No official summary available for this bill.
[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6955 Introduced in House (IH)]
<DOC>
119th CONGRESS
2d Session
H. R. 6955
To make improvements to the Federal banking laws, and for other
purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
January 7, 2026
Mr. Hill of Arkansas (for himself, Mr. Barr, Mr. Huizenga, Mr. Lucas,
Mr. Sessions, Mrs. Wagner, Mr. Williams of Texas, Mr. Emmer, Mr.
Loudermilk, Mr. Davidson, Mr. Rose, Mr. Steil, Mr. Timmons, Mr.
Stutzman, Mr. Norman, Mr. Meuser, Mrs. Kim, Mr. Donalds, Mr. Garbarino,
Mr. Fitzgerald, Mr. Flood, Mr. Lawler, Ms. De La Cruz, Mr. Ogles, Mr.
Nunn of Iowa, Mrs. McClain, Ms. Salazar, Mr. Downing, Mr. Haridopolos,
and Mr. Moore of North Carolina) introduced the following bill; which
was referred to the Committee on Financial Services
_______________________________________________________________________
A BILL
To make improvements to the Federal banking laws, 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; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Main Street
Capital Access Act'' or the ``Main Street Act''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
TITLE I--NEW BANK FORMATION AND LOCAL COMMUNITY ACCESS
Sec. 101. Promoting New Bank Formation.
Sec. 102. New Bank Application Numbers Knowledge.
Sec. 103. Bank Failure Prevention.
Sec. 104. Rural Depositories Revitalization Study.
TITLE II--TAILORING BANK REGULATION
Sec. 201. Taking Account of Institutions with Low Operation Risk.
Sec. 202. Small Bank Holding Company Relief.
Sec. 203. Community Bank Leverage Improvement and Flexibility for
Transparency.
Sec. 204. Tailoring and Indexing Enhanced Regulations.
TITLE III--FAIR AND TRANSPARENT BANK SUPERVISION
Sec. 301. Halting Uncertain Methods and Practices in Supervision.
Sec. 302. Fair Audits and Inspections for Regulators' Exams.
Sec. 303. Supervisory Modifications for Appropriate Risk-based Testing.
Sec. 304. Tailored Regulatory Updates for Supervisory Testing.
Sec. 305. Stress Testing Accountability and Transparency.
Sec. 306. Community Bank Representation.
Sec. 307. Financial Integrity and Regulation Management.
TITLE IV--REGULATORY ACCOUNTABILITY AND TRANSPARENCY
Sec. 401. FDIC Board Accountability.
Sec. 402. Stop Agency Fiat Enforcement of Guidance.
Sec. 403. Regulatory Efficiency, Verification, Itemization, and
Enhanced Workflow.
Sec. 404. American Financial Institution Regulatory Sovereignty and
Transparency.
TITLE V--STRENGTHENING LOCAL BANK FUNDING
Sec. 501. Bringing the Discount Window into the 21st Century.
Sec. 502. Keeping Deposits Local.
Sec. 503. Community Bank Deposit Access.
TITLE VI--PROMOTING BANK COMPETITION AND MERGER CLARITY
Sec. 601. Bank Competition Modernization.
Sec. 602. Merger Agreement Approvals Clarity and Predictability.
Sec. 603. Merger Process Review.
TITLE VII--STRENGTHENING TRANSPARENCY AND INVOLVEMENT IN BANK
RESOLUTIONS
Sec. 701. Least Cost Exception.
Sec. 702. Enhancing Bank Resolution Participation.
TITLE VIII--FACILITATING INNOVATION AND BANK PARTNERSHIPS
Sec. 801. Merchant Banking Modernization.
Sec. 802. Bank-Fintech Partnership Enhancement.
TITLE I--NEW BANK FORMATION AND LOCAL COMMUNITY ACCESS
SEC. 101. PROMOTING NEW BANK FORMATION.
(a) Phase-In of Capital Standards.--Notwithstanding any other
provision of law, the Federal banking agencies shall issue rules that
provide for a 3-year phase-in period for a depository institution or
depository institution holding company to meet any Federal capital
requirements that would otherwise be applicable to the depository
institution or depository institution holding company, beginning on--
(1) the date on which the depository institution became an
insured depository institution; or
(2) in the case of a depository institution holding
company, the date on which the depository institution
subsidiary of the depository institution holding company became
an insured depository institution.
(b) Changes to Business Plans.--
(1) In general.--During the 3-year period beginning on the
date on which a depository institution became an insured
depository institution, if, as a condition of approval, the
appropriate Federal banking agency imposes a requirement to
obtain prior approval before deviating from a business plan,
the insured depository institution or its depository
institution holding company may request to deviate materially
from a business plan that has been approved by the appropriate
Federal banking agency by submitting a request to such agency
pursuant to this section.
(2) Review of changes.--The appropriate Federal banking
agency shall, not later than the end of the 30-day period
beginning on the receipt of a request under paragraph (1)--
(A) approve, conditionally approve, or deny such
request; and
(B) notify the applicant of such decision and, if
the agency denies the request--
(i) provide the applicant with the reason
for such denial; and
(ii) suggest changes to the request that,
if adopted, would allow the agency to approve
such request.
(3) Result of failure to act.--If an appropriate Federal
banking agency fails to approve or deny a request within the
30-day period required under paragraph (2), such request shall
be deemed to be approved.
(c) Rural Community Depository Institution Leverage Ratio.--
(1) In general.--During the 3-year period beginning on the
date on which a rural depository institution became an insured
depository institution, the Community Bank Leverage Ratio for
the rural community bank shall be the lesser of--
(A) the Community Bank Leverage Ratio adopted by
the Federal banking agencies pursuant to section
201(b)(1) of the Economic Growth, Regulatory Relief,
and Consumer Protection Act (12 U.S.C. 5371 note); or
(B) 7.5 percent.
(2) Phase-in authority.--The Federal banking agencies shall
issue rules to phase-in the Community Bank Leverage Ratio
described under paragraph (1) with respect to a rural
depository institution by setting lower Community Bank Leverage
Ratio percentages during the first 2 years of the 3-year period
described under paragraph (1).
(3) Definitions.--In this subsection:
(A) Community bank leverage ratio.--The term
``Community Bank Leverage Ratio'' has the meaning given
that term under section 201(a) of the Economic Growth,
Regulatory Relief, and Consumer Protection Act (12
U.S.C. 5371 note).
(B) Rural area.--The term ``rural area'' means--
(i) a county that is neither in a
metropolitan statistical area nor in a
micropolitan statistical area that is adjacent
to a metropolitan statistical area, as those
terms are defined by the Office of Management
and Budget and as they are applied under
applicable Urban Influence Codes, established
by the Department of Agriculture's Economic
Research Service; or
(ii) a census block that is not in an urban
area, as defined by the Bureau of the Census
using the latest decennial census of the United
States.
(C) Rural depository institution.--The term ``rural
depository institution'' means a depository
institution--
(i) with total consolidated assets of less
than $10,000,000,000; and
(ii) located in a rural area.
(d) Agricultural Loan Authority for Federal Savings Associations.--
Section 5(c) of the Home Owners' Loan Act (12 U.S.C. 1464(c)) is
amended--
(1) in paragraph (1), by adding at the end the following:
``(V) Agricultural loans.--Secured or unsecured
loans for agricultural purposes.''; and
(2) in paragraph (2)(A), by striking ``business, or
agricultural'' and inserting ``or business''.
(e) Study on De Novo Insured Depository Institutions.--
(1) Study.--The Federal banking agencies shall, jointly,
carry out a study on--
(A) the principal causes for the low number of de
novo insured depository institutions in the 10-year
period ending on the date of enactment of this Act; and
(B) ways to promote more de novo insured depository
institutions in areas currently underserved by insured
depository institutions.
(2) Report to congress.--Not later than the end of the 1-
year period beginning on the date of enactment of this Act, the
Federal banking agencies shall, jointly, issue a report to
Congress containing all findings and determinations made in
carrying out the study required under paragraph (1).
(f) Definitions.--In this section, the terms ``appropriate Federal
banking agency'', ``depository institution'', ``depository institution
holding company'', ``Federal banking agency'', and ``insured depository
institution'' have the meaning given those terms, respectively, under
section 3 of the Federal Deposit Insurance Act.
SEC. 102. NEW BANK APPLICATION NUMBERS KNOWLEDGE.
(a) Annual Report on National Bank and Federal Savings Association
Charter Applications.--The Comptroller of the Currency shall publish an
annual report that includes the following, or with respect to any
equivalent procedure used by the Office of the Comptroller of the
Currency includes the following:
(1) The number of applications for a national bank or
Federal savings association charter received, approved on a
preliminary basis, approved on a final basis, denied,
withdrawn, inactive, expired, mooted, returned, returned
pending resubmission, or otherwise dispositioned.
(2) The mean and median times for preliminary approval of
such applications.
(3) The mean and median times for final approval of such
applications.
(4) To the extent practicable, common reasons leading to
the denial, withdrawal, or expiration of preliminary approval
of such applications.
(b) Annual Report on Federal Credit Union Charter Applications.--
The National Credit Union Administration shall publish an annual report
that includes the following, or with respect to any equivalent
procedure used by the Board includes the following:
(1) The number of Federal credit union charter applications
received, approved on a final basis, denied, withdrawn,
inactive, or returned pending resubmission.
(2) The mean and median times for final approval of such
applications.
(3) To the extent practicable, common reasons leading to
application denial, withdrawal, inactivity, or to applications
being returned for resubmission.
(c) Annual Report on Depository Institution Holding Company
Applications.--
(1) In general.--The Board of Governors of the Federal
Reserve System shall publish an annual report that includes the
following, or with respect to any equivalent procedure used by
the Board of Governors includes the following:
(A) The number of applications to become a top-tier
depository institution holding company received,
approved on a preliminary basis, approved on a final
basis, denied, withdrawn, inactive, expired, mooted,
returned, returned pending resubmission, or otherwise
dispositioned.
(B) The mean and median times to approve such
applications.
(C) To the extent practicable, common reasons
leading to denial or withdrawal of such applications.
(2) Top-tier depository institution holding company
defined.--The term ``top-tier depository institution holding
company'' means a depository institution holding company (as
defined in section 3 of the Federal Deposit Insurance Act (12
U.S.C. 1813)) that is not controlled by any other depository
institution holding company.
(d) Annual Report on Federal Deposit Insurance Applications.--The
Federal Deposit Insurance Corporation shall publish an annual report
that includes the following, or with respect to any equivalent
procedure used by the Corporation includes the following:
(1) The number of applications for deposit insurance
received, approved on a preliminary basis, approved on a final
basis, denied, withdrawn, inactive, expired, mooted, returned,
returned pending resubmission, or otherwise dispositioned.
(2) The mean and median times to approve such applications.
(3) To the extent practicable, common reasons leading to
denial or withdrawal of such applications.
(e) Annual Report on State Depository Institution and State Credit
Union Charter Applications.--
(1) In general.--The Board of Governors of the Federal
Reserve System, the Federal Deposit Insurance Corporation, and
the National Credit Union Administration Board shall, jointly,
and in consultation with State banking regulators and State
credit union regulators, publish an annual report that includes
the following, or with respect to any equivalent procedure used
by such agencies includes the following:
(A) The number of applications for a State
depository institution charter received, approved on a
preliminary basis, approved on a final basis, denied,
withdrawn, inactive, expired, mooted, returned,
returned pending resubmission, or otherwise
dispositioned.
(B) The mean and median times to approve such
applications, with times for each State shown
separately.
(C) To the extent practicable, common reasons
leading to denial or withdrawal of such applications.
(2) Definitions.--In this subsection:
(A) State.--The term ``State'' means any State of
the United States, the District of Columbia, and any
territory of the United States.
(B) State bank.--The term ``State bank'' has the
meaning given such term in section 3 of the Federal
Deposit Insurance Act (12 U.S.C. 1813).
(C) State depository institution.--The term ``State
depository institution'' means--
(i) a State depository institution, as
defined in section 3 of the Federal Deposit
Insurance Act (12 U.S.C. 1813); and
(ii) a State credit union, as defined in
section 101 of the Federal Credit Union Act (12
U.S.C. 1752).
(D) State savings association.--The term ``State
savings association'' has the meaning given such term
in section 3 of the Federal Deposit Insurance Act (12
U.S.C. 1813).
SEC. 103. BANK FAILURE PREVENTION.
(a) Bank Holding Companies.--Section 3(b)(1) of the Bank Holding
Company Act of 1956 (12 U.S.C. 1842(b)(1)) is amended--
(1) by striking ``Upon receiving'' and inserting the
following:
``(A) In general.--Upon receiving'';
(2) by striking ``required'' and inserting ``acquired'';
(3) by striking ``In the event of the failure of the Board
to act on any application for approval under this section
within the ninety-one-day period which begins on the date of
submission to the Board of the complete record on that
application, the application shall be deemed to have been
granted.''; and
(4) by adding at the end the following:
``(B) Complete record on an application.--
``(i) Notice to applicant.--Not later than 30 days
after the date on which the Board receives an
application for approval under this section, the Board
shall transmit to the applicant a letter that either--
``(I) confirms the record on the
application is complete; or
``(II) details all additional information
that is required for the record on that
application to be complete.
``(ii) Extension of notice.--Notwithstanding clause
(i), the Board may, if an application is complex,
extend the 30-day period described under clause (i) for
an additional 30 days.
``(iii) Receipt of response; deeming of complete
record.--Upon receipt of a response from an applicant
to a notice requesting additional information described
under clause (i)(II), the record on the application
shall be deemed complete unless the Board--
``(I) determines that the applicant's
response was materially deficient; and
``(II) not later than 30 days after the
date on which the Board received the response,
provides the applicant a detailed notice
describing the deficiencies.
``(iv) Treatment of third-party information.--In
determining whether the record on an application is
complete, the Board may take into account only
information provided by the applicant, and may not base
the determination of completeness on any information
(including reports, views, or recommendations) provided
by third parties.
``(C) Deadline for determination.--
``(i) In general.--Notwithstanding subparagraphs
(A) and (B), the Board shall grant or deny an
application submitted under this section not later than
90 days after the date on which the application was
initially submitted to the Board, regardless of whether
the record on such initial application was complete.
``(ii) Failure to make a determination.--If the
Board does not grant or deny an application within the
time period described under clause (i), such
application shall be deemed to have been granted.
``(iii) Tolling of period.--The Board may at any
time extend the deadline described under clause (i) at
the request of the applicant, but may not extend the
deadline more than 30 days past the deadline described
under clause (i).''.
(b) Savings and Loan Holding Companies.--Section 10(e) of the Home
Owners' Loan Act (12 U.S.C. 1467a(e)) is amended--
(1) in paragraph (2), by striking ``, and shall render a
decision within 90 days after submission to the Board of the
complete record on the application'';
(2) by redesignating paragraph (7) as paragraph (9); and
(3) by inserting after paragraph (6) the following:
``(7) Complete record on an application.--
``(A) Notice to applicant.--Not later than 30 days
after the date on which the Board receives an
application for approval under this subsection, the
Board shall transmit to the applicant a letter that
either--
``(i) confirms the record on the
application is complete; or
``(ii) details all additional information
that is required for the record on that
application to be complete.
``(B) Extension of notice.--Notwithstanding
subparagraph (A), the Board may, if an application is
complex, extend the 30-day period described under
subparagraph (A) for an additional 30 days.
