The House Financial Services Committee today advanced four bills supported by the American Bankers Association, covering topics ranging from stress testing to community banks.
Committee members met to consider 11 bills. In a letter submitted ahead of the hearing, ABA expressed its support for four of the bills. They are:
- The Stress Testing Accountability and Transparency Act (H.R. 5270), led by Rep. Bill Huizenga (R-Mich.). The bill would require the Federal Reserve to issue a rule to establish models, assumptions, formulas or other decisional methodologies that are used to determine any component or subcomponent of the stress capital buffer (SCB) for a bank holding company. It would also prohibit the Fed from making material changes to the SCB calculation without a notice-and-comment rulemaking. The committee voted 28-24 to advance the bill.
- The Community Bank Leverage Improvement and Flexibility for Transparency [LIFT] Act (H.R. 5276), led by Rep. Young Kim (R-Calif.). The bill would amend the Economic Growth, Regulatory Relief and Consumer Protection Act to adjust the community bank leverage ratio to not less than 6% and not more than 8%. In addition, the legislation would increase the threshold under which banks are eligible to opt into the CBLR framework to $15 billion in total assets, compared to the current threshold of $10 billion in total assets. The committee voted 33-19 to advance the bill.
- The Merchant Banking Modernization Act (H.R. 5291), led by Rep. Roger Williams (R-Texas). The bill would amend the Bank Holding Company Act by requiring the Fed to permit merchant banking investments to be held for at least 15 years from the date of initial investment. The committee voted 35-17 to advance the bill.
- The Bank Competition Modernization Act (H.R. 5262), led by Rep. Scott Fitzgerald (R-Wisc.). The bill would amend the Federal Deposit Insurance Act, the Bank Holding Company Act and the Home Owners’ Loan Act to stipulate that mergers resulting in institutions under $10 billion in assets are presumed not to result in a monopoly, lessen competition or restrain trade. In addition, the $10 billion asset threshold in the legislation would be periodically adjusted by indexing to the nominal gross domestic product. The committee voted 28-24 to advance the bill.
