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President Trump Signs Community-Bank Regulatory Relief Law

The Community Bankers Association of Illinois thanks President Trump for signing into law long-overdue, well-deserved and meaningful regulatory relief for the nation’s community banks. trump signs s2155

The Economic Growth, Regulatory Relief and Consumer Protection Act (S. 2155) is a carefully constructed bipartisan bill that includes common-sense improvements to financial regulation that will allow community banks to better serve their customers and communities. For consumers it will open the door for more creditworthy borrowers and businesses, and will contribute to local economic growth and job creation.

Community banks are the economic lifeblood of local communities. While holding less than 20 percent of the nation’s banking assets, community banks fund more than 60 percent of small-business loans and more than 80 percent of U.S. agricultural loans. Further, community banks operate in many areas where large banks do not, serving as the only physical banking presence in nearly one in five U.S. counties, according to the FDIC.

This legislation passed the U.S. Senate in March on a 67-31 bipartisan vote. Following Senate action, the U.S. House of Representatives passed the bill on a 258-159 bipartisan vote. Those members of the Illinois Congressional Delegation who voted in favor of this regulatory relief for community banks were Mike Bost (R-12th), Danny Davis (D-7th), Rodney Davis (R-13th), Bill Foster (D-11th), Randy Hultgren (R-14th), Adam Kinzinger (R-16th), Darin LaHood (R-18th), Peter Roskam (R-6th), Bradley Schneider (D-10th), and John Shimkus (R-15th).

CBAI’s President Kraig Lounsberry said, “We are delighted and thankful for the strong bipartisan support this legislation received in Congress and for President Trump signing the bill into law. This was a defining vote where members chose to either stand for or against community banks. We sincerely thank the Illinois Members of Congress who stood with us. Every Illinois Republican Congressman voted to pass this legislation. We particularly thank three Illinois Democrats - Congressmen Danny Davis, Bill Foster and Brad Schneider for voting to support community banks despite their party leadership’s unjustified opposition to the passage of this legislation.”

The next step is the regulators implementing these beneficial provisions of this legislation.

  • Granting “Qualified Mortgage” (QM) status for portfolio mortgage loans at most community banks;
  • Increasing exemption thresholds for Home Mortgage Disclosure Act (HMDA) reporting;
  • Exempting certain community-bank loans from escrow requirements;
  • Simplifying community-bank capital requirements;
  • Increasing eligibility for a short-form Call Report to restore proportionality to quarterly reporting;
  • Expanding eligibility for the 18-month regulatory-examination cycle to more community banks;
  • Easing appraisal requirements to facilitate mortgage credit in local communities;
  • Exempting most community banks from the Volcker Rule;
  • Expanding access to the Federal Reserve’s Small Bank Holding Company Policy Statement to help more community banks build capital; and
  • Improving regulatory treatment of reciprocal deposits and certain municipal securities.

CBAI worked closely and tirelessly with both Democrats and Republicans in Congress, and the Independent Community Bankers of America (ICBA), to help enact this important legislation into law.  

CBAI extends its thanks to all community bankers who engaged in the grassroots lobbying process to enlighten their lawmakers and encourage their support.

Click Here to learn more about what this legislation means for you bank.

May 25, 2018