``(C) Receipt of response; deeming of complete
record.--Upon receipt of a response from an applicant
to a notice requesting additional information described
under subparagraph (A)(ii), the record on the
application shall be deemed complete unless the Board--
``(i) determines that the applicant's
response was materially deficient; and
``(ii) not later than 30 days after the
date on which the Board received the response,
provides the applicant a detailed notice
describing the deficiencies.
``(D) Treatment of third-party information.--In
determining whether the record on an application is
complete, the Board may take into account only
information provided by the applicant, and may not base
the determination of completeness on any information
(including reports, views, or recommendations) provided
by third parties.
``(8) Deadline for determination.--
``(A) In general.--Notwithstanding any other
provision of this subsection, the Board shall grant or
deny an application submitted under this subsection not
later than 90 days after the date on which the
application was initially submitted to the Board,
regardless of whether the record on such initial
application was complete.
``(B) Failure to make a determination.--If the
Board does not grant or deny an application within the
time period described under subparagraph (A), such
application shall be deemed to have been granted.
``(C) Tolling of period.--The Board may at any time
extend the deadline described under subparagraph (A) at
the request of the applicant, but may not extend the
deadline more than 30 days past the deadline described
under subparagraph (A).''.
(c) Insured Depository Institutions.--Section 18(c) of the Federal
Deposit Insurance Act (12 U.S.C. 1828(c)) is amended by adding at the
end the following:
``(14) Complete Record on an Application.--
``(A) Notice to applicant.--Not later than 30 days after
the date on which the responsible agency receives a merger
application for approval under this subsection, the responsible
agency shall transmit to the applicant a letter that either--
``(i) confirms the record on the application is
complete; or
``(ii) details all additional information that is
required for the record on that application to be
complete.
``(B) Extension of notice.--Notwithstanding subparagraph
(A), the responsible agency may, if an application is unusually
complex, extend the 30-day period described under subparagraph
(A) for an additional 30 days.
``(C) Receipt of response; deeming of complete record.--
Upon receipt of a response from an applicant to a notice
requesting additional information described under subparagraph
(A)(ii), the record on the application shall be deemed complete
unless the responsible agency--
``(i) determines that the applicant's response was
materially deficient; and
``(ii) not later than 30 days after the date on
which the responsible agency received the response,
provides the applicant a detailed notice describing the
deficiencies.
``(D) Treatment of third-party information.--In determining
whether the record on an application is complete, the
responsible agency may take into account only information
provided by the applicant, and may not base the determination
of completeness on any information (including reports, views,
or recommendations) provided by third parties.
``(15) Deadline for Determination.--
``(A) In general.--Notwithstanding any other provision of
this subsection, the responsible agency shall grant or deny a
merger application submitted under this subsection not later
than 90 days after the date on which the application was
initially submitted to the responsible agency, regardless of
whether the record on such initial application was complete.
``(B) Failure to make a determination.--If the responsible
agency does not grant or deny an application within the time
period described under subparagraph (A), such application shall
be deemed to have been granted.
``(C) Tolling of period.--The responsible agency may at any
time extend the deadline described under subparagraph (A) at
the request of the applicant, but may not extend the deadline
more than 30 days past the deadline described under
subparagraph (A).''.
SEC. 104. RURAL DEPOSITORIES REVITALIZATION STUDY.
(a) Study.--The Federal banking agencies shall, jointly, carry out
a study--
(1) to identify methods to improve the growth, capital
adequacy, and profitability of depository institutions in the
United States that primarily serve rural areas; and
(2) to identify Federal statutes (other than appropriations
Acts) or regulations of the Federal banking agencies that
limit--
(A) the methods identified under paragraph (1); or
(B) the establishment of de novo depository
institutions in rural areas.
(b) Report.--Not later than 1 year after the date of enactment of
this Act, the Federal banking agencies shall, jointly, issue a report
to Congress containing all findings and determinations made in carrying
out the study required under subsection (a).
(c) Definitions.--In this section:
(1) Depository institution.--The term ``depository
institution'' has the meaning given that term in section 3 of
the Federal Deposit Insurance Act (12 U.S.C. 1813).
(2) Federal banking agencies.--The term ``Federal banking
agencies'' means the Board of Governors of the Federal Reserve
System, the Comptroller of the Currency, and the Federal
Deposit Insurance Corporation.
(3) Rural.--With respect to an area, the term ``rural'' has
the meaning given that term in section 1026.35(b)(2)(iv)(A) of
title 12, Code of Federal Regulations.
TITLE II--TAILORING BANK REGULATION
SEC. 201. TAKING ACCOUNT OF INSTITUTIONS WITH LOW OPERATION RISK.
(a) Tailoring Regulation to Business Model and Risk.--
(1) Definitions.--In this subsection--
(A) the term ``Federal financial institutions
regulatory agency'' means the Office of the Comptroller
of the Currency, the Board of Governors of the Federal
Reserve System, the Federal Deposit Insurance
Corporation, the National Credit Union Administration,
and the Bureau of Consumer Financial Protection; and
(B) the term ``regulatory action''--
(i) means any proposed, interim, or final
rule or regulation; and
(ii) does not include any action taken by a
Federal financial institutions regulatory
agency that is solely applicable to an
individual institution, including an
enforcement action, adjudication, or order.
(2) Consideration and tailoring.--For any regulatory action
occurring after the date of enactment of this Act, each Federal
financial institutions regulatory agency shall--
(A) take into consideration the risk profile and
business models of each type of institution or class of
institutions subject to the regulatory action; and
(B) tailor the regulatory action applicable to an
institution, or type of institution, in a manner that
limits the regulatory impact, including cost, human
resource allocation, and other burdens, on the
institution or type of institution as is appropriate
for the risk profile and business model involved.
(3) Factors to consider.--In carrying out the requirements
of paragraph (2) with respect to a regulatory action, each
Federal financial institutions regulatory agency shall
consider--
(A) the aggregate effect of all applicable
regulatory actions on the ability of institutions to
flexibly serve customers of the institutions and local
markets on and after the date of enactment of this Act;
(B) the potential that efforts to implement the
regulatory action and third-party service provider
actions may work to undercut efforts to tailor the
regulatory action, as described in paragraph (2)(B);
and
(C) the statutory provision authorizing the
regulatory action, the congressional intent with
respect to the statutory provision, and the underlying
policy objectives of the regulatory action.
(4) Notice of proposed and final rulemaking.--Each Federal
financial institutions regulatory agency shall disclose and
document in every notice of proposed rulemaking and in any
final rulemaking for a regulatory action how the agency has
applied paragraphs (2) and (3).
(5) Reports to congress.--Not later than 1 year after the
date of enactment of this Act and annually thereafter, each
Federal financial institutions regulatory agency shall submit
to the Committee on Banking, Housing, and Urban Affairs of the
Senate and the Committee on Financial Services of the House of
Representatives a report on the specific actions taken to
tailor the regulatory actions of the Federal financial
institutions regulatory agency pursuant to the requirements of
this section.
(6) Limited look-back application.--
(A) In general.--Each Federal financial
institutions regulatory agency shall--
(i) conduct a review of all final
regulations issued pursuant to statutes enacted
during the period beginning on the date that is
15 years before the date on which this Act is
introduced and ending on the date of enactment
of this Act; and
(ii) apply the requirements of this section
to the regulations described in clause (i).
(B) Revision.--Any regulation revised under
subparagraph (A) shall be revised not later than 3
years after the date of enactment of this Act.
(b) Short-Form Call Reports for All Banks Eligible for the
Community Bank Leverage Ratio.--The appropriate Federal banking
agencies, as defined in section 3 of the Federal Deposit Insurance Act
(12 U.S.C. 1813), shall promulgate regulations establishing a reduced
reporting requirement for all banks eligible for the Community Bank
Leverage Ratio, as defined in section 201(a) of the Economic Growth,
Regulatory Relief, and Consumer Protection Act (12 U.S.C. 5371 note),
when making the first and third report of condition of a year as
required by section 7(a) of the Federal Deposit Insurance Act (12
U.S.C. 1817(a)).
(c) Report to Congress on Modernization of Supervision.--Not later
than 18 months after the date of enactment of this Act, the appropriate
Federal banking agencies, as defined in section 3 of the Federal
Deposit Insurance Act (12 U.S.C. 1813), in consultation with State bank
supervisors, shall submit to the Committee on Banking, Housing, and
Urban Affairs of the Senate and the Committee on Financial Services of
the House of Representatives a report on the modernization of bank
supervision, including the following factors:
(1) Changing bank business models.
(2) Examiner workforce and training.
(3) The structure of supervisory activities within banking
agencies.
(4) Improving bank-supervisor communication and
collaboration.
(5) The use of supervisory technology.
(6) Supervisory factors uniquely applicable to community
banks.
(7) Changes in statutes necessary to achieve more effective
supervision.
SEC. 202. SMALL BANK HOLDING COMPANY RELIEF.
Not later than 180 days after the date of the enactment of this
Act, the Board of Governors of the Federal Reserve System shall revise
appendix C to part 225 of title 12, Code of Federal Regulations
(commonly known as the ``Small Bank Holding Company and Savings and
Loan Holding Company Policy Statement''), to raise the consolidated
asset threshold under that appendix to $25,000,000,000 for any bank
holding company or savings and loan holding company.
SEC. 203. COMMUNITY BANK LEVERAGE IMPROVEMENT AND FLEXIBILITY FOR
TRANSPARENCY.
(a) Community Bank Leverage Ratio.--
(1) In general.--Section 201 of the Economic Growth,
Regulatory Relief, and Consumer Protection Act (12 U.S.C. 5371
note) is amended--
(A) in subsection (a)(3)(A), by striking
``$10,000,000,000'' and inserting ``$15,000,000,000'';
and
(B) in subsection (b)(1), by striking ``not less
than 8 percent and not more than 10 percent'' and
inserting ``not less than 6 percent and not more than 8
percent''.
(2) Rulemaking deadline.--Not later than the end of the
180-day period beginning on the date of enactment of this Act,
and after reviewing the report issued pursuant to subsection
(b)(2), the Board of Governors of the Federal Reserve System,
the Comptroller of the Currency, and the Federal Deposit
Insurance Corporation shall propose and, not later than 1 year
after the date of the enactment of this Act, such agencies
shall finalize rules to carry out the amendments made by
paragraph (1) and the recommended modifications contained in
such report.
(b) Review of the Community Bank Leverage Ratio.--
(1) In general.--The Board of Governors of the Federal
Reserve System, the Comptroller of the Currency, and the
Federal Deposit Insurance Corporation shall commence a review
of the Community Bank Leverage Ratio (``CBLR'') developed under
section 201 of the Economic Growth, Regulatory Relief, and
Consumer Protection Act (12 U.S.C. 5371 note), and rules issued
thereunder, which shall include a consideration of how to
modify and calibrate the CBLR to encourage more qualifying
community banks to opt-in to the CBLR framework, with an
additional focus on--
(A) those qualifying community banks with fewer
assets; and
(B) providing regulatory compliance burden relief
so that the CBLR is simple to apply.
(2) Report.--Not later than the end of the 150-day period
beginning on the date of enactment of this Act, the Board of
Governors of the Federal Reserve System, the Comptroller of the
Currency, and the Federal Deposit Insurance Corporation shall
issue a report to the Committee on Financial Services of the
House of Representatives and the Committee on Banking, Housing,
and Urban Affairs of the Senate containing--
(A) all findings and determinations made in
carrying out the review under paragraph (1); and
(B) specific recommendations on modifications, if
any, to--
(i) the calculation of the numerator and
denominator of the CBLR;
(ii) the treatment of specific asset
classes or exposures to better reflect the risk
profiles of community banks;
(iii) the definition of and qualifying
criteria for a qualifying community bank;
(iv) enhancements to the procedures for
opting into or out of the CBLR framework,
including streamlined reporting and transition
mechanisms;
(v) the grace period to facilitate the
transition to and from a modified CBLR regime;
and
(vi) any statutory changes that may be
needed to address such recommendations.
(3) Qualifying community bank defined.--In this subsection,
the term ``qualifying community bank'' has the meaning given
that term in section 201(a)(3)(A) of the Economic Growth,
Regulatory Relief, and Consumer Protection Act (12 U.S.C. 5371
note).
SEC. 204. TAILORING AND INDEXING ENHANCED REGULATIONS.
(a) Threshold Adjustments To Account for Historical Increases in
Current-Dollar United States Gross Domestic Product.--
(1) Federal reserve act.--The second subsection (s)
(relating to assessments) of section 11 of the Federal Reserve
Act (12 U.S.C. 248(s)) is amended--
(A) in paragraph (2), by striking
``$100,000,000,000'' each place that term appears and
inserting ``$150,000,000,000''; and
(B) in paragraph (3), by striking ``between
$100,000,000,000 and $250,000,000,000'' and inserting
``between $150,000,000,000 and $370,000,000,000''.
(2) Bank holding company act of 1956.--Section
4(k)(6)(B)(ii) of the Bank Holding Company Act of 1956 (12
U.S.C. 1843(k)(6)(B)(ii)) is amended, by striking
``$10,000,000,000'' and inserting ``$15,000,000,000''.
(3) Financial stability act of 2010.--The Financial
Stability Act of 2010 (12 U.S.C. 5311 et seq.) is amended--
(A) in section 116(a) (12 U.S.C. 5326(a)), by
striking ``$250,000,000,000'' and inserting
``$370,000,000,000'';
(B) in section 121(a) (12 U.S.C. 5331(a)), by
striking ``$250,000,000,000'' and inserting
``$370,000,000,000'';
(C) in section 163(b) (12 U.S.C. 5363(b))--
(i) by striking ``$250,000,000,000'' each
place that term appears and inserting
``$370,000,000,000''; and
(ii) by striking ``$10,000,000,000'' and
inserting ``$15,000,000,000'';
(D) in section 164 (12 U.S.C. 5364), by striking
``$250,000,000,000'' and inserting
``$370,000,000,000''; and
(E) in section 165 (12 U.S.C. 5365)--
(i) in subsection (a)--
(I) in paragraph (1), by striking
``$250,000,000,000'' and inserting
``$370,000,000,000''; and
(II) in paragraph (2)(C), by
striking ``$100,000,000,000'' and
inserting ``$150,000,000,000'';
(ii) in subsection (h)(2), by striking
``$50,000,000,000'' each place that term
appears and inserting ``$75,000,000,000'';
(iii) in subsection (i)(2)(A), by striking
``$250,000,000,000'' and inserting
``$370,000,000,000''; and
(iv) in subsection (j)(1), by striking
``$250,000,000,000'' and inserting
``$370,000,000,000''.
(4) Economic growth, regulatory relief, and consumer
protection act.--Section 401(f) of the Economic Growth,
Regulatory Relief, and Consumer Protection Act (12 U.S.C. 5365
note) is amended by striking ``$250,000,000,000'' and inserting
``$370,000,000,000''.
(b) Periodic Adjustments to Thresholds To Account for Future
Increases in Current-Dollar United States Gross Domestic Product.--
(1) In general.--The Financial Stability Act of 2010 (12
U.S.C. 5311 et seq.) is further amended by adding at the end
the following:
``SEC. 177. PERIODIC ADJUSTMENTS TO THRESHOLDS TO ACCOUNT FOR INCREASES
IN CURRENT-DOLLAR UNITED STATES GROSS DOMESTIC PRODUCT.
``(a) In General.--By April 1, 2031, and the 1st day of each
subsequent 5-year period, the Board of Governors shall increase the
thresholds described in subsection (b) by the ratio, if greater than 1,
of the annual value of current-dollar United States gross domestic
product, published by the Department of Commerce, for the calendar year
preceding the year in which the adjustment is calculated under this
section, to the published annual value of such index for the calendar
year preceding April 1, 2026.
