ABA Commends Congressional Effort to Reform Dodd-Frank

As the House Financial Services Committee prepares to begin the markup of the Financial Choice Act tomorrow, ABA President and CEO Rob Nichols wrote to committee leadership commending them for their efforts to address the negative consequences of the Dodd-Frank Act.

Nichols highlighted several ABA-advocated provisions in the bill, many of which are included in the association’s Blueprint for Growth. These include: the TAILOR Act, which requires regulators to tailor regulations based on a bank’s business model and risk profile; a Qualified Mortgage safe harbor for mortgages held in portfolio; the establishment of an independent office for examination review; a provision to raise the Federal Reserve’s small bank holding company threshold to $5 billion in consolidated assets; a measure providing greater flexibility for mutual banks; a repeal of the small business loan data collection requirement; and a short form call report for highly rated banks. The bill also includes a provision that would repeal the Durbin Amendment, as ABA strongly supports.

In addition, Nichols commended the committee for its efforts to rein in the Consumer Financial Protection Bureau’s broad authority, and advocated for a bipartisan commission structure to provide greater accountability. He also urged the committee to take additional steps to provide regulatory relief from unnecessary stress tests.

Finally, he expressed reservations about the Choice Act’s voluntary “off-ramp” from Dodd-Frank’s regulatory regime for banks that elect to maintain a specified level of capital. While acknowledging that the provision was well-intentioned, he pointed out that hundreds of well-run banks may choose not to pursue the exemption or be unable to do so, which would prevent them from achieving meaningful regulatory relief.


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