On November 15th, House Financial Services Committee Chairman Jeb Hensarling (R-TX) signaled that he is willing to consider changes to a reintroduced Financial CHOICE Act next year as a newly elected and party-unified government prepares to take office. 

Speaking at a lunch at the Exchequer Club in Washington, Hensarling indicated that he would accept input on a revamped version of his bill to dramatically overhaul and replace portions of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Chairman introduced his legislation in June and his committee passed it in September largely along party lines and without Democratic participation (See here and here). 

“Advice and counsel is welcome,” Hensarling said, as the committee and staff are “interested in working on a 2.0 version.” 

Committee Republicans acknowledged that the Financial CHOICE Act was not likely to receive consideration by the full Congress this year. Instead, they asserted that the bill would serve as a blueprint for financial regulatory reform next year in the event that Republicans maintained control of Congress and won the White House. President-elect Trump recently stated on his transition website that he is committed to repealing and replacing Dodd-Frank but separately has not endorsed Hensarling’s legislation. However, Hensarling indicated that he and the President-elect’s transition team maintain constant communication regarding legislative efforts to address the financial services industry. Hensarling also has been floated in recent days as a potential pick for Treasury Secretary. 

The Financial CHOICE Act would reform rules for large and small banks and contains provisions that would exempt banks from certain regulations in exchange for meeting higher capital requirements. Other key measures include organizational reforms to the Consumer Financial Protection Bureau (CFPB) such as replacing the CFPB’s sole director with a bipartisan leadership commission and subjecting the Bureau’s budget to Congressional oversight for the first time. The bill also would permit the federal government to wind down failed banks and eliminate the Financial Stability Oversight Council (FSOC) and its authority to designate institutions “too big to fail.”