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12 USC CHAPTER 34 - FEDERAL FINANCIAL INSTITUTIONS

EXAMINATION COUNCIL 01/06/03

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TITLE 12 - BANKS AND BANKING

CHAPTER 34 - FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

.

-HEAD-

CHAPTER 34 - FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

-MISC1-

Sec.

3301. Declaration of purpose.

3302. Definitions.

3303. Financial Institutions Examination Council.

(a) Establishment; composition.

(b) Chairmanship.

(c) Term of office.

(d) Designation of officers and employees.

(e) Compensation and expenses.

3304. Costs and expenses of Council.

3305. Functions of Council.

(a) Establishment of principles and standards.

(b) Making recommendations regarding supervisory

matters and adequacy of supervisory tools.

(c) Development of uniform reporting system.

(d) Conducting schools for examiners and assistant

examiners.

(e) Affect on Federal regulatory agency research and

development of new financial institutions

supervisory agencies.

(f) Annual report.

(g) Flood insurance.

3306. State liaison.

3307. Administration.

(a) Authority of Chairman of Council.

(b) Use of personnel, services, and facilities of

Federal financial institutions regulatory

agencies, Federal Reserve banks, and Federal

Home Loan Banks.

(c) Compensation, authority, and duties of officers

and employees; experts and consultants.

3308. Access to books, accounts, records, etc., by Council.

3309. Risk management training.

(a) Seminars.

(b) Study of risk management training program.

3310. Establishment of Appraisal Subcommittee.

3311. Required review of regulations.

(a) In general.

(b) Process.

(c) Complete review.

(d) Regulatory response.

(e) Report to Congress.

-SECREF-

CHAPTER REFERRED TO IN OTHER SECTIONS

This chapter is referred to in title 42 section 4012a.

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12 USC Sec. 3301 01/06/03

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TITLE 12 - BANKS AND BANKING

CHAPTER 34 - FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

-HEAD-

Sec. 3301. Declaration of purpose

-STATUTE-

It is the purpose of this chapter to establish a Financial

Institutions Examination Council which shall prescribe uniform

principles and standards for the Federal examination of financial

institutions by the Office of the Comptroller of the Currency, the

Federal Deposit Insurance Corporation, the Board of Governors of

the Federal Reserve System, the Federal Home Loan Bank Board, and

the National Credit Union Administration and make recommendations

to promote uniformity in the supervision of these financial

institutions. The Council's actions shall be designed to promote

consistency in such examination and to insure progressive and

vigilant supervision.

-SOURCE-

(Pub. L. 95-630, title X, Sec. 1002, Nov. 10, 1978, 92 Stat. 3694.)

-MISC1-

EFFECTIVE DATE

Chapter effective upon the expiration of 120 days after Nov. 10,

1978, see section 2101 of Pub. L. 95-630, set out as a note under

section 375b of this title.

SHORT TITLE

Section 1001 of title X of Pub. L. 95-630 provided that: ''This

title (enacting this chapter and amending section 67 of former

Title 31, Money and Finance) may be cited as the 'Federal Financial

Institutions Examination Council Act of 1978'.''

-TRANS-

TRANSFER OF FUNCTIONS

Federal Home Loan Bank Board abolished and functions transferred,

see sections 401 to 406 of Pub. L. 101-73, set out as a note under

section 1437 of this title.

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12 USC Sec. 3302 01/06/03

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TITLE 12 - BANKS AND BANKING

CHAPTER 34 - FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

-HEAD-

Sec. 3302. Definitions

-STATUTE-

As used in this chapter -

(1) the term ''Federal financial institutions regulatory

agencies'' means the Office of the Comptroller of the Currency,

the Board of Governors of the Federal Reserve System, the Federal

Deposit Insurance Corporation, the Office of Thrift Supervision,

and the National Credit Union Administration;

(2) the term ''Council'' means the Financial Institutions

Examination Council; and

(3) the term ''financial institution'' means a commercial bank,

a savings bank, a trust company, a savings association, a

building and loan association, a homestead association, a

cooperative bank, or a credit union; (FOOTNOTE 1)

(FOOTNOTE 1) So in original. The semicolon probably should be a

period.

-SOURCE-

(Pub. L. 95-630, title X, Sec. 1003, Nov. 10, 1978, 92 Stat. 3694;

Pub. L. 101-73, title VII, Sec. 744(a)(1), Aug. 9, 1989, 103 Stat.

438.)

-MISC1-

AMENDMENTS

1989 - Par. (1). Pub. L. 101-73, Sec. 744(a)(1)(A), substituted

''Office of Thrift Supervision'' for ''Federal Home Loan Bank

Board''.

