[Congressional Record Volume 172, Number 119 (Tuesday, July 21, 2026)]
[House]
[Pages H4707-H4731]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
MAIN STREET CAPITAL ACCESS ACT
Mr. HILL of Arkansas. Mr. Speaker, pursuant to House Resolution 1438,
I call up the bill (H.R. 6955) and ask for its immediate consideration
by the House.
The Clerk read the title of the bill.
The SPEAKER pro tempore (Mr. Bost). Pursuant to House Resolution
1438, in lieu of the amendment in the nature of a substitute
recommended by the Committee on Financial Services, printed in the
bill, an amendment in
[[Page H4708]]
the nature of a substitute consisting of the text of Rules Committee
Print 119-35 is adopted and the bill, as amended, is considered read.
The text of the bill, as amended, is as follows:
H.R. 6955
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Main
Street Capital Access Act'' or the ``Main Street Act''.
(b) Table of Contents.--The table of contents for this Act
is as follows:
Sec. 1. Short title; table of contents.
TITLE I--NEW BANK FORMATION AND LOCAL COMMUNITY ACCESS
Sec. 101. Promoting New Bank Formation.
Sec. 102. New Bank Application Numbers Knowledge.
Sec. 103. CDFI Fund Transparency.
Sec. 104. CDFI Bond Guarantee Improvement.
TITLE II--TAILORING BANK REGULATION
Sec. 201. Taking Account of Institutions with Low Operation Risk.
Sec. 202. Small Bank Holding Company Relief.
Sec. 203. Tailoring and Indexing Enhanced Regulations.
Sec. 204. Community Bank Regulatory Tailoring.
TITLE III--FAIR AND TRANSPARENT BANK SUPERVISION
Sec. 301. Halting Uncertain Methods and Practices in Supervision.
Sec. 302. Fair Audits and Inspections for Regulators' Exams.
Sec. 303. Supervisory Modifications for Appropriate Risk-based Testing.
Sec. 304. Financial Integrity and Regulation Management.
TITLE IV--REGULATORY ACCOUNTABILITY AND TRANSPARENCY
Sec. 401. FDIC Board Accountability.
Sec. 402. Stop Agency Fiat Enforcement of Guidance.
Sec. 403. Regulatory Efficiency, Verification, Itemization, and
Enhanced Workflow.
TITLE V--STRENGTHENING LOCAL BANK FUNDING
Sec. 501. Bringing the Discount Window into the 21st Century.
Sec. 502. Keeping Deposits Local.
TITLE VI--PROMOTING BANK COMPETITION AND MERGER CLARITY
Sec. 601. Bank Competition Modernization.
Sec. 602. Merger Agreement Approvals Clarity and Predictability.
Sec. 603. Merger Process Review.
Sec. 604. Bank Failure Prevention.
TITLE VII--STRENGTHENING TRANSPARENCY AND INVOLVEMENT IN BANK
RESOLUTIONS
Sec. 701. Least Cost Exception.
Sec. 702. Enhancing Bank Resolution Participation.
Sec. 703. Failing Bank Acquisition Fairness.
TITLE VIII--FACILITATING INNOVATION AND BANK PARTNERSHIPS
Sec. 801. Merchant Banking Modernization.
Sec. 802. Bank-Fintech Partnership Enhancement.
Sec. 803. Discretionary surplus fund.
TITLE I--NEW BANK FORMATION AND LOCAL COMMUNITY ACCESS
SEC. 101. PROMOTING NEW BANK FORMATION.
Section 908 of the 21st Century ROAD to Housing Act is
amended--
(1) in subsection (b)(2), by striking ``180-day'' and
inserting ``90-day'';
(2) in subsection (c)--
(A) in the heading, by inserting ``and Extension'' after
``Study'';
(B) by redesignating paragraph (2) as paragraph (3); and
(C) by inserting after paragraph (1) the following:
``(2) Safety and soundness determination; extension of
pilot program.--
``(A) Determination.--Not earlier than January 1, 2031, and
not later than June 30, 2031, the Federal banking agencies
may, jointly, determine that subsections (a) and (b) have had
a significant adverse effect on the safety and soundness of
qualifying community banks.
``(B) Extension.--Unless the Federal banking agencies make
the determination described in subparagraph (A), the
authorities under subsections (a) and (b) shall be permanent.
``(C) Termination.--If the Federal banking agencies make
the determination described in subparagraph (A)--
``(i) subsections (a) and (b) shall only apply to a
qualifying community bank that became an insured depository
institution before the date of such determination; and
``(ii) the Federal banking agencies shall issue a report to
the Committee on Financial Services of the House of
Representatives and the Committee on Banking, Housing, and
Urban Affairs of the Senate, and make such report available
to the public, containing such determination and the reasons
for such determination.''; and
(3) in subsection (e)(6)(B), by striking ``between January
1, 2026, and December 31, 2028'' and inserting ``on or after
January 1, 2026''.
SEC. 102. NEW BANK APPLICATION NUMBERS KNOWLEDGE.
(a) Annual Report on National Bank and Federal Savings
Association Charter Applications.--The Comptroller of the
Currency shall publish an annual report that includes the
following, or with respect to any equivalent procedure used
by the Office of the Comptroller of the Currency includes the
following:
(1) The number of applications for a national bank or
Federal savings association charter received, approved on a
preliminary basis, approved on a final basis, denied,
withdrawn, inactive, expired, mooted, returned, returned
pending resubmission, or otherwise dispositioned.
(2) The mean and median times for preliminary approval of
such applications.
(3) The mean and median times for final approval of such
applications.
(4) To the extent practicable, common reasons leading to
the denial, withdrawal, or expiration of preliminary approval
of such applications.
(b) Annual Report on Federal Credit Union Charter
Applications.--The National Credit Union Administration shall
publish an annual report that includes the following, or with
respect to any equivalent procedure used by the agency
includes the following:
(1) The number of Federal credit union charter applications
received, approved on a final basis, denied, withdrawn,
inactive, or returned pending resubmission.
(2) The mean and median times for final approval of such
applications.
(3) To the extent practicable, common reasons leading to
application denial, withdrawal, inactivity, or to
applications being returned for resubmission.
(c) Annual Report on Depository Institution Holding Company
Applications.--
(1) In general.--The Board of Governors of the Federal
Reserve System shall publish an annual report that includes
the following, or with respect to any equivalent procedure
used by the Board of Governors includes the following:
(A) The number of applications to become a top-tier
depository institution holding company received, approved on
a preliminary basis, approved on a final basis, denied,
withdrawn, inactive, expired, mooted, returned, returned
pending resubmission, or otherwise dispositioned.
(B) The mean and median times to approve such applications.
(C) To the extent practicable, common reasons leading to
denial or withdrawal of such applications.
(2) Top-tier depository institution holding company
defined.--In this subsection, the term ``top-tier depository
institution holding company'' means a depository institution
holding company (as defined in section 3 of the Federal
Deposit Insurance Act (12 U.S.C. 1813)) that is not
controlled by any other depository institution holding
company.
(d) Annual Report on Federal Deposit Insurance
Applications.--The Federal Deposit Insurance Corporation
shall publish an annual report that includes the following,
or with respect to any equivalent procedure used by the
Corporation includes the following:
(1) The number of applications for deposit insurance
received, approved on a preliminary basis, approved on a
final basis, denied, withdrawn, inactive, expired, mooted,
returned, returned pending resubmission, or otherwise
dispositioned.
(2) The mean and median times to approve such applications.
(3) To the extent practicable, common reasons leading to
denial or withdrawal of such applications.
(e) Annual Report on State Depository Institution and State
Credit Union Charter Applications.--
(1) In general.--The Board of Governors of the Federal
Reserve System, the Federal Deposit Insurance Corporation,
and the National Credit Union Administration Board shall,
jointly, and in consultation with State banking regulators
and State credit union regulators, publish an annual report
that includes the following, or with respect to any
equivalent procedure used by such agencies includes the
following:
(A) The number of applications for a State depository
institution charter received, approved on a preliminary
basis, approved on a final basis, denied, withdrawn,
inactive, expired, mooted, returned, returned pending
resubmission, or otherwise dispositioned.
(B) The mean and median times to approve such applications,
with times for each State shown separately.
(C) To the extent practicable, common reasons leading to
denial or withdrawal of such applications.
(2) Definitions.--In this subsection:
(A) State.--The term ``State'' means any State of the
United States, the District of Columbia, and any territory of
the United States.
(B) State depository institution.--The term ``State
depository institution'' means--
(i) a State depository institution, as defined in section 3
of the Federal Deposit Insurance Act (12 U.S.C. 1813); and
(ii) a State credit union, as defined in section 101 of the
Federal Credit Union Act (12 U.S.C. 1752).
SEC. 103. CDFI FUND TRANSPARENCY.
Section 104(b) of the Riegle Community Development and
Regulatory Improvement Act of 1994 (12 U.S.C. 4703(b)) is
amended by adding to the end the following:
``(5) Annual testimony.--The Secretary of the Treasury (or
a designee of the Secretary) shall, at the discretion of the
Chair of the Committee on Financial Services of the House of
Representatives and the Chair of the Committee on Banking,
Housing, and Urban Affairs of the Senate, annually testify
before such committees (or a subcommittee of such committees)
regarding--
``(A) the operations of the Fund during the previous year;
``(B) steps the Secretary and the Fund are taking to
support community development financial institutions through
the financial agent mentor-protege program; and
``(C) steps the Secretary and the Fund are taking to
coordinate with regulators to ensure
[[Page H4709]]
certification and reporting requirements are appropriately
streamlined for community development financial
institutions.''.
SEC. 104. CDFI BOND GUARANTEE IMPROVEMENT.
(a) Sense of Congress.--It is the sense of Congress that
the authority to guarantee bonds under section 114A of the
Community Development Banking and Financial Institutions Act
of 1994 (12 U.S.C. 4713a) (commonly referred to as the ``CDFI
Bond Guarantee Program'') provides community development
financial institutions with a sustainable source of long-term
capital and furthers the mission of the Community Development
Financial Institutions Fund (established under section 104(a)
of such Act (12 U.S.C. 4703(a))) to increase economic
opportunity and promote community development investments for
underserved populations and distressed communities in the
United States.
(b) Guarantees for Bonds and Notes Issued for Community or
Economic Development Purposes.--
(1) In general.--Section 114A of the Community Development
Banking and Financial Institutions Act of 1994 (12 U.S.C.
4713a) is amended--
(A) in subsection (c)(2)--
(i) by striking ``, multiplied by an amount equal to the
outstanding principal balance of issued notes or bonds''; and
(ii) by inserting ``outstanding'' before ``principal
amount'';
(B) by amending subsection (e)(2) to read as follows:
``(2) Limitation on guarantee amount.--The Secretary may
not guarantee any amount under the Program equal to an amount
less than $25,000,000, but the total of all such guarantees
in any fiscal year may not exceed $1,000,000,000.'';
(C) in subsection (g)(1), by striking ``10 basis points''
and inserting ``not fewer than 10 basis points and not more
than 15 basis points''; and
(D) in subsection (k), by striking ``September 30, 2014''
and inserting ``December 31, 2028''.
(2) Clerical amendment.--The table of contents in section
1(b) of the Riegle Community Development and Regulatory
Improvement Act of 1994 (Public Law 103-325; 108 Stat. 2160)
is amended by inserting after the item relating to section
114 the following:
``Sec. 114A. Guarantees for bonds and notes issued for community or
economic development purposes.''.
(c) Report on the CDFI Bond Guarantee Program.--Not later
than 3 years after the date of enactment of this Act, the
Secretary of the Treasury shall issue a report to the
Committee on Banking, Housing, and Urban Affairs of the
Senate and the Committee on Financial Services of the House
of Representatives on the effectiveness of the CDFI bond
guarantee program established under section 114A of the
Community Development Banking and Financial Institutions Act
of 1994 (12 U.S.C. 4713a).
TITLE II--TAILORING BANK REGULATION
SEC. 201. TAKING ACCOUNT OF INSTITUTIONS WITH LOW OPERATION
RISK.
(a) Tailoring Regulation to Business Model and Risk.--
(1) Definitions.--In this subsection--
(A) the term ``Federal financial institutions regulatory
agency'' means the Office of the Comptroller of the Currency,
the Board of Governors of the Federal Reserve System, the
Federal Deposit Insurance Corporation, the National Credit
Union Administration, and the Bureau of Consumer Financial
Protection; and
(B) the term ``regulatory action''--
(i) means any proposed, interim, or final rule or
regulation; and
(ii) does not include any action taken by a Federal
financial institutions regulatory agency that is solely
applicable to an individual institution, including an
enforcement action, adjudication, or order.
(2) Consideration and tailoring.--For any regulatory action
occurring after the date of enactment of this Act, each
Federal financial institutions regulatory agency shall--
(A) take into consideration the risk profile and business
models of each type of institution or class of institutions
subject to the regulatory action; and
(B) tailor the regulatory action applicable to a class or
type of institution in a manner that limits the regulatory
impact, including cost, human resource allocation, and other
burdens, on the institution or type of institution as is
appropriate for the risk profile and business model involved.
(3) Factors to consider.--In carrying out the requirements
of paragraph (2) with respect to a regulatory action, each
Federal financial institutions regulatory agency shall
consider--
(A) the aggregate effect of all applicable regulatory
actions promulgated by such agency on the ability of
institutions to flexibly serve customers of the institutions
and local markets on and after the date of enactment of this
Act;
(B) the potential that efforts to implement the regulatory
action and third-party service provider actions may work to
undercut efforts to tailor the regulatory action, as
described in paragraph (2)(B); and
(C) the statutory provision authorizing the regulatory
action, the congressional intent with respect to the
statutory provision, and the underlying policy objectives of
the regulatory action.
(4) Notice of proposed and final rulemaking.--Each Federal
financial institutions regulatory agency shall disclose and
document in every notice of proposed rulemaking and in any
final rulemaking for a regulatory action how the agency has
applied paragraphs (2) and (3).
(5) Reports to congress.--
(A) Agency reporting.--Not later than 1 year after the date
of enactment of this Act and annually thereafter, each
Federal financial institutions regulatory agency shall submit
to the Committee on Banking, Housing, and Urban Affairs of
the Senate and the Committee on Financial Services of the
House of Representatives a report on the specific actions
taken to tailor the regulatory actions of the Federal
financial institutions regulatory agency pursuant to the
requirements of this section.
(B) GAO reporting.--Not later than 18 months after the date
of enactment of this Act, the Comptroller General of the
United States shall submit to the Committee on Banking,
Housing, and Urban Affairs of the Senate and the Committee on
Financial Services of the House of Representatives a report
evaluating the effects of this section on the factors
described in paragraph (3).
(b) Short-form Call Reports for All Banks Eligible for the
Community Bank Leverage Ratio.--The appropriate Federal
banking agencies, as defined in section 3 of the Federal
Deposit Insurance Act (12 U.S.C. 1813), shall establish a
reduced reporting requirement for all banks eligible for the
Community Bank Leverage Ratio, as defined in section 201(a)
of the Economic Growth, Regulatory Relief, and Consumer
Protection Act (12 U.S.C. 5371 note), when making the first
and third report of condition of a year as required by
section 7(a) of the Federal Deposit Insurance Act (12 U.S.C.
1817(a)).
(c) Report to Congress on Modernization of Supervision.--
Not later than 18 months after the date of enactment of this
Act, the appropriate Federal banking agencies, as defined in
section 3 of the Federal Deposit Insurance Act (12 U.S.C.
1813), in consultation with State bank supervisors, shall
submit to the Committee on Banking, Housing, and Urban
Affairs of the Senate and the Committee on Financial Services
of the House of Representatives a report on the modernization
of bank supervision, including the following factors:
(1) Changing bank business models.
(2) Examiner workforce and training.
(3) The structure of supervisory activities within banking
agencies.
(4) Improving bank-supervisor communication and
collaboration.
(5) The use of supervisory technology.
(6) Supervisory factors uniquely applicable to community
banks.
(7) Changes in statutes necessary to achieve more effective
supervision.
SEC. 202. SMALL BANK HOLDING COMPANY RELIEF.
Not later than 180 days after the date of the enactment of
this Act, the Board of Governors of the Federal Reserve
System shall revise appendix C to part 225 of title 12, Code
of Federal Regulations (commonly known as the ``Small Bank
Holding Company and Savings and Loan Holding Company Policy
Statement''), to raise the consolidated asset threshold under
that appendix to $6,000,000,000 for any bank holding company
or savings and loan holding company.
SEC. 203. TAILORING AND INDEXING ENHANCED REGULATIONS.
(a) Periodic Adjustments to Thresholds.--The Financial
Stability Act of 2010 (12 U.S.C. 5311 et seq.) is amended by
adding at the end the following:
``SEC. 177. PERIODIC ADJUSTMENTS TO THRESHOLDS.
``(a) In General.--
``(1) Adjustment.--Not later than 1 year after the date of
enactment of this section, and every 5 years thereafter, the
Board of Governors shall increase each threshold described in
subsection (b) by the ratio, if greater than 1, of the annual
value of the economic indicator selected by the Board of
Governors as appropriate for that threshold under paragraph
(2)(B) for the calendar year preceding the year in which the
adjustment is calculated under this section, to the published
annual value of such economic indicator for the calendar year
preceding April 1, 2026.
``(2) Selection of economic indicators.--Not later than 3
months after the date of enactment of this section, the Board
of Governors shall--
``(A) complete a study on the advantages and disadvantages
of the use of either nominal United States gross domestic
product (as published by the Department of Commerce) or the
Consumer Price Index (as published by the Department of
Labor) to adjust periodically the quantitative regulatory
thresholds described in subsection (b);
``(B) for each threshold described in subsection (b),
select either nominal United States gross domestic product
(as published by the Department of Commerce) or the Consumer
Price Index (as published by the Department of Labor) as
appropriate for adjusting such threshold;
``(C) transmit a report to the Committee on Financial
Services of the House of Representatives and the Committee on
Banking, Housing, and Urban Affairs of the Senate
containing--
``(i) all findings and determinations made in carrying out
the study required under subparagraph (A); and
``(ii) all selections made under subparagraph (B).
``(b) Covered Thresholds.--The thresholds described in this
subsection are the following:
``(1) Each bank holding company or savings and loan holding
company total consolidated asset amount in the second
subsection (s) (relating to assessments) of section 11 of the
Federal Reserve Act.
``(2) Each bank holding company total consolidated asset
amount in--
``(A) sections 116(a), 121(a), 163(b), 164, 165(a)(1),
165(h)(2), 165(j)(1) of this Act; and
``(B) section 401(f) of the Economic Growth, Regulatory
Relief, and Consumer Protection Act.
``(3) Each financial company total consolidated asset
amount in section 165(i)(2)(A) of this Act.
[[Page H4710]]
``(c) Currency of Information.--The values used in the
calculation under subsection (a) shall be, as of the date of
the calculation, the values most recently published by the
Department of Commerce or Department of Labor, as
appropriate.
``(d) Rounding.--
``(1) If any amount equal to or greater than
$100,000,000,000 determined under subsection (a) for any
period is not a multiple of $50,000,000,000, the amount shall
be rounded up to the nearest $50,000,000,000.
``(2) If any amount less than $100,000,000,000 determined
under subsection (a) for any period is not a multiple of
$5,000,000,000, the amount shall be rounded up to the nearest
$5,000,000,000.
``(e) Publication.--Not later than April 5 of any calendar
year in which an adjustment is required to be calculated
under subsection (a), the Board of Governors shall publish in
the Federal Register the amounts as so calculated.
``(f) Implementation Period.--Any increase in amounts
determined under subsection (a) shall take effect on January
1 of the year immediately succeeding the calendar year in
which the increase is required to be calculated under
subsection (a).
``SEC. 178. PERIODIC ADJUSTMENTS TO THRESHOLDS ESTABLISHED BY
RULE.
``(a) Agency Review.--Not later than June 30, 2026, and the
1st day of each subsequent 5-year period, the Board of
Governors, the Comptroller of the Currency, and the
Corporation shall, to the extent applicable, review--
``(1) any regulation--
``(A) implementing section 165 of this Act; or
``(B) making specific cross-reference to any regulation of
the Board of Governors implementing section 165 of this Act;
and
``(2) any asset threshold or other quantitative threshold
in such regulations implementing section 165 of this Act, or
in such regulations making specific cross-reference to any
regulation of the Board of Governors implementing section 165
of this Act, the amount of which is not prescribed by
statute.
``(b) Modifications Required.--The Board of Governors, the
Comptroller of the Currency, and the Corporation shall modify
any such thresholds identified by each review conducted under
subsection (a) by the ratio, if greater than 1, of the annual
value of the economic indicator selected by the agency as
appropriate for that threshold under paragraph (1) for the
calendar year preceding the year in which the adjustment is
calculated under this section, to the published annual value
of such economic indicator for the calendar year preceding
the effective date of such threshold, as each respective
agency shall determine as appropriate for such regulations.
In making such determination, the Board of Governors, the
Comptroller of the Currency, and the Corporation shall--
``(1) not later than 3 months after the date of enactment
of this subsection, for each threshold identified by each
review conducted under subsection (a), select either nominal
United States gross domestic product (as published by the
Department of Commerce) or the Consumer Price Index (as
published by the Department of Labor) as appropriate for
adjusting such threshold, and use the values of such selected
economic indicator most recently published as of the date of
commencement of the review to compute the ratio described in
this subsection;
``(2) seek to establish, to the extent feasible, uniform
thresholds for use by each such agency, taking into account
the entities regulated by each such agency and the purposes
for which such threshold was established; and
``(3) seek to adjust such thresholds, to the extent
feasible, with rounding consistent with section 177(d) of
this Act.
``(c) Report.--Upon conclusion of each review required
under subsection (a), each of the Board of Governors, the
Comptroller of the Currency, and the Corporation shall
transmit a report to the Committee on Financial Services of
the House of Representatives and the Committee on Banking,
Housing, and Urban Affairs of the Senate containing a
description of any modification of any regulation such agency
made pursuant to subsection (b).''.
(b) Clerical Amendment.--The table of contents in section
1(b) of the Dodd-Frank Wall Street Reform and Consumer
Protection Act is amended by inserting after the item
relating to section 176 the following:
``Sec. 177. Periodic adjustments to thresholds.
``Sec. 178. Periodic adjustments to thresholds established by rule.''.
SEC. 204. COMMUNITY BANK REGULATORY TAILORING.
(a) Periodic Adjustments to Thresholds.--
(1) In general.--
(A) Adjustment.--By April 1, 2031, and the 1st day of each
subsequent 5-year period, the Board of Governors of the
Federal Reserve System shall prescribe the amount by which
each dollar amount described in subsection (b) shall be
increased by the ratio, if greater than 1, of the annual
value of the economic indicator selected by the Board of
Governors of the Federal Reserve System as appropriate for
that dollar amount under subparagraph (B) for the calendar
year preceding the year in which the adjustment is calculated
under this section, to the published annual value of such
economic indicator for the calendar year preceding April 1,
2026.
(B) Selection of economic indicators.--Not later than 3
months after the date of enactment of this Act, the Board of
Governors of the Federal Reserve System shall--
(i) complete a study on the advantages and disadvantages of
the use of either nominal United States gross domestic
product (as published by the Department of Commerce) or the
Consumer Price Index (as published by the Department of
Labor) to adjust periodically the dollar amounts described in
subsection (b);
(ii) for each dollar amount described in subsection (b),
select either nominal United States gross domestic product
(as published by the Department of Commerce) or the Consumer
Price Index (as published by the Department of Labor) as
appropriate for adjusting such dollar amount;
(iii) transmit a report to the Committee on Financial
Services of the House of Representatives and the Committee on
Banking, Housing, and Urban Affairs of the Senate
containing--
(I) all findings and determinations made in carrying out
the study required under clause (i); and
(II) all selections made under clause (ii).
(2) Currency of information.--The values used in the
calculation under paragraph (1) shall be, as of the date of
the calculation, the values most recently published by the
Department of Commerce or Department of Labor, as
appropriate.
(3) Rounding.--
(A) If any amount equal to or greater than $100,000,000,000
determined under paragraph (1) for any period is not a
multiple of $50,000,000,000, the amount shall be rounded up
to the nearest $50,000,000,000.
