions. To strengthen the civil sanctions and criminal penalties for defrauding or otherwise damaging depository institutions and their depositors.” The Secretary of the Treasury, in consultation with the Comptroller of the Currency, the Chairman of the Board of Governors of the Federal Reserve System, the Director of the Office of Thrift Supervision, the Chairperson of the Federal Deposit Insurance Corporation, the Chairman of the National Credit Union Administration Board, the Director of the Office of Management and Budget, and individuals from the private sector, shall conduct a study of the Federal deposit insurance system. asset quality risk; interest rate risk; quality of management; and profitability and capital. limiting each depositor to 1 insured account per institution; reducing the amount insured, or providing for a graduated decrease in the percentage of the amounts deposited which are insured as the amounts deposited increase; combining Federal with private insurance in order to bring the market discipline of private insurance to bear on the management of the depository institution; and ensuring, by law or regulation, that on the closing of any insured depository institution, the appropriate Federal insurance fund will honor only its explicit liabilities, and will never make good any losses on deposits not explicitly covered by Federal deposit insurance. The scope of deposit insurance coverage and its impact on the liability of the insurance fund. The feasibility of market value accounting, assessments on foreign deposits, limitations on brokered deposits, the addition of collateralized borrowings to the deposit insurance base, and multiple insured accounts. uniform exemptions; limits on exemptions when necessary to repay obligations owed to federally insured depository institutions; and requiring borrowers from federally insured depository institutions to post a personal or corporate bond when obtaining a mortgage on real property. Policies to be followed with respect to the recapitalization or closure of insured depository institutions whose capital is depleted to, or near the point of, insolvency. The efficiency of housing subsidies through the Federal home loan bank system. Alternatives to Federal deposit insurance. The feasibility of developing and administering, through the appropriate Federal banking agency, an examination of the principles and techniques of risk management and the application of such principles and techniques to the management of insured institutions. The adequacy of capital of insured credit unions and the National Credit Union Share Insurance Fund, including whether the supervision of such fund should be separated from the other functions of the National Credit Union Administration. independent auditors and accountants of a depository institution report the results of any audit of the institution to the relevant regulatory agency or agencies; a regulator share reports on a depository institution with the institution’s independent auditors and accountants; and independent auditors and accountants participate in conferences between the regulator and the depository institution. The feasibility of adopting regulations which are the same as or similar to the provisions of England’s Banking Act, 1987, ch. 22 (4 Halsbury’s Statutes of England and Wales 527–650 (1987)), enacted on May 15, 1987 , relating to the Bank of England’s relationship with auditors and reporting accountants (including sections 8, 39, 41, 45, 46, 47, 82, 83, 85, and 94 of such Act). Not later than the close of the 18-month period beginning on the date of the enactment of this Act [ Aug. 9, 1989 ], the Secretary of the Treasury shall submit to the Congress a final report containing a detailed statement of findings made, and conclusions drawn from, the study conducted under this section, including such recommendations for administrative and legislative action as the Secretary determines to be appropriate. certain retail banking services provided by insured depository institutions; and the fees, if any, which are imposed by such institutions for providing any such service, including fees imposed for not sufficient funds, deposit items returned, and automated teller machine transactions. The Board of Governors of the Federal Reserve System shall prepare a report of the results of each survey conducted pursuant to subsection (a). a description of any discernible trend, in the Nation as a whole, in each of the 50 States, and in each consolidated metropolitan statistical area or primary metropolitan statistical area (as defined by the Director of the Office of Management and Budget), in the cost and availability of retail banking services (including fees imposed for providing such services), that delineates differences between insured depository institutions on the basis of both the size of the institution and any engagement of the institution in multistate activity; and An increase or decrease in the amount of any deposit insurance premium assessed by the Federal Deposit Insurance Corporation against insured depository institutions. An increase or decrease in the amount of the fees imposed by such institutions for providing retail banking services. A decrease in the availability of such services. The Board of Governors of the Federal Reserve System shall submit an annual report to the Congress not later than September 1, 1995 , and not later than June 1 of each subsequent year. analysis of the policy considerations affecting the scope of deposit insurance coverage; evaluation of the risks associated with bank insurance contracts both as to the issuing institution and the deposit insurance funds; and market discipline; and the ability of other participants in capital markets to raise funds. Not later than the close of the 18-month period beginning on the date of the enactment of this Act [ Aug. 9, 1989 ], the Comptroller General shall submit to the Congress the results of the study required by subsection (a). the financial soundness and stability of the government-sponsored enterprises; minimizing any potential financial exposure of the Federal Government; and minimizing any potential impact on borrowing of the Federal Government. The Comptroller General shall determine the structure and methodology of the study under this section in consultation with and with the cooperation of the Secretary of Agriculture and the Farm Credit Administration (with respect to the Farm Credit Banks, the Banks for Cooperatives, and the Federal Agricultural Mortgage Corporation), the Secretary of Education (with respect to the Student Loan Marketing Association and the College Construction Loan Corporation), the Secretary of Housing and Urban Development (with respect to the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation), and the government-sponsored enterprises. Each government-sponsored enterprise shall provide full and prompt access to the Comptroller General to its books and records and shall promptly provide any other information requested by the Comptroller General. In conducting the study under this section, the Comptroller General may request information from, or the assistance of, any department or agency of the Federal Government that is authorized by law to supervise or approve any of the activities of any government-sponsored enterprise. the degrees and types of risks that are undertaken by the government-sponsored enterprises in the course of their operations, including credit risk, interest rate risk, management and operational risk, and business risk; the most appropriate method or methods for quantifying the types of risks undertaken by the government-sponsored enterprises; the actual level of risk that exists with respect to each government-sponsored enterprise, which shall take into account factors including the volume and type of securities outstanding