Par. (3). Pub. L. 101-73, Sec. 744(a)(1)(B), substituted

''savings association'' for ''savings and loan association''.

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12 USC Sec. 3303 01/06/03

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TITLE 12 - BANKS AND BANKING

CHAPTER 34 - FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

-HEAD-

Sec. 3303. Financial Institutions Examination Council

-STATUTE-

(a) Establishment; composition

There is established the Financial Institutions Examination

Council which shall consist of -

(1) the Comptroller of the Currency,

(2) the Chairman of the Board of Directors of the Federal

Deposit Insurance Corporation,

(3) a Governor of the Board of Governors of the Federal Reserve

System designated by the Chairman of the Board,

(4) the Director, Office of Thrift Supervision (FOOTNOTE 1)

(FOOTNOTE 1) So in original. Probably should be followed by '',

and''.

(5) the Chairman of the National Credit Union Administration

Board.

(b) Chairmanship

The members of the Council shall select the first chairman of the

Council. Thereafter the chairmanship shall rotate among the members

of the Council.

(c) Term of office

The term of the Chairman of the Council shall be two years.

(d) Designation of officers and employees

The members of the Council may, from time to time, designate

other officers or employees of their respective agencies to carry

out their duties on the Council.

(e) Compensation and expenses

Each member of the Council shall serve without additional

compensation but shall be entitled to reasonable expenses incurred

in carrying out his official duties as such a member.

-SOURCE-

(Pub. L. 95-630, title X, Sec. 1004, Nov. 10, 1978, 92 Stat. 3694;

Pub. L. 101-73, title VII, Sec. 744(a)(2), Aug. 9, 1989, 103 Stat.

438.)

-MISC1-

AMENDMENTS

1989 - Subsec. (a)(4). Pub. L. 101-73 substituted ''Director,

Office of Thrift Supervision'' for ''Chairman of the Federal Home

Loan Bank Board, and''.

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12 USC Sec. 3304 01/06/03

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TITLE 12 - BANKS AND BANKING

CHAPTER 34 - FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

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Sec. 3304. Costs and expenses of Council

-STATUTE-

One-fifth of the costs and expenses of the Council, including the

salaries of its employees, shall be paid by each of the Federal

financial institutions regulatory agencies. Annual assessments for

such share shall be levied by the Council based upon its projected

budget for the year, and additional assessments may be made during

the year if necessary.

-SOURCE-

(Pub. L. 95-630, title X, Sec. 1005, Nov. 10, 1978, 92 Stat. 3695.)

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12 USC Sec. 3305 01/06/03

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TITLE 12 - BANKS AND BANKING

CHAPTER 34 - FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

-HEAD-

Sec. 3305. Functions of Council

-STATUTE-

(a) Establishment of principles and standards

The Council shall establish uniform principles and standards and

report forms for the examination of financial institutions which

shall be applied by the Federal financial institutions regulatory

agencies.

(b) Making recommendations regarding supervisory matters and

adequacy of supervisory tools

(1) The Council shall make recommendations for uniformity in

other supervisory matters, such as, but not limited to, classifying

loans subject to country risk, identifying financial institutions

in need of special supervisory attention, and evaluating the

soundness of large loans that are shared by two or more financial

institutions. In addition, the Council shall make recommendations

regarding the adequacy of supervisory tools for determining the

impact of holding company operations on the financial institutions

within the holding company and shall consider the ability of

supervisory agencies to discover possible fraud or questionable and

illegal payments and practices which might occur in the operation

of financial institutions or their holding companies.

(2) When a recommendation of the Council is found unacceptable by

one or more of the applicable Federal financial institutions

regulatory agencies, the agency or agencies shall submit to the

Council, within a time period specified by the Council, a written

statement of the reasons the recommendation is unacceptable.

(c) Development of uniform reporting system

The Council shall develop uniform reporting systems for federally

supervised financial institutions, their holding companies, and

nonfinancial institution subsidiaries of such institutions or

holding companies. The authority to develop uniform reporting

systems shall not restrict or amend the requirements of section

78l(i) of title 15.

(d) Conducting schools for examiners and assistant examiners

The Council shall conduct schools for examiners and assistant

examiners employed by the Federal financial institutions regulatory

agencies. Such schools shall be open to enrollment by employees of

State financial institutions supervisory agencies and employees of

the Federal Housing Finance Board under conditions specified by the

Council.

