Bankers Group Backs Bill to Adjust Regulatory Limits

The American Bankers Association is urging the Senate to pass the TIER Act to modernize statutory banking thresholds.

Updated on Oct. 16, 2026 in Banking

Bold flat-color editorial illustration featuring a heavy geometric vault mechanism, symbolizing regulatory thresholds in the banking sector. — The American Bankers Association is backing the TIER Act, which proposes updating statutory banking asset thresholds to encourage community investment. AI Illustration. Upload story photo >

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Should federal banking regulatory thresholds automatically adjust to keep pace with economic growth?

The American Bankers Association has officially expressed support for the TIER Act, a bill introduced by Senator Katie Britt. This legislation seeks a one-time adjustment to banking asset thresholds while mandating future updates to support economic growth.

Why it matters

Industry leaders argue that current statutory thresholds discourage organic growth and limit the amount of capital available for community investment across the United States.

S. 5452 proposes a one-time reset of banking asset thresholds and requires the Federal Reserve to establish a framework for periodic economic adjustments.

The players

American Bankers Association

This organization serves as the primary trade association for the United States banking industry.

Katie Britt

She serves as a United States Senator from Alabama and is the primary sponsor of the TIER Act.

The details

The bill requires the Federal Reserve to determine whether nominal gross domestic product or the consumer price index should serve as the standard for maintaining thresholds. This proposal follows a modified version passed by the House earlier this year as part of the Main Street Capital Access Act.

Earlier this year: The House passed a modified version of the bill as part of the Main Street Capital Access Act.

Market Dynamics

The push for the TIER Act follows the legislative trajectory set by the Main Street Capital Access Act, reflecting a broader trend of recalibrating banking regulations to better align with contemporary economic conditions.

The potential shift in asset-based regulatory thresholds could influence the capital management strategies of regional and community banks. Retail investors may see changes in how these institutions allocate resources for local lending and community-focused investments.

The takeaway

Advocates believe that tying regulatory thresholds to economic indicators will provide the stability needed for long-term institutional growth. This approach reflects a transition away from fixed statutory limits toward a more dynamic regulatory framework.