,i  #aaf? ,,congress  #b;d ,session  ,h4
 ,r4 #hhgb  ,,9 ,,! ,,h\se ,,(          
,,repres5tatives  ,decemb] #d1 #bjbj,mr4
 ,holl+swor? 7= himself & ,mr4 ,heck7   
introduc$ ! foll[+ bill2 :i* 0 ref]r$ to
 ! ,committee on ,f9ancial ,s]vices  ,a 
,,bill  ,to am5d ! ,f$]al ,home ,loan   
,bank ,act to enable captive insurance  
companies to apply = memb]%ip 9 ! ,f$]al
 ,home ,loan ,bank ,sy/em1 to add       
additional memb]%ip crit]ia = captive   
insurance companies1 to require a /udy  
on ,f$]al ,home ,loan ,bank memb]%ip1 & 
= o!r purposes4  #a4 ,%ort title ,?is   
,act may be cit$ z ! ,transp>5cy 9      
,f$]al ,home ,loan ,bank ,memb]%ip ,act 
( #bjbj4  #b4 ,def9itions ,section #b ( 
! ,f$]al ,home ,loan ,bank ,act 7#ab    
,u4,s4,c4 #adbb7 is am5d$ by add+ at !  
end ! foll[+3  7#ac7 ,captive insurance 
company ,! t]m captive insurance company
 means an insurance company ^: prim>y   
bus9ess is ! insurance ( its affiliates4
  7#ad7 ,insurance company ,! t]m       
insurance company means an entity t     

holds an insurance lic5se or *>t] "u !  
laws ( a ,/ate4  7#ae7 ,p>5t company ,! 
t]m p>5t company means ! ultimate p>5t  
company4  4  #c4 ,captive insurance     
company eligibility = memb]%ip  7a7 ,9  
g5]al ,section #d7;a7 ( ! ,f$]al ,home  
,loan ,bank ,act 7#ab ,u4,s4,c4         
#adbd7;a77 is am5d$ by add+ at ! end !  
foll[+3  7#f7 ,eligible captive         
insurance companies  7,a7 ,9 g5]al ,a   
captive insurance company %all be       
eligible to become a memb] ( a ,f$]al   
,home ,loan ,bank only if ! p>5t company
 ( ! captive insurance company meets !  
foll[+ requirem5ts3 7i7 ,mission        
alignm5t /&>ds  7,i7 ,h\s+ inve/m5t ,at 
lea/ #ea p]c5t ( ! total assets ( ! p>5t
 company are inve/$ 9 resid5tial        
mortgage loans4  7,,ii7 ,=m ( inve/m5ts 
,at lea/ #fj p]c5t ( ! total assets ( ! 
p>5t company are held 9 real e/ate      
assets1 ca% & ca% equival5ts1 & gov]nm5t
 securities 7z su* t]ms are us$ "u      
section #hef7;c77#d77;,a7 ( ! ,int]nal  
,rev5ue ,code ( #aihf74  7ii7 ,capital  

/&>ds ,su* capital /&>ds z ! ,director  
det]m9es appropriate1 by rule1 :i* %all 
be z close z practicable to ^? capital  
/&>ds applicable to insur$ depository   
in/itutions 7z def9$ "u section #c ( !  
,f$]al ,deposit ,insurance ,act74  7,b7 
,ongo+ memb]%ip  7i7 ,report+ requirem5t
 ,e #e ye>s aft] becom+ a memb] ( a     
,f$]al ,home ,loan ,bank1 a captive     
insurance company %all submit a report1 
prep>$ by a ?ird-p>ty auditor1 to !     
,director conta9+ in=mation on          
compliance by ! p>5t company ) !        
requirem5ts describ$ "u subp>agraph     
7,a74  7ii7 ,p>5t company requirem5ts ,a
 p>5t company ( a captive insurance     
company t is a memb] ( a ,f$]al ,home   
,loan ,bank %all-- 7,i7 ma9ta9 ! mission
 alignm5t /&>ds describ$ "u subp>agraph 
7,a77i72  7,,ii7 ma9ta9 ! capital /&>ds 
describ$ "u subp>agraph 7,a77ii72       
7,,iii7 be deem$ a regulat$ entity "u   
section #acad ( ! ,f$]al ,h\s+          
,ent]prises ,f9ancial ,safety &         
,s\ndness ,act ( #aiib 7#ab ,u4,s4,c4   

