The U.S. House of Representatives on Tuesday passed the Main Street Capital Access Act, which adopts new banking regulations designed to help community banks.
According to a bill summary, the legislation, H.R. 6955, would:
- Establish a three-year phase-in period for capital requirements.
- Increase transparency in the chartering and supervisory process by requiring regulators to provide clearer guidance for new banks.
- Tailor federal banking regulations to a bank’s size and risk profile.
- Streamline reporting requirements for community and regional banks, reducing compliance costs.
- Improve the bank examination process by promoting more consistent supervisory standards, including reforms to CAMELS ratings.
- Strengthen competition by ensuring community banks and credit unions can better compete with the country’s largest financial institutions.
“Community banks are at the heart of Kentucky’s economy. They finance our small businesses, stand by our farmers, and help hardworking families buy homes, start businesses, and build a better future. House Republicans are delivering on our commitment to strengthen Main Street by cutting red tape, expanding access to capital, and creating an environment where community banks can thrive,” said U.S. Rep. Andy Barr (R-KY), chairman of the House Financial Services Subcommittee on Financial Institutions.
House Committee on Financial Services Chairman French Hill (R-AR) said that as a former community banker, he’s familiar with how community banks drive Main Street’s growth.
“For decades, Washington has forced these institutions to operate under rules built for the largest, most systemically important banks, stifling local lending and accelerating industry consolidation. This bill fixes that. It spurs the formation of new banks, restores common-sense tailoring to bank regulation, and removes barriers that have limited lending in communities across the country,” Hill said.
The Independent Community Bankers of America (ICBA) applauded the Houseʻs passage of the legislation and encouraged the Senate to take up and pass the measure.
“ICBA and the nation’s community bankers commend House passage of the Main Street Capital Access Act, which includes policies that will transform the regulatory environment to support community banking and economic growth in rural, suburban, and urban markets,” ICBA President and CEO Rebeca Romero Rainey said.