The House Financial Services Committee last week held a hearing that included discussions on reducing unnecessary regulatory burdens to promote economic growth, with a large focus on the importance of supporting community banks to foster growth.
Hill Statement: Chairman French Hill (R-Ark.) said the committee's mission is to ensure the financial system remains a source of opportunity and prosperity for the American people, which means helping families buy their first home, supporting small businesses, and empowering community banks.
Community Bank Input: Florida Bankers Association President and CEO Kathleen Kraninger testified as a witness at the hearing, highlighting the importance of community bank relief.
Kraninger Testimony: In her testimony, Kraninger:
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Said regulation should be tailored so community banks are not treated like complex global institutions.
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Highlighted the 21st Century ROAD to Housing Act’s pro-community bank provisions on de novo banks, reciprocal and custodial deposits, and examination relief.
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Endorsed the Main Street Capital Access Act to reduce compliance burdens and support community bank lending.
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Cited the potential for the revised Community Bank Leverage Ratio framework to free significant capital for Main Street lending and advocated for regularly indexing regulatory thresholds.
Legislation: The 21st Century ROAD to Housing Act enacted in July includes many ICBA-backed reforms, while the House in July passed the ICBA-advocated Main Street Capital Access Act on a bipartisan vote. ICBA continues to press the Senate to advance the House-passed measure.
CBLR: The agencies in April issued a final rule to lower the CBLR from 9% to 8%, as long advocated by ICBA. The final rule also extends the grace period from two quarters to four quarters, subject to a limit of eight out of the prior five-year period.