Ed Royce: “I rise in support of H.R. 974 and I would like to take just a moment to address a provision affecting the twenty-two…”

“I rise in support of H.R. 974 and I would like to take just a moment to address a provision affecting the twenty-two industrial banks in my State of California. Chairman Oxley was good enough to include in the Committee reported version of H.R. 974 a provision I requested offering a measure of equity and fairness to these twenty-two industrial banks as we implement a national policy permitting interest on business checking accounts. I want to thank him and his staff for their assistance in this matter. This provision, in Section 3 of H.R. 974, has now been amended to reflect comments offered by the Federal Reserve. The provision amends the Federal Deposit Insurance Act by adding a new paragraph (3) to Section 2 of that Act (PL-93-100). H.R. 974 would therefore permit a California industrial bank to offer to any account holder, including a business entity, interest bearing negotiable orders of withdrawal--commonly called NOW accounts--so long as applicable California law continues to prohibit industrial banks from offering demand deposit accounts--which it does, and so long as the California industrial bank is not an affiliate of any company or companies whose aggregate assets are more than ten percent of the total assets of that particular industrial bank. As a practical matter, I believe this provision would enable all of California's twenty-two industrial banks to offer NOW accounts to business entities, if they so choose.”