Us Congress House Bill HB4437

Us Congress 2025-2026 Regular Session

• Introduced: 7/16/25
• Refer: 7/16/25
• Report Pass: 7/22/25

Caption

SMART Act of 2025 Supervisory Modifications for Appropriate Risk-based Testing Act of 2025

Impact

If enacted, HB4437 would significantly alter the regularity and depth of examinations that these institutions are subjected to, potentially leading to reduced compliance costs and increased operational efficiency. Proponents argue that the bill will foster a more favorable environment for financial institutions that demonstrate good management and robust capital, allowing them to focus resources more effectively. Meanwhile, the combination of examinations for various compliance areas is expected to simplify the process and make it less burdensome.

Summary

HB4437, known as the Supervisory Modifications for Appropriate Risk-based Testing Act of 2025 or the SMART Act of 2025, aims to reduce regulatory burdens on well-managed and well-capitalized financial institutions with assets of $6 billion or less. The bill proposes changes primarily to the examination process used by federal banking agencies, introducing alternate limited-scope examinations after a full-scope examination to better accommodate the operational needs of smaller institutions. This approach seeks to streamline regulatory oversight while maintaining the safety and soundness of these financial entities.

Contention

Despite its potential benefits, the bill may face criticism from those advocating for stricter oversight in the financial sector. Critics could argue that the reduced examination frequency might inadvertently increase the risk of regulatory lapses, particularly in institutions that handle significant public deposits or operate in volatile markets. Furthermore, there may be concerns that such regulatory changes disproportionately favor larger institutions at the expense of consumer protection and market stability.