``(b) Covered Thresholds.--The thresholds described in this
subsection are the following:
``(1) Each bank holding company or savings and loan holding
company total consolidated asset amount in the second
subsection (s) (relating to assessments) of section 11 of the
Federal Reserve Act.
``(2) Each bank holding company total consolidated asset
amount in--
``(A) sections 116(a), 121(a), 163(b), 164,
165(a)(1), 165(h)(2), 165(j)(1) of this Act; and
``(B) section 401(f) of the Economic Growth,
Regulatory Relief, and Consumer Protection Act.
``(3) Each financial company total consolidated asset
amount in section 165(i)(2)(A) of this Act.
``(c) Currency of Information.--The values used in the calculation
under subsection (a) shall be, as of the date of the calculation, the
values most recently published by the Department of Commerce.
``(d) Rounding.--
``(1) If any amount equal to or greater than
$100,000,000,000 determined under subsection (a) for any period
is not a multiple of $50,000,000,000, the amount shall be
rounded up to the nearest $50,000,000,000.
``(2) If any amount less than $100,000,000,000 determined
under subsection (a) for any period is not a multiple of
$5,000,000,000, the amount shall be rounded up to the nearest
$5,000,000,000.
``(e) Publication.--Not later than April 5 of any calendar year in
which an adjustment is required to be calculated under subsection (a),
the Board of Governors shall publish in the Federal Register the
amounts as so calculated.
``(f) Implementation Period.--Any increase in amounts determined
under subsection (a) shall take effect on January 1 of the year
immediately succeeding the calendar year in which the increase is
required to be calculated under subsection (a).
``SEC. 178. ADJUSTMENTS TO THRESHOLDS ESTABLISHED BY RULE TO ACCOUNT
FOR INCREASES IN CURRENT-DOLLAR UNITED STATES GROSS
DOMESTIC PRODUCT.
``(a) Agency Review.--Not later than June 30, 2026, and the 1st day
of each subsequent 5-year period, the Board of Governors, the
Comptroller of the Currency, and the Corporation shall, to the extent
applicable, review--
``(1) any regulation--
``(A) implementing section 165 of this Act; or
``(B) making specific cross-reference to any
regulation of the Board of Governors implementing
section 165 of this Act; and
``(2) any asset threshold or other quantitative threshold
in such regulations implementing section 165 of this Act, or in
such regulations making specific cross-reference to any
regulation of the Board of Governors implementing section 165
of this Act, the amount of which is not prescribed by statute.
``(b) Modifications Required.--The Board of Governors, the
Comptroller of the Currency, and the Corporation shall modify any such
thresholds identified by each review conducted under subsection (a) by
the ratio, if greater than 1, of the annual value of current-dollar
United States gross domestic product, published by the Department of
Commerce, for the calendar year preceding the year in which the
modification is calculated under this section, to the published annual
value of such index for the calendar year preceding the effective date
of such threshold, as each respective agency shall determine as
appropriate for such regulations. In making such determination, the
Board of Governors, the Comptroller of the Currency, and the
Corporation shall--
``(1) use the values for current-dollar United States gross
domestic product most recently published by the Department of
Commerce as of the date of commencement of the review;
``(2) seek to establish, to the extent feasible, uniform
thresholds for use by each such agency, taking into account the
entities regulated by each such agency and the purposes for
which such threshold was established; and
``(3) seek to adjust such thresholds, to the extent
feasible, with rounding consistent with section 177(d) of this
Act.
``(c) Report.--Upon conclusion of each review required under
subsection (a), each of the Board of Governors, the Comptroller of the
Currency, and the Corporation shall transmit a report to Congress
containing a description of any modification of any regulation such
agency made pursuant to subsection (b).''.
(2) Clerical amendment.--The table of contents in section
1(b) of the Dodd-Frank Wall Street Reform and Consumer
Protection Act is amended by inserting after the item relating
to section 176 the following:
``Sec. 177. Periodic adjustments to thresholds to account for increases
in current-dollar United States gross
domestic product.
``Sec. 178. Adjustments to thresholds established by rule to account
for increases in current-dollar United
States gross domestic product.''.
TITLE III--FAIR AND TRANSPARENT BANK SUPERVISION
SEC. 301. HALTING UNCERTAIN METHODS AND PRACTICES IN SUPERVISION.
(a) Findings.--Congress finds that--
(1) CAMELS ratings (Capital adequacy, Asset quality,
Management, Earnings, Liquidity, and Sensitivity to market
risk) are a critical tool for evaluating the safety and
soundness of financial institutions, and the basis for
determining significant regulatory matters such as the
evaluation for mergers and acquisitions and a bank's deposit
insurance premiums;
(2) the CAMELS rating system relies heavily on examiner
judgment, which can lead to subjective and inconsistent ratings
across similar institutions;
(3) establishing clear, objective measures for each CAMELS
component and their relative weighting in determining composite
ratings will promote fairness, consistency, and accountability
in supervisory assessments; and
(4) examination and supervision, as well as the CAMELS
rating system, should focus on a financial institution's
material financial condition or solvency.
(b) Amendments to the CAMELS Rating System.--
(1) In general.--The Federal Financial Institutions
Examination Council Act of 1978 (12 U.S.C. 3301 et seq.) is
amended by adding at the end the following:
``SEC. 1012. AMENDMENTS TO THE CAMELS RATING SYSTEM.
``(a) In General.--The Council shall make recommendations to amend
the Uniform Financial Institutions Rating System, and the CAMELS
components thereunder, to--
``(1) establish clear and objective criteria for assessing
each CAMELS component;
``(2) revise the factors affecting each CAMELS component to
derive a composite rating that more accurately reflects the
material financial condition and risk profile of the financial
institutions being rated;
``(3) either--
``(A) eliminate the management component of the
CAMELS rating system; or
``(B) revise the management component of the CAMELS
rating system to limit the assessment under such
component to objective measures of the governance and
controls used to manage an institution's risk profile;
``(4) ensure that composite ratings consider the financial
institution's compliance with--
``(A) section 21 of the Federal Deposit Insurance
Act (12 U.S.C. 1829b);
``(B) chapter 2 of title I of Public Law 91-508 (12
U.S.C. 1951 et seq.);
``(C) subchapter II of chapter 53 of title 31,
United States Code; and
``(D) any other applicable requirements and
implementing regulations relating to the prevention of
money laundering and terrorist financing; and
``(5) ensure that composite ratings are determined based on
a transparent methodology that is limited to the objective
criteria established for each CAMELS component.
``(b) Rulemaking.--Not later than 12 months after the Council makes
the recommendations required under subsection (a), the Federal
financial institutions regulatory agencies shall, jointly, issue rules
to carry out the recommendations described under subsection (a).
``(c) Public Comment Period.--In issuing the rules required under
subsection (b), the Federal financial institutions regulatory agencies
shall--
``(1) publish a notice of proposed rulemaking with respect
to such rules; and
``(2) provide for a public comment period of not less than
90 days.
``(d) Rule of Construction.--Nothing in this section may be
construed to limit the authority of the Federal financial institutions
regulatory agencies to take supervisory, adjudicatory, or enforcement
actions to ensure the safety and soundness of financial
institutions.''.
(2) Well managed definition.--Section 2(o)(9)(A) of the
Bank Holding Company Act of 1956 (12 U.S.C. 1841(o)(9)(A)) is
amended--
(A) by striking ``achievement of'' and all that
follows through ``a CAMEL'' and inserting ``achievement
of a CAMEL'';
(B) by striking ``; and'' and inserting a period;
and
(C) by striking clause (ii).
SEC. 302. FAIR AUDITS AND INSPECTIONS FOR REGULATORS' EXAMS.
(a) Timeliness of Examinations and Examination Reports.--The
Federal Financial Institutions Examination Council Act of 1978 (12
U.S.C. 3301 et seq.), as amended by section 301, is further amended by
adding at the end the following:
``SEC. 1013. TIMELINESS OF EXAMINATIONS AND EXAMINATION REPORTS.
``(a) Timeliness of Examinations.--A Federal financial institutions
regulatory agency shall complete any examination of a financial
institution within 270 days of commencing the examination, except that
such period may be extended by the Federal financial institutions
regulatory agency by providing written notice to the financial
institution describing with particularity the reasons that a longer
period is needed.
``(b) Final Examination Report.--A Federal financial institutions
regulatory agency shall provide a final examination report to a
financial institution not later than 90 days after the later of--
``(1) the exit interview for an examination of the
institution; or
``(2) the provision of additional material information by
the institution relating to the examination.
``(c) Exit Interview Requirement.--Within 30 days of completing an
examination, a Federal financial institutions regulatory agency shall
conduct an exit interview with the financial institution's senior
management, except that such period may be extended by the Federal
financial institutions regulatory agency by providing written notice to
the institution and the Board describing with particularity the reasons
that a longer period is needed to complete the exit interview.
``(d) Examination Materials.--Upon the request of a financial
institution, the Federal financial institutions regulatory agency shall
include with the final report an appendix listing all examination or
other factual information relied upon by the agency in support of a
material supervisory determination.''.
(b) Timeliness of Required Permission, Regulatory, and Reporting
Guidance.--The Federal Financial Institutions Examination Council Act
of 1978 (12 U.S.C. 3301 et seq.), as amended by subsection (a), is
further amended by adding at the end the following:
``SEC. 1014. TIMELINESS OF REQUIRED PERMISSION, REGULATORY, AND
REPORTING GUIDANCE.
``(a) Request for Permission or Guidance.--With respect to an
action that a financial institution is taking or is intending to take,
the financial institution may request a written determination by the
applicable Federal financial institutions regulatory agency of--
``(1) the agency's non-objection to the financial
institution conducting a particular activity;
``(2) the agency's interpretation of a law or regulation;
and
``(3) the agency's interpretation of generally accepted
accounting principles or accounting objectives, standards, and
requirements.
``(b) Contents of Request.--A request made under subsection (a)
shall be in writing and contain--
``(1) the nature of the request;
``(2) applicable facts relating to the matter;
``(3) applicable law, regulation, or generally accepted
accounting principles relating to the matter; and
``(4) a summary of the request.
``(c) Response To Request.--A Federal financial institutions
regulatory agency receiving a request under subsection (a) shall, not
later than 30 days after receiving the request--
``(1) provide the financial institution making the request
with written notification that the agency received the request
and stating whether the request contains all of the information
required under subsection (b); and
``(2) if the request does not contain all of the
information required under subsection (b), provide the
financial institution with an explanation of what information
is missing.
``(d) Providing Missing Information.--If a Federal financial
institutions regulatory agency informs the financial institution under
subsection (c) that the request does not contain all the information
required under subsection (b), the financial institution may provide
the missing information to the Federal financial institutions
regulatory agency during the 30-day period beginning on the date the
financial institution receives the explanation of the missing
information under subsection (c).
``(e) Determination.--A Federal financial institutions regulatory
agency receiving a request under subsection (a) shall make a
determination on the request and provide the financial institution with
a written notice of such determination--
``(1) if the initial request contains the information
required under subsection (b), not later than the end of the
60-day period beginning on the date the Federal financial
institutions regulatory agency notifies the financial
institution of the receipt of the request under subsection (c);
or
``(2) if the initial request does not contain the
information required under subsection (b), but the financial
institution provides the missing information during the 30-day
period described under subsection (d), not later than the end
of the 60-day period beginning on the date such missing
information is provided; or
``(3) if the initial request does not contain the
information required under subsection (b), and the financial
institution does not provide the missing information during the
30-day period described under subsection (d), not later than
the end of the 60-day period beginning on the end of such 30-
day period.
``(f) Reports and Publication.--Each Federal financial institutions
regulatory agency shall, within 120 days after making a determination
under paragraph (5), publish a summary of the determination on the
public website of the Federal financial institutions regulatory agency.
Each Federal financial institutions regulatory agency shall redact any
confidential supervisory information about the financial institution,
any identifying facts about the financial institution, and any
sensitive personally identifiable information, and anonymize any un-
redacted information that could, individually or in the aggregate,
identify the financial institution.''.
(c) Office of Independent Examination Review.--
(1) In general.--The Federal Financial Institutions
Examination Council Act of 1978 (12 U.S.C. 3301 et seq.), as
amended by subsection (b), is further amended by adding at the
end the following:
``SEC. 1015. OFFICE OF INDEPENDENT EXAMINATION REVIEW.
``(a) Establishment.--There is established in the Council an Office
of Independent Examination Review (the `Office').
``(b) Board of Independent Examination Review.--
``(1) In general.--The head of the Office shall be the
Board of Independent Examination Review, which shall be
comprised of 3 members, appointed by the President, by and with
the advice and consent of the Senate.
``(2) Qualifications.--The President shall appoint the 1
member of the Board from each of the following classes of
individuals:
``(A) Individuals who have been employed by a
Federal financial institutions regulatory agency.
``(B) Individuals who--
``(i) are a licensed attorney or a
certified public accountant authorized to
practice under the laws of a State, the
District of Columbia, or a territory of the
United States;
``(ii) have either academic or private
sector experience;
``(iii) have relevant work-related
experience in consumer affairs or compliance
with consumer protection laws with respect to
financial institutions; and
``(iv) are not, and were not during the
previous 10-year period, employed by a Federal
banking agency, a Federal reserve bank, or the
National Credit Union Administration.
``(C) Individuals--
``(i) with at least 10 years private sector
financial services senior management-level
experience; and
``(ii) recommended by--
``(I) an insured depository
institution;
``(II) an insured credit union; or
``(III) a trade association for
such institutions or credit unions.
``(3) Prohibition on certain individuals serving as a board
member.--The President may not appoint an individual as a
member of the Board if the individual--
``(A) is, or was during the previous 2-year period,
employed by a Federal financial institutions regulatory
agency or a Federal reserve bank;
``(B) is, or was during the previous 2-year period,
employed by a financial institution; or
``(C) is reporting, or was reporting in the past 5
years, directly or indirectly to a Federal financial
institutions regulatory agency official who makes
material supervisory determinations.
``(4) Consultation.--In appointing members of the Board,
the President shall consult with the Federal financial
institutions regulatory agencies and financial institutions.
``(5) Term.--
``(A) In general.--Each member of the Board shall
serve for a term of 3 years.
``(B) Term limitation.--No individual may serve
more than 2 full terms on the Board.
``(6) Political affiliation.--Not more than 2 members of
the Board shall be members of the same political party.
``(7) Quorum.--
``(A) In general.--3 members of the Board shall
constitute a quorum.
``(B) Initial quorum.--During the 6-month period
beginning on the date of enactment of this section, 1
member of the Board shall constitute a quorum until the
Board has 3 members.
``(c) Staffing.--The Board is authorized to hire staff to support
the activities of the Office of Independent Examination Review. One-
fifth of the costs and expenses of the Office, including the salaries
of its employees, shall be paid by each of the Federal financial
institutions regulatory agencies. Annual assessments for such share
shall be levied by the Council based upon its projected budget for the
year, and additional assessments may be made during the year if
necessary.
