I 

117TH CONGRESS 

1ST SESSION H. R. 2561 

To require the appropriate Federal banking agencies to establish a 3-year 

phase-in period for de novo financial institutions to comply with Federal 

capital standards, to provide relief for de novo rural community banks, 

and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 15, 2021 

Mr. BARR introduced the following bill; which was referred to the Committee 

on Financial Services 

A BILL 

To require the appropriate Federal banking agencies to establish a 3-year phase-in period for de novo financial 

institutions to comply with Federal capital standards, 

to provide relief for de novo rural community banks, 

and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Promoting Access to 

5 Capital in Underbanked Communities Act of 2021’’. 

6 SEC. 2. FINDINGS. 

7 The Congress finds the following: 


pbinns on DSKJLVW7X2PROD with BILLS
2 

•HR 2561 IH

1 (1) Trends in bank closures and consolidation 

2 have left many communities without access to bank3 ing services and disproportionately impact under4 served rural and urban communities. 

5 (2) De novo bank formation has slowed signifi6 cantly following the financial crisis. 

7 (3) A November 2019 report by the Federal 

8 Reserve System found that 44 counties in the U.S. 

9 were ‘‘deeply affected’’ by trends in bank closures 

10 and consolidation (i.e., had fewer than 10 branches 

11 in 2012 and lost at least 50 percent of them by 

12 2017). 

13 (4) 89 percent of the deeply affected counties 

14 were rural. 

15 (5) Rural counties deeply affected by branch 

16 closures had higher poverty rates, lower median in17 come, and a higher share of their population were 

18 African American compared to all rural commu19 nities. 

20 SEC. 3. PHASE-IN OF CAPITAL STANDARDS. 

21 The appropriate Federal banking agencies shall issue 

22 rules that provide for a 3-year phase-in period for a finan23 cial institution to meet any Federal capital requirements 

24 that would otherwise be applicable to the financial institu25 tion, where such 3-year period begins on the date on which 


pbinns on DSKJLVW7X2PROD with BILLS
3 

•HR 2561 IH

1 the deposit insurance that the financial institution has ob2 tained from the Federal Deposit Insurance Corporation 

3 becomes effective. 

4 SEC. 4. CHANGES TO BUSINESS PLANS. 

5 (a) IN GENERAL.—During the 3-year period begin6 ning on the date on which the deposit insurance that the 

7 financial institution has obtained from the Federal De8 posit Insurance Corporation becomes effective, a financial 

9 institution may request to deviate from a business plan 

10 that has been approved by the appropriate Federal bank11 ing agency by submitting a request to such agency pursu12 ant to this section. 

13 (b) REVIEW OF CHANGES.—An appropriate Federal 

14 banking agency shall, not later than the end of the 30- 

15 day period beginning on the receipt of a request under 

16 subsection (a)— 

17 (1) approve, conditionally approve, or deny such 

18 request; and 

19 (2) notify the financial institution of such deci20 sion and, if the agency denies the request— 

21 (A) provide the financial institution with 

22 the reason for such denial; and 

23 (B) suggest changes to the request that, if 

24 adopted, would allow the agency to approve 

25 such request. 


pbinns on DSKJLVW7X2PROD with BILLS
4 

•HR 2561 IH

1 (c) RESULT OF FAILURE TO ACT.—If an appropriate 

2 Federal banking agency fails to approve or deny a request 

3 within the 30-day period required under subsection (b), 

4 such request shall be deemed to be approved. 

5 SEC. 5. RURAL COMMUNITY BANK LEVERAGE RATIO. 

6 (a) IN GENERAL.—During the 3-year period begin7 ning on the date on which the deposit insurance that a 

8 rural community bank has obtained from the Federal De9 posit Insurance Corporation becomes effective, the Com10 munity Bank Leverage Ratio for the rural community 

11 bank shall be 8 percent. 

12 (b) PHASE-IN AUTHORITY.—The Federal banking 

13 agencies shall issue rules to phase-in the Community Bank 

14 Leverage Ratio described under subsection (a) with re15 spect to a rural community bank by setting lower Commu16 nity Bank Leverage Ratio percentages during the first 2 

17 years of the 3-year period described under subsection (a). 

18 (c) DEFINITIONS.—In this section: 

19 (1) COMMUNITY BANK LEVERAGE RATIO.—The 

20 term ‘‘Community Bank Leverage Ratio’’ has the 

21 meaning given that term under section 201(a) of the 

22 Economic Growth, Regulatory Relief, and Consumer 

23 Protection Act (12 U.S.C. 5371 note). 

24 (2) FEDERAL BANKING AGENCY.—The term 

25 ‘‘Federal banking agency’’ has the meaning given 


pbinns on DSKJLVW7X2PROD with BILLS
5 

•HR 2561 IH

1 that term under section 3 of the Federal Deposit In2 surance Act (12 U.S.C. 1813). 

3 (3) RURAL COMMUNITY BANK.—The term 

4 ‘‘rural community bank’’ means a financial institu5 tion— 

6 (A) with total consolidated assets of less 

7 than $10,000,000,000; and 

8 (B) located in a rural area, as defined 

9 under section 1026.35(b)(iv)(A) of title 12, 

10 Code of Federal Regulations. 

11 SEC. 6. AGRICULTURAL LOAN AUTHORITY FOR FEDERAL 

12 SAVINGS ASSOCIATIONS. 

13 Section 5(c) of the Home Owners’ Loan Act (12 

14 U.S.C. 1464(c)) is amended— 

15 (1) in paragraph (1), by adding at the end the 

16 following: 

17 ‘‘(V) AGRICULTURAL LOANS.—Secured or 

18 unsecured loans for agricultural purposes.’’; and 

19 (2) in paragraph (2)(A), by striking ‘‘business, 

20 or agricultural’’ and inserting ‘‘or business’’. 

21 SEC. 7. STUDY ON DE NOVO FINANCIAL INSTITUTION. 

22 (a) STUDY.—The appropriate Federal banking agen23 cies shall, jointly, carry out a study on— 


pbinns on DSKJLVW7X2PROD with BILLS
6 

•HR 2561 IH

1 (1) the principal causes for the low number of 

2 de novo financial institutions in the 10-year period 

3 ending on the date of enactment of this Act; and 

4 (2) ways to promote more de novo financial in5 stitutions in areas currently underserved by financial 

6 institutions. 

7 (b) REPORT TO CONGRESS.—Not later than the end 

8 of the 1-year period beginning on the date of enactment 

9 of this Act, the appropriate Federal banking agencies 

10 shall, jointly, issue a report to Congress containing all 

11 findings and determinations made in carrying out the 

12 study required under subsection (a). 

13 SEC. 8. DEFINITIONS. 

14 In this Act: 

15 (1) FINANCIAL INSTITUTION.—The term ‘‘fi16 nancial institution’’ means a depository institution 

17 or depository institution holding company. 

18 (2) OTHER BANKING TERMS.—The terms ‘‘ap19 propriate Federal banking agency’’, ‘‘depository in20 stitution’’, and ‘‘depository institution holding com21 pany’’ have the meaning given those terms, respec22 tively, under section 3 of the Federal Deposit Insur23 ance Act. 

Æ 


pbinns on DSKJLVW7X2PROD with BILLS