Dear Community Banker,
The first quarter of 2025 has witnessed an explosion of pro-community bank policy reform, culminating in yesterday’s House committee passage of several ICBA-advocated bills—including priority legislation to repeal the Consumer Financial Protection Bureau’s 1071 rule. Conversely, there is still significant work to be done on digital asset advocacy as well as other key measures.
House Committee Markup
The House Financial Services Committee on Wednesday voted to advance:
- The 1071 Repeal to Protect Small Business Lending Act (H.R. 976), House Small Business Committee Chairman Roger Williams’s (R-Texas) bill to repeal Section 1071 of the Dodd-Frank Act and halt the CFPB’s data collection and reporting rule for small-business loans.
- The Promoting New Bank Formation Act (H.R. 478), Subcommittee on Financial Institutions Chair Andy Barr’s (R-Ky.) bill directing regulators to address excessive regulatory burdens hindering the formation of de novo community banks.
- The Anti-CBDC Surveillance State Act (H.R. 1919), House Majority Whip Tom Emmer’s (R-Minn.) bill to bar the Federal Reserve from issuing a U.S. central bank digital currency to consumers.
A String of Advocacy Successes
ICBA has for years pushed to advance these policies, including as part of our 1071 efforts going back well over a decade, though they are just the latest community bank advocacy successes of the new Congress and administration.
For instance, in the past week alone the Senate passed legislation to overturn the CFPB’s overdraft rule, federal regulators announced plans to rescind their Community Reinvestment Act rule, the Securities and Exchange Commission withdrew the legal defense of its rule requiring climate-related disclosures, and the Trump administration issued an executive order on the Treasury Department’s use of paper checks to combat check fraud.
These successes follow earlier announcements that Michelle Bowman has been nominated for Fed vice chair for supervision and the FDIC has rescinded proposed rules on brokered deposits, corporate governance, and incentive-based compensation, among other positive developments.
Digital Assets Update
As reported by ICBA in today’s NewsWatch Today, the years-long debate over legislation establishing a regulatory framework for currently unregulated stablecoins has accelerated in Congress and is supported by the Trump administration.
In our advocacy, including in statements for Senate Banking and House Financial Services committee markups, ICBA has emphasized that stablecoin regulatory frameworks must address the following key issues to manage stablecoin risks without disintermediating community banks and disrupting economic stability:
- Mitigate deposit risk by limiting nonbank stablecoin issuers’ ability to engage in bank-like activities and ensuring opportunities for community banks.
- Preserve the integrity of Federal Reserve Master Accounts by preventing nonbank access.
- Protect the separation of banking and commerce by preventing commercial and Big Tech stablecoin issuance and dominance.
- Limit regulatory arbitrage by applying consistent standards to banks and nonbanks.
Currently, the Senate GENIUS Act and House STABLE Act, which the House Financial Services Committee advanced on Wednesday, contain provisions to address some of these concerns, including not granting Federal Reserve Master Accounts to nonbank issuers, disallowing payment yield or interest on stablecoins, and permitting community banks to utilize payment stablecoin reserve funds held as deposits to carry out the business of banking. However, ICBA will continue its efforts urging lawmakers to include additional guardrails to protect community bank deposits, ensuring the necessary credit they provide to their communities is not jeopardized.
Join Us for the ICBA Capital Summit
But our work doesn’t end there. Policymakers in Washington need to hear from you on critical tax relief for rural America, extending key provisions of the Tax Cuts and Jobs Act, prohibiting disruptive trigger leads, and repealing other harmful regulation to ensure appropriate tailoring.
To continue our advocacy efforts and consolidate our successes, I strongly encourage you to attend next month’s ICBA Capital Summit in Washington, D.C. Scheduled for May 12-15, the ICBA Capital Summit features in-person meetings with congressional offices, empowering community bankers to make our voices heard on Capitol Hill.
Thank you for all you are doing to make a positive difference in Washington while continuing to meet the needs of your local communities. By continuing to work together, we can expand on these policy successes to strengthen the local communities we serve.
