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Hensarling Announces Bold Plan for Regulatory Relief

Banks of all sizes would be able to “off-ramp” from certain Dodd-Frank Act and Basel III risk-based capital rules if they meet certain standards, under a plan released by the chairman of the House Financial Services Committee.

Representative Jeb Hensarling’s (R-Texas) Financial CHOICE Act would provide the “off-ramp” option for institutions with a simple leverage ratio of at least 10 percent and a composite CAMELS rating of 1 or 2. It also offers relief from numerous other regulatory burdens.

ICBA, which has worked closely with Hensarling on the plan, said it is a welcome opportunity for advancing community bank relief. CBAI fully concurs. “Chairman Hensarling’s common-sense reforms will free up resources that can be used to make loans, promote economic growth and create jobs in local communities nationwide,” ICBA President and CEO Cam Fine said.

While Hensarling’s proposal does not yet include legislative language, it would incorporate several bills inspired by ICBA’s Plan for Prosperity platform. CBAI is in full support of the Plan for Prosperity. These provisions would reform the Consumer Financial Protection Bureau, ease mortgage rules on portfolio loans, require tailored banking regulations, create a workable exam appeals process, and more. Read Hensarling Release. Read ICBA Release. See Plan for Prosperity.

June 8, 2016