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July 14, 2026
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Download official House Record PDFReturn to issue contextMr. HILL of Arkansas. Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 6556) to prohibit the use of certain concentration limit exceptions with respect to mergers involving a failed bank unless the applicable agency determines such use is necessary to prevent significant economic disruption or significant adverse effects on financial stability, and for other purposes, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 6556
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 “Failing Bank Acquisition
Fairness Act”.
SEC. 2. CONCENTRATION LIMIT EXCEPTIONS ONLY AVAILABLE TO
AVOID SERIOUS ADVERSE ECONOMIC OR FINANCIAL
EFFECTS.
(a) Concentration Limits With Respect to Deposits.—
(1) Federal deposit insurance act.—The Federal Deposit
Insurance Act (12 U.S.C. 1811 et seq.) is amended—
(A) in section 18(c)(13)—
(i) by amending subparagraph (B) to read as follows:
“(B) Subparagraph (A) shall not apply to an interstate
merger transaction if—
“(i) such interstate merger transaction involves 1 or more
insured depository institutions in default or in danger of
default and the responsible agency determines, based on clear
and convincing evidence, that consummation of the proposed
interstate merger transaction is necessary to prevent
significant economic disruption or significant adverse
effects on financial stability, and the Corporation has not
received any qualified bid from a company that is not subject
to the prohibition in subparagraph (A); or
“(ii) the Corporation provides assistance under section 13
to facilitate such interstate merger transaction and the
responsible agency determines, based on clear and convincing
evidence, that consummation of the proposed interstate merger
transaction is necessary to prevent significant economic
disruption or significant adverse effects on financial
stability, and the Corporation has not received any qualified
bid from a company that is not subject to the prohibition in
subparagraph (A).”; and
(ii) in subparagraph (C)—
(I) in clause (i), by striking “and” at the end;
(II) in clause (ii), by striking the period at the end and
inserting a semicolon; and
(III) by adding at the end the following:
“(iii) the term `qualified bid' means an application,
proposed application, or bid from a company where—
“(I) if applicable, the company, any affiliate insured
depository institution, and any affiliate depository
institution holding company is well capitalized and well
managed, as of the date of the application, proposed
application, or bid; and
“(II) upon consummation of the transaction, the resulting
insured depository institution is well capitalized;
“(iv) the term `well capitalized'—
“(I) with respect to an insured depository institution,
has the meaning given such term in section 38(b) (12 U.S.C.
1831o(b));
“(II) with respect to a bank holding company, has the
meaning given such term in section 2(o)(1)(B) of the Bank
Holding Company Act of 1956 (12 U.S.C. 1841(o)(1)(B));
“(III) with respect to a savings and loan holding company,
has the meaning given such term in section 238.2 of title 12,
Code of Federal Regulations; and
“(IV) with respect to a company that is not an insured
depository institution, bank holding company, or savings and
loan holding company, means maintaining equity capital that
the Corporation determines is commensurate with the capital
maintained by an insured depository institution that is well
capitalized; and
“(v) the term `well managed' has the meaning given such
term in section 2(o)(9) of the Bank Holding Company Act of
1956 (12 U.S.C. 1841(o)(9)).”; and
(B) in section 44, by amending subsection (e) to read as
follows:
“(e) Exception for Banks in Default or in Danger of
Default.—
“(1) General exception.—The responsible agency may,
without regard to paragraph (1), (3), (4), or (5) of
subsection (b) or paragraph (2), (4), or (5) of subsection
(a), approve an application under subsection (a)(1) for
approval of a merger transaction if—
“(A) the merger transaction involves 1 or more banks in
default or in danger of default; or
“(B) the Corporation provides assistance under section
13(c) to facilitate such merger transaction.