``(d) Duties.--The Board shall--
``(1) receive and, at the discretion of the Board,
investigate complaints from financial institutions, their
representatives, or another entity acting on behalf of such
institutions, concerning examinations, examination practices,
or examination reports;
``(2) hold meetings, at least once every three months and
in locations designed to encourage participation from all
sections of the United States, with financial institutions,
their representatives, or another entity acting on behalf of
such institutions, to discuss examination procedures,
examination practices, or examination policies;
``(3) review examination procedures of the Federal
financial institutions regulatory agencies to ensure that the
written examination policies of those agencies are being
followed in practice and adhere to the standards for
consistency;
``(4) conduct a continuing and regular program of
examination quality assurance for all examination types
conducted by the Federal financial institutions regulatory
agencies;
``(5) carry out an independent review of any supervisory
appeal initiated under section 1016; and
``(6) report annually to the Committee on Financial
Services of the House of Representatives, the Committee on
Banking, Housing, and Urban Affairs of the Senate, and the
Council, on the reviews carried out pursuant to paragraphs (3)
and (5), including compliance with the requirements set forth
in section 1014 regarding timeliness of examination reports,
and the Board's recommendations for improvements in examination
procedures, practices, and policies.
``(e) Confidentiality.--The Board and the Council shall keep
confidential--
``(1) all meetings, discussions, and information provided
by financial institutions and Federal financial institutions
regulatory agencies that involve confidential supervisory
information or privileged information;
``(2) all information and communications exchanged between
a financial institution and the Office of Independent
Examination Review; and
``(3) all information and communications exchanged between
a Federal financial institutions regulatory agency and the
Office of Independent Examination Review.''.
(2) Definitions.--Section 1003 of the Federal Financial
Institutions Examination Council Act of 1978 (12 U.S.C. 3302)
is amended--
(A) in paragraph (2), by striking ``and'' at the
end; and
(B) by adding at the end the following:
``(4) the term `Board' means the Board of Independent
Examination Review established under section 1015(b);
``(5) the term `material supervisory determination' has the
meaning given such term in section 309(c) of the Riegle
Community Development and Regulatory Improvement Act of 1994;
``(6) the term `insured depository institution' has the
meaning given that term in section 3 of the Federal Deposit
Insurance Act; and
``(7) the term `insured credit union' has the meaning given
that term in section 101 of the Federal Credit Union Act.''.
(d) Right to Independent Review of Material Supervisory
Determinations.--The Federal Financial Institutions Examination Council
Act of 1978 (12 U.S.C. 3301 et seq.), as amended by subsection (c), is
further amended by adding at the end the following:
``SEC. 1016. RIGHT TO INDEPENDENT REVIEW OF MATERIAL SUPERVISORY
DETERMINATIONS.
``(a) In General.--A financial institution shall have the right to
obtain an independent review, as described in this section, of a
material supervisory determination contained in a final report of
examination.
``(b) Notice.--
``(1) Timing.--A financial institution seeking review of a
material supervisory determination under this section shall
file a written notice with the Board within 60 days after
receiving the final report of examination that is the subject
of such review.
``(2) Extension.--The institution may file a written
request with the Board for an extension of the 60-day time
period described under paragraph (1), which shall state good
cause for granting the extension. Such request shall be granted
in the sole discretion of the Board.
``(3) Identification of determination.--The written notice
shall--
``(A) identify the material supervisory
determination that is the subject of the requested
independent examination review;
``(B) state the reasons why the institution
believes that the material supervisory determination is
incorrect or should otherwise be modified; and
``(C) include--
``(i) a clear and complete statement of all
relevant facts and issues;
``(ii) all arguments that the institution
wishes to present; and
``(iii) all relevant and material documents
in the possession of the institution that the
institution wishes to be considered.
``(4) Information made available to institution.--An
institution seeking an appeal of a material supervisory
determination may, not later than 7 days after receiving the
final examination report, request that the Federal financial
institutions regulatory agency that made the material
supervisory determination provide the institution with all
examination and factual information relied upon by the agency
in making the material supervisory determination. The agency
shall provide that information to the institution not later
than 14 days after receiving the request.
``(c) Determination; Right to Hearing.--
``(1) In general.--The Board shall--
``(A) determine the merits of the appeal on the
record, including whether the material supervisory
determination being appealed should be upheld,
canceled, or modified; or
``(B) at the election of the financial institution,
conduct a hearing, which shall take place not later
than 60 days after the petition for review is received
by the Board.
``(2) Right to obtain testimony.--A financial institution
electing for a hearing under paragraph (1)(B) shall have the
right the obtain testimony under oath from agency employees and
obtain documents and other evidence at the hearing, or in
advance of the hearing, according to procedures instituted by
the Board consistent with those set forth under sections 556
and 557 of title 5, United States Code.
``(3) Basis of decision.--The Board shall issue a written
decision based upon the record of the examination, supplemented
by the record established at any hearing.
``(4) Standard of review.--The Board's review of a material
supervisory determination being appealed under this subsection
shall be de novo, and the Board shall not defer to the opinions
of the examiner or agency, but shall independently determine
the appropriateness of the agency's material supervisory
determination based upon the relevant statutes, regulations,
other appropriate guidance, and the evidentiary record.
``(d) Final Decision.--A decision by the Board on an independent
review under this section shall--
``(1) be made not later than 60 days after the record has
been closed; and
``(2) be deemed final agency action and shall bind the
agency whose supervisory determination was the subject of the
review and the financial institution requesting the review.
``(e) Right to Judicial Review.--A financial institution shall have
the right to petition for review of a Board determination made under
subsection (d) by filing a petition for review not later than 60 days
after the date on which the decision is made in the United States Court
of Appeals for the District of Columbia Circuit or the Circuit in which
the financial institution is located.
``(f) Referral of Violations.--If the Board, in carrying out this
section, determines that a financial institution has violated a law or
regulation, the Board shall refer such determination to the applicable
Federal financial institutions regulatory agency.
``(g) Annual Report.--
``(1) In general.--The Board shall report annually to the
Committee on Financial Services of the House of
Representatives, the Committee on Banking, Housing, and Urban
Affairs of the Senate, and the Council on actions taken under
this section, including the types of issues that the Board has
reviewed and the results of those reviews, including
information on each final determination with respect to a
material supervisory determination.
``(2) Confidentiality.--In reporting under paragraph (1),
the Board shall redact information about individual financial
institutions and any confidential supervisory information or
privileged information shared by financial institutions, and
shall anonymize any un-redacted information that could, in the
aggregate, identify a financial institution.
``(h) Retaliation Prohibited.--
``(1) In general.--A Federal financial institutions
regulatory agency may not--
``(A) retaliate against a financial institution,
including service providers, or any institution-
affiliated party, for exercising appellate rights under
this section; or
``(B) delay or deny any agency action that would
benefit a financial institution or any institution-
affiliated party on the basis that an appeal under this
section is pending under this section.
``(2) Retaliation.--For purposes of this subsection,
retaliation includes delaying consideration of, or withholding
approval of, any request, notice, or application that otherwise
would have been approved, but for the exercise of a financial
institution's rights under this section.
``(i) Rulemaking.--The Board shall issue rules to establish
procedures for hearings described under this section, including that--
``(1) a financial institution may appear at the hearing
personally or through counsel;
``(2) a financial institution may provide an oral and
written presentation at the hearing;
``(3) the Board may ask questions of any person
participating in the hearing;
``(4) the hearing may not involve--
``(A) a cross-examination; or
``(B) discovery;
``(5) the hearing shall not be governed by the Federal
Rules of Evidence; and
``(6) the Board shall have a verbatim transcript of the
hearing prepared.
``(j) Safety and Soundness Exception.--The appeal of a material
supervisory determination by a financial institution under this section
shall not affect the authority of a Federal financial institutions
regulatory agency during the pendency of such appeal to enforce the
material supervisory determination or to take an action based on such
material supervisory determination, if the Federal financial
institutions regulatory agency determines that such enforcement or
action is necessary to ensure the immediate safety and soundness of the
financial institution.''.
(e) Additional Amendments.--
(1) Regulator appeals process, ombudsman, and alternative
dispute resolution.--
(A) In general.--Section 309 of the Riegle
Community Development and Regulatory Improvement Act of
1994 (12 U.S.C. 4806) is amended--
(i) in the heading, by striking
``regulatory appeals process, ombudsman,'' and
inserting ``ombudsman'' (and by conforming the
item relating to such section in the table of
contents accordingly);
(ii) by striking subsections (a), (b), and
(c);
(iii) by redesignating subsections (d),
(e), (f), and (g) as subsections (a), (b), (c),
and (d), respectively;
(iv) in subsection (b), as so
redesignated--
(I) in paragraph (2)--
(aa) in subparagraph (B),
by striking ``and'' at the end;
(bb) in subparagraph (C),
by striking the period and
inserting ``; and''; and
(cc) by adding at the end
the following:
``(D) ensure that appropriate safeguards exist for
protecting any party from retaliation by any agency for
exercising rights under this subsection.''; and
(II) by adding at the end the
following:
``(6) Retaliation.--For purposes of this subsection,
retaliation includes delaying consideration of, or withholding
approval of, any request, notice, or application that otherwise
would have been approved, but for the exercise of a financial
institution's rights under this section.''; and
(v) in paragraph (1)(A) of subsection (c),
as so redesignated--
(I) in clause (ii), by striking ``;
and'' and inserting a semicolon;
(II) in clause (iii), by striking
``; and'' and inserting a semicolon;
and
(III) by adding at the end the
following:
``(iv) any issue specifically listed in an
exam report as a matter requiring attention by
the institution's management or board of
directors; and
``(v) any suspension or removal of an
institution's status as eligible for expedited
processing of applications, requests, notices,
or filings on the grounds of a supervisory or
compliance concern, regardless of whether that
concern has been cited as a basis for a
material supervisory determination or matter
requiring attention in an examination report,
provided that the conduct at issue did not
involve violation of any criminal law; and''.
(B) Effect.--Nothing in this subsection affects the
authority of an appropriate Federal banking agency or
the National Credit Union Administration Board to take
enforcement or other supervisory action.
(2) Federal credit union act.--Section 205(j) of the
Federal Credit Union Act (12 U.S.C. 1785(j)) is amended by
inserting ``the Bureau of Consumer Financial Protection,''
before ``the Administration'' each place that term appears.
(3) Federal financial institutions examination council
act.--The Federal Financial Institutions Examination Council
Act of 1978 (12 U.S.C. 3301 et seq.) is amended--
(A) in section 1003 (12 U.S.C. 3302)--
(i) by striking paragraph (1) and inserting
the following:
``(1) the term `Federal financial institutions regulatory
agencies'--
``(A) means the Office of the Comptroller of the
Currency, the Board of Governors of the Federal Reserve
System, the Federal Deposit Insurance Corporation, and
the National Credit Union Administration; and
``(B) includes the Bureau of Consumer Financial
Protection for purposes of sections 1012 through
1015;''; and
(ii) in paragraph (3), by striking the
semicolon at the end and inserting ``, except
that for purposes of sections 1013 through
1016, the term `financial institution' does not
include a credit union that is not an insured
credit union;'';
(B) in section 1004(a)(4) (12 U.S.C. 3303), by
striking ``Consumer Financial Protection Bureau'' and
inserting ``Bureau of Consumer Financial Protection'';
and
(C) in section 1005 (12 U.S.C. 3304)--
(i) by striking ``One-fifth'' and inserting
``One-fourth''; and
(ii) by inserting ``described under section
1003(1)(A)'' after ``agencies''.
SEC. 303. SUPERVISORY MODIFICATIONS FOR APPROPRIATE RISK-BASED TESTING.
(a) Examination Relief for Certain Well Managed and Well
Capitalized Financial Institutions.--
(1) 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 described under
subparagraph (A), 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.''.
(2) 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.''.
(b) Examination Practices.--
(1) Insured depository institutions.--Section 10(d) of the
Federal Deposit Insurance Act (12 U.S.C. 1820(d)), as amended
by subsection (a)(1), is further amended by adding at the end
the following:
``(12) Examination practices.--With respect to on-site
examination of an insured depository institution with less than
$6,000,000,000 in total assets, the appropriate Federal banking
agency shall--
``(A) ensure the examination is led by, to the
maximum extent practicable, an examiner with
significant experience as an examiner;
``(B) make every effort, to the maximum extent
practicable, to minimize the number of examiners
utilized and the amount of time spent at the
institution to carry out the examination;
``(C) make every effort, to the maximum extent
practicable, to schedule the examination at a time that
is convenient for the institution; and
``(D) to the maximum extent practicable, give the
institution advance notice of issues expected to be
covered in the examination.
``(13) Report.--In its annual report to Congress, each
Federal banking agency shall include--
``(A) information on how the agency is complying
with paragraphs (11) and (12); and
``(B) aggregate data summarizing the agency's
examination practices with respect to insured
depository institutions with less than $6,000,000,000
in total assets, including--
``(i) the average experience of examiners,
including the average number of years of
examiner experience of those who lead on-site
examinations;
``(ii) the average number of examiners
utilized; and
``(iii) the average amount of time the
agency spends visiting such institutions for
on-site examinations.''.
(2) Insured credit unions.--Section 204 of the Federal
Credit Union Act (12 U.S.C. 1784), as amended by subsection
(a)(2), is further amended by adding at the end the following:
``(i) Examination Practices.--With respect to on-site examination
of an insured credit union with less than $6,000,000,000 in total
assets, the National Credit Union Administration shall--
``(1) ensure the examination is led by, to the maximum
extent practicable, an examiner with significant experience as
an examiner;
``(2) make every effort, to the maximum extent practicable,
to minimize the number of examiners utilized and the amount of
time spent at the credit union to carry out the examination;
``(3) make every effort, to the maximum extent practicable,
to schedule the examination at a time that is convenient for
the credit union; and
``(4) to the maximum extent practicable, give the credit
union advance notice of issues expected to be covered in the
examination.
``(j) Report.--In its annual report to Congress, the National
Credit Union Administration shall include--
``(1) information on how the Administration is complying
with subsections (h) and (i); and
``(2) aggregate data summarizing the Administration's
examination practices with respect to insured credit unions
with less than $6,000,000,000 in total assets, including--
``(A) the average experience of examiners,
including the average number of years of examiner
experience of those who lead on-site examinations;
``(B) the average number of examiners utilized; and
``(C) the average amount of time the Administration
spends visiting such credit unions for on-site
examinations.''.
SEC. 304. TAILORED REGULATORY UPDATES FOR SUPERVISORY TESTING.
Section 10(d) of the Federal Deposit Insurance Act (12 U.S.C.
1820(d)) is amended--
(1) in paragraph (4)(A), by striking ``$3,000,000,000'' and
inserting ``$6,000,000,000''; and
(2) in paragraph (10), by striking ``$3,000,000,000'' and
inserting ``$6,000,000,000''.
SEC. 305. STRESS TESTING ACCOUNTABILITY AND TRANSPARENCY.
(a) Rulemaking Related to Stress Capital Buffer Requirements.--
(1) In general.--Not later than 90 days after the date of
the enactment of this section, the Board of Governors of the
Federal Reserve System (in this section referred to as the
``Board'') shall issue a rule--
(A) establishing the models, assumptions, formulas,
and other decisional methodologies that are used to
conduct any stress test pursuant to section 165(i) of
the Financial Stability Act of 2010 (12 U.S.C.
5365(i)), including any such test that is used to
determine any component or subcomponent of the stress
capital buffer requirement for a covered company; and
(B) to determine, where the Board has supervisory
stress test results from two or more periodic analyses
of a covered company, the covered company's stress
capital buffer requirement on the basis of supervisory
stress test results from two or more periodic analyses
of that covered company.
(2) Changes.--The Board may only make material changes to
the methodologies established in the rule issued under
paragraph (1)(A) through notice and comment rulemaking.
(3) No double-count.--The Board shall ensure no double-
count of capital requirements for the same risks in the stress
capital buffer requirement and the risk-based capital
requirements.
