House Republicans on Tuesday passed legislation to rescind a Biden-era policy meant to more closely scrutinize proposed bank mergers, sending the regulatory rollback to President Donald Trump’s desk.
The House voted 220-207 to nullify a new rule finalized by the Office of the Comptroller of the Currency last September that created a tougher regulatory process for banks seeking to merge.
The GOP repeal measure cleared the Senate earlier this month on a 52-47 vote, which was also divided along party lines.
The legislation, which now awaits Trump’s signature, is poised to have little immediate practical impact because the Trump administration earlier this month already scrapped the Biden-era rule. But the repeal, which Republicans advanced under the Congressional Review Act, will also prohibit any administration in the future from pursuing a “substantially similar” regulation on bank mergers.
Rep. Andy Barr (R-Ky.), speaking on the House floor before the vote, dismissed Democrats’ criticism that the effort was a waste of time. He said that the resolution was an “insurance policy” against “bad regulators” in the future.
Barr, who sponsored the House resolution, said that easier and quicker regulatory approvals for bank mergers would help boost financial stability and allow smaller regional banks to better compete against Wall Street giants.
The Biden-era OCC rule scrapped an expedited path for banks seeking to merge, eliminating a long-standing practice that allowed mergers to be approved simply because regulators had not acted on the application.
The rollback of the policy is the latest sign that Republican control of Washington will create a much more permissive climate for bank mergers. Bank industry groups and GOP lawmakers sharply criticized the Biden administration’s concerted effort, across multiple regulators, to crack down on consolidation in the financial services industry.
Trump-era regulators have already approved a major bank combination, greenlighting last month Capital One’s $35 billion bid to acquire Discover. And other key agencies, like the Federal Deposit Insurance Corporation, have already moved to scrap other Biden-era bank merger rule that required regulators that take a more expansive view of how a proposed deal may affect competition.
Rep. Maxine Waters, the top Democrat on the House Financial Services Committee, blasted the Republican rollback of the merger policy on Tuesday, arguing that it would allow banks to grow larger without guardrails to protect consumers.
“The customers are the victims of these big mergers,” Waters said on the House floor before the vote.