“(2) Concentration limit exception.—The responsible
agency may, without regard to subsection (b)(2), approve an
application under subsection (a)(1) for approval of a merger
transaction if—
“(A) the merger transaction involves 1 or more banks in
default or in danger of default and the responsible agency
determines, based on clear and convincing evidence, that
consummation of the proposed interstate merger transaction is
necessary to prevent significant economic disruption or
significant adverse effects on financial stability, and the
Corporation has not received any qualified bid from another
institution that is not subject to the prohibition in
subsection (b)(2); or
“(B) the Corporation provides assistance under section
13(c) to facilitate such merger transaction and the
responsible agency determines, based on clear and convincing
evidence, that consummation of the proposed interstate merger
transaction is necessary to prevent significant economic
disruption or significant adverse effects on financial
stability, and the Corporation has not received any qualified
bid from another institution that is not subject to the
prohibition in subsection (b)(2).
“(3) Qualified bid defined.—In this subsection, the term
`qualified bid' has the meaning given that term in section
18(c)(13)(C).”.
(2) Bank holding company act of 1956.—The Bank Holding
Company Act of 1956 (12 U.S.C. 1841 et seq.) is amended—
(A) in section 3(d), by amending paragraph (5) to read as
follows:
“(5) Exception for banks in default or in danger of
default.—
“(A) General exception.—The Board may, without regard to
subparagraph (B) or (D) of paragraph (1) or paragraph (3),
approve an application pursuant to paragraph (1)(A) if—
“(i) the application is for an acquisition of 1 or more
banks in default or in danger of default; or
“(ii) the application is for an acquisition with respect
to which assistance is provided under section 13(c) of the
Federal Deposit Insurance Act.
“(B) Concentration limit exception.—The Board may,
without regard to paragraph (2), approve an application
pursuant to paragraph (1)(A) if—
“(i) the application is for the acquisition of 1 or more
banks in default or in danger of default and the Board
determines, based on clear and convincing evidence, that
consummation of the proposed acquisition is necessary to
prevent significant economic disruption or significant
adverse effects on financial stability, and the Corporation
has not received any qualified bid from another institution
that is not subject to the prohibition in paragraph (2); or
“(ii) the application is for an acquisition with respect
to which assistance is provided under section 13(c) of the
Federal Deposit Insurance Act and the Board determines, based
on clear and convincing evidence, that consummation of the
proposed acquisition is necessary to prevent significant
economic disruption or significant adverse effects on
financial stability, and the Corporation has not received any
qualified bid from another institution that is not subject to
the prohibition in paragraph (2).
“(C) Qualified bid defined.—In this paragraph, the term
`qualified bid' has the meaning given that term in section
18(c)(13)(C) of the Federal Deposit Insurance Act.”; and
(B) in section 4(i)(8), by amending subsection (B) to read
as follows:
“(B) Exception.—Subparagraph (A) shall not apply to an
acquisition if—
“(i) such acquisition involves an insured depository
institution in default or in danger of default and the Board
determines, based on clear and convincing evidence, that
consummation of the proposed acquisition is necessary to
prevent significant economic disruption or significant
adverse effects on financial stability, and the Corporation
has not received any qualified bid (as defined in section
18(c)(13)(C) of the Federal Deposit Insurance Act) from
another institution that is not subject to the prohibition in
paragraph (2); or
“(ii) the Federal Deposit Insurance Corporation provides
assistance under section 13 of the Federal Deposit Insurance
Act to facilitate such acquisition and the Board determines,
based on clear and convincing evidence, that consummation of
the proposed acquisition is necessary to prevent significant
economic disruption or significant adverse effects on
financial stability, and the Corporation has not received any
qualified bid (as defined in section 18(c)(13)(C) of the
Federal Deposit Insurance Act) from another institution that
is not subject to the prohibition in paragraph (2).”.
