Bank Accountability and Risk Assessment Act of 2009 - Amends the Federal Deposit Insurance Act to require the risk-based assessment system (used to determine the premiums owed by insured depository institutions) to consider, in addition to existing factors, the risks posed to the Deposit Insurance Fund by: (1) the affiliates of a depository institution; and (2) the off-balance sheet assets and liabilities of depository institutions and their affiliates.
Directs the Federal Deposit Insurance Corporation (FDIC) to impose a systemic risk assessment, at least annually, and in addition to the regular annual assessment and emergency special assessments, on all systemically important depository institutions.
Repeals the declaration that no insured depository institution shall be barred from the lowest-risk category solely because of size. (Thus allows an insured depository institution to be barred from the lowest-risk category solely because of size.)
Bases the regular annual assessment on an assessment rate established by the FDIC and an insured depository institution's average total assets minus its average tangible equity during the assessment period.
[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2897 Introduced in House (IH)]
111th CONGRESS
1st Session
H. R. 2897
To amend the Federal Deposit Insurance Act to return a sense of
fairness and accountability to the deposit insurance premium assessment
process, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
June 16, 2009
Mr. Gutierrez (for himself, Mr. Kanjorski, Mr. Capuano, Ms. Moore of
Wisconsin, and Ms. Lee of California) introduced the following bill;
which was referred to the Committee on Financial Services
_______________________________________________________________________
A BILL
To amend the Federal Deposit Insurance Act to return a sense of
fairness and accountability to the deposit insurance premium assessment
process, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Bank Accountability and Risk
Assessment Act of 2009''.
SEC. 2. FINDINGS AND PURPOSE.
(a) Findings.--Congress makes the following findings:
(1) The unprecedented Government intervention into the
financial markets in 2008 was required by a threat to our
Nation's economy from large, complex, and deeply inter-
connected financial institutions, many of which were on the
verge of failing.
(2) The necessary Government intervention in the financial
system placed hundreds of billions of taxpayer dollars at risk.
(3) Many of the financial institutions involved in the
crisis were so large and their dealings so intertwined that
their failures could have led to the collapse of America's
financial system.
(4) The scale of the banking system crisis put severe
strains on the Deposit Insurance Fund of the Federal Deposit
Insurance Corporation.
(5) The depository institutions that present a systemic
risk to the financial system would overwhelm the resources of
the Deposit Insurance Fund if one or more of them were to fail.
(6) Without a substantial increase in the Deposit Insurance
Fund, depository institutions that are deemed ``too-big-to-
fail'' will remain potential threats to the health of the
entire financial system and possibly place U.S. taxpayer
dollars at risk.
(7) It is inherently unfair to require the financial
institutions that are too small to be systemic risks, or that
do not become involved in the most risky, questionable, and
harmful financial practices, to share the financial
responsibility for the failures of these ``too-big-to-fail''
institutions.
(8) Large depository institutions whose failure may
threaten the safety and soundness of the entire financial
system should be assessed premiums based on their potential
risk to the system, not just on the deposits they hold.
(9) The Deposit Insurance Fund should be insulated against
potential financial crises, the financial institutions that
cause a crisis in the future must be held accountable, and U.S.
taxpayer dollars should not be placed at risk.
(b) Purpose.--The purpose of this Act is to maintain the safety and
soundness of the U.S. banking system by ensuring that the Federal
Deposit Insurance Corporations' Deposit Insurance Fund is adequately
capitalized to respond to the failures of large depository institutions
that would otherwise threaten our financial system and to return a
sense of fairness and accountability to the deposit insurance premium
assessment process.
SEC. 3. ACCOUNTING FOR ACTUAL RISK TO THE DEPOSIT INSURANCE FUND.
(a) Section 7(b)(1)(C) of the Federal Deposit Insurance Act is
amended to read as follows:
``(C) `Risk-based assessment system' defined.--For
purposes of this paragraph, the term `risk-based
assessment system' means a system for calculating a
depository institution's assessment based on--
``(i) the probability that the Deposit
Insurance Fund will incur a loss with respect
to the institution;
``(ii) the likely amount of any such loss;
``(iii) the risks to the Deposit Insurance
Fund attributable to such depository
institution and its affiliates, taking into
account--
``(I) the amount, different
categories, and concentrations of
assets of the insured depository
institution and its affiliates,
including both on-balance sheet and
off-balance sheet assets;
``(II) the amount, different
categories, and concentrations of
liabilities, both insured and
uninsured, contingent and
noncontingent, including both on-
balance sheet and off-balance sheet
liabilities, of the insured depository
institution and its affiliates; and
``(III) any other factors the
Corporation determines are relevant to
assessing the risks; and
``(iv) the revenue needs of the Deposit
Insurance Fund.''.
(b) Section 7(b)(1) of the Federal Deposit Insurance Act is further
amended by redesignating subparagraphs (E) and (F) as subparagraphs (F)
and (G), respectively, and by adding the following new subparagraph
(E):
``(E) Systemic risk premium.--
``(i) In addition to any annual assessment
imposed under paragraph (2) or special
assessment imposed under paragraph (5), the
Board of Directors shall impose a systemic risk
assessment, at least annually, on all
systemically important depository institutions.
For purposes of the subparagraph, `systemically
important depository institution' shall mean an
insured depository institution that is
designated as systemically important by the
Corporation, in consultation with the Secretary
of the Treasury and the Board of Governors of
the Federal Reserve System, or that is an
affiliate of a depository institution holding
company or, in the case of an industrial loan
company, controlling parent company designated
as systemically important by the Corporation,
in consultation with the Secretary of the
Treasury and the Board of Governors of the
Federal Reserve System.
``(ii) In designating an insured depository
institution, depository institution holding
company, or controlling parent company as
systemically important, the Corporation shall
take into account:
``(I) the amount, different
categories, and concentrations of
assets of the entity and its
affiliates, including both on-balance
sheet and off-balance sheet assets;
``(II) the amount, different
categories, and concentrations of
liabilities, both insured and
uninsured, contingent and
noncontingent, including both on-
balance sheet and off-balance sheet
liabilities, of the entity and its
affiliates;
``(III) the activities of the
entity and its affiliates;
``(IV) the relevant market share of
the entity and its affiliates; and
``(V) the potential adverse effects
on economic conditions and financial
stability, in the event any of the
grounds in (c)(5) were to exist with
respect to such entity.''.
(c) Section 7(b)(2) of the Federal Deposit Insurance Act is amended
by striking paragraph (D) and by redesignating subparagraph (C) as
subparagraph (D).
SEC. 4. CREATING A RISK-FOCUSED ASSESSMENT BASE.
Section 7(b)(2), as amended, is further amended by adding the
following new subparagraph (C):
``(C) Assessment base.--The assessment of any
insured depository institution imposed under this
subsection shall be an amount equal to the product of--
``(i) an assessment rate established by the
Corporation; and
``(ii) the amount of the insured depository
institution's average total assets during the
assessment period minus the amount of the
insured depository institution's average
tangible equity during the assesssment
period.''.
<all>
Introduced in House
Introduced in House
Sponsor introductory remarks on measure. (CR E1456)
Referred to the House Committee on Financial Services.
Llama 3.2 · runs locally in your browser
Ask anything about this bill. The AI reads the full text to answer.
Enter to send · Shift+Enter for new line