Closing the Enhanced Prudential Standards Loophole Act
Summary
What This Bill Does
The Closing the Enhanced Prudential Standards Loophole Act applies section 165 of the Financial Stability Act to a bank that has no bank holding company. The standalone bank must be supervised to the same extent as a bank holding company with the same amount of total consolidated assets.
The bill does not impose one uniform rule on every bank. It uses the existing asset-based section 165 framework, including whatever enhanced standards apply to a comparably sized holding company.
Who Benefits and How
Depositors and customers of large standalone banks benefit from prudential oversight comparable to similarly sized bank holding companies. Federal banking supervisors gain clear authority to apply section 165 without a holding-company structure. Competing bank holding companies benefit from more equivalent regulation across organizational forms.
Who Bears the Burden and How
Standalone banks within section 165's asset-based scope must comply with enhanced supervision and prudential standards. Their risk officers, compliance staff, boards, and information-system teams must implement the applicable requirements. Federal supervisors must examine the banks and map holding-company standards to standalone institutions. Bank shareholders may bear compliance costs.
Key Provisions
- Applies section 165 enhanced standards to banks without holding companies.
- Uses the bank's total consolidated assets to determine comparable treatment.
- Matches supervision to a bank holding company of the same size.
- Closes an organizational-form distinction in existing prudential law.
- Requires standalone-bank compliance where section 165 applies.
- Does not replace the existing asset-based standards with a new schedule.
Evidence Chain:
This summary is generated from the full bill text using AI analysis. Expand "Detailed Analysis" below for identified beneficiaries/burden bearers with clause-level evidence links.
At a Glance
What This Bill Does
Applies the Financial Stability Act's enhanced supervision and prudential standards to a bank without a bank holding company to the same extent as a bank holding company with the same consolidated assets.
Key Policy Areas
Banking Regulation, Enhanced Prudential Standards, Financial Stability, Standalone Banks
Primary Purpose
Applies the Financial Stability Act's enhanced supervision and prudential standards to a bank without a bank holding company to the same extent as a bank holding company with the same consolidated assets.
Policy Domains
Section 2 enhanced standards for standalone banks
Identified Gains
- Depositors at large standalone banks
- Customers of large standalone banks
- Federal banking supervisors
- Bank holding companies subject to section 165
Identified Costs
- Standalone banks subject to section 165
- Standalone-bank risk officers
- Standalone-bank compliance staff
- Federal bank examination staff
- Shareholders of regulated standalone banks
Sponsors
Legislative Progress
In CommitteeReferred to the House Committee on Financial Services.
Introduced in House
Ms. Waters introduced the following bill; which was referred to …
Stakeholder Effects
cui bono?How this legislation distributes effects. Mention counts reflect frequency, not effect magnitude.
Bank holding companies subject to section 165, Depositors at large standalone banks, Standalone banks subject to section 165
Positive-direction: Bank holding companies subject to section 165, Depositors at large standalone banks
Negative-direction: Standalone banks subject to section 165, Standalone-bank compliance staff, Standalone-bank risk officers
Federal bank examination staff, Federal banking supervisors
Positive-direction: Federal banking supervisors
Negative-direction: Federal bank examination staff
Bill Structure & Actor Mappings
Who is "The Secretary" in each section?
- "comparator"
- → Bank holding company with the same consolidated assets
- "supervisor"
- → Federal banking agency applying section 165
- "standalone_bank"
- → Bank without a bank holding company
Key Definitions
Terms defined in this bill
Application of section 165 to a bank without a holding company to the same extent as a holding company with equal consolidated assets.
We use a combination of our own taxonomy and classification in addition to large language models to assess meaning and potential beneficiaries. High confidence means strong textual evidence. Always verify with the original bill text.
Learn more about our methodology