IMPROVED EXAMINATIONS.

SEC. 111. IMPROVED EXAMINATIONS. (a) In General.— Section 10 of the Federal Deposit Insurance Act (12 U.S.C. 1820) is amended by inserting after subsection (c) the following new subsection: “(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 105 STAT. 2241depository 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 $100,000,000; “(B) the institution is well capitalized, as defined in section 38; “(C) when the institution was most recently examined, it was found to be well managed, and its composite condition was found to be outstanding; and “(D) 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 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. “(6) Consumer compliance examinations excluded.— For purposes of this subsection, the term ‘full-scope, on-site examination’ does not include a consumer compliance examination, as defined in section 41(b).”. (b) Effective Date.— The amendment made by subsection (a) shall become effective 1 year after the date of enactment of this Act. (c) Transition Rule.— Notwithstanding section 10(d) of the Federal Deposit Insurance Act (as added by subsection (a)), during the period beginning on the date of enactment of this Act and ending on December 31, 1993, a full-scope, on-site examination of an insured depository institution is not required more often than once during every 18-month period, unless— (1) the institution, when most recently examined, was found to be in a less than satisfactory condition; or (2) 1 or more persons acquired control of the institution. (d) Examination Improvement Program.— (1) In general.— The appropriate Federal banking agencies, acting through the Federal Financial Institutions Examination Council, shall each establish a comparable examination improvement program that meets the requirements of paragraph (2). (2) Requirements.— An examination improvement program meets the requirements of this paragraph if, under the program, the agency is required— (A) to periodically review the organization and training of the staff of the agency who are responsible for conducting examinations of insured depository institutions and to make such improvements as the agency determines to be appropriate to ensure frequent, objective, and thorough examinations of such institutions; and (B) to increase the number of examiners, supervisors, and other individuals employed by the agency in connection with conducting or supervising examinations of insured depository institutions to the extent necessary to ensure 105 STAT. 2242frequent, objective, and thorough examinations of such institutions. (e) Technical and Conforming Amendment.— Section 3(s) of the Federal Deposit Insurance Act (12 U.S.C. 1813(s)) is amended to read as follows: “(s) Definitions Relating to Foreign Banks and Branches.— “(1) Foreign bank.— The term ‘foreign bank’ has the meaning given to such term by section 1(b)(7) of the International Banking Act of 1978. “(2) Federal branch.— The term ‘Federal branch’ has the meaning given to such term by section 1(b)(6) of the International Banking Act of 1978. “(3) Insured branch.— The term ‘insured branch’ means any branch (as defined in section 1(b)(3) of the International Banking Act of 1978) of a foreign bank any deposits in which are insured pursuant to this Act.”.