Fed's climate-risk oversight stripped in transparency bill
H.R. 5270 — Stress Testing Accountability and Transparency Act · Filed by Bill Huizenga (R-MI) · 2 cosponsors · Introduced Sep 10, 2025 · Reported out
Your members of Congress
Enter a ZIP to see where your representative and both senators stood on this bill.
Looked up on this device — your ZIP is never stored on our servers.
What it does
This bill requires the Federal Reserve to publish the specific models, assumptions, and scenarios it uses to stress-test large banks and financial companies, and to make those methodologies transparent through formal rulemaking. It also prohibits the Fed from conducting climate-related stress tests and mandates a GAO audit every three years to assess whether stress tests actually measure financial stability.
Why we flagged it
The bill's primary mechanism is transparency and accountability (requiring Fed rulemaking and public disclosure of stress-test methodologies), but it carries a substantive constraint: a prohibition on climate-related stress testing that narrows the Fed's supervisory toolkit independent of the transparency goal.
- Prohibition on climate-related stress testing (Section 3) is substantively unrelated to transparency/accountability mandate; it is a deregulatory rider.
What the text implies
- The climate-stress-test prohibition may prevent the Fed from assessing whether large financial institutions face material losses from climate-related asset devaluation, stranding, or liability—a gap that could leave systemic risk unmonitored.
- Requiring the Fed to disclose stress-test scenarios 60 days in advance may allow sophisticated market participants to front-run or game the tests, potentially reducing their effectiveness as a safety measure.
The full analysis lists 4 implications of this text.
Who stands to gain
large bank holding companies and nonbank financial companies subject to stress testing (AIG, Prudent; financial institutions with climate-exposed assets or liabilities