H.R. 4478: Tailored Regulatory Updates for Supervisory Testing Act of 2025

This bill, titled the Tailored Regulatory Updates for Supervisory Testing Act of 2025 or TRUST Act of 2025, proposes changes to the examination cycle for federally insured banks, specifically those with total assets under $6 billion. Here are the main points of the bill:

Examination Cycle Adjustment

Currently, federal banking agencies are required to examine certain insured banks with total assets exceeding $3 billion more frequently. This bill seeks to increase that asset threshold from $3 billion to $6 billion. The key provisions include:

• Examination Frequency: The bill allows qualifying banks with assets under $6 billion to be examined no more than once every 18 months, rather than more frequent assessments that might apply under current regulations.
• Focus on Well-Managed Institutions: The revisions reflect a focus on reducing the regulatory burden on well-managed and smaller institutions that are deemed to possess a lower risk.

Goals of the Bill

The proposed changes aim to accomplish the following:

• Reduce the regulatory load on small banks, allowing them to focus resources on providing services rather than preparing for frequent examinations.
• Encourage the growth and sustainability of smaller banks by ensuring they are not overly burdened by compliance requirements.
• Adjust the regulatory framework to better match the risk profiles of smaller banking institutions, promoting efficiency in supervisory practices.

Impact on Supervision

By permitting less frequent examinations for these smaller banks, the bill may alter the landscape of oversight in the banking industry, allowing federal agencies to redirect their resources toward larger or more complex banking institutions that may present a higher risk to the financial system.

The Legislative Process

This bill was introduced in the House of Representatives on July 17, 2025, by Mr. Moore of North Carolina alongside Mr. Torres of New York. The bill has been referred to the Committee on Financial Services for further consideration.

Relevant Companies

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