Should Congress allow fast-track approval for bank merger applications?
This joint resolution would cancel a rule made by the Office of the Comptroller of the Currency (OCC), which is the part of the Treasury Department that oversees banks. The rule changed how the government reviews applications when banks want to merge. Under the new rule, the OCC made the process stricter. It got rid of a fast-track approval option that some bank mergers used before and asked banks to provide more detailed information up front. The goal was to give regulators more time and tools to look closely at how a merger might affect competition, financial stability, and local communities.
Sponsor: Sen. John Kennedy (Republican, Louisiana)
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Opponents say
• "The National Community Reinvestment Coalition (NCRC) appreciates the opportunity to comment on proposed changes to the OCC’s regulations regarding Business Combinations Under the Bank Merger Act. Bank mergers profoundly impact banks’ capacities to serve the convenience and needs of communities. If the federal bank agencies do not adopt robust reviews of bank merger applications, mergers are likely to harm communities through reductions in loans, branches, and loss of jobs. On the other hand, banks will be able to improve their capacity to serve communities if the agencies ensure that mergers preserve banks’ institutional structures and commitments for lending and investing in all communities and do not create markets without effective competition." Source: NCRC
Proponents say
• "Well, President Biden’s people at the OCC decided that [the rule] wasn’t broken; so they were going to fix it. Again, I don’t hate anybody, but you have got to call it like you see it. I think the folks at President Biden’s OCC got up one day and thought there was an award for being stupid. They took this very simple and effective rule and procedure, and they turned it on its head. What they did was tier-one level moronic. [...] I am going to ask the Senate to reject President Biden’s cumbersome rule. . . . That doesn’t mean that the OCC can’t revisit it at some point, but let me just be blunt: What President Biden’s OCC people did was put together a plan—a new rule—that looks like it was put together by a heroin addict with a socket wrench. I mean, it is the most convoluted thing you have ever seen. If we vote yes today—and I hope we do—then we will reject this rule and go back to doing it the old way." Source: Sen. John Kennedy (Republican, Louisiana), the sponsor of this resolution
• "ABA has long believed that bank mergers should be subject to clear and transparent standards, and that regulators should act in a timely and fair manner when considering applications. Unfortunately, the final rule the OCC approved last September created unhelpful and biased new standards—including arbitrary asset thresholds—without providing the clarity and predictability that banks and their customers need. We applaud today’s Senate passage of the Congressional Review Act resolution nullifying the OCC’s merger rule and thank Sen. Kennedy for his leadership on this important issue. We now urge the House to quickly pass the companion resolution introduced by Rep. Andy Barr so regulators can correct this flawed rule and establish a new framework that reflects today's financial services landscape and promotes competition that strengthens our financial system." Source: Rob Nichols, President and CEO of the American Bankers Association
- Senate passes Kennedy resolution to undo cumbersome Biden-era bank merger rule (Press Release)
- OCC Reinstates Streamlined Bank Merger Review Process (StepToe)
- Bank Mergers: Recent Policy Changes (Reuters)
- Breaking Down the Bank Merger Review Process (Bank Policy Institute)
- Sen. John Kennedy’s Biggest Donors (OpenSecrets)