#dead72 &  7,,iv7 be subject to su*     
additional report+ requirem5ts z !      
,director det]m9es appropriate1 by rule4
  7iii7 ,failure to meet mission        
alignm5t /&>ds requirem5t ,if !         
,director det]m9es t a p>5t company no  
long] meets ! mission alignm5t /&>ds    
describ$ "u subp>agraph 7,a77i71 !      
,director %all require ! p>5t company to
 file qu>t]ly reports ) ! ,director = a 
#a-ye> p]iod1 %[+ h[ ! p>5t company is  
seek+ to comply ) su* mission alignm5t  
/&>ds4  7iv7 ,report on p>5t company    
compliance ) capital /&>ds  7,i7 ,9     
g5]al ,ea* captive insurance company t  
is a memb] ( a ,f$]al ,home ,loan ,bank 
%all issue a qu>t]ly report to ! ,bank  
conta9+ in=mation on ! compliance1 by ! 
p>5t company ( ! captive insurance      
company1 ) ! capital /&>ds describ$ "u  
subp>agraph 7,a77ii74  7,,ii7 ,report on
 non-compliance ,if a ,f$]al ,home ,loan
 ,bank receiv+ reports describ$ "u      
subclause 7,i7 det]m9es t a p>5t company
 has fail$ to meet ! capital /&>ds      

describ$ "u subp>agraph 7,a77ii7 = #b   
consecutive qu>t]s1 ! ,bank %all notify 
! ,director ( su* failure4  7v7 ,failure
 to meet capital /&>ds requirem5t ,if ! 
,director det]m9es t a p>5t company no  
long] meets ! capital /&>ds describ$ "u 
subp>agraph 7,a77ii71 ! ,director %all  
require ! p>5t company to file a capital
 re/oration plan ) ! ,director & !      
,f$]al ,home ,loan ,bank ) respect to   
:i* ! p>5t company's captive insurance  
company is a memb]4  7vi7 ,t]m9ation (  
memb]%ip ,a captive insurance company's 
memb]%ip ( a ,f$]al ,home ,loan ,bank   
%all be t]m9at$1 9 accordance ) section 
#f7;d77#b7 ( ! ,f$]al ,home ,loan ,bank 
,act 7#ab ,u4,s4,c4 #adbf7;d77#b771 if--
 7,i7 ! p>5t company ( ! captive        
insurance company does n submit a       
capital re/oration plan requir$ "u      
clause 7v7 t is sub/antially 9          
compliance ) section #acfi;,c ( ! ,f$]al
 ,h\s+ ,ent]prises ,f9ancial ,safety &  
,s\ndness ,act ( #aiib 7#ab ,u4,s4,c4   
#dfbb7 )9 ! applicable p]iod2  7,,ii7 ! 

,director does n approve su* a capital  
re/oration plan requir$ "u clause 7v72  
7,,iii7 ! ,director det]m9es t ! p>5t   
company has fail$ to comply ) su* a     
capital re/oration plan2 or  7,,iv7 )   
respect to a p>5t company t ! ,director 
has det]m9$ no long] meets ! mission    
alignm5t /&>ds describ$ "u subp>agraph  
7,a77i71 ! p>5t company has n return$ to
 compliance ) su* /&>ds be=e ! end ( !  
#a-ye> p]iod describ$ "u clause 7iii74  
7vii7 ,reapplication ,a captive         
insurance company ^: memb]%ip 9 a ,f$]al
 ,home ,loan ,bank is t]m9at$ "u clause 
7vi7 may n reapply = memb]%ip 9 a ,f$]al
 ,home ,loan ,bank until ! end ( !      
#e-ye> p]iod beg9n+ on ! date ( su*     
t]m9ation4  7,c7 ,p>5t company support  
7i7 ,9 g5]al ,! ,director %all require !
 p>5t company ( ! captive insurance     
company1 9 ! ev5t t ! captive insurance 
company defaults on any am\nts ow$ to a 
,f$]al ,home ,loan ,bank1 to pay ! ,bank
 ! am\nt ( any su* default4  7ii7       
,en=cem5t p[]s ,= purposes ( en=c+ ?is  

subp>agraph1 a p>5t company %all be     
deem$ a regulat$ entity "u sections     
#acga1 #acgb1 & #acgf ( ! ,f$]al ,h\s+  
,ent]prises ,f9ancial ,safety &         
,s\ndness ,act ( #aiib 7#ab ,u4,s4,c4   
#dfca1 #dfcb1 & #dfcf74  7,d7           
,cl>ification ( priority ( secur$       
int]e/s ,any security int]e/ grant$ to a
 ,f$]al ,home ,loan ,bank by any captive
 insurance company1 or by its p>5t      
company or any affiliate company on its 
behalf1 %all be entitl$ to priority ov] 
! claims & rights ( any p>ty 7includ+   
any receiv]1 cons]vator1 tru/ee1 or     
simil> p>ty hav+ rights ( a li5 cr$itor7
 o!r ?an claims & rights t-- 7i7 w\ld be
 entitl$ to priority "u o!rwise         
applicable law2 &  7ii7 are held by     
actual bona fide pur*as]s = value or by 
actual secur$ p>ties t are secur$ by    
actual p]fect$ security int]e/s4  4  7b7
 ,rulemak+ ,n lat] ?an ! end ( ! #a-ye> 
p]iod beg9n+ on ! date ( enactm5t ( ?is 
,act1 ! ,director ( ! ,f$]al ,h\s+      
,f9ance ,ag5cy %all issue ! capital     

