The U.S. Senate advanced this week the Economic Growth, Regulatory Relief and Consumer Protection Act (S. 2155), which eases regulations for banks and financial institutions and rolls back provisions from Dodd-Frank.
The bill, which passed 67-31, includes several key provisions. One of them would increase the asset threshold for a regional bank to be considered systemically important to $100 billion and increases the threshold to $250 billion after 18 months. Large banks will continue to face the same higher capital requirements, stress tests, and other resilience measures as designated by the Dodd-Frank Act. Under Dodd-Frank, smaller banks were subject to the same compliance rules as the largest banks.
The legislation also increases the Federal Reserve’s Small Bank Holding Company (BHC) asset threshold from $1 billion to $3 billion. This increase would exempt the affected bank holding companies from certain capital requirements. The bill also provides support for financial companies to educate their employees about how to identify and prevent financial exploitation of senior citizens.
“I applaud the Senate passage of this bipartisan legislation. This bill provides targeted regulatory relief for small and mid-sized financial institutions, like the community banks, credit unions, and regional banks found across Utah,” Sen. Orrin Hatch (R-UT), chairman of the Senate Finance Committee, said. “These commonsense reforms reduce unnecessary compliance burdens on smaller financial institutions so they can better serve their customers and add consumer protections against identity theft and fraud.
Hatch continued, “I am pleased to see a number of my legislative priorities that will benefit Utah included in the bill. I urge my colleagues in the House to quickly pass the Senate-passed bill in order to provide much-needed regulatory relief to smaller financial institutions and to promote economic growth.”
Sen. Sherrod Brown (D-OH), ranking member of the U.S. Senate Committee on Banking, Housing, and Urban Affairs, said this bill puts taxpayers at risk of another bank bailout.
“This body once again sided with special interests and Wall Street instead of homeowners, students and working families,” Brown said. “We missed an opportunity to pass meaningful bipartisan legislation that would help community banks and provide real protections for consumers. Instead, we rolled back accountability measures for some of the biggest domestic and foreign banks at the expense of taxpayers. As this bill goes to the House, I will continue fighting against further rollbacks that put American taxpayers at risk of bailing out big banks.”