Sec. 10. Custodial deposit program for covered minority depository institutions

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The Secretary of the Treasury shall establish a custodial deposit program (in this section referred to as the Program ) under which a covered bank shall receive monthly deposits from a qualifying account. A covered bank shall submit to the Secretary an application to participate in the Program at such time, in such manner, and containing such information as the Secretary may determine. The Secretary shall designate eligible custodial entities to make monthly deposits with covered banks selected for participation in the Program on behalf of a qualifying account.

The Secretary shall establish a custodial deposit account for each qualifying account with the eligible custodial entity designated to make deposits with covered banks for each such qualifying account. The Secretary shall deposit a total amount not greater than 5 percent of a qualifying account into any custodial deposit accounts established under subparagraph (A). Each month, each eligible custodial entity designated by the Secretary shall deposit an amount not greater than the insured amount, in the aggregate, from each custodial deposit account, in a single covered bank.

With respect to the funds of an individual qualifying account, the eligible custodial entity may not deposit an amount greater than the insured amount in a single covered bank. In this subparagraph, the term insured amount means the amount that is the greater of— the standard maximum deposit insurance amount (as defined in section 11(a)(1)(E) of the Federal Deposit Insurance Act ( 12 U.S.C. 1821(a)(1)(E) )); or such higher amount negotiated between the Secretary and the Corporation under which the Corporation will insure all deposits of such higher amount.

The total amount of funds deposited under the Program in a covered bank may not exceed the lesser of— 10 percent of the average amount of deposits held by such covered bank in the previous quarter; or $100,000,000. Each eligible custodial entity designated by the Secretary shall— collect interest from each covered bank in which such custodial entity deposits funds pursuant to paragraph (2); and disburse such interest to the Secretary each month. The rate of any interest collected under this paragraph may not exceed 50 percent of the discount window primary credit interest rate most recently published on the Federal Reserve Statistical Release on selected interest rates (daily or weekly), commonly referred to as the H.15 release (commonly known as the Federal funds rate ).

Each eligible custodial entity designated by the Secretary shall submit to the Secretary monthly statements that include the total amount of funds deposited with, and interest rate received from, each covered bank by the eligible custodial entity on behalf of qualifying entities. The Secretary shall issue a quarterly report to Congress and make publicly available a record identifying all covered banks participating in the Program and amounts deposited under the Program in covered banks.

Deposits made with covered banks under this section may not— be considered by the Corporation to be funds obtained, directly or indirectly, by or through any deposit broker for deposit into 1 or more deposit accounts (as described under section 29 of the Federal Deposit Insurance Act ( 12 U.S.C. 1831f )); or be subject to insurance fees from the Corporation that are greater than insurance fees for typical demand deposits not obtained, directly or indirectly, by or through any deposit broker (commonly known as core deposits ).

The Secretary shall provide a 3-month period for public notice and comment before making any material change to the operation of the Program. The requirements of paragraph

(1)shall not apply if the Secretary makes a material change to the Program to comply with safety and soundness standards or other law. A covered bank selected for participation in the Program pursuant to subsection

(c)may terminate participation in the Program by providing the Secretary a notification 60 days prior to termination. The Secretary may terminate the participation of a covered bank in the Program if the Secretary determines the covered bank— violated any terms of participation in the Program; failed to comply with Federal bank secrecy laws, as documented in writing by the primary regulator of the covered bank; failed to remain well capitalized; or failed comply with safety and soundness standards, as documented in writing by the primary regulator of the covered bank. In this section: The term Corporation means the Federal Deposit Insurance Corporation. The term covered bank means a minority depository institution that is regulated by the Corporation or the National Credit Union Administration that is well capitalized (as defined in section 38(b) of the Federal Deposit Insurance Act ( 12 U.S.C. 1831o(b) )). The term eligible custodial entity means— an insured depository institution (as defined in section 3 of the Federal Deposit Insurance Act ( 12 U.S.C. 1813 )); an insured credit union (as defined in section 101 of the Federal Credit Union Act ( 12 U.S.C. 1752 )); or a well capitalized State-chartered trust company, designated by the Secretary under subsection (c)(1). The term Federal bank secrecy laws means— section 21 of the Federal Deposit Insurance Act ( 12 U.S.C. 1829b ); section 123 of Public Law 91–508 ; and subchapter II of chapter 53 of title 31, United States Code. The term qualifying account means any account established in the Department of the Treasury that— is controlled by the Secretary; and is expected to maintain a balance greater than $200,000,000 for the following calendar month. The term Secretary means the Secretary of the Treasury. The term well capitalized has the meaning given in section 38 of the Federal Deposit Insurance Act ( 12 U.S.C. 1831o ).

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