I 
114TH CONGRESS 
2D SESSION 
H. R. 4647 
To establish regulatory relief for certain financial institutions, and for other 
purposes. 
IN THE HOUSE OF REPRESENTATIVES 
FEBRUARY 26, 2016 
Mr. PERLMUTTER (for himself, Mr. LYNCH, Mr. VARGAS, Mr. HECK of Wash-
ington, Mr. HINOJOSA, and Mr. WELCH) introduced the following bill; 
which was referred to the Committee on Financial Services 
A BILL 
To establish regulatory relief for certain financial 
institutions, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Traditional Banking 
Regulatory Relief Act of 2015’’. 
SEC. 2. REGULATORY RELIEF FOR TRADITIONAL BANKING 
ORGANIZATIONS. 
(a) REGULATORY CAPITAL REQUIREMENTS.— 
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(1) IN GENERAL.—Section 18 of the Federal 
Deposit Insurance Act (12 U.S.C. 1828) is amended 
by adding at the end the following new subsection: 
‘‘(aa) TREATMENT OF TRADITIONAL BANKING OR-
GANIZATIONS.— 
‘‘(1) REGULATORY CAPITAL REQUIREMENTS.— 
‘‘(A) SIMPLE LEVERAGE RATIO.—The ap-
propriate Federal banking agencies shall issue 
regulations establishing a minimum simple le-
verage ratio at no less than 10 percent. The 
simple leverage ratio requirement shall be con-
sistent with regulations promulgated pursuant 
to section 38 (relating to prompt corrective ac-
tion). 
‘‘(B) 
APPLICATION
TO
TRADITIONAL 
BANKING
ORGANIZATION.—Notwithstanding 
any other provision of law, a traditional bank-
ing organization that meets the minimum sim-
ple leverage ratio established under subpara-
graph (A) may elect, by notice to the appro-
priate Federal banking agencies, to maintain 
the minimum simple leverage ratio as its sole 
measure of capital adequacy. 
‘‘(C) EXEMPTION FROM RISK-BASED CAP-
ITAL
REQUIREMENT.—The risk-based capital 
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requirement in section 38(c)(1)(A) shall not 
apply to a traditional banking organization that 
makes an election under subparagraph (B) and 
complies with regulations issued in accordance 
with this paragraph. 
‘‘(D) GRACE PERIOD.—A traditional bank-
ing organization that makes an election under 
subparagraph (B) and fails to maintain the 
minimum simple leverage ratio described in 
subparagraph (A) (as determined by the first 
quarterly report of condition issued after mak-
ing such an election) shall be exempt from the 
risk-based 
capital 
requirement 
in 
section 
38(c)(1)(A) for a period of 18 months begin-
ning on the date of such determination. 
‘‘(2) RESERVATION OF AUTHORITY.—Notwith-
standing any other provision of this subsection, an 
appropriate Federal banking agency may require ad-
ditional capital adequacy measures applicable to a 
newly chartered traditional banking organization or 
for an individual traditional banking organization if 
such measures are required to ensure the safety and 
soundness of the banking organization or to prevent 
an unacceptable risk to the Deposit Insurance Fund. 
‘‘(3) DEFINITIONS.— 
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‘‘(A) TRADITIONAL
BANKING
ORGANIZA-
TION.—The term ‘traditional banking organiza-
tion’ means any bank holding company, savings 
and loan holding company, bank, or savings as-
sociation that individually, and when including 
its parent, subsidiaries, and all affiliates, meets 
the following requirements: 
‘‘(i) Has zero trading assets and zero 
trading liabilities. 
‘‘(ii) Does not engage in swaps or se-
curity-based swaps (as such terms are de-
fined in section 1a of the Commodity Ex-
change Act (7 U.S.C. 1a)), other than 
swaps or security-based swaps referencing 
interest rates or foreign exchange swaps 
(as such terms are defined in such sec-
tion). 
‘‘(iii) Has a total gross notional expo-
sure of swaps and security-based swaps of 
not more than $3,000,000,000. 
‘‘(B) SIMPLE LEVERAGE RATIO.— 
‘‘(i) IN GENERAL.—The term ‘simple 
leverage ratio’ means— 
‘‘(I) total equity less goodwill and 
deferred tax assets, divided by 
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‘‘(II) total assets less goodwill 
and deferred tax assets, 
as measured by generally accepted ac-
counting principles. 
‘‘(ii) MEASUREMENTS.—For purposes 
of measuring the simple leverage ratio cap-
ital requirements of a traditional banking 
organization, 
the 
appropriate 
Federal 
banking agencies may, by regulation, re-
quire— 
‘‘(I) the exclusion, from total eq-
uity, of other intangible assets; or 
‘‘(II) the addition, to total assets, 
of off-balance sheet items. 
