H.R. 6955
Main Street Capital Access Act
Sponsor: J. French Hill · 33 cosponsors
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Official summary
Written by the Congressional Research Service.
Main Street Capital Access Act or the Main Street Act
This bill lessens and otherwise modifies banking regulations, including those regarding institution formation, supervision by federal financial regulators, and bank merger requirements.
Under the bill, new banks have a three-year phase-in period to meet certain capital requirements. The bill also reduces the leverage ratio for certain rural community banks.
Financial regulators must (1) tailor regulatory actions to limit burdens on financial institutions and must consider the institutions' risk profiles and business models, and (2) review their regulations more frequently and expand the scope of these reviews.
The bill eases requirements regarding bank mergers, for example, by allowing financial regulators to approve certain bank mergers without considering if the merger is noncompetitive or monopolistic.
The bill increases the dollar asset thresholds for various fees, reporting requirements, and other regulatory requirements so that more financial companies and banks are exempt from these requirements. For example, the bill increases the total asset threshold above which financial holding companies need Federal Reserve Board approval to acquire a company, thereby allowing for more acquisitions without board approval. The bill also raises certain asset thresholds so as to allow additional small bank holding companies to operate with higher debt levels and additional small banks to qualify for a longer examination cycle.
The bill also provides flexibilities regarding the use of reciprocal deposits, the resolution of failed banks, and other regulated activities.
Text of the bill
I New Bank Formation and Local Community Access
II Tailoring Bank Regulation
III Fair and Transparent Bank Supervision
IV Regulatory Accountability and Transparency
V Strengthening Local Bank Funding
VI Promoting Bank Competition and Merger Clarity
VII Strengthening Transparency and Involvement in Bank Resolutions
(a) In general. Section 13(c)(4) of the Federal Deposit Insurance Act (12 U.S.C. 1823(c)(4)) is amended—
(1) in subparagraph (A)(ii), by inserting except as provided in subparagraph (I), before the total amount;
(2) in subparagraph (E)(i), by inserting and except as provided in subparagraph (I), after appropriate,; and
(3) by adding at the end the following:
(I) Least cost resolution exception
(i) In general. With respect to an exercise of authority by the Corporation described in subparagraph (A), the Corporation may, at the discretion of the Corporation, select an alternative method of exercising such authority that is not the least costly to the Deposit Insurance Fund, if—
(I) the Corporation determines that the selected alternative complies with the requirements of clause (iii); and
(II) the Corporation and the Board of Governors of the Federal Reserve System, after consultation with the Secretary of the Treasury, determine that the potential additional risks to the Deposit Insurance Fund of the selected alternative are outweighed by the reasonably expected benefits of limiting further concentration of the United States banking system in global systemically important banking organizations.
(ii) Maximum cost to the Deposit Insurance Fund. Not later than 1 year after the date of enactment of this subparagraph, the Corporation, by rule, shall establish criteria for determining on a case-by-case basis the maximum allowable cost against the net worth of the Deposit Insurance Fund that may be utilized to account for any determination under clause (i).
(iii) Requirements described. The requirements for the selected alternative described in clause (i) are as follows:
(I) The selected alternative is least costly to the Deposit Insurance Fund of all alternatives that do not involve a transaction with a global systemically important banking organization and that do not exceed the cost of liquidating the insured depository institution.
(II) The difference between the cost of the selected alternative and the cost of a covered alternative is less than or equal to the maximum cost to the Deposit Insurance Fund specified pursuant to the rule adopted under clause (ii).
(III) In the case of a selected alternative that involves another person purchasing assets of the insured depository institution or assuming deposit liabilities of the insured depository institution, such person agrees to pay an assessment to the Corporation comprised of payments—
(aa) made over a period to be determined by the Corporation, but which may not be less than 5 years; and
(bb) in an amount that takes into account, on a case-by-case basis, criteria the Corporation, by rule, shall establish, including a realistic discount rate, the aggregate amount equal to the difference calculated in subclause (II), and any bid inconsistent with the purposes of this Act, with such rule to be established by the Corporation not later than 1 year after the date of enactment of this subparagraph.
(iv) Report to Congress. Not later than 30 days after selecting an alternative described in clause (i), the Corporation shall issue a report to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate containing an analysis of the economic difference between the cost to the Deposit Insurance Fund of the selected alternative and the cost to the Deposit Insurance Fund of the least costly alternative that would have been selected absent the application of this subparagraph.
(v) Cost determinations. All cost determinations required under this subparagraph shall be made in accordance with subparagraphs (B) and (C).
(vi) Definitions. In this subparagraph:
(I) Covered alternative. The term covered alternative means a method of exercising authority described in subparagraph (A) that is the least costly to the Deposit Insurance Fund of all such methods that involve a sale of all or substantially all assets of the insured depository institution to, and assumption of all or substantially all deposit liabilities of the insured depository institution by, a global systemically important banking organization.
(II) Global systemically important banking organization. The term global systemically important banking organization means a global systemically important BHC (as such term is defined in section 217.402 of title 12, Code of Federal Regulations, or any successor thereto) and any affiliate thereof.
(b) Rule of construction. Section 13(c)(4)(H) of the Federal Deposit Insurance Act (12 U.S.C. 1823(c)(4)(H)) does not apply to the amendments made by subsection (a).
VIII Facilitating Innovation and Bank Partnerships