Sec. 2. Expanded insurance coverage for business payment accounts
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Section 11(a) of the Federal Deposit Insurance Act ( 12 U.S.C. 1821(a) ) is amended— in paragraph (1)(B), by striking The net amount and inserting Except as provided in paragraph (6), the net amount ; and by adding at the end the following: Notwithstanding paragraph (1), the Corporation shall establish a program under which the Corporation shall fully insure the deposits that any depositor at an insured depository institution maintains in a covered transaction account in accordance with subparagraph (B). The Corporation may only provide insurance for deposits under subparagraph
(A)in an amount of net deposits up to $100,000,000 per depositor per depository institution. Any amount of deposits insured under this paragraph shall not be taken into account when computing the net amount due to such depositor under paragraph (1)(B). In this paragraph, the term covered transaction account means a deposit or account maintained at an insured depository institution— by a business, non-profit, municipality, or similar organization; used predominantly for transactions, including payroll payments, vendor payments, and any other regular payments made to support the work or mission of the account holder; and that is non-interest bearing or that pays interest materially below prevailing market rates, as determined by the Corporation. . The amendments made by this subsection shall apply with respect to a covered transaction account (as defined in paragraph (6)(D) of section 11(a) of the Federal Deposit Insurance Act, as added by this section) on the date of the issuance of a final rule described in subsection (d). Section 207(k) of the Federal Credit Union Act ( 12 U.S.C. 1787(k) ) is amended— in paragraph (1)(A), by inserting and except as provided in paragraph
(7)after paragraph
(2); and by adding at the end the following: Notwithstanding paragraph (1), the Board shall establish a program under which the Board shall fully insure the deposits or shares in members accounts of an insured credit union that are covered transaction accounts in accordance with subparagraph (B). The Board may only provide insurance under subparagraph
(A)in an amount of the net deposits or shares up to $100,000,000 per member per insured credit union. Any amount of deposits or shares insured under this paragraph shall not be taken into account when computing the net amount due under paragraph (1)(A). In this paragraph, the term covered transaction account means a deposit, share, or account maintained at an insured credit union— by a business, non-profit, municipality, or similar organization; used predominantly for transactions, including payroll payments, vendor payments, and any other regular payments made to support the work or mission of the account holder; and that is non-interest bearing or that pays interest materially below prevailing market rates, as determined by the Board. . The amendments made by this subsection shall apply with respect to a covered transaction account (as defined in section 207(k)(7)(D) of the Federal Credit Union Act, as added by this section) on the date of the issuance of a final rule described in subsection (d). Not later than 90 days after the date of the enactment of this Act, the Federal Deposit Insurance Corporation shall begin collecting and analyzing data from insured depository institutions to establish requirements for the program established under paragraph
(6)of section 11(a) of the Federal Deposit Insurance Act, as added by this Act, including to determine the eligibility of covered transaction accounts and the amount of deposits to be insured under such program, as appropriate. Not later than 90 days after the date of the enactment of this Act, the National Credit Union Administration Board shall begin collecting and analyzing data from insured credit unions to establish requirements for the program established under paragraph
(7)of section 207(k) of the Federal Credit Union Act, as added by this Act, including to determine the eligibility of covered transaction accounts and the amount of deposits or shares to be insured under such program, as appropriate. In establishing the eligibility of covered transaction accounts and the amount of deposits or shares to be insured as described in paragraph (1), the Federal Deposit Insurance Corporation and the National Credit Union Administration Board, respectively, shall consider the following: The eligibility of covered transaction accounts and the maximum insurance amount for such deposits or shares to promote safety and soundness of insured depository institutions and insured credit unions, as applicable. The eligibility of covered transaction accounts and the maximum insurance amount for such deposits or shares to promote stability of the financial system of the United States. The eligibility of covered transaction accounts and the maximum insurance amount for such deposits or shares to promote a competitive depository market structure that, as applicable, includes— minority depository institutions (as defined in section 308 