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S. 1297: Independent and Community Bank Shareholders Protection Act


The text of the bill below is as of May 2, 2019 (Introduced).


II

116th CONGRESS

1st Session

S. 1297

IN THE SENATE OF THE UNITED STATES

May 2, 2019

(for himself and Mr. Roberts) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs

A BILL

To amend the Federal Deposit Insurance Act to provide shareholders of certain depository institutions a cause of action for assets seized by an appropriate Federal banking agency.

1.

Short title

This Act may be cited as the Independent and Community Bank Shareholders Protection Act.

2.

Shareholder claims

(a)

In general

Section 11(d) of the Federal Deposit Insurance Act (12 U.S.C. 1821(d)) is amended by adding at the end the following:

(21)

Shareholder claims for just compensation

(A)

Definition

In this paragraph, the term covered institution means a depository institution—

(i)

for which the Corporation has appointed a conservator or receiver; and

(ii)

that has total assets of less than $15,000,000 as of the date on which the institution enters conservatorship or receivership.

(B)

Claims authorized

(i)

In general

A shareholder of a covered institution may file a claim with the Corporation for just compensation to be paid by the Corporation to the shareholder.

(ii)

Holding companies

A shareholder of a depository institution holding company may file a claim authorized by this subparagraph on behalf of such company with respect to a covered institution.

(C)

Amount to be paid

Just compensation shall be paid to a shareholder for a claim under this paragraph in an amount equal to the pro-rata share of the shareholder of the net worth of the covered institution according to generally accepted accounting principles determined as of the date on which the covered institution enters conservatorship or receivership, whichever occurs first.

(D)

Limitation on payment of claims

The Corporation shall not pay a claim under subparagraph (B) if—

(i)

the covered institution is determined by the final judgment of a court of competent jurisdiction to have been insolvent as of the date on which the Corporation was appointed conservator or receiver; or

(ii)

the administrative expenses of the Corporation arising from the appointment of a conservator or receiver for the covered institution exceed available funds from the covered institution, any deposit liability of the institution, any other general or senior liability of the institution and any obligation subordinated to depositors or general credits exceed the available funds from the covered institution.

(E)

Statute of limitations

(i)

In general

Except as provided in clause (ii), the applicable statute of limitations with regard to a claim brought by a shareholder under subparagraph (B) shall be 90 days beginning on the date that a conservator or receiver is appointed for the covered institution pursuant to this Act.

(ii)

Claims arising from prior actions

The applicable statute of limitations with regard to a claim brought by a shareholder under subparagraph (B) for a covered institution for which a conservator or receiver was appointed before the date of enactment of this paragraph shall be 90 days beginning on the date of enactment of this paragraph.

(F)

Savings association shareholders

The rights provided to a shareholder under subparagraph (B), shall apply in the same manner and to the same extent to—

(i)

a shareholder of a savings association for which the Office of Thrift Supervision or the Office of the Comptroller of the Currency appointed a conservator or receiver; and

(ii)

a shareholder of a savings and loan holding company on behalf of such holding company with respect to a savings association for which the Office of Thrift Supervision or the Office of the Comptroller of the Currency appointed a conservator or receiver.

(G)

Special rules

(i)

Prior claims

A shareholder shall not be precluded from filing a claim under this paragraph if a claim with respect to the same conservatorship or receivership has been previously adjudicated before a court of competent jurisdiction.

(ii)

United States Court of Federal Claims

A shareholder may seek review of a denial by the Corporation of a claim filed under this paragraph in the United States Court of Federal Claims.

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