(e) Affect on Federal regulatory agency research and development of

new financial institutions supervisory agencies

Nothing in this chapter shall be construed to limit or discourage

Federal regulatory agency research and development of new financial

institutions supervisory methods and tools, nor to preclude the

field testing of any innovation devised by any Federal regulatory

agency.

(f) Annual report

Not later than April 1 of each year, the Council shall prepare an

annual report covering its activities during the preceding year.

(g) Flood insurance

The Council shall consult with and assist the Federal entities

for lending regulation, as such term is defined in section 4121(a)

of title 42, in developing and coordinating uniform standards and

requirements for use by regulated lending institutions under the

national flood insurance program.

-SOURCE-

(Pub. L. 95-630, title X, Sec. 1006, Nov. 10, 1978, 92 Stat. 3695;

Pub. L. 97-320, title IV, Sec. 431, Oct. 15, 1982, 96 Stat. 1527;

Pub. L. 101-73, title VII, Sec. 744(a)(3), Aug. 9, 1989, 103 Stat.

438; Pub. L. 103-325, title V, Sec. 530, Sept. 23, 1994, 108 Stat.

2267.)

-MISC1-

AMENDMENTS

1994 - Subsec. (g). Pub. L. 103-325 added subsec. (g).

1989 - Subsec. (d). Pub. L. 101-73 inserted ''and employees of

the Federal Housing Finance Board'' after ''supervisory agencies''.

1982 - Subsec. (b)(2). Pub. L. 97-320 substituted

''unacceptable'' for ''unaccepted''.

REPORT ON CONSISTENT USE OF FINANCIAL TERMINOLOGY

Section 210 of Pub. L. 103-325 provided that: ''Not later than 2

years after the date of enactment of this Act (Sept. 23, 1994), the

Financial Institutions Examination Council shall report to the

Congress on its recommendations for the use of consistent financial

terminology by depository institutions for small business loans or

leases of personal property which are sold for the creation of

small business related securities (as defined in section

3(a)(53)(A) of the Securities Exchange Act of 1934 (15 U.S.C.

78c(a)(53)(A))).''

EXAMINATION IMPROVEMENT PROGRAM

Pub. L. 102-242, title I, Sec. 111(d), Dec. 19, 1991, 105 Stat.

2241, provided that:

''(1) In general. - The appropriate Federal banking agencies,

acting through the Federal Financial Institutions Examination

Council, shall each establish a comparable examination improvement

program that meets the requirements of paragraph (2).

''(2) Requirements. - An examination improvement program meets

the requirements of this paragraph if, under the program, the

agency is required -

''(A) to periodically review the organization and training of

the staff of the agency who are responsible for conducting

examinations of insured depository institutions and to make such

improvements as the agency determines to be appropriate to ensure

frequent, objective, and thorough examinations of such

institutions; and

''(B) to increase the number of examiners, supervisors, and

other individuals employed by the agency in connection with

conducting or supervising examinations of insured depository

institutions to the extent necessary to ensure frequent,

objective, and thorough examinations of such institutions.''

STUDY ON REGULATORY BURDEN

Pub. L. 102-242, title II, Sec. 221, Dec. 19, 1991, 105 Stat.

2305, provided that:

''(a) In General. - Not later than 1 year after the date of

enactment of this Act (Dec. 19, 1991), the Federal Financial

Institutions Examination Council, in consultation with individuals

representing insured depository institutions, consumers, community

groups, and other interested parties, shall -

''(1) review the policies and procedures, and recordkeeping and

documentation requirements used to monitor and enforce compliance

with -

''(A) all laws under the jurisdiction of the Federal banking

agencies; and

''(B) all laws affecting insured depository institutions

under the jurisdiction of the Secretary of the Treasury;

''(2) determine whether such policies, procedures, and

requirements impose unnecessary burdens on insured depository

institutions; and

''(3) identify any revisions of such policies, procedures, and

requirements that could reduce unnecessary burdens on insured

depository institutions without in any respect -

''(A) diminishing either compliance with or enforcement of

consumer laws in any respect; or

''(B) endangering the safety and soundness of insured

depository institutions.

''(b) Report. - Not later than 1 year after the date of enactment

of this Act (Dec. 19, 1991), the Federal Financial Institutions

Examination Council shall submit to the Congress a report

describing the revisions identified under subsection (a)(3).

''(c) Definitions. - For purposes of this section, the terms

'insured depository institution' and 'Federal banking agency' have

the same meanings as in section 3 of the Federal Deposit Insurance

Act (12 U.S.C. 1813).''

