The California Bankers Association Applauds House Passage of Bipartisan Regulatory Reform Legislation

Press release

SACRAMENTO, Calif. – Today, the U.S. House of Representatives voted 258-159 to approve, S. 2155, the Economic Growth, Regulatory Relief and Consumer Protection Act. The bill, which passed the U.S. Senate in March on a strong bipartisan vote of 67-31 and now advances to the president for his signature, is designed to right-size banking regulations to allow banks to better serve their customers and their communities, while maintaining appropriate safety and soundness controls. 

“S. 2155 was years in the making and we thank Senate Banking Chairman Mike Crapo and House Financial Services Committee Chairman Jeb Hensarling for their unwavering leadership and commitment to passing commonsense regulatory reform,” said Simone Lagomarsino, president and CEO of the Western Bankers Association.

“This bill offers targeted fixes to a number of Dodd-Frank Act provisions that had unintended consequences for many of our community and regional banks,” Lagomarsino continued. “This legislation has been thoroughly vetted on both sides of the aisle, and will recalibrate financial regulations so banks can get back to lending to their customers, supporting their communities and helping our state and national economies grow.”

Specifically the bill:

  • Provides Qualified Mortgage designation for mortgages held in portfolio by banks with less than $10 billion in assets
  • Raises the threshold for designation as a systemically important financial institution from $50 billion in assets to $250 billion in assets
  • Ends stress tests entirely for banks with under $100 billion in assets
  • Exempts community banks under $10 billion in assets that have less than 5% of their total consolidated assets in trading activities from the Volcker Rule
  • Simplifies capital calculations for community banks
  • Provides relief from appraisal requirements for smaller mortgages
  • Institutes longer exam cycles for community banks

The primary pillars of Dodd-Frank, including higher capital standards, increased oversight of the most complex financial institutions, robust resolution planning and an independent Consumer Financial Protection Bureau and greater coordination between regulators, remain in place.

“The passage of this legislation is the culmination of years of hearings, input from hundreds of stakeholders including community groups and think tanks, and will provide significant relief to banks here in California and across the nation, while sending an important bipartisan message to bank regulators who are already taking steps to further streamline regulations,” concluded Lagomarsino.

About the Western Bankers Association

With more than 200 years of combined experience serving banks, the Western Bankers Association is one of the largest, state-banking, trade associations and regional educational organizations in the United States. WBA provides leading service and support to member banks throughout the Western States through two divisions.

CBA, the California state and federal advocacy division, is the advocate of the California banking industry for needed legislative, regulatory and legal changes.

WIB, the professional development division, provides education and training, and supports several hundred community banks headquartered in the 13 Western states by informing, educating, and connecting more than 20,000 bankers.