Financial Services Regulatory Relief Act of 2006
FINANCIAL SERVICES REGULATORY RELIEF ACT OF 2006 -- (Senate - September 29, 2006)
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Mr. CRAPO. In adopting this provision, it is our intention that the regulatory agencies utilize Section 702 with care and precision. Specifically, we do not intend that the regulatory agencies use it routinely in connection with corporate applications, notices or requests to impose financial or other conditions on bank directors or officers that contain a personal guarantee against loss by the institution. In particular, it is not our intention that the regulatory agencies use it routinely to require directors or officers of insured depository institutions to enter into capital maintenance agreements with the agencies as a condition of granting a charter or providing deposit insurance. Nor is it our intention that the regulatory agencies use it routinely to require bank directors or officers to maintain the capital of a troubled insured depository institution without the director's or officer's agreement.
In utilizing their authority under Section 702 to enforce agreements to protect the deposit insurance fund, banking agencies should be mindful of the fact that our national banking policies should encourage the participation of highly qualified people on the boards of depository institutions. Creation of an environment where the threat of personal liability may cause bank directors to resign or keep well-qualified people from becoming directors in the first place would be counterproductive. We intend to monitor closely how this provision is applied by the regulatory agencies to ensure that such an environment does not result.
Mr. JOHNSON. I thank the Senator for his explanation. I understand that the regulatory agencies, specifically the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Office of Thrift Supervision, and the Federal Deposit Insurance Corporation agree with this interpretation as does the House of Representatives.
Mr. CRAPO. That is correct. I ask unanimous consent to have printed in the RECORD a copy of a joint letter from the regulatory agencies confirming this.
There being no objection, the material was ordered to be printed in the Record, as follows:
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