IB 
Union Calendar No. 206 
119TH CONGRESS 
1ST SESSION H. R. 4437 
[Report No. 119–249] 
To reduce the regulatory burden on certain well managed and well capitalized 
financial institutions, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 16, 2025 
Mr. TIMMONS (for himself and Mr. FOSTER) introduced the following bill; 
which was referred to the Committee on Financial Services 
SEPTEMBER 8, 2025 
Reported with an amendment, committed to the Committee of the Whole 
House on the State of the Union, and ordered to be printed 
[Strike out all after the enacting clause and insert the part printed in italic] 
[For text of introduced bill, see copy of bill as introduced on July 16, 2025] 
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A BILL 
To reduce the regulatory burden on certain well managed 
and well capitalized financial institutions, and for other 
purposes. 
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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 ‘‘Supervisory Modifica-
tions for Appropriate Risk-based Testing Act of 2025’’ or 
the ‘‘SMART Act of 2025’’. 
SEC. 2. EXAMINATION RELIEF FOR CERTAIN WELL MAN-
AGED AND WELL CAPITALIZED FINANCIAL IN-
STITUTIONS. 
(a) INSURED DEPOSITORY INSTITUTIONS.—Section 
10(d) of the Federal Deposit Insurance Act (12 U.S.C. 
1820(d)) is amended by adding at the end the following: 
‘‘(11) EXAMINATION RELIEF FOR CERTAIN WELL 
MANAGED AND WELL CAPITALIZED INSURED DEPOSI-
TORY INSTITUTIONS.— 
‘‘(A) IN
GENERAL.—The following shall 
apply to a well managed and well capitalized 
insured 
depository 
institution 
with 
$6,000,000,000 or less in consolidated assets: 
‘‘(i) ALTERNATING LIMITED-SCOPE EX-
AMINATIONS.—After an insured depository 
institution receives a full-scope, on-site ex-
amination from the appropriate Federal 
banking agency, the next examination of the 
insured depository institution by the appro-
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priate Federal banking agency shall be a 
limited-scope examination, as determined 
by the appropriate Federal banking agency. 
‘‘(ii) COMBINED EXAMINATIONS.—If an 
insured depository institution is otherwise 
subject to separate safety and soundness ex-
aminations, consumer compliance examina-
tions, and information technology and cy-
bersecurity examinations, the appropriate 
Federal banking agency shall, upon request 
of the insured depository institution, com-
bine two or three such examinations, as 
specified by the insured depository institu-
tion, and carry them out at the same time. 
‘‘(B) EXCEPTION.—Subparagraph (A) shall 
not apply to an insured depository institution 
if— 
‘‘(i) the insured depository institution 
is currently subject to a formal enforcement 
proceeding or order by the Corporation or 
the appropriate Federal banking agency; or 
‘‘(ii) a person acquired control of the 
insured depository institution since the 
most recent full-scope, on-site examination 
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of the insured depository institution from 
the appropriate Federal banking agency. 
‘‘(C) RULEMAKING.—Not later than 12 
months after the date of enactment of this para-
graph, the Federal banking agencies shall issue 
rules to carry out subparagraph (A), including, 
with respect to an insured depository institution 
described under subparagraph (A), to— 
‘‘(i) establish procedures for the lim-
ited-scope examinations described in sub-
paragraph (A)(i); 
‘‘(ii) establish procedures for reviewing 
insured depository institutions that— 
‘‘(I) experience material changes 
in financial condition or operational 
risk profile between scheduled examina-
tions; or 
‘‘(II) have failed to comply with 
Federal or State banking laws and reg-
ulations; and 
‘‘(iii) balance the goals of streamlining 
the examination cycle for individual in-
sured depository institutions and reducing 
unnecessary regulatory burdens while main-
taining sufficient oversight to ensure the 
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continued safety and soundness of the in-
sured depository institutions and compli-
ance with all applicable laws and regula-
tions. 
‘‘(D) RULE OF CONSTRUCTION.—Nothing in 
this paragraph may be construed to limit the au-
thority of a Federal banking agency to conduct 
off-site monitoring, targeted reviews, or addi-
tional full-scope, on-site examinations of an in-
sured depository institution if the Federal bank-
ing agency determines such monitoring, reviews, 
or examinations are necessary to ensure safety 
and soundness or compliance with applicable 
laws. 
‘‘(E) DEFINITIONS.—In this paragraph: 
‘‘(i) CONSUMER COMPLIANCE EXAMINA-
TION.—The term ‘consumer compliance ex-
amination’ means an examination to assess 
compliance with the requirements of Federal 
consumer financial law (as such term is de-
fined in section 1002 of the Consumer Fi-
nancial Protection Act of 2010). 
