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H.R. 1116 (115th): TAILOR Act of 2017

H.R. 1116 moves federal financial regulatory agencies that regulate financial institutions away from a static or one-size-fits-all approach when implementing regulations. Specifically, the bill requires the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve, the Federal Deposit Insurance Corporation, the National Credit Union Administration, and the Consumer Financial Protection Bureau to take risk profiles and business models of institutions into account when taking regulatory actions.

The bill requires the federal financial institutions regulatory agencies to take into consideration the risk profile and business models of institutions subject to regulatory action, determine the necessity, appropriateness, and impact of applying that action to such institutions, and tailor regulatory action so as to limit the burden of regulatory compliance as befits the risk profile and business model involved.

The regulatory agencies are also required to take into account the impact that their regulatory actions have upon the ability of institutions to flexibly serve evolving and diverse customer needs, the potential unintended impact of examination manuals or other regulatory directives that work in conflict with the tailoring of such regulatory actions, and the underlying policy objectives of the regulatory action and statutory scheme involved.

The federal financial institution regulatory agencies are required to disclose in every notice of a proposed and final rulemaking for a regulatory action how it has applied this Act, and the agencies must apply this act to all regulations adopted in the previous 5 years. Finally, the legislation requires the Federal Financial Institutions Examination Council (FFIEC) to report to Congress on the extent to which regulatory actions tailored pursuant to this Act result in differential regulation of similarly situated institutions of diverse charter types with respect to comparable regulations.

Last updated Apr 2, 2018. Source: Republican Policy Committee

The summary below was written by the Congressional Research Service, which is a nonpartisan division of the Library of Congress, and was published on Mar 14, 2018.

Taking Account of Institutions with Low Operation Risk Act of 2017 or the TAILOR Act of 2017

(Sec. 2) This bill requires federal financial regulatory agencies to: (1) tailor any regulatory actions so as to limit burdens on the institutions involved, with consideration of the risk profiles and business models of those institutions; and (2) report to Congress on specific actions taken to do so, as well as on other related issues. The bill's tailoring requirement applies not only to future regulatory actions but also to regulations adopted within the last seven years.

(Sec. 3) The bill amends the Federal Reserve Act to lower the maximum allowable amount of surplus funds of the Federal Reserve banks.