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[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4437 Introduced in House (IH)]
<DOC>
119th CONGRESS
1st Session
H. R. 4437
To reduce the regulatory burden on certain well managed and well
capitalized financial institutions, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 16, 2025
Mr. Timmons (for himself and Mr. Foster) introduced the following bill;
which was referred to the Committee on Financial Services
_______________________________________________________________________
A BILL
To reduce the regulatory burden on certain well managed and well
capitalized financial institutions, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Supervisory Modifications for
Appropriate Risk-based Testing Act of 2025'' or the ``SMART Act of
2025''.
SEC. 2. EXAMINATION RELIEF FOR CERTAIN WELL MANAGED AND WELL
CAPITALIZED FINANCIAL INSTITUTIONS.
(a) 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.--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 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
``(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 necessary 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.''.
(b) 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.--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 necessary 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.''.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Financial Services.
Committee Consideration and Mark-up Session Held
Ordered to be Reported (Amended) by the Yeas and Nays: 53 - 1.
Reported (Amended) by the Committee on Financial Services. H. Rept. 119-249.
Reported (Amended) by the Committee on Financial Services. H. Rept. 119-249.
Placed on the Union Calendar, Calendar No. 206.
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