(4) Definitions.--In this subsection:
(A) Covered company.--The term ``covered company''
means a company to which section 225.8 of title 12,
Code of Federal Regulations, or section 238.170 of
title 12, Code of Federal Regulations, applies.
(B) Stress capital buffer requirement.--The term
``stress capital buffer requirement'' has the meaning
given that term under--
(i) section 225.8(d) of title 12, Code of
Federal Regulations; and
(ii) section 238.170(d) of title 12, Code
of Federal Regulations.
(5) Rule of construction.--Nothing in this subsection may
be construed to imply that the Board is required to establish a
stress capital buffer requirement for any bank holding company
or any other company regulated by the Board.
(b) Rulemaking Relating to Stress Testing.--
(1) In general.--Beginning in the first calendar year
beginning after the date of the enactment of this section, the
Board shall, not less than 60 days before conducting a stress
test pursuant to section 165(i) of the Financial Stability Act
of 2010, publicly disclose each scenario to be used in such
stress test.
(2) Prohibition.--The Board may not, by rule or otherwise,
subject any nonbank financial company or bank holding company
to a climate-related stress test using the authority provided
in section 165(i) of the Financial Stability Act of 2010.
(c) GAO Report.--
(1) In general.--The Comptroller General of the United
States shall, every 3 years, conduct a study and submit a
report to the Congress with respect to the stress tests
conducted by the Board under section 165(i) of the Financial
Stability Act of 2010 in the 3 most recent calendar years.
(2) Contents.--The report submitted to the Congress under
paragraph (1) shall consider the effectiveness of the stress
tests in evaluating--
(A) the safety and soundness of the nonbank
financial companies and bank holding companies
subjected to stress tests; and
(B) the stability of the United States financial
system.
SEC. 306. COMMUNITY BANK REPRESENTATION.
(a) Federal Reserve Act.--Section 10 of the Federal Reserve Act is
amended--
(1) in the first undesignated paragraph (12 U.S.C. 241), by
striking ``having less than $10,000,000,000 in total assets'';
(2) in the second undesignated paragraph (12 U.S.C. 242),
by inserting after ``regulation of such firms.'' the following:
``The Chairman shall select one member of the Board with
demonstrated primary experience working in or supervising
community banks to, in consultation with the Vice Chairman for
Supervision and any other member of the Board with demonstrated
primary experience working in or supervising community banks,
develop policy recommendations for the Board regarding
supervision and regulation of banking organizations supervised
by the Board having less than $17,000,000,000 in total assets,
and to oversee the supervision and regulation of such banking
organizations in consultation with the Vice Chairman for
Supervision and any other member of the Board with demonstrated
primary experience working in or supervising community
banks.'';
(3) in paragraph (12) (12 U.S.C. 247b)--
(A) by striking ``The Vice Chairman for
Supervision'' and inserting the following:
``(A) Vice chairman for supervision.--The Vice
Chairman for Supervision'';
(B) by striking ``and at'' and inserting ``at'';
and
(C) by adding at the end the following:
``(B) Community bank member.--The member of the
Board with demonstrated primary experience working in
or supervising community banks selected by the Chairman
to develop policy recommendations for the Board
regarding supervision and regulation of banking
organizations supervised by the Board having less than
$17,000,000,000 in total assets, and to oversee the
supervision and regulation of such banking
organizations, if different than the Vice Chairman for
Supervision, shall appear before the Committee on
Banking, Housing, and Urban Affairs of the Senate and
the Committee on Financial Services of the House of
Representatives at semi-annual hearings regarding the
efforts, activities, objectives, and plans of the Board
with respect to the conduct of supervision and
regulation of banking organizations supervised by the
Board having less than $17,000,000,000 in total
assets.''; and
(4) by adding at the end the following:
``(13) Member of the board for community banks annual
threshold adjustment.--
``(A) In general.--At the end of each year for
which the nominal gross domestic product of the United
States increases (a `covered year'), the Board shall
adjust each dollar figure described in the second
undesignated paragraph of this section, paragraph
(12)(B) of this section, and section 1004(a)(3) of the
Federal Financial Institutions Examination Council Act
of 1978 by a percentage equal to the percentage
increase (if any) between--
``(i) the nominal gross domestic product of
the United States for the year, during the
preceding 5 years, with respect to which the
nominal gross domestic product of the United
States was the highest; and
``(ii) the nominal gross domestic product
of the United States for the covered year.
``(B) Determination of gdp.--In this paragraph, the
Board shall use nominal gross domestic product
statistics determined by the Bureau of Economic
Analysis.''.
(b) Federal Financial Institutions Examination Council Act of
1978.--Section 1004(a)(3) of the Federal Financial Institutions
Examination Council Act of 1978 (12 U.S.C. 3303(a)(3)) is amended by
adding at the end the following: ``and such Governor shall consult with
the Governor with demonstrated primary experience working in or
supervising community banks selected by the Chairman of the Board to
develop policy recommendations for the Board regarding supervision and
regulation of banking organizations supervised by the Board having less
than $17,000,000,000 in total assets, and to oversee the supervision
and regulation of such banking organizations,''.
SEC. 307. FINANCIAL INTEGRITY AND REGULATION MANAGEMENT.
(a) Findings.--Congress finds that--
(1) the primary objective of financial regulation and
supervision by the Federal banking agencies is to promote
safety and soundness of depository institutions;
(2) all federally legal businesses and law-abiding citizens
regardless of political ideology should have equal opportunity
to obtain financial services and should not face unlawful
discrimination in obtaining such services;
(3) financial service providers are private entities
entitled to provide services to whichever customers they so
choose, provided that those decisions do not violate the law;
(4) financial service providers should strive to ensure
that all business decisions are based on factors free from
unlawful prejudice or political influence;
(5) the use of reputational risk in supervisory frameworks
encourages Federal banking agencies to regulate depository
institutions based on the subjective view of negative publicity
and provides cover for the agencies to implement their own
political agenda unrelated to the safety and soundness of a
depository institution;
(6) Federal banking agencies have in fact used reputational
risk to limit access of federally legal businesses and law-
abiding citizens to financial services in 2018 when the Federal
Deposit Insurance Corporation acknowledged that the agency used
reputational risk reviews to limit access to financial services
by certain industries, commonly known as ``Operation Choke
Point''; and
(7) reputational risk does not appear in any statute and is
an unnecessary and improper use of supervisory authority that
does not contribute to the safety and soundness of the
financial system.
(b) Definitions.--In this section:
(1) Depository institution.--The term ``depository
institution''--
(A) has the meaning given the term in section 3 of
the Federal Deposit Insurance Act (12 U.S.C. 1813);
(B) includes a depository institution holding
company, as such term is defined in section 3 of the
Federal Deposit Insurance Act (12 U.S.C. 1813); and
(C) includes an insured credit union, as such term
is defined in section 101 of the Federal Credit Union
Act (12 U.S.C. 1752).
(2) Federal banking agency.--The term ``Federal banking
agency''--
(A) has the meaning given the term in section 3 of
the Federal Deposit Insurance Act (12 U.S.C. 1813); and
(B) includes--
(i) the National Credit Union
Administration; and
(ii) the Bureau of Consumer Financial
Protection.
(3) Foreign terrorist organization.--The term ``foreign
terrorist organization'' means a foreign organization that is
designated by the Secretary of State in accordance with section
219 of the Immigration and Nationality Act (8 U.S.C. 1189).
(4) Reputational risk.--The term ``reputational risk''
means the potential that negative publicity or negative public
opinion regarding a depository institution's business
practices, whether true or not, will cause a decline in
confidence in the institution or a decline in the customer
base, costly litigation, or revenue reductions or otherwise
adversely impact the depository institution. The previous
sentence does not apply to negative publicity or negative
public opinion regarding an institution's business practices
where such practices involve unlawful transactions in
connection with state sponsors of terrorism or foreign
terrorist organizations.
(5) State sponsors of terrorism.--The term ``state sponsors
of terrorism'' means a country, the government of which has
been determined by the Secretary of State to have repeatedly
provided support for acts of international terrorism, for
purposes of--
(A) section 1754(c)(1)(A)(i) of the Export Control
Reform Act of 2018 (50 U.S.C. 4813(c)(1)(A)(i));
(B) section 620A of the Foreign Assistance Act of
1961 (22 U.S.C. 2371);
(C) section 40(d) of the Arms Export Control Act
(22 U.S.C. 2780(d)); or
(D) any other provision of law.
(c) Removal of Reputational Risk as a Consideration in the
Supervision of Depository Institutions.--Each Federal banking agency
shall remove from any guidance, rule, examination manual, or similar
document established by the agency any reference to reputational risk,
or any term substantially similar, regarding the supervision of
depository institutions such that reputational risk, or any term
substantially similar, is no longer taken into consideration by the
Federal banking agency when examining and supervising a depository
institution.
(d) Prohibition.--No Federal banking agency may engage in any
activity concerning or related to the regulation, supervision, or
examination of the reputational risk, or any term substantially
similar, or the management thereof, of a depository institution,
including--
(1) establishing any rule, regulation, requirement,
standard, or supervisory expectation concerning or related to
the reputational risk, or any term substantially similar, or
the management thereof, of a depository institution whether
binding or not;
(2) conducting any examination, assessment, data
collection, or other supervisory exercise concerning or related
to reputational risk, or any term substantially similar, or the
management thereof, of a depository institution;
(3) issuing any examination finding, supervisory criticism,
or other supervisory or examination communication concerning or
related to reputational risk, or any term substantially
similar, or the management thereof, of a depository
institution;
(4) making any supervisory ratings decision or
determination that is based, in whole or in part, on any matter
concerning or related to reputational risk, or any term
substantially similar, or the management thereof, of a
depository institution; and
(5) taking any formal or informal enforcement action that
is based, in whole or in part, on any matter concerning or
related to reputational risk, or any term substantially
similar, or the management thereof, of a depository
institution.
(e) Reports.--Not later than 180 days after the date of enactment
of this Act, each Federal banking agency shall submit to the Committee
on Banking, Housing, and Urban Affairs of the Senate and the Committee
on Financial Services of the House of Representatives a report that--
(1) confirms implementation of this section; and
(2) describes any changes made to internal policies as a
result of this section.
TITLE IV--REGULATORY ACCOUNTABILITY AND TRANSPARENCY
SEC. 401. FDIC BOARD ACCOUNTABILITY.
Section 2 of the Federal Deposit Insurance Act (12 U.S.C. 1812) is
amended--
(1) in subsection (a)--
(A) in paragraph (1)--
(i) in subparagraph (A), by adding ``and''
at the end; and
(ii) by striking subparagraphs (B) and (C)
and inserting the following:
``(B) 4 of whom shall be appointed by the
President, by and with the advice and consent of the
Senate, from among individuals who are citizens of the
United States, 1 of whom shall have State bank
supervisory experience, and separately 1 of whom shall
have demonstrated primary experience working in or
supervising depository institutions having less than
$17,000,000,000 in total assets.''; and
(B) by adding at the end the following:
``(3) Non-voting status of the director of the bureau of
consumer financial protection.--The Director of the Bureau of
Consumer Financial Protection shall serve as a non-voting
observer to the Board of Directors of the Corporation.'';
(2) in subsection (c)--
(A) in paragraph (1), by adding at the end the
following: ``No individual may be appointed as a member
for more than two terms.''; and
(B) by adding at the end the following:
``(4) Maximum length of service.--Notwithstanding any other
provision of this Act, no person shall serve as a member for
more than twelve years in total.'';
(3) in subsection (d)(2)--
(A) by striking ``Consumer Financial Protection
Bureau'' each place such term appears and inserting
``Bureau of Consumer Financial Protection''; and
(B) by inserting ``or observer, as the case may
be,'' after ``member''; and
(4) in subsection (f)(2), by striking ``or of the Consumer
Financial Protection Bureau''.
SEC. 402. STOP AGENCY FIAT ENFORCEMENT OF GUIDANCE.
(a) In General.--The head of each financial agency shall include a
guidance clarity statement as described in subsection (b) on any
guidance issued by that financial agency on and after the date of the
enactment of this Act.
(b) Guidance Clarity Statement.--A guidance clarity statement
required under subsection (a) shall be displayed prominently on the
first page of the document and shall include the following: ``This
guidance does not have the force and effect of law and therefore does
not establish any rights or obligations for any person and is not
binding on the agency or the public. If this guidance suggests how
regulated entities may comply with applicable statutes or regulations,
noncompliance with this guidance does not conclusively establish a
violation of applicable law.''.
(c) Definitions.--In this section:
(1) Financial agency.--The term ``financial agency'' means
the following:
(A) The Bureau of Consumer Financial Protection.
(B) The Department of Housing and Urban
Development.
(C) The Department of the Treasury.
(D) The Federal Deposit Insurance Corporation.
(E) The Federal Housing Finance Agency.
(F) The Board of Governors of the Federal Reserve
System.
(G) The National Credit Union Administration.
(H) The Office of the Comptroller of the Currency.
(I) The Securities and Exchange Commission.
(2) Guidance.--The term ``guidance'' means a financial
agency statement of general applicability, intended to have a
future effect on the behavior of regulated parties, that sets
forth a policy on a statutory, regulatory, or technical issue,
or an interpretation of a statute or regulation, but does not
include--
(A) a rule promulgated pursuant to notice and
comment under section 553 of title 5, United States
Code;
(B) a rule exempt from rulemaking requirements
under section 553(a) of title 5, United States Code;
(C) a rule of financial agency organization,
procedure, or practice under section 553(b)(A) of title
5, United States Code;
(D) a decision of a financial agency adjudication
under section 554 of title 5, United States Code, or
any similar statutory provision;
(E) internal guidance directed to the issuing
financial agency or other agency that is not intended
to have a substantial future effect on the behavior of
regulated parties; or
(F) internal executive branch legal advice or legal
opinions addressed to executive branch officials.
SEC. 403. REGULATORY EFFICIENCY, VERIFICATION, ITEMIZATION, AND
ENHANCED WORKFLOW.
Section 2222 of the Economic Growth and Regulatory Paperwork
Reduction Act of 1996 (12 U.S.C. 3311) is amended--
(1) by striking ``appropriate Federal banking agency'' each
place such term appears and inserting ``Federal financial
institutions regulatory agency'';
(2) by striking ``appropriate Federal banking agencies''
each place such term appears and inserting ``Federal financial
institutions regulatory agencies'';
(3) in subsection (a)--
(A) by striking ``represented on the Council''; and
(B) by striking ``once every 10 years'' and
inserting ``once every 7 years'';
(4) in subsection (b)--
(A) by redesignating paragraphs (1) and (2) as
subparagraphs (A) and (B), respectively (and adjusting
the margins accordingly);
(B) by striking ``In conducting'' and inserting the
following:
``(1) Solicitation of public comment.--In conducting''; and
(C) by adding at the end the following:
``(2) Internal review of cumulative impact.--Each Federal
financial institutions regulatory agency shall conduct an
internal review of the cumulative impact of regulations issued
by the Federal financial institutions regulatory agency that--
``(A) assesses the effects of such regulations on
consumers' access to financial products and services;
``(B) assesses the effects of such regulations on
the availability of financial products and services to
financial and nonfinancial firms;
``(C) assesses the impact of such regulations on
credit availability and financial market liquidity in
United States financial markets;
``(D) assesses the balance of benefits and costs of
such regulations with respect to the safety and
soundness of the United States financial system and
overall economic activity in the United States;
``(E) to the extent practicable, quantifies the
direct and indirect economic costs imposed by such
regulations; and
``(F) includes recommendations to streamline,
simplify, or eliminate duplicative, outdated, and
unnecessarily burdensome regulations.'';
(5) in subsection (c)--
(A) by striking ``subsection (b)(2)'' and inserting
``subsection (b)(1)(B), and the internal review under
subsection (b)(2),''; and
(B) by striking ``once every 10 years'' and
inserting ``once every 7 years'';
(6) in subsection (e)--
(A) in paragraph (1), by striking ``and'' at the
end;
(B) by redesignating paragraph (2) as paragraph
(3);
(C) by inserting after paragraph (1) the following:
``(2) a summary of the findings and determinations of each
Federal financial institutions regulatory agency of the
internal review conducted by the Federal financial institutions
regulatory agency under subsection (b)(2); and''; and
(D) in paragraph (3), as so redesignated, by
striking ``the regulatory burdens associated with such
issues by regulation'' and inserting ``the regulatory
burdens associated with the issues identified by public
comments received by the Council and the Federal
financial institutions regulatory agencies, as well as
the regulatory burdens identified by each Federal
financial institutions regulatory agency through the
internal reviews conducted under subsection (b)(2), by
regulation''; and
(7) by adding at the end the following:
``(f) Federal Financial Institutions Regulatory Agency Defined.--
The term `Federal financial institutions regulatory agency' has the
meaning given that term in section 1003 of the Federal Financial
Institutions Examination Council Act of 1978 (12 U.S.C. 3302).''.