(b) Concentration Limit With Respect to Consolidated
Liabilities.—Section 14(c) of the Bank Holding Company Act
of 1956 (12 U.S.C. 1852(c)) is amended—
(1) by redesignating paragraphs (1), (2), and (3) as
subparagraphs (A), (B), and (C), respectively;
(2) by striking “With the” and inserting the following:
“(1) In general.—With the”; and
(3) by adding at the end the following:
“(2) Limitation.—The Board may provide written consent
for an acquisition described in paragraph (1)(A) or in
paragraph (1)(B) only if the Board determines, based on clear
and convincing evidence, that consummation of the proposed
acquisition is necessary to prevent significant economic
disruption or significant adverse effects on financial
stability, and the Corporation has not received any qualified
bid (as defined in section 18(c)(13)(C) of the Federal
Deposit Insurance Act) from another institution that is not
subject to the prohibition in subsection (b).”.
SEC. 3. CONGRESSIONAL NOTIFICATION AND JUSTIFICATION FOR
WAIVERS.
(a) In General.—Whenever the Board of Governors of the
Federal Reserve System, the Comptroller of the Currency, or
the Federal Deposit Insurance Corporation waives a
concentration limit under section 18(c)(13)(B) or section
44(e) of the Federal Deposit Insurance Act or under section
3(d)(5), section 4(i)(8)(B), or section 14(c)(2) of the Bank
Holding Company Act of 1956, in connection with the
acquisition of a bank or insured depository institution in
default or in danger of default, or in connection with an
acquisition with respect to which the Federal Deposit
Insurance Corporation provides assistance under section 13 of
the Federal Deposit Insurance Act, the waiving agency and the
Federal Deposit Insurance Corporation, jointly, shall, not
later than 30 days after such waiver, submit a written report
to the Committee on Financial Services of the House of
Representatives and the Committee on Banking, Housing, and
Urban Affairs in the Senate containing—
(1) a justification for the waiver, including an analysis
of why it was necessary to prevent significant economic
disruption or significant adverse effects on financial
stability;
(2) a description of alternative bids or outcomes
considered, including efforts to solicit and encourage bids
from entities that would not require a waiver;
(3) an explanation of why alternative bids were not
selected, if applicable; and
(4) any recommendations for legislative or regulatory
changes to improve competition in future insured depository
institution resolutions.
(b) Public Disclosure.—The waiving agency submitting a
report under subsection (a) and the Federal Deposit Insurance
Corporation shall make the report publicly available on their
respective websites, subject to redactions for confidential
supervisory information and any other information described
under section 552(b) of title 5, United States Code.
SEC. 4. LIMITATION ON CONSIDERING BAD FAITH BIDS IN LEAST
COST DETERMINATION.
Section 13(c)(4) of the Federal Deposit Insurance Act (12
U.S.C. 1823(c)(4)) is amended by adding at the end the
following:
“(I) Limitation on considering bad faith bids.—In making
a determination under this paragraph of whether an exercise
of authority is the least costly to the Deposit Insurance
Fund, any application, proposed application, or bid that
would result in violation of—
“(i) section 18(c)(13) or 44(b)(2), or
“(ii) section 3(d)(2), 4(i)(8), or 14 of the Bank Holding
Company Act of 1956,
shall not be considered a possible method for meeting the
Corporation's obligation under this section for purposes of
subparagraph (A).”.
SEC. 5. DISCRETIONARY SURPLUS FUND.
(a) In General.—The dollar amount specified under section
7(a)(3)(A) of the Federal Reserve Act (12 U.S.C.
289(a)(3)(A)) is reduced by $2,000,000.
(b) Effective Date.—The amendment made by subsection (a)
shall take effect on September 1, 2036.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from Arkansas (Mr. Hill) and the gentleman from Massachusetts (Mr. Lynch) each will control 20 minutes.
The Chair recognizes the gentleman from Arkansas.
General Leave
Mr. HILL of Arkansas. Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days to revise and extend their remarks and include extraneous material on this legislation.
The SPEAKER pro tempore. Is there objection to the request of the gentleman from Arkansas?
There was no objection.
