Merchant Banking Modernization Act

This bill changes banking rules so certain bank groups can keep their “merchant banking” investments for a longer time—up to 15 years. In simple terms, it lets bank-affiliated companies hold stakes in non-bank businesses for a longer period before they have to sell them, by updating the Bank Holding Company Act of 1956.

Key points

• Who is affected: Bank holding companies and the businesses they invest in.
• What changes: Allows holding merchant banking investments for up to 15 years, generally extending how long these investments can be kept.
• What it means: Could give investors more time to support and grow companies before exiting, under existing safeguards in federal law.