SEC. 404. AMERICAN FINANCIAL INSTITUTION REGULATORY SOVEREIGNTY AND
TRANSPARENCY.
(a) Annual Reporting on Interactions Between Federal Banking
Supervisory Agencies and Global Financial Regulatory or Supervisory
Forums.--
(1) Board of governors of the federal reserve system.--The
seventh undesignated paragraph of section 10 of the Federal
Reserve Act (12 U.S.C. 247) is amended--
(A) by striking ``The Board'' and inserting the
following:
``(7) Annual report.--
``(A) In general.--The Board'';
(B) by striking the second sentence; and
(C) by adding at the end the following:
``(B) Interactions with global financial regulatory
or supervisory forums.--The report required under
subparagraph (A) shall include a description of the
Board's interactions with global financial regulatory
or supervisory forums, including--
``(i) a list of the global financial
regulatory or supervisory forums in which the
Board maintained membership during the period
covered by the report; and
``(ii) for each such global financial
regulatory or supervisory forum in the list
provided pursuant to clause (i)--
``(I) a description of the general
purposes of the global financial
regulatory or supervisory forum,
including a list of the current members
and observers of the global financial
regulatory or supervisory forum;
``(II) a discussion of how the
general purposes of the global
financial regulatory or supervisory
forum align with the purposes of this
Act and the other Acts that the Board
implements;
``(III) an identification of the
sources that provided a material amount
of funding for the operations of the
global financial regulatory or
supervisory forum during the period
covered by the report;
``(IV) a description of the
organization the Board maintained
during the period covered by the report
to conduct interactions with the global
financial regulatory or supervisory
forum, including an organizational
chart and an identification of the
official staff of the Board with
oversight responsibility for
interactions with the global financial
regulatory or supervisory forum;
``(V) a discussion of the financial
regulatory or supervisory standard-
setting issues under discussion at the
global financial regulatory or
supervisory forum during the period
covered by the report;
``(VI) a description of the
positions taken by representatives of
the Board at the global financial
regulatory or supervisory forum during
the period covered by the report,
including the rationale, objectives,
and potential impacts of such
positions;
``(VII) a summary of the meetings
attended by representatives of the
Board at the global financial
regulatory or supervisory forum during
the period covered by the report,
including a discussion of the key
outcomes from such meetings;
``(VIII) the text of any final
policies, standards, or recommendations
adopted by the global financial
supervisory or regulatory forum during
the period covered by the report,
including any implementing material,
annex, appendix, side letter, or
similar document entered into
contemporaneously or in conjunction
with the underlying policy, standard,
or recommendation, or an identification
of a publicly available source for the
text of such policy, standard,
recommendation, or implementing
material;
``(IX) a description of any
amendments to Federal statutes,
regulations of the Board, guidance of
the Board, or changes to the Board's
supervisory practices the Board
anticipates will be necessary to
implement any final policies,
standards, or recommendations adopted
by the global financial supervisory or
regulatory forum during the period
covered by the report;
``(X) a discussion of rules
proposed, rules under consideration,
final rules adopted, guidance proposed,
guidance under consideration, final
guidance adopted, or any other similar
actions taken by the Board during the
period covered by the report to
implement agreements of the global
financial regulatory or supervisory
forum, including an economic impact
analysis and a justification for why
the expected costs of implementing
actions are at least offset by the
expected benefits related to economic,
national security, financial stability,
or other national interests; and
``(XI) such other information
relating to interactions with the
global financial regulatory or
supervisory forum during the period
covered by the report separately
requested in writing by the Committee
on Banking, Housing, and Urban Affairs
of the Senate or the Committee on
Financial Services of the House of
Representatives.
``(C) Global financial regulatory or supervisory
forum defined.--
``(i) In general.--In this paragraph, the
term `global financial regulatory or
supervisory forum' means any association or
union of nations through or by which two or
more foreign authorities engage in some aspect
of their conduct of international affairs
regarding financial supervision and regulation,
including--
``(I) the Bank for International
Settlements;
``(II) the Basel Committee on
Banking Supervision;
``(III) the Financial Stability
Board;
``(IV) the International
Association of Insurance Supervisors;
and
``(V) the Network of Central Banks
and Supervisors for Greening the
Financial System.
``(ii) Exception.--The term `global
financial regulatory or supervisory forum' does
not include--
``(I) international financial
institutions, as defined in section
1701(c)(2) of the International
Financial Institutions Act (22 U.S.C.
262r(c)(2)); or
``(II) any international
organization with respect to which the
Board participates pursuant to a treaty
to which the United States is a
party.''.
(2) Office of the comptroller of the currency.--
(A) In general.--The second section 333 of the
Revised Statutes of the United States (12 U.S.C. 14;
relating to an annual report) is amended to read as
follows:
``SEC. 333. REPORT OF COMPTROLLER.
``(a) In General.--The Comptroller of the Currency shall make an
annual report to Congress.
``(b) Interactions With Global Financial Regulatory or Supervisory
Forums.--The report required under subsection (a) shall include a
description of the Comptroller's interactions with global financial
regulatory or supervisory forums, including--
``(1) a list of the global financial regulatory or
supervisory forums in which the Comptroller maintained
membership during the period covered by the report; and
``(2) for each such global financial regulatory or
supervisory forum in the list provided pursuant to paragraph
(1)--
``(A) a description of the general purposes of the
global financial regulatory or supervisory forum,
including a list of the current members and observers
of the global financial regulatory or supervisory
forum;
``(B) a discussion of how the general purposes of
the global financial regulatory or supervisory forum
align with the purposes of this chapter, title LXII,
and the other Acts that the Comptroller implements;
``(C) an identification of the sources that
provided a material amount of funding for the
operations of the global financial regulatory or
supervisory forum during the period covered by the
report;
``(D) a description of the organization the
Comptroller maintained during the period covered by the
report to conduct interactions with the global
financial regulatory or supervisory forum, including an
organizational chart and an identification of the
official staff of the Office of the Comptroller of the
Currency with oversight responsibility for interactions
with the global financial regulatory or supervisory
forum;
``(E) a discussion of the financial regulatory or
supervisory standard-setting issues under discussion at
the global financial regulatory or supervisory forum
during the period covered by the report;
``(F) a description of the positions taken by
representatives of the Comptroller at the global
financial regulatory or supervisory forum during the
period covered by the report, including the rationale,
objectives, and potential impacts of such positions;
``(G) a summary of the meetings attended by
representatives of the Comptroller at the global
financial regulatory or supervisory forum during the
period covered by the report, including a discussion of
the key outcomes from such meetings;
``(H) the text of any final policies, standards, or
recommendations adopted by the global financial
supervisory or regulatory forum during the period
covered by the report, including any implementing
material, annex, appendix, side letter, or similar
document entered into contemporaneously or in
conjunction with the underlying policy, standard, or
recommendation, or an identification of a publicly
available source for the text of such policy, standard,
recommendation, or implementing material;
``(I) a description of any amendments to Federal
statutes, regulations of the Comptroller, guidance of
the Comptroller, or changes to the Comptroller's
supervisory practices the Comptroller anticipates will
be necessary to implement any final policies,
standards, or recommendations adopted by the global
financial supervisory or regulatory forum during the
period covered by the report;
``(J) a discussion of rules proposed, rules under
consideration, final rules adopted, guidance proposed,
guidance under consideration, final guidance adopted,
or any other similar actions taken by the Comptroller
during the period covered by the report to implement
agreements of the global financial regulatory or
supervisory forum, including an economic impact
analysis and a justification for why the expected costs
of implementing actions are at least offset by the
expected benefits related to economic, national
security, financial stability, or other national
interests; and
``(K) such other information relating to
interactions with the global financial regulatory or
supervisory forum during the period covered by the
report separately requested in writing by the Committee
on Banking, Housing, and Urban Affairs of the Senate or
the Committee on Financial Services of the House of
Representatives.
``(c) Global Financial Regulatory or Supervisory Forum Defined.--
``(1) In general.--In this section, the term `global
financial regulatory or supervisory forum' means any
association or union of nations through or by which two or more
foreign authorities engage in some aspect of their conduct of
international affairs regarding financial supervision and
regulation, including--
``(A) the Bank for International Settlements;
``(B) the Basel Committee on Banking Supervision;
``(C) the Financial Stability Board;
``(D) the International Association of Insurance
Supervisors; and
``(E) the Network of Central Banks and Supervisors
for Greening the Financial System.
``(2) Exception.--The term `global financial regulatory or
supervisory forum' does not include--
``(A) international financial institutions, as
defined in section 1701(c)(2) of the International
Financial Institutions Act (22 U.S.C. 262r(c)(2)); or
``(B) any international organization with respect
to which the Comptroller participates pursuant to a
treaty to which the United States is a party.''.
(B) Technical correction.--Chapter nine of title
VII of the Revised Statutes of the United States is
amended--
(i) by redesignating the first section 333
(12 U.S.C. 14a; relating to data standards) as
section 332;
(ii) by moving such section so as to appear
after section 331; and
(iii) in the table of contents of such
chapter, by amending the item relating to
section 332 to read as follows:
``332. Data standards; open data publication.''.
(3) Federal deposit insurance corporation.--Section 17(a)
of the Federal Deposit Insurance Act (12 U.S.C. 1827(a)) is
amended by striking paragraph (3) and inserting the following:
``(3) Interactions with global financial regulatory or
supervisory forums.--The report required under paragraph (1)
shall include a description of the Corporation's interactions
with global financial regulatory or supervisory forums,
including--
``(A) a list of the global financial regulatory or
supervisory forums in which the Corporation maintained
membership during the period covered by the report; and
``(B) for each such global financial regulatory or
supervisory forum in the list provided pursuant to
subparagraph (A)--
``(i) a description of the general purposes
of the global financial regulatory or
supervisory forum, including a list of the
current members and observers of the global
financial regulatory or supervisory forum;
``(ii) a discussion of how the general
purposes of the global financial regulatory or
supervisory forum align with the purposes of
this Act and the other Acts that the
Corporation implements;
``(iii) an identification of the sources
that provided a material amount of funding for
the operations of the global financial
regulatory or supervisory forum during the
period covered by the report;
``(iv) a description of the organization
the Corporation maintained during the period
covered by the report to conduct interactions
with the global financial regulatory or
supervisory forum, including an organizational
chart and an identification of the official
staff of the Corporation with oversight
responsibility for interactions with the global
financial regulatory or supervisory forum;
``(v) a discussion of the financial
regulatory or supervisory standard-setting
issues under discussion at the global financial
regulatory or supervisory forum during the
period covered by the report;
``(vi) a description of the positions taken
by representatives of the Corporation at the
global financial regulatory or supervisory
forum during the period covered by the report,
including the rationale, objectives, and
potential impacts of such positions;
``(vii) a summary of the meetings attended
by representatives of the Corporation at the
global financial regulatory or supervisory
forum during the period covered by the report,
including a discussion of the key outcomes from
such meetings;
``(viii) the text of any final policies,
standards, or recommendations adopted by the
global financial supervisory or regulatory
forum during the period covered by the report,
including any implementing material, annex,
appendix, side letter, or similar document
entered into contemporaneously or in
conjunction with the underlying policy,
standard, or recommendation, or an
identification of a publicly available source
for the text of such policy, standard,
recommendation, or implementing material;
``(ix) a description of any amendments to
Federal statutes, regulations of the
Corporation, guidance of the Corporation, or
changes to the Corporation's supervisory
practices the Corporation anticipates will be
necessary to implement any final policies,
standards, or recommendations adopted by the
global financial supervisory or regulatory
forum during the period covered by the report;
``(x) a discussion of rules proposed, rules
under consideration, final rules adopted,
guidance proposed, guidance under
consideration, final guidance adopted, or any
other similar actions taken by the Corporation
during the period covered by the report to
implement agreements of the global financial
regulatory or supervisory forum, including an
economic impact analysis and a justification
for why the expected costs of implementing
actions are at least offset by the expected
benefits related to economic, national
security, financial stability, or other
national interests; and
``(xi) such other information relating to
interactions with the global financial
regulatory or supervisory forum during the
period covered by the report separately
requested in writing by the Committee on
Banking, Housing, and Urban Affairs of the
Senate or the Committee on Financial Services
of the House of Representatives.
``(4) Global financial regulatory or supervisory forum
defined.--
``(A) In general.--In this subsection, the term
`global financial regulatory or supervisory forum'
means any association or union of nations through or by
which two or more foreign authorities engage in some
aspect of their conduct of international affairs
regarding financial supervision and regulation,
including--
``(i) the Bank for International
Settlements;
``(ii) the Basel Committee on Banking
Supervision;
``(iii) the Financial Stability Board;
``(iv) the International Association of
Insurance Supervisors; and
``(v) the Network of Central Banks and
Supervisors for Greening the Financial System.
``(B) Exception.--The term `global financial
regulatory or supervisory forum' does not include--
``(i) international financial institutions,
as defined in section 1701(c)(2) of the
International Financial Institutions Act (22
U.S.C. 262r(c)(2)); or
``(ii) any international organization with
respect to which the Corporation participates
pursuant to a treaty to which the United States
is a party.''.
(b) Biannual Congressional Testimony on Interactions With Global
Financial Regulatory or Supervisory Forums.--Paragraph (12) of section
10 of the Federal Reserve Act (12 U.S.C. 247b) is amended by inserting
before the period at the end the following: ``and with respect to the
conduct of interactions at global financial regulatory or supervisory
forums (as defined in paragraph (7)(C))''.
TITLE V--STRENGTHENING LOCAL BANK FUNDING
SEC. 501. BRINGING THE DISCOUNT WINDOW INTO THE 21ST CENTURY.
Section 10 of the Federal Reserve Act (12 U.S.C. 241 et seq.) is
amended by inserting after paragraph (10) the following:
``(11) Review of discount window operations.--
``(A) In general.--Not later than 60 days after the
date of enactment of this paragraph, the Board of
Governors shall commence a review of the discount
window lending programs of the Federal reserve banks
(the `discount window'), and shall complete such review
not later than 240 days after the date of enactment of
this paragraph.