Mr. HILL of Arkansas. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I include in the Record the Congressional Budget Office score for this bill.
EFFECTS ON DIRECT SPENDING AND REVENUES OF LEGISLATION CONSIDERED UNDER SUSPENSION OF THE RULES IN THE HOUSE OF REPRESENTATIVES WEEK OF JULY 13, 2026 ————————————————————————————————————————————————————————————————————————————
Additional
Effect on Direct Information on Suspension Bill
Bill Number Title Spending Effect on Revenues Direct Spending and Text at
Revenue Effects doc.house.gov ———————————————————————————————————————————————————————————————————————————— H.R. 6556........................ Failing Bank Increase by at Increase by at Would increase ........... https:// Acquisition Least $500K. Least $500K. direct spending by docs.house.gov/
Fairness Act, as $1 million, billsthisweek/
amended. increase revenues 20260713/
by $1 million, and HR6556_SUSxml.pdf
result in no
increase in the
deficit. ————————————————————————————————————————————————————————————————————————————
Mr. HILL of Arkansas. Mr. Speaker, I rise in strong support of H.R. 6556, the Failing Bank Acquisition Fairness Act, offered by my friend from Massachusetts.
depositors, preserve confidence in our financial system, consider potential buyers, and minimize disruption to families, businesses, and communities. All of that often takes place in a very short period of time, between Friday at close of business and Monday morning at opening for business. At that same time, those decisions should be made by a process that is fair, transparent, and promotes competition.
approving a merger or acquisition of a failed or failing bank if the resulting institution would control more than 10 percent or more of deposits nationwide.
under certain circumstances. H.R. 6556 restricts when those concentration limits can be waived to situations in which there are no other qualified bidders for that failed bank and the transaction is necessary to prevent significant economic disruption or adverse effects on U.S. financial stability.
This legislation helps address concentration in the U.S. banking sector and promote a more transparent, competitive, and accountable approach to resolving failing banks. This legislation includes critical guardrails, such as requiring regulators to report to Congress within 30 days of a waiver on why the waiver was granted, why other qualified alternatives were not selected, and any recommendations for legislative or regulatory changes to improve competition for future bank resolutions.
the best interests of depositors; our financial system at large; and, of course, the American people. This is a practical, bipartisan reform that strengthens oversight, promotes competition, and reinforces confidence in the bank resolution process, while preserving regulators' ability to respond to bank failures.
Mr. Speaker, I thank my friend from Massachusetts (Mr. Lynch) for his leadership on this legislation, and I urge my colleagues on both sides of the aisle to support H.R. 6556.
Mr. Speaker, I reserve the balance of my time.
Mr. LYNCH. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I rise in support of H.R. 6556, the Failing Bank Acquisition Fairness Act, which I introduced in December 2025.
Mr. Speaker, I thank the gentleman from Arkansas (Mr. Hill) and the gentlewoman from California (Ms. Waters), our ranking member, who advanced this legislation unanimously within the committee.
megabanks from dominating the bidding process for acquiring a failed bank if there are other eligible bids from well-capitalized and well- managed small and midsized banks.
declined in this country by approximately 50 percent, hollowing out the small and midsized institutions that have traditionally housed local community capital.
institutions in the failed bank acquisition process, even when attainable opportunities arise which might result in a more favorable result for depositors and impacted businesses and communities.
Valley Bank, and Signature Bank in 2023, which were the second, third, and fourth largest bank failures in U.S. history, as part of the resolution process, Federal regulators, including the FDIC, structured an immensely favorable acquisition process to allow JPMorganChase, America's biggest bank at the time, to acquire the nearly $230 billion in assets and $103 billion in deposits from the failed First Republic Bank.
failed to compete with J.P. Morgan's sheer asset holdings, estimated to be close to $4 trillion.
