COMMUNITY BANK DEPOSIT ACCESS ACT OF 2025

On 2026-05-19, Representative Maxine Waters (D-CA-43) delivered a floor speech titled "COMMUNITY BANK DEPOSIT ACCESS ACT OF 2025" in the House.

COMMUNITY BANK DEPOSIT ACCESS ACT OF 2025

Congressional Record, Volume 172 Issue 85 (Tuesday, May 19, 2026) [Congressional Record Volume 172, Number 85 (Tuesday, May 19, 2026)] [House] [Pages H3586-H3588] From the Congressional Record Online through the Government Publishing Office [ www.gpo.gov ] COMMUNITY BANK DEPOSIT ACCESS ACT OF 2025 Mr. HILL of Arkansas. Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 5317) to amend the Federal Deposit Insurance Act to ensure that certain custodial deposits of well capitalized insured depository institutions are not considered to be funds obtained by or through deposit brokers, and for other purposes, as amended. The Clerk read the title of the bill. The text of the bill is as follows: H.R. 5317 Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE. This Act may be cited as the ``Community Bank Deposit Access Act of 2025''. SEC. 2. LIMITED EXCEPTION FOR CUSTODIAL DEPOSITS. (a) In General.--Section 29 of the Federal Deposit Insurance Act (12 U.S.C. 1831f) is amended by adding at the end the following: ``(j) Limited Exception for Custodial Deposits.-- ``(1) In general.--Custodial deposits of an eligible institution shall not be considered to be funds obtained, directly or indirectly, by or through a deposit broker to the extent that the total amount of such custodial deposits does not exceed an amount equal to 20 percent of the total liabilities of the eligible institution. ``(2) Definitions.--In this subsection: ``(A) Custodial deposit.--The term `custodial deposit' means a deposit that is not deposited at an insured depository institution in return for fees paid by the insured depository institution pursuant to an agreement with a third party and that would otherwise be considered to be obtained, directly or indirectly, by or through a deposit broker, if the deposit is deposited at 1 or more insured depository institutions, for the purpose of providing or maintaining deposit insurance for the benefit of a third party, by or through any of the following, each acting in a formal custodial or fiduciary capacity for the benefit of a third party: ``(i) An insured depository institution serving as agent, trustee, or custodian. ``(ii) A trust entity controlled by an insured depository institution serving as agent, trustee, or custodian. ``(iii) A State-chartered trust company serving as agent, trustee, or custodian. ``(iv) A plan administrator or investment advisor, acting in a formal custodial or fiduciary capacity for the benefit of a plan. ``(B) Eligible institution.--The term `eligible institution' means an insured depository institution that accepts custodial deposits, if the insured depository institution has less than $10,000,000,000 in total assets as reported on the consolidated report of condition and income as reported quarterly to the appropriate Federal banking agency and-- ``(i)(I) when most recently examined under section 10(d) was assigned a composite rating of 1, 2, or 3 under the Uniform Financial Institutions Rating System (or an equivalent rating under a comparable rating system); and ``(II) is well capitalized; or ``(ii) has obtained a waiver pursuant to subsection (c). ``(C) Plan.--The term `plan' has the meaning given the term in section 3 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002). ``(D) Plan administrator.--The term `plan administrator' has the meaning given the term `administrator' in section 3 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002). ``(E) Well capitalized.--The term `well capitalized' has the meaning given the term in section 38(b).''. (b) Interest Rate Restriction.--Section 29 of the Federal Deposit Insurance Act (12 U.S.C. 1831f), as amended by subsection (a), is further amended by adding at the end the following: ``(k) Restriction on Interest Rate Paid on Certain Custodial Deposits.-- ``(1) Definitions.--In this subsection-- ``(A) the terms `custodial deposit', `eligible institution', and `well capitalized' have the meanings given those terms in subsection (j); and ``(B) the term `covered insured depository institution' means an insured depository institution that while acting as an eligible institution under subsection (j), accepts custodial deposits while not well capitalized. ``(2) Prohibition.--A covered insured depository institution may not pay a rate of interest on custodial deposits that are accepted while not well capitalized that, at the time the funds or custodial deposits are accepted, significantly exceeds the limit set forth in paragraph (3). ``(3) Limit on interest rates.--The limit on the rate of interest referred to in paragraph (2) shall be not greater than-- ``(A) the rate paid on deposits of similar maturity in the normal market area of the covered insured depository institution for deposits accepted in the normal market area of the covered insured depository institution; or ``(B) the national rate paid on deposits of comparable maturity, as established by the Corporation, for deposits accepted outside the normal market area of the covered insured depository institution.''