``(B) Contents.--The review required by
subparagraph (A) shall include a consideration of--
``(i) the effectiveness of the discount
window in providing liquidity to financial
institutions, including in times of financial
stress;
``(ii) whether the technology
infrastructure, including means of
communications, are sufficient to support the
timely provision of liquidity, including in
times of financial stress;
``(iii) the effectiveness of cybersecurity
measures implemented with respect to discount
window operations;
``(iv) the effectiveness of communications
between Federal reserve banks, financial
institutions, the Board of Governors, the
Federal Deposit Insurance Corporation, the
Comptroller of the Currency, and the Secretary
of the Treasury regarding discount window
operations;
``(v) the effectiveness of the Board of
Governors in providing oversight of the
discount window and in ensuring consistent
access to the discount window across the
Federal Reserve System;
``(vi) how the discount window interacts
with other providers of liquidity, including
the Federal Home Loan Banks, during both normal
operations and times of financial distress;
``(vii) the effectiveness of existing
discount window operating hours and whether
such hours should be expanded, taking into
account the interaction between discount window
operating hours and the operating hours of
payment systems of the Federal reserve banks,
such as the Fedwire Funds Service and FedNow
Service;
``(viii) the impact of mobile banking and
instant communications technology on depositor
behavior and liquidity risk posed to financial
institutions, including how the discount window
can--
``(I) help financial institutions
better respond to rapid liquidity
shortfalls; and
``(II) prevent broader financial
instability; and
``(ix) the effectiveness of the discount
window in light of the stigma associated with
its usage, ways to reduce such stigma, and ways
to improve access, operational efficiency,
transparency, and timeliness of the process for
financial institutions seeking advances,
including on the pricing and other terms of
such advances.
``(C) Remediation plan.--After the Board of
Governors completes the review required by subparagraph
(A), the Board of Governors, in consultation with the
Federal reserve banks, shall--
``(i) identify deficiencies with the
discount window and areas for enhancing
discount window effectiveness; and
``(ii) develop a written plan to remediate
the identified deficiencies and implement the
identified enhancements, which shall include--
``(I) an identification of actions
that will be taken to enhance discount
window effectiveness and remediate
identified deficiencies;
``(II) timelines and milestones for
implementing the plan and measures to
demonstrate how the implemented
improvements will be maintained on an
ongoing basis; and
``(III) measures of managing and
controlling any deficiencies and
current operations until the plan is
implemented in full.
``(D) Report to congress on review and plan.--
``(i) In general.--Not later than 365 days
after the date of enactment of this paragraph,
the Board of Governors shall submit a report to
the Committee on Financial Services of the
House of Representatives and the Committee on
Banking, Housing, and Urban Affairs of the
Senate containing--
``(I) the findings of the review
required by subparagraph (A); and
``(II) the remediation plan
required by subparagraph (C).
``(ii) Consultation.--Before submitting the
report required by clause (i), the Board of
Governors shall--
``(I) provide a copy of the
proposed report to the Comptroller of
the Currency, the Federal Deposit
Insurance Corporation, and the
Secretary of the Treasury; and
``(II) provide the Comptroller of
the Currency, the Federal Deposit
Insurance Corporation, and the
Secretary of the Treasury with an
opportunity to provide feedback on the
report.
``(iii) Testimony.--The Chairman of the
Board of Governors shall, at the semi-annual
hearing required under section 2B, testify with
respect to the contents of the report required
under this subparagraph.
``(E) Annual reports to congress.--
``(i) Reports by the board.--The Board of
Governors shall submit an annual report to the
Committee on Financial Services of the House of
Representatives and the Committee on Banking,
Housing, and Urban Affairs of the Senate
containing a review of the effectiveness of
discount window operations and a progress
report on the actions taken to implement the
identified enhancements described in
subparagraph (C).
``(ii) Reports by the inspector general.--
The Inspector General of the Board of Governors
of the Federal Reserve System and the Bureau of
Consumer Financial Protection shall submit an
annual report to the Committee on Financial
Services of the House of Representatives and
the Committee on Banking, Housing, and Urban
Affairs of the Senate containing a report on
the progress of the Board of Governors in
implementing the remediation plan required by
subparagraph (C).
``(F) Confidential report information.--Any report
required under this paragraph may contain a
confidential annex containing information that, if made
public, could--
``(i) impact monetary policy, financial
stability, or cybersecurity; or
``(ii) significantly endanger the safety
and soundness of any financial institution.
``(G) Repeal.--This paragraph shall be repealed on
the date on which the Board of Governors notifies the
Congress and publishes on a public website of the Board
of Governors that the remediation plan required under
subparagraph (C) has been fully implemented.''.
SEC. 502. KEEPING DEPOSITS LOCAL.
(a) Amount of Reciprocal Deposits That Are Not Considered To Be
Funds Obtained by or Through a Deposit Broker.--Section 29(i) of the
Federal Deposit Insurance Act (12 U.S.C. 1831f(i)) is amended by
striking paragraph (1) and inserting the following:
``(1) In general.--The sum of the following amounts of
reciprocal deposits of an agent institution shall not be
considered to be funds obtained, directly or indirectly, by or
through a deposit broker:
``(A) An amount equal to 50 percent of the portion
of the total liabilities of the agent institution that
is less than or equal to $1,000,000,000.
``(B) An amount equal to 40 percent of the portion,
if any, of the total liabilities of the agent
institution that is greater than $1,000,000,000, but
less than or equal to $10,000,000,000.
``(C) An amount equal to 30 percent of the portion,
if any, of the total liabilities of the agent
institution that is greater than $10,000,000,000, but
less than or equal to $250,000,000,000.''.
(b) Definition of Agent Institution.--Section 29(i)(2)(A)(i) of the
Federal Deposit Insurance Act (12 U.S.C. 1831f(i)(2)(A)(i)) is amended
by striking subclause (I) and inserting the following:
``(I) when most recently examined
under section 10(d) was assigned a
CAMELS rating of 1, 2, or 3 under the
Uniform Financial Institutions Rating
System (or an equivalent rating under a
comparable rating system); and''.
(c) Reciprocal Deposits Study.--
(1) In general.--The Federal Deposit Insurance Corporation,
in consultation with the Board of Governors of the Federal
Reserve System, shall carry out a study on reciprocal deposits.
(2) Contents.--The study required under paragraph (1) shall
include--
(A) an analysis of how reciprocal deposits have
performed since 2018, which shall include--
(i) the use of quantitative and qualitative
data;
(ii) a breakdown of the usage of reciprocal
deposits by size of insured depository
institution;
(iii) the usage of reciprocal deposits
during periods of stress; and
(iv) an analysis, to the extent
practicable, of end-user depositors, such as
municipalities, businesses, and non-profit
organizations, that drive demand for reciprocal
products;
(B) an analysis, to the extent practicable, of how
reciprocal deposits compare to other deposit
arrangements; and
(C) an analysis of the benefits and potential risks
of reciprocal deposits.
(3) Report.--Not later than 6 months after the date of
enactment of this Act, the Federal Deposit Insurance
Corporation shall issue a report to the Committee on Financial
Services of the House of Representatives and the Committee on
Banking, Housing, and Urban Affairs of the Senate containing
all findings and determinations made in carrying out the report
required under paragraph (1).
SEC. 503. COMMUNITY BANK DEPOSIT ACCESS.
(a) In General.--Section 29 of the Federal Deposit Insurance Act
(12 U.S.C. 1831f) is amended by adding at the end the following:
``(j) Limited Exception for Custodial Deposits.--
``(1) In general.--Custodial deposits of an eligible
institution shall not be considered to be funds obtained,
directly or indirectly, by or through a deposit broker to the
extent that the total amount of such custodial deposits does
not exceed an amount equal to 20 percent of the total
liabilities of the eligible institution.
``(2) Definitions.--In this subsection:
``(A) Custodial deposit.--The term `custodial
deposit' means a deposit that is not deposited at an
insured depository institution in return for fees paid
by the insured depository institution pursuant to an
agreement with a third party and that would otherwise
be considered to be obtained, directly or indirectly,
by or through a deposit broker, if the deposit is
deposited at 1 or more insured depository institutions,
for the purpose of providing or maintaining deposit
insurance for the benefit of a third party, by or
through any of the following, each acting in a formal
custodial or fiduciary capacity for the benefit of a
third party:
``(i) An insured depository institution
serving as agent, trustee, or custodian.
``(ii) A trust entity controlled by an
insured depository institution serving as
agent, trustee, or custodian.
``(iii) A State-chartered trust company
serving as agent, trustee, or custodian.
``(iv) A plan administrator or investment
advisor, acting in a formal custodial or
fiduciary capacity for the benefit of a plan.
``(B) Eligible institution.--The term `eligible
institution' means an insured depository institution
that accepts custodial deposits, if the insured
depository institution has less than $10,000,000,000 in
total assets as reported on the consolidated report of
condition and income as reported quarterly to the
appropriate Federal banking agency and--
``(i)(I) when most recently examined under
section 10(d) was assigned a composite rating
of 1, 2, or 3 under the Uniform Financial
Institutions Rating System (or an equivalent
rating under a comparable rating system); and
``(II) is well capitalized; or
``(ii) has obtained a waiver pursuant to
subsection (c).
``(C) Plan.--The term `plan' has the meaning given
the term in section 3 of the Employee Retirement Income
Security Act of 1974 (29 U.S.C. 1002).
``(D) Plan administrator.--The term `plan
administrator' has the meaning given the term
`administrator' in section 3 of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1002).
``(E) Well capitalized.--The term `well
capitalized' has the meaning given the term in section
38(b).''.
(b) Interest Rate Restriction.--Section 29 of the Federal Deposit
Insurance Act (12 U.S.C. 1831f), as amended by subsection (a), is
further amended by adding at the end the following:
``(k) Restriction on Interest Rate Paid on Certain Custodial
Deposits.--
``(1) Definitions.--In this subsection--
``(A) the terms `custodial deposit', `eligible
institution', and `well capitalized' have the meanings
given those terms in subsection (j); and
``(B) the term `covered insured depository
institution' means an insured depository institution
that while acting as an eligible institution under
subsection (j), accepts custodial deposits while not
well capitalized.
``(2) Prohibition.--A covered insured depository
institution may not pay a rate of interest on custodial
deposits that are accepted while not well capitalized that, at
the time the funds or custodial deposits are accepted,
significantly exceeds the limit set forth in paragraph (3).
``(3) Limit on interest rates.--The limit on the rate of
interest referred to in paragraph (2) shall be not greater
than--
``(A) the rate paid on deposits of similar maturity
in the normal market area of the covered insured
depository institution for deposits accepted in the
normal market area of the covered insured depository
institution; or
``(B) the national rate paid on deposits of
comparable maturity, as established by the Corporation,
for deposits accepted outside the normal market area of
the covered insured depository institution.''.
TITLE VI--PROMOTING BANK COMPETITION AND MERGER CLARITY
SEC. 601. BANK COMPETITION MODERNIZATION.
(a) In General.--Section 18(c) of the Federal Deposit Insurance Act
(12 U.S.C. 1828(c)), as amended by section 103(c), is further amended--
(1) in paragraph (4)(C)--
(A) in clause (i), by striking ``or'' at the end;
(B) in clause (ii), by striking the period at the
end and inserting ``; or''; and
(C) by adding at the end the following:
``(iii) the proposed merger transaction
would result in an entity with less than
$10,000,000,000 in assets.''; and
(2) by adding at the end the following:
``(16) For Merger Transactions Resulting in Institutions With Less
Than $10,000,000,000 in Assets.--
``(A) In general.--Notwithstanding paragraph (5), if a
proposed merger transaction would result in an institution with
less than $10,000,000,000 in assets, then the responsible
agency shall not consider whether such merger transaction
would--
``(i) result in a monopoly, or would be in
furtherance of any combination or conspiracy to
monopolize or to attempt to monopolize the business of
banking in any part of the United States; and
``(ii) have the effect in any section of the
country of substantially lessening competition, tending
to create a monopoly, or in any other manner
restraining trade.
``(B) Threshold adjustment.--
``(i) In general.--At the end of each year for
which the nominal gross domestic product of the United
States increases (a `covered year'), the Corporation
shall adjust the dollar figures described in
subparagraph (A) and paragraph (4)(C)(iii) by a
percentage equal to the percentage increase (if any)
between--
``(I) the nominal gross domestic product of
the United States for the year, during the
preceding 5 years, with respect to which the
nominal gross domestic product of the United
States was the highest; and
``(II) the nominal gross domestic product
of the United States for the covered year.
``(ii) Determination of gdp.--In this paragraph,
the Corporation shall use nominal gross domestic
product statistics determined by the Bureau of Economic
Analysis.''.
(b) For Bank Holding Companies.--Section 3(c) of the Bank Holding
Company Act of 1956 (12 U.S.C. 1842(c)) is amended by adding at the end
the following:
``(8) For proposed transactions resulting in companies with
less than $10,000,000,000 in assets.--
``(A) In general.--Notwithstanding paragraph (1),
if a proposed acquisition, merger, or consolidation
under this section would result in a company with less
than $10,000,000,000 in assets, then the Board shall
not consider whether such acquisition, merger, or
consolidation would--
``(i) result in a monopoly, or would be in
furtherance of any combination or conspiracy to
monopolize or to attempt to monopolize the
business of banking in any part of the United
States; and
``(ii) have the effect in any section of
the country of substantially lessening
competition, tending to create a monopoly, or
in any other manner restraining trade.
``(B) Threshold adjustment.--
``(i) In general.--At the end of each year
for which the nominal gross domestic product of
the United States increases (a `covered year'),
the Board shall adjust the dollar figure
described in subparagraph (A) by a percentage
equal to the percentage increase (if any)
between--
``(I) the nominal gross domestic
product of the United States for the
year, during the preceding 5 years,
with respect to which the nominal gross
domestic product of the United States
was the highest; and
``(II) the nominal gross domestic
product of the United States for the
covered year.
``(ii) Determination of gdp.--In this
paragraph, the Board shall use nominal gross
domestic product statistics determined by the
Bureau of Economic Analysis.''.
(c) For Savings and Loan Holding Companies.--Section 10(e) of the
Home Owners' Loan Act (12 U.S.C. 1467a(e)), as amended by section
103(b), is further amended by adding at the end the following:
``(10) For proposed transactions resulting in companies
with less than $10,000,000,000 in assets.--
``(A) In general.--Notwithstanding subparagraphs
(A) and (B) of paragraph (2), if a proposed transaction
under this section would result in a company with less
than $10,000,000,000 in assets, then the Board shall
not consider whether the transaction would--
``(i) result in a monopoly, or would be in
furtherance of any combination or conspiracy to
monopolize or to attempt to monopolize the
savings and loan business in any part of the
United States; and
``(ii) have the effect in any section of
the country of substantially lessening
competition, tending to create a monopoly, or
in any other manner restraining trade.
``(B) Threshold adjustment.--
``(i) In general.--At the end of each year
for which the nominal gross domestic product of
the United States increases (a `covered year'),
the Board shall adjust the dollar figure
described in subparagraph (A) by a percentage
equal to the percentage increase (if any)
between--
``(I) the nominal gross domestic
product of the United States for the
year, during the preceding 5 years,
with respect to which the nominal gross
domestic product of the United States
was the highest; and
``(II) the nominal gross domestic
product of the United States for the
covered year.
``(ii) Determination of gdp.--In this
paragraph, the Board shall use nominal gross
domestic product statistics determined by the
Bureau of Economic Analysis.''.
SEC. 602. MERGER AGREEMENT APPROVALS CLARITY AND PREDICTABILITY.
