HR1900-119

What This Bill Does

The Bank Failure Prevention Act of 2025 changes bank regulatory application deadlines. It amends the Bank Holding Company Act, Home Owners' Loan Act, and Federal Deposit Insurance Act merger provisions so regulators must tell applicants within 30 days whether the record is complete or what information is missing. For complex applications, regulators may extend the completeness-letter period by another 30 days. When an applicant responds to a missing-information notice, the record is deemed complete unless the regulator finds the response materially deficient and sends a detailed deficiency notice within 30 days. Regulators may consider only information provided by the applicant when deciding whether the record is complete, not third-party reports, views, or recommendations. Most importantly, the Federal Reserve Board or responsible bank agency must grant or deny the application within 90 days after the initial submission regardless of whether the record was complete; if the agency misses the deadline, the application is deemed granted. The applicant may request an extension, but the agency may not extend more than 30 days past the deadline.

Who Benefits and How

Bank holding company applicants benefit from fixed deadlines, written completeness notices, and deemed approval if the Federal Reserve Board does not act within 90 days. Savings and loan holding company applicants benefit from parallel timing rules under the Home Owners' Loan Act. Banks seeking mergers benefit from responsible-agency deadlines under the Federal Deposit Insurance Act. Bank investors and transaction counterparties benefit from more predictable regulatory timing for acquisitions or mergers. Banking lawyers and compliance teams benefit from clearer completeness standards based on applicant-provided information.

Who Bears the Burden and How

The Federal Reserve Board must send completeness letters, deficiency notices, and final decisions under strict deadlines for holding company applications. Responsible bank merger agencies must follow the same timing and deemed-grant rules for merger applications. Community groups and other third parties lose influence over completeness determinations because regulators cannot base completeness on third-party views or recommendations. Bank examiners must evaluate applications faster and document deficiencies promptly. Prudential regulators face risk that an application is automatically granted if they miss the statutory deadline.

Key Provisions

• Requires completeness letters within 30 days for bank holding company applications.
• Applies similar completeness and decision deadlines to savings and loan holding company applications.
• Applies similar completeness and decision deadlines to bank merger applications under the Federal Deposit Insurance Act.
• Deems applicant responses complete unless regulators identify material deficiencies within 30 days.
• Prohibits regulators from using third-party information to determine whether an application record is complete.
• Requires grant or denial within 90 days after initial submission regardless of completeness.
• Deems applications granted when regulators miss the deadline.
• Limits applicant-requested deadline extensions to 30 additional days.