‘‘(ii) WELL
CAPITALIZED.—The term 
‘well capitalized’ has the meaning given 
that term in section 38(b). 
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‘‘(iii) WELL MANAGED.—With respect 
to an insured depository institution, the 
term ‘well managed’ means that, when the 
institution was most recently examined by 
the appropriate Federal banking agency, the 
institution was found to be well managed, 
and the institution’s composite condition 
was found to be satisfactory or out-
standing.’’. 
(b) INSURED CREDIT UNIONS.—Section 204 of the 
Federal Credit Union Act (12 U.S.C. 1784) is amended by 
adding at the end the following: 
‘‘(h) EXAMINATION RELIEF FOR CERTAIN WELL MAN-
AGED
AND
WELL
CAPITALIZED
INSURED
CREDIT 
UNIONS.— 
‘‘(1) IN GENERAL.—The following shall apply to 
a well managed and well capitalized insured credit 
union with $6,000,000,000 or less in consolidated as-
sets: 
‘‘(A) ALTERNATING LIMITED-SCOPE EXAMI-
NATIONS.—After an insured credit union receives 
a full-scope, on-site examination from the Na-
tional Credit Union Administration, the next ex-
amination of the insured credit union by the Na-
tional Credit Union Administration shall be a 
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limited-scope examination, as determined by the 
National Credit Union Administration. 
‘‘(B) COMBINED EXAMINATIONS.—If an in-
sured credit union is otherwise subject to sepa-
rate safety and soundness examinations, con-
sumer compliance examinations, and informa-
tion technology and cybersecurity examinations, 
the National Credit Union Administration shall, 
upon request of the insured credit union, com-
bine two or three such examinations, as specified 
by the insured credit union, and carry them out 
at the same time. 
‘‘(2) EXCEPTION.—Paragraph (1) shall not 
apply to an insured credit union if the insured credit 
union is currently subject to a formal enforcement 
proceeding or order by the National Credit Union Ad-
ministration. 
‘‘(3) RULEMAKING.—Not later than 12 months 
after the date of enactment of this subsection, the Na-
tional Credit Union Administration shall issue rules 
to carry out paragraph (1), including, with respect to 
an insured credit union described under paragraph 
(1), to— 
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‘‘(A) establish procedures for the limited- 
scope examinations described in paragraph 
(1)(A); 
‘‘(B) establish procedures for reviewing in-
sured credit unions that— 
‘‘(i) experience material changes in fi-
nancial condition or operational risk profile 
between scheduled examinations; or 
‘‘(ii) have failed to comply with Fed-
eral or State banking laws and regulations; 
and 
‘‘(C) balance the goals of streamlining the 
examination cycle for individual insured credit 
unions and reducing unnecessary regulatory bur-
dens while maintaining sufficient oversight to 
ensure the continued safety and soundness of the 
insured credit unions and compliance with all 
applicable laws and regulations. 
‘‘(4) RULE OF CONSTRUCTION.—Nothing in this 
subsection may be construed to limit the authority of 
the National Credit Union Administration to conduct 
off-site monitoring, targeted reviews, or additional 
full-scope, on-site examinations of an insured credit 
union if the National Credit Union Administration 
determines such monitoring, reviews, or examinations 
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are necessary to ensure safety and soundness or com-
pliance with applicable laws. 
‘‘(5) DEFINITIONS.—In this paragraph: 
‘‘(A) CONSUMER
COMPLIANCE
EXAMINA-
TION.—The term ‘consumer compliance examina-
tion’ means an examination to assess compliance 
with the requirements of Federal consumer fi-
nancial law (as such term is defined in section 
1002 of the Consumer Financial Protection Act 
of 2010). 
‘‘(B) WELL CAPITALIZED.—The term ‘well 
capitalized’ has the meaning given that term in 
section 216(c). 
‘‘(C) WELL MANAGED.—With respect to an 
insured credit union, the term ‘well managed’ 
means that, when the credit union was most re-
cently examined by the National Credit Union 
Administration, the credit union was found to be 
well managed, and the credit union’s composite 
condition was found to be satisfactory or out-
standing.’’. 
SEC. 3. EXAMINATION PRACTICES. 
(a) INSURED DEPOSITORY INSTITUTIONS.—Section 
10(d) of the Federal Deposit Insurance Act (12 U.S.C. 
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Union Calendar No. 206 
119TH CONGRESS 
1ST SESSION 
H. R. 4437 
[Report No. 119–249] 
A BILL 
To reduce the regulatory burden on certain well 
managed and well capitalized financial institu-
tions, and for other purposes. 
SEPTEMBER 8, 2025 
Reported with an amendment, committed to the Com-
mittee of the Whole House on the State of the Union, 
and ordered to be printed 
VerDate Sep 11 2014 
00:52 Sep 09, 2025
Jkt 059200
PO 00000
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