Us Congress House Bill HB3234

Us Congress 2025-2026 Regular Session

• Introduced: 5/7/25
• Refer: 5/7/25

Caption

To amend the Federal Deposit Insurance Act to modify the amount of reciprocal deposits of an insured depository institution that are not considered to be funds obtained by or through a deposit broker, and for other purposes.

Impact

If passed, HB 3234 could significantly affect the operations of many financial institutions by modifying how regulatory requirements are calculated. Establishing these different debt thresholds allows smaller and mid-sized banks to have greater flexibility in dealing with reciprocal deposits, potentially fostering a more competitive environment among banks of varying sizes. Proponents of the bill believe that this will help stabilize and sustain smaller banks while ensuring they can continue to function effectively in the financial ecosystem without incurring undue regulatory burdens.

Summary

House Bill 3234 proposes amendments to the Federal Deposit Insurance Act concerning reciprocal deposits held by insured depository institutions. The bill aims to revise the definition of funds obtained by or through a deposit broker, allowing for a more nuanced categorization of reciprocal deposits. It establishes different percentages of total liabilities of the agent institutions that may be excluded from this definition, offering varying thresholds based on the size of the institution's liabilities. This change seeks to create a clearer regulatory framework regarding how these funds are treated in the banking industry, particularly protecting smaller banks from the full impact of being classified as relying on deposit brokers.

Contention

Despite its intentions, HB 3234 has faced scrutiny from various financial oversight groups and regulatory bodies. Concerns have been raised regarding the potential for misuse of these definitions, which could lead to a lack of accountability among financial institutions. Critics argue that the bill may provide loopholes that could be exploited to circumvent critical regulatory safeguards designed to protect the banking system as a whole. Therefore, the discussions surrounding this bill are characterized by a balance between fostering bank growth and ensuring financial stability.