{time} 1510
In fact, the FDIC agreed to absorb 80 percent of all credit losses. After effectively winning the government auction, J.P. Morgan quickly announced plans to shut down one quarter of First Republic's 84 branches rather than preserving consumer access to their local branches. The closure also led to the firing of approximately 1,000 bank employees.
exception. This year, U.S. bank mergers and acquisitions have hit a 7- year high, up 45 percent since 2024.
Reform and Better Markets have raised serious concerns about the advantages afforded to large interconnected financial institutions like JPMorganChase in bidding for these failing banks, and as a result growing ever larger while accelerating the process of consolidation.
Acquisition Fairness Act, which if it were law at the time would have created a more level playing field between healthy medium-sized as well as larger banks to both stabilize markets but also to better serve depositors, businesses, and the impacted communities in which those banks are located while avoiding megabanks gobbling up smaller banks in the steady march toward consolidation.
competition and improving the resilience of our financial system from economic shocks.
every Democrat, every Republican, and has the support of Americans for Financial Reform to boot.
Mr. Speaker, I urge my colleagues on both sides of the aisle to support this legislation, and I reserve the balance of my time.
Mr. HILL of Arkansas. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I join my friend from Massachusetts in speaking to the importance of this bill and provide just a couple of minutes of perspective.
crisis, the oil and gas lending crisis, and the real estate lending crisis culminating in the late 1980s with really the collapse of
supervision and too lax management of these institutions. In both large banks like the famous Continental Illinois failure in Chicago to some of the large thrifts, the government chose to keep banks open rather than closing them by essentially taking a note back called open bank assistance. It essentially increased the losses to the taxpayers.
other related bank failures of the 1980s and very early 1990s, the government said, look, this is out of hand, and we want to enforce a least cost resolution process when a bank fails, meaning we don't want to lose more money after the closing by trying to keep these banks open.
thus the least cost to the taxpayers, was the winner, which is good policy. However, now it is 30 years later, and the largest banks in the country, as outlined by the gentleman from Massachusetts (Mr. Lynch), have a disproportionate ability to bid $1 more and thus be the least cost to the taxpayer—or maybe after the last debate one penny more— and be the least cost to the taxpayer. That means that it is very hard to compete with them.
What the gentleman from Massachusetts (Mr. Lynch) has proposed is let us have more bidding for those failed banks by crafting a process that is transparent that Congress oversees, Congress outlines the guardrails, where smaller banks could team up with other capital sources and bid for one of those failed banks and end up being in a much more competitive process. What the government gets is a more diversified, more competitive banking system instead of the default winner being one of the big five existing financial institutions.
I thank the gentleman from Massachusetts (Mr. Lynch) for his work on this legislation. I thank Chairman Barr of our Financial Institutions Subcommittee and Ranking Member Waters for bringing our bipartisan team together on the committee in advancing this bill.
Mr. Speaker, I urge Members on both sides of the aisle to vote “yes” on this measure. I reserve the balance of my time.
Mr. LYNCH. Mr. Speaker, I yield myself the balance of my time.
astute observations on the circumstances that have brought us to this point. I will add that I believe this morning it was announced that JPMorganChase, which was the benefactor of this previous transaction, is now approaching $5 trillion in assets. That is indeed remarkable. Their market cap is about a trillion dollars, as well.
megabanks to acquire failing banks even when other eligible, well- managed small and midsize banks have submitted competing bids improving community and regional bank competitiveness and preventing further consolidation among our largest financial institutions.
Mr. HILL of Arkansas. Mr. Speaker, I urge a “yes” vote on the bill. I appreciate the work on both sides of the aisle, and I yield back the balance of my time.
The SPEAKER pro tempore. The question is on the motion offered by the gentleman from Arkansas (Mr. Hill) that the House suspend the rules and pass the bill, H.R. 6556, as amended.
The question was taken; and (two-thirds being in the affirmative) the rules were suspended and the bill, as amended, was passed.
A motion to reconsider was laid on the table.