WASHINGTON–The Community Bank Sensible Regulation Act of 2015 has been introduced in the Senate by Sen. Susan Collins (R-ME) and would exempt community banks from certain rules and regulations of the FDIC, OCC and the Fed. The bill as currently written does not cite credit unions.
In a floor statement for S. 1799, Colins said the bill is designed to would allow financial regulators to exempt community banks from unnecessary and unduly burdensome requirements, “if doing so is in the public interest.” The bill would apply to all financial institutions with less than $10-billion and provide relief “from highly complex regulations designed to protect our financial system from systemic risks that would arise from the failure of larger banks,” Collins said in a statement. “All banks, large and small, should be well-capitalized and properly regulated, but that does not mean that our financial regulators must impose a one size fits all regulatory regime across the board without regard to the risks posed to the financial system by banks with fundamentally different business models and of vastly different sizes.”
Collins cited industry data that the cost of complying with regulations absorbs 12% of total bank operating expenses, and is two-and-a-half times greater for small banks than for large banks, and further pointed to the decline in the number of community banks as the result of competitive disadvantages due to regulatory costs.
‘Regulators should be able to tailor their regulations to take the distinctive nature of community banks into account,” said Collins. “My bill would allow regulators to exempt community banks from unnecessary and burdensome regulations where it is in the public interest to do so. I urge my colleagues to support it.”
John McKechnie, who previously led CUNA’s lobbying efforts and who is now a partner in the advocacy firm Total Spectrum in Washington, said, “Regulatory relief is important for community-based institutions, and credit unions should continually remind Congress that we need help too. Senator Collins has been a strong supporter of credit unions, as evidenced by her leadership on member business lending legislation in past years. If this legislation moves forward, the Senator and her colleagues should know that everything that she is saying about regulatory burdens for small institutions applies to credit unions, too.”