A group of 20 senators including Senate Banking Committee Chairman Mike Crapo (R-Idaho) called on regulators to revisit their proposed rule to implement exemptions from risk-based capital requirements for many community banks.
In a joint letter, the lawmakers said the agencies’ proposed rule does not meet Congress’ objective of simplifying the capital regime for banks with less than $10 billion in assets, as put forth in the ICBA-advocated S. 2155 regulatory relief law.
The Senate letter says the proposal to introduce a new Prompt Corrective Action framework would deter community banks from using the Community Bank Leverage Ratio framework to qualify for capital relief. It also advocates setting the CBLR at 8 percent, down from the proposed 9 percent threshold.
ICBA has repeatedly called on the agencies to lower the CBLR to 8 percent and remove the Prompt Corrective Action framework under the CBLR, including in its April comment letter on the proposal.