A proposed Senate bill would raise the asset-based regulatory thresholds for banks and establish a process to update them periodically going forward.
The Tailoring and Indexing Enhanced Regulations, or TIER, Act, introduced by Sen. Katie Britt (R-Ala.) would make a one-time adjustment to certain key statutory thresholds to reflect historical economic growth, according to a statement by Britt’s office. It would also require the Federal Reserve to evaluate whether nominal gross domestic product or the consumer price index is the more appropriate measure for the thresholds and periodically adjust them to reflect future economic growth.
“When our economy grows but these thresholds remain frozen in place, banks can be pushed into regulatory categories that Congress never intended for them to be simply because of economic growth,” said Britt, who is a member of the Senate Banking Committee. “The TIER Act provides a commonsense solution that preserves strong safety and soundness standards while ensuring our regulatory framework remains appropriately tailored and grounded in economic reality.”
In a statement on X, the American Bankers Association welcomed the introduction of the TIER Act while noting that Rep. Andy Barr (R-Ky.) has introduced a similar proposal in the House.
ABA said the lawmakers’ leadership on this legislation will “ensure regulations better reflect economic growth and risk, ensuring midsize and regional banks can better serve their communities.”
