Sec. 502. Common sense economic recovery
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This section may be cited as the . Common Sense Economic Recovery Act of 2013 For purposes of determining capital requirements or measuring capital of an insured depository institution under section 38 of the Federal Deposit Insurance Act (12 U.S.C. 1831o) or any other provision of law or regulatory guidance, an insured depository institution that would otherwise be required to treat a loan as a non-accrual loan may treat such loan as an accrual loan, if— the loan is current; during the previous 6-month period, no monthly payment on the loan has been more than 30 days delinquent; and the payments on the loan are being made pursuant to the contractual terms of the loan agreement and any refinances and modifications that are agreed to by all of the parties.
Notwithstanding paragraph (1), a modified or restructured loan may not be treated as a non-accrual loan if the borrower demonstrates the ability to perform on such a loan— over a period of 6 months; or with respect to a loan on a quarterly, semi-annual, or longer repayment schedule, over a period of 3 consecutive payments. With respect to a loan held by an insured depository institution and treated as an accrual loan by reason of paragraph (1), an appropriate Federal banking agency may not impose any additional accounting requirements on such institution with respect to such loan compared to the requirements that would otherwise have been placed on such institution with respect to such loan if such loan were not being treated as an accrual loan by reason of paragraph (1), if the result of such additional requirement would adversely impact the measurement of capital of the institution.
An appropriate Federal banking agency may not require an insured depository institution to treat a loan as a non-accrual loan solely on the basis that the collateral of such loan has reduced in value. This subsection shall not apply with respect to any issuer of a security registered pursuant to section 12 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78l ). The Financial Stability Oversight Council shall conduct a study of how best to prevent contradictory guidance from being issued by appropriate Federal banking agencies to insured depository institutions with respect to loan classifications and capital requirements.
Not later than the end of the 60-day period beginning on the date of the enactment of this Act, the Financial Stability Oversight Council shall issue a report to the Congress containing— all determinations and conclusions made by the Council in carrying out the study required under paragraph (1); and legislative recommendations that the Council believe will prevent contradictory guidance from being issued by appropriate Federal banking agencies to insured depository institutions with respect to loan classifications and capital requirements.
For purposes of this section: The term appropriate Federal banking agency — has the meaning given such term under section 3 of the Federal Deposit Insurance Act ( 12 U.S.C. 1813 ); and means the National Credit Union Administration Board, in the case of a credit union. The term insured depository institution means— an insured depository institution, as defined under section 3 of the Federal Deposit Insurance Act ( 12 U.S.C. 1813 ); and a credit union. Effective after the end of the 2-year period beginning on the date of the enactment of this Act, this section shall cease to have any force or effect.
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