The WBA-supported Financial CHOICE Act was voted to advance by the House Financial Services Committee last week. Introduced by Committee Chair Jeb Hensarling (R-TX), the bill includes reforms to rules on mortgage lending and small-business data collection, a revamp of the Consumer Financial Protection Bureau, and a repeal of Durbin amendment price controls on debit card interchange. The bill passed on a party-line vote.
The CHOICE Act is the latest effort to roll back burdensome regulations from the 2009 Dodd-Frank Act. It includes a variety of provisions such as a Qualified Mortgage safe harbor for mortgage loans held in portfolio, more tailored supervision based on an institution’s risk profile and business model and repeal of the Durbin Amendment, which capped prices on debit interchange, as well as the Volcker Rule.
The bill would also reform the Consumer Financial Protection Bureau, renaming it the Consumer Law Enforcement Agency and stripping it of examination powers and “UDAAP” enforcement authority and replace Dodd-Frank’s Orderly Liquidation Authority provision with a new Bankruptcy Code. In addition, it would also allow banks maintaining a 10 percent non-risk weighted leverage ratio to elect into an alternative regulatory regime that would, among other things, exempt qualifying institutions from federal capital and liquidity requirements, blocks on capital distributions, systemic risk regulations and limitations on mergers and acquisitions provided that any new entity also maintains the minimum leverage ratio.
WBA will keep you informed of the bill’s progress as well as ask you to write your legislators in the near future to support this critical legislation.