(B) If any amount less than $100,000,000,000 but equal to
or greater than $10,000,000,000 determined under paragraph
(1) for any period is not a multiple of $5,000,000,000, the
amount shall be rounded up to the nearest $5,000,000,000.
(C) If any amount less than $10,000,000,000 but equal to or
greater than $1,000,000,000 determined under paragraph (1)
for any period is not a multiple of $500,000,000, the amount
shall be rounded up to the nearest $500,000,000.
(D) If any amount less than $1,000,000,000 but equal to or
greater than $100,000,000 determined under paragraph (1) for
any period is not a multiple of $50,000,000, the amount shall
be rounded up to the nearest $50,000,000.
(E) If any amount less than $100,000,000 but equal to or
greater than $10,000,000 determined under paragraph (1) for
any period is not a multiple of $5,000,000, the amount shall
be rounded up to the nearest $5,000,000.
(F) If any amount less than $10,000,000 but equal to or
greater than $1,000,000 determined under paragraph (1) for
any period is not a multiple of $500,000, the amount shall be
rounded up to the nearest $500,000.
(G) If any amount less than $1,000,000 but equal to or
greater than $100,000 determined under paragraph (1) for any
period is not a multiple of $50,000, the amount shall be
rounded up to the nearest $50,000.
(H) If any amount less than $100,000 but equal to or
greater than $10,000 determined under paragraph (1) for any
period is not a multiple of $5,000, the amount shall be
rounded up to the nearest $5,000.
(I) If any amount less than $10,000 but equal to or greater
than $1,000 determined under paragraph (1) for any period is
not a multiple of $500, the amount shall be rounded up to the
nearest $500.
(J) If any amount less than $1,000 but equal to or greater
than $100 determined under paragraph (1) for any period is
not a multiple of $50, the amount shall be rounded up to the
nearest $50.
(K) If any amount less than $100 but equal to or greater
than $10 determined under paragraph (1) for any period is not
a multiple of $5, the amount shall be rounded up to the
nearest $5.
(L) If any amount less than $10 but equal to or greater
than $1 determined under paragraph (1) for any period is not
a multiple of $0.50, the amount shall be rounded up to the
nearest $0.50.
(4) Publication.--Not later than April 5 of any calendar
year in which an adjustment is required to be calculated
under paragraph (1), the Board of Governors of the Federal
Reserve System shall publish in the Federal Register the
dollar amounts as so calculated.
(5) Implementation period.--The increase in the dollar
amounts shall take effect on January 1 of the year
immediately succeeding any calendar year in which an
adjustment is required to be calculated under paragraph (1).
(b) Dollar Amounts.--The dollar amounts described in this
subsection are the dollar amounts described in each of the
following:
(1) Section 5(c)(3)(C)(ii) of the Bank Holding Company Act
of 1956 (12 U.S.C. 1844(c)(3)(C)(ii)).
(2) Section 809(a) of the Community Reinvestment Act of
1977 (12 U.S.C. 2908(a)).
(3) Sections 202(4), 203(1), and 204 of the Depository
Institution Management Interlocks Act (12 U.S.C. 3201 et
seq.).
(4) Sections 210(o), 210(r)(1)(A)(i), and section 956(f)
Dodd-Frank Wall Street Reform and Consumer Protection Act (12
U.S.C. 5301 et seq.).
(5) Sections 202(a)(6), 202(b)(1)(A), 202(c)(1)(A)(iii),
216(b)(2)(B)(iii)(II), 216(f)(2), 216(i)(4)(B), 216(j)(2)(A),
and 216(o)(4) of the Federal Credit Union Act (12 U.S.C. 1751
et seq.).
(6) Sections 7(a)(12), 11(p)(1)(A)(i), 36(i)(1)(B), 36(j),
38(b)(2)(A)(ii), and 38(k)(2)(B)(iii) of the Federal Deposit
Insurance Act (12 U.S.C. 1811 et seq.).
(7) Section 2(10) of the Federal Home Loan Bank Act (12
U.S.C. 1422(10)).
(8) Sections 7(a)(1) and 22(h)(5)(C) of the Federal Reserve
Act (12 U.S.C. 221 et seq.).
(9) The second paragraph (3) of section 304(i) (relating to
``Exemption from certain disclosure requirements'') and
section 309(a) of the Home Mortgage Disclosure Act of 1975
(12 U.S.C. 2801 et seq.).
(10) Section 5(u)(2)(A) of the Home Owners' Loan Act (12
U.S.C. 1464(u)(2)(A)).
(11) Section 909(a)(1) of the International Lending
Supervision Act of 1983 (12 U.S.C. 3908(a)(1)).
(12) Section 3(1)(B)(iv) of the Real Estate Settlement
Procedures Act of 1974 (12 U.S.C. 2602(1)(B)(iv)).
[[Page H4711]]
(13) Section 5136A(a)(2)(D)(ii) of the Revised Statutes of
the United States (12 U.S.C. 24a(a)(2)(D)(ii)).
(14) Section 129C(b)(2)(F)(i) of the Truth in Lending Act
(15 U.S.C. 1639c(b)(2)(F)(i)).
TITLE III--FAIR AND TRANSPARENT BANK SUPERVISION
SEC. 301. HALTING UNCERTAIN METHODS AND PRACTICES IN
SUPERVISION.
(a) Findings.--Congress finds that--
(1) CAMELS ratings (Capital adequacy, Asset quality,
Management, Earnings, Liquidity, and Sensitivity to market
risk) are a critical tool for evaluating the safety and
soundness of financial institutions, and the basis for
determining significant regulatory matters such as the
evaluation for mergers and acquisitions and a bank's deposit
insurance premiums;
(2) the CAMELS rating system relies heavily on examiner
judgment, which can lead to subjective and inconsistent
ratings across similar institutions;
(3) establishing articulable, clear, and reviewable
measures for each CAMELS component and their relative
weighting in determining composite ratings will promote
fairness, consistency, and accountability in supervisory
assessments; and
(4) examination and supervision, as well as the CAMELS
rating system, should focus on a financial institution's
material financial condition or solvency.
(b) Amendments to the CAMELS Rating System.--
(1) In general.--The Federal Financial Institutions
Examination Council Act of 1978 (12 U.S.C. 3301 et seq.) is
amended by adding at the end the following:
``SEC. 1012. AMENDMENTS TO THE CAMELS RATING SYSTEM.
``(a) In General.--The Council shall make recommendations
to amend the Uniform Financial Institutions Rating System,
and the CAMELS components thereunder, to--
``(1) establish articulable, clear, and reviewable criteria
for assessing each CAMELS component;
``(2) revise the factors affecting each CAMELS component to
derive a composite rating that more accurately reflects the
material financial condition and risk profile of the
financial institutions being rated;
``(3) revise the management component of the CAMELS
components to limit the assessment under such component to
articulable, clear, and reviewable measures of an
institution's management in relation to its risk profile;
``(4) ensure that composite ratings consider the financial
institution's compliance with--
``(A) section 21 of the Federal Deposit Insurance Act (12
U.S.C. 1829b);
``(B) chapter 2 of title I of Public Law 91-508 (12 U.S.C.
1951 et seq.);
``(C) subchapter II of chapter 53 of title 31, United
States Code; and
``(D) any other applicable requirements and implementing
regulations relating to the prevention of money laundering
and terrorist financing; and
``(5) ensure that composite ratings are determined based on
a transparent methodology that is limited to the objective
criteria established for each CAMELS component.
``(b) Rulemaking.--Not later than 12 months after the
Council makes the recommendations required under subsection
(a), the Federal financial institutions regulatory agencies
shall, jointly, issue rules to carry out the recommendations
described under subsection (a).
``(c) Public Comment Period.--In issuing the rules required
under subsection (b), the Federal financial institutions
regulatory agencies shall--
``(1) publish a notice of proposed rulemaking with respect
to such rules; and
``(2) provide for a public comment period of not less than
90 days.
``(d) Rule of Construction.--Nothing in this section may be
construed to limit the authority of the Federal financial
institutions regulatory agencies to take supervisory,
adjudicatory, or enforcement actions to ensure the safety and
soundness of financial institutions.''.
(2) Well managed definition.--
(A) Bank holding company act of 1956.--Section 2(o)(9)(A)
of the Bank Holding Company Act of 1956 (12 U.S.C.
1841(o)(9)(A)) is amended--
(i) by striking ``achievement of'' and all that follows
through ``a CAMEL'' and inserting ``achievement of a CAMEL'';
(ii) by striking ``; and'' and inserting ``; or''; and
(iii) by striking clause (ii).
(B) Revised statutes of the united states.--Section
5136A(g)(6)(A) of the Revised Statutes of the United States
(12 U.S.C. 24a(g)(6)(A)) is amended--
(i) by striking ``agency--'' and all that follows through
``the achievement'' and inserting ``agency, the
achievement'';
(ii) by striking ``; and'' and inserting ``; or''; and
(iii) by striking clause (ii).
SEC. 302. FAIR AUDITS AND INSPECTIONS FOR REGULATORS' EXAMS.
(a) Timeliness of Examinations and Examination Reports.--
The Federal Financial Institutions Examination Council Act of
1978 (12 U.S.C. 3301 et seq.), as amended by section
301(b)(1), is further amended by adding at the end the
following:
``SEC. 1013. TIMELINESS OF EXAMINATIONS AND EXAMINATION
REPORTS.
``(a) Timeliness of Examinations.--A Federal financial
institutions regulatory agency shall complete any examination
of a financial institution, other than a financial
institution subject to a continuous or resident examination
program, within 270 days of commencing the examination,
except that such period may be extended by the Federal
financial institutions regulatory agency by providing written
notice to the financial institution describing with
particularity the reasons that a longer period is needed.
``(b) Final Examination Report.--A Federal financial
institutions regulatory agency shall provide a final
examination report to a financial institution, other than a
financial institution subject to a continuous or resident
examination program, not later than 90 days after the later
of--
``(1) the exit interview for an examination of the
institution; or
``(2) the provision of additional material information by
the institution relating to the examination.
``(c) Exit Interview Requirement.--Within 30 days of
completing an examination for a financial institution not
subject to a continuous or resident examination program, a
Federal financial institutions regulatory agency shall
conduct an exit interview with the financial institution's
senior management or the board of directors, except that such
period may be extended by the Federal financial institutions
regulatory agency by providing written notice to the
institution describing with particularity the reasons that a
longer period is needed to complete the exit interview.
``(d) Examination Materials.--Upon the written request of a
financial institution, the Federal financial institutions
regulatory agency shall include with the final report an
appendix listing all examination or other factual information
relied upon by the agency in support of a material
supervisory determination.''.
(b) Timeliness of Required Prudential Private Letter
Rulings.--The Federal Financial Institutions Examination
Council Act of 1978 (12 U.S.C. 3301 et seq.), as amended by
subsection (a), is further amended by adding at the end the
following:
``SEC. 1014. TIMELINESS OF REQUIRED PRUDENTIAL PRIVATE LETTER
RULINGS.
``(a) Authority and Regulation.--
``(1) In general.--Each Federal financial institutions
regulatory agency shall establish procedures providing that a
covered financial institution may, upon application by the
covered financial institution and with respect to a covered
action, obtain written advice regarding--
``(A) the agency's non-objection to the financial
institution conducting a particular activity;
``(B) the agency's interpretation of a law or regulation as
applied to a particular matter;
``(C) the agency's interpretation of how generally accepted
accounting principles or accounting objectives, standards,
and requirements apply to a particular matter; or
``(D) the agency's application of any supervisory guidance,
statement of policy, or interpretive rule to a particular
matter.
``(2) Covered action defined.--In this subsection and with
respect to a covered financial institution, the term `covered
action' means--
``(A) any action in connection with a regulated activity
that the covered financial institution is taking or is
intending to take, including--
``(i) entering into a transaction;
``(ii) issuing a product or service; or
``(iii) changing the corporate structure of the covered
financial institution; and
``(B) a Federal financial institutions regulatory agency's
objection to the covered financial institution commencing or
otherwise conducting an activity (including an action
described in subparagraph (A)).
``(b) Contents of Request.--The procedures established
under subsection (a) shall provide that a request for written
advice made under the procedures shall be in writing and
contain--
``(1) the nature of the request;
``(2) applicable facts relating to the matter;
``(3) applicable law, regulations, or generally accepted
accounting principles relating to the matter; and
``(4) a summary of the request.
``(c) Response to Request.--A Federal financial
institutions regulatory agency receiving a request for
written advice under subsection (a) shall, not later than 30
days after receiving the request--
``(1) provide the financial institution making the request
with written notification confirming receipt of the request
and stating whether the request contains all of the
information required under subsection (b); and
``(2) if the request does not contain all of the
information required under subsection (b)--
``(A) provide the financial institution with an explanation
of what information is missing; and
``(B) notify the financial institution that the financial
institution may provide the missing information to the agency
within 30 days.
``(d) Providing Missing Information.--If a Federal
financial institutions regulatory agency informs the
financial institution under subsection (c) that the request
for written advice does not contain all the information
required under subsection (b), the financial institution may
provide the missing information to the Federal financial
institutions regulatory agency within 30 days of the date the
financial institution receives the explanation of the missing
information under subsection (c).
``(e) Determination.--A Federal financial institutions
regulatory agency receiving a request for written advice
under the procedures established under subsection (a) shall
provide the financial institution with a written response
(or, for purposes of paragraph (3), notify the financial
institution that a determination cannot be made)--
``(1) if the initial request contains the information
required under subsection (b), not later than the end of the
60-day period beginning on the date the Federal financial
institutions regulatory agency notifies the financial
institution of the receipt of the request under subsection
(c);
[[Page H4712]]
``(2) if the initial request does not contain the
information required under subsection (b), but the financial
institution provides the missing information during the 30-
day period described under subsection (d), not later than the
end of the 60-day period beginning on the date such missing
information is provided; or
``(3) if the initial request does not contain the
information required under subsection (b), and the financial
institution does not provide the missing information during
the 30-day period described under subsection (d), not later
than the end of the 60-day period beginning on the end of
such 30-day period.
``(f) Limited Binding Effect.--Written advice issued by a
Federal financial institutions regulatory agency under the
procedures established under this section--
``(1) shall be binding on the agency with respect to the
financial institution requesting the written advice and the
specific facts described in the request;
``(2) may be relied upon by the financial institution
requesting the written advice in good faith; and
``(3) shall not be binding on the agency with respect to
any other person or institution and shall not be treated as
precedent.
``(g) Confidentiality and Privilege.--
``(1) Treatment of written advice.--Written advice issued
under this section, and any materials submitted in connection
therewith, and the fact that a request for written advice was
made shall be treated as confidential supervisory information
and exempt from disclosure under section 552(b) of title 5,
United States Code.
``(2) Publishing of anonymized or redacted summaries.--A
Federal financial institutions regulatory agency may publish
anonymized or redacted summaries of rulings for informational
purposes.
``(h) Modification or Revocation.--A Federal financial
institutions regulatory agency may modify or revoke written
advice issued under this section only if--
``(1) the requesting financial institution made a material
misstatement or omission of fact;
``(2) there has been a change in controlling law; or
``(3) the ruling is inconsistent with a final rule or
judicial decision issued after the date the written advice
was issued.
``(i) Reasonable Fees.--Each Federal financial institutions
regulatory agency may establish and collect a reasonable fee
for the processing and issuance of any written advice issued
under this section, and such fee--
``(1) shall be based on the estimated cost to the agency of
reviewing, analyzing, and responding to the request;
``(2) may vary based on the complexity of the request or
the size of the requesting institution; and
``(3) shall be prescribed by regulation.
``(j) Finality.--Written advice issued under the procedures
established under this section shall not be construed as a
final agency action.''.
(c) Office of Independent Examination Review.--
(1) In general.--The Federal Financial Institutions
Examination Council Act of 1978 (12 U.S.C. 3301 et seq.), as
amended by subsection (b), is further amended by adding at
the end the following:
``SEC. 1015. OFFICE OF INDEPENDENT EXAMINATION REVIEW.
``(a) Establishment.--There is established in the Council
an Office of Independent Examination Review (the `Office').
``(b) Board of Independent Examination Review.--
``(1) In general.--The head of the Office shall be the
Board of Independent Examination Review, which shall be
comprised of 3 members, appointed by the President, by and
with the advice and consent of the Senate.
``(2) Qualifications.--The President shall appoint 1 member
of the Board from each of the following classes of
individuals:
``(A) Individuals who have been employed by a Federal
financial institutions regulatory agency.
``(B) Individuals who are not, and were not during the
previous 5-year period, employed by a Federal financial
institutions regulatory agency or a Federal reserve bank and
who--
``(i) are a licensed attorney or a certified public
accountant authorized to practice under the laws of a State,
the District of Columbia, or a territory of the United
States;
``(ii) have academic or private sector experience relating
to financial services; or
``(iii) have relevant work-related experience in consumer
affairs or compliance with consumer protection laws with
respect to financial institutions.
``(C) Individuals with at least 10 years private sector
financial services senior management-level experience.
``(3) Prohibition on certain individuals serving as a board
member.--The President may not appoint an individual as a
member of the Board if the individual--
``(A) is, or was during the previous 2-year period,
employed by a Federal financial institutions regulatory
agency or a Federal reserve bank; or
``(B) is, or was during the previous 2-year period,
employed by a financial institution.
``(4) Consultation.--In appointing members of the Board,
the President shall consult with the Federal financial
institutions regulatory agencies and financial institutions.
``(5) Term.--
``(A) In general.--Each member of the Board shall serve for
a term of 3 years. Upon the expiration of a member's terms of
office, the member shall continue to serve until the member's
successor has been confirmed by the Senate.
``(B) Term limitation.--No individual may serve more than 2
full terms on the Board.
``(6) Political affiliation.--Not more than 2 members of
the Board shall be members of the same political party.
``(7) Quorum.--
``(A) In general.--3 members of the Board shall constitute
a quorum.
``(B) Initial quorum.--During the 6-month period beginning
on the date of enactment of this section, 1 member of the
Board shall constitute a quorum until the Board has 3
members.
``(8) Rate of pay.--The annual rate of basic pay for the
members of the Board shall be the rate of basic pay for Level
IV of the Executive Schedule under section 5315 of title 5,
United States Code.
``(c) Staffing.--The Board is authorized to hire staff to
support the activities of the Office of Independent
Examination Review, and set the salaries of such staff. One-
fifth of the costs and expenses of the Office, including the
salaries of its employees, shall be paid by each of the
Federal financial institutions regulatory agencies. Annual
assessments for such share shall be levied by the Council
based upon its projected budget for the year, and additional
assessments may be made during the year if necessary.
``(d) Duties.--The Board shall--
``(1) receive and, at the discretion of the Board,
investigate complaints from financial institutions, their
representatives, or another entity acting on behalf of such
institutions, concerning completed examinations, examination
practices, or examination reports;
``(2) hold meetings, at least once every three months and
in locations designed to encourage participation from all
sections of the United States, with financial institutions,
their representatives, or another entity acting on behalf of
such institutions, to discuss examination procedures,
examination practices, or examination policies;
``(3) 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;
``(4) conduct a continuing and regular program of
examination quality assurance on a sample for all examination
types conducted by the Federal financial institutions
regulatory agencies;
``(5) carry out an independent review of any supervisory
appeal initiated under section 1016; and
``(6) report annually to the Committee on Financial
Services of the House of Representatives, the Committee on
Banking, Housing, and Urban Affairs of the Senate, and the
Council, on the reviews carried out pursuant to paragraphs
(3) and (5), including compliance with the requirements set
forth in section 1014 regarding timeliness of examination
reports, and the Board's recommendations for improvements in
examination procedures, practices, and policies.
``(e) Confidentiality.--
``(1) In general.--The Board and the Council shall keep
confidential--
``(A) all meetings, discussions, and information provided
by financial institutions and Federal financial institutions
regulatory agencies that involve confidential supervisory
information or privileged information;
``(B) all information and communications exchanged between
a financial institution and the Office of Independent
Examination Review; and
``(C) all information and communications exchanged between
a Federal financial institutions regulatory agency and the
Office of Independent Examination Review.
``(2) Submission of information does not constitute a
waiver.--Section 18(x) of the Federal Deposit Insurance Act
(12 U.S.C. 1828(x)) and section 205(j) of the Federal Credit
Union Act (12 U.S.C. 1785(j)) shall apply to the submission
of information to the Board by a financial institution or a
Federal financial institutions regulatory agency to the same
extent as such sections 18(x) and 205(j) apply to the
submission of information described in such sections 18(x)
and 205(j).
``(3) Sharing of information without waiving privilege.--
The Board shall be considered a `covered agency' for purposes
of section 11(t) of the Federal Deposit Insurance Act (12
U.S.C. 1821(t)).''.
(2) Definitions.--Section 1003 of the Federal Financial
Institutions Examination Council Act of 1978 (12 U.S.C. 3302)
is amended--
(A) in paragraph (2), by striking ``and'' at the end; and
(B) by adding at the end the following:
``(4) the term `Board' means the Board of Independent
Examination Review established under section 1015(b);
``(5) the term `material supervisory determination' has the
meaning given such term in section 309(c) of the Riegle
Community Development and Regulatory Improvement Act of 1994;
``(6) the term `insured depository institution' has the
meaning given that term in section 3 of the Federal Deposit
Insurance Act; and
``(7) the term `insured credit union' has the meaning given
that term in section 101 of the Federal Credit Union Act.''.
(d) Right to Independent Review of Material Supervisory
Determinations.--The Federal Financial Institutions
Examination Council Act of 1978 (12 U.S.C. 3301 et seq.), as
amended by subsection (c), is further amended by adding at
the end the following:
``SEC. 1016. RIGHT TO INDEPENDENT REVIEW OF MATERIAL
SUPERVISORY DETERMINATIONS.
``(a) In General.--A financial institution shall have the
right to obtain an independent review, as described in this
section, of a material supervisory determination contained in
a final report of examination. A Federal financial
institutions regulatory agency and the Board may not conduct
concurrent reviews.
``(b) Notice.--
``(1) Timing.--A financial institution seeking review of a
material supervisory determination under this section shall
file a written notice
[[Page H4713]]
with the Board within 30 days after receiving the final
report of examination that is the subject of such review.
``(2) Extension.--The institution may file a written
request with the Board for an extension of the 60-day time
period described under paragraph (1), which shall state good
cause for granting the extension. Such request shall be
granted in the sole discretion of the Board.
``(3) Identification of determination.--The written notice
shall--
``(A) identify the material supervisory determination that
is the subject of the requested independent examination
review;
``(B) state the reasons why the institution believes that
the material supervisory determination is incorrect or should
otherwise be modified; and
``(C) include--
``(i) a clear and complete statement of all relevant facts
and issues;
``(ii) all arguments that the institution wishes to
present; and
``(iii) all relevant and material documents in the
possession of the institution that the institution wishes to
be considered.
``(4) Information made available to institution.--A
financial institution seeking a review of a material
supervisory determination may, not later than 7 days after
receiving the final examination report, request that the
Federal financial institutions regulatory agency that made
the material supervisory determination provide the financial
institution with all examination and factual information
relied upon by the Federal financial institutions regulatory
agency in making the material supervisory determination. The
Federal financial institutions regulatory agency shall
provide such information to the financial institution not
later than 14 days after receiving the request.
``(5) Submission of record.--After receiving a written
notice of review from a financial institution under this
subsection, the Board shall direct the Federal financial
institutions regulatory agency that made the material
supervisory determination under review to file with the Board
the supervisory record of the examination resulting in the
material supervisory determination under review.
``(c) Determination; Right to Hearing.--
``(1) In general.--The Board shall--
``(A) determine the merits on the record, including whether
the material supervisory determination being reviewed should
be upheld, canceled, or modified; or
``(B) at the election of the financial institution, conduct
a hearing, which shall take place not later than 60 days
after the petition for review is received by the Board,
except that such 60-day period may be extended if both the
financial institution and the Board agree to such extension.
``(2) Right to obtain testimony.--A financial institution
electing for a hearing under paragraph (1)(B) shall have the
right the obtain testimony under oath from agency employees
and obtain documents and other evidence at the hearing, or in
advance of the hearing, according to procedures instituted by
the Board consistent with those set forth under sections 556
and 557 of title 5, United States Code.
``(3) Basis of decision.--The Board shall issue a written
decision based upon the record of the examination,
supplemented by the record established before the Board and
at any hearing.
