A bill was introduced in Congress that would require federal banking agencies to exclude paycheck protection program (PPP) loans from certain asset calculations.
HR 8675 is sponsored by House Financial Services Committee Member Barry Loudermilk (R-Ga.), and would apply to financial institutions with less than $15 billion in assets, including the National Credit Union Administration. It was referred to the House Committee on Financial Services on Oct. 23.
Loudermilk, other Republican committee members, and Senator Mike Crapo (R-Idaho), have questioned federal banking regulators about the rising number of assets on lenders’ balance sheets. The rise in assets is primarily from PPP loans and other pandemic-related lending efforts and could result in banks and credit unions surpassing certain asset-based regulatory thresholds.
By excluding PPP loans from the asset calculations, these smaller banks would be able to avoid regulatory burdens triggered by meeting the asset threshold.