(a) Study.--The Comptroller General of the United States shall
carry out a study on the use of commitments, conditions, and other
aspects of merger review procedures by Federal depository institution
regulatory agencies in connection with insured depository institution
merger applications. The study shall--
(1) include an evaluation of relevant quantifiable metrics;
(2) review the extent to which the use of commitments and
conditions has aligned with statutory requirements, including a
review of whether the use of commitments and conditions has
been influenced by extrastatutory issues or considerations;
(3) consider the benefits and risks of utilizing different
merger review approaches and procedures in compliance with the
law; and
(4) include an evaluation of the impact of such merger
review procedures and resulting approved mergers on safety and
soundness, financial stability, competition, and the
availability of financial products and services offered by
insured depository institutions.
(b) Report.--Not later than 1 year after the date of enactment of
this Act, the Comptroller General shall issue a report to Congress
containing all findings and determinations made in carrying out the
study required under subsection (a).
(c) Definitions.--In this section:
(1) Application.--The term ``application'' means an
application, notice, or other similar request for permission
submitted to a Federal depository institution regulatory
agency.
(2) Federal depository institution regulatory agency.--The
term ``Federal depository institution regulatory agency'' means
the Board of Governors of the Federal Reserve System, the
Comptroller of the Currency, the Federal Deposit Insurance
Corporation, and the National Credit Union Administration
Board.
(3) Insured depository institution.--The term ``insured
depository institution''--
(A) has the meaning given that term in section 3 of
the Federal Deposit Insurance Act (12 U.S.C. 1813); and
(B) means an insured credit union, as defined in
section 101 of the Federal Credit Union Act (12 U.S.C.
1752).
(4) Insured depository institution merger application.--The
term ``insured depository institution merger application''
means an application with respect to the acquisition of an
insured depository institution, its equity interests, its
assets, or its deposits under--
(A) section 10(e) of the Home Owners' Loan Act (12
U.S.C. 1467a(e));
(B) section 205(b) of the Federal Credit Union Act
(12 U.S.C. 1785(b));
(C) section 7(j) of the Federal Deposit Insurance
Act (12 U.S.C. 1817(j));
(D) section 18(c)(2) of the Federal Deposit
Insurance Act (12 U.S.C. 1828(c)(2));
(E) section 3 of the Bank Holding Company Act of
1956 (12 U.S.C. 1842); and
(F) section 4 of the Bank Holding Company Act of
1956 (12 U.S.C. 1843).
SEC. 603. MERGER PROCESS REVIEW.
(a) Review.--Not later than 1 year after the date of enactment of
this Act, and every 3 years thereafter, the Inspector General of each
Federal depository institution regulatory agency shall review the
Federal depository institution regulatory agency's merger review
procedures, including record of timeliness and efficiency in reviewing
and acting upon insured depository institution merger applications. The
review shall--
(1) include an evaluation of relevant quantifiable metrics,
including mean and median application processing times;
(2) identify sources of delay that may hinder the timely
consummation of proposals that meet the relevant statutory
factors;
(3) consider the benefits and risks of utilizing different
merger review approaches and procedures in compliance with the
law;
(4) include an evaluation of the impact of such merger
review procedures and resulting approved mergers on safety and
soundness, financial stability, competition, and the
availability of financial products and services offered by
insured depository institutions; and
(5) include specific recommendations to improve the merger
review process, including timeliness and efficiency of
application processing, consistent with the Federal depository
institution regulatory agency's statutory responsibilities.
(b) Report.--Each Inspector General described under subsection (a)
shall, at the conclusion of each review required under subsection (a),
issue a report to Congress containing all findings and determinations
made in carrying out the review, and publish such report online.
(c) Agency Response.--In response to each report issued to Congress
under subsection (a), the appropriate Federal depository institution
regulatory agency shall submit to Congress and publish online a written
response, including a plan to implement the recommendations in the
report, to the extent such implementation is appropriate.
(d) Definitions.--In this section:
(1) Application.--The term ``application'' means an
application, notice, or other similar request for permission
submitted to a Federal depository institution regulatory
agency.
(2) Federal depository institution regulatory agency.--The
term ``Federal depository institution regulatory agency'' means
the Board of Governors of the Federal Reserve System, the
Comptroller of the Currency, the Federal Deposit Insurance
Corporation, and the National Credit Union Administration
Board.
(3) Insured depository institution.--The term ``insured
depository institution''--
(A) has the meaning given that term in section 3 of
the Federal Deposit Insurance Act (12 U.S.C. 1813); and
(B) means an insured credit union, as defined in
section 101 of the Federal Credit Union Act (12 U.S.C.
1752).
(4) Insured depository institution merger application.--The
term ``insured depository institution merger application''
means an application with respect to the acquisition of an
insured depository institution, its equity interests, its
assets, or its deposits under--
(A) section 10(e) of the Home Owners' Loan Act (12
U.S.C. 1467a(e));
(B) section 205(b) of the Federal Credit Union Act
(12 U.S.C. 1785(b));
(C) section 7(j) of the Federal Deposit Insurance
Act (12 U.S.C. 1817(j));
(D) section 18(c)(2) of the Federal Deposit
Insurance Act (12 U.S.C. 1828(c)(2));
(E) section 3 of the Bank Holding Company Act of
1956 (12 U.S.C. 1842); and
(F) section 4 of the Bank Holding Company Act of
1956 (12 U.S.C. 1843).
TITLE VII--STRENGTHENING TRANSPARENCY AND INVOLVEMENT IN BANK
RESOLUTIONS
SEC. 701. LEAST COST EXCEPTION.
(a) In General.--Section 13(c)(4) of the Federal Deposit Insurance
Act (12 U.S.C. 1823(c)(4)) is amended--
(1) in subparagraph (A)(ii), by inserting ``except as
provided in subparagraph (I),'' before ``the total amount'';
(2) in subparagraph (E)(i), by inserting ``and except as
provided in subparagraph (I),'' after ``appropriate,''; and
(3) by adding at the end the following:
``(I) Least cost resolution exception.--
``(i) In general.--With respect to an exercise of
authority by the Corporation described in subparagraph
(A), the Corporation may, at the discretion of the
Corporation, select an alternative method of exercising
such authority that is not the least costly to the
Deposit Insurance Fund, if--
``(I) the Corporation determines that the
selected alternative complies with the
requirements of clause (iii); and
``(II) the Corporation and the Board of
Governors of the Federal Reserve System, after
consultation with the Secretary of the
Treasury, determine that the potential
additional risks to the Deposit Insurance Fund
of the selected alternative are outweighed by
the reasonably expected benefits of limiting
further concentration of the United States
banking system in global systemically important
banking organizations.
``(ii) Maximum cost to the deposit insurance
fund.--Not later than 1 year after the date of
enactment of this subparagraph, the Corporation, by
rule, shall establish criteria for determining on a
case-by-case basis the maximum allowable cost against
the net worth of the Deposit Insurance Fund that may be
utilized to account for any determination under clause
(i).
``(iii) Requirements described.--The requirements
for the selected alternative described in clause (i)
are as follows:
``(I) The selected alternative is least
costly to the Deposit Insurance Fund of all
alternatives that do not involve a transaction
with a global systemically important banking
organization and that do not exceed the cost of
liquidating the insured depository institution.
``(II) The difference between the cost of
the selected alternative and the cost of a
covered alternative is less than or equal to
the maximum cost to the Deposit Insurance Fund
specified pursuant to the rule adopted under
clause (ii).
``(III) In the case of a selected
alternative that involves another person
purchasing assets of the insured depository
institution or assuming deposit liabilities of
the insured depository institution, such person
agrees to pay an assessment to the Corporation
comprised of payments--
``(aa) made over a period to be
determined by the Corporation, but
which may not be less than 5 years; and
``(bb) in an amount that takes into
account, on a case-by-case basis,
criteria the Corporation, by rule,
shall establish, including a realistic
discount rate, the aggregate amount
equal to the difference calculated in
subclause (II), and any bid
inconsistent with the purposes of this
Act, with such rule to be established
by the Corporation not later than 1
year after the date of enactment of
this subparagraph.
``(iv) Report to congress.--Not later than 30 days
after selecting an alternative described in clause (i),
the Corporation shall issue a report to the Committee
on Financial Services of the House of Representatives
and the Committee on Banking, Housing, and Urban
Affairs of the Senate containing an analysis of the
economic difference between the cost to the Deposit
Insurance Fund of the selected alternative and the cost
to the Deposit Insurance Fund of the least costly
alternative that would have been selected absent the
application of this subparagraph.
``(v) Cost determinations.--All cost determinations
required under this subparagraph shall be made in
accordance with subparagraphs (B) and (C).
``(vi) Definitions.--In this subparagraph:
``(I) Covered alternative.--The term
`covered alternative' means a method of
exercising authority described in subparagraph
(A) that is the least costly to the Deposit
Insurance Fund of all such methods that involve
a sale of all or substantially all assets of
the insured depository institution to, and
assumption of all or substantially all deposit
liabilities of the insured depository
institution by, a global systemically important
banking organization.
``(II) Global systemically important
banking organization.--The term `global
systemically important banking organization'
means a global systemically important BHC (as
such term is defined in section 217.402 of
title 12, Code of Federal Regulations, or any
successor thereto) and any affiliate
thereof.''.
(b) Rule of Construction.--Section 13(c)(4)(H) of the Federal
Deposit Insurance Act (12 U.S.C. 1823(c)(4)(H)) does not apply to the
amendments made by subsection (a).
SEC. 702. ENHANCING BANK RESOLUTION PARTICIPATION.
(a) Study.--The Comptroller of the Currency, the Federal Deposit
Insurance Corporation, and the Board of the Governors of the Federal
Reserve System shall, jointly, carry out a study of--
(1) the use by the Comptroller of the Currency of shelf
charters, including all conditional or preliminary shelf
charter approvals granted between January 1, 2008, and the date
of enactment of this Act;
(2) the use by the Federal Deposit Insurance Corporation of
the modified bidder qualification process;
(3) the application of the Bank Holding Company Act of 1956
(12 U.S.C. 1841 et seq.) and section 10 of the Home Owners'
Loan Act (12 U.S.C. 1467a) to shelf charter proposals;
(4) whether shelf charters and modified bidder
qualification processes were considered or used in connection
with the receivership of any insured depository institution for
which the Federal Deposit Insurance Corporation was appointed
receiver in 2023;
(5) with respect to such receiverships, the extent to which
greater use of shelf charters and modified bidder qualification
processes could have--
(A) expanded the pool of participants in the
acquisition of the assets or liabilities of such failed
insured depository institutions;
(B) resulted in greater competition and diversity
in market outcomes;
(C) protected the Deposit Insurance Fund; or
(D) strengthened financial stability and reduced
the need for any emergency determination by the
Secretary of the Treasury under section 13(c)(4)(G) of
the Federal Deposit Insurance Act (12 U.S.C.
1823(c)(4)(G)) with respect to any such receivership;
(6) the impact of the use of shelf charters and modified
bidder qualification processes since January 1, 2008, including
on financial stability, the safety and soundness of affected
insured depository institutions, and the availability of
financial products and services provided to consumers by such
institutions; and
(7) any benefits and risks of private equity ownership of
banks through the use of shelf charters and modified bidder
qualification processes.
(b) Report.--Not later than 1 year after the date of enactment of
this Act, the Comptroller of the Currency, the Federal Deposit
Insurance Corporation, and the Board of the Governors of the Federal
Reserve System shall, jointly, submit a report to the Committee on
Financial Services of the House of Representatives and the Committee on
Banking, Housing, and Urban Affairs of the Senate containing--
(1) all findings and determinations made in carrying out
the study required under subsection (a); and
(2) an identification of statutory or regulatory barriers
to the use and effectiveness of shelf charters and modified
bidder qualification processes in the resolution of failed
insured depository institutions, including recommendations for
legislative and regulatory changes.
(c) Definitions.--In this section:
(1) Insured depository institution.--The term ``insured
depository institution'' has the meaning given the term in
section 3 of the Federal Deposit Insurance Act (12 U.S.C.
1813).
(2) Modified bidder qualification process.--The term
``modified bidder qualification process'' has the meaning given
such term in the press release of the Federal Deposit Insurance
Corporation titled ``FDIC Expands Bidder List for Troubled
Institutions Plan Allows Those Without a Bank Charter to
Participate in the Process'' published November 26, 2008.
(3) Shelf charter.--The term ``shelf charter'' has the
meaning given such term in the report issued by the Comptroller
of the Currency titled ``Activities Permissible for National
Banks and Federal Savings Associations, Cumulative'' published
October 2017.
TITLE VIII--FACILITATING INNOVATION AND BANK PARTNERSHIPS
SEC. 801. MERCHANT BANKING MODERNIZATION.
Section 4(k)(7)(A) of the Bank Holding Company Act of 1956 (12
U.S.C. 1843(k)(7)(A)) is amended by inserting ``Under such regulations,
the period of time generally permitted for holding merchant banking
investments shall not be less than 15 years. For any merchant banking
investment held on the date of enactment of the Merchant Banking
Modernization Act, the holding period of time permitted shall not be
less than 15 years from the initial date of the investment.'' after the
period at the end.
SEC. 802. BANK-FINTECH PARTNERSHIP ENHANCEMENT.
(a) Study on Bank-Fintech Partnerships.--
(1) Study.--The Board of Governors of the Federal Reserve
System, the Comptroller of the Currency, and the Federal
Deposit Insurance Corporation shall carry out a study of--
(A) the impact of partnerships between banking
organizations, on the one hand, and financial
technology companies, on the other hand, on the banking
sector, competition, innovation, consumer protection,
and the availability of financial products and
services, including the extent to which these
partnerships support the formation of new banking
organizations, reduce time to market for products and
services, lower compliance burdens, boost customer
acquisition, improve technological capabilities, and
provide access to more diverse funding sources; and
(B) what changes to Federal laws governing banking
organizations, or to rules or guidance adopted by the
Board of Governors of the Federal Reserve System, the
Comptroller of the Currency, or the Federal Deposit
Insurance Corporation, may help promote effective
partnerships between banking organizations, on the one
hand, and financial technology companies, on the other
hand.
(2) Report.--Not later than 1 year after the date of
enactment of this Act, the Board of Governors of the Federal
Reserve System, the Comptroller of the Currency, and the
Federal Deposit Insurance Corporation shall issue a report to
Congress containing all findings and determinations made in
carrying out the study required under paragraph (1).
(3) Banking organization defined.--In this subsection, the
term ``banking organization'' means a depository institution
holding company or an insured depository institution, as such
terms are defined, respectively, under section 3 of the Federal
Deposit Insurance Act (12 U.S.C. 1813).
(b) Study on Credit Union-Fintech Partnerships.--
(1) Study.--The National Credit Union Administration shall
carry out a study of--
(A) the impact of partnerships between credit
unions, on the one hand, and financial technology
companies, on the other hand, on the credit union
sector, competition, innovation, consumer protection,
and the availability of financial products and
services, including the extent to which these
partnerships support the formation of new credit
unions, reduce time to market for products and
services, lower compliance burdens, boost customer
acquisition, improve technological capabilities, and
provide access to more diverse funding sources; and
(B) what changes to Federal laws governing credit
unions, or to rules or guidance adopted by the National
Credit Union Administration, may help promote effective
partnerships between credit unions, on the one hand,
and financial technology companies, on the other hand.
(2) Report.--Not later than 1 year after the date of
enactment of this Act, the National Credit Union Administration
shall issue a report to Congress containing all findings and
determinations made in carrying out the study required under
subsection (a).
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Financial Services.
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