. SEC. 3. DISCRETIONARY SURPLUS FUND. (a) In General.--The dollar amount specified under section 7(a)(3)(A) of the Federal Reserve Act (12 U.S.C. 289(a)(3)(A)) is reduced by $4,000,000. (b) Effective Date.--The amendment made by subsection (a) shall take effect on September 1, 2036. The SPEAKER pro tempore. Pursuant to the rule, the gentleman from Arkansas (Mr. Hill) and the gentlewoman from California (Ms. Waters) each will control 20 minutes. The Chair recognizes the gentleman from Arkansas. [[Page H3587]] {time} 1730 General Leave Mr. HILL of Arkansas. Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days in which to revise and extend their remarks and include extraneous material on this bill. The SPEAKER pro tempore. Is there objection to the request of the gentleman from Arkansas? There was no objection. Mr. HILL of Arkansas. Mr. Speaker, I include in the Record the Congressional Budget Office estimate for the bill. The SPEAKER pro tempore. Is there objection to the request of the gentleman from Arkansas? There was no objection. Legislation Considered Under Suspension of the Rules The Majority Leader of the House of Representatives announces bills that will be considered under suspension of the rules in that chamber. Under suspension, floor debate is limited, all floor amendments are prohibited, points of order against the bill are waived, and final passage requires a two-thirds majority vote. At the request of the Majority Leader and the House Committee on the Budget, CBO estimates the effects of those bills on direct spending and revenues. CBO has limited time to review the legislation before consideration. Although it is possible in most cases to determine whether the legislation would affect direct spending or revenues, time may be insufficient to estimate the magnitude of those effects. If CBO has prepared estimates for similar or identical legislation, a more detailed assessment of budgetary effects, including effects on spending subject to appropriation, may be included. EFFECTS ON DIRECT SPENDING AND REVENUES OF LEGISLATION CONSIDERATION UNDER SUSPENSION OF THE RULES IN THE HOUSE OF REPRESENTATIVES Week of May 18, 2026 -------------------------------------------------------------------------------------------------------------------------------------------------------- Additional Effect on Direct Information on Direct Link to Published Bill Number Title Spending Effect on Revenues Spending and Revenue Estimates Effects -------------------------------------------------------------------------------------------------------------------------------------------------------- H.R. 5317.......................... Community Bank Deposit Increase by at Least Increase by at Least Would increase direct N/A Access Act of 2025, $500K. $500K. spending by $3 as amended. million, increase revenues by $3 million, and result in no increase in the deficit,. -------------------------------------------------------------------------------------------------------------------------------------------------------- Mr. HILL of Arkansas. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, I will speak in support of H.R. 5317, the Community Bank Deposit Access Act. This is a bill that over my time in Congress I have introduced several times and worked with colleagues to extend the ability to attract deposits to local community banks to make them more competitive. This bill works to essentially give community banks greater flexibility to access stable and reliable funding sources so that they can continue to meet the financial needs of the communities they serve. Community banks, as we have talked about today, play a vital role in our local economies by supporting small businesses, farmers, and consumers who depend on them for access to credit and other essential financial services. That is why it is important that our community institutions have access to a diverse and dependable set of funding sources so that they can continue to meet these demands. One source of funding comes through custodial deposits, which are the funds placed at a bank by a third party on behalf of underlying customers or beneficiaries who own the funds but may not have a direct banking relationship with that institution. Mr. Speaker, a few minutes ago, we talked about reciprocal deposits. Let's say I am a small business, and I have $500,000 as a typical average collected balance in my business, but I only have deposit insurance of $250,000. The reciprocal deposit bill that Mrs. Beatty offered a few minutes ago with Tom Emmer of Minnesota allows that other $250,000 for that small business to be covered for deposit insurance. That is very important and very useful to have that customer-bank service relationship. Custodial deposits are similar, bu

Referenced legislation: HR5317, HR5317