Federal regulators will examine mid-sized banks half as often
S. 3830 — TRUST Act of 2026 · Filed by Ted Budd (R-NC) · 6 cosponsors · Introduced Feb 11, 2026 · Referred to committee
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What it does
This bill doubles the asset threshold for small-bank examination frequency from $3 billion to $6 billion. Banks under $6 billion in assets must now be examined by federal regulators at least once every 18 months instead of annually. Smaller banks benefit by facing less frequent regulatory scrutiny; federal banking agencies lose examination authority over a larger cohort of institutions.
Why we flagged it
The bill's operative mechanism is a straightforward reduction in examination frequency for a defined class of institutions. It is not disguised or misdirected, but it is functionally a deregulatory measure that reduces federal oversight of mid-sized banks.
What the text implies
- Banks in the $3B–$6B asset range will face 50% fewer mandatory federal examinations, potentially delaying detection of unsafe lending, capital, or liquidity problems until they become systemic.
- The 18-month cycle aligns with the examination frequency for larger, well-capitalized banks, effectively treating mid-sized institutions as lower-risk than current law assumes.
The full analysis lists 3 implications of this text.
Who stands to gain
community banks and regional banks with $3B–$6B in assets; bank holding companies in that asset range