Federal banking regulators emphasized community bank exemptions from various regulations while testifying before the Senate Banking Committee.
Testimony: During an oversight hearing:
FDIC Chairman Martin Gruenberg and Federal Reserve Vice Chair for Supervision Michael Barr noted that community banks are exempt from proposed capital rules targeting banks over $100 billion in assets.
Gruenberg said interagency climate risk principles are intended for institutions over $100 billion in assets and that his agency recognizes that community banks may experience climate risks differently than larger institutions.
Acting Comptroller of the Currency Michael Hsu said the OCC will work to prevent requirements for large banks from trickling down to community banks and imposing undue burdens.
ICBA View: Amid a surge in rulemaking activity, ICBA has:
Commended regulators for targeting proposed capital and debt requirements to institutions over $100 billion in assets while calling on policymakers to continue to distinguish large banks from community banks.
Objected to the agencies’ climate principles, which include vague language describing all financial institutions and could ultimately affect community banks.
Expressed concerns with the Community Reinvestment Act final rule’s disproportionate implementation costs for community banks.
Noted the Fed’s recent interchange proposal would harm smaller card issuers, including those intended to be exempt from the proposal.
Next: The regulators will be back on Capitol Hill today for a House Financial Services Committee hearing.
