H.R. 2896 would require the federal banking regulators—the Federal Deposit Insurance Commission (FDIC), the Office of the Comptroller of the Currency (OCC), the National Credit Union Administration (NCUA) and the Federal Reserve Bank—to tailor their regulatory actions to the specific risk profile and business model of financial institutions subject to regulation. That requirement would apply to any new regulatory action and also would require the federal banking regulators to review and revise regulatory actions from the last five years, including those written pursuant to the Dodd Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act). The provision requiring review of previously adopted regulations would probably require additional work by the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC).
CBO estimates that enacting the legislation would increase direct spending by $20 million in 2017, although spending over the 2017-2026 period would be insignificant. CBO also estimates that enacting H.R. 2896 would reduce revenues by $24 million over the 2017-2026 period. Because enacting the bill would affect direct spending and revenues, pay-as-you-go procedures apply. Finally, CBO estimates that reviewing rules issued by the SEC and the CFTC would cost $10 million over the 2017-2021 period; such spending would be subject to the availability of appropriated funds.
CBO estimates that enacting the legislation would not increase net direct spending or on-budget deficits by more than $5 billion in any of the four consecutive 10-year periods beginning in 2027.
H.R. 2896 contains no intergovernmental mandates as defined in the Unfunded Mandates Reform Act (UMRA) and would not affect the budgets of state, local or tribal governments.
CBO expects that the financial regulators (FDIC, OCC, NCUA, and SEC) would increase premiums or fees to offset the costs of implementing the additional regulatory activities required by the bill. Doing so would increase the cost of the existing mandate on entities required to pay those assessments. Based on information from the federal banking regulators and the SEC, CBO estimates that the incremental cost of the mandate would fall well below the annual threshold established in UMRA for private-sector mandates ($154 million in 2016, adjusted for inflation).