``(4) Standard of review.--The Board's review of a material
supervisory determination being reviewed under this
subsection shall be de novo, and the Board shall not defer to
the opinions of the examiners or the Federal financial
institutions regulatory agency, but shall independently
determine the appropriateness of the material supervisory
determination based upon the relevant statutes, regulations,
other appropriate guidance, and the evidentiary record.
``(5) Policy matters.--The Board shall conduct reviews
under this section applying the policies, regulations, and
interpretations of the Federal financial institutions
regulatory agency that made the material supervisory
determination under review in effect at the time the material
supervisory determination was made.
``(d) Final Decision.--A decision by the Board on an
independent review under this section shall--
``(1) be made not later than 60 days after the record has
been closed; and
``(2) be deemed final and shall bind the agency whose
supervisory determination was the subject of the review and
the financial institution requesting the review.
``(e) Referral of Violations.--If the Board, in carrying
out this section, determines that a financial institution has
violated a law or regulation, the Board shall refer such
determination to the applicable Federal financial
institutions regulatory agency.
``(f) Annual Report.--
``(1) In general.--The Board shall report annually to the
Committee on Financial Services of the House of
Representatives, the Committee on Banking, Housing, and Urban
Affairs of the Senate, and the Council on actions taken under
this section, including the types of issues that the Board
has reviewed and the results of those reviews, including
information on each final determination with respect to a
material supervisory determination.
``(2) Confidentiality.--In reporting under paragraph (1),
the Board shall redact information about individual financial
institutions and any confidential supervisory information or
privileged information shared by financial institutions, and
shall anonymize any un-redacted information that could, in
the aggregate, identify a financial institution.
``(g) Retaliation Prohibited.--
``(1) In general.--A Federal financial institutions
regulatory agency may not--
``(A) retaliate against a financial institution, including
service providers, or any institution-affiliated party, for
exercising appellate rights under this section; or
``(B) 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 section.
``(2) Retaliation.--For purposes of this subsection,
retaliation includes delaying consideration of, or
withholding approval of, any request, notice, or application
that otherwise would have been approved, but for the exercise
of a financial institution's rights under this section.
``(h) Rulemaking.--The Board shall issue rules, consistent
with subchapter II of chapter 5 of title 5, United States
Code (commonly referred to as the `Administrative Procedure
Act'), to establish procedures for hearings described under
this section, including that--
``(1) a financial institution may appear at the hearing
personally or through counsel;
``(2) a financial institution may provide an oral and
written presentation at the hearing;
``(3) the Board may ask questions of any person
participating in the hearing;
``(4) the hearing shall not be governed by the Federal
Rules of Evidence; and
``(5) the Board shall have a verbatim transcript of the
hearing prepared.
``(i) Rule of Construction.--Nothing in this section may be
construed--
``(1) to affect the right of a Federal financial
institutions regulatory agency to take enforcement or other
supervisory actions related to a material supervisory
determination under review under this section; or
``(2) to prohibit the review under this section of a
material supervisory determination with respect to which
there is an ongoing enforcement or other supervisory
action.''.
(e) Additional Amendments.--
(1) Regulatory appeals process, ombudsman, and alternative
dispute resolution.--
(A) In general.--Section 309 of the Riegle Community
Development and Regulatory Improvement Act of 1994 (12 U.S.C.
4806) is amended--
(i) in the heading, by striking ``regulatory appeals
process, ombudsman,'' and inserting ``ombudsman'' (and by
conforming the item relating to such section in the table of
contents accordingly);
(ii) by striking subsections (a), (b), and (c);
(iii) by redesignating subsections (d), (e), (f), and (g)
as subsections (a), (b), (c), and (d), respectively;
(iv) in subsection (b), as so redesignated--
(I) in paragraph (2)--
(aa) in subparagraph (B), by striking ``and'' at the end;
(bb) in subparagraph (C), by striking the period and
inserting ``; and''; and
(cc) by adding at the end the following:
``(D) ensure that appropriate safeguards exist for
protecting any party from retaliation by any agency for
exercising rights under this subsection.''; and
(II) by adding at the end the following:
``(6) Retaliation.--For purposes of this subsection,
retaliation includes delaying consideration of, or
withholding approval of, any request, notice, or application
that otherwise would have been approved, but for the exercise
of a financial institution's rights under this section.'';
and
(v) in paragraph (1)(A) of subsection (c), as so
redesignated--
(I) in clause (ii), by striking ``; and'' and inserting a
semicolon;
(II) in clause (iii), by striking ``; and'' and inserting a
semicolon; and
(III) by adding at the end the following:
``(iv) any issue specifically listed in an exam report as a
matter requiring attention by the institution's management or
board of directors; and
``(v) any suspension or removal of an institution's status
as eligible for expedited processing of applications,
requests, notices, or filings on the grounds of a supervisory
or compliance concern, regardless of whether that concern has
been cited as a basis for a material supervisory
determination or matter requiring attention in an examination
report, provided that the conduct at issue did not involve
violation of any criminal law; and''.
(B) Effect.--Nothing in this subsection affects the
authority of a Federal banking agency (as defined in section
304(b)) to take enforcement or other supervisory action.
(2) Federal credit union act.--Section 205(j) of the
Federal Credit Union Act (12 U.S.C. 1785(j)) is amended by
inserting ``the Bureau of Consumer Financial Protection,''
before ``the Administration'' each place that term appears.
(3) Federal financial institutions examination council
act.--The Federal Financial Institutions Examination Council
Act of 1978 (12 U.S.C. 3301 et seq.) is amended--
(A) in section 1003 (12 U.S.C. 3302)--
(i) by striking paragraph (1) and inserting the following:
``(1) the term `Federal financial institutions regulatory
agencies'--
``(A) means the Office of the Comptroller of the Currency,
the Board of Governors of the Federal Reserve System, the
Federal Deposit Insurance Corporation, and the National
Credit Union Administration; and
``(B) includes the Bureau of Consumer Financial Protection
for purposes of sections 1012 through 1015;''; and
(ii) in paragraph (3), by striking the semicolon at the end
and inserting ``, except that for purposes of sections 1013
through 1016, the term `financial institution' does not
include a credit union that is not an insured credit
union;'';
(B) in section 1004(a)(4) (12 U.S.C. 3303), by striking
``Consumer Financial Protection Bureau'' and inserting
``Bureau of Consumer Financial Protection''; and
[[Page H4714]]
(C) in section 1005 (12 U.S.C. 3304)--
(i) by striking ``One-fifth'' and inserting ``One-fourth'';
and
(ii) by inserting ``described under section 1003(1)(A)''
after ``agencies''.
(f) Election of Forum for Review of Supervisory
Enforcement.--
(1) Federal deposit insurance act.--Section 8 of the
Federal Deposit Insurance Act (12 U.S.C. 1818) is amended--
(A) in subsection (b), by adding at the end the following:
``(11) Hearing.--With respect to any notice properly issued
and served upon a depository institution or institution-
affiliated party under this subsection, such depository
institution or institution-affiliated party shall be afforded
a hearing before--
``(A) the appropriate Federal banking agency; or
``(B) if such institution or person submits a request
within 20 days after the issuance of the notice, the
appropriate United States district court, and that court
shall have jurisdiction to adjudicate all claims and
requested remedies stated in the notice of charges, including
those authorized under this subsection.'';
(B) in subsection (e), by adding at the end the following:
``(8) Hearing.--With respect to any notice properly issued
and served upon an institution-affiliated party under this
subsection, such institution-affiliated party shall be
afforded a hearing before--
``(A) the appropriate Federal banking agency; or
``(B) if such party submits a request for such hearing and
forum within 20 days after the issuance of the notice, the
appropriate United States district court, and that court
shall have jurisdiction to adjudicate all claims and
requested remedies stated in the notice, including those
authorized under this subsection.'';
(C) in subsection (h)--
(i) in paragraph (1), by striking ``(other than the hearing
provided for in subsection (g)(3) of this section)'' and
inserting ``(other than the hearing provided for in
subsection (b)(11)(B), (e)(8)(B), (g)(3), or
(i)(2)(H)(ii))''; and
(ii) by adding at the end the following:
``(4) Any hearing provided for in subsection (b)(11)(B),
(e)(8)(B), or (i)(2)(H)(ii) shall be subject to the
jurisdiction, powers, and equitable authority of the district
court and be governed by the Federal Rules of Civil Procedure
and the Federal Rules of Evidence.
``(5) Any final decision of a United States district court
made pursuant to a respondent's election under subsection
(b)(11)(B), (e)(8)(B), or (i)(2)(H)(ii) shall be reviewable
in the appropriate court of appeals in the same manner and to
the same extent as any other civil action to which the United
States is a party.'';
(D) in subsection (i)(2)--
(i) by amending subparagraph (E)(ii) to read as follows:
``(ii) Finality of assessment.--If, with respect to any
assessment under clause (i), a hearing is not requested or an
election is not made and timely noticed pursuant to
subparagraph (H) within the period of time allowed under such
subparagraph, the assessment shall constitute a final and
unappealable order.'';
(ii) by amending subparagraph (H) to read as follows:
``(H) Hearing.--The insured depository institution or
institution-affiliated party against whom any penalty is
assessed under this paragraph shall be afforded a hearing
before--
``(i) an agency, if such institution or person submits a
request for such hearing within 20 days after the issuance of
the notice of assessment; or
``(ii) the appropriate United States district court, if
such institution or person submits a request for such hearing
and forum within 20 days after the issuance of the notice of
assessment.''; and
(iii) by amending subparagraph (I)(ii) to read as follows:
``(ii) Appropriateness of penalty not reviewable.--In any
civil action under clause (i), except a civil action tried in
a United States district court pursuant to subsection
(b)(11)(B), (e)(8)(B), or (i)(2)(H)(ii), the validity and
appropriateness of the penalty shall not be subject to
review.''; and
(E) by adding at the end the following:
``(x) Savings Clause.--Nothing in subsection (b)(11)(B),
(e)(8)(B), or (i)(2)(H)(ii) shall be construed to--
``(1) limit the authority of a Federal banking agency to
initiate an administrative enforcement action; or
``(2) impair the validity of any consent order.''.
(2) Federal credit union act.--Section 206 of the Federal
Credit Union Act (12 U.S.C. 1786) is amended--
(A) in subsection (e), by adding at the end the following:
``(5) Hearing.--With respect to any notice properly issued
and served upon an insured credit union, credit union which
has insured accounts, or an institution-affiliated party
under this subsection, such insured credit union, credit
union which has insured accounts, or institution-affiliated
party shall be afforded a hearing before--
``(A) the Administration; or
``(B) if such insured credit union, credit union which has
insured accounts, or institution-affiliated party submits a
request within 20 days after the issuance of the notice, the
appropriate United States district court, and that court
shall have jurisdiction to adjudicate all claims and
requested remedies stated in the notice of charges, including
those authorized under this subsection.'';
(B) in subsection (g), by adding at the end the following:
``(8) Hearing.--With respect to any notice properly issued
and served upon an institution-affiliated party under this
subsection, such institution-affiliated party shall be
afforded a hearing before--
``(A) the Administration; or
``(B) if such institution-affiliated party submits a
request within 20 days after the issuance of the notice, the
appropriate United States district court, and that court
shall have jurisdiction to adjudicate all claims and
requested remedies stated in the notice of charges, including
those authorized under this subsection.'';
(C) in subsection (j)--
(i) in paragraph (1), by striking ``(other than the hearing
provided for in subsection (i)(3) of this section)'' and
inserting ``(other than the hearing provided for in
subsection (e)(5)(B), (g)(8)(B), (i)(3), or (k)(2)(H)(ii))'';
and
(ii) by adding at the end the following:
``(4) Any hearing provided for in subsection (e)(5)(B),
(g)(8)(B), (i)(3), or (k)(2)(H)(ii) shall be subject to the
jurisdiction, powers, and equitable authority of the district
court and be governed by the Federal Rules of Civil Procedure
and the Federal Rules of Evidence.
``(5) Any final decision of a United States district court
made pursuant to a respondent's election under subsection
(e)(5)(B), (g)(8)(B), (i)(3), or (k)(2)(H)(ii) shall be
reviewable in the appropriate court of appeals in the same
manner and to the same extent as any other civil action to
which the United States is a party.'';
(D) in subsection (k)(2)--
(i) by amending subparagraph (E)(ii) to read as follows:
``(ii) Finality of assessment.--If, with respect to any
assessment under clause (i), a hearing is not requested or an
election is not made and timely noticed pursuant to
subparagraph (H) within the period of time allowed under such
subparagraph, the assessment shall constitute a final and
unappealable order.'';
(ii) by amending subparagraph (H) to read as follows:
``(H) Hearing.--The insured credit union or institution-
affiliated party against whom any penalty is assessed under
this paragraph shall be afforded a hearing before--
``(i) the Administration, if such insured credit union or
institution-affiliated party submits a request for such
hearing within 20 days after the issuance of the notice of
assessment; or
``(ii) the appropriate United States district court, if
such insured credit union or institution-affiliated party
submits a request for such hearing and forum within 20 days
after the issuance of the notice of assessment.''; and
(iii) by amending subparagraph (I)(ii) to read as follows:
``(ii) Appropriateness of penalty not reviewable.--In any
civil action under clause (i), except a civil action tried in
a United States district court pursuant to subsection
(e)(5)(B), (g)(8)(B), or (k)(2)(H)(ii), the validity and
appropriateness of the penalty shall not be subject to
review.''; and
(E) by adding at the end the following:
``(x) Savings Clause.--Nothing in subsection (e)(5)(B),
(g)(8)(B), or (k)(2)(H)(ii) shall be construed to--
``(1) limit the authority of the Administration to initiate
an administrative enforcement action; or
``(2) impair the validity of any consent order.''.
SEC. 303. SUPERVISORY MODIFICATIONS FOR APPROPRIATE RISK-
BASED TESTING.
(a) Examination Relief for Certain Well Managed and Well
Capitalized Financial Institutions.--
(1) Insured depository institutions.--Section 10(d) of the
Federal Deposit Insurance Act (12 U.S.C. 1820(d)) is amended
by adding at the end the following:
``(11) Examination relief for certain well managed and well
capitalized insured depository institutions.--
``(A) In general.--Notwithstanding paragraphs (1) and (2),
the following shall apply to a well managed and well
capitalized insured depository institution with
$6,000,000,000 or less in consolidated assets:
``(i) Alternating limited-scope examinations.--After an
insured depository institution receives a full-scope, on-site
examination from the appropriate Federal banking agency, the
next examination of the insured depository institution by the
appropriate Federal banking agency shall be a limited-scope
examination, as determined by the appropriate Federal banking
agency.
``(ii) Combined examinations.--If an insured depository
institution is otherwise subject to separate safety and
soundness examinations, consumer compliance examinations, and
information technology and cybersecurity examinations, the
appropriate Federal banking agency shall, upon request of the
insured depository institution, combine two or three such
examinations, as specified by the insured depository
institution, and carry them out at the same time.
``(B) Exception.--Subparagraph (A) shall not apply to an
insured depository institution if--
``(i) the insured depository institution is currently
subject to a formal enforcement proceeding or order by the
Corporation or the appropriate Federal banking agency; or
``(ii) a person acquired control of the insured depository
institution since the most recent full-scope, on-site
examination of the insured depository institution from the
appropriate Federal banking agency.
``(C) Rulemaking.--Not later than 12 months after the date
of enactment of this paragraph, the Federal banking agencies
shall issue rules to carry out subparagraph (A), including,
with respect to an insured depository institution described
under subparagraph (A), to--
``(i) establish procedures for the limited-scope
examinations described in subparagraph (A)(i);
``(ii) establish procedures for reviewing insured
depository institutions described under subparagraph (A),
that--
[[Page H4715]]
``(I) experience material changes in financial condition or
operational risk profile between scheduled examinations; or
``(II) have failed to comply with Federal or State banking
laws and regulations; and
``(iii) balance the goals of streamlining the examination
cycle for individual insured depository institutions and
reducing unnecessary regulatory burdens while maintaining
sufficient oversight to ensure the continued safety and
soundness of the insured depository institutions and
compliance with all applicable laws and regulations.
``(D) Rule of construction.--Nothing in this paragraph may
be construed to limit the authority of a Federal banking
agency to conduct off-site monitoring, targeted reviews, or
additional full-scope, on-site examinations of an insured
depository institution if the Federal banking agency
determines such monitoring, reviews, or examinations are
appropriate to ensure safety and soundness or compliance with
applicable laws.
``(E) Definitions.--In this paragraph:
``(i) Consumer compliance examination.--The term `consumer
compliance examination' means an examination to assess
compliance with the requirements of Federal consumer
financial law (as such term is defined in section 1002 of the
Consumer Financial Protection Act of 2010).
``(ii) Well capitalized.--The term `well capitalized' has
the meaning given that term in section 38(b).
``(iii) Well managed.--With respect to an insured
depository institution, the term `well managed' means that,
when the institution was most recently examined by the
appropriate Federal banking agency, the institution was found
to be well managed, and the institution's composite condition
was found to be satisfactory or outstanding.''.
(2) Insured credit unions.--Section 204 of the Federal
Credit Union Act (12 U.S.C. 1784) is amended by adding at the
end the following:
``(h) Examination Relief for Certain Well Managed and Well
Capitalized Insured Credit Unions.--
``(1) In general.--Notwithstanding any other provision of
this section, the following shall apply to a well managed and
well capitalized insured credit union with $6,000,000,000 or
less in consolidated assets:
``(A) Alternating limited-scope examinations.--After an
insured credit union receives a full-scope, on-site
examination from the National Credit Union Administration,
the next examination of the insured credit union by the
National Credit Union Administration shall be a limited-scope
examination, as determined by the National Credit Union
Administration.
``(B) Combined examinations.--If an insured credit union is
otherwise subject to separate safety and soundness
examinations, consumer compliance examinations, and
information technology and cybersecurity examinations, the
National Credit Union Administration shall, upon request of
the insured credit union, combine two or three such
examinations, as specified by the insured credit union, and
carry them out at the same time.
``(2) Exception.--Paragraph (1) shall not apply to an
insured credit union if the insured credit union is currently
subject to a formal enforcement proceeding or order by the
National Credit Union Administration.
``(3) Rulemaking.--Not later than 12 months after the date
of enactment of this subsection, the National Credit Union
Administration shall issue rules to carry out paragraph (1),
including, with respect to an insured credit union described
under paragraph (1), to--
``(A) establish procedures for the limited-scope
examinations described in paragraph (1)(A);
``(B) establish procedures for reviewing insured credit
unions that--
``(i) experience material changes in financial condition or
operational risk profile between scheduled examinations; or
``(ii) have failed to comply with Federal or State banking
laws and regulations; and
``(C) balance the goals of streamlining the examination
cycle for individual insured credit unions and reducing
unnecessary regulatory burdens while maintaining sufficient
oversight to ensure the continued safety and soundness of the
insured credit unions and compliance with all applicable laws
and regulations.
``(4) Rule of construction.--Nothing in this subsection may
be construed to limit the authority of the National Credit
Union Administration to conduct off-site monitoring, targeted
reviews, or additional full-scope, on-site examinations of an
insured credit union if the National Credit Union
Administration determines such monitoring, reviews, or
examinations are appropriate to ensure safety and soundness
or compliance with applicable laws.
``(5) Definitions.--In this paragraph:
``(A) Consumer compliance examination.--The term `consumer
compliance examination' means an examination to assess
compliance with the requirements of Federal consumer
financial law (as such term is defined in section 1002 of the
Consumer Financial Protection Act of 2010).
``(B) Well capitalized.--The term `well capitalized' has
the meaning given that term in section 216(c).
``(C) Well managed.--With respect to an insured credit
union, the term `well managed' means that, when the credit
union was most recently examined by the National Credit Union
Administration, the credit union was found to be well
managed, and the credit union's composite condition was found
to be satisfactory or outstanding.''.
(b) Examination Practices.--
(1) Insured depository institutions.--Section 10(d) of the
Federal Deposit Insurance Act (12 U.S.C. 1820(d)), as amended
by subsection (a)(1), is further amended by adding at the end
the following:
``(12) Examination practices.--With respect to on-site
examination of an insured depository institution with less
than $6,000,000,000 in total assets, the appropriate Federal
banking agency shall--
``(A) ensure the examination is led by, to the maximum
extent practicable, an examiner with significant experience
as an examiner;
``(B) make every effort, to the maximum extent practicable,
to minimize the number of examiners utilized and the amount
of time spent at the institution to carry out the
examination;
``(C) make every effort, to the maximum extent practicable,
to schedule the examination at a time that is convenient for
the institution; and
``(D) to the maximum extent practicable, give the
institution advance notice of issues expected to be covered
in the examination.
``(13) Report.--In its annual report to Congress, each
Federal banking agency shall include--
``(A) information on how the agency is complying with
paragraphs (11) and (12); and
``(B) aggregate data summarizing the agency's examination
practices with respect to insured depository institutions
with less than $6,000,000,000 in total assets, including--
``(i) the average experience of examiners, including the
average number of years of examiner experience of those who
lead on-site examinations;
``(ii) the average number of examiners utilized; and
``(iii) the average amount of time the agency spends
visiting such institutions for on-site examinations.''.
(2) Insured credit unions.--Section 204 of the Federal
Credit Union Act (12 U.S.C. 1784), as amended by subsection
(a)(2), is further amended by adding at the end the
following:
``(i) Examination Practices.--With respect to on-site
examination of an insured credit union with less than
$6,000,000,000 in total assets, the National Credit Union
Administration shall--
``(1) ensure the examination is led by, to the maximum
extent practicable, an examiner with significant experience
as an examiner;
``(2) make every effort, to the maximum extent practicable,
to minimize the number of examiners utilized and the amount
of time spent at the credit union to carry out the
examination;
``(3) make every effort, to the maximum extent practicable,
to schedule the examination at a time that is convenient for
the credit union; and
``(4) to the maximum extent practicable, give the credit
union advance notice of issues expected to be covered in the
examination.
``(j) Report.--In its annual report to Congress, the
National Credit Union Administration shall include--
``(1) information on how the Administration is complying
with subsections (h) and (i); and
``(2) aggregate data summarizing the Administration's
examination practices with respect to insured credit unions
with less than $6,000,000,000 in total assets, including--
``(A) the average experience of examiners, including the
average number of years of examiner experience of those who
lead on-site examinations;
``(B) the average number of examiners utilized; and
``(C) the average amount of time the Administration spends
visiting such credit unions for on-site examinations.''.
SEC. 304. FINANCIAL INTEGRITY AND REGULATION MANAGEMENT.
(a) Findings.--Congress finds that--
(1) the primary objective of financial regulation and
supervision by the Federal banking agencies is to promote
safety and soundness of depository institutions;
(2) all federally legal businesses and law-abiding citizens
regardless of political ideology should have equal
opportunity to obtain financial services and should not face
unlawful discrimination in obtaining such services;
(3) financial service providers are private entities
entitled to provide services to whichever customers they so
choose, provided that those decisions do not violate the law;
(4) financial service providers should strive to ensure
that all business decisions are based on factors free from
unlawful prejudice or political influence;
(5) the use of reputational risk in supervisory frameworks
encourages Federal banking agencies to regulate depository
institutions based on the subjective view of negative
publicity and provides cover for the agencies to implement
their own political agenda unrelated to the safety and
soundness of a depository institution;
(6) Federal banking agencies have in fact used reputational
risk to limit access of federally legal businesses and law-
abiding citizens to financial services in 2018 when the
Federal Deposit Insurance Corporation acknowledged that the
agency used reputational risk reviews to limit access to
financial services by certain industries, commonly known as
``Operation Choke Point''; and
(7) reputational risk does not appear in any statute and is
an unnecessary and improper use of supervisory authority that
does not contribute to the safety and soundness of the
financial system.
(b) Definitions.--In this section:
(1) Depository institution.--The term ``depository
institution''--
(A) has the meaning given the term in section 3 of the
Federal Deposit Insurance Act (12 U.S.C. 1813);
(B) includes a depository institution holding company, as
such term is defined in section 3 of the Federal Deposit
Insurance Act (12 U.S.C. 1813); and
(C) includes an insured credit union, as such term is
defined in section 101 of the Federal Credit Union Act (12
U.S.C. 1752).
