,,ii #aacth ,,congress #ast ,session ,s4 #gbg ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,april #ae1 #bjac ,mr4 ,moran 7for himself and ,mr4 ,manchin7 introduced the following bill2 which was read twice and referred to the ,committee on ,banking1 ,housing1 and ,urban ,affairs ,a ,,bill ,to improve the examination of depository institutions1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,financial ,institutions ,examination ,fairness and ,reform ,act4 #b4 ,timeliness of examination reports ,the ,federal ,financial ,institutions ,examination ,council ,act of #aigh 7#ab ,u4,s4,c4 #ccja et seq47 is amended by adding at the end the following3 #ajab4 ,timeliness of examination reports 7a7 ,in general 7#a7 ,final examination report ,a ,federal financial institutions regulatory agency shall provide a final examination report to a financial institution not later than #fj days after the later of-- 7,a7 the exit interview for an examination of the institution2 or 7,b7 the provision of additional information by the institution relating to the examination4 7#b7 ,exit interview ,if a financial institution is not subject to a resident examiner program1 the exit interview shall occur not later than the end of the #i-month period beginning on the commencement of the examination1 except that such period may be extended by the ,federal financial institutions regulatory agency by providing written notice to the institution and the ,office of ,examination ,ombudsman describing with particularity the reasons that a longer period is needed to complete the examination4 7b7 ,examination materials ,upon the request of a financial institution1 the ,federal financial institutions regulatory agency shall include with the final report under this section an appendix listing all examination or other factual information relied upon by the agency in support of a material supervisory determination4 4 #c4 ,examination standards 7a7 ,in general ,the ,federal ,financial ,institutions ,examination ,council ,act of #aigh 7#ab ,u4,s4,c4 #ccja et seq471 as amended by this ,act1 is amended by adding at the end the following3 #ajac4 ,examination standards 7a7 ,in general ,in the examination of financial institutions-- 7#a7 a commercial loan shall not be placed in non-accrual status solely because the collateral for such loan has deteriorated in value2 7#b7 a modified or restructured commercial loan shall be removed from non-accrual status if the borrower demonstrates the ability to perform on such loan over a maximum period of #f months1 except that with respect to loans on a quarterly1 semiannual1 or longer repayment schedule such period shall be a maximum of #c consecutive repayment periods2 7#c7 a new appraisal on a performing commercial loan shall not be required unless an advance of new funds is involved2 and 7#d7 in classifying a commercial loan in which there has been deterioration in collateral value1 the amount to be classified shall be the portion of the deficiency relating to the decline in collateral value and repayment capacity of the borrower4 7b7 ,well capitalized institutions ,the ,federal financial institutions regulatory agencies may not require a financial institution that is well capitalized to raise additional capital in lieu of an action prohibited under subsection 7a74 7c7 ,consistent loan classifications ,the ,federal financial institutions regulatory agencies shall develop and apply identical definitions and reporting requirements for non-accrual loans4 4 7b7 ,definition of material supervisory determination ,section #cji7;f77#a77;,a7 of the ,riegle ,community ,development and ,regulatory ,improvement ,act of #aiid 7#ab ,u4,s4,c4 #dhjf7;f77#a77;,a77 is amended-- 7#a7 in clause 7ii71 by striking and at the end2 and 7#b7 by inserting after clause 7iii7 the following3 7iv7 any issue specifically listed in an exam report as a matter requiring attention by the institution's management or board of directors2 and 4 #d4 ,examination ,ombudsman 7a7 ,in general ,the ,federal ,financial ,institutions ,examination ,council ,act of #aigh 7#ab ,u4,s4,c4 #ccja et seq471 as amended by this ,act1 is amended by adding at the end the following3 #ajad4 ,office of ,examination ,ombudsman 7a7 ,establishment ,there is established in the ,council an ,office of ,examination ,ombudsman4 7b7 ,head of office ,there is established the position of the ,ombudsman1 who shall serve as the head of the ,office of ,examination ,ombudsman1 and who shall be hired separately by the ,council and shall be independent from any member agency of the ,council4 7c7 ,staffing ,the ,ombudsman is authorized to hire staff to support the activities of the ,office of ,examination ,ombudsman4 7d7 ,duties ,the ,ombudsman shall-- 7#a7 receive and1 at the ,ombudsman's discretion1 investigate complaints from financial institutions1 their representatives1 or another entity acting on behalf of such institutions1 concerning examinations1 examination practices1 or examination reports2 7#b7 hold meetings1 at least once every three months and in locations designed to encourage participation from all sections of the ,united ,states1 with financial institutions1 their representatives1 or another entity acting on behalf of such institutions1 to discuss examination procedures1 examination practices1 or examination policies2 7#c7 review examination procedures of the ,federal financial institutions regulatory agencies to ensure that the written examination policies of those agencies are being followed in practice and adhere to the standards for consistency established by the ,council2 7#d7 conduct a continuing and regular program of examination quality assurance for all examination types conducted by the ,federal financial institutions regulatory agencies2 7#e7 process any supervisory appeal initiated under section #ajae or section #cji7;e7 of the ,riegle ,community ,development and ,regulatory ,improvement ,act of #aiid2 and 7#f7 report annually to the ,committee on ,financial ,services of the ,house of ,representatives1 the ,committee on ,banking1 ,housing1 and ,urban ,affairs of the ,senate1 and the ,council1 on the reviews carried out pursuant to paragraphs 7#c7 and 7#d71 including compliance with the requirements set forth in section #ajab regarding timeliness of examination reports1 and the ,council's recommendations for improvements in examination procedures1 practices1 and policies4 7e7 ,confidentiality ,the ,ombudsman shall keep confidential all meetings1 discussions1 and information provided by financial institutions4 4 7b7 ,definition ,section #ajjc of the ,federal ,financial ,institutions ,examination ,council ,act of #aigh 7#ab ,u4,s4,c4 #ccjb7 is amended-- 7#a7 in paragraph 7#b71 by striking and at the end2 7#b7 in paragraph 7#c71 by adding and at the end2 and 7#c7 by adding at the end the following3 7#d7 the term ,ombudsman means the ,ombudsman established under section #ajad4 4 #e4 ,right to appeal before an independent administrative law judge ,the ,federal ,financial ,institutions ,examination ,council ,act of #aigh 7#ab ,u4,s4,c4 #ccja et seq471 as amended by this ,act1 is amended by adding at the end the following3 #ajae4 ,right to appeal before an independent administrative law judge 7a7 ,in general ,a financial institution shall have the right to appeal a material supervisory determination contained in a final report of examination4 7b7 ,notice 7#a7 ,timing ,a financial institution seeking an appeal under this section shall file a written notice with the ,ombudsman within #fj days after receiving the final report or examination that is the subject of such appeal4 7#b7 ,identification of determination ,the written notice shall identify the material supervisory determination that is the subject of the appeal1 and a statement of the reasons why the institution believes that the determination is incorrect or should otherwise be modified4 7#c7 ,information to be provided to institution ,any information relied upon by the agency in the final report that is not in the possession of the financial institution may be requested by the financial institution and shall be delivered promptly by the agency to the financial institution4 7c7 ,hearing before independent administrative law judge 7#a7 ,in general ,the ,ombudsman shall determine the merits of the appeal on the record1 after an opportunity for a hearing before an independent administrative law judge4 7#b7 ,hearing procedures ,if a hearing is requested by the financial institution1 the hearing shall-- 7,a7 take place not later than #fj days after the notice of the appeal was received by the ,ombudsman2 and 7,b7 be conducted pursuant to the procedures set