HR3380-119

What This Bill Does

The TAILOR Act requires the Office of the Comptroller of the Currency, Federal Reserve Board, Federal Deposit Insurance Corporation, National Credit Union Administration, and Bureau of Consumer Financial Protection to tailor future regulatory actions to the risk profile and business model of affected institutions. For proposed, interim, or final rules after enactment, each agency must consider the type of institution subject to the action and limit regulatory impact, including cost, human resources, and other burdens, as appropriate for that institution's risk profile and business model. The bill also requires reduced reporting rules for every bank eligible for the Community Bank Leverage Ratio when filing the first and third reports of condition each year. Finally, Federal banking agencies, in consultation with State bank supervisors, must report to the Senate Banking Committee and House Financial Services Committee within 18 months on modernizing bank supervision, including changing business models, examiner workforce and training, supervisory technology, community-bank factors, and needed statutory changes.

Who Benefits and How

Community banks benefit because regulators must consider risk profile and business model before imposing new rule burdens. Banks eligible for the Community Bank Leverage Ratio benefit from reduced first- and third-quarter call-report requirements. Credit unions benefit because NCUA regulatory actions must be tailored to institution type and risk profile. Local-market bank customers benefit if smaller institutions can devote fewer resources to unnecessary compliance and more to serving local markets. Senate Banking Committee and House Financial Services Committee members benefit from a modernization report on supervision.

Who Bears the Burden and How

The Office of the Comptroller of the Currency, Federal Reserve Board, Federal Deposit Insurance Corporation, National Credit Union Administration, and Bureau of Consumer Financial Protection must document tailoring analysis for future rules. Federal banking agencies must promulgate reduced call-report regulations for Community Bank Leverage Ratio banks. State bank supervisors must consult on the supervision-modernization report. Bank examiners and supervisory technology offices must supply information on workforce, training, communication, collaboration, and technology. Large banking organizations may receive less direct relief if regulators conclude their risk profiles justify heavier requirements.

Key Provisions

• Establishes definitions for Federal financial institutions regulatory agency and regulatory action.
• Requires each covered regulator to tailor future rules to institution risk profile and business model.
• Requires agencies to consider aggregate regulatory effects, third-party service-provider actions, and statutory authority.
• Requires reduced first- and third-quarter call-report requirements for banks eligible for the Community Bank Leverage Ratio.
• Directs Federal banking agencies and State bank supervisors to report to Congress within 18 months on modernizing bank supervision.