that are issued or guaranteed by each government-sponsored enterprise and the extent of off-balance sheet expense of each government-sponsored enterprise; the appropriateness of applying a risk-based capital standard to each government-sponsored enterprise, taking into account the nature of the business each government-sponsored enterprise conducts; the costs and benefits to the public from application of a risk-based capital standard to the government-sponsored enterprises and the impact of such a standard on the capability of each government-sponsored enterprise to carry out its purpose under law; the impact, if any, of the operation of the government-sponsored enterprises on borrowing of the Federal Government; the overall level of capital appropriate for each of the government-sponsored enterprises; and the quality and timeliness of information currently available to the public and the Federal Government concerning the extent and nature of the activities of government-sponsored enterprises and the financial risk associated with such activities. the results of the study under this section; any recommendations of the Comptroller General with respect to appropriate capital standards for each government-sponsored enterprise; the extent and nature of the activities of the government-sponsored enterprises; and the nature of any periodic reports that the Comptroller General believes should be submitted to the Congress relating to the capital condition and operations of the government-sponsored enterprises; and any recommendations and opinions of the Secretary of Agriculture, the Secretary of Education, the Secretary of Housing and Urban Development, and the Secretary of the Treasury regarding the report, to the extent that the recommendations and views of such officers differ from the recommendations and opinions of the Comptroller General. For purposes of this section, the term ‘government-sponsored enterprises’ means the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association, the Federal Home Loan Bank System, the Farm Credit Banks, the Banks for Cooperatives, the Federal Agricultural Mortgage Corporation, the College Construction Loan Insurance Corporation, the Student Loan Marketing Association.” The Secretary of the Treasury shall consult with the appropriate Federal banking agencies and the National Credit Union Administration Board on methods for increasing the use of underutilized minority banks, women’s banks, and limited income credit unions as depositaries or financial agents of Federal agencies. The Secretary of the Treasury shall include, in the 1st annual report submitted to the Congress under section 331(a) of title 31 , United States Code, after the completion of the consultation required by subsection (a), a report of the actions taken by the Secretary to increase the use of underutilized minority banks, women’s banks, and limited income credit unions as depositaries or financial agents of Federal agencies. The term ‘appropriate Federal banking agency’ has the meaning given to such term in section 3(q) of the Federal Deposit Insurance Act [ 12 U.S.C. 1813(q) ]. more than 50 percent of the ownership or control of which is held by 1 or more minority individuals; and more than 50 percent of the net profit or loss of which accrues to 1 or more minority individuals. The term ‘minority’ means any Black American, Native American, Hispanic American, or Asian American. The term ‘low-income credit union’ means any depository institution described in section 19(b)(1)(A)(iv) of the Federal Reserve Act which serves predominately low-income members (as defined by the National Credit Union Administration Board pursuant to section 101(5) of the Federal Credit Union Act [ 12 U.S.C. 1752(5) ]). more than 50 percent of the outstanding shares of which are held by 1 or more women; a majority of the directors on the board of directors of which are women; and a significant percentage of senior management positions of which are held by women.” whether, and to what extent, the issuance of securities by the United States Government in small denominations benefits small investors, increases the participation of small investors in United States Government securities offerings, and promotes savings and thrift by the average United States taxpayer; and additional measures the Secretary recommends be taken to expand the availability of securities issued by the United States Government to benefit small investors, increase their participation in United States Government securities offerings, and to promote savings and thrift by the average United States taxpayer.” In order to better manage the bonded indebtedness of the United States, the Secretary shall conduct 2 annual studies to assess the financial safety and soundness of the activities of all Government-sponsored enterprises and the impact of their operations on Federal borrowing. Each Government-sponsored enterprise shall provide full and prompt access to the Secretary to its books and records, and shall promptly provide any other information requested by the Secretary. In conducting the studies under this section, the Secretary may request information from, or the assistance of, any Federal department or agency authorized by law to supervise the activities of any Government-sponsored enterprise. The Secretary shall determine and maintain the confidentiality of any book, record, or information made available under this subsection in a manner generally consistent with the level of confidentiality established for the material by the Government-sponsored enterprise involved. The Department of the Treasury shall be exempt from section 552 of title 5 , United States Code, with respect to any book, record, or information made available under this subsection and determined by the Secretary to be confidential under subparagraph (A). by virtue of his employment or official position, he has possession of or access to any book, record, or information made available under this subsection and determined by the Secretary to be confidential under subparagraph (A); and to an officer or employee of the Department of the Treasury; or pursuant to the exceptions set forth in such section 1906. In assessing the financial safety and soundness of the activities of Government-sponsored enterprises, and the impact of their activities on Federal borrowing, the Secretary shall quantify the risks associated with each Government-sponsored enterprise. In quantifying such risks, the Secretary shall determine the volume and type of securities outstanding which are issued or guaranteed by each Government-sponsored enterprise, the capitalization of each Government-sponsored enterprise, and the degree of risk involved in the operations of each Government-sponsored enterprise due to factors such as credit risk, interest rate risk, management and operations risk, and business risk. The Secretary shall also report on the quality and timeliness of information currently available to the public and the Federal Government concerning the extent and nature of the activities of Government-sponsored enterprises and the financial risk associated with such activities. by May 15, 1990 , a report setting forth the results of the 1st annual study conducted under this section; and by May 15, 1991 , a report setting forth the results of the 2nd annual study conducted under this section. the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, the Federal Home Loan Bank System, the Farm Credit Banks, the Banks for Cooperatives, the Federal Agricultural Mortgage Corporation, the Student Loan Marketing Association, the College Construction Loan Insurance Association, and any of their affiliated or member institutions; and any other Government-sponsored enterprise, as designated by the Secretary. The term ‘Secretary’ means the Secretary of the Treasury or his delegate.”