(a) Board of Directors; use of mails; cooperation with other Federal agencies

Federal agencies

The Board of Directors shall administer the affairs of the Corporation fairly and impartially and without discrimination. The Board of Directors of the Corporation shall determine and prescribe the manner in which its obligations shall be incurred and its expenses allowed and paid. The Corporation shall be entitled to the free use of the United States mails in the same manner as the executive departments of the Government. The Corporation with the consent of any Federal Reserve bank or of any board, commission, independent establishment, or executive department of the Government, including any field service thereof, may avail itself of the use of information, services, and facilities thereof in carrying out the provisions of this chapter.

(b) Examinations

(1) Appointment of examiners and claims agents

The Board of Directors shall appoint examiners and claims agents.

(2) Regular examinations

Any examiner appointed under paragraph (1) shall have power, on behalf of the Corporation, to examine -

(A)

any insured State nonmember bank (except a District bank) or insured State branch of any foreign bank;

(B)

any depository institution which files an application with the Corporation to become an insured depository institution; and

(C)

any insured depository institution in default,

whenever the Board of Directors determines an examination of any such depository institution is necessary.

(3) Special examination of any insured depository institution

In addition to the examinations authorized under paragraph (2), any examiner appointed under paragraph (1) shall have power, on behalf of the Corporation, to make any special examination of any insured depository institution whenever the Board of Directors determines a special examination of any such depository institution is necessary to determine the condition of such depository institution for insurance purposes.

(4) Examination of affiliates

(A) In general

In making any examination under paragraph (2) or (3), any examiner appointed under paragraph (1) shall have power, on behalf of the Corporation, to make such examinations of the affairs of any affiliate of any depository institution as may be necessary to disclose fully -

(i)

the relationship between such depository institution and any such affiliate; and

(ii)

the effect of such relationship on the depository institution.

(B) Commitment by foreign banks to allow examinations of affiliates

No branch or depository institution subsidiary of a foreign bank may become an insured depository institution unless such foreign bank submits a written binding commitment to the Board of Directors to permit any examination of any affiliate of such branch or depository institution subsidiary pursuant to subparagraph (A) to the extent determined by the Board of Directors to be necessary to carry out the purposes of this chapter.

(5) Examination of insured State branches

The Board of Directors shall -

(A)

coordinate examinations of insured State branches of foreign banks with examinations conducted by the Board of Governors of the Federal Reserve System under section 3105(c)(1) of this title; and

(B)

to the extent possible, participate in any simultaneous examination of the United States operations of a foreign bank requested by the Board under such section.

(6) Power and duty of examiners

Each examiner appointed under paragraph (1) shall -

(A)

have power to make a thorough examination of any insured depository institution or affiliate under paragraph (2), (3), (4), or (5); and

(B)

shall make a full and detailed report of condition of any insured depository institution or affiliate examined to the Corporation.

(7) Power of claim agents

Each claim agent appointed under paragraph (1) shall have power to investigate and examine all claims for insured deposits.

(c) Administration of oaths and affirmations; evidence; subpena powers

In connection with examinations of insured depository institutions and any State nonmember bank, savings association, or other institution making application to become insured depository institutions, and affiliates thereof, or with other types of investigations to determine compliance with applicable law and regulations, the appropriate Federal banking agency, or its designated representatives, are authorized to administer oaths and affirmations, and to examine and to take and preserve testimony under oath as to any matter in respect to the affairs or ownership of any such bank or institution or affiliate thereof, and to exercise such other powers as are set forth in section 1818(n) of this title.

(d) Annual on-site examinations of all insured depository institutions required

(1) In general

The appropriate Federal banking agency shall, not less than once during each 12-month period, conduct a full-scope, on-site examination of each insured depository institution.

(2) Examinations by Corporation

Paragraph (1) shall not apply during any 12-month period in which the Corporation has conducted a full-scope, on-site examination of the insured depository institution.

(3) State examinations acceptable

The examinations required by paragraph (1) may be conducted in alternate 12-month periods, as appropriate, if the appropriate Federal banking agency determines that an examination of the insured depository institution conducted by the State during the intervening 12-month period carries out the purpose of this subsection.

