On July 21, 2026, the U.S. House of Representatives passed the Main Street Capital Access Act (H.R. 6955), bipartisan legislation intended to promote new bank formation, reduce regulatory burdens for community banks, and improve access to banking services in rural communities.
If passed by the Senate and signed into law, the legislation would make significant changes affecting community banks, de novo financial institutions, bank holding companies, and federal banking regulation.
Below is an overview of the bill’s key provisions and their potential impact on financial institutions.
New Bank Formation and Community Banking Access
Title I of the Act introduces a three-year phased-in period for de novo institutions to meet applicable capital requirements, making it easier for newly-established banks to meet these thresholds by gradually increasing them over the three-year period.
Title I also requires that federal banking agencies issue a public report on charter applications to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate. This aims to increase transparency by requiring regulators to report on matters such as how many bank applications they receive, how long approvals take, and reasons applications are denied, resulting in the chartering process becoming more predictable.
How the Main Street Act Tailors Bank Regulation
Title II of the Act requires that each federal financial regulatory agency take into consideration the “risk profile and business models of each type of institution or class of institution subject to regulatory action” and tailor any regulatory action to limit the regulatory impact, including cost or other burdens, accordingly. The Act also raises the asset threshold to quality as a Small Bank Holding Company from $3 billion to $6 billion and increases eligibility for the Community Bank Leverage Ratio framework from $10 billion to $15 billion.
Changes to CAMELS Ratings and Transparent Banking Supervision
Title III of the Act attempts to modernize the CAMELS (Capital adequacy, Asset Quality, Earnings, Liquidity, and Sensitivity to market risk) rating system and reduce examiner discretion, reducing subjectivity and inconsistency across institutions. Title III orders examiners to amend the CAMELS rating system to establish clearer, more objective criteria and more transparent methodologies. This part of the Act also establishes an Office of Independent Examination Review, made up of a board appointed by the President, to handle regulatory disputes and complaint investigations.
Regulatory Accountability and Transparency
Title IV of the Act attempts to increase transparency, accountability, and procedural fairness by limiting discretionary regulatory practices. The Title restructures the composition of the FDIC Borad of Directors by replacing the current independent director with four presidentially appointed, Senate-confirmed members. This Title also prohibits federal banking regulatory agencies from using informal guidance, supervisory letters, or similar documents as the basis for enforcement actions unless the underlying regulations are established through law or other formal regulation. Finally, Title IV requires regulators to conduct periodic reviews of existing regulations to identify outdated, duplicative, or unnecessarily burdensome requirements.
Changes Affecting Community Bank Funding
Title V of the Act directs the Federal Reserve Board to conduct a comprehensive review of the Federal Reserve Board’s discount window to identify deficiencies, work with regional Federal Reserve Banks, and report to Congress. Title V also expands the amount of reciprocal deposits that qualifying institutions may exclude from the definition of “brokered deposits” by utilizing a dynamic threshold tied to the institution’s total liabilities. It also expands which custodial deposits are treated as brokered deposits.
Community Bank Mergers and Competition
Title VI simplifies the process for merger and acquisition transactions where the resulting companies have less than $10 billion in assets and streamlines the process for merger approval by providing deadlines for regulators to follow.
Why It Matters
The Bill is currently set to be voted on by the Senate after receiving bipartisan support in the House. The Main Street Capital Access Act represents one of the most significant efforts in recent years to change federal banking regulations in favor of community banks, rural financial institutions and new bank formation.
For additional information about the Main Street Capital Access Act or other banking regulatory developments, please contact Collyn DuBose.
Collyn DuBose counsels clients in a range of industries on commercial disputes, contract negotiations, and regulatory issues.