(2) Federal banking agency.--The term ``Federal banking
agency''--
(A) has the meaning given the term in section 3 of the
Federal Deposit Insurance Act (12 U.S.C. 1813); and
[[Page H4716]]
(B) includes--
(i) the National Credit Union Administration; and
(ii) the Bureau of Consumer Financial Protection.
(3) Foreign terrorist organization.--The term ``foreign
terrorist organization'' means a foreign organization that is
designated by the Secretary of State in accordance with
section 219 of the Immigration and Nationality Act (8 U.S.C.
1189).
(4) Reputational risk.--The term ``reputational risk''
means the potential that negative publicity or negative
public opinion regarding a depository institution's business
practices, whether true or not, will cause a decline in
confidence in the institution or a decline in the customer
base, costly litigation, or revenue reductions or otherwise
adversely impact the depository institution. The previous
sentence does not apply to negative publicity or negative
public opinion regarding an institution's business practices
where such practices involve unlawful transactions in
connection with state sponsors of terrorism or foreign
terrorist organizations.
(5) State sponsors of terrorism.--The term ``state sponsors
of terrorism'' means a country, the government of which has
been determined by the Secretary of State to have repeatedly
provided support for acts of international terrorism, for
purposes of--
(A) section 1754(c)(1)(A)(i) of the Export Control Reform
Act of 2018 (50 U.S.C. 4813(c)(1)(A)(i));
(B) section 620A of the Foreign Assistance Act of 1961 (22
U.S.C. 2371);
(C) section 40(d) of the Arms Export Control Act (22 U.S.C.
2780(d)); or
(D) any other provision of law.
(c) Study on Reputational Risk.--Not later than 1 year
after the date of the enactment of this Act, each Federal
banking agency shall--
(1) carry out a study to evaluate the use of reputational
risk in the supervision of depository institutions; and
(2) determine whether the removal of reputational risk in
the supervision of depository institutions would threaten the
safety and soundness of those depository institutions.
(d) Removal of Reputational Risk as a Consideration in the
Supervision of Depository Institutions.--If a Federal banking
agency determines, under subsection (c), that the removal of
reputational risk in the supervision of depository
institutions would not threaten the safety and soundness of
those depository institutions, the Federal banking agency
shall remove from any guidance, rule, examination manual, or
similar document established by the agency any reference to
reputational risk, or any term substantially similar,
regarding the supervision of depository institutions such
that reputational risk, or any term substantially similar, is
no longer taken into consideration by the Federal banking
agency when examining and supervising a depository
institution.
(e) Prohibition.--If a Federal banking agency determines,
under subsection (c), that the removal of reputational risk
in the supervision of depository institutions would not
threaten the safety and soundness of those depository
institutions, the agency may not engage in rulemaking, the
issuance of guidance, supervision activities, or enforcement
activities related to the reputational risk of a depository
institution or the managing of reputational risk by a
depository institution, including--
(1) establishing any rule, regulation, requirement,
standard, or supervisory expectation concerning or related to
the reputational risk of a depository institution, or the
management thereof, whether binding or not;
(2) conducting any examination, assessment, data
collection, or other supervisory exercise concerning or
related to reputational risk of a depository institution, or
the management thereof;
(3) issuing any examination finding, supervisory criticism,
or other supervisory or examination communication concerning
or related to reputational risk of a depository institution,
or the management thereof;
(4) making any supervisory ratings decision or
determination that is based, in whole or in part, on any
matter concerning or related to reputational risk of a
depository institution, or the management thereof; and
(5) taking any formal or informal enforcement action that
is based, in whole or in part, on any matter concerning or
related to reputational risk of a depository institution, or
the management thereof.
(f) Reports.--Not later than 180 days after the date of
enactment of this Act, each Federal banking agency shall
submit to the Committee on Banking, Housing, and Urban
Affairs of the Senate and the Committee on Financial Services
of the House of Representatives a report that--
(1) confirms implementation of this section; and
(2) describes any changes made to internal policies as a
result of this section.
TITLE IV--REGULATORY ACCOUNTABILITY AND TRANSPARENCY
SEC. 401. FDIC BOARD ACCOUNTABILITY.
Section 2 of the Federal Deposit Insurance Act (12 U.S.C.
1812) is amended--
(1) by striking ``Consumer Financial Protection Bureau''
each place such term appears and inserting ``Bureau of
Consumer Financial Protection'';
(2) by amending subsection (a)(1)(C) to read as follows:
``(C) 3 of whom shall be appointed by the President, by and
with the advice and consent of the Senate, from among
individuals who are citizens of the United States, 1 of whom
shall have State bank supervisory experience, and separately
1 of whom shall have demonstrated primary experience working
in or supervising depository institutions having less than
$17,000,000,000 in total assets.''; and
(3) in subsection (c)--
(A) in paragraph (1), by adding at the end the following:
``No individual may be appointed as a member for more than
two terms.''; and
(B) by adding at the end the following:
``(4) Maximum length of service.--Notwithstanding any other
provision of this Act, no person shall serve as a member for
more than twelve years in total.''.
SEC. 402. STOP AGENCY FIAT ENFORCEMENT OF GUIDANCE.
(a) In General.--Each financial agency shall include a
guidance clarity statement as described in subsection (b) on
any guidance issued by that financial agency on and after the
date of the enactment of this Act.
(b) Guidance Clarity Statement.--A guidance clarity
statement required under subsection (a) shall be displayed
prominently on the first page of the document and shall
include the following: ``This guidance does not have the
force and effect of law and therefore does not establish any
rights or obligations for any person and is not binding on
the agency or the public. If this guidance suggests how
regulated entities may comply with applicable statutes or
regulations, noncompliance with this guidance does not
conclusively establish a violation of applicable law.''.
(c) Definitions.--In this section:
(1) Financial agency.--The term ``financial agency'' means
the following:
(A) The Bureau of Consumer Financial Protection.
(B) The Department of Housing and Urban Development.
(C) The Department of the Treasury.
(D) The Federal Deposit Insurance Corporation.
(E) The Federal Housing Finance Agency.
(F) The Board of Governors of the Federal Reserve System.
(G) The National Credit Union Administration.
(H) The Office of the Comptroller of the Currency.
(I) The Securities and Exchange Commission.
(2) Guidance.--The term ``guidance'' means a financial
agency statement of general applicability, intended to have a
future effect on the behavior of regulated parties, that sets
forth a policy on a statutory, regulatory, or technical
issue, or an interpretation of a statute or regulation, but
does not include--
(A) a rule promulgated pursuant to notice and comment under
section 553 of title 5, United States Code;
(B) a rule exempt from rulemaking requirements under
section 553(a) of title 5, United States Code;
(C) a rule of financial agency organization, procedure, or
practice under section 553(b)(A) of title 5, United States
Code;
(D) a decision of a financial agency adjudication under
section 554 of title 5, United States Code, or any similar
statutory provision;
(E) internal guidance directed to the issuing financial
agency or other agency that is not intended to have a
substantial future effect on the behavior of regulated
parties; or
(F) internal executive branch legal advice or legal
opinions addressed to executive branch officials.
SEC. 403. REGULATORY EFFICIENCY, VERIFICATION, ITEMIZATION,
AND ENHANCED WORKFLOW.
Section 2222 of the Economic Growth and Regulatory
Paperwork Reduction Act of 1996 (12 U.S.C. 3311) is amended--
(1) by striking ``appropriate Federal banking agency'' each
place such term appears and inserting ``Federal financial
institutions regulatory agency'';
(2) by striking ``appropriate Federal banking agencies''
and inserting ``Federal financial institutions regulatory
agencies'';
(3) in subsection (a)--
(A) by striking ``represented on the Council''; and
(B) by striking ``once every 10 years'' and inserting
``once every 8 years'';
(4) in subsection (b)--
(A) by redesignating paragraphs (1) and (2) as
subparagraphs (A) and (B), respectively (and adjusting the
margins accordingly);
(B) by striking ``In conducting'' and inserting the
following:
``(1) Solicitation of public comment.--In conducting''; and
(C) by adding at the end the following:
``(2) Internal review of cumulative impact.--Each Federal
financial institutions regulatory agency shall conduct an
internal review of the cumulative impact of regulations
issued by the Federal financial institutions regulatory
agency that--
``(A) assesses the effects of such regulations on
consumers' access to financial products and services;
``(B) assesses the effects of such regulations on the
availability of financial products and services to financial
and nonfinancial firms;
``(C) assesses the impact of such regulations on credit
availability and financial market liquidity in United States
financial markets;
``(D) assess the effects of such regulations on consumer
protection;
``(E) assesses the balance of benefits and costs of such
regulations with respect to the safety and soundness of the
United States financial system and overall economic activity
in the United States;
``(F) to the extent practicable, quantifies the direct and
indirect economic costs imposed by such regulations; and
``(G) includes recommendations to streamline or eliminate
duplicative, outdated, and unnecessarily burdensome
regulations.'';
(5) in subsection (c)--
(A) by striking ``subsection (b)(2)'' and inserting
``subsection (b)(1)(B), and the internal review under
subsection (b)(2),''; and
[[Page H4717]]
(B) by striking ``once every 10 years'' and inserting
``once every 8 years'';
(6) in subsection (e)--
(A) in paragraph (1), by striking ``and'' at the end;
(B) by redesignating paragraph (2) as paragraph (3);
(C) by inserting after paragraph (1) the following:
``(2) a summary of the findings and determinations of each
Federal financial institutions regulatory agency of the
internal review conducted by the Federal financial
institutions regulatory agency under subsection (b)(2);
and''; and
(D) in paragraph (3), as so redesignated, by striking ``the
regulatory burdens associated with such issues by
regulation'' and inserting ``the regulatory burdens
associated with the issues identified by public comments
received by the Council and the Federal financial
institutions regulatory agencies, as well as the regulatory
burdens identified by each Federal financial institutions
regulatory agency through the internal reviews conducted
under subsection (b)(2), by regulation''; and
(7) by adding at the end the following:
``(f) Federal Financial Institutions Regulatory Agency
Defined.--The term `Federal financial institutions regulatory
agency' has the meaning given that term in section 1003 of
the Federal Financial Institutions Examination Council Act of
1978 (12 U.S.C. 3302).''.
TITLE V--STRENGTHENING LOCAL BANK FUNDING
SEC. 501. BRINGING THE DISCOUNT WINDOW INTO THE 21ST CENTURY.
Section 10 of the Federal Reserve Act (12 U.S.C. 241 et
seq.) is amended by inserting after paragraph (10) the
following:
``(11) Review of discount window operations.--
``(A) In general.--Not later than 60 days after the date of
enactment of this paragraph, the Board of Governors shall
commence a review of the discount window lending programs of
the Federal reserve banks (the `discount window'), and shall
complete such review not later than 240 days after the date
of enactment of this paragraph.
``(B) Contents.--The review required by subparagraph (A)
shall include a consideration of--
``(i) the effectiveness of the discount window in providing
liquidity to financial institutions, including in times of
financial stress;
``(ii) whether the technology infrastructure, including
means of communications, are sufficient to support the timely
provision of liquidity, including in times of financial
stress;
``(iii) the effectiveness of cybersecurity measures
implemented with respect to discount window operations;
``(iv) the effectiveness of communications between Federal
reserve banks, financial institutions, the Board of
Governors, the Federal Deposit Insurance Corporation, the
Comptroller of the Currency, and the Secretary of the
Treasury regarding discount window operations;
``(v) the effectiveness of the Board of Governors in
providing oversight of the discount window and in ensuring
consistent access to the discount window across the Federal
Reserve System;
``(vi) how the discount window interacts with other
providers of liquidity, including the Federal Home Loan
Banks, during both normal operations and times of financial
distress;
``(vii) the effectiveness of existing discount window
operating hours and whether such hours should be expanded,
taking into account the interaction between discount window
operating hours and the operating hours of payment systems of
the Federal reserve banks, such as the Fedwire Funds Service
and FedNow Service;
``(viii) the impact of mobile banking and instant
communications technology on depositor behavior and liquidity
risk posed to financial institutions, including how the
discount window can--
``(I) help financial institutions better respond to rapid
liquidity shortfalls; and
``(II) prevent broader financial instability; and
``(ix) the effectiveness of the discount window in light of
the stigma associated with its usage, ways to reduce such
stigma, and ways to improve access, operational efficiency,
transparency, and timeliness of the process for financial
institutions seeking advances, including on the pricing and
other terms of such advances.
``(C) Remediation plan.--After the Board of Governors
completes the review required by subparagraph (A), the Board
of Governors, in consultation with the Federal reserve banks,
shall--
``(i) identify deficiencies with the discount window and
areas for enhancing discount window effectiveness; and
``(ii) develop a written plan to remediate the identified
deficiencies and implement the identified enhancements, which
shall include--
``(I) an identification of actions that will be taken to
enhance discount window effectiveness and remediate
identified deficiencies;
``(II) timelines and milestones for implementing the plan
and measures to demonstrate how the implemented improvements
will be maintained on an ongoing basis; and
``(III) measures of managing and controlling any
deficiencies and current operations until the plan is
implemented in full.
``(D) Report to congress on review and plan.--
``(i) In general.--Not later than 365 days after the date
of enactment of this paragraph, the Board of Governors shall
submit a report to the Committee on Financial Services of the
House of Representatives and the Committee on Banking,
Housing, and Urban Affairs of the Senate containing--
``(I) the findings of the review required by subparagraph
(A); and
``(II) the remediation plan required by subparagraph (C).
``(ii) Consultation.--Before submitting the report required
by clause (i), the Board of Governors shall--
``(I) provide a copy of the proposed report to the
Comptroller of the Currency, the Federal Deposit Insurance
Corporation, the National Credit Union Administration, and
the Secretary of the Treasury; and
``(II) provide the Comptroller of the Currency, the Federal
Deposit Insurance Corporation, the National Credit Union
Administration, and the Secretary of the Treasury with an
opportunity to provide feedback on the report.
``(iii) Testimony.--The Chairman of the Board of Governors
shall, at the semi-annual hearing required under section 2B,
testify with respect to the contents of the report required
under this subparagraph.
``(E) Annual reports to congress.--
``(i) Reports by the board.--The Board of Governors shall
submit an annual report to the Committee on Financial
Services of the House of Representatives and the Committee on
Banking, Housing, and Urban Affairs of the Senate containing
a review of the effectiveness of discount window operations
and a progress report on the actions taken to implement the
identified enhancements described in subparagraph (C).
``(ii) Reports by the inspector general.--The Inspector
General of the Board of Governors of the Federal Reserve
System and the Bureau of Consumer Financial Protection shall
submit an annual report to the Committee on Financial
Services of the House of Representatives and the Committee on
Banking, Housing, and Urban Affairs of the Senate containing
a report on the progress of the Board of Governors in
implementing the remediation plan required by subparagraph
(C).
``(F) Confidential report information.--Any report required
under this paragraph may contain a confidential annex
containing information that, if made public, could--
``(i) impact monetary policy, financial stability, or
cybersecurity; or
``(ii) significantly endanger the safety and soundness of
any financial institution.
``(G) Repeal.--This paragraph shall be repealed on the date
on which the Board of Governors notifies the Congress and
publishes on a public website of the Board of Governors that
the remediation plan required under subparagraph (C) has been
fully implemented.''.
SEC. 502. KEEPING DEPOSITS LOCAL.
(a) Amount of Reciprocal Deposits That Are Not Considered
To Be Funds Obtained by or Through a Deposit Broker.--Section
29(i)(1)(C) of the Federal Deposit Insurance Act (12 U.S.C.
1831f(i)(1)(C)) is amended by striking ``$96,333,333,333''
and inserting ``$250,000,000,000''.
(b) Definition of Agent Institution.--Section 29(i) of the
Federal Deposit Insurance Act (12 U.S.C. 1831f(i)) is
amended--
(1) in paragraph (2)(A)--
(A) in clause (i), by striking subclause (I) and inserting
the following:
``(I) when most recently examined under section 10(d) was
assigned a CAMELS rating of 1, 2, or 3 under the Uniform
Financial Institutions Rating System (or an equivalent rating
under a comparable rating system); and'';
(B) by redesignating clauses (ii) and (iii) as clauses
(iii) and (iv), respectively; and
(C) by inserting after clause (i) the following:
``(ii) has not yet been examined under section 10(d) and
the deposits of which first became insured under this Act
during the current calendar year or during the immediately
preceding calendar year;''; and
(2) by adding at the end the following:
``(3) Reservation of authority.--If an insured depository
institution ceases to be an agent institution because it no
longer satisfies any of the criteria in paragraph (2)(A), the
Corporation may, on a case-by-case basis and upon
application, provide a waiver to permit the institution to
continue to consider some or all of the deposits previously
subject to the exception under paragraph (1) as continuing to
be subject to the exception under paragraph (1), for a
specific or indefinite period of time, if the Corporation
determines that failure to grant such a waiver would
negatively impact the safety and soundness of the insured
depository institution.''.
(c) Reciprocal Deposits Study.--
(1) In general.--The Federal Deposit Insurance Corporation,
in consultation with the Board of Governors of the Federal
Reserve System, shall carry out a study on reciprocal
deposits.
(2) Contents.--The study required under paragraph (1) shall
include--
(A) an analysis of how reciprocal deposits have performed
since 2018, which shall include--
(i) the use of quantitative and qualitative data;
(ii) a breakdown of the usage of reciprocal deposits by
size of insured depository institution;
(iii) the usage of reciprocal deposits during periods of
stress; and
(iv) an analysis, to the extent practicable, of end-user
depositors, such as municipalities, businesses, and non-
profit organizations, that drive demand for reciprocal
products;
(B) an analysis, to the extent practicable, of how
reciprocal deposits compare to other deposit arrangements;
and
(C) an analysis of the benefits and potential risks of
reciprocal deposits.
(3) Report.--Not later than 6 months after the date of
enactment of this Act, the Federal Deposit Insurance
Corporation shall issue a report to the Committee on
Financial Services of the House of Representatives and the
Committee on Banking, Housing, and Urban Affairs of the
Senate containing all findings and determinations made in
carrying out the study required under paragraph (1).
[[Page H4718]]
TITLE VI--PROMOTING BANK COMPETITION AND MERGER CLARITY
SEC. 601. BANK COMPETITION MODERNIZATION.
(a) In General.--Section 18(c) of the Federal Deposit
Insurance Act (12 U.S.C. 1828(c)), as amended by section
604(c), is further amended--
(1) in paragraph (4)(C)--
(A) in clause (i), by striking ``or'' at the end;
(B) in clause (ii), by striking the period at the end and
inserting ``; or''; and
(C) by adding at the end the following:
``(iii) the proposed merger transaction would result in an
entity with less than $10,000,000,000 in assets and would not
result in there being only one insured depository institution
with a physical presence in any relevant metropolitan
statistical area.''; and
(2) by adding at the end the following:
``(16) For Merger Transactions Resulting in Institutions
With Less Than $10,000,000,000 in Assets and That Would Not
Result in There Being Only One Insured Depository Institution
With a Physical Presence in Any Relevant Metropolitan
Statistical Area.--Notwithstanding paragraph (5), if a
proposed merger transaction would result in an institution
with less than $10,000,000,000 in assets and would not result
in there being only one insured depository institution with a
physical presence in any relevant metropolitan statistical
area, then the responsible agency shall not consider whether
such merger transaction would--
``(A) result in a monopoly, or would be in furtherance of
any combination or conspiracy to monopolize or to attempt to
monopolize the business of banking in any part of the United
States; and
``(B) have the effect in any section of the country of
substantially lessening competition, tending to create a
monopoly, or in any other manner restraining trade.''.
(b) For Bank Holding Companies.--Section 3(c) of the Bank
Holding Company Act of 1956 (12 U.S.C. 1842(c)) is amended by
adding at the end the following:
``(8) For proposed transactions resulting in companies with
less than $10,000,000,000 in assets and that would not result
in there being only one insured depository institution with a
physical presence in any relevant metropolitan statistical
area.--Notwithstanding paragraph (1), if a proposed
acquisition, merger, or consolidation under this section
would result in a company with less than $10,000,000,000 in
assets and would not result in there being only one insured
depository institution with a physical presence in any
relevant metropolitan statistical area, then the Board shall
not consider whether such acquisition, merger, or
consolidation would--
``(A) result in a monopoly, or would be in furtherance of
any combination or conspiracy to monopolize or to attempt to
monopolize the business of banking in any part of the United
States; and
``(B) have the effect in any section of the country of
substantially lessening competition, tending to create a
monopoly, or in any other manner restraining trade.''.
(c) For Savings and Loan Holding Companies.--Section 10(e)
of the Home Owners' Loan Act (12 U.S.C. 1467a(e)), as amended
by section 604(b), is further amended by adding at the end
the following:
``(10) For proposed transactions resulting in companies
with less than $10,000,000,000 in assets and that would not
result in there being only one insured depository institution
with a physical presence in any relevant metropolitan
statistical area.--Notwithstanding subparagraphs (A) and (B)
of paragraph (2), if a proposed transaction under this
section would result in a company with less than
$10,000,000,000 in assets and would not result in there being
only one insured depository institution with a physical
presence in any relevant metropolitan statistical area, then
the Board shall not consider whether the transaction would--
``(A) result in a monopoly, or would be in furtherance of
any combination or conspiracy to monopolize or to attempt to
monopolize the savings and loan business in any part of the
United States; and
``(B) have the effect in any section of the country of
substantially lessening competition, tending to create a
monopoly, or in any other manner restraining trade.''.
SEC. 602. MERGER AGREEMENT APPROVALS CLARITY AND
PREDICTABILITY.
(a) Study.--The Comptroller General of the United States
shall carry out a study on the use of commitments,
conditions, and other aspects of merger review procedures by
Federal depository institution regulatory agencies in
connection with insured depository institution merger
applications. The study shall--
(1) include an evaluation of relevant quantifiable metrics;
(2) review the extent to which the use of commitments and
conditions has aligned with statutory requirements, including
a review of whether the use of commitments and conditions has
been influenced by extrastatutory issues or considerations;
(3) consider the benefits and risks of utilizing different
merger review approaches and procedures in compliance with
the law; and
(4) include an evaluation of the impact of such merger
review procedures and resulting approved mergers on safety
and soundness, financial stability, competition, and the
availability of financial products and services offered by
insured depository institutions.
(b) Report.--Not later than 1 year after the date of
enactment of this Act, the Comptroller General shall issue a
report to the Committee on Financial Services of the House of
Representatives and the Committee on Banking, Housing, and
Urban Affairs of the Senate containing all findings and
determinations made in carrying out the study required under
subsection (a).
(c) Definitions.--In this section:
(1) Application.--The term ``application'' means an
application, notice, or other similar request for permission
submitted to a Federal depository institution regulatory
agency.
(2) Federal depository institution regulatory agency.--The
term ``Federal depository institution regulatory agency''
means the Board of Governors of the Federal Reserve System,
the Comptroller of the Currency, the Federal Deposit
Insurance Corporation, and the National Credit Union
Administration Board.
(3) Insured depository institution.--The term ``insured
depository institution''--
(A) has the meaning given that term in section 3 of the
Federal Deposit Insurance Act (12 U.S.C. 1813); and
(B) means an insured credit union, as defined in section
101 of the Federal Credit Union Act (12 U.S.C. 1752).
(4) Insured depository institution merger application.--The
term ``insured depository institution merger application''
means an application with respect to the acquisition of an
insured depository institution, its equity interests, its
assets, or its deposits under--
(A) section 10(e) of the Home Owners' Loan Act (12 U.S.C.
1467a(e));
(B) section 205(b) of the Federal Credit Union Act (12
U.S.C. 1785(b));
(C) section 7(j) of the Federal Deposit Insurance Act (12
U.S.C. 1817(j));
(D) section 18(c)(2) of the Federal Deposit Insurance Act
(12 U.S.C. 1828(c)(2));
(E) section 3 of the Bank Holding Company Act of 1956 (12
U.S.C. 1842); and
(F) section 4 of the Bank Holding Company Act of 1956 (12
U.S.C. 1843).
SEC. 603. MERGER PROCESS REVIEW.
