Small Bank Exam Cycle Reform Act of 2015
Floor Speech
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Mrs. CAROLYN B. MALONEY of New York. Mr. Speaker, I yield myself such time as I may consume.
I rise in support of H.R. 1553, the Small Bank Exam Cycle Reform Act. This bill allows more small banks to qualify for a longer, 18-month exam cycle. This means that these banks would only have a full, onsite examination every 18 months, rather than every 12 months.
The logic behind this bill is simple: small community banks that are both well capitalized and well managed do not need as much regulatory scrutiny as larger, more complex banks. In addition, regulators need the ability to focus their limited resources on the banks that present bigger risks. That is why we have long allowed well-run small banks to have less frequent examinations than larger, more complex banks.
This bill simply increases the threshold for banks that qualify for the 18-month cycle from $500 million to $1 billion. Onsite examinations are time-consuming endeavors both for the regulator and the bank, and if the regulator is conducting exams of these well-run banks more frequently than he really needs to, then he is wasting precious government resources. In addition, he is also wasting the bank's resources, because the frequent exams require the time and attention of the bank's executives and staff, and it is costly. Therefore, banks with assets between $500 million and $1 billion that are well capitalized and well managed will receive real, meaningful regulatory relief as a result of this bill.
Not only is this bill supported by small banks, it is also supported by the regulators. The OCC has in fact advocated for this change for some time now.
I am very glad that we are moving this bill through the House today, and I hope that the Senate will act quickly on the bill as well so that we can get regulatory relief to some very deserving community banks. I urge my colleagues to support this bill.
I congratulate my colleague, Lacy Clay, for also being the lead Democrat and working very hard on this bill.
I reserve the balance of my time.
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