forth under sections #eef and #eeg of title #e1 ,united ,states ,code4 7#c7 ,judge recommendation2 standard of review ,in any hearing under this subsection-- 7,a7 the administrative law judge shall recommend to the ,ombudsman what determination should be made2 and 7,b7 in making such recommendation1 the administrative law judge shall not defer to the opinions of the examiner or agency1 but shall independently determine the appropriateness of the agency's decision based upon the relevant statutes1 regulations1 and other appropriate guidance4 7d7 ,final decision ,a decision by the ,ombudsman on an appeal under this section shall-- 7#a7 be made not later than #fj days after the record has been closed2 and 7#b7 be final agency action1 and shall bind the agency whose supervisory determination was the subject of the appeal and the financial institution making the appeal4 7e7 ,report ,the ,ombudsman shall report annually to the ,committee on ,financial ,services of the ,house of ,representatives1 the ,committee on ,banking1 ,housing1 and ,urban ,affairs of the ,senate on actions taken on appeals under this section1 including the types of issues that financial institutions have appealed and the results of those appeals4 ,in no case shall such a report contain information about individual financial institutions or any confidential or privileged information shared by financial institutions4 7f7 ,retaliation prohibited ,a ,federal financial institutions regulatory agency may not-- 7#a7 retaliate against a financial institution1 including service providers1 or any institution-affiliated party1 for exercising appellate rights under this section2 or 7#b7 delay or deny any agency action that would benefit a financial institution or any institution-affiliated party on the basis that an appeal under this section is pending under this section4 4 #f4 ,additional amendments 7a7 ,riegle ,community ,development and ,regulatory ,improvement ,act of #aiid ,section #cji of the ,riegle ,community ,development and ,regulatory ,improvement ,act of #aiid 7#ab ,u4,s4,c4 #dhjf7 is amended-- 7#a7 in subsection 7a71 by inserting after appropriate ,federal banking agency the following3 1 the ,bureau of ,consumer ,financial ,protection12 7#b7 in subsection 7b7-- 7,a7 in paragraph 7#b71 by striking the appellant from retaliation by agency examiners and inserting the insured depository institution or insured credit union from retaliation by an agency referred to in subsection 7a72 7,b7 by redesignating paragraphs 7#a7 and 7#b7 as subparagraphs 7,a7 and 7,b71 respectively1 and adjusting the margins accordingly2 7,c7 by striking ,in establishing and inserting the following3 7#a7 ,in general ,in establishing 2 and 7,d7 by adding at the end the following3 7#b7 ,retaliation ,for purposes of this subsection and subsection 7e71 retaliation includes delaying consideration of1 or withholding approval of1 any request1 notice1 or application that otherwise would have been approved1 but for the exercise of the institution's or credit union's rights under this section4 2 and 7#c7 in subsection 7e77#b7-- 7,a7 in subparagraph 7,b71 by striking and at the end2 7,b7 in subparagraph 7,c71 by striking the period and inserting 2 and2 and 7,c7 by adding at the end the following3 7,d7 ensure that appropriate safeguards exist for protecting the insured depository institution or insured credit union from retaliation by any agency referred to in subsection 7a7 for exercising its rights under this subsection4 4 7b7 ,federal ,deposit ,insurance ,act ,section #ah7x7 of the ,federal ,deposit ,insurance ,act 7#ab ,u4,s4,c4 #ahbh7x77 is amended by inserting the ,bureau of ,consumer ,financial ,protection1 before any ,federal banking agency each place that term appears4 7c7 ,federal ,credit ,union ,act ,section #bje7;j7 of the ,federal ,credit ,union ,act 7#ab ,u4,s4,c4 #aghe7;j77 is amended by inserting the ,bureau of ,consumer ,financial ,protection1 before the ,administration each place that term appears4 7d7 ,technical corrections ,the ,federal ,financial ,institutions ,examination ,council ,act of #aigh 7#ab ,u4,s4,c4 #ccja et seq47 is amended-- 7#a7 in section #ajjc7a7 7#ab ,u4,s4,c4 #ccjb7a771 by striking the ,office of ,thrift ,supervision12 and 7#b7 in section #ajje 7#ab ,u4,s4,c4 #ccjd71 by striking ,one-fifth and inserting ,one-fourth4