Sponsors (2)
The bill reduces exam burden and increases predictability for well‑managed small banks and credit unions, at the cost of potentially greater safety and consumer‑protection risks and some transition or oversight costs for institutions and taxpayers.
Insured small banks and credit unions (assets ≤ $6B) will face fewer and shorter on‑site exams, reducing staff time, operational disruption, and compliance costs for those institutions.
Combining multiple exam types on request and streamlining exams reduces duplicative examiner visits and lowers disruption for institutions and their customers.
Agencies must give advance notice of expected exam issues and report aggregate exam metrics to Congress, improving predictability for institutions and transparency/oversight of exam practices for smaller institutions.
Depositors and consumers at qualifying institutions face increased risk because reduced on‑site scrutiny and fewer examiner hours may miss emerging safety or compliance problems between exams.
Narrowing exam frequency and providing advance notice can reduce visibility into consumer compliance issues and allow institutions to temporarily mask violations, delaying detection and enforcement.
Smaller institutions may face transition and ongoing administrative costs to document and maintain a 'well‑managed' status and to implement or respond to new rulemaking requirements.
Based on analysis of 3 sections of legislative text.
Allows eligible, well‑managed and well‑capitalized banks and credit unions with ≤ $6B to receive alternating limited‑scope exams and request combined exams, with new agency rules and reporting.
Introduced July 16, 2025 by William R. Timmons · Last progress May 13, 2026
Allows certain small, well-managed, well-capitalized insured banks and credit unions (those with $6 billion or less in consolidated assets) to receive alternating limited-scope examinations after a full-scope, on-site exam and to request combined examinations (safety-and-soundness, consumer compliance, and/or IT/cybersecurity) be done at the same time. Agencies retain authority to perform off‑site monitoring, targeted reviews, or full on‑site exams when needed and two exceptions block relief: an active formal enforcement action or a change in control since the last full exam. Requires federal banking agencies and the NCUA to issue rules within 12 months to implement the new limited‑scope exam option and off‑cycle review procedures, and imposes new exam practice standards and annual reporting requirements (examiner experience, number of examiners, on‑site time, and compliance information) for institutions under the $6 billion threshold.