(4) 18-month rule for certain small institutions

Paragraphs (1), (2), and (3) shall apply with ''18-month'' substituted for ''12-month'' if -

(A)

the insured depository institution has total assets of less than $250,000,000;

(B)

the institution is well capitalized, as defined in section 1831o of this title;

(C)

when the institution was most recently examined, it was found to be well managed, and its composite condition -

(i)

was found to be outstanding; or

(ii)

was found to be outstanding or good, in the case of an insured depository institution that has total assets of not more than $100,000,000;

(D)

the insured institution is not currently subject to a formal enforcement proceeding or order by the Corporation or the appropriate Federal banking agency; and

(E)

no person acquired control of the institution during the 12-month period in which a full-scope, on-site examination would be required but for this paragraph.

(5) Certain Government-controlled institutions exempted

Paragraph (1) does not apply to -

(A)

any institution for which the Corporation or the Resolution Trust Corporation is conservator; or

(B)

any bridge bank, none of the voting securities of which are owned by a person or agency other than the Corporation or the Resolution Trust Corporation.

(6) Coordinated examinations

To minimize the disruptive effects of examinations on the operations of insured depository institutions -

(A)

each appropriate Federal banking agency shall, to the extent practicable and consistent with principles of safety and soundness and the public interest -

(i)

coordinate examinations to be conducted by that agency at an insured depository institution and its affiliates;

(ii)

coordinate with the other appropriate Federal banking agencies in the conduct of such examinations;

(iii)

work to coordinate with the appropriate State bank supervisor -

(I)

the conduct of all examinations made pursuant to this subsection; and

(II)

the number, types, and frequency of reports required to be submitted to such agencies and supervisors by insured depository institutions, and the type and amount of information required to be included in such reports; and

(iv)

use copies of reports of examinations of insured depository institutions made by any other Federal banking agency or appropriate State bank supervisor to eliminate duplicative requests for information; and

(B)

not later than 2 years after September 23, 1994, the Federal banking agencies shall jointly establish and implement a system for determining which one of the Federal banking agencies or State bank supervisors shall be the lead agency responsible for managing a unified examination of each insured depository institution and its affiliates, as required by this subsection.

(7) Separate examinations permitted

Notwithstanding paragraph (6), each appropriate Federal banking agency may conduct a separate examination in an emergency or under other exigent circumstances, or when the agency believes that a violation of law may have occurred.

(8) Report

At the time the system provided for in paragraph (6) is established, the Federal banking agencies shall submit a joint report describing the system to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Banking, Finance and Urban Affairs of the House of Representatives. Thereafter, the Federal banking agencies shall annually submit a joint report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Banking, Finance and Urban Affairs of the House of Representatives regarding the progress of the agencies in implementing the system and indicating areas in which enhancements to the system, including legislature improvements, would be appropriate.

(9) Standards for determining adequacy of State examinations

The Federal Financial Institutions Examination Council shall issue guidelines establishing standards to be used at the discretion of the appropriate Federal banking agency for purposes of making a determination under paragraph (3).

(10) Agencies authorized to increase maximum asset amount of institutions for certain purposes

At any time after the end of the 2-year period beginning on September 23, 1994, the appropriate Federal banking agency, in the agency's discretion, may increase the maximum amount limitation contained in paragraph (4)(C)(ii), by regulation, from $100,000,000 to an amount not to exceed $250,000,000 for purposes of such paragraph, if the agency determines that the greater amount would be consistent with the principles of safety and soundness for insured depository institutions.

(e) Examination fees

(1) Regular and special examinations of depository institutions

The cost of conducting any regular examination or special examination of any depository institution under subsection (b)(2), (b)(3), or (d) of this section may be assessed by the Corporation against the institution to meet the Corporation's expenses in carrying out such examinations.

(2) Examination of affiliates

The cost of conducting any examination of any affiliate of any insured depository institution under subsection (b)(4) of this section may be assessed by the Corporation against each affiliate which is examined to meet the Corporation's expenses in carrying out such examination.

(3) Assessment against depository institution in case of affiliate's refusal to pay

(A) In general

Subject to subparagraph (B), if any affiliate of any insured depository institution -

(i)

refuses to pay any assessment under paragraph (2); or

(ii)

fails to pay any such assessment before the end of the 60-day period beginning on the date the affiliate receives notice of the assessment,

the Corporation may assess such cost against, and collect such cost from, the depository institution.

(B) Affiliate of more than 1 depository institution

If any affiliate referred to in subparagraph (A) is an affiliate of more than 1 insured depository institution, the assessment under subparagraph (A) may be assessed against the depository institutions in such proportions as the Corporation determines to be appropriate.