(a) Review.--Not later than 1 year after the date of
enactment of this Act, and every 3 years thereafter, the
Inspector General of each Federal depository institution
regulatory agency shall review the Federal depository
institution regulatory agency's merger review procedures,
including record of timeliness and efficiency in reviewing
and acting upon insured depository institution merger
applications. The review shall--
(1) include an evaluation of relevant quantifiable metrics,
including mean and median application processing times;
(2) identify sources of delay that may hinder the timely
consummation of proposals that meet the relevant statutory
factors;
(3) consider the benefits and risks of utilizing different
merger review approaches and procedures in compliance with
the law;
(4) include an evaluation of the impact of such merger
review procedures and resulting approved mergers on safety
and soundness, financial stability, competition, and the
availability of financial products and services offered by
insured depository institutions; and
(5) include specific recommendations to improve the merger
review process, including timeliness and efficiency of
application processing, consistent with the Federal
depository institution regulatory agency's statutory
responsibilities.
(b) Report.--Each Inspector General described under
subsection (a) shall, at the conclusion of each review
required under subsection (a), issue a report to the
Committee on Financial Services of the House of
Representatives and the Committee on Banking, Housing, and
Urban Affairs of the Senate containing all findings and
determinations made in carrying out the review, and publish
such report online.
(c) Agency Response.--In response to each report issued
under subsection (a), the appropriate Federal depository
institution regulatory agency shall submit to the Committee
on Financial Services of the House of Representatives and the
Committee on Banking, Housing, and Urban Affairs of the
Senate and publish online a written response, including a
plan to implement the recommendations in the report, to the
extent such implementation is appropriate.
(d) Definitions.--In this section:
(1) Application.--The term ``application'' means an
application, notice, or other similar request for permission
submitted to a Federal depository institution regulatory
agency.
(2) Federal depository institution regulatory agency.--The
term ``Federal depository institution regulatory agency''
means the Board of Governors of the Federal Reserve System,
the Comptroller of the Currency, the Federal Deposit
Insurance Corporation, and the National Credit Union
Administration.
(3) Insured depository institution.--The term ``insured
depository institution''--
(A) has the meaning given that term in section 3 of the
Federal Deposit Insurance Act (12 U.S.C. 1813); and
(B) means an insured credit union, as defined in section
101 of the Federal Credit Union Act (12 U.S.C. 1752).
(4) Insured depository institution merger application.--The
term ``insured depository institution merger application''
means an application with respect to the acquisition of an
insured depository institution, its equity interests, its
assets, or its deposits under--
(A) section 10(e) of the Home Owners' Loan Act (12 U.S.C.
1467a(e));
(B) section 205(b) of the Federal Credit Union Act (12
U.S.C. 1785(b));
(C) section 7(j) of the Federal Deposit Insurance Act (12
U.S.C. 1817(j));
(D) section 18(c)(2) of the Federal Deposit Insurance Act
(12 U.S.C. 1828(c)(2));
(E) section 3 of the Bank Holding Company Act of 1956 (12
U.S.C. 1842); and
(F) section 4 of the Bank Holding Company Act of 1956 (12
U.S.C. 1843).
SEC. 604. BANK FAILURE PREVENTION.
(a) Bank Holding Companies.--Section 3(b)(1) of the Bank
Holding Company Act of 1956 (12 U.S.C. 1842(b)(1)) is
amended--
[[Page H4719]]
(1) by striking ``Upon receiving'' and inserting the
following:
``(A) In general.--Upon receiving'';
(2) by striking ``required'' and inserting ``acquired'';
(3) by striking ``In the event of the failure of the Board
to act on any application for approval under this section
within the ninety-one-day period which begins on the date of
submission to the Board of the complete record on that
application, the application shall be deemed to have been
granted.''; and
(4) by adding at the end the following:
``(B) Complete record on an application.--
``(i) Notice to applicant.--Not later than 30 days after
the date on which the Board receives an application for
approval under this section, the Board shall transmit to the
applicant a letter that either--
``(I) confirms the record on the application is complete;
or
``(II) details all additional information that is required
for the record on that application to be complete.
``(ii) Extension of notice.--Notwithstanding clause (i),
the Board may, if an application is complex, extend the 30-
day period described under clause (i) for an additional
period not to exceed 60 days.
``(iii) Receipt of response; deeming of complete record.--
Upon receipt of a response from an applicant to a notice
requesting additional information described under clause
(i)(II), the record on the application shall be deemed
complete unless the Board--
``(I) determines that the applicant's response was
materially deficient; and
``(II) not later than 30 days after the date on which the
Board received the response, provides the applicant a
detailed notice describing the deficiencies.
``(iv) Treatment of third-party information.--In
determining whether the record on an application is complete,
the Board may take into account only information provided by
the applicant, and may not base the determination of
completeness on any information (including reports, views, or
recommendations) provided by third parties.
``(C) Deadline for determination.--
``(i) In general.--Notwithstanding subparagraphs (A) and
(B), the Board shall grant or deny an application submitted
under this section not later than 120 days after the date on
which the application was initially submitted to the Board,
regardless of whether the record on such initial application
was complete.
``(ii) Failure to make a determination.--If the Board does
not grant or deny an application within the time period
described under clause (i), such application shall be deemed
to have been granted.
``(iii) Tolling of period.--The Board may at any time
extend the deadline described under clause (i) at the request
of the applicant, but may not extend the deadline more than
30 days past the deadline described under clause (i).''.
(b) Savings and Loan Holding Companies.--Section 10(e) of
the Home Owners' Loan Act (12 U.S.C. 1467a(e)) is amended--
(1) in paragraph (2), by striking ``, and shall render a
decision within 90 days after submission to the Board of the
complete record on the application'';
(2) by redesignating paragraph (7) as paragraph (9); and
(3) by inserting after paragraph (6) the following:
``(7) Complete record on an application.--
``(A) Notice to applicant.--Not later than 30 days after
the date on which the Board receives an application for
approval under this subsection, the Board shall transmit to
the applicant a letter that either--
``(i) confirms the record on the application is complete;
or
``(ii) details all additional information that is required
for the record on that application to be complete.
``(B) Extension of notice.--Notwithstanding subparagraph
(A), the Board may, if an application is complex, extend the
30-day period described under subparagraph (A) for a period
not to exceed 60 days.
``(C) Receipt of response; deeming of complete record.--
Upon receipt of a response from an applicant to a notice
requesting additional information described under
subparagraph (A)(ii), the record on the application shall be
deemed complete unless the Board--
``(i) determines that the applicant's response was
materially deficient; and
``(ii) not later than 30 days after the date on which the
Board received the response, provides the applicant a
detailed notice describing the deficiencies.
``(D) Treatment of third-party information.--In determining
whether the record on an application is complete, the Board
may take into account only information provided by the
applicant, and may not base the determination of completeness
on any information (including reports, views, or
recommendations) provided by third parties.
``(8) Deadline for determination.--
``(A) In general.--Notwithstanding any other provision of
this subsection, the Board shall grant or deny an application
submitted under this subsection not later than 120 days after
the date on which the application was initially submitted to
the Board, regardless of whether the record on such initial
application was complete.
``(B) Failure to make a determination.--If the Board does
not grant or deny an application within the time period
described under subparagraph (A), such application shall be
deemed to have been granted.
``(C) Tolling of period.--The Board may at any time extend
the deadline described under subparagraph (A) at the request
of the applicant, but may not extend the deadline more than
30 days past the deadline described under subparagraph
(A).''.
(c) Insured Depository Institutions.--Section 18(c) of the
Federal Deposit Insurance Act (12 U.S.C. 1828(c)) is amended
by adding at the end the following:
``(14) Complete Record on an Application.--
``(A) Notice to applicant.--Not later than 30 days after
the date on which the responsible agency receives a merger
application for approval under this subsection, the
responsible agency shall transmit to the applicant a letter
that either--
``(i) confirms the record on the application is complete;
or
``(ii) details all additional information that is required
for the record on that application to be complete.
``(B) Extension of notice.--Notwithstanding subparagraph
(A), the responsible agency may, if an application is
complex, extend the 30-day period described under
subparagraph (A) for a period not to exceed 60 days.
``(C) Receipt of response; deeming of complete record.--
Upon receipt of a response from an applicant to a notice
requesting additional information described under
subparagraph (A)(ii), the record on the application shall be
deemed complete unless the responsible agency--
``(i) determines that the applicant's response was
materially deficient; and
``(ii) not later than 30 days after the date on which the
responsible agency received the response, provides the
applicant a detailed notice describing the deficiencies.
``(D) Treatment of third-party information.--In determining
whether the record on an application is complete, the
responsible agency may take into account only information
provided by the applicant, and may not base the determination
of completeness on any information (including reports, views,
or recommendations) provided by third parties.
``(15) Deadline for Determination.--
``(A) In general.--Notwithstanding any other provision of
this subsection, the responsible agency shall grant or deny a
merger application submitted under this subsection not later
than 120 days after the date on which the application was
initially submitted to the responsible agency, regardless of
whether the record on such initial application was complete.
``(B) Failure to make a determination.--If the responsible
agency does not grant or deny an application within the time
period described under subparagraph (A), such application
shall be deemed to have been granted.
``(C) Tolling of period.--The responsible agency may at any
time extend the deadline described under subparagraph (A) at
the request of the applicant, but may not extend the deadline
more than 30 days past the deadline described under
subparagraph (A).''.
TITLE VII--STRENGTHENING TRANSPARENCY AND INVOLVEMENT IN BANK
RESOLUTIONS
SEC. 701. LEAST COST EXCEPTION.
(a) In General.--Section 13(c)(4) of the Federal Deposit
Insurance Act (12 U.S.C. 1823(c)(4)) is amended--
(1) in subparagraph (A)(ii), by inserting ``except as
provided in subparagraph (I),'' before ``the total amount'';
(2) in subparagraph (E)(i), by inserting ``and except as
provided in subparagraph (I),'' after ``appropriate,''; and
(3) by adding at the end the following:
``(I) Least cost resolution exception.--
``(i) In general.--With respect to an exercise of authority
by the Corporation described in subparagraph (A), the
Corporation may, at the discretion of the Corporation, select
an alternative method of exercising such authority that is
not the least costly to the Deposit Insurance Fund, if--
``(I) the Corporation determines that the selected
alternative complies with the requirements of clause (iii);
and
``(II) the Corporation and the Board of Governors of the
Federal Reserve System, after consultation with the Secretary
of the Treasury, determine that the potential additional
risks to the Deposit Insurance Fund of the selected
alternative are outweighed by the reasonably expected
benefits of limiting further concentration of the United
States banking system in global systemically important
banking organizations.
``(ii) Maximum cost to the deposit insurance fund.--Not
later than 1 year after the date of enactment of this
subparagraph, the Corporation, by rule, shall establish
criteria for determining on a case-by-case basis the maximum
allowable cost against the net worth of the Deposit Insurance
Fund that may be utilized to account for any determination
under clause (i).
``(iii) Requirements described.--The requirements for the
selected alternative described in clause (i) are as follows:
``(I) The selected alternative is least costly to the
Deposit Insurance Fund of all alternatives that do not
involve a transaction with a global systemically important
banking organization and that do not exceed the cost of
liquidating the insured depository institution.
``(II) The difference between the cost of the selected
alternative and the cost of a covered alternative is less
than or equal to the maximum cost to the Deposit Insurance
Fund specified pursuant to the rule adopted under clause
(ii).
``(III) In the case of a selected alternative that involves
another person purchasing assets of the insured depository
institution or assuming deposit liabilities of the insured
depository institution, such person agrees to pay an
assessment to the Corporation comprised of payments--
``(aa) made over a period to be determined by the
Corporation, but which may not be less than 5 years; and
``(bb) in an amount that takes into account, on a case-by-
case basis, criteria the Corporation, by rule, shall
establish, including a realistic discount rate, the aggregate
amount equal
[[Page H4720]]
to the difference calculated in subclause (II), and any bid
inconsistent with the purposes of this Act, with such rule to
be established by the Corporation not later than 1 year after
the date of enactment of this subparagraph.
``(iv) Report to congress.--Not later than 30 days after
selecting an alternative described in clause (i), the
Corporation shall issue a report to the Committee on
Financial Services of the House of Representatives and the
Committee on Banking, Housing, and Urban Affairs of the
Senate containing an analysis of the economic difference
between the cost to the Deposit Insurance Fund of the
selected alternative and the cost to the Deposit Insurance
Fund of the least costly alternative that would have been
selected absent the application of this subparagraph.
``(v) Cost determinations.--All cost determinations
required under this subparagraph shall be made in accordance
with subparagraphs (B) and (C).
``(vi) Definitions.--In this subparagraph:
``(I) Covered alternative.--The term `covered alternative'
means a method of exercising authority described in
subparagraph (A) that is the least costly to the Deposit
Insurance Fund of all such methods that involve a sale of all
or substantially all assets of the insured depository
institution to, and assumption of all or substantially all
deposit liabilities of the insured depository institution by,
a global systemically important banking organization.
``(II) Global systemically important banking
organization.--The term `global systemically important
banking organization' means a global systemically important
BHC (as such term is defined in section 217.402 of title 12,
Code of Federal Regulations, or any successor thereto) and
any affiliate thereof.''.
(b) Rule of Construction.--Section 13(c)(4)(H) of the
Federal Deposit Insurance Act (12 U.S.C. 1823(c)(4)(H)) does
not apply to the amendments made by subsection (a).
SEC. 702. ENHANCING BANK RESOLUTION PARTICIPATION.
(a) Study.--The Comptroller of the Currency, the Federal
Deposit Insurance Corporation, and the Board of the Governors
of the Federal Reserve System shall, jointly, carry out a
study of--
(1) the use by the Comptroller of the Currency of shelf
charters, including all conditional or preliminary shelf
charter approvals granted between January 1, 2008, and the
date of enactment of this Act;
(2) the use by the Federal Deposit Insurance Corporation of
the modified bidder qualification process;
(3) the application of the Bank Holding Company Act of 1956
(12 U.S.C. 1841 et seq.) and section 10 of the Home Owners'
Loan Act (12 U.S.C. 1467a) to shelf charter proposals;
(4) whether shelf charters and modified bidder
qualification processes were considered or used in connection
with the receivership of any insured depository institution
for which the Federal Deposit Insurance Corporation was
appointed receiver in 2023;
(5) with respect to such receiverships, the extent to which
greater use of shelf charters and modified bidder
qualification processes could have--
(A) expanded the pool of participants in the acquisition of
the assets or liabilities of such failed insured depository
institutions;
(B) resulted in greater competition and diversity in market
outcomes;
(C) protected the Deposit Insurance Fund; or
(D) strengthened financial stability and reduced the need
for any emergency determination by the Secretary of the
Treasury under section 13(c)(4)(G) of the Federal Deposit
Insurance Act (12 U.S.C. 1823(c)(4)(G)) with respect to any
such receivership;
(6) the impact of the use of shelf charters and modified
bidder qualification processes since January 1, 2008,
including on financial stability, the safety and soundness of
affected insured depository institutions, and the
availability of financial products and services provided to
consumers by such institutions; and
(7) any benefits and risks of private equity ownership of
banks through the use of shelf charters and modified bidder
qualification processes.
(b) Report.--Not later than 1 year after the date of
enactment of this Act, the Comptroller of the Currency, the
Federal Deposit Insurance Corporation, and the Board of the
Governors of the Federal Reserve System shall, jointly,
submit a report to the Committee on Financial Services of the
House of Representatives and the Committee on Banking,
Housing, and Urban Affairs of the Senate containing--
(1) all findings and determinations made in carrying out
the study required under subsection (a); and
(2) an identification of statutory or regulatory barriers
to the use and effectiveness of shelf charters and modified
bidder qualification processes in the resolution of failed
insured depository institutions, including recommendations
for legislative and regulatory changes.
(c) Definitions.--In this section:
(1) Insured depository institution.--The term ``insured
depository institution'' has the meaning given the term in
section 3 of the Federal Deposit Insurance Act (12 U.S.C.
1813).
(2) Modified bidder qualification process.--The term
``modified bidder qualification process'' has the meaning
given such term in the press release of the Federal Deposit
Insurance Corporation titled ``FDIC Expands Bidder List for
Troubled Institutions Plan Allows Those Without a Bank
Charter to Participate in the Process'' published November
26, 2008.
(3) Shelf charter.--The term ``shelf charter'' has the
meaning given such term in the report issued by the
Comptroller of the Currency titled ``Activities Permissible
for National Banks and Federal Savings Associations,
Cumulative'' published October 2017.
SEC. 703. FAILING BANK ACQUISITION FAIRNESS.
(a) Concentration Limit Exceptions Only Available to Avoid
Serious Adverse Economic or Financial Effects.--
(1) Concentration limits with respect to deposits.--
(A) Federal deposit insurance act.--The Federal Deposit
Insurance Act (12 U.S.C. 1811 et seq.) is amended--
(i) in section 18(c)(13)--
(I) by amending subparagraph (B) to read as follows:
``(B) Subparagraph (A) shall not apply to an interstate
merger transaction if--
``(i) such interstate merger transaction involves 1 or more
insured depository institutions in default or in danger of
default and the responsible agency determines, based on clear
and convincing evidence, that consummation of the proposed
interstate merger transaction is necessary to prevent
significant economic disruption or significant adverse
effects on financial stability, and the Corporation has not
received any qualified bid from a company that is not subject
to the prohibition in subparagraph (A); or
``(ii) the Corporation provides assistance under section 13
to facilitate such interstate merger transaction and the
responsible agency determines, based on clear and convincing
evidence, that consummation of the proposed interstate merger
transaction is necessary to prevent significant economic
disruption or significant adverse effects on financial
stability, and the Corporation has not received any qualified
bid from a company that is not subject to the prohibition in
subparagraph (A).''; and
(II) in subparagraph (C)--
(aa) in clause (i), by striking ``and'' at the end;
(bb) in clause (ii), by striking the period at the end and
inserting a semicolon; and
(cc) by adding at the end the following:
``(iii) the term `qualified bid' means an application,
proposed application, or bid from a company where--
``(I) if applicable, the company, any affiliate insured
depository institution, and any affiliate depository
institution holding company are well capitalized and well
managed, as of the date of the application, proposed
application, or bid; and
``(II) upon consummation of the transaction, the resulting
insured depository institution is well capitalized;
``(iv) the term `well capitalized'--
``(I) with respect to an insured depository institution,
has the meaning given such term in section 38(b) (12 U.S.C.
1831o(b));
``(II) with respect to a bank holding company, has the
meaning given such term in section 2(o)(1)(B) of the Bank
Holding Company Act of 1956 (12 U.S.C. 1841(o)(1)(B));
``(III) with respect to a savings and loan holding company,
has the meaning given such term in section 238.2 of title 12,
Code of Federal Regulations; and
``(IV) with respect to a company that is not an insured
depository institution, bank holding company, or savings and
loan holding company, means maintaining equity capital that
the Corporation determines is commensurate with the capital
maintained by an insured depository institution that is well
capitalized; and
``(v) the term `well managed' has the meaning given such
term in section 2(o)(9) of the Bank Holding Company Act of
1956 (12 U.S.C. 1841(o)(9)).''; and
(ii) in section 44, by amending subsection (e) to read as
follows:
``(e) Exception for Banks in Default or in Danger of
Default.--
``(1) General exception.--The responsible agency may,
without regard to paragraph (1), (3), (4), or (5) of
subsection (b) or paragraph (2), (4), or (5) of subsection
(a), approve an application under subsection (a)(1) for
approval of a merger transaction if--
``(A) the merger transaction involves 1 or more banks in
default or in danger of default; or
``(B) the Corporation provides assistance under section
13(c) to facilitate such merger transaction.
``(2) Concentration limit exception.--The responsible
agency may, without regard to subsection (b)(2), approve an
application under subsection (a)(1) for approval of a merger
transaction if--
``(A) the merger transaction involves 1 or more banks in
default or in danger of default and the responsible agency
determines, based on clear and convincing evidence, that
consummation of the proposed interstate merger transaction is
necessary to prevent significant economic disruption or
significant adverse effects on financial stability, and the
Corporation has not received any qualified bid from another
institution that is not subject to the prohibition in
subsection (b)(2); or
``(B) the Corporation provides assistance under section
13(c) to facilitate such merger transaction and the
responsible agency determines, based on clear and convincing
evidence, that consummation of the proposed interstate merger
transaction is necessary to prevent significant economic
disruption or significant adverse effects on financial
stability, and the Corporation has not received any qualified
bid from another institution that is not subject to the
prohibition in subsection (b)(2).
``(3) Qualified bid defined.--In this subsection, the term
`qualified bid' has the meaning given that term in section
18(c)(13)(C).''.
(B) Bank holding company act of 1956.--The Bank Holding
Company Act of 1956 (12 U.S.C. 1841 et seq.) is amended--
(i) in section 3(d), by amending paragraph (5) to read as
follows:
``(5) Exception for banks in default or in danger of
default.--
``(A) General exception.--The Board may, without regard to
subparagraph (B) or (D) of
[[Page H4721]]
paragraph (1) or paragraph (3), approve an application
pursuant to paragraph (1)(A) if--
``(i) the application is for an acquisition of 1 or more
banks in default or in danger of default; or
``(ii) the application is for an acquisition with respect
to which assistance is provided under section 13(c) of the
Federal Deposit Insurance Act.
``(B) Concentration limit exception.--The Board may,
without regard to paragraph (2), approve an application
pursuant to paragraph (1)(A) if--
``(i) the application is for the acquisition of 1 or more
banks in default or in danger of default and the Board
determines, based on clear and convincing evidence, that
consummation of the proposed acquisition is necessary to
prevent significant economic disruption or significant
adverse effects on financial stability, and the Corporation
has not received any qualified bid from another institution
that is not subject to the prohibition in paragraph (2); or
``(ii) the application is for an acquisition with respect
to which assistance is provided under section 13(c) of the
Federal Deposit Insurance Act and the Board determines, based
on clear and convincing evidence, that consummation of the
proposed acquisition is necessary to prevent significant
economic disruption or significant adverse effects on
financial stability, and the Corporation has not received any
qualified bid from another institution that is not subject to
the prohibition in paragraph (2).
``(C) Qualified bid defined.--In this paragraph, the term
`qualified bid' has the meaning given that term in section
18(c)(13)(C) of the Federal Deposit Insurance Act.''; and
(ii) in section 4(i)(8), by amending subparagraph (B) to
read as follows:
``(B) Exception.--Subparagraph (A) shall not apply to an
acquisition if--
``(i) such acquisition involves an insured depository
institution in default or in danger of default and the Board
determines, based on clear and convincing evidence, that
consummation of the proposed acquisition is necessary to
prevent significant economic disruption or significant
adverse effects on financial stability, and the Corporation
has not received any qualified bid (as defined in section
18(c)(13)(C) of the Federal Deposit Insurance Act) from
another institution that is not subject to the prohibition in
paragraph (2); or
``(ii) the Federal Deposit Insurance Corporation provides
assistance under section 13 of the Federal Deposit Insurance
Act to facilitate such acquisition and the Board determines,
based on clear and convincing evidence, that consummation of
the proposed acquisition is necessary to prevent significant
economic disruption or significant adverse effects on
financial stability, and the Corporation has not received any
qualified bid (as defined in section 18(c)(13)(C) of the
Federal Deposit Insurance Act) from another institution that
is not subject to the prohibition in paragraph (2).''.
(2) Concentration limit with respect to consolidated
liabilities.--Section 14(c) of the Bank Holding Company Act
of 1956 (12 U.S.C. 1852(c)) is amended--
(A) by redesignating paragraphs (1), (2), and (3) as
subparagraphs (A), (B), and (C), respectively;
(B) by striking ``With the'' and inserting the following:
``(1) In general.--With the''; and
(C) by adding at the end the following:
``(2) Limitation.--The Board may provide written consent
for an acquisition described in paragraph (1)(A) or in
paragraph (1)(B) only if the Board determines, based on clear
and convincing evidence, that consummation of the proposed
acquisition is necessary to prevent significant economic
disruption or significant adverse effects on financial
stability, and the Corporation has not received any qualified
bid (as defined in section 18(c)(13)(C) of the Federal
Deposit Insurance Act) from another institution that is not
subject to the prohibition in subsection (b).''.
