Technical corrections only. The reported version of the bill (v2) is substantively identical to the introduced version (v1), with the reported text replacing the original text without any changes to the operative language. No substantive policy changes were made.
TIER Act of 2025
- Sponsor
- Rep. Barr, Andy [R-KY-6]
- Committees
- Financial Services Committee (primary)
- Last action
- Feb 25, 2026
Bottom line
The TIER Act aims to reduce regulatory burdens on a segment of financial institutions by raising asset thresholds that trigger enhanced oversight and by creating an automatic indexing system to account for economic growth.
What it actually does
This bill significantly increases various asset thresholds for financial institutions under the Federal Reserve Act, Bank Holding Company Act of 1956, and the Financial Stability Act of 2010 (Dodd-Frank Act). These thresholds determine the level of regulatory scrutiny, assessments, and enhanced prudential standards applied to banks and financial companies. Crucially, it also establishes a new mechanism for future periodic adjustments of these statutory and rule-based thresholds, indexing them to changes in current-dollar United States Gross Domestic Product (GDP).
Proponents argue
Proponents argue that the current statutory thresholds, established years ago, have not kept pace with economic growth and inflation, leading to an over-application of stringent regulations to institutions that are no longer systemically significant relative to the overall economy. Indexing these thresholds to GDP will ensure that regulations remain appropriately tailored, reducing compliance costs for smaller and mid-sized financial institutions without compromising financial stability. This approach provides regulatory certainty and reduces the need for repeated legislative intervention.
Opponents contend
Opponents argue that increasing these thresholds could weaken financial oversight, potentially exposing the financial system to greater risk by exempting more institutions from robust prudential standards. They contend that the original thresholds were set to capture a broader range of institutions for stability purposes, and automatically indexing them could erode critical safeguards, especially during periods of rapid economic expansion, without adequate congressional review or public debate.
The bill is concise and its core provisions are clearly stated, making it accessible for a quick but informed review by a reader interested in financial regulation.
Section 2(a)
Adjustments to Federal Reserve Act Assessment Thresholds
This provision increases the total consolidated asset thresholds for bank holding companies and savings and loan holding companies under the Federal Reserve Act. Specifically, the $100 billion threshold is raised to $150 billion, and the range of $100 billion to $250 billion is adjusted to $150 billion to $370 billion. These thresholds are used by the Federal Reserve to determine the level of assessments imposed on these financial institutions.
Supporters argue
Supporters argue this adjustment appropriately reflects economic growth since the original thresholds were set, preventing smaller institutions from being subjected to disproportionately high assessments intended for larger, more complex entities. This ensures fair and tailored regulatory costs.
Critics contend
Critics might contend that lowering assessments for these institutions could reduce the Federal Reserve's resources for oversight or signal a weakening of regulatory vigilance, potentially increasing systemic risk by reducing the financial burden of regulation.
Tradeoffs
This provision balances the desire to reduce regulatory burden on mid-sized institutions against the need for adequate funding for regulatory oversight and maintaining a robust supervisory framework.
Section 2(b)
Adjustment to Bank Holding Company Act Threshold
This provision increases the asset threshold under the Bank Holding Company Act of 1956 from $10 billion to $15 billion. This threshold is relevant for determining certain activities and regulatory requirements for bank holding companies, often influencing the scope of permissible non-banking activities.
Section 2(c)
Adjustments to Financial Stability Act of 2010 (Dodd-Frank) Thresholds
This section makes numerous adjustments to asset thresholds within the Financial Stability Act of 2010 (commonly known as Dodd-Frank). Key changes include raising the $250 billion threshold to $370 billion in several sections (e.g., sections 116(a), 121(a), 163(b), 164, 165(a)(1), 165(i)(2)(A), 165(j)(1)) and increasing the $10 billion threshold to $15 billion (section 163(b)). It also raises the $100 billion threshold to $150 billion (section 165(a)(2)(C)) and the $50 billion threshold to $75 billion (section 165(h)(2)). These thresholds are critical for determining which financial institutions are subject to enhanced prudential standards, stress tests, and other systemic risk regulations.
Section 2(d)
Adjustment to Economic Growth, Regulatory Relief, and Consumer Protection Act Threshold
This provision increases the asset threshold in Section 401(f) of the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA) from $250 billion to $370 billion. This threshold is related to the application of enhanced prudential standards, specifically concerning the ability of the Federal Reserve to tailor such standards for certain financial institutions.
Section 3(a), adding new Section 177 to the Financial Stability Act of 2010
Automatic Indexing of Statutory Thresholds to GDP
This new section mandates that by April 1, 2031, and every five years thereafter, the Board of Governors of the Federal Reserve shall increase specified statutory asset thresholds (including those in the Federal Reserve Act, Bank Holding Company Act, and Financial Stability Act) based on the ratio of current-dollar United States Gross Domestic Product (GDP). The adjustment will use the annual GDP value from the preceding calendar year compared to the GDP value preceding April 1, 2026. Amounts will be rounded up to the nearest $50 billion for thresholds equal to or greater than $100 billion, and to the nearest $5 billion for thresholds less than $100 billion.
Section 3(a), adding new Section 178 to the Financial Stability Act of 2010
Agency Review and Adjustment of Rule-Based Thresholds
This new section requires the Board of Governors, the Comptroller of the Currency, and the Federal Deposit Insurance Corporation (FDIC) to review their regulations implementing Section 165 of the Financial Stability Act (or cross-referencing such regulations) by June 30, 2026, and every five years thereafter. They must modify any asset or quantitative thresholds *not prescribed by statute* in these regulations, using a similar GDP-based ratio as in Section 177. Agencies are directed to seek uniform thresholds and consistent rounding. A report to Congress is required after each review, detailing any modifications made.