(4) Civil money penalty for affiliate's refusal to cooperate

(A) Penalty imposed

If any affiliate of any insured depository institution -

(i)

refuses to permit an examiner appointed by the Board of Directors under subsection (b)(1) of this section to conduct an examination; or

(ii)

refuses to provide any information required to be disclosed in the course of any examination,

the depository institution shall forfeit and pay a penalty of not more than $5,000 for each day that any such refusal continues.

(B) Assessment and collection

Any penalty imposed under subparagraph (A) shall be assessed and collected by the Corporation in the manner provided in section 1818(i)(2) of this title.

(5) Deposits of examination assessment

Amounts received by the Corporation under this subsection (other than paragraph (4)) may be deposited in the manner provided in section 1823 of this title.

(f) Preservation of records by photography; admissibility as evidence

The Corporation may cause any and all records, papers, or documents kept by it or in its possession or custody to be photographed or microphotographed or otherwise reproduced upon film, which photographic film shall comply with the minimum standards of quality approved for permanent photographic records by the National Institute of Standards and Technology. Such photographs, microphotographs, or photographic film or copies thereof shall be deemed to be an original record for all purposes, including introduction in evidence in all State and Federal courts or administrative agencies and shall be admissible to prove any act, transaction, occurrence, or event therein recorded. Such photographs, microphotographs, or reproduction shall be preserved in such manner as the Board of Directors of the Corporation shall prescribe and the original records, papers, or documents may be destroyed or otherwise disposed of as the Board shall direct.

(g) Authority to prescribe regulations and definitions

Except to the extent that authority under this chapter is conferred on any of the Federal banking agencies other than the Corporation, the Corporation may -

(1)

prescribe regulations to carry out this chapter; and

(2)

by regulation define terms as necessary to carry out this chapter.

(h) Coordination of examination authority

(1) In general

The appropriate State bank supervisor of a host State may examine a branch operated in such State by an out-of-State insured State bank that resulted from an interstate merger transaction approved under section 1831u of this title or a branch established in such State pursuant to section 36(g) of this title or section 1828(d)(4) of this title -

(A)

for the purpose of determining compliance with host State laws, including those that govern banking, community reinvestment, fair lending, consumer protection, and permissible activities; and

(B)

to ensure that the activities of the branch are not conducted in an unsafe or unsound manner.

(2) Enforcement

If the State bank supervisor of a host State determines that there is a violation of the law of the host State concerning the activities being conducted by a branch described in paragraph (1) or that the branch is being operated in an unsafe and unsound manner, the State bank supervisor of the host State or, to the extent authorized by the law of the host State, a State law enforcement officer may undertake such enforcement actions and proceedings as would be permitted under the law of the host State as if the branch were a bank chartered by that host State.

(3) Cooperative agreement

The State bank supervisors from 2 or more States may enter into cooperative agreements to facilitate State regulatory supervision of State banks, including cooperative agreements relating to the coordination of examinations and joint participation in examinations.

(4) Federal regulatory authority

No provision of this subsection shall be construed as limiting in any way the authority of an appropriate Federal banking agency to examine or to take any enforcement actions or proceedings against any bank or branch of a bank for which the agency is the appropriate Federal banking agency.

(i) Flood insurance compliance by insured depository institutions

(1) Examinations

The appropriate Federal banking agency shall, during each scheduled on-site examination required by this section, determine whether the insured depository institution is complying with the requirements of the national flood insurance program.

(2) Report

(A) Requirement

Not later than 1 year after September 23, 1994, and biennially thereafter for the next 4 years, each appropriate Federal banking agency shall submit a report to the Congress on compliance by insured depository institutions with the requirements of the national flood insurance program.

(B) Contents

Each report submitted under this paragraph shall include a description of the methods used to determine compliance, the number of institutions examined during the reporting year, a listing and total number of institutions found not to be in compliance, actions taken to correct incidents of noncompliance, and an analysis of compliance, including a discussion of any trends, patterns, and problems, and recommendations regarding reasonable actions to improve the efficiency of the examinations processes.

(j) Consultation among examiners

(1) In general

Each appropriate Federal banking agency shall take such action as may be necessary to ensure that examiners employed by the agency -

(A)

consult on examination activities with respect to any depository institution; and

(B)

achieve an agreement and resolve any inconsistencies in the recommendations to be given to such institution as a consequence of any examinations.

(2) Examiner-in-charge

Each appropriate Federal banking agency shall consider appointing an examiner-in-charge with respect to a depository institution to ensure consultation on examination activities among all of the examiners of that agency involved in examinations of the institution