STUDY AND REPORT ASSESSING FEASIBILITY AND USEFULNESS OF DEPOSITORY

INSTITUTIONS MAKING SMALL BUSINESS LOANS TO COMPILE AND DISCLOSE

LOAN INFORMATION

Pub. L. 96-399, title III, Sec. 340(d), Oct. 8, 1980, 94 Stat.

1659, directed Federal Financial Institutions Examination Council,

in consultation with Administrator of Small Business

Administration, to conduct a study to assess feasibility and

usefulness of requiring depository institutions which make small

business loans to compile and publicly disclose information

regarding such loans, and directed Council to submit a report on

results of such study, together with recommendations, to Senate

Committee on Banking, Housing, and Urban Affairs and House

Committee on Banking, Finance and Urban Affairs not later than Mar.

1, 1981.

EVALUATION AND REPORT ON FEASIBILITY AND DESIRABILITY OF

ESTABLISHING A UNIFIED SYSTEM FOR ENFORCING FAIR LENDING LAWS AND

REGULATIONS

Pub. L. 96-399, title III, Sec. 340(e), Oct. 8, 1980, 94 Stat.

1659, directed Federal Financial Institutions Examination Council

to transmit a report to Congress not later than Sept. 30, 1982, on

feasibility and desirability of establishing a unified system for

enforcing fair lending laws and regulations, implementing Community

Reinvestment Act of 1977 (12 U.S.C. 2901 et seq.), and satisfying

public disclosure purposes of Home Mortgage Disclosure Act of 1975

(12 U.S.C. 2801 et seq.), such report to evaluate status and

effectiveness of data collection and analysis systems of such

agencies involving fair lending and community reinvestment, and to

outline possible specific timetables for implementing such a

unified system.

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12 USC Sec. 3306 01/06/03

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TITLE 12 - BANKS AND BANKING

CHAPTER 34 - FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

-HEAD-

Sec. 3306. State liaison

-STATUTE-

To encourage the application of uniform examination principles

and standards by State and Federal supervisory agencies, the

Council shall establish a liaison committee composed of five

representatives of State agencies which supervise financial

institutions which shall meet at least twice a year with the

Council. Members of the liaison committee shall receive a

reasonable allowance for necessary expenses incurred in attending

meetings.

-SOURCE-

(Pub. L. 95-630, title X, Sec. 1007, Nov. 10, 1978, 92 Stat. 3696.)

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12 USC Sec. 3307 01/06/03

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TITLE 12 - BANKS AND BANKING

CHAPTER 34 - FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

-HEAD-

Sec. 3307. Administration

-STATUTE-

(a) Authority of Chairman of Council

The Chairman of the Council is authorized to carry out and to

delegate the authority to carry out the internal administration of

the Council, including the appointment and supervision of employees

and the distribution of business among members, employees, and

administrative units.

(b) Use of personnel, services, and facilities of Federal financial

institutions regulatory agencies, Federal Reserve banks, and

Federal Home Loan Banks

in (FOOTNOTE 1) addition to any other authority conferred upon it

by this chapter, in carrying out its functions under this chapter,

the Council may utilize, with their consent and to the extent

practical, the personnel, services, and facilities of the Federal

financial institutions regulatory agencies, Federal Reserve banks,

and Federal Home Loan Banks, with or without reimbursement

therefor.

(FOOTNOTE 1) So in original. Probably should be capitalized.

(c) Compensation, authority, and duties of officers and employees;

experts and consultants

In addition, the Council may -

(1) subject to the provisions of title 5 relating to the

competitive service, classification, and General Schedule pay

rates, appoint and fix the compensation of such officers and

employees as are necessary to carry out the provisions of this

chapter, and to prescribe the authority and duties of such

officers and employees; and

(2) obtain the services of such experts and consultants as are

necessary to carry out the provisions of this chapter.

-SOURCE-

(Pub. L. 95-630, title X, Sec. 1008, Nov. 10, 1978, 92 Stat. 3696.)

-REFTEXT-

REFERENCES IN TEXT

The provisions of title 5 relating to the competitive service,

referred to in subsec. (c), are classified generally to section

3301 et seq. of Title 5, Government Organization and Employees.

The provisions of title 5 relating to classification, referred to

in subsec. (c), are classified generally to chapter 51 (Sec. 5101

et seq.) and to subchapter III (Sec. 5331 et seq.) of chapter 53 of

Title 5.

The provisions of title 5 relating to General Schedule pay rates,

referred to in subsec. (c), are set out under section 5332 of Title

5.