(b) Congressional Notification and Justification for
Waivers.--
(1) In general.--Whenever the Board of Governors of the
Federal Reserve System, the Comptroller of the Currency, or
the Federal Deposit Insurance Corporation waives a
concentration limit under section 18(c)(13)(B) or section
44(e) of the Federal Deposit Insurance Act or under section
3(d)(5), section 4(i)(8)(B), or section 14(c)(2) of the Bank
Holding Company Act of 1956, in connection with the
acquisition of a bank or insured depository institution in
default or in danger of default, or in connection with an
acquisition with respect to which the Federal Deposit
Insurance Corporation provides assistance under section 13 of
the Federal Deposit Insurance Act, the waiving agency and the
Federal Deposit Insurance Corporation, jointly, shall, not
later than 30 days after such waiver, submit a written report
to the Committee on Financial Services of the House of
Representatives and the Committee on Banking, Housing, and
Urban Affairs in the Senate containing--
(A) a justification for the waiver, including an analysis
of why it was necessary to prevent significant economic
disruption or significant adverse effects on financial
stability;
(B) a description of alternative bids or outcomes
considered, including efforts to solicit and encourage bids
from entities that would not require a waiver;
(C) an explanation of why alternative bids were not
selected, if applicable; and
(D) any recommendations for legislative or regulatory
changes to improve competition in future insured depository
institution resolutions.
(2) Public disclosure.--The waiving agency submitting a
report under paragraph (1) and the Federal Deposit Insurance
Corporation shall make the report publicly available on their
respective websites, subject to redactions for confidential
supervisory information and any other information described
under section 552(b) of title 5, United States Code.
(c) Limitation on Considering Bad Faith Bids in Least Cost
Determination.--Section 13(c)(4) of the Federal Deposit
Insurance Act (12 U.S.C. 1823(c)(4)), as amended by section
701(a)(3), is further amended by adding at the end the
following:
``(J) Limitation on considering bad faith bids.--In making
a determination under this paragraph of whether an exercise
of authority is the least costly to the Deposit Insurance
Fund, any application, proposed application, or bid that
would result in violation of--
``(i) section 18(c)(13) or 44(b)(2), or
``(ii) section 3(d)(2), 4(i)(8), or 14 of the Bank Holding
Company Act of 1956,
shall not be considered a possible method for meeting the
Corporation's obligation under this section for purposes of
subparagraph (A).''.
TITLE VIII--FACILITATING INNOVATION AND BANK PARTNERSHIPS
SEC. 801. MERCHANT BANKING MODERNIZATION.
(a) In General.--Section 4(k)(7)(A) of the Bank Holding
Company Act of 1956 (12 U.S.C. 1843(k)(7)(A)) is amended by
inserting ``Under such regulations, the period of time
generally permitted for holding merchant banking investments
shall not be less than 15 years. For any merchant banking
investment held on the date of enactment of the Main Street
Act, the holding period of time permitted shall not be less
than 15 years from the initial date of the investment.''
after the period at the end.
(b) Merchant Banking Study.--
(1) In general.--Not later than 1 year after the date of
enactment of this Act, the Board of Governors of the Federal
Reserve System shall carry out a study on merchant banking
investments to assess--
(A) the number, investment size, holding period, and risk
characteristics of merchant banking investments by financial
holding companies, with the assessment of investment sizes
and holding periods based on the average, median, and
distribution of the investment sizes and holding periods;
(B) the types of businesses, projects, assets, and
activities in which such merchant banking investments are
made, including the extent to which such merchant banking
investments support infrastructure projects and housing
development and construction; and
(C) any information, analyses, or findings related to
merchant banking investments that the Board determines to be
relevant.
(2) Report.--Not later than the end of the 18-month period
beginning on the date of enactment of this Act, the Board
shall issue a report to the Committee on Financial Services
of the House of Representatives and the Committee on Banking,
Housing, and Urban Affairs of the Senate containing all
findings and determinations made in carrying out the study
required under this subsection.
SEC. 802. BANK-FINTECH PARTNERSHIP ENHANCEMENT.
(a) Study on Bank-Fintech Partnerships.--
(1) Study.--The Board of Governors of the Federal Reserve
System, the Comptroller of the Currency, and the Federal
Deposit Insurance Corporation shall carry out a study of--
(A) the impact of partnerships between banking
organizations, on the one hand, and financial technology
companies, on the other hand, on the banking sector,
competition, innovation, consumer protection, and the
availability of financial products and services, including
the extent to which these partnerships support the formation
of new banking organizations, reduce time to market for
products and services, lower compliance burdens, boost
customer acquisition, improve technological capabilities, and
provide access to more diverse funding sources; and
(B) what changes to Federal laws governing banking
organizations, or to rules or guidance adopted by the Board
of Governors of the Federal Reserve System, the Comptroller
of the Currency, or the Federal Deposit Insurance
Corporation, may help promote effective partnerships between
banking organizations, on the one hand, and financial
technology companies, on the other hand.
(2) Report.--Not later than 1 year after the date of
enactment of this Act, the Board of Governors of the Federal
Reserve System, the Comptroller of the Currency, and the
Federal Deposit Insurance Corporation shall issue a report to
the Committee on Financial Services of the House of
Representatives and the Committee on Banking, Housing, and
Urban Affairs of the Senate containing all findings and
determinations made in carrying out the study required under
paragraph (1).
(3) Banking organization defined.--In this subsection, the
term ``banking organization'' means a depository institution
holding company or an insured depository institution, as such
terms are defined, respectively, under section 3 of the
Federal Deposit Insurance Act (12 U.S.C. 1813).
(b) Study on Credit Union-Fintech Partnerships.--
(1) Study.--The National Credit Union Administration shall
carry out a study of--
(A) the impact of partnerships between credit unions, on
the one hand, and financial technology companies, on the
other hand, on the credit union sector, competition,
innovation, consumer protection, and the availability of
financial products and services, including the extent to
which these partnerships support the formation of new credit
unions, reduce time to market for products and services,
lower compliance burdens, boost customer acquisition, improve
technological capabilities, and provide access to more
diverse funding sources; and
(B) what changes to Federal laws governing credit unions,
or to rules or guidance adopted by the National Credit Union
Administration,
[[Page H4722]]
may help promote effective partnerships between credit
unions, on the one hand, and financial technology companies,
on the other hand.
(2) Report.--Not later than 1 year after the date of
enactment of this Act, the National Credit Union
Administration shall issue a report to the Committee on
Financial Services of the House of Representatives and the
Committee on Banking, Housing, and Urban Affairs of the
Senate containing all findings and determinations made in
carrying out the study required under paragraph (1).
SEC. 803. DISCRETIONARY SURPLUS FUND.
(a) In General.--The dollar amount specified under section
7(a)(3)(A) of the Federal Reserve Act (12 U.S.C.
289(a)(3)(A)) is reduced by $425,000,000.
(b) Effective Date.--The amendment made by subsection (a)
shall take effect on September 1, 2036.
The SPEAKER pro tempore. The bill, as amended, shall be debatable for
1 hour, equally divided and controlled by the chair and ranking
minority member of the Committee on Financial Services, or their
respective designees.
The gentleman from Arkansas (Mr. Hill) and the gentlewoman from
California (Ms. Waters) will each control 30 minutes.
The Chair now recognizes the gentleman from Arkansas (Mr. Hill).
General Leave
Mr. HILL of Arkansas. Mr. Speaker, I ask unanimous consent that all
Members may have 5 legislative days to revise and extend their remarks
and include extraneous material on this bill.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Arkansas?
There was no objection.
Mr. HILL of Arkansas. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, I rise today in strong support of the Main Street
Capital Access Act.
As a former community bank founder and CEO in my hometown of Little
Rock, Arkansas, I have seen firsthand the important role that our
community banks and credit unions play to drive the economic engine of
America and help Main Street grow and thrive.
During the financial crisis, they were there. During the COVID
pandemic, they were there, staying up all night to close emergency
paycheck protection loans.
Every Member of this body knows this and knows it well. They have
their own story from their own town about how that local financial
institution was there for a customer, for a family, to help a startup,
to help a business or restaurant cope with the pandemic.
Community banks and hometown credit unions know their customers. They
understand the needs of their communities, and they keep capital
flowing where it is needed most.
When a family is trying to buy their first home, they often walk into
the offices of a community bank where that lender knows them,
recognizes their goals, and is invested in their success.
Mr. Speaker, as I have said on this House floor many times this year,
our banks under $10 billion make 6 out of 10 home construction loans.
When a local farmer or entrepreneur needs the capital to expand or
initiate their crop for the year, they need someone who understands
their particular business and is committed to seeing them succeed and,
thereby, their communities succeed.
I loved my role as a hometown Main Street community banker and
investor. Even to this day, almost three decades later, I smile driving
by that restaurant location that I helped grow or driving by a building
or a shopping center or a doctor's practice that our small bank helped
finance--finance its construction, finance its future, finance its home
for those employees.
Community banks make that possible, and this bipartisan Main Street
Capital Access Act gives them the tools they need to keep capital
flowing where it is needed most up and down our main streets in our
beautiful country.
For decades, Washington has made it harder for community banks to
thrive and operate efficiently. The Dodd-Frank Act, passed in the heat
and horror of the global financial crisis, took the approach that many
community and midsize banks across our Nation were faced with the same
rules and the same level of scrutiny of the largest, most systemically
important institutions. It was just too much, Mr. Speaker.
That approach, that overkill, has stifled local lending, constrained
economic growth, accelerated industry consolidation--something I hear
about from Members on both sides of the aisle all the time--and pushed
important financing activity for both families and businesses out of
the regulated financial sector. Again, I don't believe that was a goal
by the proponents of Dodd-Frank after the financial crisis.
Our local lenders, Mr. Speaker, too often now spend more time on
check-the-box compliance requirements rather than serving their
communities.
When I made my presentation to our party here in the House to chair
our Committee on Financial Services, I said that the impact of Dodd-
Frank and other rules had focused Main Street bank presidents staying
up all night worrying, not about their loan pipeline, not about where
to get their next lending officer. Instead, they are up all night
wondering how they can afford another compliance officer to try to meet
this standard that is, in my judgment, unreasonable for a small,
straightforward, local bank.
Our committee Republicans, with their great leadership from our
subcommittee chair, Andy Barr of Kentucky, have worked mightily over
the years to find a bipartisan set of solutions to exactly the problem
I outline today.
{time} 1450
Recently, the 21st Century ROAD to Housing Act, which became law,
contained nine community banking provisions that provided this sort of
thematic, clear, needed relief to America's local lenders and expanded
financing for both residential mortgages and housing construction and
development. These measures that we are debating today in the Main
Street Capital Access Act were in that same philosophy of what we just
overwhelmingly passed in both Chambers just a few days ago.
Mr. Speaker, I say today that we are building on the success of our
21st Century ROAD to Housing Act with Main Street Capital Access Act.
We are expanding access to capital, supporting American businesses, and
ensuring our financial system remains the most dynamic and diverse in
the world.
This bill delivers on those goals. It spurs formation of new banks.
It brings this commonsense tailoring back to regulation. It restores
fairness and transparency in bank supervision. It helps banks attract,
retain, and diversify important funding sources from sources of
deposits, and it removes unnecessary barriers that have limited lending
in communities across this country.
Mr. Speaker, with all of this effort, we have seen solid bipartisan
support, input, and leadership in developing this bill. Expanding
access to capital strengthens our local economies. It gives
entrepreneurs the confidence to invest, businesses the ability to grow,
and families the opportunity to build long-term wealth through that
most abundant of American dreams: owning their own home.
When Main Street banks succeed, our communities thrive. I thank my
colleague again, my friend, the chairman of our Subcommittee on
Financial Institutions, the gentleman from Kentucky (Mr. Barr), for his
tireless efforts in developing this bill and his commitment to
strengthening community banking, not only in Kentucky but across our
Nation.
Mr. Speaker, I also thank his hardworking colleague who has spent
hours tirelessly thinking through the best approach to these
provisions, and that is the gentleman from Illinois (Mr. Foster) of
Chicago.
Their collaboration will benefit our country, and I hope that we see
a strong, bipartisan vote on this bill in this Chamber today.
Mr. Speaker, I urge my colleagues to support this bill, and I reserve
the balance of my time.
Ms. WATERS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, let me start by saying that we all care about community
banks and credit unions.
For that reason, I was pleased to work with Chair Hill on a package
of community bank provisions included in our landmark housing bill, the
21st Century ROAD to Housing Act.
Now, even though Trump refused to sign it, that legislation has
become the law of the land. That law not only will get America back in
the business of
[[Page H4723]]
building housing, but it will help community lenders provide mortgages
and other types of financing to support the American Dream of
homeownership.
Importantly, that bill did not have handouts. It did not have
handouts for megabanks, Big Tech, payday lenders, debt collectors, or
credit bureaus. That is not the case for the bill that is before us
today.
H.R. 6955 is Wall Street deregulation--that is what it is--hiding as
a community bank bill. This package is made up of 24 Republican bills
with just two Democratic bills.
Today, we mark the 16th anniversary of the Dodd-Frank Wall Street
Reform and Consumer Protection Act being signed into law. That is the
law that bears the name of the late great and former Chairman Barney
Frank. Unlike President Trump, President Obama knew when to sign a good
bill when he saw it.
That law was passed in response to the 2008 financial crisis when, in
case my Republican colleagues have forgotten, millions of Americans
lost their jobs, their homes, and their life savings.
Yet, H.R. 6955 ignores these lessons and rolls back a long list of
safeguards and oversight of the largest banks. Importantly, the Nation
is grappling with an affordability crisis and surge in financial scams
and fraud, costing consumers tens of billions of dollars. This was all
made worse when Trump shut down the Consumer Financial Protection
Bureau.
Voting for H.R. 6955 would add insult to injury by thwarting a future
CFPB from issuing rules, such as fixing credit reporting or reining in
debt collectors or abusive medical debt practices. Maybe that is the
point.
Interestingly, Rules Committee Chairwoman Foxx said the quiet part
out loud yesterday. She confessed that Republicans love deregulation.
That is what this bill is all about. It is not affordability and not
protecting consumers. It is about deregulation for Wall Street's
megabanks.
Mr. Speaker, what is more is that this bill ignores lessons from the
failures of Silicon Valley Bank and other regional banks just 3 years
ago. Those large regional banks failed after Congress rolled back
capital, liquidity, and other rules specifically for those banks.
Nevertheless, this bill allows even more of these large banks to
escape critical safeguards, which risks even more failures and harm to
Americans and small businesses.
If H.R. 6955 were to become law, it would be the most sweeping
deregulation of Wall Street since the 2008 financial crisis.
Two sections of the bill, sections 203 and 204, amend 15 different
banking and consumer protection laws and would increase more than 40
different regulatory thresholds. There are so many laws being rolled
back. The committee report for this bill is over 600 pages long, mostly
to show how all these different laws are amended.
In fact, the sponsors of this bill were so zealous to raise
thresholds that they increased two thresholds that will aid bad actors
who commit fraud against a bank or a large financial institution.
You can't make this up. There is a provision that will increase the
amount that individuals can defraud a bank or future AIG by and then
get government money to buy those failed assets for their own benefit.
The largest labor union in the U.S., the AFL-CIO, and consumer
advocates like Americans for Financial Reform and others wrote a letter
saying that taken together, these changes would be more damaging than
the sum of their parts, leaving the financial system dramatically
weaker and more vulnerable to instability and crisis.
Now, Republicans made some technical changes at the request of Trump
regulators, but let me give you another example of what they didn't
fix.
Wells Fargo, which many of you may remember created millions of fake
consumer accounts and has been the subject of countless enforcement
actions for consumer harm, like discrimination and anti-money-
laundering deficiency, would have a new tool to delay future
enforcement actions when consumers have been harmed.
Mr. Speaker, instead of letting Wall Street put Americans and our
economy at risk again, we should be addressing the affordability crisis
caused by Trump's failed economic policies and endless war with Iran.
Mr. Speaker, I urge Members to oppose this bill, and I reserve the
balance of my time.
{time} 1500
Mr. HILL of Arkansas. Mr. Speaker, our next speaker has worked
tirelessly to assemble this package of bills that will help our Main
Street banks and credit unions thrive, grow, better serve their
customers, and, in turn, be able to see their local economies benefit.
Mr. Speaker, I yield 5 minutes to the gentleman from Kentucky (Mr.
Barr), the chairman of the Subcommittee on Financial Institutions.
Mr. BARR. Mr. Speaker, I want to start by applauding my good friend
from Arkansas, Chairman French Hill, for his leadership on this
critical legislation. Great job working across the aisle for bipartisan
support for this legislation that will help strengthen Main Street
America.
The Main Street Capital Access Act is exactly the kind of reform
needed to advance this committee's goal of making community banking
great again. Over the past 18 months, we have worked hard to develop
over two dozen banking reform bills--many of them with strong
bipartisan support--and combined them into one multifaceted package
designed to strengthen our community financial institutions, not big
banks, like the ranking member is referring to, community banks, Main
Street banks, midsize banks.
If we want to help hold big banks accountable, then what we need is
competition. Competition and choice are good for America, good for
consumers, and good for financial stability.
Mr. Speaker, I include in the Record a link to 14 letters of support
from the Consumer Bankers Association, the American Bankers
Association, the Bank Policy Institute, the Independent Community
Bankers of America, the National Association of Home Builders, and
others: https://acrobat.adobe.com/id/urn:aaid:sc:US:4c869bbb-74d2-4d1e-
befb-1b3aba1a0be3
Community banks and credit unions are the financial backbone of this
country. They finance farms, factories, first-time home buyers, and the
local entrepreneurs who create jobs in every corner of America. These
institutions don't just serve communities. They are part of the
community.
Here is the hard truth: Community banks have suffered under a
regulatory framework that forgot who the system should serve. For too
long, Washington has been writing rules as if every bank and credit
union in America is a trillion-dollar global institution. They are not.
They are our hometown banks and community financial institutions.
These guardrails that the ranking member talks about rolling back, we
are not rolling back guardrails for big, multitrillion-dollar banks. We
are talking about small community financial institutions.
The goal is simple: Regulation should follow the risk, not the ZIP
Code or the political fashion. A $500 million community bank in rural
Kentucky, rural Arkansas, or rural Michigan should not be regulated
under the same framework built for a trillion-dollar institution
operating around the globe. That means higher costs, fewer loans, more
forced consolidation. This hurts everyday Americans by reducing both
access to credit and opportunities for small business growth.
The Main Street Capital Access Act is about changing that. It is
about rightsizing this regulatory framework to ensure that community
lenders get back to what they do best: serving their customers and
their communities.
Main Street opens the door for new bank formation, improving
transparency in the chartering process, making applications more
predictable, and ensuring rural and underserved communities can once
again see new institutions formed instead of watching their local banks
disappear.
You want to hold big banks accountable? Allow new banks to form.
It also restores proportionality to regulation, updating capital
leverage and enhanced prudential standards to actually reflect a bank's
risk profile, not just an arbitrary static asset threshold. That means
less money spent on regulatory gymnastics and more money available for
loans in your communities.
We are also bringing fairness and due process back to the supervision
process. Banks and credit unions should not
[[Page H4724]]
be governed by opaque examiner preferences. They should be governed by
clear risk-based and transparent standards that focus on core financial
performance rather than foot faults and check-the-box compliance.
Main Street also addresses the structural problems that are driving
consolidation. This legislation requires regulators to ensure clarity
and predictability in the merger process so that healthy banks can grow
and troubled banks can find partners before they fail. It ensures that
when banks do fail, like Silicon Valley Bank, community banks aren't
shut out of the resolution process by design.
Finally, this legislation recognizes reality: Innovation is
happening. The question is whether it happens inside the banking
system, where it is supervised and safe, or outside, where it isn't.
This bill lets banks partner, modernize, and compete.
Community banks, Mr. Speaker, are the financial infrastructure of
America--rural America, suburban America, urban America. When they
thrive, small towns thrive. When they are regulated out of existence,
capital dries up and opportunity for local ownership disappears.
The Main Street Capital Access Act is a critical step toward
restoring the financial backbone of this country.
Mr. Speaker, I urge all my colleagues to support this legislation.
Ms. WATERS. Mr. Speaker, I yield 2 minutes to the gentlewoman from
New York (Ms. Velazquez), the ranking member of the Committee on Small
Business.
Ms. VELAZQUEZ. Mr. Speaker, I rise in opposition to H.R. 6955.
Community banks and credit unions are the foundations of our
financial system. As ranking member of the House Small Business
Committee, I understand better than most the role they play in our
communities, offering small business loans, farm loans, and mortgages.
They are critical lifelines to our rural and underserved communities
that have been left behind by our biggest banks.
While I believe in sensible tailoring to help community banks and
credit unions do what they do best--deliver personalized products to
meet the needs of their customers--this bill moves far beyond sensible
tailoring.
Instead of focusing on modest improvements, this package represents
the largest amount of bank deregulation since before the financial
crisis. It includes sweeping reforms that will not only significantly
roll back necessary safeguards and weaken oversight, but it will also
undermine consumer protection and antidiscrimination measures and
hamper the CFPB's ability to issue new rules. This deregulation package
will push risk into the shadows and make the next publicly financed
bailout more likely.
This is especially concerning at a time when financial regulatory
agencies are under political attack, pursuing industry-friendly
agendas, and are starved of resources. That is why more than 25 labor,
consumer, housing, economic justice, and public interest organizations
are opposing this bill.
The SPEAKER pro tempore. The time of the gentlewoman has expired.
Ms. WATERS. Mr. Speaker, I yield an additional 30 seconds to the
gentlewoman from New York.
Ms. VELAZQUEZ. Mr. Speaker, I urge my colleagues to vote ``no'' on
this bill.
Mr. HILL of Arkansas. Mr. Speaker, our next speaker has worked in
this House for over a decade, speaking on behalf of Main Street
Michigan. From that real estate community, from his own background, his
own business entrepreneurship and that of his family, he knows the
value of how our local financial institutions help grow an economy and
have more opportunities.
Mr. Speaker, I yield 2 minutes to the gentleman from Michigan (Mr.
Huizenga), the vice chairman of the House Committee on Financial
Services.
Mr. HUIZENGA. Mr. Speaker, as a small business owner, I have seen it.
I have lived it. When community banks disappear, families and small
businesses lose the local lenders who know their communities and their
customers best. Less competition means fewer financing options, higher
borrowing costs, and less investment on Main Street, not Wall Street,
as some of my colleagues are trying to assert.
This bill lowers unnecessary regulatory costs for community and
midsize banks, not those big business center banks on Wall Street and
in New York and around the world. In fact, this ends debanking. Mr.
Speaker, it restores the flexibility these institutions need to better
serve you and your family.
{time} 1510
I am also pleased that this bill includes two of my bills: the FDIC
Board Accountability Act, which strengthens governance of the FDIC
board on behalf of smaller institutions, and the Enhancing Bank
Resolution Participation Act, which simply seeks to bring more
qualified bidders into failed-bank resolutions when disaster strikes.
Better oversight and broader participation can protect depositors. It
is going to promote competition. It reduces further concentration in
the banking system, and I would think, Mr. Speaker, we would want that.
However, it appears that some on the other side do not.
This package makes it easier to form new banks, strengthens local
funding and liquidity, and helps community lenders put more deposits to
work financing homes, small businesses, and entrepreneurial dreams.
At a time when Americans are struggling with everyday expenses,
Washington should not make credit more expensive through needless red
tape.
H.R. 6955, the Main Street Act, will promote competition. It will
expand access to capital and help make life more affordable for
American families.
I thank the chairman both of the full committee as well as our
subcommittee, and I urge passage.
Ms. WATERS. Mr. Speaker, I yield myself such time as I may consume.
Let me be clear: Dodd-Frank has not led to bank consolidation. That
trend began when Congress repealed Glass-Steagall almost 30 years ago.
What Dodd-Frank has done is ensure the longest stretch of economic
growth in a generation. The threat to community banks is not Dodd-
Frank, but it is to repeal it and return to their needless days,
reckless days that led to the 2008 financial crisis.
Just last week, we passed my bill as part of the 21st Century ROAD to
Housing Act. My bill eased the requirements on new banks. H.R. 6955,
however, would set new banks up for failure. In fact, the bill
undermines much of what we were trying to accomplish when we worked
together in a bipartisan way.
What we have to do at this point in time is understand a provision of
the housing bill that was carefully negotiated. Mr. Speaker, I thought
we all were supposed to be in support of the housing bill. Everybody
raved about the greatness of it. Now, 10 days after it became law, now
some on the opposite side of the aisle are already trying to undo the
bill.
