What's happening
This bill raises the asset threshold from $250 million to $1 billion for banks eligible for less frequent state examinations.
Why it matters
Expanding eligibility for less frequent examinations means more banks—especially those with assets between $250 million and $1 billion—could benefit from reduced regulatory burdens, potentially freeing up resources for lending and other activities.
Raising the threshold may allow growing community and regional banks to operate with greater flexibility, possibly fostering local economic development and competitiveness against larger institutions.
The change maintains safeguards by still requiring banks to be well-capitalized, well-managed, and free of recent enforcement actions, aiming to balance regulatory relief with continued oversight of financial stability.
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Who cares
Banking organizations with assets of $250 million to under $1 billion
The bill would make them eligible for examinations at least once every 18 months instead of annually, if they meet the existing financial, management, enforcement and acquisition conditions.
New York’s superintendent of financial services
The bill would expand the pool of banking organizations for which the superintendent may authorize the longer examination interval.
Bank compliance officers and management
Newly eligible institutions could face less frequent examinations, but would still need to satisfy the existing eligibility requirements.
Headline styles
Ease Bank Exam Rules
Plain English, a few words. Used as the page title.
Sponsors
1 Co-sponsor
History
- Signed chap.380
- Delivered to governor
- Returned to senate
- Passed assembly
- Ordered to third reading rules cal.263
- Substituted for A8129A
- Referred to banks
- Delivered to assembly
- Passed senateVote 63–0
- Amended on third reading 3758a
- Advanced to third reading
- 2nd report cal.
Show 2 earlier actions
- 1st report cal.1349
- Referred to banks
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Expand Small Bank Exam Threshold
Assembly Floor Calendar · Sponsor Kenneth Zebrowski
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
3758--A Cal. No. 1349
2017-2018 Regular Sessions
IN SENATE
January 26, 2017
Introduced by Sens. HAMILTON, SAVINO -- read twice and ordered printed, and when printed to be committed to the Committee on Banks -- reported favorably from said committee, ordered to first and second report, ordered to a third reading, amended and ordered reprinted, retaining its place in the order of third reading
AN ACT to amend the banking law, in relation to examinations
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Paragraph (b) of subdivision 2 of section 36 of the banking law, as amended by chapter 464 of the laws of 2006, is amended to read as follows:
(b) the superintendent may extend the examination interval from at least once in each calendar year to at least once in each eighteen month period if the banking organization to be examined:
(1) has total assets of less than [two hundred fifty million dollars] one billion dollars;
(2) is well-capitalized, which for purposes of this paragraph is defined as having capital which significantly exceeds the required minimum level for each relevant capital measure or as having such capital as the superintendent shall otherwise define by regulation;
(3) at its most recent examination, was found to be well-managed and its composite condition was found to be outstanding or good;
(4) is not currently subject to a formal enforcement proceeding or order by the superintendent, the federal deposit insurance corporation or any other federal banking agency; and
(5) has not been acquired by any person during the twelve month period in which an examination would be required but for this paragraph, and
§ 2. This act shall take effect immediately.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD08454-03-7
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the banking law, in relation to examinations
Purpose
Changes the interval and asset threshold for examinations of certain banks by the Department of Financial Services
Summary of provisions
Amends paragraph (b) of subdivision 2 of § 36 of the banking law extends the examination period to once in 18 months for banks with assets of less than $1 billion.
Existing law
Current law allows the superintendent of DFS to extend the examination interval from once each calendar year to at least once each eighteen month period for banks with assets over $250 million.
Justification
Community banks are facing challenges from increased regulatory and technology demands. The thousands of pages of new federal regulations from Dodd Frank apply to banks irrespective of size or their business model. Community banks have additional costs and staff to respond to compliance requirements. This increased regulatory burden reflected in the continuing loss of community banks in New York State. From 1992 to 2011, the number if community banks in New York State has shrunk from 299 to 169. This trend has not dissipated. There is pressure to consolidate in part to achieve scale to meet compliance requirements in a cost-effective manner.
This bill seeks to provide community banks under $1 billion in assets (currently $250 million) with regulatory relief by extending the it examination cycle from annually to 18 months. As a predicate to extend the examination cycle, the bank must demonstrate it is well capitalized, the most recent exam determined the bank was well managed and its composite condition was outstanding or good, and there was no pending enforcement proceeding.
This proposal will not only benefit community banks but also permit the Department of Financial Services to deploy examiners more effectively. There are protections to ensure that a problem banks does not receive a six month extension of their review cycle.
Legislative history
2015 Session - New Legislation
Fiscal implications
None
Effective date
Immediately
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.