Safe Banking Act

Safe Banking Act - Title I: Supervisory Authority Over Depository Institutions - Creates civil penalties for specified insider's loans and loans to affiliates prohibited by the Federal Reserve Act, for violations of reserve requirements relating to one borrower loan limits.

Amends the Federal Reserve Act to prohibit member banks from making loans to insiders under specified conditions.

Amends the Bank Holding Company Act of 1956 to authorize the Board of Governors of the Federal Reserve System to order the termination of control or ownership by a bank holding company of any of its nonbank subsidiaries whenever they constitute a serious risk to financial safety of a subsidiary bank of the holding company.

Amends the National Housing Act by authorizing the Federal Savings and Loan Insurance Corporation to order the termination of ownership or control of any noninsured subsidiary by a savings and loan holding company whenever there is reasonable cause to believe that continued ownership constitutes unsafe and inconsistent banking practice.

Grants authority to the Federal Savings and Loan Insurance Corporation to make loans to a savings and loan association in order that it may buy the assets of a failing savings and loan institution so as to prevent the failure of such institution.

Prescribes penalties for the violation of any provision of this Title.

Authorizes financial regulatory agencies, including the National Credit Union Administration and the Federal Home Loan Bank Board, to initiate cease and desist actions against officers, directors, stockholders, or any person participating in the affairs of a financial institution (as well as against the institution itself as is allowed by current law) when there have been violations of laws and regulations or unsafe and unsound banking practices which are likely to seriously weaken the condition of the institution in question.

Sets forth a procedure to be followed for removal of any officer or director for breach of fiduciary duty. Increases the allowable mortgage and education loans to executive officers of banks. Creates a hearing process for removal of a bank officer or director based on an indictment for or conviction of a felony.

Title II: Interlocking Directors - Depository Institution Management Interlocking Act - Prohibits interlocking management and director relations between any depository institutions or depository holding companies located in the same metropolitan area. States that this prohibition applies without regard to geographical limits where such an institution has assets exceeding $1,000,000,000 and seeks an interlocking relationship with any institution with assets over $500,000,000.

Delegates authority for the enforcement of this Act.

Title III: Foreign Branching - Amends the Federal Deposit Insurance Act to prohibit any State nonmember insured bank from operating any foreign branch without prior written consent of the Federal Deposit Insurance Corporation (FDIC).

States that when the liabilities of an insured bank for deposits are assumed by another insured bank the following shall occur: (1) the insured status of the bank whose liabilities are assumed shall terminate on the date of receipt by the FDIC of evidence of such assumption; (2) termination of separate insurance of all assumed deposits at the end of six months from the effective date; and (3) notification of such assumption by the assuming bank to each of the depositors of the assumed bank.

Title IV: Conflicts of Interest - Depository Institutions Conflict of Interest Act - Amends the Federal Deposit Insurance Act, the Federal Reserve Act and the Federal Home Loan Bank Act to prohibit specified Presidential-appointee bank regulatory agency heads and members of such agencies from being employed for a period of two years after they leave office by institutions under their regulatory jurisdiction or with a holding company affiliate.

Title V: Credit Union Restructuring - Reorganizes the National Credit Union Administration and places it under the management of the National Credit Union Administration Board.

Directs the chairperson of such Board to represent the Administration in its official relations with other branches of Government.

Requires each Federal credit union to pay the Administration an annual operating fee and to make annual financial reports to the Board.

Title VI: Change in Bank Control Act - Amends the Federal Deposit Insurance Act to prohibit any person from acquiring any insured bank unless the appropriate Federal banking agency has been notified and has not issued a notice of its disapproval within a specified time period. Prescribes the procedure to be followed by any agency in making its determination to approve or deny such change of control.

Title VII: Change in Savings and Loan Control Act - Amends the National Housing Act to prohibit any person from acquiring control of any federally insured savings and loan association unless the Federal Deposit Insurance Corporation has been notified and has not issued a notice of its disapproval within a specified time period. Prescribes the procedure to be followed by the Corporation in making its determination to approve or deny such change of control.

Requires any insured institution to disclose any loan secured, or to be secured, by 25 percent or more of the outstanding voting stock of an insured institution to the Corporation.

Prescribes civil penalties for violations of this Title.

Title VIII: Correspondent Accounts - Prohibits the extension of credit to any officer, director, or specified stockholders of a bank which has a correspondent relationship with the lending bank, in its own name or in the name of another bank, unless such loan does not: (1) involve more than the normal risk of repayment; (2) include unusual terms of interest or collateral; or (3) present any other unfavorable features.