‘‘(iii) RULE OF CONSTRUCTION.—The 
simple leverage ratio shall not be construed 
to be a generally applicable leverage capital 
requirement for purposes of section 171 of 
the Dodd-Frank Wall Street Reform and 
Consumer Protection Act (12 U.S.C. 
5371).’’. 
(2) PHASE-IN FOR CERTAIN ORGANIZATIONS.— 
(A) IN
GENERAL.—Notwithstanding the 
minimum simple leverage ratio requirement 
under section 18(aa)(1)(B) of the Federal De-
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posit Insurance Act, a traditional banking orga-
nization with a simple leverage ratio of 8 per-
cent or more may make an election under such 
section 18(aa)(1)(B) during the 18-month pe-
riod beginning on the date of the enactment of 
this Act. 
(B) REQUIREMENT
TO
MEET
THE
MIN-
IMUM SIMPLE LEVERAGE RATIO.—A traditional 
banking organization making an election pursu-
ant to subparagraph (A) shall have until the 
end of the 18-month period described under 
subparagraph (A) to meet the minimum simple 
leverage ratio, or the organization’s election 
under section 18(aa)(1)(B) of the Federal De-
posit Insurance Act shall be terminated. 
(C) DEFINITIONS.—For purposes of this 
paragraph: 
(i) 
MINIMUM
SIMPLE
LEVERAGE 
RATIO.—The term ‘‘minimum simple lever-
age ratio’’ means the minimum simple le-
verage ratio established under section 
18(aa)(1)(A) of the Federal Deposit Insur-
ance Act. 
(ii) OTHER TERMS.—The terms ‘‘sim-
ple leverage ratio’’ and ‘‘traditional bank-
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ing organization’’ have the meaning given 
those terms, respectively, under section 
18(aa)(3) of the Federal Deposit Insur-
ance Act. 
(b) SHORT FORM CALL REPORT.—Section 7(a) of 
the Federal Deposit Insurance Act (12 U.S.C. 1817(a)) 
is amended by adding at the end the following: 
‘‘(12) SHORT FORM REPORTING.—The appro-
priate Federal banking agencies shall issue regula-
tions allowing for a reduced reporting requirement 
for a traditional banking organization that elects to 
maintain a simple leverage ratio as its sole measure 
of capital adequacy pursuant to section 18(aa).’’. 
(c) ON-SITE EXAMINATIONS.—Section 10(d) of the 
Federal Deposit Insurance Act (12 U.S.C. 1820(d)) is 
amended— 
(1) in paragraph (4)— 
(A) in the paragraph heading, by inserting 
‘‘AND TRADITIONAL BANKING ORGANIZATIONS’’ 
after ‘‘CERTAIN SMALL INSTITUTIONS’’; 
(B) in subparagraph (A), by inserting ‘‘or 
is a traditional banking organization defined in 
section 18(aa)(3)’’ after ‘‘$1,000,000,000’’; 
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(C) by striking subparagraph (B) and re-
designating subparagraphs (C) through (E) as 
subparagraphs (B) through (D), respectively; 
(D) in subparagraph (B) (as so redesig-
nated), by striking ‘‘condition’’ and all that fol-
lows through ‘‘$200,000,000’’ and inserting 
‘‘condition was found to be outstanding or 
good’’; 
(E) in subparagraph (C) (as so redesig-
nated), by striking ‘‘and’’ at the end; 
(F) in subparagraph (D) (as so redesig-
nated), by striking the period at the end and in-
serting ‘‘; and’’; and 
(G) by adding at the end the following new 
subparagraph: 
‘‘(E) the appropriate Federal banking 
agency believes the 18-month period is con-
sistent with the safety and soundness of the 
banking organization.’’; and 
(2) by striking paragraph (10). 
(d) STRESS TESTING.—Section 165(i)(2)(A) of the 
Dodd-Frank Wall Street Reform and Consumer Protec-
tion Act (12 U.S.C. 5365(i)(2)(A)) is amended by insert-
ing ‘‘, unless such companies are traditional banking orga-
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nizations (as defined in section 18(aa)(3) of the Federal 
Deposit Insurance Act)’’ after ‘‘annual stress tests’’. 
(e) TECHNICAL AMENDMENT.—Section 18 of the 
Federal Deposit Insurance Act (12 U.S.C. 1828) is 
amended by moving subsection (y) so as to appear above 
subsection (z). 
Æ 
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