ICBA expressed support for legislation to allow federal banking regulators to implement a community bank leverage ratio of 8-8.5% through 2024.
Background: As required by the CARES Act, the agencies lowered the CBLR to 8% in 2020 and 8.5% in 2021, with a 9% rate scheduled to resume next year.
The Bill: The Community Bank Relief Act (H.R. 6145), introduced by Rep. Tracey Mann (R-Kan.), is designed to stave off a lending contraction amid the ongoing disruption of the pandemic.
ICBA Support: In its letter of support, ICBA noted that large deposit holdings due to pandemic relief measures continue to justify CBLR relief, with community bank balances more than doubling between the end of 2019 and mid-year 2021.
More: ICBA has asked the FDIC to extend the 8.5% CBLR requirement and to permanently raise audit and reporting requirement asset thresholds. FDIC Chairman Jelena McWilliams responded that the agency is exploring whether to extend audit and reporting relief while it engages other regulators on additional CBLR flexibility.