Community banks entered 2026 with numerous legislative and regulatory issues in play at the same time. While some are familiar pressure points, others reflect how newer policies and technologies are starting to show up in real proposals and oversight. Here are four issues ICBA’s government relations team is closely engaged in this year.
1. Pushing for Relief from Government Regulations for Community Banks
Regulatory relief for community banks has been a central legislative priority throughout the 119th Congress. Early in the session, the House Financial Services Committee introduced a new agenda that targets compliance pressure through a package of relief measures designed for smaller institutions.
“At the beginning of this Congress, the chairman of the House Financial Services Committee launched an agenda called Make Community Banks Great Again,” says Paul Merski, EVP of congressional relations at ICBA. “With that, we’re pushing a number of legislative packages and bills to reduce the regulatory burden on community banks.”
Progress on this initiative has included House passage of several regulatory relief provisions in the ICBA-advocated community banking title of the Housing for the 21st Century Act (H.R. 6644) as well as the introduction of the comprehensive Main Street Capital Access Act (H.R. 6955) by House Financial Services Committee leaders French Hill and Andy Barr.
“Reducing the regulatory burden is one of our top priorities,” he says. “Passing that legislation through the House and Senate during this Congress would make a real difference.”
Community bankers can support these efforts by engaging directly with lawmakers through ICBA’s Be Heard grassroots action center and by attending the ICBA Capital Summit, scheduled for May 4–7 in Washington D.C.
“When community bankers weigh in directly with members of Congress, it matters,” Merski says. “That engagement helps us speak with a broader, louder voice.”
2. Stablecoin, Digital Assets and Community Bank Compliance
Make your voice heard
Visit icba.org/advocacy for information and tools that will help you lobby your legislators on community banking issues.
The current Congress is closely focused on digital assets market structure legislation, which is intended to establish a regulatory framework for crypto assets and intermediaries. ICBA has been closely engaged with policymakers on stablecoin policies.
“The digital asset space is very broad, but the current focus is on stablecoin,” Merski says. “We’re watching how banks and nonbanks could issue stablecoin and how new legislation and regulation could affect community banks.”
Community banks are paying close attention to proposals that could allow stablecoins to pay interest or yield, which Merski says could disrupt traditional deposit relationships. “We’re particularly focused on making sure stablecoin doesn’t pay interest or yield,” he says. “That could displace community bank deposits if it moves forward.”
ICBA is actively engaged on the legislative front and encourages members to stay informed and involved. “This is an area where bankers really need to get up to speed and weigh in,” Merski says. “We’ve identified specific concerns and provided tools through our grassroots action center, where bankers can engage on both the policy and business implications.”
3. Implementing the GENIUS Act and Government Regulations
Meanwhile, federal regulators have begun the rulemaking process for previous stablecoin legislation, putting the GENIUS Act into focus for community banks in 2026. After Congress passed the law last year, agencies are now drafting proposals that will determine how its provisions apply in practice.
“We’re starting to see regulatory proposals implementing the GENIUS Act, and we expect that to continue throughout the year,” says Lilly Thomas, EVP, regulatory relations and strategy at ICBA.
For community banks, the details of those rules will shape compliance expectations and competitive balance. Thomas says outcomes will depend on how regulators translate statutory language into supervision and oversight.
“The devil’s in the details when it comes to the regulations,” she says. “We want to make sure there’s a level playing field for community banks.”
ICBA is tracking agency rulemaking tied to the GENIUS Act and engaging as proposals emerge. Thomas says community bankers should stay engaged as regulators request feedback and refine their approach.
“This is going to be top of mind as rules take shape,” she says. “How regulators implement the law will matter just as much as the legislation itself.”
4. CFPB Activity Intensifies for Community Banks
Consumer Financial Protection Bureau (CFPB) activity is shaping up as another major focus area for community banks in 2026. Questions around the bureau’s funding remain unresolved, while several high-impact rulemakings continue to move forward.
Two of the most closely watched issues include Section 1071 small business lending data collection and Section 1033 consumer data access. Regulators are expected to release further action on both, which could affect compliance obligations for community banks. ICBA is working to ease regulatory burden as rulemaking advances amid competing pressures from consumer groups and fintech firms.
As agencies develop proposals and seek public input, Thomas emphasizes the importance of member participation.
“As we draft comment letters and responses, we depend on community bankers to weigh in through our grassroots action center,” she says. “Watching for action alerts and responding is very important, and how we make sure the community bank voice continues to be heard.”