House Strikes a Deal on Bipartisan Capital Markets Legislation, RBC Delay Included in Package

The full House on Tuesday night passed by a 406-4 vote the JOBS and Investor Confidence Act of 2018, also known as House Financial Services Committee Chairman Jeb Hensarling’s “JOBS Act 3.0,” which includes a package of 32 bills, some of which make changes to the Dodd-Frank law. Representatives supporting the bill included Delaware’s Blunt Rochester;  Massachusetts’ Capuano, Clark, Keating, Kennedy, Lynch, McGovern, Moulton, Neal, Tsongas; New Hampshire’s Kuster and Shea-Porter; Rhode Island’s Cicilline and Langevin; and  New Jersey’s Frelinghuysen, Gottheimer, Lance, LoBiondo, MacArthur, Norcross, Pallone, Pascrell, Payne, Sires and Smith.

“What we’re trying to do, and do it on a bipartisan basis, is ensure that our entrepreneurs at least don’t face the challenge of having the capital they need to launch their companies,” said Rep. Jeb Hensarling, chairman of the House Financial Services Committee, lead sponsor of the bill, during comments on the House floor.

“The small businesses of today become the Amazons, Googles and Microsofts of tomorrow,” he continued. ”Thanks to the hard work of members on both sides of the aisle — especially Ranking Member Maxine Waters who worked so strongly and fervently on a bipartisan, cooperative basis — this bill will make a difference for economic growth for all Americans.”

“Throughout my work on this legislation, I insisted that nothing could be included that would weaken Dodd-Frank’s financial reforms, harm consumers, or provide giveaways to Wall Street,” Waters said in comments on the House floor. “Instead, building on the bipartisan work of the financial services committee, S. 488 includes measures that will help small businesses grow and protect hardworking Americans that entrust their savings to the capital markets.”

Waters noted the package’s inclusion bills which require the Securities and Exchange Commission to set up a senior task force, revise the definitions of a ‘‘small business’’ and ‘‘small organization’’, and to more effectively consider the burden of its rules on smaller investment advisers. 

Other bills would mandate that federal bank regulators develop a method to calculate a financial institution's credit risk exposure, mandate that the SEC and the Financial Industry Regulatory Authority carry out a study related to midsize initial public offerings, ensures that international insurance standards and agreements are consistent with our domestic insurance system, provide greater Congressional oversight and transparency on international insurance standard negotiations, and allow crowdfunding investors to pool their money together into a fund that is advised by a registered investment advisor.

A small bill from Bill Posey (R-FL) would also delay the effective date of the National Credit Union Administration's risk-based capital rule from 2019 to 2021.

The so-called "JOBS 3.0" bill also includes a few provisions concerning living wills. Currently, the Federal Reserve and the Federal Deposit Insurance Corp. require bank holding companies with more than $50 billion in total consolidated assets to submit resolution plans by July 1 of every year. The proposed legislation would amend the post-crisis Dodd-Frank Act to extend the cycle for resolution plan submission to two years. It would also require the Fed and the FDIC to publicly disclose the assessment framework for living wills and establishes penalties for the unauthorized disclosure of information related to living wills and stress tests.