H.R. 6554: Community Bank Representation Act

The Federal Reserve Board has seven governors. Current law already says at least one must have primary experience working in or supervising community banks, defined there as banks with less than $10 billion in assets. What the law does not do is give that person any particular job once confirmed.

H.R. 6554 would require the Fed chair to put that community-bank governor in charge of policy recommendations and supervision for Fed-supervised banks under $17 billion in assets. The work would be done in consultation with the vice chair for supervision and any other governor with a similar background. No new seat is created; the assignment goes to an existing member.

The bill also drops the $10 billion qualifier from the appointment requirement itself. A nominee's community-bank experience would no longer have to come from banks under that size.

If the chosen governor is not also the vice chair for supervision, they would appear before the Senate Banking Committee and House Financial Services Committee every six months to report on how the Fed is supervising smaller banks. The Fed's representative on the interagency council that sets bank examination standards would also have to consult with them.

The $17 billion line would not stay fixed. In any year nominal GDP reaches a new five-year high, the Fed would raise the cutoff by the same percentage, using Bureau of Economic Analysis figures. At roughly 5% nominal growth, that would move the line to about $17.9 billion after one year and about $21.7 billion after five. Because the adjustment only counts growth above the prior five-year peak, the threshold can rise but never fall.