Sens. Jerry Moran (R-Kan.), Jon Tester (D-Mont.) and Mark Kirk (R-Ill.) introduced legislation late last month that would provide regulatory relief to community banks.
The Community Lending Enhancement and Regulatory—or CLEAR—Relief Act would provide qualified mortgage status under the CFPB’s ability-to-repay rules for any mortgage originated and held in portfolio for at least three years by a lender with less than $10 billion in assets.
The legislation, which has gained Sens. Kay Hagan (D-N.C.) and Mary Landrieu (D-La.) as co-sponsors, would also exempt first lien mortgages held by a lender with less than $10 billion in assets from escrow requirements, and require the Federal Reserve to raise the Small Bank Holding Company Policy Statement’s qualifying asset threshold from $500 million to $5 billion.
Additionally, the legislation would exempt community banks with less than $1 billion in assets from Sarbanes-Oxley 404(b) internal-controls assessment mandate.
“This bipartisan legislation is key to unlocking the doors of local economic prosperity,” Independent Community Bankers of America President and CEO Camden R. Fine said. “As a former community banker, and one who represents the nation’s community banks, I realize just how important regulatory relief is for community banks and the future of their communities. I urge the Senate to support this vastly important bipartisan legislation because it’s a win-win for community banks and communities of all sizes throughout the nation.”