Title: Community Bank Regulatory Relief Act
Policy area: Finance and Financial Sector

Summary:
Community Bank Regulatory Relief Act
This bill delays required compliance with certain accounting standards applicable to credit losses (i.e., current expected credit losses standards, also known as CECL standards). Specifically, no agency may require a person to comply with this standard with respect to a fiscal year beginning before December 31, 2024.
Additionally, the community bank leverage ratio is set at 8% for community banks seeking to satisfy simplified capital adequacy requirements. Currently, banking agencies are required to set the rate between 8% and 10% through rulemaking.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 3502 Introduced in Senate (IS)]

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116th CONGRESS
  2d Session
                                S. 3502

To delay the implementation date of the current expected credit losses 
methodology for estimating allowances for credit losses, and for other 
                               purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 16, 2020

    Mr. Cramer (for himself, Mr. Cotton, Mr. Tillis, and Mr. Moran) 
introduced the following bill; which was read twice and referred to the 
            Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
To delay the implementation date of the current expected credit losses 
methodology for estimating allowances for credit losses, and for other 
                               purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Community Bank Regulatory Relief 
Act''.

SEC. 2. DELAYED IMPLEMENTATION DATE FOR CECL.

    (a) Definitions.--In this section--
            (1) the term ``CECL'' means the accounting standard in 
        ``Accounting Standards Update 2016-13, Financial Instruments--
        Credit Losses (Topic 326)'', issued by the Financial Accounting 
        Standards Board in June 2016, as amended by ``Accounting 
        Standards Update 2018-19, Codification Improvements to Topic 
        326, Financial Instruments--Credit Losses'', issued by the 
        Financial Accounting Standards Board in November 2018; and
            (2) the term ``Federal financial regulators'' means--
                    (A) the Department of the Treasury;
                    (B) the Board of Governors of the Federal Reserve 
                System;
                    (C) the Bureau of Consumer Financial Protection;
                    (D) the Office of the Comptroller of the Currency;
                    (E) the Commodity Futures Trading Commission;
                    (F) the Federal Deposit Insurance Corporation;
                    (G) the Federal Housing Finance Agency;
                    (H) the National Credit Union Administration; and
                    (I) the Securities and Exchange Commission.
    (b) Delay.--No Federal agency, including any of the Federal 
financial regulators, may require a person to use CECL for any purpose 
with respect to any fiscal year that begins before December 31, 2024.

SEC. 3. COMMUNITY BANK LEVERAGE RATIO.

    (a) In General.--Section 201 of the Economic Growth, Regulatory 
Relief, and Consumer Protection Act (12 U.S.C. 5371 note) is amended--
            (1) by striking subsection (b) and inserting the following:
    ``(b) Community Bank Leverage Ratio.--
            ``(1) In general.--The Community Bank Leverage ratio for 
        qualifying community banks shall be 8 percent.
            ``(2) Procedures.--The appropriate Federal banking agencies 
        shall, through notice and comment rule making under section 553 
        of title 5, United States Code, establish procedures for 
        treatment of a qualifying community bank that has a Community 
        Bank Leverage Ratio that falls below the percentage established 
        under paragraph (1) after exceeding the percentage established 
        under paragraph (1).'';
            (2) in subsection (c)(1), in the matter preceding 
        subparagraph (A), by striking ``developed under'' and inserting 
        ``established under''; and
            (3) in subsection (d)(2), by striking ``developed under'' 
        and inserting ``established under''.
    (b) Applicability.--Beginning on the effective date described in 
subsection (c), any provision of a rule that was issued under section 
201(b) of the Economic Growth, Regulatory Relief, and Consumer 
Protection Act (12 U.S.C. 5371 note) before the date of enactment of 
this Act and that is inconsistent with such section 201(b), as amended 
by subsection (a) of this section, shall have no force or effect.
    (c) Effective Date.--This section, and the amendments made by this 
section, shall take effect on the date that is 7 days after the date of 
enactment of this Act.
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