HR 8075
To authorize the Secretary of the Treasury to direct the Federal Deposit Insurance Corporation and the National Credit Union Administration to establish emergency transaction account guarantee programs, and for other purposes.
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Sign in to take action- Introduced
- Passed House
- Passed Senate
- To President
- Became Law
Bill overview
This bill authorizes the Treasury Secretary to direct the Federal Deposit Insurance Corporation (FDIC) and the National Credit Union Administration (NCUA) to create temporary emergency transaction account guarantee programs. These programs would insure deposits in non-interest-bearing transaction accounts at insured banks and credit unions during times of significant financial stress. The programs would be subject to limitations on size and duration, and any losses would be recovered through assessments on the institutions involved.
Key provisions
- Establishes emergency transaction account guarantee programs for banks and credit unions.
- Requires a determination of a ‘banking stress event’ or ‘credit union stress event’ before program activation.
- Limits the size of the programs and their duration.
- Provides for repayment of losses to the Deposit Insurance Fund through assessments on banks and credit unions.
- Mandates Congressional testimony and GAO review of the programs.
- Defines ‘non-interest-bearing transaction account’ for program eligibility.
- Allows for one-time extensions of the program's duration.
Who is affected
- Insured Depository Institutions (Banks)
- Insured Credit Unions
- Federal Deposit Insurance Corporation (FDIC)
- National Credit Union Administration (NCUA)
- Deposit Insurance Fund
Notable changes
- Creates a new mechanism for emergency deposit insurance during financial crises.
Sponsors
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Primary sponsor
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119th CONGRESS — 2d Session
H. R. 8075
IN THE HOUSE OF REPRESENTATIVES
A BILL
To authorize the Secretary of the Treasury to direct the Federal Deposit Insurance Corporation and the National Credit Union Administration to establish emergency transaction account guarantee programs, and for other purposes.
the Secretary of the Treasury, in consultation with the President, determines that—
a banking stress event exists that presents serious adverse effects on economic conditions or the stability of the banking system; and
use of the program authorized under this subsection would avoid or mitigate such adverse effects; and
Notwithstanding clause (i), the maximum amount of costs for a program established under paragraph (1) may be increased, if—
such increase is approved in the same manner as a program established under paragraph (1); and
the Secretary of the Treasury issues a report to the Congress containing data and analysis justifying the increase.
Notwithstanding clause (i), the termination date for a program established under paragraph (1) may be extended one time for an additional 3-month period, if—
such extension is approved in the same manner as a program established under paragraph (1); and
Not later than 30 days after a program is established under paragraph (1), the Secretary of the Treasury shall testify before the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate with respect to the program.
For purposes of this paragraph, sections 7(c)(2) and 18(h) shall apply to depository institution holding companies as if they were insured depository institutions.
In this subsection:
banking stress eventmeans an exceptional and broad reduction in the stability of deposits at insured depository institutions.
The term non-interest-bearing transaction account
means a transaction account that—
pays a de minimis amount of interest, as established by the Corporation.
transaction accountmeans a deposit or account from which the depositor or account holder is permitted to make transfers or withdrawals by negotiable or transferable instrument, payment order of withdrawal, telephone transfer, or other similar device for the purpose of making payments or transfers to third persons or others or from which the depositor or account holder may make third-party payments at an automated teller machine or a remote service unit, or other electronic device, including by debit card, and includes such other deposits or accounts maintained at an insured depository institution that the Corporation may determine consistent with this definition.
the Secretary of the Treasury, in consultation with the President, determines that—
use of the program authorized under this subsection would avoid or mitigate such adverse effects; and
Notwithstanding subclause (I), the maximum amount of costs for a program established under subparagraph (A) may be increased, if—
such increase is approved in the same manner as a program established under subparagraph (A); and
the Secretary of the Treasury issues a report to the Congress containing data and analysis justifying the increase.
Notwithstanding subclause (I), the termination date for a program established under subparagraph (A) may be extended one time for an additional 3-month period, if—
such extension is approved in the same manner as a program established under subparagraph (A); and
Not later than 30 days after a program is established under subparagraph (A), the Secretary of the Treasury shall testify before the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate with respect to the program.
In this paragraph:
credit union stress eventmeans an exceptional and broad reduction in the stability of shares and deposits at insured credit unions.
The term non-interest-bearing transaction account
means a transaction account that—
pays a de minimis dividend, as established by the Board.
transaction accountmeans a deposit, share, or account from which the depositor or account holder is permitted to make transfers or withdrawals by negotiable or transferable instrument, payment order of withdrawal, telephone transfer, or other similar device for the purpose of making payments or transfers to third persons or others or from which the depositor or account holder may make third-party payments at an automated teller machine or a remote service unit, or other electronic device, including by debit card, and includes such other deposits or accounts maintained at an insured credit union that the Board may determine consistent with this definition.