The leaders of the House and Senate banking committees today announced they had reached an agreement on a bipartisan housing bill that includes several provisions related to banking, from brokered deposits to de novo bank formation.
The 21st Century ROAD to Housing Act would reward communities that build more housing supply, ease environmental review of new construction, rethink regulations that hamper additional lending for small-dollar mortgages, and expand tenant assistance and protections.
The House Financial Services Committee and Senate Banking Committee both introduced legislative packages aimed at increasing housing supply and affordability, but the two chambers disagreed on several policy points. The revised text incorporates priorities from both and is endorsed by the majority and minority leaders of the committees.
The revised text includes several banking provisions sought by House lawmakers, each previously introduced as a standalone bill:
- Custodial deposits of an insured depository institution would not be considered brokered deposits if the total amount does not exceed 20% of an institution’s total liabilities and the institution has less than $10 billion in assets. The bill also would modify the amount of deposits that are not considered to be brokered deposits under a graduated scale based on an institution’s total liabilities.
- The consolidated asset threshold would be raised from $3 billion to $6 billion for insured depository institutions to qualify for an 18-month examination cycle.
- Banking regulators would be directed to streamline the de novo application process and study ways to improve the growth of rural depository institutions.
- A new two-year phase-in pilot for de novo financial institutions to meet federal capital requirements.
- The Treasury Department would be required to establish a mentor-protégé program pairing large
financial institutions with other depository institutions, with the goal of enhancing their capacity to serve customers and potentially act as financial agents.
The bill also would increase, from 15% to 20%, the Public Welfare Investment cap applicable to banks supervised by the Office of the Comptroller of the Currency and the Federal Reserve.