Prohibits the establishment of a correspondent account where a loan already has been made to any officer, director, or specified stockholders of the bank desiring to open the account.

Prescribes civil penalties for violations of this Title.

Title IX: Disclosure of Material Facts - Amends the Federal Deposit Insurance Act to list information which must be included in an annual report to be made by each insured bank to the appropriate Federal banking agency.

Title X: Federal Bank Examination Council - Federal Bank Examination Council Act - Establishes a Bank Examination Council to prescribe uniform principles and standards for the Federal examination of financial institutions.

Directs the Council to make recommendations for uniformity in other supervisory matters, including classification of loans subject to risk and identification of financial institutions in need of special supervisory attention.

Requires the Council to establish a liaison committee composed of five representatives of State supervisory agencies in order to encourage the application of uniform examination principles and standards by State and Federal supervisory agencies.

Title XI: Right to Financial Privacy - Right to Financial Privacy Act - Prohibits any Government official from obtaining copies of, access to, or the information contained in, the financial records of any customer from a financial institution unless such records are described with particularity and: (1) such customer has authorized such disclosure in accordance with this Act; (2) such records are disclosed in response to an administrative subpena or summons; (3) such records are disclosed in response to a court order; (4) such records are disclosed in response to a judicial subpena; or (5) such financial records are disclosed in response to a formal written request meeting specified requirements.

States that no financial institution may provide to a Government official copies of or the information contained in the financial records of any customer except in accordance with the requirements of this Act.

Sets forth provisions governing customer authorization, administrative subpenas and summons, judicial subpenas, and search warrants.

Prescribes civil and criminal penalties for violation of the provisions of this Title.

Title XII: Charters for Thrift Institutions - Amends the Home Owners' Loan Act to authorize the Home Loan Bank Board to provide for the organization, chartering operation, and regulation of associations to be known as Federal Savings and Loan Associations or Federal mutual savings banks.

Subjects converting mutual savings banks to the requirements of existing State law pertaining to discrimination in the extension of home mortgage loans if the State requirements are more stringent than Federal laws and regulations.

Establishes a five year shared risk program in the event that a converting institution fails.

Title XIII: Holding Companies - Prohibits bank mergers or acquisitions by bank holding companies if such transactions would result in a monopoly, furtherance of a combination or conspiracy to monopolize, or substantially lessen competition in any section of the country unless such anticompetitive effects are clearly outweighed in the public interest by the probable effect of the transaction in meeting the convenience and needs of the community to be served. Prohibits such transactions if the appropriate regulatory agency finds that as a result of such a transaction any one bank or holding company will control more than 20 percent of the banking assets held by banks in the States in which such bank or holding company is located. Excepts from such 20 percent prohibition a transaction which the appropriate agency finds to be immediately necessary to prevent the probable failure of a bank and a less anticompetitive alternative is not available. Gives the appropriate agency discretion to prohibit such a transaction even if it is not disallowed by any other part of this Act if it is found to have probable adverse effects on competition or market concentration which are not clearly outweighed by the public interest.

Prohibits any national bank from engaging in any activity which the Board finds to be an improper activity for bank holding companies in general, or the holding company owning the bank in question, in particular.

Requires bank holding companies and their subsidiaries to be capitalized in a safe and sound manner and to refrain from discriminating in making loans in favor of their parent holding company or their affiliated subsidiaries.

Requires regular reports to the Board dealing with all intercompany loans.

Sets forth procedures for administration of this Act and for judicial review.

Gives to any interested person the right to petition the Board to commence a proceeding to consider the issuance, amendment, or revocation of a regulation promulgated here under.

Title XIV: Amendments to the National Banking Laws - Makes changes with respect to the following: (1) the power of national banks to purchase, hold, and convey real property; (2) the trust powers of national banks; (3) the emergency restrictions on Federal Reserve banks; and (4) examination of foreign operations of State member banks.

Title XV: Termination of National Bank Closed Receivership Fund - Directs the Comptroller of the Currency to disburse the liquidating dividends from national banks closed on or before January 22, 1934, held by the Comptroller in the capacity as successor to receivers of those banks.

Title XVI: Transaction Accounts - Permits any depository institution chartered by the Federal Home Loan Bank Board and located in a State which authorizes State-chartered institutions insured by the Federal Savings and Loan Insurance Corporation to offer transaction accounts permitting withdrawals or transfers of account on negotiable, transferable, or nonnegotiable check, order, or authorization, as determined by the Board, to offer comparable services to the extent authorized by the Board.

Title XVII: Effective Date - Sets forth the effective date for this Act.