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12 USC Sec. 3308 01/06/03

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TITLE 12 - BANKS AND BANKING

CHAPTER 34 - FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

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Sec. 3308. Access to books, accounts, records, etc., by Council

-STATUTE-

For the purpose of carrying out this chapter, the Council shall

have access to all books, accounts, records, reports, files,

memorandums, papers, things, and property belonging to or in use by

Federal financial institutions regulatory agencies, including

reports of examination of financial institutions or their holding

companies from whatever source, together with workpapers and

correspondence files related to such reports, whether or not a part

of the report, and all without any deletions.

-SOURCE-

(Pub. L. 95-630, title X, Sec. 1009, Nov. 10, 1978, 92 Stat. 3696.)

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12 USC Sec. 3309 01/06/03

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TITLE 12 - BANKS AND BANKING

CHAPTER 34 - FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

-HEAD-

Sec. 3309. Risk management training

-STATUTE-

(a) Seminars

The Council shall develop and administer training seminars in

risk management for its employees and the employees of insured

financial institutions.

(b) Study of risk management training program

Not later than end of the 1-year period beginning on August 9,

1989, the Council shall -

(1) conduct a study on the feasibility and appropriateness of

establishing a formalized risk management training program

designed to lead to the certification of Risk Management

Analysts; and

(2) report to the Congress the results of such study.

-SOURCE-

(Pub. L. 95-630, title X, Sec. 1009A, as added Pub. L. 101-73,

title XII, Sec. 1218, Aug. 9, 1989, 103 Stat. 546.)

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12 USC Sec. 3310 01/06/03

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TITLE 12 - BANKS AND BANKING

CHAPTER 34 - FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

-HEAD-

Sec. 3310. Establishment of Appraisal Subcommittee

-STATUTE-

There shall be within the Council a subcommittee to be known as

the ''Appraisal Subcommittee'', which shall consist of the

designees of the heads of the Federal financial institutions

regulatory agencies. Each such designee shall be a person who has

demonstrated knowledge and competence concerning the appraisal

profession.

-SOURCE-

(Pub. L. 95-630, title X, Sec. 1011, as added Pub. L. 101-73, title

XI, Sec. 1102, Aug. 9, 1989, 103 Stat. 511.)

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12 USC Sec. 3311 01/06/03

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TITLE 12 - BANKS AND BANKING

CHAPTER 34 - FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

-HEAD-

Sec. 3311. Required review of regulations

-STATUTE-

(a) In general

Not less frequently than once every 10 years, the Council and

each appropriate Federal banking agency represented on the Council

shall conduct a review of all regulations prescribed by the Council

or by any such appropriate Federal banking agency, respectively, in

order to identify outdated or otherwise unnecessary regulatory

requirements imposed on insured depository institutions.

(b) Process

In conducting the review under subsection (a) of this section,

the Council or the appropriate Federal banking agency shall -

(1) categorize the regulations described in subsection (a) of

this section by type (such as consumer regulations, safety and

soundness regulations, or such other designations as determined

by the Council, or the appropriate Federal banking agency); and

(2) at regular intervals, provide notice and solicit public

comment on a particular category or categories of regulations,

requesting commentators to identify areas of the regulations that

are outdated, unnecessary, or unduly burdensome.

(c) Complete review

The Council or the appropriate Federal banking agency shall

ensure that the notice and comment period described in subsection

(b)(2) of this section is conducted with respect to all regulations

described in subsection (a) of this section not less frequently

than once every 10 years.

(d) Regulatory response

The Council or the appropriate Federal banking agency shall -

(1) publish in the Federal Register a summary of the comments

received under this section, identifying significant issues

raised and providing comment on such issues; and

(2) eliminate unnecessary regulations to the extent that such

action is appropriate.

(e) Report to Congress

Not later than 30 days after carrying out subsection (d)(1) of

this section, the Council shall submit to the Congress a report,

which shall include -

(1) a summary of any significant issues raised by public

comments received by the Council and the appropriate Federal

banking agencies under this section and the relative merits of

such issues; and

(2) an analysis of whether the appropriate Federal banking

agency involved is able to address the regulatory burdens

associated with such issues by regulation, or whether such

burdens must be addressed by legislative action.

-SOURCE-

(Pub. L. 104-208, div. A, title II, Sec. 2222, Sept. 30, 1996, 110

Stat. 3009-414.)

-COD-

CODIFICATION

Section enacted as part of the Economic Growth and Regulatory

Paperwork Reduction Act of 1996, and also as part of the Omnibus

Consolidated Appropriations Act, 1997, and not as part of the

Federal Financial Institutions Examination Council Act of 1978

which comprises this chapter.

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