Representative Andy Barr (R-KY) has introduced federal legislation to try to encourage de novo banking in underserved areas. We anticipate that H.R. 2561, known as the Promoting Access to Capital in Underbanked Communities Act of 2021, will direct federal regulators to draft rules allowing de novo banks a window of up to three years to meet minimum capital requirements, as well as ease other regulatory burdens. We also expect that bill will direct federal regulators to create a mechanism to facilitate modifications by de novo banks to previously approved business plans, allowing them to be more nimble and entrepreneurial as they attempt to address the needs of new markets. (The text of the bill was not yet available at govtrack.us, however Representative Bar introduced similarly titled legislation that was unsuccessful in 2020.)
According to the Independent Community Bankers Association there have only been 54 de novo banks chartered since 2010, compared to the more than 1,300 between 2000 and the great recession.
Practus will continue to monitor this legislation and provide updates when they are available. You can obtain immediate status updates on the bill by clicking here:.
