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Rep. Mooney Introduces The Small Bank Holding Company Relief Act

WASHINGTON, DC – Today, Rep. Alex X. Mooney introduced H.R. 4346, the Small Bank Holding Company Relief Act, to make it easier for smaller community banks to raise capital. This legislation provides sensible regulatory relief to rural financial institutions, while also preserving safety and soundness measures. On average, the United States loses more than one community bank every day because of burdensome federal regulation.

BACKGROUND: Small bank holding companies (SBHCs), or bank holding companies (BHCs) with total assets under $3 billion, are allowed to operate with higher debt levels, which can be used to more cheaply raise capital. Specifically, this bill would raise the required asset threshold to qualify as a SBHC from $3 billion to $10 billion. This legislation does not change capital rules and regulations for subsidiary banks.

5 House Republicans signed onto the bill as original cosponsors: Andy Barr (KY), Byron Donalds (FL), Monica De La Cruz (R-TX), Andy Ogles (R-TN), and Zach Nunn (IA).

This legislation is endorsed by the American Bankers Association (ABA) and the Independent Community Bankers of America (ICBA).

“Smaller financial institutions are the backbone of banking in West Virginia, and right now they are being suffocated by the federal government across the country,” said Rep. Alex X. Mooney. “My legislation provides commonsense relief to community banks which allow them to better service their local communities.”

“Since the passage of Dodd-Frank, regulatory burdens have impeded community banks’ ability to grow and lend. This legislation will alleviate unnecessary hurdles placed on small institutions and unleash their capabilities to provide financial services products and access for the communities they serve,” said Rep. Andy Barr.

“I am proud to cosponsor this legislation led by Rep. Mooney. Our local and regional banks are the heartbeat of our communities, and this bill gives them the ability to continue serving their customers without prohibitive and burdensome regulations,” said Rep. Monica De La Cruz.

“This key piece of legislation will empower small banks against the crushing weight of federal regulations by allowing them to raise capital by issuing debt. At a time when we have watched large banking enterprises fail, we must create room for growth and lending in small banks. I applaud Congressman Mooney for introducing this bill and I am proud to be an original cosponsor,” said Rep. Andy Ogles.

“This important legislation will strengthen America’s community banks by making it easier for smaller institutions to issue debt and bolster their capital. The bill will allow community banks to better meet the needs of their customers, clients and communities, while preserving their commitment to safety and soundness. We thank Rep. Mooney and the other co-sponsors for their leadership on this legislation and look forward to its timely consideration,” said ABA President and CEO Rob Nichols.

“ICBA strongly supports Rep. Mooney’s Small Bank Holding Company Relief Act, which will provide sensible regulatory relief to community banks to help them continue to serve their customers and communities,” Independent Community Bankers of America President and CEO Rebeca Romero Rainey said. “Raising the consolidated asset threshold to qualify as Small Bank Holding Companies from $3 billion to $10 billion will make it easier for small bank and thrift holding companies to raise additional capital, promoting lending and economic growth in local communities while preserving safety and soundness.”