Now, this bill will actually make it easier for more, not less
consolidation. The bill is bad for new banks but great for megabanks.
Let me just say this: We all talk about loving community banks. I
want you to know it is not the talk about loving community banks, it is
action and what we do for or against them. I want you to know the big
megabanks don't even want them in their doors. They don't even want to
have those working behind the counter serving us. They have you serving
from outside the bank.
When you can get in touch with them, I want you to know, you have got
to go through a hell of a menu to try to talk with someone that maybe
in a community bank you can talk to.
Do you know why we love community banks? It is because they
understand the community. They know the people in the community. They
work with you when you have a problem.
The megabanks don't know you, don't care about you, don't do anything
to assist you, and hope you can't get through their menus in order to
speak with anybody.
I say, it is not a lot of talk about loving community banks. It is
action and what you do.
Now, then you come in here talking about how much you love the
community banks, yet you know that you can't get the deregulation that
you are doing unless you hid behind the community banks. If you love
the community banks, all you have got to do is work with us to separate
the regulations in a way that it does not undermine the community
banks.
[[Page H4725]]
If you want to be fair, charge all your big friends and all the big
banks everything they should be charged with regulation.
This is about whether or not you are going to use your power to
literally undo what we have worked so hard to do to give the average
person a decent chance with a bank, and that is community banks.
Mr. Speaker, I am asking for a ``no'' vote on this bill because, in
the final analysis, I know that if you get away with these
deregulations, we are going to have consolidation. It will only be five
banks, almost only five big banks in the country that control
everything. I am asking for a ``no'' vote, and I reserve the balance of
my time.
Mr. HILL of Arkansas. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, let me address that comment that the ranking member has
articulated, which is that somehow this bill reduces the power of
community banks to compete with the big, globally systemic banks that
she described.
I would really argue just the contrast. This bill tailors the
regulatory compliance so that a bank with a straightforward, simple
business plan that is well managed, that is well capitalized can have a
lower tailored compliance cost compared to the one-size-fits-all
approach that was a part of Dodd-Frank aimed at those big, Wall Street
globally systemic banks.
Secondly, if you don't want them to grow, then you want community
banks to have access to more capital. That is offered in this bill. You
want them to be more successful. That is offered in this bill.
You want them to be able to buy a failing bank on their own or with
partners to compete with the biggest banks in the country who are just
simply given banks that need resolution at the FDIC. If a small bank
fails in some State, they just let the big banks bid on them.
This bill creates competition. Chairman Barr walked through that.
This actually increases the chance for entrepreneurs to acquire,
unfortunately at the demise of a local bank, so that it is not sold to
some big Wall Street lender.
I could go on with all the benefits of this bill that is tailored and
focused on the growth and success of our Main Street institutions, but
I can think of no better person to help me make that case than the next
speaker.
Mr. Speaker, I yield 2 minutes to the gentleman from Georgia (Mr.
Loudermilk), the vice chairman of our Financial Institutions
Subcommittee.
Mr. LOUDERMILK. Mr. Speaker, I thank the chairman of the Committee
for his hard work on this and for including several of my provisions in
this bill that is designed for the small guy.
I obviously rise in support of H.R. 6955 not only because it is a
good bill, but also because I recognize the need to rightsize Federal
regulations and gain more transparency into the financial regulatory
process.
For too long, Federal financial regulators have taken this one-size-
fits-all approach. If we applied that same status to ourselves, then
let's just issue every Member of Congress one suit of clothes so that
we all wear the same suit of clothes. Now, we wouldn't accept that
because we would only have clothes to fit the largest Member of
Congress.
What we are saying is that is what we have in the financial services
industry right now. We need to tailor the regulations to fit the
business model of the business, especially the small business. That is
why I am proud that my TAILOR Act has been included in this package.
I can't stress enough the importance of the TAILOR Act because it is
for the little guy. It is important because it requires all future
regulations to be tailored to the risk of the regulated institution. It
rewards institutions that adopt sound risk management practices with
fewer regulations and punishes those who take an unhealthy amount of
risk.
I also wish to highlight my New BANK Act, which requires Federal
financial regulators to publish annual reports on applications received
for creating new financial institutions. These reports will help give
critical insights to the current de novo chartering process and how
Congress can reduce complexities and redundancies in the system.
To conclude, Mr. Speaker, I believe this legislative package with my
bills included is much more aligned with the goal of a safe and sound
financial system that works for all the American people, and I urge my
colleagues to support this bill.
{time} 1520
Ms. WATERS. Mr. Speaker, I yield 2 minutes to the gentlewoman from
Texas (Ms. Garcia), who is a big supporter of community banks.
Ms. GARCIA of Texas. Mr. Speaker, I rise against H.R. 6955. Instead
of the Main Street Act, this bill, Mr. Speaker, should be called the
Wall Street wins Main Street loses act.
It does not help end the affordability crisis, feed hardworking
Americans, or keep a roof over their heads. Instead, this bill sneaks
in deregulatory measures, further weakens the Consumer Financial
Protection Bureau, and weakens community reinvestment and anti-
discrimination safeguards.
For this reason, at the appropriate time, I will offer a motion to
recommit this bill back to committee.
If the House rules had permitted it, I would have offered the motion
with an important amendment to this bill. My amendment would limit the
provisions of this bill from applying to any globally systemically
important bank holding companies. Simply put, it ensures that the
bill's deregulatory provisions do not apply to megabanks.
Mr. Speaker, I ask unanimous consent to insert the text of my
amendment into the Record immediately prior to the motion to recommit.
The SPEAKER pro tempore. Is there objection to the request of the
gentlewoman from Texas?
There was no objection.
Ms. GARCIA of Texas. Mr. Speaker, I hope my colleagues will join me
in voting for the motion to recommit. Let's send this back to Committee
so that we can make sure that it truly works for our community banks
and that it does not give Wall Street another big win.
Mr. HILL of Arkansas. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, I thank Mr. Loudermilk who spoke a moment ago. The vice
chairman of our Subcommittee on Financial Institutions made a very good
point also about how this bill strengthens competition.
Chairman Andy Barr of Kentucky, Ranking Member Waters of
California, and Mr. Loudermilk all mentioned the importance of
encouraging de novo banks, meaning start-up banks, particularly in our
fast-growing communities that have seen disproportionate business and
population growth, like south Florida or other places across the
Nation.
All three of those Members have something in common, which is they
support greater de novo provisions. We had Ms. Waters in the housing
bill, and we have two in this bill that encourage start-up banks and
encourage the regulators to work and have a better strategy for start-
up financial institutions because that means that they can meet the
growth.
What does that do, Mr. Speaker?
It increases competition for the biggest companies because they are
close to customers, they have a business strategy, and they are unique
to the marketplace. That is another example of how this bill is, in
fact, counter to the assertion that it is only geared towards Wall
Street institutions.
Mr. Speaker, I yield 2 minutes to the gentleman from Pennsylvania
(Mr. Meuser), who understands finance from both the point of view of
one of our biggest and most industrial States, Pennsylvania, having
been a statewide officer as well as a highly successful manufacturer
and entrepreneur. Mr. Meuser is the chair of our Oversight and
Investigations Subcommittee.
Mr. MEUSER. Mr. Speaker, I commend our chairman, French Hill, for his
excellent leadership.
I do rise in support of the very appropriately named Main Street
Capital Access Act introduced by Chairman Hill and Subcommittee
Chairman Barr. The legislation does exactly what it says. It supports
access to capital for Main Street.
At the start of this Congress, Chairman Hill said one of our
Committee's priorities was to make community banking great again. Since
then, we
[[Page H4726]]
have advanced the package of bills before us that is the largest
community bank deregulatory reform effort since the 1990s.
Mr. Speaker, 20 years ago, community banks financed 65 percent of
home loans in this country. Today, it is less than 30 percent. This
bill helps reverse that trend. It lowers capital hurdles so new
community banks can form, and it tailors bank regulations so small and
midsize banks are regulated fairly.
These changes allow banks to extend more mortgages, be more
competitive on small business loans, and improve access to credit for
all Americans. This is a housing bill, a small business bill, an
affordability bill, and an access to capital bill.
Importantly, the bill also includes legislation to codify President
Trump's executive order preventing debanking, such as my bill, the SAFE
Guidance Act, which affirms guidance does not have the effect of law.
Both guidance and reputational risk were weaponized under previous
administrations to debank legitimate, legal businesses.
This bill corrects those wrongs. This legislation supports community
banks, protects Main Street across the country, and I urge support.
Ms. WATERS. Mr. Speaker, may I inquire how much time for each side is
remaining.
The SPEAKER pro tempore. The gentlewoman from California has 15
minutes remaining. The gentleman from Arkansas has 8\1/2\ minutes
remaining.
Ms. WATERS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I will mention again one of the atrocities that I have
been able to experience working on these issues.
Again, Wells Fargo was fined $3.7 billion just a few years ago for
widespread mismanagement of automobile loans and mortgages. Their
actions included unlawful fees and even repossession of cars.
Now, someone would say, $3.7 billion, well, I want you to know they
make so much money that is just a cost of doing business. They will
keep doing it if we keep allowing them to get away with what they are
trying to get away with today.
If my friend wants a guarantee that this bill helps Wells Fargo, then
he should support Ms. Garcia's amendment that says that megabanks can't
benefit from this bill, but I guess he won't.
After all, my friend knows that today is Dodd-Frank's birthday, and
he is the skunk at the party. There is so much that we could point out
that the average citizen knows in dealing with their banks. The average
citizen is tired of being treated in the way that they are treated by
their banks.
I tell my friend that he is correct in the support that he did for
the big bill that Mr. Hill and I worked so hard on. We have a lot in
that bill.
But let me point out one of the things in that bill that gives us
cause to be concerned. Right now, Mr. Speaker, if you find a residence
that you would like to buy, particularly if you are in a rural
community, or you may be a low-income community, but you work every day
and you can afford a house for maybe $90,000 to $100,000, the bank
doesn't want to be bothered with you. The bank wants the big loans. The
bank wants the million-dollar loans. They want the half-billion-dollar
mortgages. They don't want the small mortgages.
Guess what, Mr. Speaker. They don't do them.
As a matter of fact, many communities where there are residents who
could afford the houses in their community are sold out to private
equity firms and others who come and buy these houses for pennies on
the dollar, but they won't sell them to you, Mr. Speaker, because you
don't look like a big profitmaker for them.
I am so pleased I worked with Mr. Hill, and we have done something to
change that to encourage the banks to pay attention to those who can
afford that $90,000 house, that $100,000 house, that $150,000 house,
that $200,000 house. They are working every day. They can afford it,
but the banks are not interested.
My friend tells me that we should not be concerned about deregulation
that puts these banks in a position where they are not only moving
toward consolidation, but they are taking over banking in ways that
will help them to get richer and richer.
Guess what, Mr. Speaker. They will keep paying the fines, the big
banks will, because that is the cost of doing business, and they still
make money. This is outrageous. This is ridiculous.
No more deregulation. No more looking at how you can frame it in such
a way, Mr. Speaker, that you are saving the community banks. Mr.
Speaker, you are not saving the community banks. As a matter of fact,
you are putting them out of business.
Mr. Speaker, I reserve the balance of my time.
Mr. HILL of Arkansas. Mr. Speaker, I yield 1 minute to the gentleman
from the beautiful territory of Guam (Mr. Moylan). He has a strong
background in financial services, healthcare, business, and insurance.
Mr. MOYLAN. Mr. Speaker, I rise today in support of H.R. 6955, the
Main Street Capital Access Act.
When the people of Guam set out to enterprise new business ventures,
we turn to our community banks to raise capital. However, much of
America's financial system is not designed with small businesses in
mind. While big banks have the resources to cut through red tape, small
community ventures often struggle to comply with a regulatory regime
that never had them in mind.
The Main Street Capital Access Act makes commonsense reform,
tailoring regulations so small lenders can comply, while opening more
resources to the new banks, small banks, and rural banks which serve
communities like Guam. This bill will give the Guam business community
a fair chance, and I thank the Financial Services Committee for their
work on this legislation.
{time} 1530
Ms. WATERS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, proponents say this bill is just for community banks,
but here we have another example of the Big Banks sneaking in their
rollbacks.
I have four postings from the Bank Policy Institute, which represents
all of the largest banks, like Wells Fargo. These postings advocate for
indexing regulatory thresholds to nominal GDP instead of inflation.
Why? It allows more and more banks to escape regulatory scrutiny.
This bill will give Trump's regulators--and only Trump's regulators--
the opportunity to index 40 different thresholds to let large banks off
the hook. Wall Street is making record profits while they are helping
them.
Mr. Speaker, for those of us who really care about community banks,
we want to keep them because they service their communities in a more
profound way. Again, I will repeat: They know and understand when you
have a problem, you can call a big bank and you will find nobody. You
will go through different menus that they have, but you will not be
able to walk into the bank and talk to somebody sitting at a desk who
will help you with your problem. Do I have to say more?
Mr. Speaker, I reserve the balance of my time.
Mr. HILL of Arkansas. Mr. Speaker, I yield 2 minutes to the gentleman
from North Carolina (Mr. Knott).
Mr. KNOTT. Mr. Speaker, I rise today in strong support of H.R. 6955,
the Main Street Capital Access Act.
For the vast majority of our Nation's history, community banks were
the primary artery into progress for all Americans. That reality is
being threatened today by sloppy and ineffective policies that
originate right here in Washington, D.C.
Whether it is the Dodd-Frank regulatory structure or the millions of
rules and regulations that are in existence today, community banks have
been choked out by these all-encompassing regulations.
With administrative costs rising every year, local banks simply
cannot afford to operate. We can see this most clearly in 1980 where
there were more than 14,000 community banks in the United States. Now
because of the regulatory structure of the current market, there are
roughly 4,000 community banks. This stifles lending, reduces
competition, and makes it harder for Americans, especially in rural
communities, to access capital. Put plainly, the current regulatory
climate punishes community banks, and it benefits larger international
banks.
[[Page H4727]]
My home State of North Carolina has long had a proud history of
vibrant community banks. Today, there are very few exceptions to this,
but there are really only two choices for community banks in today's
market if they want to survive. That is to grow large enough to be
acquired or to merge with another institution. Whether it was Wachovia,
First Citizens, BB&T, or Bank of America, each of these began in North
Carolina as a local community bank before growing and becoming a key
player in our economy through a merge or an acquisition.
It is time to restore a market that welcomes and protects community
banks, a market that encourages competition, and most importantly, one
that serves the American citizen. H.R. 6955 does just that.
Mr. Speaker, I thank Chairman Hill for his important work on this
legislation, and I strongly urge my colleagues to support this bill
today.
Ms. WATERS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, a wide variety of labor, consumer, and civil rights
groups are strongly opposed to this bill. Let me read from one of the
letters we received: ``The National Community Reinvestment Coalition
(NCRC) and our network of 700+ community organizations urge Members to
oppose H.R. 6955, the Main Street Capital Access Act and vote no on the
House floor.''
That is what we are being urged to do by our supporters.
``H.R. 6955 is a broad bank deregulation package that would weaken
fair lending transparency, community accountability, bank supervision,
and merger review. The bill would reduce the tools regulators and
communities rely on to detect redlining, monitor access to credit,
evaluate bank mergers, prevent harmful consolidation, and hold
financial institutions accountable to the people they serve.''
The signers of the letters don't just come from blue States but from
all over the United States of America. This includes Build WyCo from
the great State of Kansas. We also have Building Neighborhoods Together
in Pennsylvania, Fair Housing Center of Northern Alabama, and Freedom
Equity in Ohio. More signers include Georgia Advancing Communities
Together, the Neighborhood Recovery Community Development Corporation
in Texas, and the United States Broadway Corporation in New Mexico.
I could go on and on, but there is no time for that.
Mr. Speaker, I include in the Record the letter from NCRC.
National Community Reinvestment Coalition
July 21, 2026.
Re Oppose H.R. 6955, the Main Street Capital Access Act.
Hon. Hakeem Jeffries,
Democratic Leader, House of Representatives,
Washington, DC.
Hon. Katherine Clark,
Democratic Whip, House of Representatives,
Washington, DC.
Hon. Pete Aguilar,
Chair, House Democratic Caucus, House of Representatives,
Washington, DC.
Dear Leader Jeffries, Whip Clark, Chair Aguilar, and
Members of Democratic Leadership: The National Community
Reinvestment Coalition (NCRC) and our network of 700+
community organizations urge Members to oppose H.R. 6955, the
Main Street Capital Access Act and vote no on the House
floor.
H.R. 6955 is a broad bank deregulation package that would
weaken fair lending transparency, community accountability,
bank supervision and merger review. The bill would reduce the
tools regulators and communities rely on to detect redlining,
monitor access to credit, evaluate bank mergers, prevent
harmful consolidation and hold financial institutions
accountable to the people they serve.
NCRC appreciates the inclusion of CDFI-related provisions,
including CDFI Fund transparency and CDFI Bond Guarantee
Program improvements. However, those revisions do not fix the
bill's core problem: H.R. 6955 moves federal banking policy
in the wrong direction by weakening community accountability,
fair-lending transparency, merger review and supervisory
safeguards.
Earlier this year, NCRC urged a no vote when H.R. 6955 was
considered in committee. All Democratic members who were
present voted no in Committee: We urge you to continue that
opposition and vote no on the House floor.
1. H.R. 6955 would sharply limit monopoly and competition
review for mergers involving roughly 96 percent of all
banks.
Section 601 would prohibit federal banking regulators when
evaluating many mergers resulting in institutions below $10
billion in assets from engaging in a competition review and
thus they cannot consider whether the mergers would create
monopolies or substantially lessen competition. The latest
floor version preserves competition review where a
transaction would leave only one insured depository
institution with a physical presence in the area. This narrow
exception does not solve the problem and protects only
against the most extreme case, while preventing regulators
from reviewing many mergers that could still substantially
reduce competition, reduce branch access, or weaken small-
business, agricultural and consumer credit options in local
markets.
Because roughly 4,129 of the nation's 4,287 insured banks
(or approximately 96 percent) hold under $10 billion in
assets, this carveout would cover a large share of community
and regional bank merger activity. The problem is especially
acute in rural counties and smaller local markets. A merger
between two banks that are not nationally large can still
have significant local consequences. In many communities, the
loss of one local institution can mean fewer branches,
reduced small-business lending, less agricultural credit,
weaker customer service, and fewer banking choices.
NCRC conducted an analysis of every US county to assess the
impact of potential mergers between the two largest banks in
each county, with their combined assets being under $10
billion. NCRC found that 641 counties, predominantly rural,
would shift from competitive markets to highly concentrated
markets. In ten counties, one bank would control 100 percent
of all local deposits. According to the FDIC's Merger
Decisions Annual Report to Congress (2024), regulators
approved 61 regular bank-merger applications in 2023. Of
those, 57 out of the 61 would have resulted in institutions
less than $10 billion. Under H.R. 6955, many comparable
transactions would fall within the bill's competition-review
safe harbor, unless the narrow one-physical-depository-
institution MSA exception applied.
2. H.R. 6955 would weaken CRA, HMDA and fair lending
accountability
Section 204 would substantially reduce the tools
communities rely on to ensure fair access to credit and hold
banks accountable to local needs. The floor version no longer
uses the same mechanics as the committee-reported bill, but
the core concern remains: Section 204 would create an
automatic increase for statutory thresholds across consumer
and community-focused laws, including the Community
Reinvestment Act and the Home Mortgage Disclosure Act.
Beginning in 2031 and every five years after that, Section
204 would require the Federal Reserve to raise the dollar
cutoffs in laws like CRA and HMDA that determine which banks
are subject to stronger reporting, examination and
accountability rules. The Fed would decide whether to base
those increases on nominal GDP or inflation.
That is the wrong test for community accountability.
Nominal GDP measures the size of the overall economy, while
CPI measures inflation. Neither one measures whether banks
are serving communities fairly, the rates of redlining, the
extent of market concentration, have sufficient data to
detect discrimination, and whether credit needs in LMI
communities are being met. A larger economy does not mean
community needs are being met.
The same problem applies to inflation indexing. Adjusting
thresholds for CPI may sound technical or even routine, but
in this context, this approach would still cause fair-lending
transparency to shrink automatically over time without any
finding that communities are being served fairly.
For NCRC and our members, the HMDA and CRA implications are
especially serious. HMDA data is one of the primary tools
used to detect redlining, evaluate whether lenders are
serving borrowers and neighborhoods fairly, and identify gaps
in mortgage access. CRA examinations are one of the few
mechanisms that require banks to demonstrate that they are
meeting the credit needs of their entire communities,
including low- and moderate-income neighborhoods.
3. H.R. 6955 would compress merger review and sideline
community evidence
Section 604 would set a fixed 120-day clock for certain
applications, beginning at the time of filing even if the
submission is incomplete. If the Federal Reserve fails to act
within that period, the application would be deemed granted.
That is a dangerous standard for complex bank transactions.
Merger review should focus on whether a transaction will
serve the convenience and needs of affected communities,
preserve access to banking services, protect consumers and
avoid harmful concentration. It should not be driven by an
artificial clock that rewards incomplete applications and
pressures regulators to approve deals quickly.
Section 604 would also restrict how regulators treat
information from outside parties when determining whether an
application is complete, potentially discounting community
and consumer evidence that is often essential to
understanding a transaction's
[[Page H4728]]
real-world impact. Community groups, local officials, small
businesses and affected residents are often able to identify
branch closure risks, fair lending concerns, weak CRA
performance or service gaps that are not evident from the
applicant's own submission.
4. H.R. 6955 focuses on how long merger approval takes,
instead of whether mergers benefit local economies.
Section 603 directs the Inspector General of each Federal
depository institution regulatory agency to conduct a study
every three years on the ``timeliness and efficiency'' of
merger approvals, including number of days it takes to
process merger applications and the identification of
``sources of delay.'' Merger applications warrant scrutiny to
evaluate their effect on each of the statutorily required
factors of review, including how a proposed combination will
serve the convenience and needs of the affected communities.
Studies show signs of decreased small business lending after
mergers, as well as lower rates paid to customers for
deposits. However, despite this evidence, practically all
merger applications are currently approved. Local economic
needs would be much better served by directing the agencies
to study the actual impacts of mergers and bank
consolidation, instead of counting days to pressure
regulators to make decisions faster.
Furthermore, concerns about the timeliness of merger
reviews appear to be unfounded. NCRC analyzed the approval
times of 18 merger applications submitted to the OCC in 2024.
As shown in the table below, we found that the median days
for approval after receipt of an application was 60 days, and
that the average was 84 days. In other words, about half of
these applications were approved 30 days after the end of a
30-day public comment period.
5. H.R. 6955 would pressure regulators to ignore reputational
risk
Section 304 would pressure federal banking agencies to
remove reputational risk from supervision. This provision is
framed as preventing regulators from using vague concepts to
pressure banks, but the practical effect would be to create
blind spots.
Reputational risk is not simply ``bad press.'' It can be a
warning sign of deeper institutional failures: predatory
lending, discriminatory treatment, abusive fees, money
laundering, fraud, weak compliance systems or repeated
consumer complaints. Regulators should not be forced to
ignore patterns of harm merely because those patterns also
damage a bank's reputation.
Communities often experience these harms before they show
up as capital problems. If regulators are barred from
considering reputational risk, they may lose an important
early-warning tool for identifying conduct that threatens
consumers, communities and the institution itself.
Congress should reject H.R. 6955
The bill's supporters argue that H.R. 6955 will help local
banks. What the bill actually does is weaken fair lending
transparency, reduce CRA and HMDA accountability, make bank
mergers easier, limit meaningful community input, and make
supervision more difficult.
NCRC is especially concerned that fair lending, CRA, HMDA
and consumer protection requirements are recast as regulatory
burdens rather than public accountability tools. These laws
exist because markets have not reliably served all
communities fairly. They help identify discrimination, credit
gaps, support enforcement, and ensure that banks receiving
public benefits meet public obligations.
For these reasons, we urge Members to oppose H.R. 6955 and
vote ``no'' on final passage.
Sincerely,
Jesse Van Tol,
President and CEO,
National Community Reinvestment Coalition.
