Bill > S113

This bill aims to support the formation and growth of new banks, particularly in rural and underserved communities, by establishing several key provisions. The legislation creates a 3-year phase-in period for new financial institutions (de novo banks) to comply with federal capital requirements, allowing them more flexibility as they start up. Specifically, during this initial 3-year period, these new banks can request changes to their originally approved business plans, with federal banking agencies required to respond within 30 days. For rural community banks (defined as financial institutions with less than $10 billion in assets located in rural areas), the bill provides additional relief by setting a Community Bank Leverage Ratio of 8 percent, with a gradual phase-in during the first two years. The bill also expands agricultural loan authority for federal savings associations and mandates a study by federal banking agencies to understand the decline in new bank formation and identify ways to promote banks in underserved areas. This legislation responds to trends showing significant bank closures, particularly in rural communities, which have disproportionately impacted areas with higher poverty rates and lower median incomes, with the goal of improving financial access and supporting community banking.

Housing and Urban Affairs

https://www.congress.gov/bill/119th-congress/senate-bill/113/all-info