of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989) and minority insured credit unions; rural depository institutions and rural insured credit unions; depository institutions and credit unions that are community development financial institutions (as defined in section 103(5) of the Riegle Community Development and Regulatory Improvement Act of 1994); and other large, small, and medium-sized insured depository institutions and insured credit unions. The eligibility of covered transaction accounts and the maximum insurance amount for such deposits or shares to ensure holders of covered transaction accounts would be able to meet payment obligations in a timely fashion, including payroll and vendor payment obligations. The expected effect of assessment or premium adjustments on insured depository institutions and insured credit unions, as applicable. Not later than 18 months after the date of the enactment of this Act, the Federal Deposit Insurance Corporation and the National Credit Union Administration Board shall— make publicly available a report with detailed analyses conducted under this subsection, including aggregated data; and make available to the Committee on Financial Services of the House of Representatives and Committee on Banking, Housing, and Urban Affairs of the Senate the data collected under this subsection. Not later than 18 months after the date of the enactment of this Act, the Federal Deposit Insurance Corporation and the National Credit Union Administration Board shall each issue a proposed rule to carry out the requirements of this section and the amendments made by this section. The Federal Deposit Insurance Corporation and the National Credit Union Administration Board shall consult with the Board of Governors of the Federal Reserve System and the Comptroller of the Currency before issuing a proposed rule required under subparagraph (A). The Chairperson of the Federal Deposit Insurance Corporation and the Chairman of the National Credit Union Administration Board shall testify before the Financial Services Committee of the House of Representatives and Committee on Banking, Housing, and Urban Affairs of the Senate, at a time determined by the Chairs of those Committees that is after the date on which the proposed rule described in subparagraph
(A)is issued. Not later than 30 months after the date of the enactment of this Act, the Federal Deposit Insurance Corporation and the National Credit Union Administration Board shall each issue a final rule to carry out the requirements of this section and the amendments made by this section. Each rule described under subparagraph
(A)shall contain the following, which shall be jointly determined by the Federal Deposit Insurance Corporation and the National Credit Union Administration Board: A definition of the term deposits and deposits or shares that applies to both programs. A maximum insurance amount for deposits or shares held in a covered transaction account that applies to both programs. If the Federal Deposit Insurance Corporation or the National Credit Union Administration Board do not issue a final rule required under paragraph
(2)before the deadline described in that paragraph— the Chair of each agency failing to issue a final rule shall— testify before the Committee on Financial Services of the House of Representatives and Committee on Banking, Housing, and Urban Affairs of the Senate regarding the reasons why the agency has not yet issued a final rule; and submit a report to such Committees that includes— an assessment of the benefits and challenges posed by expanding deposit or share insurance as required, as applicable, under the program established under paragraph
(6)of section 11(a) of the Federal Deposit Insurance Act (as added by this Act) and the program established under paragraph
(7)of section 207(k) of the Federal Credit Union Act (as added by this Act); and any recommendations for administrative or legislative modifications; and the Comptroller General of the United State shall conduct a review of the reports required under subsection (c), along with any other relevant data, and submit to Congress a report on— the benefits and challenges posed by— the program established under paragraph
(6)of section 11(a) of the Federal Deposit Insurance Act, as added by this Act; and the program established under paragraph
(7)of section 207(k) of the Federal Credit Union Act, as added by this Act; and any recommendations for legislative or regulatory actions. A Deposit Insurance Fund restoration plan (as defined under section 7(b)(3)(E) of the Federal Deposit Insurance Act ( 12 U.S.C. 1817(b)(3)(E) )) or a restoration plan for the National Credit Union Share Insurance Fund (as described in section 202(c)(2)(D) of the Federal Credit Union Act ( 12 U.S.C. 1782(c)(2)(D) )) in effect on the date of the enactment of this Act shall be extended for a period of 8 years beginning on the effective date of a final rule issued by the applicable agency pursuant to subsection (d).
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Sec. 2
Expanded insurance coverage for business payment accounts
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