State Insurance Regulation Preservation Act
This bill amends the Home Owners' Loan Act to limit the applicability of reporting and filing requirements for insurance savings and loan holding companies (ISLHCs). Such holding companies shall also be exempt from requirements relating to examination and supervision by the Federal Reserve Board (FRB) if they meet certain state and federal capital requirements. Certain FRB regulations as applied to ISLHCs must be tailored to the insurance business and applicable state insurance requirements.
[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5059 Introduced in House (IH)]
<DOC>
115th CONGRESS
2d Session
H. R. 5059
To amend the Home Owners' Loan Act with respect to the registration and
supervision of insurance savings and loan holding companies, and for
other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 15, 2018
Mr. Rothfus (for himself and Mrs. Beatty) introduced the following
bill; which was referred to the Committee on Financial Services
_______________________________________________________________________
A BILL
To amend the Home Owners' Loan Act with respect to the registration and
supervision of insurance savings and loan holding companies, 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 ``State Insurance Regulation
Preservation Act''.
SEC. 2. SUPERVISION OF INSURANCE SAVINGS AND LOAN HOLDING COMPANIES.
(a) Definitions.--Section 10(a)(1) of the Home Owners' Loan Act (12
U.S.C. 1467a(a)(1)) is amended by adding at the end the following:
``(K) Insurance savings and loan holding company.--
The term `insurance savings and loan holding company'
means--
``(i) a top-tier savings and loan holding
company that is an insurance underwriting
company;
``(ii) a savings and loan holding company
that held 75 percent or more of its total
consolidated assets in an insurance
underwriting company or insurance underwriting
companies, other than assets associated with
insurance for credit risk, during the 4 most
recent consecutive quarters, as calculated in
accordance with generally accepted accounting
principles or the Statutory Accounting
Principles of the National Association of
Insurance Commissioners, as applicable; or
``(iii) a top-tier savings and loan holding
company that--
``(I) was registered as a savings
and loan holding company before July
21, 2010; and
``(II) is a New York not-for-profit
corporation formed for the purpose of
holding the stock of a New York
insurance company.
``(L) Insurance underwriting company.--The term
`insurance underwriting company' means an entity that
is--
``(i) engaged in the business of insurance;
``(ii) subject to regulation by a State
insurance regulator; and
``(iii) covered by a State law that is
designed to specifically deal with the
rehabilitation, liquidation, or insolvency of
an insurance company.
``(M) Material subsidiary.--The term `material
subsidiary'--
``(i) means a subsidiary that has--
``(I) off-balance sheet activities
not less than $5,000,000,000;
``(II) equity capital not less than
5 percent of the consolidated equity
capital of the top-tier holding
company; or
``(III) consolidated operating
revenue not less than 5 percent of the
consolidated operating revenue of the
top-tier holding company; and
``(ii) does not include a subsidiary that
is--
``(I) a functionally regulated
subsidiary;
``(II) a nonoperating shell holding
company; or
``(III) primarily engaged in--
``(aa) servicing activities
for the holding company or its
affiliates, including the
activities described in section
225.22(b)(2) of title 12, Code
of Federal Regulations; or
``(bb) internal financial
activities, as that term is
defined in section 10A(a).''.
(b) Registration and Examination.--Section 10(b) of the Home
Owners' Loan Act (12 U.S.C. 1467a(b)) is amended--
(1) in paragraph (1), by inserting ``, and which shall, if
applicable, provide for a savings and loan holding company to
register as an insurance savings and loan holding company''
before the period at the end of the first sentence;
(2) in paragraph (2)--
(A) in subparagraph (A), by striking ``Each savings
and loan holding company'' and inserting ``Subject to
subparagraph (D), each savings and loan holding
company'';
(B) in subparagraph (C)--
(i) by striking ``Upon'' and inserting the
following:
``(i) In general.--Upon''; and
(ii) by adding at the end the following:
``(ii) Insurance savings and loan
companies.--In the case of an insurance savings
and loan holding company--
``(I) clause (i) shall not apply;
and
``(II) the Board shall submit a
request for any information described
in clauses (i) through (iii) of
subparagraph (B) to the appropriate
Federal or State regulatory
agencies.''; and
(C) by adding at the end the following:
``(D) Insurance savings and loan holding
companies.--An insurance savings and loan holding
company may be required only to file reports related
to--
``(i) the organizational structure of the
company and any changes in that structure;
``(ii) transactions between the company and
its affiliates;
``(iii) balance sheet and income statements
of a material subsidiary of the company; and
``(iv) the capital holdings of the company
in relation to applicable minimum capital
standards.'';
(3) in paragraph (3), by inserting ``, other than an
insurance savings and loan holding company,'' after
``company''; and
(4) in paragraph (4)--
(A) in subparagraph (A), by inserting ``and
subparagraph (D)'' after ``2010''; and
(B) by adding at the end the following:
``(D) Insurance savings and loan holding
companies.--
``(i) Tailored examinations and
supervision.--Board examinations of, and
supervisory guidance applicable to, an
insurance savings and loan holding company
shall be based upon a supervisory framework
that is--
``(I) tailored to the risks and
activities of the business of
insurance; and
``(II) developed in consultation
with State insurance authorities to
ensure that such framework does not
duplicate or conflict with State
insurance requirements.