/&>ds & report+ requirem5ts rules       
describ$ "u subp>agraphs 7,a77ii7 &     
7,b77ii77,,iv7 ( section #d7;a77#f7 ( ! 
,f$]al ,home ,loan ,bank ,act4  7c7     
,applicability ,section #d7;a77#f7 ( !  
,f$]al ,home ,loan ,bank ,act1 z add$ by
 subsection 7a71 %all take effect )     
respect to a captive insurance company  
on ! effective date ( ! rules requir$ "u
 subsection 7b74  7d7 ,captive insurance
 company eligibility transition p]iod ,a
 captive insurance company t has1 or w  
h1 ! company's memb]%ip 9 a ,f$]al ,home
 ,loan ,bank t]m9at$ due solely to !    
*ange 9 ! treatm5t ( captive insurance  
companies "u ! f9al rule ( ! ,f$]al     
,h\s+ ,f9ance ,ag5cy titl$ ,memb]s (    
,f$]al ,home ,loan ,banks 7#ha ,f$4     
,reg4 #cbdf2 publi%$ ,janu>y #bj1 #bjaf7
 may cont9ue memb]%ip or h memb]%ip     
re/or$1 z applicable1 9 ! same ,f$]al   
,home ,loan ,bank dur+ ! p]iod beg9n+ on
 ! date ( enactm5t ( ?is ,act & end+ on 
! day ! ,director issues ! rules requir$
 "u subsection 7b71 if-- 7#a7 ! ,f$]al  

,home ,loan ,bank det]m9es1 includ+ bas$
 on in=mation submitt$ by ! captive     
insurance company1 t-- 7,a7 ! affiliate 
insur$ by ! captive insurance company   
makes1 owns1 or acquires resid5tial     
mortgage loans2 &  7,b7 ! captive       
insurance company w comply ) ! memb]%ip 
eligibility requirem5ts describ$ 9      
p>agraphs 7a71 7b71 & 7c7 ( section     
#abfc4f ( title #ab1 ,code ( ,f$]al     
,regulations1 dur+ su* p]iod2 &  7#b7 ! 
captive insurance company cont9ues to be
 own$1 or ^u re/oration ( memb]%ip is   
own$ & cont9ues to be own$1 includ+     
direct own]%ip by a controll+ entity or 
indirect own]%ip ?r\gh "o or m hold+    
companies1 by ! same entity t own$ !    
captive insurance company on ! date (   
enactm5t ( ?is subsection4  #d4 ,/udy on
 impact ( expansion ( memb]%ip  7a7     
,/udy ,! ,director ( ! ,f$]al ,h\s+     
,f9ance ,ag5cy %all conduct a /udy on ! 
impact ( ! expansion ( ! ,f$]al ,home   
,loan ,bank ,sy/em to additional types (
 entities involv$ 9 ! h\s+ f9ance sy/em4

 ,! /udy %all consid]-- 7#a7 h[         
liquidity provid$ ?r\gh ! ,f$]al ,home  
,loan ,bank ,sy/em c\ld be increas$ 9 a 
mann] t is consi/5t ) its mission2  7#b7
 :at initial & ongo+ capital & report+  
requirem5ts = memb]%ip c\ld be us$ to   
m9imize risk to ! ,f$]al ,home ,loan    
,bank ,sy/em2  7#c7 h[ ! ,f$]al ,h\s+   
,f9ance ,ag5cy c\ld use its ov]sight &  
au?ority to ensure t exp&$ memb]%ip w\ld
 n pose excessive risk to ! ,f$]al ,home
 ,loan ,bank ,sy/em2  7#d7 mitigants &  
transaction /ructures to address risk ( 
an insolv5cy proce$+ affect+ ! p>5t ( a 
captive insurance company memb]2 &  7#e7
 o!r topics relevant to develop+ a      
framework = memb]%ip t promotes !       
mission ( ! ,f$]al ,home ,loan ,bank    
,sy/em4  7b7 ,report ,n lat] ?an "o ye> 
aft] ! date ( enactm5t ( ?is ,act1 !    
,director %all submit to ! ,committee on
 ,bank+1 ,h\s+1 & ,urban ,affairs ( !   
,s5ate & ! ,committee on ,f9ancial      
,s]vices ( ! ,h\se ( ,repres5tatives a  
report on ! /udy requir$ "u subsection  

7a71 includ+ all f9d+s & det]m9ations   
made 9 c>ry+ out ! /udy4