Sign On Organizations and States
ACHD--Washington, ASIAN, Inc.--California, Brighton Park
Neighborhood Council--Illinois, Build WyCo--Kansas, Building
Neighborhoods Together, Inc.--Pennsylvania, California
Coalition for Rural Housing--California, CASA of Oregon--
Oregon, Ceiba--Pennsylvania, Community Development Network of
Maryland--Maryland, Community Housing Development
Corporation--California, Delaware Community Reinvestment
Action Council Inc.--Delaware, Development Finance Authority
of Summit County--Ohio, Economic Action Maryland Fund--
Maryland, Fair Finance Watch--New York, Fair Housing Center
of Northern Alabama--Alabama, Freedom Equity Inc.--Ohio,
Georgia Advancing Communities Together, Inc.--Georgia.
Help The People Programs, Inc--Georgia, Homes on the Hill
CDC--Ohio, Housing Education and Economic Development
(HEED)--Mississippi, Impact Hub Baltimore Inc.--Maryland,
Long Island Housing Services, Inc.--New York, Neighborhood
Recovery Community Development Corporation--Texas, New Jersey
Citizen Action--New Jersey, People's Opportunity Fund--
California, Philadelphia Association of Community Development
Corporations--Pennsylvania, Proud Ground--Oregon, Rural
Housing Coalition of New York--New York, South Dallas Fair
Park Innercity Community Development Corporation--Texas,
Southwest Community Development Corporation--Pennsylvania,
TCH Development Inc--Texas, United Ballot--Louisiana, United
South Broadway Corporation--New Mexico, Utah Housing
Coalition--Utah, Women's Economic Ventures--California.
Ms. WATERS. Members have a choice today. Whose side are you on? Do
you want to advance Donald Trump's deregulatory agenda to help out his
wealthy friends on Wall Street, or are you on the side of working
families, labor unions, consumers, and civil rights groups like those
all over the country who just want equal and fair access to affordable
financial products and services?
For many of you who have been in this struggle with banks, where you
have tried to get help with all kinds of issues, I want you to, again,
go to your bank where you have a problem--don't go because they are
only available on the phone--and state your problem. See who you can
get to talk to. See if you can get an appointment. See if you can get
some answers to the questions that you have.
You can't do this with these big mega banks. They don't have time for
you. They don't have time to listen to you talking about how you only
have $200,000 and you want to buy this House around the corner. They
are not interested in that.
They are interested in the big money. They are interested in not only
providing the loans for those who are spending a half million or so on
a bank that they are trying to use to get a house.
It is clear: The Big Banks are sick and tired of the way that they
are being treated. They know they have a lot of power and a lot of
friends in the Congress of the United States of America.
They don't know a new day is coming and a new way is coming. People
are learning more and more why they have a right to be disturbed about
the way that they are being treated.
I tell people: Don't be afraid to confront those Big Banks. Call us.
Get your legislator to help you out. That is what we are supposed to
do. Sometimes they can't find us.
Mr. Speaker, I reserve the balance of my time.
Mr. HILL of Arkansas. Mr. Speaker, I reserve the balance of my time.
{time} 1540
Ms. WATERS. Mr. Speaker, I yield myself the balance of my time.
Mr. Speaker, I have another letter that says: ``This dangerous bank
deregulation package would undermine core safeguards and supervision,
push risk into the shadows, and make the next publicly financed bailout
more likely. Further deregulation is especially alarming at a time when
financial regulatory agencies are under political attack, pursuing
industry-friendly agendas, and starved of resources, and when there is
effectively no oversight of financial markets.''
It was signed by the AFL-CIO, Americans for Financial Reform, and
dozens of others.
Mr. Speaker, I include this letter in the Record.
July 21, 2026.
Re Oppose bank deregulation package H.R. 6955, the Main
Street Capital Access Act or the Main Street Act.
Hon. Member of Congress,
House of Representatives,
Washington, DC.
Dear Representative: The 28 undersigned labor, civil
rights, democracy, consumer, housing, economic justice, and
public interest advocacy organizations are writing to oppose
H.R. 6955, the Main Street Capital Access Act or the Main
Street Act. This dangerous bank deregulation package would
undermine core safeguards and supervision, push risk into the
shadows, and make the next publicly financed bailout more
likely. Further deregulation is especially alarming at a time
when financial regulatory agencies are under political
attack, pursuing industry-friendly agendas, and starved of
resources, and when there is effectively no oversight of
financial markets.
H.R. 6955 treats bank rules as burdens to be minimized
rather than what they are: essential safeguards that reduce
the likelihood and severity of systemic risk, bank failures,
and publicly financed bailouts, while protecting consumers
from predatory practices, redlining, and other forms of
racial discrimination in lending.
Sections 201-204 would raise statutory thresholds, extend
``tailoring'' well beyond genuinely small and simple banks,
and hard-wire automatic future threshold increases. As a
result, fewer institutions, activities, and risks would
remain within baseline guardrails even as the financial
system grows more complex and interconnected. The combined
effect would be higher leverage and risk-taking, thinner
cushions against losses, and weaker prudential standards. It
[[Page H4729]]
would return the financial system to a pre-2008 pattern in
which risk migrates out of view, problems build for years at
midsize and large institutions, and the public is left
holding the bag when those institutions fail.
Sections 201-204 would raise statutory thresholds, expand
``tailoring'' well beyond genuinely small and simple banks,
and hard-wire automatic future threshold increases. As a
result, fewer institutions, activities, and risks would
remain inside baseline guardrails even as the system grows
more complex and interconnected. The combined effect is to
encourage higher leverage and risk-taking, thinner cushions
of safety, and looser prudential standards. It would return
the financial system to a pre-2008 pattern where risk
migrates out of view, problems build for years at midsize and
large institutions, and the public is left holding the bag
when things break.
The supervision and governance provisions in Sections 301-
304 and 401-403 would tie regulators' hands by narrowing what
examiners may consider, slowing supervisory action, and
giving banks more opportunities to appeal, contest, and delay
findings. At the same time, the bill would weaken
transparency and accountability, making it harder to detect
problems early and intervene before they turn into crises.
The competition and merchant banking provisions in Sections
601, 604, and 801 would add new stress points by accelerating
bank-fintech/crypto arrangements, and making it easier to
rubber stamp mergers and concentration--while expanding
merchant banking des that blur the line between banking and
commerce and increase conflicts of interest and complexity.
This radical legislation would compound an already
aggressive deregulatory spree at the Federal Reserve and
other banking agencies. Taken together, these changes would
be more damaging than the sum of their parts, leaving the
financial system dramatically weaker and more vulnerable to
instability and crisis. The provisions discussed below show
how H.R. 6955 would magnify ongoing agency deregulation and
dismantle safeguards needed to identify and contain risks
before they harm families, the financial system, and the
broader economy.
Section by section concerns
Sec. 201. Taking Account of Institutions with Low Operation
Risk.
This section would significantly weaken financial
regulation by mandating that agencies prioritize reducing
compliance costs for financial institutions over protecting
consumers and ensuring financial stability. The section would
create fertile ground for even large banks to challenge
regulations in court by claiming undue burden, potentially
overturning existing Dodd-Frank rules and hindering future
regulatory actions. Regulators already tailor rules based on
institution size and risk, which makes this legislation
unnecessary and potentially harmful by creating additional
legal and procedural barriers to effective oversight.
Sec. 202. Small Bank Holding Company Relief.
This section would double title consolidated asset
threshold under the Small Bank Holding Company and Savings
and Loan Holding Company Policy Statement from $3 billion to
$6 billion, posing risks to subsidiary small banks and the
financial system. This change would allow a broader range of
bank holding companies to operate with higher levels of debt
and be exempt from certain capital and leverage requirements,
particularly in order to facilitate mergers. The Federal
Reserve has long recognized that bank holding companies
should ``serve as a source of strength for their subsidiary
banks.'' Allowing parent holding companies to operate with
higher levels of debt would undermine that principle and,
instead of ``a source of strength,'' holding companies may
even drain the resources of the subsidiary banks in order to
service excessive debt. By allowing larger institutions to
operate under looser standards, this section could
dangerously incentivize increased leverage, reduce bank
safety and soundness, and accelerate bank consolidation.
Additionally, this threshold has already been eroded over the
past decade, raising it from $500 million to $1 billion in
2014, and again to $3 billion in 2018.
Sec. 203. Tailoring and Indexing Enhanced Regulations.
This section would establish automatic increases to asset
thresholds for enhanced prudential oversight every five
years, allowing problems to fester unaddressed in
increasingly large institutions that could have significant
systemic implications. The failures of Silicon Valley Bank
and First Republic demonstrate the danger of mechanically
raising asset thresholds--the last round of tailoring reduced
scrutiny of institutions whose failures ultimately required
extraordinary government intervention.
Sec. 204. Community Bank Regulatory Tailoring.
Under the pretext of relief for community banks, this
section would rewrite a wide swath of federal banking,
consumer financial protection, and fair lending laws by
mandating automatic increases of a broad range of statutory
thresholds every five years based on inflation or nominal
economic growth. The practical effect would be to steadily
and broadly expand the number and size of banks that are
excluded from regulatory oversight. The threshold increases
would inappropriately reduce compliance under statutes that
were designed for genuinely smaller and simpler banking
institutions with limited systemic footprint, and would
happen without any determination as to whether the affected
exemptions remain appropriate, whether the institutions have
become more complex or interconnected, or whether raising the
thresholds would create new supervisory gaps. Over time, this
section would reduce the number of institutions and
activities subject to baseline guardrails, weaken
transparency, increase conflicts of interest, and blunt early
warning and accountability tools embedded in the Federal
Deposit Insurance Corporation (FDIC) framework. At a time of
overlapping risks, this kind of across-the-board threshold
inflation is likely to lead to supervisory and regulatory
gaps and obscure risk from view until it is too late--all
simply because the economy has grown or prices increased. The
result would be a banking system that is more opaque and less
resilient when conditions worsen--increasing financial
fragility and the probability that losses will need to be
socialized through emergency interventions or outright
bailouts.
Importantly, the automatic increases of supervisory
thresholds would include--and thus periodically erode--Home
Mortgage Disclosure Act (HMDA) coverage and Community
Reinvestment Act (CRA) applicability, undermining fair
lending accountability and weakening critical tools that help
detect and deter redlining and other forms of racial
discrimination in mortgage and small business lending.
Sec. 301. Halting Uncertain Methods and Practices in
Supervision.
This section would undermine effective bank supervision by
restricting the CAMELS rating system to ``objective''
criteria only, sidelining important qualitative factors like
management quality and reputational risk. These factors are
essential in identifying and deterring harmful practices,
such as predatory lending, money laundering, and risky
environmental exposures. While not easily quantifiable, sound
management and public confidence have repeatedly proven vital
to bank stability, as evidenced by failures like Riggs Bank,
SVB, and Credit Suisse. The proposed changes would not
eliminate risk but would instead conceal real risks from
regulators, making supervision more mechanical and increasing
the likelihood of future financial crises.
Sec. 302. Fair Audits and Inspections for Regulators' Exams.
This section would significantly weaken bank supervision by
allowing bank to appeal any supervisory determination to a
new external ``Office of Independent Examination Review,''
which would conduct a de novo review without deference to the
original findings. This additional appeals process, layered
atop existing mechanisms, would enable banks, especially
large banks, to challenge numerous supervisory findings,
thereby impeding effective oversight. Such changes would
undermine the post-2008 financial crisis regulatory
framework, increasing systemic risks and exposing the public
to potential abuses. Robust supervision is necessary to
maintain financial stability and protect consumers, and this
section undermines it.
Addidonally, this section now includes new language that
would also allow banks, credit unions, executives, and other
institution-affiliated parties to move certain enforcement
and civil penalty proceedings from the appropriate regulator
to federal district court. This would give regulated firms
another avenue to delay and complicate enforcement,
increasing litigation costs and weakening regulators' ability
to address misconduct and unsafe practices promptly.
Sec. 304. Financial Integrity and Regulation Management.
This section would open the door and pressure regulators to
remove reputational risk considerations when assessing a
bank's safety and soundness. Reputational damage has
historically contributed to instability in major banks.
Eliminating consideration of reputational risk would hinder
regulators' ability to identify and mitigate risks,
potentially increasing the incidence of money laundering,
financial fraud and exploitation, national security threats,
and bank failures. Please also see this letter signed by 25
public interest organizations opposing the FIRM Act (H.R.
2702).
Sec. 401. FDIC Board Accountability.
This section would alter the criteria for serving on the
FDIC, reduce the consideration of consumer protection and
enforcement of consumer protection and consideration of
regulatory compliance.
Sec. 402. Stop Agency Fiat Enforcement of Guidance.
This section would require financial regulators to
emphasize that supervisory guidance is not legally binding
and that failure to follow guidance does not itself establish
a violation of law. Guidance is an important tool for
communicating supervisory expectations, identifying emerging
risks, and encouraging institutions to correct unsafe
practices before they become violations or crises. The
mandated disclaimer could encourage regulated firms to
disregard prudent supervisory expectations unless every
standard is first imposed through a lengthy formal rulemaking
or enforcement action, weakening regulators' ability to
respond quickly to developing risks.
[[Page H4730]]
Sec. 403. Regulatory Efficiency, Verification, Itemization,
and Enhanced Workflow.
This section would require financial regulators to conduct
more frequent reviews of existing rules and place greater
emphasis on cumulative compliance costs and regulatory
burdens. This would still institutionalize a recurring
deregulatory process that treats longstanding safeguards as
burdens to be minimized. These reviews could divert limited
agency resources from supervision and enforcement while
creating repeated opportunities for industry to weaken or
eliminate protections that remain necessary.
Sec. 601. Bank Competition Modernization.
This section would weaken scrutiny of bank mergers
involving institutions with less than $10 billion in assets
by directing regulators not to consider whether qualifying
transactions would substantially reduce competition or
restrain trade. This would permit greater consolidation in
many local and rural markets without a meaningful assessment
of the effects on prices, service quality, branch access, or
the availability of small-business and agricultural credit.
These anticompetitive problems will be more acute for those
with limited transportation and for services that are more
commonly received at community banks, like small business
loans and farm loans.
Sec. 604. Bank Failure Prevention.
This section would weaken oversight of bank mergers by
imposing a strict 120-day deadline--running from initial
submission, regardless of whether the record was complete--
for regulators to approve or deny applications, regardless of
whether the application is complete or all necessary
information has been provided. This would limit regulators'
ability to consider input from affected stakeholders and
properly evaluate the risks of consolidation. Bank merger
scrutiny needs to become more robust, and this section would
move in the opposite direction--further enabling a pattern of
rubber-stamping mergers, increasing costs for depositors,
customers, and small businesses as well as heightening
systemic risk.
Sec. 801. Merchant Banking Modernization.
This section would extend the alliance between the
megabanks and merchant banking that can create
anticompetitive problems and complex combinations of banking
and commerce, as happened when JPMorgan was charged with
manipulating aluminum prices through its merchant bank
affiliates' ownership of an aluminum warehouse. These
merchant banking partnerships are more likely to run afoul of
the mixing of banking and commerce and primarily benefit the
biggest banks. There is no need to extend this by 50 percent.
Moreover, it is deceptive to suggest that banks need merchant
banks to make affordable housing and small business
investments, because most banks can and do extend commercial
credit for these purposes already.
For the reasons above, we urge you to oppose this dangerous
deregulatory package and protect borrowers, small investors,
retirees, and the integrity and stability of our financial
system.
Sincerely,
African Community Housing & Development (ACHD), AFL-CIO,
Americans for Financial Reform, ASIAN. Inc., Communications
Workers of America (CWA), Community Housing Development
Corporation, Consumer Federation of America, Consumer
Reports, Delaware Community Reinvestment Action Council Inc.,
Fair Finance Watch, Freedom Equity Inc., Georgia Advancing
Communities Together, Inc., Indivisible, National Association
of Consumer Advocates.
National Community Reinvestment Coalition (NCRC), National
Consumer Law Center (on behalf of its low-income clients),
New Yorkers for Responsible Lending, Oregon Consumer Justice,
Oregon Consumer League, Proud Ground, Public Citizen, Rise
Economy, South Dallas Fair Park Innercity Community
Development Corporation, Strong Economy For All Coalition,
TCH Development, Inc, Transparency Task Force, Utah Housing
Coalition, Virginia Citizens Consumer Council.
Ms. WATERS. Mr. Speaker, we know how to support community banks and
credit unions. We just did that with our landmark housing bill, and I
was pleased to work with the chairman of that committee, Mr. Hill. It
became law just a few days ago and included five Republican bills and
four Democratic ones that were focused on supporting community banks.
Now, here come Republicans to push for what they and their allies
want: financial deregulation. This bill has 24 Republican provisions
compared to just 2 from Democrats.
In fact, I am disappointed that my friends on the other side of the
aisle are advancing provisions that even contradict our carefully
crafted bipartisan agreement in the housing bill.
There is a provision in this bill on de novo banks that goes beyond
our bipartisan deal, allowing regulators to decide whether to make
permanent reforms that really should be for Congress to decide.
We struck a compromise in passing the 21st Century ROAD to Housing
Act, and I think everyone who voted for that should honor that
compromise.
Ultimately, Mr. Speaker, this bill is a distraction from what
Congress should be focusing on: ending the affordability crisis caused
by Trump's failed policies.
Nothing in this bill will help consumers afford groceries or pay for
gas. Do you know who is not suffering during the affordability crisis?
Wall Street. This bill would loosen the guardrails on Wall Street mega
banks even as they report record profits.
Even Chairwoman Foxx admitted that this bill is all about
deregulation and rolling back Dodd-Frank, a law she said she strongly
dislikes. Chairman Hill said they received drafting assistance from
Trump's regulators and banks, but not from organizations that represent
workers or consumers.
Mr. Speaker, we are not stupid. We understand that Trump controls all
of his so-called organizations that are independent. He tells them what
to do. We get that. He is in control. He is running this country. Those
people who are selected to run these so-called independent agencies are
those who will do nothing but what they are told to do.
That is probably because the groups who represent actual people
oppose this bill. That is what they are told to do. That is the
leadership they have.
Now is not the time to plant new seeds for the next crisis. Now is
not the time to juice the mega banks' profit margins. Now is not the
time to legitimize Trump's efforts to gut the CFPB, fair lending, and
other consumer protections.
Again, I am so proud and pleased with the work we did in a bipartisan
manner. I am so proud and pleased that we were able to negotiate
through some very tough times. I am so proud to announce that we had to
give some, and we took some. They gave some, and we worked it out.
I don't know exactly what they are being told by Trump, but I know
Trump is in charge, and he is charging a lot of what is going on.
I urge my colleagues to please vote ``no'' on this bill, and support
the citizens, support their constituents, not Wall Street.
Mr. Speaker, I yield back the balance of my time.
Mr. HILL of Arkansas. Mr. Speaker, may I inquire as to the time
remaining.
The SPEAKER pro tempore. The gentleman from Arkansas has 5\1/2\
minutes remaining.
Mr. HILL of Arkansas. Mr. Speaker, I yield myself the balance of my
time.
Mr. Speaker, first, before I start, I thank the ranking member and
the committee members on her side of the aisle for their work with us
on developing this bill over many months.
Mr. Speaker, two-thirds of the bills in this package that we are
voting on, the Main Street Capital Access Act, are supported by Members
on the Democratic side of the aisle. This is a truly bipartisan package
of bills.
We have significant work and support from individual Members on the
Democratic side of the aisle in partnership with House Republicans.
I also thank Maura Woosley, who is the majority staff director, Jae
Jang, and their entire team in the majority working with the minority
staff, and the minority staff to craft this package. In Congress, you
can't put together the kinds of successful legislative packages that
the House Financial Services Committee has done in this Congress
without a very hardworking and competent staff. I thank them on both
sides of the aisle.
I thanked Andy Barr, our majority subcommittee chair, a few minutes
ago, but I will also thank Dr. Bill Foster of Illinois, who serves as
the ranking member on our Subcommittee on Financial Institutions for
his collaboration with Mr. Barr on this succesful bill.
Mr. Speaker, I heard a lot of charges about this bill, that somehow
this bill benefits Wall Street versus Main Street, and I just couldn't
disagree more. I noted that two-thirds of these bills have strong
Democratic support, along with our Republicans.
Secondly, there is nothing in this bill that weakens consumer
compliance. The fair lending laws, the fair housing laws, and the equal
credit opportunity laws, all those consumer statutes are upheld in this
text. They are not really affected by this text.
Banks have to comply with those laws. They had to comply with those
[[Page H4731]]
laws before Dodd-Frank, and they comply with them since Dodd-Frank. I
reject the idea that somehow we are limiting or curtailing or blocking
or making ineffective consumer compliance.
Secondly, it is our hometown banks, both rural banks and urban banks
in our towns and cities, that benefit from this banking set of
provisions. As the ranking member noted, in our housing bill that we
collaborated on successfully--that we got passed and it became law on
July 10--banks had some provisions there that helped them.
This is the same theme continuing in this bill. If you are a small,
well-managed bank under $6 billion, you get some relief, Mr. Speaker.
If you are well-managed, have good capital, you can help schedule your
exams.
I was with a community banker in North Carolina this week. The bank
is smaller than $500 million, and I said, how are things going? He
said, it is going great except when I have five exams in a row and then
the loan pipeline goes to zero. Because, guess what, I am the chief
loan officer and the chief compliance officer in this small bank, and
when my community bank is filled with bank examiners for an IT exam, a
trust exam, an investment exam, an AML, anti-money laundering, and Bank
Secrecy Act exam, a loan quality exam, a consumer compliance exam, I
can't make loans.
If you are well-managed and have high capital, you get some relief in
this bill. That is who this bill, Mr. Speaker, is aimed at. If you have
a concern that your exam was unfair, we return some fairness in the
exam process. You can go and actually question, was my exam fair or
not? Whose idea was that, Mr. Speaker? Democrat from Michigan Don
Riegle, U.S. Senator, 1995. Was it ever implemented? No, but it will be
implemented when this bill becomes law.
This bill is focused on more capital, more deposits, more business,
more success for our community banks, which in turn helps every one of
our towns in this country.
Who is for it? Community development financial institutions, our
CDFIs, have bipartisan support. They are for this bill. Our community
development officials across the Nation are for this bill, as they were
for the housing bill. The National Bankers Association, our national
association for African-American bankers, wrote a letter for this bill.
{time} 1350
Mr. Speaker, this bill has overwhelming support to increase
competition and help our community banks thrive and succeed, which
means our towns will thrive and succeed.
In closing, Mr. Speaker, I urge everyone on both sides of the aisle
to support this bill. Echo Alexander Hamilton, our first Secretary of
the Treasury, when he said that our banks in this early founding of our
Nation are the nurseries of our national wealth.
Mr. Speaker, today, 250 years later, long after the adoption of our
government, our community banks, our credit unions, they are the
nurseries of the national wealth that help our families and our
businesses succeed.
I urge a ``yes'' vote, and I yield back the balance of my time.
The SPEAKER pro tempore. All time for debate has expired.
Pursuant to House Resolution 1438, the previous question is ordered
on the bill, as amended.
The question is on the engrossment and third reading of the bill.
The bill was ordered to be engrossed and read a third time, and was
read the third time.
Motion to Recommit
Ms. GARCIA of Texas. Mr. Speaker, I have a motion to recommit at the
desk.
The SPEAKER pro tempore. The Clerk will report the motion to
recommit.
The Clerk read as follows:
Ms. Garcia of Texas moves to recommit the bill H.R. 6955
to the Committee on Financial Service.
The material previously referred to by Ms. Garcia of Texas is as
follows:
Ms. Garcia of Texas moves to recommit the bill H.R. 6955 to
the Committee on Financial Services with instructions to
report the same back to the House forthwith with the
following amendment:
After section 1, insert the following:
SEC. 2. LIMITATION WITH RESPECT TO G-SIBS.
The provisions of this Act and the amendments made by this
Act shall not apply to any global systemically important BHC
(as such term is defined in section 217.402 of title 12, Code
of Federal Regulations, or any successor regulation).
The SPEAKER pro tempore. Pursuant to clause 2(b) of rule XIX, the
previous question is ordered on the motion to recommit.
The question is on the motion to recommit.
The question was taken; and the Speaker pro tempore announced that
the noes appeared to have it.
Ms. GARCIA of Texas. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further
proceedings on this question will be postponed.
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