``(ii) Exemption for companies that meet
applicable capital standards.--Subject to
clause (iii), the Board shall neither examine
nor apply supervisory guidance to an insurance
savings and loan holding company, or any
subsidiary of an insurance savings and loan
holding company (other than a material
subsidiary), if such company--
``(I) meets or exceeds applicable
State insurance capital standards; and
``(II) meets or exceeds any minimum
capital standards for an insurance
savings and loan holding company
promulgated by the Board under section
171 of the Financial Stability Act of
2010 (12 U.S.C. 5371).
``(iii) Corrective action plan.--
``(I) In general.--If, based upon a
capital report submitted pursuant to
paragraph (2)(D)(iv), an insurance
savings and loan holding company is not
in compliance with any applicable
minimum capital standards, the Board
shall provide a notice of noncompliance
to the company and require the company
to submit, within 45 days of the
receipt of such notice, a plan to
restore the capital of the company to a
level that meets the applicable minimum
standards not later than the later of--
``(aa) 1 year after the
date on which the plan is
submitted; or
``(bb) a date determined by
the Board.
``(II) Failure to submit plan.--If
a company fails to submit a required
capital restoration plan, or fails to
restore capital to applicable minimum
standards within the time period
specified in the plan, the Board,
following notice and an opportunity for
a hearing, may prohibit the application
of clause (ii) to the company until the
later of--
``(aa) the date on which
the company has met applicable
minimum capital standards for 2
calendar years; or
``(bb) a date determined by
the Board.''.
(c) Administration and Enforcement.--Section 10(g) of the Home
Owners' Loan Act (12 U.S.C. 1467a(g)) is amended--
(1) in paragraph (1), by inserting ``In issuing any
regulation, order, or supervisory guidance applicable to an
insurance savings and loan holding company, including a
regulation, order, or guidance related to capital, stress
testing, and cybersecurity, the Board shall tailor such
regulation, order, or guidance to the risks and activities of
the business of insurance and shall consult with State
insurance authorities to ensure that the regulation, order, or
guidance does not duplicate or conflict with State insurance
requirements.'' after the period at the end; and
(2) in paragraph (2), by inserting ``In the case of an
insurance savings and loan holding company, the authority of
the Board to conduct investigations shall be limited to the
material subsidiaries of the insurance savings and loan holding
company.'' after the period at the end.
(d) Intermediate Holding Companies.--Section 10A(d) of the Home
Owners' Loan Act (12 U.S.C. 1467b(d)) is amended by adding at the end
the following:
``(3) Insurance savings and loan holding companies.--If the
Board requires a grandfathered unitary savings and loan holding
company that is an insurance savings and loan holding company
to establish an intermediary holding company to engage in
financial activities, the intermediary holding company shall be
treated as an insurance savings and loan holding company for
purposes of supervision and regulation by the Board.''.
(e) Emergency Supervisory Authority.--Section 10 of the Home
Owners' Loan Act (12 U.S.C. 1467a) is amended by adding the following
new subsection at the end thereof:
``(u) Emergency Supervisory Authority.--The Board, by order, may
suspend the application of paragraphs (2)(C)(ii), (2)(D), and (4)(D) of
subsection (c) and the final sentences of paragraphs (1) and (2) of
subsection (g) to an insurance savings and loan holding company and
apply subsection (b)(3) to an insurance savings and loan holding
company if the Board, after consultation with the State insurance
authority for the insurance savings and loan holding company,
reasonably determines that the operations and activities of the
insurance savings and loan holding company pose a serious and imminent
risk to the financial safety and soundness or stability of the
insurance savings and loan holding company's subsidiary saving
association.''.
SEC. 3. ASSESSMENTS AND FEES FOR INSURANCE SAVINGS AND LOAN HOLDING
COMPANIES.
Section 11 of the Federal Reserve Act (12 U.S.C. 248) is amended,
in the second subsection (s) (relating to assessments), by adding at
the end the following:
``(3) Excluded assets.--With respect to an insurance
savings and loan holding company, as defined in section 10 of
the Home Owners' Loan Act (12 U.S.C. 1467a), the total
consolidated assets described in paragraph (2)(B) shall not
include any asset of an insurance company.''.
<all>
Introduced in House
Introduced in House
Sponsor introductory remarks on measure. (CR E194)
Referred to the House Committee on Financial Services.
Committee Consideration and Mark-up Session Held.
Ordered to be Reported (Amended) by Voice Vote.
Reported (Amended) by the Committee on Financial Services. H. Rept. 115-937.
Reported (Amended) by the Committee on Financial Services. H. Rept. 115-937.
Placed on the Union Calendar, Calendar No. 728.
Mr. Rothfus moved to suspend the rules and pass the bill, as amended.
Considered under suspension of the rules. (consideration: CR H8124-8127)
DEBATE - The House proceeded with forty minutes of debate on H.R. 5059.
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Passed/agreed to in House: On motion to suspend the rules and pass the bill, as amended Agreed to by voice vote.(text: CR H8124-8125)
On motion to suspend the rules and pass the bill, as amended Agreed to by voice vote. (text: CR H8124-8125)
Motion to reconsider laid on the table Agreed to without objection.
Received in the Senate and Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.