Senate Banking Committee Chairman Crapo (R-ID) has gathered enough support from moderate Democrats on his panel to advance regulatory-reform legislation that, while not sweeping, nonetheless addresses an array of community- and regional-bank concerns. Most significant among these for larger BHCs is language that would alter the Dodd-Frank thresholds in Section 165 for “enhanced regulation.” These currently hit at the $50 billion threshold, but the legislation now reserves the most stringent standards only for BHCs above the $250 billion level, giving the Board additional flexibility to redesign the “SIFI” standards as desired. The bill would also alter the leverage ratio (LR) denominator for custody banks along lines in comparable House legislation and give BHCs with less than $10 billion in assets the option to use only an LR standard raised to somewhere between eight and ten percent.
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