Sec. 6. Issuance of payment stablecoins by non-depository trust companies
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/bill/118/s/4155/is/section-6·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
A non-depository trust company may issue and redeem payment stablecoins and conduct other activities in accordance with this section and section 4(g) if the value of all outstanding payment stablecoins in total does not exceed $10,000,000,000, as adjusted under section 3(b). If a non-depository trust company exceeds the threshold described in paragraph (1), the non-depository trust company shall, not later than 180 days after exceeding the threshold— consistent with subsection (k), file a completed application with the Comptroller or State bank supervisor, as applicable, to convert to a depository institution charter under section 7 and be approved as provided in that section; or in consultation with the State bank supervisor, implement a plan to appropriately limit activities below the threshold, consistent with the safety and soundness of the non-depository trust company and customer protection.
A non-depository trust company shall submit to a State bank supervisor, separately or as part of a charter application, an application for authorization to issue payment stablecoins. The State bank supervisor may consult with the Board with respect to the following exclusive set of standards prior to approving an application under subparagraph (A): The ability of the applicant to maintain required reserves backing the payment stablecoins. The financial resources, managerial or technical expertise, and governance of the applicant.
The benefit to the public, including relating to innovation and competition. The stability of the financial system of the United States. Not later than 180 days after the approval of an application under paragraph (1), a non-depository trust company shall register with the Board by submitting to the Board a complete registration statement. The Board may extend the deadline under clause
(i)by an additional 180 days, if the Board determines appropriate. Consistent with section 15 of this Act, the Board, in consultation with State bank supervisors, shall issue rules describing the content, documents, and materials required to be submitted to the Board that constitute a complete registration statement, which shall include materials required to be filed in an application to comply with the standards under paragraph (1)(B). If the State bank supervisor determines that an applicant has submitted all of the materials required under this subparagraph, the registration shall be deemed complete. An approval of an application under paragraph
(1)shall be deemed effective on the date that is 90 days after the date the applicant submits a complete registration statement to the Board under paragraph (2), unless the Board, by a vote of 2/3 of all members, votes to deny the application by written order explaining the reasons for denial. Upon the request of an applicant, the Board may extend the effective date under clause (i). A non-depository trust company may not issue payment stablecoins before the effective date under subparagraph (A). Nothing in this subsection shall be construed as prohibiting the Board from requesting further information from an applicant, but any request by the Board for further information from an applicant shall not affect the status of the registration statement as complete, as provided under paragraph (2)(B)(ii). The Board shall make each registration statement filed with the Board under this section available to the public on the website of the Board. The Board shall consult with the applicable State bank supervisor relating to a non-depository trust company registration under this section, which may include sharing materials submitted as part of the application to issue a payment stablecoin. Upon the filing of a complete registration statement with the Board, a non-depository trust company shall be subject to supervision by the State bank supervisor, and the Board and State bank supervisor shall have enforcement authority as provided in section 11. The applicable State bank supervisor shall make regular examinations of a non-depository trust company authorized to issue a payment stablecoin under this section on a regular basis in order to inform such State bank supervisor of— the nature of the operations and financial condition of the non-depository trust company and any affiliates; the financial, operational, and other risks within the non-depository trust company that may pose a threat to— the safety and soundness of the non-depository trust company; or the stability of the financial system of the United States; and the systems of the non-depository trust company for monitoring and controlling the risks described in subparagraph (B). At the frequency established by rule of the Board, in consultation with State bank supervisors, each non-depository trust company subject to this section shall submit a report of condition under oath to the applicable State bank supervisor relating to— the financial condition and status of systems for monitoring and controlling financial and operating risks of the non-depository trust company; and compliance by the non-depository trust company, and any subsidiary thereof, with this Act and other applicable laws. In supervising a non-depository trust company under this section, a State bank supervisor shall, to the fullest extent possible, use existing reports and other supervisory information and avoid duplication of examination activities, reporting requirements, and requests for information. Each State bank supervisor shall promptly provide to the Board all reports under subsection
(d)and reports of examinations under this section. A non-depository trust company that issues a payment stablecoin under this section shall maintain reserves of not less than 100 percent of the nominal value of all outstanding payment stablecoins issued by the non-depository trust company, as of the end of each business day. A non-depository trust company may maintain reserves comprised of— United States coins, currency, or other instrument that is legal tender described in section 5103 of title 31, United States Code; demand deposits at a depository institution, except that deposits in an insured depository institution shall not exceed the limit of deposit or share insurance available for that account; United States Treasury bills, bonds, or notes with a maturity date of 90 days or less from the date of purchase; and repurchase agreements, with a maturity date of 7 days or less, that are backed by United States Treasury bills with a maturity date of 1 year or less from the date of the repurchase agreement. A non-depository trust company shall be the legal custodian of required payment stablecoin reserves under subsection (f), but the non-depository trust company shall use a depository institution as subcustodian to provide for the safekeeping of reserves. A non-depository trust company that issues a payment stablecoin under this section shall be deemed to be a financial institution for the purposes of title V of the Gramm-Leach-Bliley Act ( 15 U.S.C. 6801 et seq. ). The Board, in consultation with the State bank supervisors and the Financial Crimes Enforcement Network, shall adopt rules to implement this section, including— a simplified capital treatment for non-depository trust companies under this section, which shall be exceed the greater of the projected receivership costs of the non-depository trust company or the projected costs of operation of the non-depository trust company over a 3-year period; appropriate liquidity, interest rate, and risk management standards commensurate with the size of a non-depository trust company; management practices with respect to required payment stablecoin assets; appropriate operational, compliance, and information technology risk management, including Bank Secrecy Act and sanctions compliance; and other rules required by this section. In determining capital requirements applicable to a non-depository trust company that has no material assets other than required payment stablecoin assets under this section— the non-depository trust company shall not be subject to requirements similar to section 171 of the Financial Stability Act of 2010 ( 12 U.S.C. 5371 ); and State bank supervisors and the Board shall take into account the limited risks of the assets of the non-depository trust company. Nothing in this section may be construed as— preventing a State bank supervisor from imposing additional or more strict regulatory standards on a non-depository trust company for issuing payment stablecoins; or affecting existing State laws governing interstate trust company business or permitting non-depository trust companies to conduct payment stablecoin activities on an interstate basis which are inconsistent with State laws governing interstate trust company business. Not later than 180 days after the date that the nominal value of all outstanding payment stablecoins issued by a non-depository trust company first exceeds $9,000,000,000, as adjusted under section 3(b), at the end of a business day, the non-depository trust company shall, in consultation with the applicable State bank supervisor, develop a plan for the conversion of the non-depository trust company into a depository institution under section 7, which may include capital planning, management planning, and third-party vendor management. A non-depository trust company shall only conduct payment stablecoin activities specified under this Act within the trust company.
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